Reading and Understanding Owner Statements: A Brief Guide

Did you know that the average annual pay for a landlord in the United States is almost $70,000 a year?

If you are making significantly less than the country's average, you might have an issue with your owner statements.

Owner statements give you a financial overview of your rental properties, but new landlords might not know how to read them. Continue reading to learn how to understand owner statements.

What Are Owner Statements?

An owner statement is the financial breakdown of the investor portfolio. Rental property owners should receive these on a monthly basis from their property managers.

Owner statements detail the financial activity that has occurred over the past month.

First Page of the Owner Statement

An ownership statement generally follows a standard outline. The first page of an owner statement has the following information:

Date
Instructional paragraph
Summary of information

The instructional paragraph will tell you how to read the owner statement so it's easier for new owners to understand.

The summary of information is a breakdown of the information you'll find on the remaining pages of the owner statement. It acts as a quick glance into the financial activity of the portfolio.

Portfolio Detail Pages

Page 2 of the owner statement details information about the rental property building/buildings.

At the top of this page, you'll see the portfolio name and buildings listed. You'll see all buildings recorded in this section if you have more than one rental property.

Each building has the following set of information:

Property expenses: Description of maintenance, turnover, etc., and the costs
Rental income: Amount collected over the period
Management fee expense: An expense listed under each building
Income and expenses: Total of each calculated for all buildings

Rental property transactions are easy to read and understand in this section.

Final Page of the Owner Statement

The final page of the owner statement includes the amount the owner is owed. You'll find the funds amount under the owner draw section.

You can also calculate the ending balance with this information, but there will be a section in the portfolio that records this balance for you.

The ending portfolio balance follows this calculation: Income + beginning balance - (owner draw + expenses).

The final page also includes the following information:

Portfolio minimum: Funds to cover maintenance items
Unpaid bills: Table of bills yet to be paid out
Less unsettled ePayments: Payments that need to be settled before the money is disbursed to the owner
Lease information: Active leases connected to the portfolio

When you hire a property management company, you'll receive owner statements each month, usually via email. You can also log into the Owner Portal to view statements online.