Effective multifamily budget management is an integral aspect of success in today's dynamic market. However, property managers face notable challenges in accurately tracking multiple properties and minimizing costly errors. A cloud-based budget application emerges as a game-changing solution. By automating data consolidation, streamlining calculations, and offering real-time visibility, property managers are empowered to make informed decisions, optimize expenses, and drive financial performance.
The Challenges of Multifamily Budget Management
In the multifamily industry, budgeting poses a unique set of challenges for regional & property managers. With multiple properties, units, and expenses to track, the complexity of budget management can quickly become overwhelming. Everyone must navigate through a vast array of financial data, ensuring accuracy and keeping a keen eye on cost optimization.
Unfortunately, many multifamily leaders still rely on manual data entry in Excel spreadsheets, leading to a myriad of issues. This outdated approach often results in version control problems, where different versions of the budget circulate, making it difficult to consolidate and reconcile data accurately. Moreover, the manual nature of the process is time-consuming, with property managers spending countless hours on data entry, calculations, and updating spreadsheets. This tedious and error-prone workflow takes valuable time away from strategic decision-making, proactive financial planning, and most importantly, serving residents on-site. As the multifamily industry continues to evolve, leaders recognize the pressing need for a modern solution to simplify and streamline budgeting processes, ensuring greater accuracy, efficiency, and financial success.
Ready to refresh your budget season? We have put these tips and more in our new E-Book: Multifamily Guide to Budgeting. Download yours today and begin your journey toward a pain-free budget season!
Why Excel is Not the Answer
At a large multifamily industry conference, we polled our audience and found that 70% of them were using Excel as their budget application. We are here to tell you Excel is not the end-all-be-all- solution.
Simply put, it is not an enterprise application. It can be overly complex with all manual processes inputting data into the spreadsheets and then creating the appropriate output. This complexity introduces multiple opportunities for mistakes. It takes a lot of effort to lock down Excel the way a purpose-built application can; and it is impossible to drive workflow in Excel.
Excel also does not provide any underlying database storage. This makes analysis and aggregation at best a complex set of manual steps with references between worksheets (or worse, workbooks) and a variety of sophisticated functions like VLOOKUPs, INDEX matches, etc. In contrast, a budget application built on top of a structured database makes it easy to perform all the rollups, ad hoc analyses and other investigations users will want.
The Benefits of Using a Budget Application
Drawing from our extensive experience crafting tailored models using both "commercial tools" and Excel for numerous companies throughout our careers, we have identified four essential elements that contribute to exceptional multifamily budgeting practices. But when it comes down to it, your budget application should:
- Sit on top of a database – your data is never lost & it is easy to do portfolio reporting
- Control the workflow through a formal user interface - interface should control the workflow & do entry validation logic
- Allow multiple entries against the same ledger account – input different line items for each GL account
- Allow for note taking - Reduce the amount of budget and expense explaining
- Offer special case handling - allow for unique multifamily cases (lease-ups, CapEx, renovations)
- Take a payroll input from your HRIS - import payroll data to minimize keystrokes
- Provide security roles and access - have the security to protect who gets access to certain info & functionality
Our vision for a better multifamily budget season has driven our team to unlock those key tips and tricks for better budgeting. We have a passion for empowering multifamily leaders to build the genius into the system and take their success for multifamily to the next level.
It is high time for the multifamily industry to bid farewell to Excel as the go-to method for budgeting and forecasting. The era of overwritten cells wreaking havoc for years, tearful calls from Community or Regional Managers who forgot to save their Excel templates, and the hours wasted on consolidating multiple spreadsheets must end.
Instead, purpose-built applications tailored to the unique processes of multifamily should take center stage. By embracing these solutions, the industry can unlock tremendous time savings while achieving more accurate results. Let us embrace the future of budgeting and forecasting via technology, leaving behind the limitations of Excel, and embracing purpose-built, cloud-based solutions designed specifically for the multifamily industry. Together, we can usher in an era of streamlined processes, precise results, and data-driven success.
We have put these tips and more in our new E-Book: Multifamily Guide to Budgeting. Download yours today and begin your journey toward a pain-free budget season!