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Hiring a Bookkeeper for Your Rental Property Business

It’s time to get some bookkeeping help for your real estate investments. Do you know where to start on your search for a bookkeeper? What level of bookkeeping do you need? How much should you expect to pay? Finding and hiring the right bookkeeper can be as difficult and important as doing the books for your rental units.

It’s a lot to think about, so we’ve put together a guide to hiring bookkeepers for rental property owners. We’ll cover all the essential points: bookkeeper responsibilities, levels of bookkeeping, types of bookkeepers, costs, and hiring considerations.

What Is a Bookkeeper?

Let’s get clear on what a bookkeeper is. Your bookkeeper is the person who records your business’s accounts or transactions and handles daily financial duties.

Bookkeeping may include any combination of these tasks:

  • Building, updating, and monitoring budgets
  • Managing invoices
  • Posting payments
  • Preparing financial statements
  • Reconciling accounts
  • Recording data
  • Running payroll

A bookkeeper can also act as a second set of eyes to spot trends, patterns, or gaps in your business’s transactions. This new perspective can help you run a more efficient business by teaching you how to cut costs or modify your spending habits.

Note that bookkeepers aren’t the same as accountants. Bookkeepers usually handle basic financial tasks. CPAs go beyond the basics to offer advice, financial forecasting, audits, and tax preparation services.

Levels of Bookkeeping

There are three levels of bookkeeping determined by the scope of work in the role, the bookkeeper’s experience level, and their certifications.

General Bookkeeping

General bookkeepers work with single- or double-entry accounting. They might not have formal training, but they’re typically familiar with one or two kinds of financial software.

This is usually an entry-level position responsible for recording transactions, posting payments and invoices, and reconciling accounts.

Full-Charge Bookkeeping

A full-charge bookkeeper has all the same responsibilities as a general bookkeeper, but they’ll also prepare financial statements and handle payroll, if needed.

This role is most common for small- or medium-sized businesses. It calls for more experience and usually some formal training.

Certified Bookkeeping

Certified bookkeepers can handle all the tasks covered by full-charge bookkeepers in addition to these duties:

  • Accounts payable and receivable
  • All financial and income statements
  • General ledger work
  • Monitoring daily transactions
  • Payroll reports
  • Quarterly tax payments
  • State reporting
  • Year-end tax documents and statements

A certified bookkeeper must pass a four-part national exam and have two years of accounting experience. Like CPAs, certified bookkeepers earn the right to have letters after their name. They’re also required to keep up with continuing education to stay current on tax laws

What Kind of Bookkeeper Should You Hire?

Aside from the levels of bookkeeping, bookkeepers usually fit into one of four categories.

Virtual

A virtual bookkeeper is good for a growing business as long as you’re using a cloud-based accounting software, like REI Hub. You’ll receive accounting support from someone who can work on your books from anywhere.

Freelance

A freelance bookkeeper may be virtual or in-person. Either way, they’re helpful for rental property owners who need flexibility, not daily support. You could pay for a few hours per week or month to keep your books in shape.

CPA

A certified public accountant can handle everything from your bookkeeping to tax preparation and filing. This all-in-one solution may sound like a good idea. Be careful, though. CPAs have higher hourly rates than bookkeepers, so you may end up paying more. And depending on the agreement with your CPA, you might miss out on the monthly reports a bookkeeper can offer.

How Much Does Bookkeeping Cost?

The US Bureau of Labor Statistics reported that bookkeepers received a median hourly rate of $22.05 in 2022. Indeed shows the 2024 rates have increased slightly, with a range from $15.84 to $30.80 per hour. As your accounting needs become more complex or urgent, expect those rates to go up.

Bookkeeping costs will depend on your needs, location, and the bookkeeper’s level of experience. And bookkeepers have multiple ways of setting their prices:

  • Fixed rate
  • Hourly Rate
  • Per bank account
  • Per transaction
  • Percentage of client’s income

They may assign other charges as well, like a fee for an initial consultation or a minimum monthly retainer.

How to Hire a Bookkeeper

Giving someone access to your financial information is an important step. It requires confidence and trust. Use our four-part checklist to help you find the right bookkeeper for your rental property business.

Analyze Your Needs

What do you need help with? Determining the scope will help you figure out what level of bookkeeping you need.

  • How many accounts do you have?
  • Do you have more than one business that needs accounting help?
  • How many transactions do you have per month?
  • What kind of reporting do you want your bookkeeper to provide?
  • Will you need help with invoicing, payments, bank deposits, reconciliation, document storage, etc.?
  • Will your bookkeeper handle your 1099 tracking and submission?
  • Who will handle your estimated tax calculations and payments?

Think About Your Schedule

Availability matters—both to you and your bookkeeper. Be clear about expectations and deadlines from the start.

  • What turnaround time do you need?
  • How often do you want your bookkeeper to work on the books?
  • What deadlines do you need help with?
  • Will you need extra help during tax season or at the end of the year?
  • Do you want in-person help?
  • Are occasional meetings needed or just email support?
  • Does it matter to you if your bookkeeper is in a different time zone?

Get Referrals

A recommendation goes a long way when you’re adding a team member.

Industry forums like BiggerPockets or mastermind groups may recommend bookkeepers in your area.

Local accounting firms may provide references or referrals.

Financial industry associations like the AIPB, ICBUSA, NACPB, or DBA may have job boards or member directories.

Once you’re interviewing candidates, ask them to provide references and proof of client satisfaction.

Consider the Fit

The goal is to find someone who complements you and strengthens your business. So bookkeeping skills are crucial, but those skills alone aren’t enough. Consider candidates’ backgrounds, communication styles, and mindsets too.

  • Does your candidate have experience working with real estate investors or rental property owners?
  • Does their style of communication work for you? If you prefer email, but they only call, the candidate might not be the best option for you.
  • Can you understand what they’re saying? This isn’t about regional accents—it’s about accounting jargon. Can the candidate explain concepts and your books in a way that makes sense to you?
  • Is the candidate open to accountability measures, like bookkeeping reviews, task authorizations, or security measures?

Remember, ultimately you are responsible for your business’s books—even if your bookkeeper makes a mistake.

Outsourcing your accounting isn’t a free pass to ignore your books. Monthly and annual reviews should be part of your workflow, especially when someone else handles the data entry and reconciliations.

Takeaways

Your account books are a critical part of your rental property business. That means hiring a bookkeeper isn’t a task to take lightly. It’s an important investment that can strengthen your business, saving you time and money. That’s why we created this guide to help real estate investors like you navigate the essential questions about hiring bookkeepers.

Once you’ve hired your bookkeeper, granting them access to your REI Hub account is a breeze. Not a subscriber yet? We have everything you need for your rental property’s books: property-based reporting, income and expense tracking, document storage, templates specific for rentals, and more. See why our clients and their bookkeepers love our software. Sign up for a free trial today!