Money coming into your account is not the same as profit. To know whether a PG is really working, you need to subtract everything it cost to run that month.
The simple formula
Monthly profit = total income − total expenses. Break each side down:
- Income: rent collected, plus any other charges or fines you actually received
- Expenses: building rent or loan EMI, electricity, water, internet, groceries or mess costs, staff salaries, repairs and maintenance
Collected vs billed
Count income when it is received, and separately note what is still pending. A PG that bills fully but collects late can look profitable on paper while running short on cash.
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Track per building
If you run more than one property, calculate profit for each building. One strong building can hide a weak one if you only look at the total.
Keep the numbers clean all month
The hard part is not the formula; it is remembering every expense. Record each spend by category and building as it happens, and match every rent payment to a tenant. PG management software does this as you go, so month-end reports for occupancy, income and expenses are ready without reconciling a notebook.
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