As a real estate investor, your business thrives when it’s properly maintained and optimized for future growth. You’ve counted the costs, done the research, and created a model for current success. But at a certain threshold, we all reach our personal limitations—or think, “There must be an easier way!”
That’s where property management software comes in.
Property management software can help real estate investors perform better in the present and grow faster in the future by simplifying everyday processes. But with all the property management software and app options available, what sets one apart from another? Which features are foundational and which are fluff?
Let’s take a look at how you can determine which property management software is best for your real estate investing business.
Benefits of Property Management Software
All property management software is designed to help support the usual tasks surrounding real estate investments. From marketing to security and from payables to analytics, software systems can give you the information and capabilities you need to run a real estate investment business efficiently.
Good software helps with the basics: listings, screenings, and applications.
Great software coordinates even more: payments, contracts, and financials.
Bottom line: Property management systems will help save you time and money.
Benefits for real estate investors
If you’re a real estate investor overseeing your own properties, you may not have ever considered property management software. You might have your own system of contacts, spreadsheets, and listings, and it’s working just fine. You may think property management software is costly, that it’s just for mega-companies, or that it’s more trouble than it’s worth.
But property management software comes in multiple formats—some that are best used by smaller investors and others that are designed for hundreds of doors. In fact, some of the best systems allow you to add features over time, helping you to grow your business at a pace that works for you and your budget.
Just because you’re not an official “property manager” doesn’t mean you can’t benefit from property management software, especially if you’re playing the role of manager to your own properties. Take a look at some of the features that could make your life easier as a real estate investor.
Common Property Management Features
No two property management programs are exactly alike, but many share some sort of combination of these common features. Before settling on any system, you’ll want to determine which features are most important to you in order to help narrow down your options.
Most property management systems will help with listings, though the level of interaction and customizability varies across formats, as do the marketing capabilities. Many programs syndicate listings across popular tenant-facing websites, such as Zillow and HotPads, and some will also synchronize with your own website. In terms of usability, templates are the common method of information gathering, with the best programs allowing for the addition or subtraction of fields.
Certain higher-profile systems will go a step beyond listings to actually coordinate showings. By syncing with your calendar, the program can offer available time slots or push potential applicants toward open houses. This is, of course, a huge time saver in regards to both communication and scheduling—but again, this feature is more rare, especially in the entry-level range of property management systems.
Many property management software systems will allow users to either utilize template-based tenant applications or create their own custom applications. But all applications are not created equal; some one-click applications may not be as helpful in narrowing down tenant options, which is what a good application should do. As expected, the price of the system often plays a role in how basic or complex the application feature may be.
Screening services are common across almost all property management platforms, and for good reason. Proper screening helps ensure good, problem-free tenants. To that end, screening features to look for include credit, background, and possibly even income and references. Many systems allow the applicant to pay for the screening directly, which can be a benefit from both a security and future usability standpoint.
Some property management systems will generate state-specific leases that may or may not be customizable. Others have lease-upload capabilities and function solely as a means for online signatures and document storage. Many tenants and landlords appreciate having a paperless version of the signed lease for reference.
If a property management system offers a rent collection feature, it will usually be done through either ACH, EFT, or credit card. Fees vary across platforms for this service; sometimes those fees can be assigned to the tenant.
Possible attributes to look for when considering rent collection tools include:
- Timeliness of payment posting
- Security of the backing institution
- Assignability of fees
- Auto draft or reminder features for tenants.
Some management software includes a maintenance feature. Tenants are able to report maintenance issues. In some cases, they can even upload photos or videos for the manager or landlord to reference. Certain systems will also coordinate service vendors and sync with accounting to complete the full maintenance cycle.
The communication features available across property management software systems ranges between text alerts and dedicated portals and everything in between. Some basic systems work more as a hub for contacts, while others are designed to track and catalog all communication via private owner and tenant communication centers.
Financial reporting, tax preparation, general ledgers, data analysis, reserve tracking—some higher-end property management software systems contain all these features and more. Accounting features are not common in simpler systems, however, so many real estate investors continue to use second party accounting software.
What to Look For
As you’re hunting for the best property management software, ask yourself the following questions:
Is it easy to use?
Property management software should save you time, not cost you time. The features should be intuitive and the design should be easy to navigate.
Many software systems offer a free trial or at least a video demo of their product. Be sure to take advantage of those options before committing to a single system, especially if you’re signing a contract or investing a good amount of money up front.
After all, once you convert all your data, clients, tenants, and colleagues to a new system, you don’t want to get frustrated and make yet another change a few months down the road.
Is it secure?
In today’s world of overabundant identity theft, you want your property management system to be safe on all accounts. The information within the system will represent your livelihood, your property, and your tenants’ homes—it needs to be secure! Be sure that screening features are backed by a legitimate source (TransUnion, Equifax, or Experian). Check that rent collections go through secure banking channels. And ask about login procedures to safeguard personal data collected through leases and communication.
Does it fit your real estate investing business?
Pricing for property management software can range from free to several hundred dollars per month. The more expensive systems will inherently have the most features, but if you’re only working with a few doors, can your business afford all the bells and whistles?
Similarly, if you’re overseeing hundreds of properties, can you really keep up without investing in a more all-inclusive system? Think through what will help your business now and in the future.
What Does Your Business Need?
On that note, here are some general ideas of the features that might be important for various stages of real estate investing. Keep in mind that some systems are scalable, so if you plan to grow over time, you may want to look specifically for a platform with features that can be added in increasing increments.
Look for something that will help with listings and screenings at the very minimum. Application and lease features are a great bonus. Your bank likely has free paperless rent collection options for you, so it may be best to rely on those for now.
- Avail. With a no-cost preliminary tier and a no-minimum premium tier, Avail is a choice best-suited for landlords who act as their own property manager. Avail provides basic management tools that work for those with as few as one rental unit. It can also be customized for those who may need additional capabilities.
- Innago. This is an easy-to-use tenant management tool best for small- to mid-size landlords. Since the service is free, it’s a good bet for a value-minded user.
- TurboTenant. This suite is best for landlords who manage one to five properties and need assistance with listing and screening services. Those who use TurboTenant should have an outside accounting software and payment system that works well for them.
- Cozy. Ideal for investors who manage their own rentals or property managers who have fewer than 20 units—especially since its basic services are free for landlords.
- Tellus. This suite is best suited for beginning or smaller-scale property investors who spend a lot of time on mobile and want to see what a designated property manager app can do for them without having to build their entire business first.
- RentRedi. This program’s accessible price point and comprehensive tools indicate that first-time investors, self-managing landlords, and smaller property management companies would all feel comfortable with this product.
- RentPrep. RentPrep is a tenant screening service that may be used by any landlord or property manager. However, RentPrep is most likely best for landlords who personally manage one to 25 units.
Grow your capabilities by incorporating a system that includes rent collection and maintenance features, as well as all of the above. If your business model supports it, you may also benefit from software that includes some basic accounting features.
- TenantCloud. TenantCloud is ideal for landlords and property managers looking for organized, digital communications with their tenants and service professionals; each category of user has a dedicated set of user tools through the cloud-based platform. It’s right for the small, DIY landlord (even the free tier allows management of up to 75 listings). However, it also has tools adequately suited for large, even institutional, investors.
- Hemlane. This program is best for real estate investors who own fewer than 100 rental properties and want to automate some aspects of property management, such as collecting rent and addressing maintenance issues, without hiring a property management company.
- SimplifyEm. While smaller investors and property managers can benefit from SimplifyEm’s substantial range of tools, the platform is also a solid pick for big-time landlords with properties numbering into the hundreds or more.
- Rentec Direct. Rentec Direct is best for real estate investors who own at least 10 rental properties and need to track and automate most landlording functions, from tenant screening to collecting rent and bookkeeping.
A full suite of features will help streamline the property management process from start to finish. Get great accounting features to analyze your investments and make projections. Look for communication features that help save you time and archive correspondence for legal purposes.
- RealPage. RealPage is a multinational company offering a comprehensive range of services for investors. Its extensive tools make it best suited for very large or enterprise-level investors with thousands of properties in the portfolio.
- Yardi. Yardi is best for property management companies with at least 100 rental units and is expandable for companies that bring in thousands of unique rental streams.
- Rent Manager. Rent Manager is ideal for people with large portfolios who want one software to handle all of their management needs.
- AppFolio. AppFolio was created with larger property management companies in mind. Individual investors or property managers with fewer than 100 to 200 rental units may find AppFolio to be more than they need, both from a budget and business practice standpoint.
Property management software has plenty of capabilities that can benefit real estate investors at every stage. To help determine which software system is best for you, take a look at our BiggerPockets reviews. Our unbiased overviews will help you find the software design and features that will enhance your business.
How do you choose a property management software suite?
Tell us in the comments below.