9 Tech Tools Transforming the Way Real Estate Investors Scale Their Portfolios

by | BiggerPockets.com

Real estate is one of the last industries to adopt technology, and investors can use that to their advantage to literally make millions today. Real estate continues to lag other sectors in terms of technology disruption. But for tech savvy investors, technology is creating scalable opportunities like never before. This is the second of a series of articles on how technology is changing real estate investing. You can read the first post on how technology is changing property management here. For this article, I detailed a list of tech systems that we have found beneficial for investing.

1. Free Online Education

Let’s start at square one: getting educated about real estate. The wide proliferation of the free podcast has been a game changer for real estate education. Forget paying $20k for a weekend retreat taught by a “guru.” All of the education you need is available online for free in the form of articles and podcasts. This may seem very basic—but I think it’s a fundamental shift in how information and knowledge is broadcasted. In terms of podcasts, I recommend three podcasts: BiggerPockets, Real Estate Guys, and Masters of Scale.  

  • The BiggerPockets Podcast does a great job of describing the basics of real estate investing in an easy-to-consume fashion.
  • Real Estate Guys Podcast digs into syndication, a next level up in the investing game.
  • Masters of Scale Podcast by Reid Hoffman gives you the mindset and systems thinking needed for scaling a business with technology.  

2. Availability of Sales Comps

Zillow is a huge game changer for any tech savvy investor. The Zillow filters make pulling comps a breeze. Zillow’s filters make it so easy that you can pull reasonable comps in literally five minutes. For any BRRRR investors out there, comps are essential to the eventual refinance, and for a flipper they are a must-have to figure out resale value.

Related: 7 Ways Technology is Completely Overhauling Property Management

Do I also use the MLS? Yes, I do use the MLS to dig for more granular data when needed, as I realize that not all data exists on Zillow. But I believe you can get 90 percent of the way there in a lot less time using Zillow data to pull comps.

Zillow.com Screenshot of Comp Data

3. Easy-to-Find Rental Estimates

Rental estimates are so interesting that they could probably be it’s own topic! There is a ton of data available online if you know where to look. We use four different sources to triangulate around rental information. Zillow is a decent first place to start, specifically for single family homes in highly populated areas. Next, we suggest using Rent-o-meter. As a third source, we use our own home built rent estimate tool, AccurateRent. This is only available currently in PA and NJ, but we will be expanding it to other areas in the future. It uses our own property management data to improve the algorithm and gets smarter over time as more data is available. Finally, we email a local property manager for a final check if the rents are key to the purchase price. Put these four data points together and you have a pretty solid estimate—without needing to ever leave your living room! We believe these data sets will only improve in the future as more data in available online.

4. Quick & Easy Marketing to Would-Be Sellers

Even just a couple years ago, the major way to find a deal in real estate was “driving for dollars.”  Think about how inefficient it is to get in a car and literally drive block by block trying to find an old, run-down house. Then you have to go knock on the door and see if the owner is home to try to negotiate to buy their house. Don’t get me wrong, driving for dollars is still a great way to get a deal. But it’s very hard to scale a business by driving for dollars.

Today, marketing can be almost 100 percent automated in the form of buying a database and targeting via online advertising. Just this week, we sent a message to 600 owners in Chester County, PA. All-in, it took about an hour to drill down to the right data set and another hour to properly set up the right message. I can’t imagine how long it would take to go knock on 600 doors!

5. Access to On-Market Deals

Many buyers scoff at buying properties on the MLS. I personally do not agree that you can’t find deals on the MLS. The key to buying on the MLS is to be ultra organized and very persistent. I think technology strongly helps in both of those areas. I keep updated filters in different markets to get notified when a property fits our criteria. Then I try to get an offer to the seller as soon as humanly possible. If the seller rejects the offer, we add the property to a database for followup at a later point if property is still on the market. But all of this is easier through using MLS filters, rather than relying on local signs, agents, etc.

6. Simple Ways to Evaluate the Deal

I highly recommend using Google’s shared spreadsheets to evaluate deals. I have a specific form that I put in for every deal. I share that model with our acquisition agents so they know exactly how we evaluate the deal. Then the agent puts the variables directly in the model so we can immediately evaluate the price we want to offer. We also have the agent upload the pictures/video of the property to Google Drive. This way, I can evaluate the expected maintenance cost in seconds.

SlateHouse Proprietary Investment Model

7. High-Tech CRM Lead Databases

Once you have a lead for an owner who wants to sell, a CRM database is crucial to staying organized to stay in touch with the owner until they eventually sell the property. There are many CRM databases out there in the marketplace. I think the key is to make sure you use at least one of them, rather than use your memory alone. We find that Google Sheets works fine, but know many investors use Salesforce and Podio. The key is to track the lead and follow up relentlessly. Without tech, followups just do not happen and leads never go anywhere in the future.

Related: 4 Ways Technology is Shaking Up Commercial Real Estate (& Why Multifamily Will Pull Ahead)

8. Useful Property Management Ledger/Databases

In my previous article, I covered the many technologies that property management companies leverage. One of those technologies is a back-end accounting database. This database is crucial for investors because they can track, manage, and optimize their properties quickly. I firmly believe that the sweet spot for investing success is to check-in against a data heavy dashboard with a property management on a weekly or every other week basis. This gives the investors an eye into what’s happening, but also the freedom to find more deals.

9. Valuable Online Communities

One of the best tech tools for investors is to be a part of an online community. For local knowledge, I recommend a local Facebook group. In Pennsylvania, we created a group for investors and joined another group specific to landlords. Both have been very beneficial, and I highly recommend creating one like this in your community. Of ourse, we also plug into the BiggerPockets forums, but you probably already guessed that!

Actual Post from Central PA Real Estate Investors Facebook Group

So, what technologies do you use that I missed?

Leave a note in the comments!

About Author

Chad Gallagher

Chad is the co-founder of SlateHouse Group . SlateHouse is a property management company in Pennsylvania and New Jersey that manages over 2,500 units, SlateHouse Plumbing and HVAC that works with all investors, and SlateHouse Realty with agents that focus on helping investors buy and sell real estate. Chad also leads SlateHouse Investments, which owns over 200 units. Chad obtained a degree in Systems Engineering from the University of Virginia and previously led the mobile division for Advertising.com which was eventually acquired by Verizon.

8 Comments

  1. Alex Bedar

    Hi
    You wrote on the 3d paragraph that: “Finally, we email a local property manager for a final check”
    How dose it works? you just find a property manager on google, and email him?
    What is the interest to the property meneger to answer you?
    Thanks

    • Chad Gallagher

      Alex — Good question. In our case — we actually own a property management in the areas we invest, so we ask our local property manager. But, I think most property managers are willing to help investors with rent estimates — they realize that by building a relationship with investors is a good thing. This is our approach in our regions with other investors.

      In terms of how to find a local PM company — you could totally just start with Google. If you know investors that use a certain PM company, you can ask them for contact info. If you are local, I’d also suggest going to a local real estate meetup.

  2. Egan Lohman

    Chad, just read your profile, you’re a beast! Great post btw. Regarding google sheets and CRMs, I’ve been struggling with this for a while now. I’ve been looking at HubSpot, but I keep finding gaps. I want a system that is as automated as possible, Ex:

    A birddog submits a lead through a form on my site -> that adds the address to my “assess deal” TODO list. Once marked as a “quality lead” it gets added to my “send mailer” TODO list, and tagged with which mailer to send. Ideally, mailers are sent automatically via API call to one of the mail providers (i.e. yellowletters.com), but regardless, a mailer list and schedule is maintained by the system. Eventually leads become deals, and the system needs to track the status/state of the deal.

    As a system’s engineer, it sounds like you’ve got all of this dialed already for your businesses. I’d love to know what tools, processes you used to get it setup and running. That would make a fantastic blog post 🙂

    Lastly, you say you have acquisition agents – who are these people? Are the full time employees? I have a network of bird dogs, but they just send me leads, they don’t analyse the deal for me. Very curious as to what these individuals do for you, and how you pay them.

    Best,

    Egan

    P.S: Congrats on your Super Bowl win – that was a great game!

    • Chad Gallagher

      Great questions! Yes, I should do a similar post on the CRM side of things, a lot goes into dialing that in.
      For your acquisition agent question — these are NOT employees. They are comped on their agent commission. The trick to getting an agent to help you put data into a model to analyze is to get an agent to buy in that you’ll be working with them on more than one deal. I find that any agent is who isn’t comfortable putting data into a model is probably not the right acquisition agent for us as we are pretty data driven. But most models aren’t too time consuming to enter data — and acts as a great way to organize all of the info. So bottom line — I think if you are using an agent to buy a property — it’s totally reasonable to have them enter data into a model for a prospective property.
      Thanks for the good questions. And yes, what an amazing Super Bowl!

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