Many landlords face this question: Rental software vs property manager? We will cover this topic in detail and help you understand the options and benefits of each.
What can a property manager do for you?
Private landlords often hire property managers for the purpose of supervising daily operations and overseeing a property or properties on their behalf. This includes:
- Marketing and leasing out the property
- Managing the tenants and Collecting rent
- Ensuring that everything is in order with the property (Maintenance)
- Monthly reporting of income and expenses
A property manager can be an individual or an entity that offers their services and expertise so you are left worry-free. They can be a huge asset to your business, but they don’t come cheap.
Luckily, in this age and time, new software can accomplish the things that a property manager can do and more!
What can property management software do for landlords?
There are software solutions that assist private landlords with expense management, rent collection, cash flow insights, and tenant monitoring. Without charging a fee, this custom financial technology was developed to help independent landlords to bypass the need to hire property management companies and handle the details themselves.
Historically, property owners and independent landlords have wanted to manage everything themselves, but the business prowess that management companies brought was just out of reach. Now, with new software products like Baselane, private landlords can access powerful tools that can match and even exceed the efficiencies available from companies, benefiting themselves and the tenants alike.
How much does a property manager cost?
The primary motivation for doing it yourself when it comes to property management always used to be saving money. Prices vary depending on the property management company but could cost between 8% and 12% of the monthly rent.
Private landlords may need to pay between $160 and $240 per month on a $2,000-per-month property, that’s $1,920 to $2,880 per year. But are you willing to hand over all of your earnings for a month (or more) to a management firm?
Once you factor in all of your other landlord expenses, the price you pay starts to add up.
Speaking of expenses, private landlords tend to overlook accounting and managing their cash flow. These tasks are often tedious and difficult but essential to increasing profits. This is another reason why some independent landlords tap the services of property management companies.
While most property managers can handle listing and renting a property, collecting rent and managing expenses and tenant management, not all are setup to provide financial reporting and track performance across your portfolio. Now all these financial services are available in software packages, lessening the need for the management company.
How much does property management software cost?
Baselane, for example, is a completely free landlord software made available to both private landlords and renters. Banking experience is made so much easier with the ability to make sub-accounts to keep everything organized.
As a landlord, you also pay taxes based on your rental income and expenses. With Baselane, you can tag, track and organize your transactions for monthly performance reporting and end of year taxes with a single click. Bookkeeping is made easy when everything is laid out in one single platform organized by dates and equipped with features that allow you to hide, show or add receipts to your transactions.
Once your tenant has activated their account and has linked their payment method of choice, scheduled payments are automatically made without the need to chase them for it. Everything is made easier as it allows tenants to pay rent conveniently online. The best part is that software providers like Baselane consistently develop their features to provide the best experience for every private landlord and tenant.
Property Manager vs Property Management Software: The Final Verdict
With a system in place for marketing, screening, collecting rent, and tracking expenses, you might be surprised at how much you can actually accomplish on your own while generating revenue. You can start earning more money on your investment without the help of a property management company if you have the right tools and software.
For a private landlord, managing a property is difficult enough. There are numerous repairs, maintenance tasks, and legal paperwork that must be completed. Managing an investment can be challenging at times, particularly when it comes to keeping track of all the requirements that must be met prior to entering into new leases or legally selling homes.
In our view, property management software wins. While this software makes the day-to-day management of your property easier, it also gives you more oversight and control. As a landlord, you will save time on tedious tasks like rent collection and account management, and you won’t have to hand over your books, or your hard earned profit, to another company or manager.
As you buy more properties, you may want to reevaluate your needs, but for private landlords starting out, or looking to start growing their portfolio, software is the way to go.