In the days of old, men of business used many tools to help them ply their trade, but there was one with which they absolutely could not live without, their secretary. At the desk just outside their office sat the human equivalent of a computer. One instruction to her and important phone numbers, addresses, and information about leads were quickly produced exchange for a living wage. Times have changed and with it, so have the tools of business. Today, information is stored and accessed via the applications and software installed within our desktop and mobile devices. This article seeks to act as a simple guide to the basics of real estate investing software needs.
There are very few people unfamiliar with Microsoft Office and the accompanying programs. Because Office is so prevalent, it’s easy to overlook it as an important tool for business. The truth, however, is that Excel is a very affordable and useful program for business, and especially real estate investment, because it is easy to use and lends itself to financial tracking. In addition, most real estate investing software is Excel based, sharing the same formulas and principals. Therefore, Excel may function well for your business long into the future, or can serve as a training program for more advanced software which you may need to purchase as your business grows. If you’re looking for a more accounting based program, QuickBooks and other accounting software have stood the test of time. In addition to being able to track cash flow and expenses, QuickBooks offers an online payroll system for small businesses which includes tools for paying taxes, making yearly accounting easy and worry-free, and a useful additional real estate investing software.
Residential Real Estate
When it comes to residential real estate investing software, programs are generally divided between those which track and analyze inventory to be flipped and those which manage rental units.
Real estate investing software aimed toward flippers is more analytical in nature. Users input data such as purchase price, rehab costs, and improved value in order to analyze the financial potential of deal before making a purchase. During the project, the program tracks the changing data and adjusts the outcome so that you, as a real estate investor, are always in tune with where your project stands now and where it will finish. Rehabvaluator is an example of a program for flippers which offers lifetime access to basic features at no cost, with the option to upgrade to a more comprehensive program at any time for a fee.
If you find yourself flipping and renting out units and would like a more inclusive software package, try RentalSoftware.com. This package, and others like it offer deal analysis for potential flips and rentals, but they can be costly. You do get what you pay for with fee-based programs, however,you can expect a reliable call-center staffed with knowledgeable employees who can walk you through using the software in real-time as you analyze a deal.
If you are investing in real estate investor software focusing on rental properties, and your portfolio is growing, it is a good idea to invest in a software program which can track your various properties, the cash flow of your business, and provide a conduit between you and your renters. These programs are referred to as ‘property management systems’ and that is precisely what they do. Property management systems can be quite costly even at the most basic level, but they are not meant for the investor who owns 4 to 10 units in a building or two. Once a portfolio grows to a level where it becomes difficult to track maintenance costs, rents, late fees, utilities, etc. it should be producing enough income to justify the purchase price and monthly fees associated with a software system which can wrangle all of those elements into a neat package. An example of a property management software system for real estate investors is the highly rated Buildium. Not only do these professional software systems track accounting and payments, they also offers ports for the property manager and residents to make and receive payments and communicate.
The more units and projects your business takes on, the more is expected of you, and the same goes for your real estate investing software. When a portfolio consists of flips, income properties, and commercial deals, you should start looking at programs which combine all of the functions into one system. Integration of software will make it easier for you and those you work with to get done what needs to be done easily by putting all of the information and tools into one place. Software such as Real Data (which also works for smaller portfolios) and reiblackbook combine contact management, lead generation, and profit analysis. In addition, reiblackbook has an automated marketing tool. Both programs come with a free demo which investors can use prior to making a decision purchase
No task can be accomplished without the proper tools, and real estate investment is no exception. Consider your business’ needs and what tools are needed to fulfill them. Once you know what you need, start test-driving programs. Software is a key piece of your business puzzle, so don’t settle until you find the one that fits.