By Ron Sudman
Every day people ask me, “How much should I budget for residential property management software/systems? “and that is just too broad of a question. A Fiat isn’t going to cost you much….. but that Tesla is going to be a touch more expensive.
So, in order to make sure you get the right software and systems for your residential property management company at the right price we first need to distinguish between the two.
What Are The Differences Between Property Management Software and Property Management Systems?
Many people think they are somewhat the same, but they are quite different.
Most property management companies purchase a property management software first thinking that will be the silver bullet to run their operations only to find out that property management software is just software, not “SYSTEMS”. You need both to have a successful operation.
Property Management Software:
The software processes rents, maintenance work orders, and manages a property management company’s operations, etc.
- The software also produces reports for owners, residents, and the property management company. In addition, it produces online communications with Owners and Residents giving them their own portal.
- Accessibility and Mobility: It provides the retrieval of data with almost any technology device
- Data Security: It protects data and allows you to recover that data if needed in a cloud base software especially.
- Marketing: It allows a property management company to do online property marketing at ease exposing properties for rent worldwide on all search engines.
- Scalability: Whether your company is managing one or a thousand properties it allows you to accomplish core functions with the flexibility that’s affordable.
The average cost of a property management software is $1.00 a door or $200 per month whichever is greater. There are software applications out there that you can get started for as little as $45 a month but you will have limited modules and options.
Most software’s have on boarding fees (this is a setup fee) that can range from $400 to $1000 or more.
If you have data to move over to the new software there can be an additional charge for that as well and prices vary.
There are 7-8 top property management software providers and the pricing is pretty consistent with all of them with come variable. Most have the same modules in accounting, maintenance, leasing, marketing, administrative, reporting, forms, letters, legal contracts. However, it’s important to note that the final cost will vary depending on a variety of factors and variables:
- Ease of use of the software
- Ramp up time
Training or lack thereof
These could add up to more than the software itself as the time you’re paying your staff to get ramped up and use the software day in and day out could be considerable and that’s an ongoing cost.
Property Management Systems:
A System is a group of related parts that move or work together. A set of detailed methods, procedures, and routines created to carry out a specific activity or workflow to complete a task.
An example of a maintenance repair. A Resident calls in a repair and here is an initial part of the SYSTEM for processing a maintenance repair. It would need these components before you ever get to the software:
- What questions does the property management representative ask the resident?
- What detail questions does the representative ask them to see if it’s an emergency or just a normal repair
- What answers does the representative give the resident on questions they have on how to handle the situation with the repair.
- What is the verbiage they use to get to the root of the repair?
- What is the process for selecting the right vendor to do the repair?
- What options can the representative give to the Resident if they have to be out of the property for a few days
- When will the repair be scheduled?
- Who will set the appointment with the Resident the vendor or the management company?
Once these questions are answered then you can enter the information into the software but only then. This is one initial step of a “SYSTEM” in processing a work order for a repair.
Much like McDonald’s while they have software to manage their operations, they have systems on how to cook a hamburger, for how long to cook it if you want it rare, medium or well done and exactly what goes on the hamburger bun first, second, etc and how it’s wrapped. This is what is considered a “SYSTEM”
Providers of property management systems vary greatly from a simple one manual on processes to full systems in every part of a property management company from accounting to leasing to maintenance, operations, hiring, etc. Much like you will see with a franchise.
The cost of property management systems can vary greatly as this is very new to the property management industry. But to give you some idea you can buy a maintenance system for $499.00. This just gives you a system for maintenance, for example, nothing else. While this will help, you be more efficient in maintenance it will not help in your overall operations.
If you purchase a complete property management system it could be $15,000 but this will give you all the property management systems you need to run your property management company much like if you purchased a franchise for example, but far less than a franchise.
Some systems do come with ongoing support which can range from $100 to $500 a month for a limited time to teach you how to use the systems, training, support and coaching so you can get the most out of the systems. Also, your ramp up time is far less since you can move much quicker in getting ramped up.
Systems will allow you to reduce cost in managing the same number of properties with less staff, reduces making costly mistakes and allows you to scale up quickly enabling you to grow faster which increases your revenue significantly.
Why Are Property Management Systems So Important?
People love to know they can count on something, that makes them feel secure since they know what the outcome will be. Using McDonald’s as an example their food tastes the same in New York, LA, Hong Kong or Australia. Why? Because of the systems.
When people know, they can count on something they keep coming back just like you and your kids may have for 40 years to McDonald’s and that creates brand loyalty.
But it’s even better than that. Systems retain customers, increases revenue and reduce marketing cost for a property management company and in some cases, reduces it all together so this is what “SYSTEMS” can do for a property management company.
At the NARPM National Associations Realtors Property Management conventions the number one topic has been Systems. In order to grow, have scalability and maintain quality customer service, systems are essential.
There are 3 options:
- If you’re a current property management company you can just buy a property management software and change your operations to match the software since the software company will not change their program to adapt to your operations.
- You can just buy a property management system and match your software to the systems as closely as you can. This works better than option one
- You can buy a property management system and software that’s integrated together and works as one. This works the best as they are fully integrated which creates high efficiency and reduces cost and simplifies all the systems.
Most property management companies end up with number one most of the time, but not by choice it’s really not the most efficient as you’re changing your operations to match a software. Your software should manage your operations.
New property management companies just starting out would benefit well in considering option 3. With that said current management companies would benefit greatly from an option 3 in the long term.
Aside From Cost for Residential Property Management Software and Systems
While cost will always be a factor, it should not be the only reason for selecting one plastic surgeon or practice over another. There are a variety of other elements to consider when making your decision:
- Systems provider experience
- Software provider experience
- Ratings and reviews
- What you feel most comfortable with
So, there you have it our prices for our residential property management systems and software. It’s important to remember that based on your timing these prices could be less, making the cost you pay out of pocket much less.
If you have any further questions about our prices or the details of our systems and software, feel free to contact us by clicking the link below or call us at 949-721-6695.
Schedule a free online consultation to find out more about your Property Management Systems and Software options, contact Management One at 949-721-6695 today or e-mail email@example.com. During your online consultation, you will have the chance to discuss your options with one of our seasoned property management executives to better understand the factors that will influence the cost of a property management systems and software.