The Essential Guide to Rental Property Management Systems
My greatest challenge as a real estate manager is wearing all the hats required to be successful. This was especially true when I had just started out. Real estate management isn’t for those who are purely marketers or accountants — it’s broader than that. In this industry You have to do everything. In general, you need to be able to identify problems and solve those problems. That’s the stuff of managing real estate.
That’s why you need to create systems.
Why Create Systems?
You don’t want to go without systems because you won’t grow your business like that. You have to be willing and able to defer responsibility, because while you can wear a million hats at once, you can’t do that for long. If you create systems, you will take the load off your shoulders, multiply your efforts, and increase your effectiveness as business leader in today’s technology culture. You can replicate systems, but you can’t replicate yourself.
For example, instead of doing one task 100 times over again, you can send a “how to guide” to 100 people and have 100 people do it the same way as you. That’s how to make money.
A Story from History
That’s what make Walt Disney money. While this isn’t an example from real estate management, it’s profoundly true as a business principle. Back when Walt Disney was still a young entrepreneur in Los Angeles, California trying to make his way in animation, he decided that he wanted to do what had never been done before: create the first feature length animation.
He had a small animation company (this is back in the 1930s), and he had been working with handful of animators on short films. But when it came time for innovating the first feature-length animation (Snow White and the Seven Dwarfs), he had to scale his model to finish the film in a reasonable amount of time. So he:
- Got a loan
- Hired hundreds of animators
- Created training programs for his animators
- Made templates for his animators to use
- Developed systems for managing production
In addition to hiring a large staff to create the drawings (at the time, every single frame was drawn separately by hand), he invented the first “multi-plane camera” to create a three-dimensional feel to his film. These among other elements enabled Disney to make millions of dollars, when that amount of revenue was unprecedented in his industry. Walt Disney only accomplished this by creating systems and by using technology to scale his business.
Systems and Real Estate
It’s the same with real estate and with any business—if you want to scale, you need systems.
The problem is making systems both digestible and detailed for your team. Once you’ve decided that you need to make systems, making them “idiot proof” is your greatest challenge. It’s taking every hat you’ve worn and making it possible for your team to wear that hat. Your systems make sense to you, but since you’re in the weeds, they might not make sense to anyone else — even those on the inside!
There are intricate nuances involved in developing systems for managing real estate (including buying and selling properties). Once you’ve got the system down, you need to explain the system itself, and this is an art and a skill to learn. In the end, you have to make your systems repeatable and applicable without your immediate input.
That’s why you need tools for creating and implementing systems.
17 Essential Tech Tools for Real Estate Managers
I will go to the mat for technology and tools. If you want to scale your business in the world today — almost any business out there — you need to utilize current technology. That’s why I’ve taken the time to pass on to you the most essential web-based tools for the Real Estate industry, for those who want to buy, sell, manage, lease, or renovate properties of any type.
Additionally, almost all the applications I use are cloud-based. This is what I recommend to you: Try not to use anything that’s native (i.e., hosted on your server, not on a cloud-based server). By using cloud-based applications, you have the flexibility you need to access your files from anywhere—from your phone, your computer, or even remotely. This helps you to manage your team when you’re not in the same room, and if you’re managing real estate, it’s rare that you’re meeting face to face with your tenants or property managers every day. You need systems and tools to manage those systems.
You will notice that I don’t believe in using paper. I believe it exists, don’t get me wrong, but it’s a waste of time in this industry. You need to become hyper efficient, because if you don’t, your competition will grow past you. The way to become hyper efficient in this business is first by going paperless.
Every application I mention below aims at paperless systems:
- G Suite
- Quickbooks Online
- Traveling Mailbox
- Ring Central
So why do I recommend going paperless? Not only is it good for the environment, but it enables you to be hyper efficient. For example, if you need to sign a contract or an agreement, you can do it all paperless. If you had to sign a document in times past, it took a long time! You had to:
- Open the mail
- Sign the document
- Have the document notarized locally
- Scan the document
- Or mail it
That takes too much time in today’s marketplace. There’s a way to be more efficient, even hyper efficient. My goal is to help you to become more efficient and get more done (without the headache) by going paperless and using applications that replace your paper-filing systems.
What if your papers get lost? Going paperless doesn’t mean losing documents from a computer crash. In fact, it can be significantly safer than having physical documents, because you don’t have to protect against fire damage, water damage, or misplacing files. If you’re worried about going paperless, remember that:
- You can backup your digital files easily
- Save physical space by having digital files
- Documents are now word searchable
Many applications are now word searchable, so you don’t have to be as meticulous filing things. Even down to handwriting! For example, Evernote can scan your typed and hand-written words. This is the first of 17 web-based applications that will make you more efficient in buying, selling, leasing, managing, and renovating real estate.
Internal Communications: Creating Systems to Manage Your Rental Property Team
This is your document repository. Another major element of going paperless, is having a place to keep all your documents. Evernote allows you to do this. It’s excellent for any static documents (those pieces of information that don’t change). This includes:
- Anything that needs to be filed!
This makes your entire filing cabinet wherever you go.
Reasons to use Evernote as a cloud-based service for your documents:
- Reliability then because it’s cloud based with redundant servers
- Optical character recognition capability
- Combine and edit an mp3, videos, jpegs, and your own annotations all in one document
- Compliments your filing system
- Easily sharable
This is a messaging platform that enables you to can communicate with what seems like limitless people at one time. Why not emailing for sending messages? Slack enables you to do so much more and all in one place:
- Share files
- Have conferences
- Chat rooms
- Private messages
- Tracks conversations
- Share links
Initially you don’t need this type of application, but if you want to scale, you’ve got to scale with Slack. Phone calls are one of the most inconvenient things to deal with during the day. I recognize the value of a phone conversation, but in my opinion, 90 percent of distractions can wait. Hyper efficiency is key, because speed is name of the game. Slack helps you become hyper efficient. If you want to deal with a team of 18 people, for example, you need be able to communicate effectively and affordably.
Currently, as an extension of Slack’s services, Screenhero offers video chatting, screensharing, and more. Slack bought them in 2015 to expand their offerings. Screenhero offers a similar product to Skype and it currently does even more.
Use this application once you start scaling. At that point you’ll need to accomplish tasks like remote training sessions. Screenhero helps you to increase your business remotely, especially with training sessions. You can video with everyone, screen share (control their computer), and show them how to use the tools — all remotely. It’s a great tool for:
- On boarding
This tool is a way for teams to track work. In my opinion, Asana is a to do list on steroids if that were possible. They’ve integrated their tool with Google drive, Evernote, and Slack, so you can see why I like it so much! Essentially, it’s a task management tool for your whole team.
Why for property? Tracking things. Managing your properties or for someone else, you need to record everything you’ve done. You can also search tasks effectively. This organizes tasks, communicates effectively, and gets stuff done.
This is Google Docs, Google Sheets, Google Drive, and more that can basically serve as your Microsoft Office. (Even though Microsoft’s apps are largely cloud-based now, I still like this better.) G Suite is everything I need for managing my living documents all in one place.
Why not use Evernote for documents? Google Suite is for dynamic documents, whereas Evernote is where I keep my static documents. Anything that needs to be modified I keep in G Suite:
Plus G Suite integrates with the other platforms I use!
This is time-recording application for employees to clock in and clock out from any location using a smartphone. T-Sheets even tracks their GPS location every fifteen minutes. This especially helps with tracking timesheets and accounting for renovations. You can see when and how long workers stay at one location.
Accounting: Creating systems for managing your money
I’ll just shoot straight: If you don’t budget well, you’re dead. This is true for business in general, and it’s true for property management. Accounting for your income and expenses is like the inhaling and exhaling of any business. You can’t run your business without solid accounting, just like you can’t live your life without breathing.
Quickbooks Online is great for property management in particular allows you to:
- Bill you clients digitally
- Track your income
- Track your expenses
- Account for the business side of owning a company
All of these applications are cloud-based. Nothing is native, because this makes things flexible and mobile accessible. If you don’t budget well, you’re dead. Accounting for income and expenses is the inhalation and exhalation of living.
This is accounting software you need to track accounting relating to actual operations of the property itself. My recommendation is to start with QuickBooks and then, once you grow, use Appfolio. Because it’s a higher priceline, you want to graduate to Appfolio as you need more sophisticated features — those which AppFolio offers. This app allows you to
- Pay bills
- Track operations
This application is a cloud-based home building software specifically for residential builders and remodelers. Buildertrend predetermines and itemizes every item you need for building and remodeling homes. While a spreadsheet could suffice for the process of estimations and tracking, you will do well to have some type of job-costing software. QuickBooks has templates for basic construction cost codes, but this feature, along with using spreadsheets, requires a lot of manual data entry. That’s why I recommend an application like Buildertrend.
Furthering the mantra of running a paperfree operation, DocuSign gives you the ability to instantly execute documents. This is critical because (I believe) 90 percent of decisions are emotional. If you can meet a tenant and they’re excited about what they’re potentially renting and you can have them sign right there, you will capitalize on the emotional decision to act immediately and the instant gratification that’s critical in this business. Now you’re locked in! You’ve got that customer now. All you have to do is click a few times, and without a physical signature, you can get the documents signed that you need to close the deal.
Time kills all deals, and DocuSign removes time (and paper) from the equation. This is true of contracts to buy property, start leases, get letters signed by residents. This is just another facit of being hyper efficient.
External Communications: Creating systems to manage your communications with clients, buyers, and tenants—and everyone else!
This is a virtual post office box. You get a physical mailing address, where they scan all your mail. You can get this
- Forward the mail to another address
- Send the mail to you as a PDF
- Shred it
The point of Traveling Mailbox is that it removes the necessity of having a physical office. That’s worth its weight in gold for the self-starter or small company who wants to minimize (literal) overhead costs.
This is a rental workspace company. This is another idea to complement a virtual post office box is a virtual office like Regus. Regus enables businesses to rent a share in an office, which enables business owners to claim the office as their own. This is more than just a nominal office, though. Not only does it make you look legitimate, but you can actually use the space to meet clients or work in one of the offices. It’s your own office, but only when you need it.
It’s very affordable. Using this type of service is how I started, and it enabled me to create my own property management company for cheap, without paying $2,000-3,000 per month on office space, desks, and administrative staff.
This is a digital phone line. If you have employees working from out of the region, state, or even from abroad, they can have a local number in your area. Plus all faxes are digitized and made into PDFs. Companies like Ring Central make for a paperfree operation.
This is great, because you don’t want to give out your cell phone number to tenants or to others involved with your real estate. Using something like Ring Central gives you a way to insulate yourself from your business so you can have a personal life. It’s an office phone that you can keep in your pocket! Also, you can have phone conferencing, answering systems, and faxes without physical landline.
This is your digitally out-going mail service. It’s the reverse of traveling mailbox. Click2Mail removes yourself from having to deal with mail. It enables you to send letters or notices digitally:
- You upload a document and addresses
- They print it
- They stamp it
- They send it!
For example, if you’re communicating with tenants who respond best to physcial mailers, you’ve got to communicate through sending physical letters and notices. Click2Mail’s fee is nominal and totally worth it.
This is a way to manage and track customer service interactions. Zendesk integrates with other platforms I use. I’ve tried Desk.com and ZipN, and this one fits my needs the best. It’s simple and functional — that’s why I like it. They offer a miriad of choices for your customer service needs. For example, you can add chat windows to your website, tracks phone calls, and triage incoming communications. Basically, Zendesk organizes you communications between vendors, residents, and owners. If you have maintenance orders to receive and place work orders, for example, Zendesk funnels those to your team and communicates with those involved.
This is a way to manage your relationship with residents. Call-Em-All offers voice broadcasting and group texting services, and these help you communicate effectively with residents. For example, if you need to send a mass message to everyone through voice or text messaging, you simply create the message, send it, and you can even analyze the results!
This is marketing software for leasing and selling real estate. Point2 allows you to market on most real estate websites using one singular platform. Marketing platform for leasing, sales, rent, etcetera. There’s probably more sophisticaled software out there, but this one works for me and always has. It’s efficient and it works. Helps me spend less time on Craigslist!
Top Tips for Creating Systems
What do systems mean in property management? When I’m talking about creating systems for property management, I mean the steps for what you do as a manager. This includes protocol, parameters, and instructions to everything you do.
How to Start Creating Systems
So how do you start creating systems? Record everything you do. If you write an email, make a template so your administrator can follow it when they come on board.
My Top Advice
Once you’ve begun your journey of creating systems, my next piece of advice is continually refine your systems, because they should be a living, breathing organism. If you’re not creating new systems and polishing them, you aren’t growing. You also need to teach other people how to create systems! Then, you’re in the business of creating meta-systems. Instead of you doing marketing for properties, you have your property manager just modify a template you’ve already created. This means you create meta-systems (i.e, systems of systems). You will need to have systems for creating new systems as you increase your business and add new staff members and contract workers.