Rentec Direct - Property Management Software

I wrote about Google Voice a while back and provided a detailed review of google voice right after it was released to the public.  Time really does fly, as I'm shocked to see that was 3 years ago back in 2009.  Since that time, Google Voice has become a valuable part of mine and many of our client's process.

Here's a complication of great reasons landlords and property managers are using google voice:

1. It's free!  This goes without saying, you can't get much good stuff for free these days; however, google voice continues to be an exception.  You get a free phone number, free online storage, free voicemail, free texts (sms), and free transcription.
2. Documentation.  More than ever, tenants are communicating with landlords via text message.  Most phones do not permanently store text messages, and even those that do stand to risk being lost and that documentation goes away forever.  If you use google voice for your tenant communications, those text messages are stored forever.  Read more on how documentation is a property managers best friend.
3. Privacy.  Many landlords do not want their tenants having their home phone or cell phone numbers.  With google voice, you can provide this number and re-direct it to any phone of your choosing, to ring at your choosing.  Don't want to receive calls from 9pm - 6am, no problem.
4. Multiple destinations.  With google voice you can configure roll-over so if you (or your employee) is not available at one number it tries another, which could even be another person.  This is a fully automatic, and free, way to gain the capabilities of an expensive phone system.
5. Did I mention documentation?  Having a permanent record of voicemails and text messages is critical in todays litigious environment.  Save everything, and google voice makes it really easy for voicemail and text messages.

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Nathan is a member of Rentec Direct who provides property management software, tenant ach payment processing, and tenant screening for property managers and landlords nationwide.

I subscribe to Google Alerts to alert me when something within my field pops up on the internet.  One such alert I received this morning was labeled "10 Myths about Web Based Property Management Software".   Obviously as I work with a web based property management software company this peaked my interest and I read the article.  It got me thinking, there is a lot of dis-information on the web.  This article I came across in particular wasn't entire inaccurate and it was just designed to plug their non-web based software; however, property management software aside, I would like to debunk some myths about Web Based Software in general.

First, my qualifications to write such an article.  I've been directly involved leading software development for both desktop applications as well as web applications since 1995.  Prior to that I regularly used the internet before most people had even heard of the internet, and before there was any such thing as web browser or HTML.  Anyone remember gopher or nntp?  I've got in-depth knowledge of both software development and the internet as a whole as I have been working with both every single day for nearly 17 years.

Myth #1 - Having data online (in the cloud) may be less secure and more prone to loss or being compromised than having it on a local application running on a workstation.

Myth #1 Debunked -  There's two components to this, and both are very inaccurate.   First, the security of the data not being lost.  It's a known fact that most people do not regularly backup their machines.  Even those that do rarely check to ensure the backups have worked.  Did you know that most backup programs do not backup open files (ie. an application left open does not get its data backed up).  It's also a known fact that the typical workstation (in an office or at home) fails on average every 4 years.  More people lose valuable data due to computer hardware failure than anything else and this is especially common among software that stores the data on the local computer. 

The second level of security is from hackers attempting to steal or destroy data.  It is more and more common for workstations to be compromised with viruses or malware.  Once a system is infected with a virus or malware, the hacker who wrote this software has full access to the data on the computer even if the data on the computer is password protected.  Password protection offers little to no security for locally stored data because once infected the virus or malware can simply read your password the next time it's typed in and they instantly gain access.

In contrast, reliable online software use state of the art servers and clusters to store the data.  Servers run a completely different operating system and as such most are completely impervious to standard viruses which are what cause workstation machines the most trouble.  Statistically a server is thousands of times less likely to contract a virus even if mis-managed, and well managed servers do not ever have a risk of getting a virus.  Servers also employ much more powerful and redundant equipment than workstations and the same 4 year failure rate does not apply.  Most servers run raid arrays for their data which means even in the event of a hardware failure there are backups which instantly take-over.  Other methods of security are redundant power supplies, frequent on-site and off-site backups, and 24x7 monitoring to ensure the utmost reliability.

As Myth Busters would say, this myth is BUSTED.

Myth #2 - Online based software run slower than a locally installed application.

Myth #2 Debunked - This myth states that because the software is web based the data has to travel thousands of miles back and forth before it can be displayed.  This one is not only mis-informed, but pretty silly to bring up in the first place.  Data on the internet travels at the speed of light, this is a known fact.  Most cloud based applications are located with 1000 cable miles of the subscriber.  So even accounting for network overhead and possible congestion, most web applications transfer the data between the server and the client (customer's monitor) in less than 50 milliseconds (yes, that's 5/100ths of a second).

The only way this myth could be true is if the user were stationed perhaps on..  Saturn.   Myth BUSTED.

Myth #3 - Web based software costs more.

Myth #3 Debunked - This certainly is going to vary from company to company; however, in general this myth could more often be proven false than true.  To provide specifics I'll talk about my industry.  I'll use a landlord who manages 125 properties as a mid-range example.  To utilize our property management software as a landlord with 125  properties the landlord would pay $44/month.  The software manufactures who make PC installed applications claim their software is a one-time cost and therefore the $44/mo will eventually exceed that one time cost.   To illustrate this better, I picked a competitor who provides PC based software that does the same thing as ours, and to keep it interesting I just used the same company who published the article that prompted me to write this piece.  To service the same 125 properties with their most comparable feature set, their application costs apx $750.  So if we ignore all other factors and only use their claim about a one-time purchase cost being the only cost, they would be right because in a little over 17 months the web based application would indeed start costing more.

However, they omit some very important facts.  PC based software doesn't get unlimited free and regular updates like web based software does.  This means, next year or the following year when the PC installed application releases a major update that is required for the industry; you guessed it, there's another $750 or an upgrade fee as some may offer.  Regular backups of the data have to also be considered which means a local backup solution or an online backup solution.  Either way, figure about $120/yr in either hardware or subscription.  Now the big missing piece.  Any serious business needs serious management of the computer(s) and data to ensure security and reliability are maintained.  This is either done by an in house network administrator ($45,000/yr +), or an outsourced service who maintains the PC(s) and data which can run as little as $100/mo.  Yes, this last step could be skipped at the risk of losing your data or having it stolen, either of which could instantly ruin a business, so I certainly recommend against that.

Now that we have all the facts, we'll take the most conservative prices in the price range for the PC based application and compare the real facts:

Web Based Total Cost of Ownership for Three Years:  $1,584
PC Based Total Cost of Ownership for Three Years: $5,460
This one is BUSTED!

Now just like picking a mechanic, or a software vendor, it's important to pick a trusted company.  I speak from experience from companies I've been involved in, and the above busted myths are all true when dealing with a solid, reputable, and experienced company.  This doesn't mean all companies have those traits, and just like a PC based application maker can make a really poor application, so can web based.  Be sure to look for independent reviews, 3rd party endorsement, certification, or accreditation before picking a company which will shape the face of your business or lifestyle.

Those are the top three myths which I see the most confusion about in the industry.  As is apparent the PC based application vendors are just doing their job, trying to sell their product, and like so many sales organizations they minimize or stretch the facts to sell their product.  Unfortunately this isn't uncommon in sales organizations; however, now you know the facts!

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The author is a founder and user of Rentec Direct.  Rentec Direct provides property management software that includes ach for landlords and tenant screening.

US Census 2010 data shows that rental vacancy rates are at the highest points they've been since the 1950s when the data begun being tracked.   Today rental vacancy rates are 10.6% or 1 in 10 homes do not have a tenant.  One might ponder; how can this be given all the foreclosures and new renters in the market?

There are 3 primary reasons and by taking a few critical steps you can cut your vacancy rates in half or more.  Read on if you are a property manager or landlord and don't want to fall into the trap so many other property managers have in today's declining real-estate market.

1. We're in a recession.  Despite our government telling us it was over in 2009; it's not for most of us, especially those in the real-estate or property management business.  Because times are tight right now owners are skimping on maintenance such as putting off the new paint job or new carpet until next year when times are better.  That line of thinking will ensure that next year will be no better.  The maintenance has to be done eventually anyways, and if the money to do it can be scraped up to repair the problem today, the outlook for tomorrow will be much better because your vacancy rates are going to go down.  Fact is, tenants do shop and it is more of a tenant's market today than ever, so if there is a better house available (that doesn't need new carpet for instance), you are going to lose that tenant.  If you manage your own properties make the decision to keep up the maintenance, and if you manage somebody elses properties, provide them this compelling data so they will.  Pay specific attention to these items, in order of importance:  Exterior paint, front yard landscaping, front door and entryway, living area & kitchen.
    
2. Who is your customer?  Running a property management software service we hear from a lot of property managers, owners, as well as tenants.  What is the #1 gripe from tenants these days we're hearing?  "We're not treated with respect".  Property managers often forget that their customer is the tenant.  It can be easy for us to get wound up in the screening process and be so strict, for the protection of the property, that we reduce our friendliness to the prospective tenant.  Make your customer love you and they will not go somewhere else!  This starts with the application process, showing the property, and the continued relationship.  One huge mistake in this process we see time and time again is making the tenant wait on your schedule to see a property.  If a property cannot be shown until tomorrow and they can see a property today from your competitor you just lost a customer and have done a disservice to your client, the property owner, by further increasing their vacancy rate.  I feel it's important to have the staffing available to bend over backwards for tenants and treat them as equals, or better yet, in the same way you would treat a property owner looking for a manager, in the utmost respect and courtesy.
    
3. Do it better.  Great property managers and landlords today are providing services to their tenants to make their lives easier.  Make your tenants fall in love with you by providing them something that makes their lives easier and most importantly, something they won't get if they move away.  Be creative, every market is different; however, here are a few examples that work in almost every market. 
   
   Offer automated ACH.  Automated ACH not only makes your tenant's life easier because the rent happens automatically, but it also increases your retention rate and level of importance for a tenants monthly expenses.  It's also been observed that an automated payment isn't as emotionally stressful to a tenant as if they have to write a check each month for what is often their largest monthly bill.
   
   Offer a tenant portal.  80%+ of your tenants today have online access and that number steadily grows every year.  Tenants check their bank balances online, pay their bills online, and merchants have embraced online tools to save them time and money along with providing an extra convenience to their customers.  These same tools are available to landlords now, and if you aren't providing them and your competitors are, guess who's making their tenants more happy which is equating to longer term tenants and lower vacancy rates.
   
   Keep up on maintenance.  Even when occupied it's important to inspect and maintain a property.  More often than not your tenants are not cleaning the carpets or painting the walls.  If the home gets run-down, even if it is the fault of the tenant, they will feel less happy with the home and always be eying a fresh new place to live that is being kept up.  There's an emotional factor to a clean, maintained home that keeps tenants longer.

1) Vacancy Data Source:  http://www.census.gov/hhes/www/housing/hvs/historic/files/histtab1.xls

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The author is a founding member of Rentec Direct.  Rentec Direct provides property management software which includes ach for landlords, tenant screening, and online documentation and file storage.  While the above article may speak of products we offer or use screenshots from a product we offer, we encourage landlords to do their research and make up their own minds when selecting a new product.  That said, we of course welcome ActiveRain members with open arms.

Here at Rentec Direct we’re always testing out the capabilities of web browsers.  Our application makes use of some of the latest web technologies so it is important that browsers perform to make sure users’ experience is not just good, but great!

For a very long time the best combination of performance and security has come from Firefox.  Firefox is an open source application which has the most community support behind it for a web browser.  Because of the ample community support, and excellent programmers, Firefox leads the way still in performance and security.

Google Chrome just yesterday released version 5 of their new browser.  We’ve been using and testing with Chrome since version 3 and it has come a long way.  Chrome takes the cake in performance, even over Firefox.  Google Chrome 5 can rightfully claim the title as the fastest browser in the world, at least for now.  In our testing, Chrome 5 is noticeably faster all around the web.  It has native Flash support to give you the full web without installing any plugins and works very well with all websites we’ve tested it with, including Rentec’s BackOffice which makes use of many new web technologies.  Of note, with Chrome version 5, they now support plugins including some one of our “must have” favorites: Xmarks.

Other popular browsers include Microsoft’s Internet Explorer (IE) and Apple’s Safari browsers.  Neither has the performance and security that Firefox and Chrome have, therefore we recommend using one of the above.

If you are looking to speed up your web experience, try out the new Chrome, or if you are currently using IE try them both and see which fits your style best.  You will find your internet experience will improve significantly when you release that old slow browser.

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This author is a founding member of Rentec Direct.  Rentec Direct offers ach for landlords, tenant screening, and of course property management software to simplify and organize your property management accounting.  While the above article may speak of products we offer or use screenshots from a product we offer, we encourage landlords to do their research and make up their own minds when selecting a new product.  That said, we of course welcome new customers with open arms.

So nearly twenty years ago I setup my first banking relationship with a small local credit union.  Granted I was 14 at the time and it was really my parents that set it up for me, but I think there's something to be learned from this.  As I ventured out on my own I decided it best to use a big well known bank such as Wells Fargo to bank with.  I was thinking it provided me more security for my assets and a bigger bank knew what they were doing better, right?

I've recently come to some conclusions which are pushing me to re-think my decision.  Granted a lot of this has to do with the current credit crunch, and banks just tightening down in general; however, here's what I've found.

My big bank sucks!  Not only that, they are expensive.  And not only that, they treat their customers like dirt.  I walked in the other day to cash a 3rd party check, as I had done on many past occassions.  Whenever there was any question about who I was or what the bank was going to do for me, a teller might call over the manager, who had visited my business a year prior and knew me well.  I also maintained balances in all my accounts well enough to cover the check if for any reason it didn't clear.  Well my story starts right here.  The teller said No.  It wasn't a "I'll check", or a "Let me get approval for you", it was a flat "no, we don't do that any more".  Naturally, having done this many times previously I asked to speak with her manager.  It was also an urgent matter.

Here's where the second bit of change comes in.  The manager I knew and liked was no longer there.  The new manager says "the teller is telling you the fact, we don't do that anymore".  I pointed out I had enough funds to cover any problems, and reminded them I could take my banking elsewhere.  It didn't matter, they refused to serve me.  Keep in mind, I'm a very long term customer at this point who has not once ever bounced a check or had even a single late payment with this bank.

It must have been within a week after this issue that I got a letter from the bank.  I really wasn't expecting anything, but upon opening it my 2nd bit of big bank news arrives.  It went something like this:  "the credit card you have with us is going up to to 18% interest".  Wow, are you kidding me?  I maintain decent balances in my accounts for money you can then use for investing and loaning.  The bank then pays me virtually nothing in interest.  I think Wells Fargo currently pays right near .2% interest; it might and probably is even lower.  All this and for a person who has excellent credit, and has never ever ever had a late payment to them or any other bank, they are raising the rate up nearly 10 points.  Why?  Simple answer is they are greedy, and because they can.

So my days of doing business with this bank are certainly numbered, especially since I discovered an alternative.  Taking a lesson from my parents twenty years ago, and having heard local radio advertisments for them for years, I decided to step into one of our hometown local banks.  Here's what I found:

1. The 3rd party check is no problem, so long as I have the balance to cover them until they clear.

2. The same people have worked at this bank for 10-20 years.  They don't have high employee turnover such as my old bank.

3. They pay me to put my money there!  Currently they are paying 1.5% on money just sitting in a checking account, which honestly is the most convenient place for it for me for ultimate liquidity.  They pay more on CDs and other savings vessels too.

4. The people are friendly and want to help, in contrast to Wells Fargo's policy of quoting corporate scripture.

The only downside thus far about banking local are a couple conveniences which I've come to rely on over the years.  This is making the transition take a bit longer.

1. Their ATM doesn't accept deposits.  They do take deposits at the teller or nightly drop box.  So now I print a deposit receipt from my favorite property management software, and just drop an envelope in the night drop box. 

2. I haven't been able to successfully tie my bank accounts in with my personal finance software.  I am told it is possible; however, it's clearly not as easy as it was with the old bank.

So to you AR members.  Where do you bank?  Big faceless policy driven bank, or a local one?

--- about the author ---

Rentec Direct provides property management software free to landlords and property managers. Because of the importance of thorough screening for prospective tenants, we have integrated tenant screening directly into the software so in just a few clicks a complete and comprehensive background check including previous evictions can be done on any new tenants.

We just purchased our 2nd foreclosed property from the bank this year, done some additional research, and determined banks are really anxious to offload their inventory.  Their anxiety is so high they are willing to offload them for just about anything (within reason) which spells a very profitable investment.

To add to this, lending guidelines are still pretty tight.  While they have loosened up a little bit, the economy (for the avg Joe, not the media) continues to worsen.  This means less money in people's bank accounts.  The $8k 1st time homebuyer credit helps confidence, but it doesn't give homebuyers the money *today* to put down on a property.  What's happening?  These banks are desperate to offload inventory, they are accepting offers, but many of the "prequalified" buyers are falling through and not able to purchase.

This type of situation really puts the bank into dire straights.  The bank was expecting the property sold by X date, and the buyer fell through.  The house goes back on the MLS, typically at a heavy discount, and really the bank will take just about anything for it at this point.

To illustrate the point, I'm changing names to protect the guilty. ;)  The Smiths are prequalified and have put in a full price $180k offer on 123 Smith St.  The bank see's dollar signs and accepts and believes because they are "prequalified" they will follow through.  15 days into escrow, the Smiths find out the loan is a full point higher than they expected, and back out.  The bank has lost nearly a full month at this point and has to relist the property.  They NEED to sell it now.  They drop the price 9% and offer 3% closing assistance.  A 12% reduction in a matter of 30 days.  Any investor with the dollars to put down can snatch this property up at a heavy discount.

Granted every situation is different, and some lenders will re-list at the original price; however, I'm willing to bet that more often than not they will take an offer 10-15% lower than their asking price in situations like this.  Keep an eye out on the MLS for re-listings to spot these.  They are a gold mine.

Of course once you have it, be sure to keep it on track and positive cash flow so it doesn't end up back at the bank again.  I recommend using property management software to track closely the finances of each property.  Make sure you are receiving a decent return on your down payment (8% minimum, ideally 12% or higher).  And if you are renting, be absolutely certain to screen your tenants carefully.  Nothing can make a positive cash-flow property turn negative quicker than bad tenants.