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Month: February 2017

Buildium vs Appfolio

Buildium vs Appfolio

Buildium vs. Appfolio is one of the burning questions in the world of property management today. You know that you have apps available to help make all the day-in, day-out drudgery of managing your properties simple. You know this will give you more time to focus on areas of your business that really matter, really require your attention and offer the prospect of growing your investments. What you don’t know, however, is which is the best platform for you. Here’s the lowdown on making the right decision on the question of Buildium vs. Appfolio.

Buildium vs. Appfolio: The Tale of the Tape

Looking at some of the basics is the first place to start making the right decision regarding Buildium vs. Appfolio.

  • Buildium is only for residential properties, while Appfolio is for both residential and commercial properties. Thus, Buildium tends to be more popular with smaller renters while Appfolio tends to be more popular with large commercial landlords.
  • Another reason Buildium tends to be more popular with smaller renters is the price point for managing fewer than 20 properties. The basic Buildium costs $45 per month, with a Pro version available for $120 per month. Appfolio starts at $250 per month.
  • For between 20 and 100 properties, the prices become significantly closer. Buildium clocks in at $150 per month for the basic program and $200 per month for Pro. Appfolio starts, again, at $250 per month.
  • Each require a fee to get your account started and again, the price difference is stark. Buildium costs $99 to get started with, while Appfolio will cost you a whopping $400 just to get started.
  • Each offer customer service, however, Buildium’s runs from 9 a.m. until 8 p.m., while Appfolio’s is open only from 8 a.m. to 5 p.m.
  • Buildium is the clear favorite when it comes to marketing your properties. It allows you to create a basic website, and this is included in the cost. You can also post directly to websites like Zillow and HotPads from Buildium. Appfolio offers the latter feature, but making a website will cost you an extra $50 per month — with a $1000 setup fee, the cost is reoccurring Appfolio problem.
  • Both allow you to receive payments online and conduct credit, criminal and eviction checks. However, Buildium requires a $99 setup fee to begin receiving online payments.

In terms of basic features, Buildium is the clear favorite online property management software, especially for smaller renters managing a handful of properties. It provides many of the same features as Appfolio, some of which (such as customer service) stand out above and beyond Appfolio for a fraction of the price.

However, Appfolio excels in other ways. First, you simply can’t manage commercial properties using Buildium. It’s just not an option. And, while Buildium can manage over 10,000 units, it’s not generally preferred by real estate companies with large and diverse portfolios. That honor goes to Appfolio. They’ve made such an effort to get big-time real estate investors buying into their brand that they seem to neglect or even price out smaller real estate investors. In fact, the prices are much lower at per-unit cost once you hit 100 units on Appfolio.

Buildium vs. Appfolio: Making the Final Decision

The good news is that both platforms offer free trials allowing you to see which works best for you. You can try Buildium for 15 days. No credit card is required for a sign up. Appfolio also offers a demo version for you to try without entering your credit card information. There’s never any substitute for trying out an application and seeing which is most intuitive to you; which fits best with your business and its rhythms and flows.

But there’s the small matter of price. Particularly for single property landlords and smaller-investors (those with 100 units or less), the price difference between these two platforms will be significant. On the other hand, however, just because your organization has the money to throw down for Appfolio, that doesn’t mean that you ought to. Try out both platforms, compare their features side by side, then see which is the best fit for the daily needs of your company. Only after you do that can you make an informed decision about whether or not the cost is ultimately worth it.

The Hidden Value of LLC’s

The Hidden Value of LLC’s

Standard Lease Agreement

Most real estate investors will agree the use of LLCs (Limited Liability Companies) in the rental industry is a must for all investors, regardless of the number of properties owned. However, a major value is overlooked, especially for the passive investor, whom does not manage his/her own properties.

The main purpose or value of an LLC is exactly as the title says, to limit the liability of the LLC owner to only the assets held under the LLC. To minimize exposure, each property should be held in a separate LLC and controlled under one master LLC or series LLC.  When you set up an LLC, you will receive a federal tax ID for the master LLC, and you should open an checking account under the LLC for all properties (depending on where you live, this is most likely a state law).  Utilize a local law firm that practices real estate law to set up your LLC, the cost should be only 300 to 400 dollars.  Creating a relationship with a local lawyer is a good idea, as in the future they can assist in other frequently-encountered issues, such as evictions.

While filing for an LLC is relatively simple and could be done by most investors without outside legal guidance, filing individually should be avoided, as the overlooked value of the LLC is the anonymity that the LLC provides. The owner’s name of the LLC is concealed from public record, making it impossible for tenants or others to identify the LLC owner.  The only name that is public record is that of the individual that filed the LLC (e.g., your lawyer).  Don’t use your name or any other identifying attribute for your LLC name, as this may jeopardize the anonymity of the LLC.  This anonymity provides unlimited value for the passive investor, who utilizes property management companies to run their day-to-day operations.

Standard Lease Agreement

How To Buy HUD Owned Properties At The Lowest Price Possible

How To Buy HUD Owned Properties At The Lowest Price Possible

I recently submitted a contract on a HUD (Department of Housing and Urban Development) owned property. In the past, I have found success in HUD owner properties and believe they can be easily acquired below market value, which is both rewarding and a goal we all have.  HUD handles every property it acquires similarly, as it pertains to the handling and award of contracts.  Understanding how HUD operates will allow the buyer to acquire the property at HUD’s lowest acceptable price.  The following article is based on my understanding of HUD and consistencies I have observed when submitting and purchasing properties from HUD. It should be noted that this is, no way, a guarantee.

 

HUD properties are often listed for sale on the MLS (Multiple Listing Service) but all properties can be found at www.hudhomestore.com.  When HUD lists a property for sale, it will be listed as exclusive for either 5 or 15 days (depending on the insurance carried of the property).  Exclusive listing are only open to bidding from government entities, HUD-approved nonprofit organizations and owner-occupants.  After the exclusive period expires, the property will enter the extended bidding period.  This opens the bid to all bidders, including investors, and this is when the knowledgeable investor has the opportunity to acquire a property greatly below market value.

HUD has a preset acceptable offer price for all properties. HUD refers this to the minimum acceptable bid. The minimum acceptable bid is the net value HUD will receive after all commissions, technology fees, and any seller-paid costs.   The formula for this is not known and will vary based on area, market conditions and even on property backlog.  Contrary to popular belief, an all cash offer holds no more value than a financed offer.  If your offer does not meet the minimum acceptable bid, HUD will send you a letter or email that states the exact amount of HUDs minimum acceptable offer and the letter will state the bidding period has been extended for 24 hours.  As illustrated above, your initial offer should be only considered as a mechanism to find the minimum acceptable offer and should be well below market value.  If HUD accepts your offer, be aware you just over paid for the property.

Now that we know the lowest price, we can close on the property or as I would recommend, continue waiting. Offers to HUD can be submitted as both a primary offer and a backup offer, meaning HUD will hold your offer as a backup. It is important that you submit as a backup offer.  Like all motivated sellers, HUD will reduce their asking price as the property stays on the market for a certain duration.  Unlike finding the minimum acceptable bid, this duration is not known or easily speculated on. I purchased a HUD property where the price reduction happened 6 weeks and was followed up by another reduction a month later.  Currently, in my market, there is a property that has been on the market for 50 days, with no reduction, so the exact timing will vary greatly. The same day HUD reduces the price, they will review all backup offers and will send notice of acceptance to the highest-priced offer, above the revised minimum acceptable offer. Essentially, your backup offer allowed you first bid at a reduced priced HUD property.

Following this method for biding will provide you both the guarantee that you bought at the lowest price possible, and allow you the advantage of essentially receiving first right of refusal upon a price reduction.  Good luck finding your next tenant in a great new property.

Buildium.com

Buildium vs. Rentec Direct

Buildium vs. Rentec Direct

Buildium.com

Buildium vs. Rentec Direct

For the property manager or owner, Buildium and Rentec Direct are godsends, simplifying and streamlining your drudge work, providing total management, allowing you to focus on what really matters in the world of property management. But which is better for the needs of you and your business? Many investors and property managers aren’t sure which makes the most sense for them and make their decision purely based on Rentec Direct’s lower price point. Here’s how to sort out Buildium vs. Rentec Direct and make the right decision for your business.  Unlike other Buildium reviews, we performed a direct comparison of Buildium vs. Rentec Direct.

Buildium vs. Rentec Direct: What the Two Platforms Have in Common

One reason landlords can have a lot of trouble determining which platform to use is because of how much they have in common. For example, both platforms are web based and both offer phone support. Buildium additionally offers online support and a knowledge base, while Rentec Direct only offers video tutorials in addition to phone support. For the property manager who doesn’t have time to wait on the phone, this can be a significant difference.

Both offer tenant and lease tracking, work order tracking and payment tracking, as well as credit card processing. In fact, most of what you need done can be handled by both platforms. So where does the difference lie?

Buildium vs. Rentec Direct: Don’t Be Deceived by Price

When comparing the two, don’t be instantly pulled in by Rentec Direct’s lower price point. Many of the features that you will want, such as SMS messaging or ACH payments are going to close that gap real quick. Price shopping shouldn’t be your main consideration when it comes to finding the right property management solution. However, you should know that when it comes to comparing these two, the cost differences are negligible for anything but individual landlords seeking the most bare bones solution — and they probably won’t be using an app to manage their properties anyway.

Buildium vs. Rentec Direct: Features

Buildium is superior when it comes to marketing features, which is a must for larger firms managing scores or even hundreds (or thousands!) of properties. Buildium allows you to track your lead sources as well as marketing statistics, neither of which is offered by Rentec Direct. However, Rentec does offer one feature that Buildium doesn’t when it comes to marketing your properties: online vacancy postings.

Many of the accounting features overlap: Both accept online payments, integrate with your bank account, allow for uploading of bank statements, track invoices, offer online statements, allow for ACH, integrate post rent and late fees, print checks, generate profit and loss reports and run both your payables and receivables. Both are accessible from your laptop, desktop or iOS or Android-enabled mobile device. That’s important for the real estate professional on the go who has to manage all of his properties while he’s on the road.

Buildium vs. Rentec Direct: The Number Don’t Lie

Buildium is an older and more established platform than Rentec Direct. They’ve been around since 2004, compared to Rentec Direct’s 2010. This makes a huge difference in the amount of money that they process — Buildium has an estimated sales volume of $1.83 million versus a mere $168,000 and change with Rentec Direct. What this means is that the Buildium platform has already scaled in a way that Rentec Direct has not.

Buildium vs. Rentec Direct: Numbers Aren’t Everything

What’s more, when reading reviews of the two platforms, one feature of Buildium jumps out that’s hard to quantify: Most users just find it a heck of a lot more intuitive and easy to use. That’s something you can’t put a price on. If you plan on using a platform day in and day out, don’t you want it to be the easiest possible platform to use? This might be where the rubber hits the road for a lot of property managers and investors: Once you have all the features you need to run your business and your investments, why not just choose the platform which is easiest to use?

Fortunately, both platforms offer a free trial, allowing you to compare them, side by side, to see which works best for you and your business — and which is just the easier of the two to use.