Whether you are a real estate investor, broker or agent, if you have reached the point where you want to get serious about real estate investing and have finally decided to purchase a real estate investment software solution to manage cash flow analysis for you , then this article is for you.
Hopefully I can tell you what to expect, what to avoid, and what to look for when browsing the various real estate investment software solutions offered online. I know that in my thirty years as a real estate professional I have been in your predicament many times.
In the beginning, of course, “ordinary” agents like myself who wanted to sell rental properties had to rely on cash flow analysis presentations created by rental property professionals; those guys who understood the calculations and had the investment software to present these dynamic reports. But I have to admit it was like jumping into a “secret world” restricted to only the few who had this knowledge and of course completely out of reach for the rest of us like you and me.
Then came computers and MS Excel, and almost overnight the “secrets” once held by the chosen ones became open to people like me. Almost instantly, all the calculations, rates of return, and rental property profitability figures provided by the apartment building gods could be accurately mimicked in cash flow analysis reports as eloquent as theirs. It was a magical moment.
As a result, with computer in hand, I purchased not one, but two real estate investment software solutions available online (and paid big bucks, by the way).
The first solution was developed by a CCIM broker in the form of a spreadsheet that calculated cash flows and rates of return and generated several reports. The problem for me was that the investment software did not have an easy to use interface and produced poor quality reports. In fact, I found the app overall to be too bland and uninspired for my taste, so I bought a second solution.
It was a standalone software, much better than the first one in that it provided a decent user interface with lots of calculations and much better quality reports. However, in this case I found the software too “heavy” for practical use. That is, in addition to the high cost (about $500), it was overloaded with things I didn’t need, making the software difficult to use and navigate; not far from an easy-to-use cash flow analysis program that I felt comfortable with, perhaps on a day-to-day basis.
I then developed my own real estate investment software to get the results I wanted and haven’t looked back since. However, along the way I learned something about investment software that I would like to share with you; has five top suggestions to make the right choice.
- Define your goal – What do you want the software to do? If you only plan to work with investment property casually, then you may not need a program that includes tax shelter calculations (so why pay for it); Likewise, if you plan to dabble more than casually in income properties, definitely consider a program that calculates taxes as part of a cash flow analysis (expect to pay a bit more).
Determine your purpose – Do you only want to do a cash flow analysis (ie make an investment decision) or do you also plan to sell the property? Look for real estate investment software solutions that offer choice.
Easy User Interface – You don’t want to struggle with real estate investment software. Look for solutions that provide user-friendly forms and toolbars. Here’s a tip: study the website. Is it well organized, creative, informative, unobtrusive and easy to navigate? Remember that the same company that offers the program also publishes the website.
Style – It’s not fun to use investment software without the sparkle (as I’ve found). Check out the screenshots and reports to make sure you’re happy with the style, professionalism and quality. Again, take a look at the website for more tips and insight into what you can expect.
5. Cost – Real estate investment software can range from $100 to $500 depending on its features. But cheaper isn’t necessarily better, and overpriced isn’t necessarily best (as I discovered). So look for investment software priced within this range.