Good accounting software is a must-have for a serious and successful real estate investor. You can use any accounting software, but the ease and efficiency of using a platform designed with your industry and workflow in mind are much more beneficial.
How does real estate accounting differ from other types of business accounting?
As any businessman, real estate specialist primarily focuses on three things:
- evaluating expenses
- maximizing business revenue
- minimizing business debts
But besides, there are many equally important tasks in real estate accounting to which attention should be drawn:
- structure a business in the most tax-efficient way
- estimate the value of the real estate
- quickly show the best performing investment properties
- protect financial documents
- accept rental payments online
- accurate asset evaluation
- keep data safe and accessible in case of an audit
- track your portfolio’s performance
- have powerful reporting
- separate real estate business and personal expenses
There are not so many platforms that are intended primarily for real estate investors, but I’m sure that it is possible to find the one which will suit you perfectly. I’m here to help you with it, let’s get it started!
Choosing the best real estate accounting software
As we know, there is no absolute ideal for everybody. Every accounting software has its pros and cons. I’ve created a top-5 list of best accounting software for real estate investors. Each one is the best in their way.
1. QuickBooks: best overall accounting software
Pricing: QuickBooks Online Plus is $60/month; Advanced is $150/month; Pro is $299.95 (one-time purchase cost).
Choosing QuickBooks for accounting is always a good idea for any business, real estate not the exception. It perfectly syncs with your bank accounts, gives you the ability to classify income and expense accounts, creates professional-looking invoices, and keeps a photo record of every receipt for you to be always ready for tax time.
However, there are two cons for real estate investors:
- It’s not specifically designed for real estate investors, so you’ll need a little time to customize it.
- It’s not all-inclusive and lacks features that you will need. You will have to use separate software for, for example, receipt capture and upload.
Today it is one of the best and most efficient solutions in the market of accounting software.
2. Realtyzam: best income and expense tracking
Pricing: Realtyzam Accounting is $9.95/month (1 year contract) or $12/month (no contract). The Realtyzam CRM is $11.95/month (1 year contract) or $15/month (no contract).
If you’re looking for something simple to track your expenses and instantly generate the report you need for your taxes, then you’ll surely fall in love with Realtyzam. You can set up data feeds from over 15,000 banks and credit cards which Realtyzam will use to download all your new transactions and auto-categorize them based on your own custom rules.
But it also has its imperfections:
- It’s intended for use by real estate agents and brokers, not real estate investors.
Still, Realtyzam is very affordably priced and its simple features are useful for any real estate specialist.
3. Buildium: perfect solution for real estate investors
Pricing: Buildium is $47/month for 1 unit on the Core plan; $156/month for 1 unit on the Pro plan. Сost per unit drops with the more units you add.
Kudos to the accounting software that was created especially for real estate investors! Buildium can help you to track budgets, rent, vendor payments, and more with powerful reporting. You can make and accept payments online for rent, association fees, and vendors. One of the Buildium features is retail cash payments – you can easily make, receive, and process cash payments from residents. It also takes industry-leading security measures.
Buildium does everything a real estate investor could want, from tracking day-to-day tasks to some important accounting features.
4. Xero: best cost-effective cloud-based solution
Pricing: Xero is $20/month for the Starter plan; $30/month for the Standard plan; $40/month for the Premium plan.
You may have noticed Xero is less expensive than a comparable QuickBooks, but it is still a full-featured cloud-based software. You can run your business from anywhere and stay connected while you’re out and about. You can see how things are going with a glance at the up-to-date charts on the Xero dashboard and combine smart small business payroll software with your online accounting. It also allows you to sync Xero with third-party apps made for real estate specialists.
It is a cost-effective solution that has some really useful tools for real estate investors.
5. Wave: best free solution
If all you need is free basic accounting functions, Wave is the right choice. You can connect to bank and credit card accounts, print balance sheets and income statements, and balance your books.
Unfortunately, there are two cons:
- It doesn’t allow to separate profit and loss by property
- It accepts only one user
The answer is obvious – it’s basic and free.
As always, the final decision about the best accounting software for your real estate business rests with you and your accountant. Set your priorities wisely and identify your winner of today’s list.