Property Management Software is Dead: Welcome to REM

Property Management Software is Dead: Welcome to REM

[Editor’s Note: Below is the full text of our 226th Weekly Transmission, originally delivered direct to the inbox of more than 600 GEM members on September 8th, 2022.]

In spite of new software innovations, the property management industry continues to focus on the number of units under management because it’s beholden to the property management overlords who made it so. Property management software companies have historically operated in a silo, with few partnerships, zero flexibility, and poor integrations. The result was increasing per unit costs, frustrated and confused property management companies, and a lack of access to the services required to help property managers win consumers and add revenues.

Property management software is no longer the be-all and end-all, or rather, the gate-keeper of the rental management market. The rapidly evolving world of software ecosystems requires a more open and holistic view. A more unified strategy—with tools, partnerships, and services—could change the industry paradigm altogether.

There are early signs of the big, multinational, acquisition-heavy enterprise property management software such as RealPage and Yardi leaning in toward a more complete offering. Recognizing that their focus around property management specific tools isn’t enough to keep up with growing market demands, they have tried their hand at acquiring consumer and service related solutions (e.g. RealPage’s acquisition of Modern Message). The problem has been their ability to integrate these new solutions to cost effectively and seamlessly distribute them to existing customers.

Alfred has a forward thinking solution within the space, offering a more complete set of services, but primarily acts as an internal offering to their own managed portfolios. Meanwhile, resident experience apps such as Sugar and Pinata remain dependent on the relatively commoditized, accounting-specific management software that lead to the very problems of expense and misalignment the industry faces today. While in the right frame of mind, their dependencies will forever be the hill they have to climb.

Does simply adding features on top of a potentially flawed business model create an inevitable plateau on innovation? When engaging with fee-based management companies, does imposing unit based pricing perpetuate further misalignment? This competitive landscape has already provided a dangerous outcome of higher per unit fees. It has allowed a continued state of “walled garden” due to the systems we use rather than offering an ecosystem of connections, access, and opportunities these systems should enable.

Software built solely to support property operations is now over-built and far more expensive than necessary. Companies like ZumperSentral, and Adam Neumann’s Flow are driving toward a more flexible, service-oriented narrative because it’s clear that our industry demands a better solution. They are among those, rightly, stepping beyond the traditional definition of property management software

The days of Rental Ecosystem Management Software, or REM, are here. And, LEASERA will help property managers thrive in the new world order.

INTENTIONALITY FOR A BETTER FUTURE
LEASERA is adding value across long-term rental portfolios for property management companies and investment groups with consumer loyalty, an intelligent leasing-as-a-service platform with an integrated marketplace of supportive tools, and direct-to-door service providers (such as dog walking, food delivery and ride share). Consumers gain rewards, empowerment and flexibility.

An ecosystem solution allows for saving on sourcing and integration costs while offering more convenient access for renters with lifestyle-as-a-service. For example, partnering with a furniture rental company to provide more affordable furniture packages for newly moved-in renters by removing the “ecosystem access” tax. Loyalty programs support engagement of community-activated house cleaners and service pros, while providing additional income for community members to further instill loyalty to their place of residence. A better understanding of applicants allows leasing agents to deliver a more personalized approach. Remaining flexible to changing market demands has allowed us to extend appreciation, roughly $2,600 per year and growing (via internal LEASERA findings), to renters who prefer to get something for their investment.

The days of fostering loyalty through nothing more than simple gift cards are over.

By thinking differently, we are helping our customers uncover new sources of revenue and time savings, while minting happier, more fulfilled renters with affordable, high-quality services—all at a far lesser cost than the historic (and highly misaligned) per unit fees. By not haphazardly bolting pieces of software together as was once the norm, and being more intentional about how software builds towards the future from day one, LEASERA is able to deliver an entirely different cost structure.

This is a massive paradigm shift.

Not unlike updating Apple software, the future is one where property innovation occurs with the click of a button and without an increase in per unit fees. That will enable property managers to have a complete view of their business, and provide renters with a seamless, constantly improving experience. As a result, the isolation created by property management software is no longer an expectation—property managers will now be part of a larger ecosystem that also benefits service professionals and renters.

A NEW LIFE ON LEASING
In today’s ever-changing world, it’s important to stay ahead of the curve and adapt to new market demands. By understanding the role of property managers in the larger ecosystem and by being aware of new consumer demands, emerging property management software companies are better positioned to take advantage of new opportunities not possible before.

It’s always been the role of property managers to create stronger partnerships and provide great service to renters. Now it’s also affordable and efficient.

It’s time property managers take control of the vast new opportunities within the rental market and to stop letting property management software dictate what’s possible.

This is a new era of opportunity without being managed by property management software. This is REM.

[Photo by garrett parker on Unsplash]


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