What is the best accounting software for rental properties?
Accounting + Bookkeeping + AI The Trifecta for Smarter Financial Decision-Making
In the age of fast business, staying in control of your finances is not just about number-crunching. It’s about making savvy, strategic decisions that drive growth and that’s where the powerful pair of accounting, bookkeeping and AI in accounting and finance step in.
Owning rental properties is much more than simply collecting rent and managing the building. There is financial tracking, dealing with taxes, and planning for the property or business to be more profitable. Whether you are a small landlord or an employed property manager, the right accounting software is what distinguishes smooth property management vs overwhelming spreadsheets.
Why Accounting Software is Important for Rental Property Owners
In the world of real estate, financial accuracy is backbone to a successful operation. As a
landlord, the ability to accurately track:
- Multiple rental income sources for each tenant
- Mortgage payments and mortgage interest
- Property related maintenance and repairs
- Security deposit calculations and returns
- Property related tax deductions
It is easy to fall into a trap of trying to manage all of these transactions in a notebook or a spreadsheet. Many businesses fall victim to mistakes by tracking their rental property finances manually. Software focused on rental property accounting takes the burden of tracking receipts and expenses; gives real time reporting features, and prepares landlords for tax season.
1. QuickBooks Online
Who It’s Best For: Independent landlords and small property portfolios
QuickBooks Online is popular for many industries and is an excellent fit for landlords who want flexibility. It organizes rent income, can be connected to bank accounts, and generates cash flow and profit-and-loss statements by property. Because it is accounting software, many real estate professionals use it since it is recognized by accountants and many real-estate-centered property management tools also have connections to QuickBooks.
Pros:
- Easy to access from anywhere, cloud-based system
- Strong reporting functions
- Compatible with tax filing systems
Cons:
- Not designed exclusively for real estate situations
- Costly subscription pricing
QuickBooks is a reputable product for landlords that want reputable accounting without a full suite of property management software.
2. Stessa
Best for: Real estate investors looking for a totally free solution
Stessa was designed just for landlords and real estate investors. It automates income and expense tracking, sorts and organizes receipts, and compiles tax-ready financial reports. The simple dashboard gives property owners excellent visibility into performance.
Pros:
- Free for core features
- Real estate-focused reporting
- Easy to use
Cons:
- Advanced features might require users to figure out how to set it up manually
- Some limitations and reduced options compared to paid software
Overall, Stessa is a terrific starting place for landlords who want industry-specific tools without paying for extras.
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3. Buildium
Best for: Property managers managing many units
Buildium is more than accounting software–it is a full-fledged property management software that not only tracks income and expenses, but it has a built-in online rent collection, lease renewals, maintenance requests, and access to a tenant communication portal. The accounting module features bank reconciliation, automatic late fees, and financial reporting intended for property management.
Pros:
- End-to-end property management accounting and features
- Ability to manage property from a distance
- Secure portals for owners and tenants
Cons:
- Best functionally for larger portfolios
- Some owners may experience a learning curve
For landlords managing several units or agencies managing rentals for landlords, Buildium is the industry standard for a reason.
4. AppFolio
Best for: Professional landlords and large-scale portfolios
AppFolio is aimed at property management companies and landlords who manage larger portfolios. AppFolio is both an accounting and property management software tool. AppFolio provides several features that are integral to later stage property management, including features like online payment collection, expense tracking, reporting and even marketing for vacant units.
Pros:
- Designed for property managers and professionals
- Mobile-friendly, cloud-based
- Robust automation features
Cons:
- More expensive monthly fee
- Might be too robust for smaller landlords
AppFolio working best when the rental operations scale beyond a few units, thus it works well as a tool for the real estate business.
Choosing What's Best for You
The best accounting software is a function of portfolio size and personal need:
- Small landlords: QuickBooks Online or Stessa
- Portfolio managers: Buildium
- Larger rental operations: AppFolio
If you primarily want something free and tailored specifically for the real estate industry, Stessa is likely your best bet. But if you want an option that has accounting but also incorporates advanced property management features, either Builds or AppFolio will set you off in the right direction.
Conclusion
Precision and productivity within financial management is very important in the rental property industry. Accounting software assures landlords and property managers will maintain a precise accounting of their income and expenses while preparing for tax season, all while being able to maintain tenant relationships and expand their property portfolio.
The best accounting software is ultimately determined by the size of your rental portfolio, company goals, and budget. By investing in the right accounting software, you’ll be able to shift from reactive bookkeeping to proactive financial management – improving your rental property business for the long haul.
