Investing in software for your business can be extremely rewarding. However, it can also be overwhelming to choose from so many options, each with their own strengths, weaknesses, features, and costs.
It’s no different with property management software. If you’re a landlord shopping for property management software, you may wonder why there are so many different pricing models and how they all differ.
While it may be confusing, the good news is a variety of models means a range of options and flexibility for different rental businesses. Here are the three most common pricing structures to help you find the best software for your personal or business preferences.
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Feature-Based Pricing
Feature-based pricing is the most common model by far for property management software. Software using this model charges for individual features, such as tenant screening, online rent collection, lease signing, listing syndication, and others.
The concept of feature-based pricing is simple, but this model is also commonly used by software companies that use multiple pricing models. This practice means that within the feature-based model, the type and frequency of fees can vary. For example, there might be a one-time fee for each feature you add, an annual fee, or monthly fees.
This pricing structure is ideal for landlords who are only interested in a few features of property management software and don’t want to pay for extra ones they aren’t going to use.
A few companies that use this pricing model include Appfolio, Buildium, Yardi Breeze, Tenant Cloud, and Avail.
Monthly Subscription
Monthly subscriptions are also a pricing model you’ll frequently find in the property management software niche. As its name indicates, this model requires a monthly fee to gain access to the platform.
Within the monthly structure, you might also encounter various plans. For instance, some plans may offer basic features while other, more expensive monthly plans will grant you access to additional secondary features like a mobile app, listing syndication, or multiple user capabilities.
Software with monthly subscriptions is a good fit for landlords who find software they like and want to have access to most or all features on the platform.
One company that uses monthly pricing is Buildium.
Freemium
Freemium is a third common pricing model for property management software. This pricing structure is widely used by many kinds of software companies.
There are two different ways freemium pricing models are typically structured. In feature-light versions, it’s free to make an account or use basic features like adding properties, but fees are required for full functionality. The second layout is a free trial, in which you get full access to the software and all its features for a limited number of days, after which full fees are required.
This model is great for landlords who feel most comfortable trying out software before committing to a paid subscription.
Two software companies that use this pricing model are TenantCloud and Avail.
Bonus Tip: Free Software
Maybe you’ve considered various pricing models and decided that property management software just isn’t worth the price. Are there any companies that offer property management software for free?
Yes, there are. Free property management software, while rare, does exist. These companies make a profit not off landlords, but off tenants—they extract small fees spread out across tenants when they make credit card transactions, purchase rental insurance on the platform, and take other actions.
One company that offers property management software for free to landlords is Innago.
Property Management Software: A Worthwhile Investment
Although each software company will design their own structure, these three pricing models are ones you’re bound to encounter while shopping for property management software. No one model is inherently better than another—each has benefits for landlords, and the price you pay buys you an invaluable asset for your business. By keeping your own preferences in mind when you search, you are sure to find property management software that works for your rental business.