Real Estate Accounting Winner: REIHub

[Jason Turgeon]

When I decided to find a new real estate accounting software platform in the fall and finally untangle myself from the nightmare of Quickbooks, I had no idea it would take me this long or be this complicated. You can read the whole saga and a roundup of the many different accounting and property management platforms I looked at over at my original post. But if you just want to know what I picked, and why I think it's the best available real estate accounting platform, this post is for you.

To recap, I have a handful of units. Some of them are in an LLC, managed by a property manager. Others are in my name, managed by me. I live in a duplex and rent out one unit. And I also have a business as a real estate agent, so I wanted to be able to track that business in the same accounting software.

Originally I was also hoping to find a package that would do more of the property management basics for me, like running ads, screening tenants, collecting rent, collecting e-signatures, etc.

What I found after months of looking is that there is no one-size-fits-all platform out there. There are some packages that offer great property management, but are really lacking in the accounting side. Then there are others that are great at accounting, but that's all they do. And some are reasonable at both of these things, but can't handle owner-occupied units, or multiple ownership structures, or lack the flexibility to track a real-estate related side hustle. If you don't need some of these more esoteric features, you might end up with something different than what I chose. 

But in the end, I went with REIHub (https://www.reihub.net/). REIHub, like Orville Redenbacher,  does one thing, and they do it better than anyone. And that one thing is real estate accounting. 

Here is a list of all the stuff I love about REIHUb, and why I'm paying them $25/month even when there are plenty of other options that are cheaper, offer more features (on paper), or both:

Their bank account import is flawless, with none of the sync issues I had with Quickbooks or Stessa. They had no problem with my random small town banks. Their auto-categorization is also rock-solid. 

Their built-in chart of accounts is fantastic. 

They handle things like getting a refund to your credit card at home depot with ease. 

They allow you to have multiple portfolios, so I can track my Detroit properties under management separately from my others. 

They have a beta import feature for appfolio, so if your property manager uses that you can upload the PDF statements. My old PM did use that, which was great. My new one doesn't use appfolio, but hopefully they expand this to cover other property mangement statements. 

They have userbase articles on how to set up owner-occupied (aka house-hack) properties. The overall userbase and FAQ is excellent. 

Their approach to sub-portfolios is intuitive and flexible, and it was easy for me to tweak a "portfolio" to have it track my income and expenses from my real estate agent gig. In fact, they advised me on how to do it!

They have excellent reporting features. 

They have a mortgage amortization feature that actually works so you can split your monthly PITI payment into interest, equity, and escrow payments and generate accurate P&L statements.

They offer depreciation schedules for fixed assets.

And the software has a great overall UI.

But even more important than all of that, they have the best customer service of any piece of software (real estate or not), I've ever used. During the trial period, I had several questions about how to set up properties, categorize transactions, etc. I figured I would try out the "help" button that appears on every transaction when you go to "book" it (e.g., categorize it after it's imported from a bank account feed). That opens a little form that you fill out with a spot for you to ask a question. On the REIHub side, they get a link to the exact transaction and can see exactly what you're asking about in the context of all your bookkeeping. 

I wasn't expecting much from this help button, but it turned out that within a few hours I had detailed responses with step by step instructions telling me exactly how to do what I needed. In some cases, these were pretty detailed and involved some significant bookkeeping fixes. Later, I emailed them asking if they could improve how they match credit card payments and not only did they agree that it was a good suggestion...they implemented it THE SAME DAY that I emailed. I'm honestly still blown away by that.

What this means is that I no longer worry that I'm doing my bookkeeping wrong. I know that they can help me get the entries in the right places, categorized the right way, so that my books will be accurate. It's honestly better than paying hundreds of dollars a month to a bookkeeper and wondering if they are doing it right, since only a handful of my transactions are every in doubt. And it's cut down my time spent bookkeeping by a huge amount, since I'm no longer searching Quickbooks forums via google for obscure workarounds specific to real estate. 

For the first time in the 15 years I've owned property, I don't loathe bookkeeping, and I'm not worried that I've got my books done wrong. That's a pretty huge deal. And for that reason, I wholeheartedly recommend REIHub.

Now, it's not perfect. For one thing, they don't offer any of the other property management stuff that many of their competitors do. And that's a bummer, since they cost as much as many of those other services. But given that they are so much better at real estate accounting than anyone else, I think it's OK. In my case, I don't have enough units to need all the bells and whistles of a more robust system. And if I did, I think I'd be happy to pay a few dollars a month to another service just to handle that side of things. 

They DO offer their accounting services as a value add to some of the property management software offerings out there, which is an interesting take. Unfortunately, these services mark up REIHub so much that it quickly becomes prohibitive to use them. It's better to pay two separate bills, even though it means having two separate accounts to manage. This is one area they could really improve on, but for now it's manageable. For instance, my 8 units plus real estate sales accounting (technically a 9th "unit") costs me $25/month through REIHub, but to get the same service resold to me by TurboTenant would cost $55/month. That's a pretty steep premium. If I ever want to use TurboTenant, it would be better to just keep the two services separate. I'd like to see that price delta drop, and if it does I might consider joining one of the other platforms.

REIHub's pricing also has a couple of flaws. I have 9 "units" now, so I'm at $25/month, and can have one more unit under this plan. But if I add one more duplex, that bumps me up to $45/month, which allows me to have 20 units. And after 20, it bumps up again to $80/month for unlimited units. Almost all their competitors simply charge a $1/month/ per unit fee as you grow your portfolio, and I think that approach, still capped at $80/month, would be much better than these big steps. It's worth noting that TurboTenant's resale pricing is $85/month for unlimited, so for only a $5 premium (vs the $30 I would pay now), it might be worth trying it out as an integrated package. 

Another area they could improve on is receipt capture. One thing QuickBooks did well was to snap a picture of a receipt, scan it with OCR, and then allow me to book the transaction later with most of the info automatically pulled out from the receipt. This is something that Landlord Studio does, too, and it's something I really miss. The process of receipt capturing in REIHub is fairly cumbersome. Take a photo, then manually enter all the data about your transaction right then. So if you're at Home Depot or the gas station, better be prepared to do some thumb typing while people wait in line behind you. As it is, I've gone back to just keeping paper receipts in a file folder and electronic receipts in a gmail folder. This is better in some ways, as I have the backups in the event of an audit and don't have to rely on my software vendor to still exist in 7 years. 

One final quibble is that they don't have the wonderful universal search feature of quickbooks, where I could just start typing and quickly find matching transactions. They do have filters, but it's clunky and time consuming compared to QBO's search. 

But in spite of the handful of drawbacks, the software is so good at its core functionality - bookkeeping and accounting for real estate - that there's simply no reason to use anything else.