Tech can influence decisions for 73% of tenants: How property management software can benefit landlords

Advanced technology can influence decision-making for nearly three quarters of renters. Here’s how property managers can use software to meet demands and stay competitive.

The current rental market features high rents due to inflation, increasing interest rates pushing potential buyers to rent for longer, and the growing appeal of short-term rentals competing with long-term leases. Consequently, landlords are facing intensified competition. 

To stay competitive, landlords need to focus on enhancing tenant satisfaction by leveraging advanced customer experiences and effective technology. Capterra’s 2024 Tenant Experience survey reveals that nearly three-quarters of global tenants agree that the use of advanced technology like smart appliances and keyless entry can influence whether a tenant signs a rental agreement. 

However, acquiring new technologies isn’t enough. Landlords need to understand what factors are the most important for renters in order to deliver an optimal tenant experience. With this in mind, property managers should ensure they have the right property management tools to cater to these demands, help them carry out administrative tasks, and derive value from their technology investments. 

Capterra conducted a global survey in twelve countries, with a total sample of 4,800 tenants. Of this sample, 400 respondents were from the UK.* The survey results provide insights into current digital trends and preferences among rental property stakeholders. Moreover, this article explores actionable strategies property managers can take to leverage these insights to enhance operational efficiency, boost tenant satisfaction, and secure renter loyalty.

Nearly half of property managers fail to offer tenant-friendly technology 

With various digital tools available, both tenants and property managers can use technology to enhance convenience and improve efficiency and internal operations in property management. The use of digitised services is increasing, and many tenants report having access to digital tools in their current rental property.

Online payment portals and online document portals are the most adopted digital tools in rental properties among our surveyed tenants. However, nearly half of surveyed tenants globally do not have any of the mentioned digital tools in their rental property. This showcases that, on a global level, a significant number of property managers have yet to deploy digital features to facilitate tasks or improve their tenant experience. 

Meanwhile, the most desired technologies globally by tenants with no digital property management tools are remote security apps (35%), smart energy management (34%), and smart locks (34%).

Many of these technologies are more than simple additions to a tech stack. These tools can streamline administrative tasks and enhance security and convenience for both tenants and property managers. Given the influence advanced technology can have on tenant decision-making, landlords should employ these tools to stand out from the competition.

73% of UK tenants not using digital tools in their rental properties would like to do so

UK tenants are not leading the way in adopting property technology compared to other countries: 44% of UK property owners don’t offer renters convenient technology, compared to the global average of 48%. However, adoption rates for certain tools in the UK are noticeably higher than the global average. For example, over a third of UK tenants (34%) have access to online document portals. 

Despite this, UK tenant adoption rates for dedicated communication platforms (10%), online payment portals (19%), smart locks (7%), and remote security apps (7%) are below the global average.

This tendency is also reflected by the group of tenants who are not utilising digital tools but would like to. Out of the global respondents who currently do not have any of these technologies in their rental property, 66% of them express interest in having at least one of them. However, this number increases to 73% in the UK.

Technical glitches and limited customer support can undermine convenience and flexibility benefits

Satisfaction levels with digital tools in property management are high, with 83% of global tenants with digital tools available reporting they are either satisfied or very satisfied.

These technologies offer significant benefits, such as increased convenience, efficiency, security, flexibility, and better record-keeping. In the UK, however, security is not a major perceived benefit, with only 19% of tenants highlighting it, suggesting some scepticism about the security of these digital tools.

Tenants have technical and privacy concerns about property tech

Despite the benefits, some tenants using these technologies and digital tools continue to face challenges. The top challenges include technical issues (42%), privacy concerns (35%), and limited customer support (29%).

Addressing these challenges is crucial for maximising the effectiveness of digital tools and ensuring tenant trust and satisfaction.

Quicker communication can result in tangible benefits, including positive reviews

Understanding tenant communication preferences is crucial for fostering positive tenant relationships. Of the numerous features provided by digital tools, dedicated communication portals are not the most important for surveyed tenants globally. Instead, tenants primarily communicate via SMS text messaging or messaging apps (32%) and email (22%). 

UK tenants also have a high preference for these traditional methods. Email is by far the most preferred communication channel, with 45% of UK tenants using this method, while 35% prefer to communicate with landlords via SMS or messaging apps, 

Meanwhile, only 5% use dedicated online portals to communicate with their property managers. As most property managers are likely to have phones and email accounts, tenants may consider it unlikely that they will be more responsive via a portal than on their personal devices and email accounts. With average response times for messages and calls ranging from within minutes (24%), a few hours (34%), or a day (22%), it appears that this is a habit that is likely to persist. 

Nonetheless, efficient communication channels and prompt responses contribute significantly to tenant satisfaction and operational efficiency. Property managers should use communication platforms that match tenant preferences and establish procedures for timely responses to inquiries and maintenance requests.

Catering to tenant needs, providing the tools they need to manage documents, send payments, request assistance, or feel secure, and communicating using the channels they want to use can significantly affect tenant satisfaction and online reputation. A majority (82%) of surveyed tenants would write a positive review if they were to provide an online assessment of their current rental property. 

Maintaining these high satisfaction levels through the effective use of digital tools can further enhance online reviews and attract prospective tenants. With this in mind, property managers should actively solicit and manage online reviews, capitalising on positive feedback to enhance property reputation and attract new tenants.

Landlords should utilise property management software and incorporate the features that tenants most desire 

As rental property management evolves, adopting digital solutions can be essential for staying competitive and meeting tenant expectations. Implementing advanced technology like smart appliances and keyless entry can also influence whether a tenant signs a rental agreement. 

By using digital tools like property management software for tasks such as rent collection, expense tracking, and tenant engagement, and by providing smart security tools, property managers can strategically enhance tenant satisfaction, improve operational efficiency, and position their properties favourably.

However, to effectively meet tenant demands, property managers must ensure that they meet security and compliance standards and deliver convenient technologies that are easy and fast to use. 

In the second part of our study, we will explore the impact of short-term rentals on the housing market and how they affect living standards for tenants. We’ll also provide effective measures to address rent inflation whilst remaining competitive and explore the features that can justify an increase in rent payments according to tenants.