Hidden Costs of Bad Software: How to Protect Your Property Business

Property Management

When news broke that a heavyweight property management software was hit with a lawsuit for price-fixing the rental market, it sent shockwaves through the industry. Similar lawsuits against other brands followed. A prominent rental software company faced allegations of enabling landlords to inflate rent prices artificially. It's the kind of story that makes tenants see red and leaves property managers wondering if they've unwittingly stepped into a minefield.

At first glance, selecting business software might not seem like a game-changer. However, the right choice can be crucial. Not only does it impact efficiency and cost, but it can also have significant legal implications. The wrong software could lead to unintended consequences, such as involvement in lawsuits. So, what's the best approach for property managers? Stay calm and focused. We'll explore how to avoid the pitfalls of poorly chosen software and safeguard your business.

The Consequences that Property Managers Face

The implications of these lawsuits are far-reaching and serve as a warning to the entire industry. Both the software provider and property managers who relied on it now face any of the following:

Legal Ramifications

Investigations could be launched by state and federal authorities, scrutinizing whether these managers knowingly participated in the price-fixing deceptions. Class-action lawsuits from tenants are also a real possibility, alleging unfair rent increases and seeking compensation for overpayment. Property managers might also face individual lawsuits from tenants claiming discriminatory pricing practices. The legal defense costs alone could strain or even cripple their ability to operate as property managers, not to mention the potential settlements or judgments. These are not the only fines they may be facing.