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Investing in rental real estate is one of the best investments you can make with your money. However, it comes with some hurdles around managing properties and looking after the tenants. It can often get difficult dealing with the tenants – especially if it’s not your cup of tea. At the same time looking after all the other technicalities such as managing a property’s maintenance and making sure the occupancy rate stays high can get difficult if you have other things to look after.
This is where a property manager truly helps! You can look for a property manager to aid you with finding tenants, bookkeeping, maintenance work and almost every other thing related to your rental property. In-House vs. Third-Party ManagementJust like other things in life, each strategy has trade-offs. Managing properties yourself saves money you would have to spend paying a property manager. Most property management agencies bill 10 percent of the rent collected from the property. With that said, as any business book would tell you, time is money! Employing a property management firm saves you time, so you'll get a chance to focus on expanding your portfolio. Yet, the expenditures are more than just the money exchanged. Managing yourself reduces the risk of fraud and cheating as well.Managing the ManagerEven if you hire a property manager, you will have to manage the manager. You will have to request monthly income, vacancies, and receivables reports. If something isn’t going well, make sure to ask them about it. Be a little firm. The squeakiest wheel, after all, gets the grease. Which Should You Choose?It probably makes more sense to do it yourself if you only have one or two properties, particularly if you're house hacking. For a property management company, you will not be a high-value client. If you have reasonable amount of properties, for example, 5 or 10, then hiring a property manager will likely be more beneficial for you. Such a portfolio will take a large amount of time but will rarely produce ample profits for you to leave your job, so you need to prioritize whether you want to keep up with your job, the investment business, or juggle both. If you go really big (50+) then starting your own management company is, in my opinion, the best option. Previous Episodes - How to Manage Collections and Delinquency - A Guide to Due Diligence for Buying Houses - How to Find Banks for Your Investment Properties - A Crash Course on Building a Buy and Hold Real Estate Business - Is the Economy on the Edge of a Cliff??? How Should Real Estate Investors Respond? - An Introduction Into Buying Portfolios -Why Buy and Hold is So Powerful - Doing Maintenance Right - Moving to California? -How to Scale a Real Estate Investment and Management Company | Interview with Douglas Skipworth And don't forget to subscribe to our Youtube channel!
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I'm not a big fan of taxes, but after the latest (now vetoed) stimulus bill that would borrow/print another $900 billion and give Americans a whopping $600 one-time "stimulus," it would seem that a one-time Covid tax is called for. Many Americans are struggling and something like 400,000 small businesses have closed with many more at risk of failing. At the same time, the national debt is 20 trillion and our deficit this year will be more than twice what we bring in. Yet, many giant firms have had record years with Amazon, Facebook, Microsoft, Apple and Netflix are all up 20 to 60% YTD.  I think the lockdowns were overkill, but whatever you think about them, it's undeniable that the government enacted them and the winners were big business (and the government itself of course) and the losers were basically everyone else. A one-time Covid tax on those winners with subsidies to struggling small businesses and working class and middle class Americans on the edge as well as, I don't know, maybe a little bit for the deficit would seem be in order. Yes I know the rich pay the large majority of income taxes (the top 1 percent pays 39 percent). Although they pay much less so with sales taxes, payroll taxes and property taxes. But what I posted was about corporations and what would amount to a corporate tax. For example, Amazon's market cap went from $890 billion to $1.6 trillion this year. The large majority of that almost doubling was because of the lockdowns.  See the lockdowns as a form of indirect but massive corporate welfare. I recommend clawing some of that back.
Given the United States has such an enormous amount of money just sitting around in the Treasury, there's no harm in "making it rain" on the American people. (Please go ahead and ignore the following chart.)
Members of Congress had about nine hours to review the 5,593-page bill that allocated $2.3 billion spending bill. But that's fine. It's only 10.4 pages per minute? What have you never heard of speed reading?
The bill contains all sorts or provisions. Some good (money for small businesses that were hurt by the lockdowns), some bad (corporate welfare, pet projects) and some absurd. The most absurd being the foreign aid. I will remind you, this is a stimulus bill for Americans.
Overall the bill has $4.7 billion in foreign aid which is all a joke. But some of it is even more of a joke. Most notably the $10 million in foreign aid to Pakistan for "gender programs."
But don't worry folks, Americans get $600 (in highly depreciated dollars that have just been printed). That will go a long way I'm sure...
So Congress finally got around to passing another stimulus bill, this time for $900 billion. And since we can just print infinite money with no consequences, that's a great thing. Oh boy! Let's take a peak at the IRS website and see what I got...  Ohhhh......
Picking up off from my previous article on emergency maintenance in general, my latest piece for BiggerPockets discussed the specific problem of emergency maintenance over the Holidays. In other words, the fear of every real estate investor and landlord [emergency maintenance] compounded to its highest and purest form.)
But just like with "regular" emergency maintenance, most of what trips up investors is just in our heads. The key is to have a plan and execute it on the very rare occasions emergency maintenance on the Holidays is necessary, Emergency maintenance does not happen often. For each unit, it will happen, on average, less than once a year. Just make a plan and follow through on that plan.
Check out the full article here.
Also, it features our video on emergency maintenance which you should watch as well:
A potential tenant might be super excited for a house or condo before signing the lease. They may move in as cheerful as a child on a summer afternoon. Yet, sooner or later, that sheen will wear off.
Not long after moving in, their sole experience with their property manager or owner, apart from rudimentary upgrades, will be the monthly rent collection. This, obviously, isn't the most ideal approach to win somebody's heart. The only other major interaction you can have with an occupant is maintenance and it is here where you can have a significant effect.
The greatest cost that you can control as a landowner or property manager is decreasing your turnover. Less turnover implies fewer vacant properties and fewer turnover costs.
Things being what they are, how might you achieve this? Great customer service. And the absolute best customer service you can offer an occupant is quality maintenance. Consider your occupants your customers, and your maintenance as customer service! There are various approaches to complete maintenance. What direction is the best depends significantly upon your circumstance and goals. Generally speaking, the best approaches for different circumstances are as follows: 1. Do It Without Anyone's Help In the event that you have only a couple of rentals and are overseeing yourself, this is certainly not a bad approach. That being stated, you must be mechanically adept and have the time to do the work. Time is money after all. 2. Hire Contractors You can also hire professionals to do your work for you, although this approach might be a bit tricky, as contractors might not be keen to work on such small projects. 3. Maintenance Companies There are also companies that handle all the day-to-day maintenance jobs, as well as emergency maintenance. This option is a bit expensive, but is certainly something to consider. And of course, you can hire a property management company to oversee your portfolio’s maintenance or, if you grow enough, hire your own employees. Previous Episodes -How to Positively Resolve Tenant Disputes (Property Management) -How to Manage Collections and Delinquency - A Guide to Due Diligence for Buying Houses - How to Find Banks for Your Investment Properties - A Crash Course on Building a Buy and Hold Real Estate Business - Is the Economy on the Edge of a Cliff??? How Should Real Estate Investors Respond? - An Introduction Into Buying Portfolios -Why Buy and Hold is So Powerful - In-House or Outhouse Management - Moving to California? And don't forget to subscribe to our Youtube channel! In continuing my series (???) on terrible home remodeling decisions, I present you with this gem I came across on the BRRRR Invest Facebook group:  As incredibly stupid as that looks, it would have taken a lot of time and energy to put together. And it was done well for it's worth. So much time and craftsmanship for such madness. While Donald Trump is still in office, I should probably end this with a SAD! ...But it kind of reminds of this house we bought from a bank after they foreclosed on the guy who I presume was a meth head. I mean, this is a lot of work. And yes, those are all those little wood pieces you find in wood pallets and what not:  And no, that's not the standard way to do drywall. Nor is this the standard way to make a shed:  With all the partisan bitterness interspersed around this never-ending pandemic and its concurrent economy-destroying lockdowns, we've been at a loss for good news for quite some time. While this study is only regarding mice, it may be that we end this godawful year with some unequivocally good news. From the University of California San Francisco, Just a few doses of an experimental drug can reverse age-related declines in memory and mental flexibility in mice, according to a new study by UC San Francisco scientists. The drug, called ISRIB, has already been shown in laboratory studies to restore memory function months after traumatic brain injury (TBI), reverse cognitive impairments in Down Syndrome, prevent noise-related hearing loss, fight certain types of prostate cancer, and even enhance cognition in healthy animals. Of course that's a long way from being a cure for humans, but it's quite encouraging.
I would definitely be a huge game changer if brain injuries and age-related cognitive declines could be reversed or even stopped entirely. Hopefully something big will come of this research. We shall see. Spoilers: It's sleep. Sleep more and sleep better. That's the topic of my new article for BiggerPockets, which admittedly, doesn't have a lot to do with real estate investing. But regardless, better sleep will improve every part of your life, and if part of your life is investing in real estate, than that part will be improved too. The article reviews the great book Why We Sleep by Matthew Walker. Page one basically explains why this is so important, “Two-thirds of adults throughout all developed nations fail to obtain the recommended eight hours of nightly sleep. So make sleep a priority folks! (But while awake, check out my article. Thanks.)
So I had this absurd conversation on Facebook with this Leftist who is always in muh mentions. This guy has said the statue of Thomas Jefferson should come down and defended the softcore pedophile porn movie Cuties, but somehow thinks it's just everyone else who's being unreasonable. My first post was just mocking the failed experiment of CHAZ and the new one in Portland some nutjob leftists are setting up.
Mainly I was just noting it was nice moderate liberals could finally act that way now that they didn't have to countersignal Trump as Ted Wheeler promised not to tolerate "RHAZ." (Although Wheeler isn't that moderate, but he did beat a communist, so there's that.)
First I got a response from a hardcore, but still reasonable liberal, Id like to think moderate republicans could act as such too, but at least in my social circle, they all changed their party affiliations because of Trump.
The fanatical liberal then chimed in "There are no moderate Republicans." This seemed so obviously false I (unwisely) chose to chime in,
As far as politics goes, both sides are moving further apart, which is a bad sign. but it would seem the left has moved a bit further away from the center than the right. The chart below is from Pew. 
Thankfully, the fanatical liberal was there to enlighten me.
cool graph.
Why do I feel the need to argue with such idiocy? I don't know, but I do I guess. My response,
Woah bud, thanks for explaining reality to me.
It takes a rather enfeebled mind to believe that someone pointing out trends thereby approves of them, or in this case opposes them. I oppose some of this (like "transitioning" seven year olds) and support some (like legalizing marijuana). But any challenge (even observational) of leftwing hegemony is heresy. His unhinged, semi-coherent response:
Holy shiz, I have to stop you right from the jump!
This guy later accused a conservative who jumped in of lacking empathy because he made fun of equating cutting a kid's penis off with "human rights.
A friend pointed out to me during this that there is absolutely no point to argue with such idiots. It's just a mental suck. And it is. It's infuriating. "Why is gay marriage a liberal issue?" Uhhh, because it has been you fucking idiot. Why is "preserving our God-given right to bear arms" a conservative one. Because it has been. You just have to let it go. Indeed, I've gone round and round with him on Hillary Clinton's emails (he's always the one who brings them up) and he always talks about Colin Powell. I've repeatedly shown that excuse fails, but he just ignores it and brings it up again. He did the same thing here with the crack/cocaine difference in sentencing. Black leaders supported that discrepancy as did white leaders as the book I referenced showed. But just ignore evidence and ragepost appears to be the far left modus operandi these days. My glib response. Good God David this is such shill partisan hackery it's embarrassing. I think I'm gonna go ahead and disengage before wasting anymore going around in circles on this.
Then came the kicker:
Sorry to tell you, but the things you're claiming are "liberal" ideas are quite often just human rights. 
While this conversation wasn't enlightening at all because of the incoherence of my debating "partner," this line was worth it.
It's an admission that I was right. We are moving to the Left culturally. But because the Left is good (and just wants "human rights") while the Right is bad (and just wants people to die in the streets or something) then we can just take for granted that any Leftwing victory is pure good with no possible objection and any Rightwing victory (real or imagined) is 1930s Germany all over again. Unhinged stupid bullshit, yes. But that seems to be the growing consensus of how to think on the Left. I wisely turned to simply mocking him with a well-timed laughing emoji and turning his script around: Sorry to tell you, but conservative ideas are quite often just muh freedom and loving 'Merica.
Needless to say, the partisan disconnect in the United States is getting worse and dialogue is becoming more and more difficult. It's basically impossible with the likes of these people.
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