Flip Tip Summary
Buy and hold real estate investors often cheap out on the most important part of the business – property management. It’s often an effort to save money, or so they think, without considering all of the real costs. This generally goes hand in hand with lack of systems, processes, knowing current laws and tenant rights, and opening up far more exposure than the investor ever thought. Steve Rozenberg joins us on this FlipNerd.com Expert Tip to share more about how to treat property managment like a buisness.
Flip Tip Transcript:
Mike: Hey, it’s Mike Hambright from FlipNerd.com and we have a quick Expert Tip to share with you from Steve Rosenberg, who’s going to share some advice on how to treat your property management business like a business and not a hobby.
This Expert Tip is sponsored by RealtyMogul.com, B2R Finance and National Real Estate Insurance Group.
Steve: Yeah, so my expert advice would be to, make sure that if you do own a property or you’re looking to buy a property, remember you have a business. The landlord’s the highest suit in real estate and not because they intentionally do things wrong, but mostly because they don’t educate themselves. So, remember, you own a business. Whether it’s one property or 50 properties, you have a business. You have profit, you have loss, you have expenses, you have government entities watching you. You have the IRS, you have fair housing, discrimination, you have a lot of things and you want to make sure that you’re doing things correctly. And you don’t want to be one of those people that learns on the back side of the curve where you’re standing in front of the judge.
So take the time, write down some policies, write down some procedures, and most importantly, stick to those policies and procedures. And you want to make sure that there’s something that you will follow. Don’t make them pie in the sky. There’s plenty of places out there that you can get information to make them realistic. But just make sure that whatever you do, they are realistic and there’s something that you will not only stick to but you will enforce and you will expect the tenants or vendors or anyone you do business with, to follow. And the more professional you are and the more professional that you appear to be when you are talking to, whether it’s a resident, whether it’s a home seller, whether it’s a vendor, you will get that same respect back many fold over.
And you always want to think that you own a business, you are a business person, you’re not a landlord and that’s a big paradigm shift. A lot of people think landlord is, that’s someone who actually goes to Home Depot, and is doing all the work themselves. Not that there is anything wrong with that, but is that the best use of your time? And when you are a business owner and you own a business that owns rental properties, you leverage other people and other systems, and you’re able to utilize those to the best of your advantage. So, if I could give you any information, I would say that would be the best.
Mike: We’d like to thank Crestar Funding, MidAtlantic IRA, and Renters Warehouse.
Please note, the views and opinions expressed by the individuals in this program do not necessarily reflect those of FlipNerd.com or any of its partners, advertisers, or affiliates. Please consult professionals before making any investment or tax decisions, as real estate investing can be risky.