{"id":120084,"date":"2019-12-13T12:00:28","date_gmt":"2019-12-13T19:00:28","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=120084"},"modified":"2024-01-27T08:35:05","modified_gmt":"2024-01-27T15:35:05","slug":"know-how-diy","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/know-how-diy","title":{"rendered":"Want to Grow Your RE Investing Business? Stop DIY-ing"},"content":{"rendered":"\n\n      <iframe loading=\"lazy\" frameborder=\"0\" height=\"200\" scrolling=\"no\" src=\"https:\/\/playlist.megaphone.fm?e=BIGPOC4795144744&#038;light=false\" width=\"100%\"><\/iframe>  \n\n\n\n<p><span style=\"font-weight: 400;\">I previously wrote a piece titled, &#8220;<\/span><a href=\"https:\/\/www.biggerpockets.com\/blog\/diy-is-dead\" target=\"_blank\" rel=\"noopener noreferrer\">4 Reasons DIY is Dead (An Argument for Outsourcing Everything<\/a>.&#8221; <span style=\"font-weight: 400;\">What amounted to a polarizing article was meant to explain why performing the labor in your real estate business is a terrible idea. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">I still love that article and agree with my original position, but I wanted to clarify and expand on it.&nbsp;<\/span><\/p>\n<p><strong>It\u2019s extremely valuable to <i>know how<\/i> to DIY\u2014but extremely low value to do.<\/strong><\/p>\n<h2>Avoid Costly Repairs<\/h2>\n<p><span style=\"font-weight: 400;\">If you\u2019ve never worked on a house before, how confident can you be when you walk into one without knowing the scope of work?&nbsp;<\/span><span style=\"font-weight: 400;\">I had a friend who asked me about a <a href=\"\/renewsblog\/2014\/01\/07\/flipping-houses\/\" target=\"_blank\">flip<\/a> he was doing that apparently had all the baseboard installed wrong so it needed to be replaced. He was incredibly anxious about this because he had no idea what baseboard was. To him, it <\/span><span style=\"font-weight: 400;\">sounded <\/span><span style=\"font-weight: 400;\">expensive, but he just didn\u2019t know better. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">For anyone else that doesn\u2019t know, baseboard is the small strip of floor trim that brings together the walls and the floor. It\u2019s super cheap and super easy to install or replace. If my friend didn\u2019t have me as a sounding board, then you can imagine how easily he could have gotten ripped off. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">This is the same old stereotype of the person who knows nothing about cars and gets told they need blinker fluid or muffler bearings. If you don\u2019t know better, you are at the mercy of blindly trusting your <a href=\"https:\/\/www.biggerpockets.com\/blog\/ultimate-guide-how-to-find-contractor\" target=\"_blank\">contractor<\/a>, which is not a situation I recommend putting yourself in.<\/span><\/p>\n<p><strong><em>Related: <\/em><\/strong><a href=\"https:\/\/www.biggerpockets.com\/blog\/most-common-rental-repairs\" target=\"_blank\"><em>The 10 Most Common Rental Repairs You\u2019ll Encounter<\/em><\/a><\/p>\n<p><span style=\"font-weight: 400;\">Understanding how a house is put together, what the materials look like at the hardware store, how difficult things are to complete, and how long they take are all things that allow you to make faster and better decisions when you\u2019re doing rehabs. They also reduce the burden of stress, which may be the costliest part of real estate of all.&nbsp;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For my friends who need to learn more about house construction\u2014but don\u2019t have a project yet\u2014 may be wondering, \u201cAlex, I want to learn how a house is built, but I don\u2019t have one to practice on and I can\u2019t quit my job and go into construction. What do you suggest?\u201d Well, I\u2019m glad you asked because I have the absolute perfect solution for this problem:<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Volunteer for Habitat for Humanity<\/span><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-107302\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/02\/construction.jpg\" alt=\"home-construction\" width=\"702\" height=\"336\" title=\"\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/02\/construction.jpg 702w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/02\/construction-300x144.jpg 300w\" sizes=\"auto, (max-width: 702px) 100vw, 702px\" \/><\/p>\n<p><b>First<\/b><span style=\"font-weight: 400;\">, even if you\u2019re a knucklehead who\u2019s never picked up a hammer, they will likely be very happy to have you.&nbsp;<\/span><\/p>\n<p><b>Second<\/b><span style=\"font-weight: 400;\">, you get to learn a<\/span> <span style=\"font-weight: 400;\">ton about building homes, what things cost, and you can do it around experienced builders who won\u2019t let you mess anything up too badly.&nbsp;<\/span><\/p>\n<p><b>Third<\/b><span style=\"font-weight: 400;\">, you get to meet a ton of people and build some potentially great long-term relationships. Many of the people who volunteer at Habitat are full-time builders that have contracting businesses.&nbsp;<\/span><\/p>\n<p><b>Fourth<\/b><span style=\"font-weight: 400;\">, there is no downside risk to this at all. There is nothing you can do that will cost you money. It\u2019s a <\/span><span style=\"font-weight: 400;\">purely <\/span><span style=\"font-weight: 400;\">upside endeavor\u2014and those are rare.&nbsp;<\/span><\/p>\n<p><b>Fifth<\/b><span style=\"font-weight: 400;\">, and most importantly, you get to give back to the community. Many people claim this as a motivating reason for their real estate business. Well, if you only do it for profit then it\u2019s not as generous as one might claim.&nbsp;<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Manage Your Rental&#8230;for a Bit&nbsp;<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">These days I use a property manager for my entire portfolio, but when I started I self-managed my rentals. For single-family rental owners, this is a good experience to have. Understanding tenant onboarding, listening to their feedback and complaints, and dealing with a multitude of differing personalities are all things that are going to benefit your business immensely over time. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Even when you turn things over to a property manager, you\u2019ll have a better relationship with them because you\u2019ll have a deep understanding of what they have to deal with and what you\u2019re asking of them. You\u2019ll also be able to hire better <a href=\"https:\/\/www.biggerpockets.com\/blog\/interview-property-managers-ultimate-guide\" target=\"_blank\">property managers<\/a> in the future because you\u2019ll know what it entails. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">One of the biggest problems new investors make is thinking they can buy <\/span><i><span style=\"font-weight: 400;\">any<\/span><\/i><span style=\"font-weight: 400;\"> property anywhere in the country and just stick a property manager on it and it\u2019ll run well. This, in my opinion, is peak arrogance. You should really know what you\u2019re asking from a property manager before you assume they will just do their job no matter what you throw at them. Property management is a difficult job, especially for C and D class properties. And having some experience in doing so will create a much different dynamic with your manager.<\/span><\/p>\n<p><em><strong>Related<\/strong><\/em>: <em><a href=\"https:\/\/www.biggerpockets.com\/blog\/property-management-vs-self-management\" target=\"_blank\">Professional Property Management vs. Self-Management: A Look at the Pros &amp; Cons<\/a><\/em><\/p>\n<h3>Then, Turn Over Management Responsibilities<\/h3>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-main-slider wp-image-116375\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/09\/confidence-702x336.jpg\" alt=\"confident-investor\" width=\"702\" height=\"336\" title=\"\"><\/p>\n<p><span style=\"font-weight: 400;\">When is the correct time to turn things over to a property manager? My suggestion is to do so sooner rather than later. I turned my portfolio over at only two units, with about two-and-a-half years of self managing. Your personal timeline will vary and I think it depends on how much you genuinely <\/span><i><span style=\"font-weight: 400;\">enjoy<\/span><\/i><span style=\"font-weight: 400;\"> having your hands in the business so closely. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Some people genuinely like fixing toilets and managing tenants. If this is you, then don&#8217;t feel compelled to outsource things so soon. Enjoying your business is priority No. 1 (in my opinion). If it adds stress to your life, have someone else do it. For most people I think they want real estate to create them freedom rather than just save a few bucks. Giving up 10 percent of gross profit for 90 percent stress reduction is maybe the best trade you can make in this business. Learning to manage the managers will provide the real freedom.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Scale Is the Solution to Every Problem<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">From an economics standpoint, I 100 percent stand by the point of the original article that DIY is the least efficient way to run your business. This is the whole premise of the book <a href=\"https:\/\/amzn.to\/2RONPbV\" target=\"_blank\" rel=\"noopener noreferrer\"><em>The E-Myth<\/em><\/a> by Michael Gerber.<\/span><\/p>\n<p><span style=\"font-weight: 400;\"> Working <\/span><i><span style=\"font-weight: 400;\">on<\/span><\/i><span style=\"font-weight: 400;\"> the business and <\/span><i><span style=\"font-weight: 400;\">in <\/span><\/i><span style=\"font-weight: 400;\">the business is a different skill set. One of those skill sets scales and one of them doesn\u2019t. The skills that scale are the ones you spend your time improving, and unscalable skills are the ones you outsource.&nbsp;<\/span><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-main-slider wp-image-114267\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/08\/5.2-702x125.jpg\" alt=\"ad-bookstore\" width=\"702\" height=\"125\" title=\"\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/08\/5.2-702x125.jpg 702w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/08\/5.2-300x53.jpg 300w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2019\/08\/5.2.jpg 706w\" sizes=\"auto, (max-width: 702px) 100vw, 702px\" \/><\/p>\n<p><em>Do you DIY or source out? What would you recommend DIY&#8217;ing and what would you leave to the professionals?<\/em><\/p>\n<p><strong>Share with a comment below!<\/strong><\/p>","protected":false},"excerpt":{"rendered":"<p>I previously wrote an article how real estate investors should outsource EVERYTHING when it comes to home repairs. Although I still stand by this, it is OK to DIY. But only if you educate yourself on how to do certain projects. <\/p>\n","protected":false},"author":14645,"featured_media":120485,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7392],"tags":[],"class_list":["post-120084","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-rehab-diy"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/120084","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/14645"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=120084"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/120084\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/120485"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=120084"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=120084"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=120084"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}