@Jayden Hamilton Sit back and be thankful that you made your 3 properties come to fruition. Most people would kill for that. Step back and really think about how you can spend your time wisely. Use an excel sheet to allot your time for the entire week. That would at least let you know if your giving too much time to the things that aren’t useful. Think of it as a time budget. Cheers my friend.
@Terrell Garren good thought process
@Jayden Hamilton before you respond back to me let a day pass. This is a tool you need in your box. Use this for posting also. I don’t know you. Going totally off your posts and info you have provided.
Empathy I’ve never had a condition before. If my wording is wrong change it. Won’t go into the stress levels I have been though, the following is to focus on your success
Go to my Self storage checklist 101. Find an sfr or mfh calculator. Adapt to your needs. They will also guide and focus your approach. As you learn or get info add these to your checklist or calculator notes. Right now your “shotgunning” a ton of posts and questions. The checklists will help you take this info and keep it in an orderly fashion. Otherwise BP will overload you with info
Since your already into REI recommend you make a checklist by unit. Make your BRRRR list. Rank them. Prioritize them. Decide cost, do it yourself or hire out, timing. This puts "you" in control. Any time you get stressed go back to your list.
This should be a tool someone has shown you on your non REI life. Bring those type of tools over to REI
Each time you write a post add it to your checklist process whether you get a response or not.
Don’t trust me Take the above tools and concepts and discuss with someone that knows you and you trust .
@Jack Orthman wise words resonate…
Sorry, but never get involved in an investment where someone else controls your money and when you don't have 100% control. Talk about stress! Before you give some clown your money they answer their phone on the first half of a ring with a super friendly and exciting voice. After you give that clown your money that same person is far too busy to answer his phone and when he does he won't give you the time of day.
Eddie Torres Rental Property Investor
replied about 2 hours ago
Great post. I appreciate the feedback, Eddie. I agree. I believe it's a time management issue, and I have really bad ADHD, so I'm always thinking of something new to do. Consistency is tough for me, and it's hard for me to focus on one thing at a time. I get bored very easily. I will definitely study more on time management, thanks and I wish you the best with your real estate endeavors!
Ever since I was a kid, I was fascinated with money; I was diagnosed with Tourette syndrome at a young age. I truly believe My Tourettes contributes to this... How? Because people with Tourettes usually in adult hood deal with severe anxiety, depression, OCD, and ADHD. I can 100% say that OCD and ADHD have caused me to restrain myself from spending hardly anything and discipline myself not to spend much. Also, being in the military helped for four years. I lived in the dorms for 3 years, and the military covered utilities, food, and insurance. I made roughly 20k a year in gross income, and I saved about 15k each year for four years which added up. Plus, deployments and TDY allowed me to make more money due to being in hazardous areas. I didn't go out and party and drink like most of the other military guys; after work, I would sit in my room and study and learn about investing and just save as much money as I could. That's it really; I just had no life, isolated myself, saved every penny I could, and spent my time reading and listening to everything I could about Investing. I hope this helps. Feel free to DM me if you have any other questions; Edwin, thanks.
What app would you recommend Lindsey, thanks for your feedback.
Thanks for the kind words Eric, wish you the best in your real estate endeavors!
I agree. Everyone keeps advocating to get a property manager, but I have family members that had turned their homes over to a PMC, and the next year, the home looked worse than it did when they first handed it over. I'd rather deal with the stress and do it myself and learn as I go. I'm not paying a management company to "take care of my property" when they have 700 other homes they're "managing." I doubt my home will be their priority.
“Problems are good. Problems mean you have a tenant. You have to be bigger than your problems.” -T Harv Eker (Secrets of the Millionaire Mind)
Everyone has a different way of understanding what the word "Stress" really means. After reading the forum I've seen a lot of negative comments. Jaydan I know you suffer from OCD and ADHD since I read it in the replays and I know that I can't really grasp how you feel but I can tell you that you got this and you are doing amazing.
Not a lot of people can say they accomplished what you have with everything that you dealing with and went through.
You should put on paper everything that is causing you the most stress, starting from the biggest problems that you dealing with so you can visualize it instead of building it up in your head. After you did that see what you can get rid of, look for advice go to local RE meetups, talking to someone with experience that will help you understand the management side of investing.
I know you got this, always remember not everything is bad as it seems. You are crushing it man
I'll add another vote to the "hire a property manager" advise!
When we started out, doing everything on our own (and at the time even with only one property) we felt like we were burning out. Best decision we ever made was finding and hiring a qualified property manager to run the place!
In the beginning it really cut into our profits, but quality of life is EVERYTHING, especially if you have plans to grow or scale. Turns out, a few years in we were doing far better overall in profits as well, because our manager knew where to save us money, wasn't afraid to raise rents, etc. I look back now... there is simply no way we would have ever continued investing without finding some to hand the day to day management.
Look for an out of country assistant ? Four hour work week said something about that.
@Jayden Hamilton liked what Joe said and you could even consider commercial...industrial, businesses, etc.
Cozy.co is a good one. I use it now. I believe they were bought out by apartments.com. Not sure how that will change things. Another popular one is buildium which may have a small fee. Require your tenants to put in service requests and to pay through the app. Take yourself out of the equation.
I agree with Nicholas. Property management is an art and a science. 3 properties should be a breeze if you have systems, policies and experience.
In the short-term hire a property manager to give yourself a break. That gives you time to learn and grow into property management OR it gives you time to focus on the part of the business you actually like. It may seem like a waste of money, but it’s actually an investment that will pay for itself in the long run.
Originally posted by @Jack Orthman :
You have to tell yourself that owning rental properties is a business like a liquor store, gas station, or whatever and every business has inherent problems, but the beautiful thing about real estate is once you get organized the money constantly pours in while you are sleeping or even on another side of the planet and real estate takes the least amount of maintenance compared to other businesses. So, a tenant's disposer is leaking. Find an honest and reasonably-prices handyman and you don't have any reason to get a headache.
I made this promise to myself the day my 28-unit building closed escrow. I walked into the courtyard and told myself that I would never ever let this apartment building make me upset or emotional and I honored that promise regardless of whatever happened.
The day the apartment building closed escrow we gutted an apartment to the 2x4's. We brought in a bulldozer and Bobcat with a jackhammer and we removes the swimming pool, all the concrete in the courtyard to the street curb. We removed 8,000 sq ft of driveway. A tenant came out and spit in my face because of all the mess and noise. I smiled and asked him when he was going to move. He asked me if I wanted him to move and I said, "yes".
My wife and a worker could not believe how calm I was when this idiot spit in my face. I sort of laughed because I wanted to honor my promise. But...there is a super major reason I love the real estate business and never get upset. It is because I think much differently than most people. I constantly crunch the numbers almost monthly to see how much money I am making when including the amazing increase in the property's value each time I raise the rent and I do my math over and over so that I am excited and I can do the math in my head.
So, when the tenant spit in my face my mathematical mind went into overdrive and this irate tenants idiotic move that resulted in an eviction just earned me a big fat paycheck. Wahooo! I hope more tenants spit in my face.
How much did I earn when the tenant spit in my face. The building is in a very desirable area in Torrance California and has the best public schools and high-end shopping centers and malls. The building has a Gross Multiplier of 18. Here is how much money I earned.
I evicted the tenant, remodeled his apartment and increased the rent for that apartment by $300.
My immediate earnings. $300 x 12 = $3600 additional income per year. Increase in propety's value = $3600 x 18 = $64,800 + $3600 per year = $68,400 and then when you stretch out these numbers 5, 10, 20 and 30 years your profit is amazing as in the chart.
Get organized. Get your mindset straight. Do things that reduce your maintenance costs like remove garbage disposer and dishwashers from every rental property. We own many units and we removed the garbage disposers and dishwashers from almost every unit and not one tenant complained. There was a time we would get calls and have to replace 5 garbage disposers in one week. I hate disposers because they are like having a garbage can inside your home that results in odors, nats and you can't put everything in them, anyway. My wife and I remodeled our kitchen, installed a dishwasher and never use it one time in 18 years. It cost me $60,000 to remove the lawns at 4 apartment buildings and I thought about removing the lawns for 5 years. Now, I am ecstatic regarding how much money we save on water, gardening and time.
Owning rental properties is the greatest business there is. You make money when you are sleeping, you make money almost exponentially when you increase rents for rental units. But...you need to constantly do the math to see how much money you earn when you raise rents and increase the property's value and all the other profits you earn like from depreciation recorded on your annual tax records, etc.
The biggest mistake I ever made in my life was when I was 23-years old, already paid cash for 6 single-family homes, did not like owning real estate because I was too immature, did not know the math, sold the properties, invested $1 million into a limited partnership and lost exactly $1,050,000 after paying attorneys $50.000.
Get your math and mindset straight. I am a buy and hold forever person, but since I am not 71-years old I thought about selling my Las Vegas properties for 5 years, pulled the trigger on that and it was a nightmare evicting the tenant and cleaning every house. When I walked into some of the homes I literally got tears in my eyes when I saw the filth and damage, but, again, I immediately recover emotionally because I made more than $3.5 million from those 28 houses in less than 10 years. So, why would a person really dislike dealing with tenants and filth when making money every day sort of like behind the scenes.
You need a philosophy you understand and adhere to!
I love this post. Virtually everything in it is my philosophy as well. And @Joe Splitrock 's as well. Life is what you make of it. At 23 years old, with a paid off property, two others, 3 in total making cash flow and $100k in reserves in the bank, you are so far ahead of 95% of the population in the US - forget about the rest of the world, where it would be more like 99% - that you have virtually nothing to be stressed about. You're on your way to a gold mine of wealth, really. I would say keep doing what you are doing, but learn to not be afraid to pay (reasonable) costs to reduce some of the workload. It is a Jack said - you own a business, and like all businesses, you have to pay for some services. Yes, paying for those services will reduce some of your profit on the front-end, but probably give you more bandwidth to expand your profits on the back-end through recapturing some of your time and energy.
Of course, if you are going to blow all of your newfound free time on "hookers and blow", as my friend @Jim K. would say, then you're probably better off to just keep working hard like you are now ;)
i build myself up to 20 units and I agree with everyone about hiring a quality property manager. Right now I don't have that... and it took me a while to realize this issue. the problem for me has always been how to find a qualified property manager in my area.
@Jayden Hamilton don't let the tenant get to you because you are young. I was a little older than you are now when I got my first property. This is your property and your rules (obviously ones that are fair housing and local laws compliant). If they are disrespecting you and violating the terms of the lease, terminate it. The mortarium is ending soon in Illinois and they won't be able to hide behind it anymore. I've been there with the whole youth thing and the disrespect usually ends once they know you mean business and you will enforce your lease.
I agree with getting a property manager if you don't want to deal with the tenants and potentially selling if you need to find properties that will cash flow better . There's always going to be stress and tenants will always get to you at times, but try not to let it overwhelm you. Your way ahead of a lot of people your age.
Hey Jayden, are you opposed to hiring a PM? If I was you, I would worry less about saving costs and start outsourcing the things that stress you out.
Unless your just looking for empathy, lets move on to action. If you can't start to take action, your wasting your time. The following will help you compartmentalize and focus. Yes you will never get everything done, but you know your getting what needs to be done and if you need to outsource.
Open up a spreadsheet.
Lets look at SFH. Break it down in to components, again look at my Self Storage checklist. I'm not a SFH person. The above people can help you this way. Also go back to all of your BP posts and find a spot on this list for that item/question.
Category/item Status Priority Estimate ($) Action:
Landscaping Ok low $500 Wait till 2022
Sewer Unknown low $700 Have snaked and pumped (if septic) in 2023
Water lines OK n/a $0 No issues, good pressure, no excessive bill
sidewalks Needs work medium $500 Three lifts with roots underneath. Fix in November.
grading Needs work medium $300 Soil drains towards the south side of house. 2023
etc. and so on.
Come back to this group and share your checklist template. Ask them to help enhance it. Then go to your three buildings and fill it out. Bring back to this group and enhance it again. As you make a post on BP or learn things, keep adding to this list. This way your also getting input, but also adding value to the discussion. In the future, convert this checklist for when you evaluate a new purchase.
Make another list of Contacts. This is your team:
100% agree with this comment right here. I'm 26 and would love to be in that position right now but I need to keep working towards it. Very well said my friend 👏👍
Hire a property manager or sell the properties. Point blank period.
If you want to reduce the stress, sleep at night, and only wake up to great communication and deposits hire a property manager.
If you want 100% guarantee that nothing would go wrong – sell the properties. Real estate investments requires risk but you can manage the risk wit the proper systems in place. Property Management was designed to do just that – manage properties by having systems in place. You have to interview companies to see if their services suits your needs. If not, no worries and on to the next interview. You must ask the right questions in your interviews. With the correct team, right systems in place, proof in the pudding, and data to bag it up…… the company that have these qualifications would be more likely to ease your pain. Please do not hesitate to reach out if I can ever assist you.
Best of Luck!
A property manager is 10% of the rental income max and well worth it so you can reduce the stress.
Don’t make a rash and permanent decision on selling because you are stressed.
Once you have someone to deal with some of those issues you will be able to step back and make reasonable decisions.
Hiring a property manager is not something you will regret because it’s not permanent; you can always take back the Management yourself.