Landlords - What are all your practical Money savers?
Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
I thought it would be nice to have a collecting point for day to day money/time savers for rentals. Some things I do or have seen on the forum so far:
Remove storm doors.
Advertise rentals on craigslist
Remove or lock outside spigots.
Submeter or RUBS the utilities you pay yourself.
Put in low flow showerheads and put 2 liter soda bottle in toilet tank.
Convert laundry room to pay.
Convert all bulbs to fluorescent.
Replace grass with groundcover, gravel, flowers, etc.
Buy your own pressure washer - $85 at WalMart.
Buy post 1989 buildings (lead).
Advertise & Rent entire duplex to one family (I did this).
Have tenant rents ACH or have them deposit to your account.
PLEASE keep items to one sentence and list each separately!!!
A lot of good responses.
I would like to add a few:
When I buy a property and a bedroom door has a hole in it (probably from a fist), Instead of buying a new door, I buy a $6 mirror at HD and cover the hole with it. They make a special tall and narrow mirror (36 x 12 inches?) that is made for a door. Takes two minutes and only eight screws.
I use the same locks over and over and change them from house to house. I bought a key machine off CL for $50 and buy key blanks on the web for 17 cents each. I can make a key as fast as a high school dropout at the hardware store. I keep the original keys and give copies to the tenants. If they lose one, so what? Those locks are going on a different house and I still have the original. I then charge the tenant for the missing key from their security deposit.
I have all water bills mailed to me. I check and make sure the last bill was paid and then send it to the tenant for them to pay. It's in my lease that if they don't pay the water, I will pay it, add a $25 fee, and then give the tenant seven days to reimburse me. I let them know when they move in, if they only have enough money one month to pay the water or the cable - PAY THE WATER.
Unfinished basements require all plugs to be GFCI protected. If they are not protected, I put one in for laundry and remove the rest. They don't need to be hanging out down there anyway.
Garages usually have a bunch of scary looking electrical. Remove it.
Change all plumbing valves to quarter turn ball valves. It will save you money and grief in the long run.
When a property is vacant in the hood: Install motion sensor lights and leave them there. Lock the gate to the backyard. Leave a radio playing. Light on a timer. Install deadbolts that are keyed on both sides. If someone comes in through a window, they won't be leaving out the back door with all of your copper. You can change the locks out when a new tenant moves in.
I have my tennants mail me their rent. About the 20th every month I mail them a receipt from last month along with any instructions or issues. I then include a envelope with my address on it for them to mail me the rent for next month. All they need is the rent and a stamp. I make my late day the 3rd of the month. As long as it is postmarked by the third it is isn't late. Has worked great now for 6 months. I don't run around trying to pick up rent. The tennants like it because they have some leaway and I think they feel it is easier since I provide everything. It cost me a little in postage but not near as much on gas.
Installing a keybox so locked out tenants can let themselves in has saved several of my vacations. My tenants become absentminded when I go out of town. I change the code after each tenant use.
Landlordlocks.com
They sell Kwikset systems mastered so that you have one master key and simply change the cylinders, not the whole lock. So I now carry 1 key, and keep a spreadsheet of the cylinder #'s and what apartment they are on, then switch them when the tenants change.
Switching a cylinder takes about 10 seconds. You can also order them so that if a unit has two doors or two locks or whatever, all locks are on one key.
I also keep an extra latch on hand, since they do occasionally fail. I then get a service call, but it's only happened once in about 4 years.. Although I might get more now, since I switched all my units at the same time.
Also, here is a link to a previous thread about rekeying your own locks:
http://www.biggerpockets.com/forums/52/topics/52004-kwickset-smartkeys
Rather than property management companies, my modus operandus is to:
- have tenants mail or deposit rent to my account
- I use Craigslist to get tenant prospects
- I have a MagicJack that tenants/prospects can call with issues (I don't take calls, they go to email).
- I screen my own tenants, as this is by far the most important part and I don't trust anyone else to do it
- I plan to be at a property monthly to deal with maintenance
- use handyman for things I don't do myself.
And for properties somewhat far away, I find that making arrangements with a local church leader's spouse for some tasks is useful. They tend to be salt of the earth. They get paid per incident and they often appreciate making some $$$.
Looks like we need a BP post that lists good property managers in different states based on BP members USING them. Probably would help out a lot of out of state investors.
For me cutting down on water usage was huge, since Pasadena water rates are high. Low-flow shower heads ($12 each) and low-flow toilets (1.6 gpf, $108 each) saved me about $65 every 2 months (on 3 units, 6 toilets/6 shower heads).
All my units have the same color schemes, inside and out. I buy 5-gallon buckets at Home Depot during one of their holiday weekends (Labor Day, etc.) and keep them around. It's the multiple purchases of 1-gallon cans that slowly add up, on top of the cost of gas/traveling.
I also provide stamped envelopes for the rent checks. This gives the tenants no reason to be late on their rent (I also do the same for my note payors if they aren't on ACH).
This is a common theme among successful people. I've also heard it referred to your "core skill set".
Equally important though and often forgotten is that a dollar saved is worth far more than a dollar earned. The dollar earned will have taxes deducted later, but the dollar you save is worth a whole dollar.
I make sure everyone of my units has a deadbolt and a non-keyed door knob. Its impossible to lock yourself out of your own home with a deadbolt. You would have to lose the key after you have left the home. In that case they can call a locksmith if I'm unavailable.
Precisely what we once had a tenant do. She went on vacation and lost her keys.
At least she called the locksmith herself and paid him for getting her back in.
I have it in my lease that the tenants are responsible for locksmith services if they lock themselves out. Good idea about the lockbox, although I'm certain the tenants would also forget the combo....when I'm on vacation :)
This thread just reminded me of a building owner I met quite a few years ago. We were doing a lead-based paint survey of his apartment building. He drove a big old Cadillac and had turned the trunk into a workshop, with tools fastened in place all over the bottom of the trunk lid!
Originally posted by Ken Latchers
Buy post 1989 buildings (lead).
Stephen Masek responded:
Wrong! Lead-based paint is rare in buildings built 1960 to 1978, and some built in the 1950s have little or none.
Asbestos usage peaked in the middle 1960 to late 1970s, then fell to almost none by the end of teh 1980s.
Oh Stephen, we Baltimore, Marylanders are so jealous that you could ever fathom such a response!
Lead is a HUGE issue especially in the Baltimore city and it was recently passed that landlords are now unlimitedly liable for any lead paint claims in which they are literally GUILTY unless they can prove themselves innocent. Even thoroughly remediated homes and after paying hundreds in lead certs & inspections, a home can still get lead tracked in and test positive...even if it tests positive for a very low, basically harmless amount your property is tagged and they go after all your other properties. It's pretty vicious what's going on here.
So I agree with Ken, for Baltimore anyways...buy homes post 1978 (which is easier said than done). And buy them in an IRA if possible.
Charles Perkins if you save spending a dollar, you really save spending the after tax value of the dollar. If you had spent it, you would have gotten a tax deduction. Right?
For the most part a dollar earned is the same as a dollar saved. Ignores capitalization, people who are maxed out at 25k in losses and have to defer etc.
Talking about when the sink drips, water heater fails, plugs don't work, the list goes on and on.......
Instead of having a "handyman, plumber, electrician, etc" go to the property and bill for the labor side of the work instead these are things we take care of in house which cost our time and the money is never spent. So a dollar saved is just that and helps CoC returns.
If I did not want to do anything with the properties I would have never bought them in the first place. After hiring everything out there are better ways to get a return on the money, and that's the name of the game.
Thank you for tips. I know the best way to find a reliable handyman is through referrals from other (more experienced) investors in the market. But, I've heard that investors usually hate sharing their own handymen with others because they want their own handymen to be available to them whenever the needs come up.
Is that true? That is why I hesitate to ask my colleagues here on BP which handymen
they use.
I always did it myself until I hired a guy I sold a rental to. Just luck I guess.
He has since bought several properties from me & his wife is brutal when tenants try to screw them. She would make one hell of a property manager.
I am always trying to find him work & often just buy a place for him to work on. We picked up a $58,000 foreclosure for $17,000. (absentee landlord didn't fix his roof) so it was $7200 total rehab. He now owns it with me holding the financing. The appraisal came in at $45,000. We have had such a great relationship over the years & I was recently instrumental in him buying an 1830's 3600 sq ft mansion near the lake. I hold
the financing & to think when I met him he lived in a small 1000 sq ft cottage with 3 kids.
Handymen like him are a gold mine.
A lot of good responses.
I would like to add a few:
When I buy a property and a bedroom door has a hole in it (probably from a fist), Instead of buying a new door, I buy a $6 mirror at HD and cover the hole with it. They make a special tall and narrow mirror (36 x 12 inches?) that is made for a door. Takes two minutes and only eight screws.
I use the same locks over and over and change them from house to house. I bought a key machine off CL for $50 and buy key blanks on the web for 17 cents each. I can make a key as fast as a high school dropout at the hardware store. I keep the original keys and give copies to the tenants. If they lose one, so what? Those locks are going on a different house and I still have the original. I then charge the tenant for the missing key from their security deposit.
I have all water bills mailed to me. I check and make sure the last bill was paid and then send it to the tenant for them to pay. It's in my lease that if they don't pay the water, I will pay it, add a $25 fee, and then give the tenant seven days to reimburse me. I let them know when they move in, if they only have enough money one month to pay the water or the cable - PAY THE WATER.
Unfinished basements require all plugs to be GFCI protected. If they are not protected, I put one in for laundry and remove the rest. They don't need to be hanging out down there anyway.
Garages usually have a bunch of scary looking electrical. Remove it.
Change all plumbing valves to quarter turn ball valves. It will save you money and grief in the long run.
When a property is vacant in the hood: Install motion sensor lights and leave them there. Lock the gate to the backyard. Leave a radio playing. Light on a timer. Install deadbolts that are keyed on both sides. If someone comes in through a window, they won't be leaving out the back door with all of your copper. You can change the locks out when a new tenant moves in.
Hey just curious, what do you guys pay your Handyman?
I'm think $15 an hour in my area..
I'm think $15 an hour in my area..
$30 a hour & he pays his helper(s) from that, but I keep tabs of the time & project finances. For a project we need to finish quickly I throw in a good bonus to get it done on time.
He finished a job for me once that basically saved me $6,000 as it was necessary to get the property to code to close immediately or lose the deal.
However, I have used temps to do whole house carpet rip outs & wall/kitchen tear outs & the ever horrible basement clean outs. Its relatively cheap labor given the bull work required.
I pay my handyman $35 an hour, here in NJ prices are higher. He's worth it. He can do most electrical and some plumbing, and most everything else.
As for the vacant house in the 'hood, we just lost all our copper. Lights were on, gate to the alley access/backyard was locked. They jumped the fence of the house behind ours, came in a back window without breaking it. Double keyed deadbolts wouldn't have stopped them, they would have simply gone back out the window.
We have a tenant moving in in 2 weeks; until then, we installed an alarm system. $600 would probably have saved us $2k had we done it sooner.
I look at what is my biggest expenses and routinely spend time trying to figure out a way to save without sacrificing too much of my time or the tenants.
I self manage all my properties and place all tenants. Right there I saved a bundle. I create my own rent invoices with a tear off receipt that I stamp paid when they submit their rents and include it in the following month. I don't provide stamps but its been working well for a few years now. I would like to do online rent payments or through the banks but I don't want to pay the service fees.
I also do most routine maintenance myself but I am smart enough to know when I need to call a electrician, plumber, etc... I am also unique in that my dad was a contractor so I am very handy. Also having family in the trades helps.
My leases put the responsibility on the tenant for all appliances. So they pay repairs when they need them. I also bill them for repairs that are not wear and tear. The key is to be timely in submitting them. There are times that I forgive the bill but not before i hand it to them and make them aware of the cost.
Lately been dealing with a lot of drainage issues and now updating my leases to inform tenants if they are the cause of blockage expect a bill from me.
One of my pet peeves is the water bill. So for all my properties I removed all water spigots to the outside. I usually tell the tenants we had water leaks issues and have them removed. I tried the low volume water shower heads and most times I have to reinstall them when we get a new tenant.
Lastly I comb through Craigslist for most major appliances, equipment or material I can use on the properties. This proves as a huge money saver as I average paying about 25% from retail prices.
Buy it at habitat (doors, hardware, stray pieces of wood) or consignment store. (curtains furniture).
Buy Kitchen display units at cabinet shops.
Remember you aren't living there -Buy for price (another words if the tile is good enough don't let your specific taste make you spend another $ 1.00 /sq ft. If the $200 microwave is good enough don't spend extra to get a special feature you would like unless if will translate into more cash for you. I am not saying buy lousy stuff just to always ask yourself is the extra money I spend creating value or am I letting my taste drive the decision.
Exactly right @Colleen F., you put it perfectly. That was a lesson learned with our first 2 rentals. I would also add that the level of the unit/tenant also determines what we'll spend on certain things. We have tenants in high end condos and tenants in low/no income area SFRs. What we buy for the SFRs would never fly in the condos. A tenant paying $1300 a month would have an issue with a dent 'n bent stove from craigslist, but we only buy those kinds of appliances for the SFRs.
For locks, I buy the same cheapie sets at lowes and a general brand battery powered engraver.
I have a sequential four digit number scribed on the keys and locks.
After a tenant moves out, I replace the locks with the last set I removed from the previous move-out.
I make sure every lock at that property has the same key.
I have a spreadsheet accessible on my phone with the 4 digit number and the address (using just the street number, nut the name just in case it gets in the wrong hands)
for me its cheaper/easier than re-keying. It takes me under 15min to change all locks, since I leave the latches.
I also always have a set of toilet guts, bathroom faucet, and kitchen faucet (no sprayer) my truck. I buy the exact same guaranteed for life faucets every time. I replace them, and return the old one for a new one.
My time is super valuable, but I can replace a faucet or toilet guts in about the same time it takes me to call a guy to do it and write/mail a check.
I like a little face time with the tenants anyway.
If i need to buy parts or spend more than an hour on a repair I hire it out because a cheap but reliable contractor is alot cheaper than hiring me.