Tenant Management Systems Done Right
Trainer: Ross Lightle
When we think of management, we think of a supervisor holding a cup of coffee walking through an office making sure no one is surfing the internet. But management is so much broader than that. Effective management is simply the process of making sure something runs the way it is supposed to run. And in real estate, if you are good at managing a property the way it is supposed to be managed, you will create value.
The only kind of real estate that provides residual income is Buy-Rent-Hold property. Buy-Rent-Hold property creates a monthly cash flow while the tenants also pay down the principal owing on your mortgage, increasing your equity. This all happens whether you are at your home or on vacation in Hawaii. Pretty nice…
But all your profits can be evaporated in a very short space of time when the property is poorly managed. Any investor who’s been in the Buy-Rent-Hold business for any length of time will tell you for certain that the value is in the management. And conversely, if the building you buy is poorly managed, you will find yourself in a very undesirable financial position rather quickly. Knowing how to manage a building is a crucial component of real estate investing.
It is possible that you would hire a property manager for your Buy-Rent-Hold portfolio. However you will still need the knowledge of how a building should be managed, and what the key indicators are that you need to keep an eye on, so you can ensure the manager you hire improves, not destroys, your good investment!
Buying an investment property is the same as buying a business. The investment is the land and the building on top of the land is the business that pays for the investment. If you bought a business and managed it poorly, you intuitively understand that the business would not survive. Real estate investment is no different. This is one of those can’t miss critical trainings for your success in real estate.