by Drew DeMasters
Three common mistakes often trip up landlords. But if you find yourself caught in one of these, theres hope!
Mistake #1 “ Not protecting yourself
Do you have an iron-clad credit check, background check and rental agreement that you put all applicants and new residents through? If not, stop reading right now and go to a reputable site to download the forms and sign up for tenant screening services.
Whether youve just bought your first rental property or own 20 houses, you have to protect yourself. Everything else pales by comparison! You want to ˜stack the deck in your favor of finding, keeping and making more money with great residents in your properties. And dont skip a step; theres too much at stake. Always run a credit report, a background check and use a thorough rental agreement with all the detailed clauses about your policy on waterbeds, roommates, pets, smoke alarms, etc.
Mistake #2 “ Not recognizing you are in the relationship business You are not in the rental business or the property management business. As a landlord, your #1 priority should be to manage relationships. The contractors you use like painters, plumbers and electricians are the ones who help manage the actual real estate. But your job is managing your residents, your customers. Face it, the nicest house with the freshest paint and newest kitchen, bath and all the amenities isnt worth squat without a customer. You dont make a dime on the place until a resident signs the lease and moves in.
When you wake up in the morning, ask yourself ˜how can I make new relationships or build better ones today? Then keep that in your mind as you prioritize your day. It helps cut out the distractions that creep up on us. The U.S. Marines have a saying “ ˜Do it, delegate it or delete it. How can you apply that? Since youre in the relationship business, do only the things that make new or build better relationships with your residents. Delegate other things that need to be done but arent directly building relationships. And delete everything else off your list. Soon you will be accomplishing much more, much faster.
Mistake #3 “ Not taking time out to ˜sharpen the saw When was the last time you worked ON your rental business? Maybe thats a strange question. But theres a big difference between working ON your business and working IN your business. Dr. Steven Covey explains the term ˜sharpen the saw in his excellent book The 7 Habits of Highly Effective People. When we answer the phone, show apartments, collect rents, screen tenants, and handle maintenance requests, we are working IN the business. Going about our usual day in the usual way. But when you attend a conference, read a book, watch an educational DVD, or go to your local REI or landlord association, youre working ON your business.
Both are important; you have to do both to be successful. But when things are the craziest and the pressure is on, what gets eliminated first? Its the books, DVDs,conferences and landlord meetings. Somethings got to give. There are only so many hours in the day after all.
But failing to work ON your business is a bit like the struggling company that lays off its sales force to save money. Its a knee-jerk reaction that only exacerbates the problem. So make it a point to preserve some time to step back and invest in your continued improvement. Like a shot of Redbull for your bottom-line, the time you spend learning ways to do things better will keep you motivated, excited about the rental business, and it pays off in spades down the road!
Like the Dos Equis commercial says ˜stay thirsty, my friends.
Drew DeMasters is a landlord, author and marketing coach with 15+ years in the rental business. His new book is now available at www.landlordmarketingsecrets.com. Winner of a 2009 Echo Award from the Direct Marketing Association, DeMasters holds an MBA in Marketing from the University of Missouri “ Kansas City. He is available for coaching or to speak to your landlord or business group and can be reached at [email protected]
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