Archives for May 2020

Property Manager Nightmares

When we look at building a large portfolio of rental properties in real estate investing in Calgary or any market outside our “backyard’ you need to hire a property manager. Or do you? This was what we thought when we started in multi-family buildings.

The asset was out of town and not a logistical drive time to our home base – so we hired the largest management company in the town.  Things were good for a time until the real estate train started to fall off the rails BIG TIME! Turn over, repairs, lease-up fees started to steadily rise over just about a 1 year period.

There was a staff change over at the company, which normally should not have the impact that it did if they have good systems in place.  What I learned was that the company did not own any multi-family buildings and had the following bad habits:

1. Used their own repair company that caused a bunch of issues with repeat repairs

2. Every little maintenance item was being fixed with expensive trades for items that were often tenant caused or part of normal tenant maintenance.

3. Tenant screening was not done very effectively

4. Overtime being charged for non-emergency issues

Some of the things that you need to consider when looking for a property manager are items such as:

1. checking references and referrals from other building owners

2. Deciding when you actually need a property manager

3. what is their reporting process for repairs and items that come up within the building

4. What is the tenant screening process they use

5. How often do they inspect the units?

A management company that does not OWN real estate will never treat the building with the respect it deserves, because they only think like a fee-collection machine rather than how to keep the building running smooth – for the most part, not all management companies are bad.  I have just never found one that is highly effective that does not own real estate themselves.

With this asset, the solution was to hire a resident manager and shift the asset management role in the house, which is critical for the success of a multi-family asset.

Property managers left to their own devices can wreak havoc on your portfolio – you have to manage the managers even the best ones out there – because things can change such as a key staff member leaving and causing issues until they have a great replacement.

Have a hard look at whether or not you NEED a property manager, with all the modern advances in technology having a resident manager + an asset management plan could be a better way to manage your remote assets.

To you success

Tim Reid

-Respect The Hustle

National Turtle Day 2020

Turtle day, slow methodical ways, get rich quick

Today is national turtle day, which made me think (other than of my appreciation for turtles and all things nature) of how the life of a turtle with their slow methodical ways relates well to real estate. There are so many “get rich quick” schemes out there, and a lot of actors in real estate that make it look as if there is quick money in the game of real estate investing.

Can you make money quicker than some other methods in real estate? Of course, you can, however, that is not possible until you have education, experience, a good business model built with excellent systems! Flipping houses looks fast on TV, however in real life depending on what market you are in it typically takes 3-6 months to take a project from A-Z.

Could you flip 30-50 homes/year? Yes it can be done and I have associates that do this in CERTAIN markets in Canada and the USA – that takes a lot of help (staff) capital and credit + a lot of experience which results in a great system that works for your local marketplace – did that happen overnight? NO! It happened over years creating and refining the systems so that those real estate entrepreneurs could scale their business to that level.

When you get into learning any game in life, real estate, business, hockey, monopoly you will lose a few games learning the rules – I think we can all relate to that! Real Estate Investing is no different, you will have to learn the rules, make some mistakes, and get better as you go.  The best way to collapse that learning curve and avoid mistakes is to work with someone that has been there before and lost a bunch of games to get really good at it – real estate coaches in your area/strategy that you are interested in will really help you get results faster.

Real Estate like the turtle, is not going to make you wealthy fast – but it will get you there using consistent methodical strategies. Be like the turtle not like the hare of the children’s fable running around without the right tools/mindset to be successful.

To your success,

Tim Reid

-Respect The Hustle

 

Flipping Houses in Uncertain Times – Tips and Tricks

tricks,tips

There are uncertain times ahead for Calgary real estate investing, Investing in Alberta at large and around the world at this time.  One of the most popular strategies is generally flipping houses, which is on all of those damn TV shows that give people a “reality tv” view of the world which is 100% false!

Will, there be deals in this marketplace I have been asked a lot recently – I think there certainly will and we have been seeing those starting to happen.  When it comes to flipping homes there are some key ingredients;

1. Making money in the BUY

2. Keeping your budget under control – 15% contingency for the renovation and for the ARV

3. Manage the time so your project is done on time and back up for sale quickly

4. Ensure that your sales price is one that will sell quickly (below market for the renovated condition)

5. Don’t get emotionally attached to a sales price – you need to drop it until it sells.

The market will be unpredictable, there are a lot of factors for real estate investors that need to be considered:

1. affordability will be down

2. not as many buyers in the market

3. housing starts in Alberta will be way down this year

4. Inventory will move slower than normal

5. Value placed on renovations will be lower in some price points

Real estate is a business that is all about the numbers, when you are flipping a house there is not a lot of customer service, warranty, staff to worry about (until you are a much larger organization) because most of the operation is done with contractors.  When you are executing in this market space in Calgary especially that has been hit hard recently due to the pandemic of COVID-19 – you need to work with others that have been there before through different market cycles.

Is this your first foray into real estate, congratulations you are getting in at a good time – why? Because more money is made during a crisis than at any other time.  That said, the exit for the real estate will be more challenging, you need a rock star real estate agent and power team to help you.

We are here to help serve and support connecting you to the right resources to be successful in this area of real estate or any other you looking to learn or expand into.

Contact us here to book a time to chat

 

To your success,

Tim Reid

-Respect The Hustle

Is Sales a Dirty Word Still?

thingking, idea, settings, money

I was on a masterclass with Lisa Sasevich who is known as the creator of the “invisible close” and she was giving out the gold nuggets on this call for sure! During uncertain times we as business owners, entrepreneurs, and real estate professionals start to think …WOW I can’t sell right now people are scared!

There is certainly a right way and a wrong way to do sales in any world environment, that is for certain.  This all comes back to how much you believe your product/services HELPS PEOPLE! Certainly, there is a more delicate approach to your messaging, your tone during times of economic challenges – shift to educating and serving your customers/prospects in any way you can (which you should do anyway) even if that is a referral outside of your business.  No, this will not hurt your sales in the long run – you will get referrals in return by being helpful and a “good corporate citizen”

Now, when times are more challenging fear goes up both in the prospect and the company – fear of rejection, heightened emotions, all of these things contribute to call-resistance (reaching out to customers on whatever channel works for you) this is NATURAL. The trick is to surround yourself with positive influences like Lisa, other thought leaders like Brian Tracy master sales trainer – and many others to keep you motivated to PIVOT and offer new services consistent with the current needs of the marketplace.

There will be people that reject your offers, that is OK they are just not ready to take the journey to the outcome that the product provides – that has NOTHING to do with your personality, keep that fact in mind it will help your resistance to make those calls on your clients. Sales is not a bad thing, or a dirty word – nothing happens in the world without sales, relationships are sales, getting on the damn phone and calling your network, vendors, clients are sales – you have to sell yourself on doing those things.  Sitting on the couch and watching Netflix is a sale you made to yourself – too much of that won’t get you closer to your goals…but it’s still a SALE. The word can be neutral, negative, and VERY positive when your company brings value to the customer’s life.

To your success,

Tim Reid

-Respect The Hustle

Targeting Gazelles in the Lion’s Den

target your customer, advertising,leader, brand,change,innovation

Today I was on a call with one of my mentors and was reminded of a few key factors in determining your target market.  Often I have heard him say you would never go to a church of X religion to find people of Y religion – that would be crazy right? However a lot of businesses out there do just that – they go to places where their ideal client does not hang out. Imagine looking for “Gazelles” in a watering hole where all the “lions” hang out….are there many Gazelles there? NO!! (unless they are stupid Gazelles – which I am sure you don’t want anyway!)

Further, having an ideal client in mind would really help as well – most businesses do not have this very well defined either. The common thought is that EVERYONE can benefit from my product! The fact is that most people do not want it or even know how it could help them. This leads me to the critical point that this mentor made: what are so many businesses doing the DOUBLE SALE?

This process means you are finding someone who does not know the value of the product or service and isn’t thinking about it or how it can help them at all. However these people do fit the demographic that can afford/will benefit from the product.

Now, with a loose target market you can do decent – with a highly defined market you can really thrive and reduce the work it takes to close a sale. If you are putting messages out there that attract clients that are already thinking about the problem your product solves then it will be MUCH faster of a sales process which is great because you get to serve more people faster – notice I didn’t say make more money! The making money part in business is simply helping people solve a problem/serving them and the money+profits are a nifty side effect!

Having to educate/sell someone on why they need your product/service and THEN sell them on the product itself is a lot of work! Why would any sane business owner do that? Well generally because their marketing, messaging, positioning, is not attracting IDEAL clients.  I need to reference the 80/20 rule here which states that 20% of your clients generate the most revenue/profit for your company – those are the ideal customers.  The other 80% take up a lot of time and energy and they do not refer, and will leave for the competition if they smell a better deal.  Which category would you rather focus on? It is OK to FIRE customers that are not in alignment with your core values. Dial in your target market or “niche” and you will dramatically improve your results.

To your success.

Tim Reid

-Respect The Hustle

Comfy Is Not Where Success Lives

Man walking through giant wrecking balls, signifying stepping outside of your comfort zone

Continuing with our motivational series – today I wanted to touch on a topic that is often over looked when we thing about our success in real estate, in life, in relationships.  The comfort zone is the main enemy of success and growth, because simply put: if you are not growing your skills/knowledge/communication your results will remain fundamentally the same!

It has been said that “if you want to get something you have never had, you have to do things you have never done before – what got you to this level of success will not get you to the next level” I believe that is 100% true, when there haven challenges in our business it always traces back to something that we did not know.  Also, we never know what we don’t know – the paradox of life and business in real estate or any other.

Growth will always be uncomfortable, making the cold calls, dealing with upset customers, door knocking, figuring out social media – our mind is programmed to caution us from uncertainty, doubt, fear.  That is a normal response (from the hunter/gatherer perspective), it is how we acknowledge those thoughts and move past them that counts. We no longer live in a world where we can get eaten by a lion every day, so those old programs can be re-trained, if that sector of our brain had its way we would never do much at all!

This is why we have to develop a community of mentors, partners, associates, master mind groups to get outside of our current knowledge/abilities and push for that growth+ see within ourselves the potential that we can’t always see.  We are better together, business is a team sport and I would suggest to you that so is life in a lot of ways – having mentors/coaches for fitness, spirituality, relationships is the only shortcut to excellence/up-leveling your game.

It has been said also – I love this quote BTW “If you want to go FAST- go alone. If you want to go FAR go with others”. Often when we are going fast alone we could be headed in the wrong direction or right toward one of the pitfalls of business/life! We will fall into those no matter what, and that is how we grow – through the challenges of life.

The universe (or higher power of your understanding) gives us GIFTS they are wrapped up in challenges, and the larger the GIFT the larger the Challenge it will be wrapped up in.  I would suggest that you consider when a challenge comes up “what am I meant to learn from this challenge?” This has helped me orient my thoughts on solutions, being grateful, and moving forward.

To your success,

Tim Reid

-Respect The Hustle

Is The Ship Without A Captain?

motivational series, success, goal
300

Rolling forward with our motivation series, I wanted to go over today one of the most important ingredients for success in business, success in real estate, success in life in general.  Having a GOAL is that ingredient, now we have all heard this before right? Why is it then that when the statistics are tallied – more than 2 our of every 3 people don’t like what they do for work and where they are in life?

I would suggest to you that a ship or airplane with the best captains in the world, will go nowhere and drift through the air/water and more than likely crash and burn if there is no destination they can pilot towards.  Put another way – if you don’t know where you are going, how the heck can you MAKE A PLAN to get there?  It has been said that the difference between a goal and a dream is that one has a plan/deadline, I am sure you can guess which!

Without health goals, we generally (unless you have lucky genes) are less healthy than we want, we don’t earn the money we want, we don’t have the relationships we want.  The key is to have targets to shoot at in all areas of life so that you can measure if what you doing is working or not.  What gets measured gets managed, things unfortunately do not take care of themselves in life or business.

What is the thing that can tie all of the goals together? There are many different angles I have heard, your “why”/”purpose”/”destiny” — whatever you call it that resonates with you, I suggest to you that you sit down with a sheet of paper thinks about this in detail 5-10 minutes each morning and WRITE down ideas for the thing that you want to accomplish in life that if you die before it’s done OR you would feel embarrassed to be dead!

All joking aside if you have a destination that you want to go and you have a burning desire to make that thing happen then that will be your motivation to get back up when life knocks you down, when you get betrayed in a relationship when your deal goes sideways, everything in life is temporary the only place we exist is in the present moment – make that the one you focus on.  Learn from the past but don’t dwell on it because you don’t live there anymore.

To your success,

Tim Reid

-Respect The Hustle

Where Dreams Go to DIE

personal growth, take action, dream big, set goals

WOAH What a title for a real estate blog! Well, I have been doing a lot of personal growth, motivational listening recently due to the current status of the world with the pandemic.  I will be continuing that practice at a higher level than I did before even after things to back to the “new normal”

I had recently been on a webinar with Les Brown speaking, and I have been studying his lessons over the last few weeks.  Personal growth is just as important as growing your success skills in Real Estate Investing or your profession – even if that is currently disrupted by the status of the world.

Les talked about a minister that stated that the wealthiest place on earth is actually the grave-yard! This is the final resting place of so many people that never pursued their dreams, their inventions never saw the light of day, books that never got written among other things. The primary reason for this is FEAR;

Fear can also be defined as: False Evidence Appearing Real. We are only born with 2 fears

1. fear of falling

2. fear of a loud sound

The rest of the fears in our life that we experience are LEARNED behavior, think about that for a minute.  Unfounded fear of failure, ridicule, making mistakes holds so many people back from getting what they want in life.  Do you know someone who complains endlessly about their job? relationship? health? Yet they do nothing about it? I think we all know someone like that – or at least we used to and are now upgrading our average of the 5 people we associate with the most.

Real estate, businesses, investing in stocks (actively) all have risks – being a highly successful entrepreneur takes being dedicated to a level that most people would call crazy~! That is OK, the people that think that is not your kind of people anyway…be confident in that, go after your dreams and level of success you WANT because you are capable of more than you can ever imagine.

To your success,

Tim Reid

-Respect The Hustle.

The 3% Rule to Join The 1%

keep learning and growing

I have been doing a lot of reading these days, as much as possible considering the long workdays.  When working from home one might think you would be working less, but that is certainly not the case for our business in real estate!

One book I am ready by Brian Tracy talks about a formula that I have never heard before.  It is called the 3% rule for investing in personal development. I have been a huge fan of personal growth/professional growth for many years – my telecommunications engineering world was always changing so adapting and learning new things was just a matter of course of the industry.

This is not always the case in many professions out there, often you learn the job in the first 3 months, and then that’s it – you could do essentially the same thing for 25 years.  What would your professional life or business look like if you invested 3% of your earnings in courses, coaching, seminars, books/audiobooks each year?  The results in the book were staggering – about a 50% increase in income, each year was the case studies used! That is some incredible leverage! (one of the best things about real estate investing is the leverage)

I certainly make an effort at our company to be growing and learning all the time – because if we are not growing we are dying….both mentally and physically. Real estate, entrepreneurship, life in general I think everyone would benefit from taking whatever percentage works for you and making sure you budget for, purchase, and most importantly execute on the things you learn from personal/professional development resources, you will be happy that you did!

To your success,

Tim Reid

-Respect The Hustle