← Real Estate Rookie
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- [00:00]
A
Being a landlord sounds simple until you're the one getting the 2am call about a leaking toilet, or worse, you have no idea who to call to fix it. That's when you realize this isn't just about owning rental property. It's about having the right systems, tools and backup in place so you don't lose your sanity along the way.
- [00:19]
B
And here's the thing, most rookies think managing a rental yourself just means collecting rent and maybe mowing the lawn. But there's an entire set of essentials that separate the landlord to burnout from the ones who actually scale and succeed as real estate investors. And today we're breaking down 10 things every DIY landlord needs in their toolbox.
- [00:43]
A
This is the Real Estate Rookie podcast and I'm Ashley Kerr.
- [00:47]
B
And I'm Tony J. Robinson. And with that, let's jump into DIY tool number one.
- [00:52]
A
The first one is property management software. And I feel like this can go with any strategy that you're doing is some kind of software to track your property and to communicate. So long term rentals, short term rentals, midterm rentals, house hacks, rent by the rooms, all of the rental strategies you need some kind of property management software. So when I started investing, well, before I even started investing, I worked for an apartment complex and this was their system. It was a sheet of paper with drawn out grid lines, the month, the tenant's name, and then a check mark if they actually made payment or not. And that was how they tracked the rent. This was for a 40 unit apartment complex. Okay, so you don't want to have to do that because it was so aggravating and it took me a long time to actually get a system in place, but I found a property management software, I started implementing it and it saved so much time, but also created so much accuracy. Can you imagine like if a tenant came in and said, I paid rent and I say, no, you didn't. And then I show them that grid line thing that says, see, there's no check mark here, you didn't pay rent.
- [02:18]
B
It's crazy to me to think that in the day and age we live in that folks are still using pen and paper guys. I get pushback sometimes from folks who are new investors, like, okay, do I really need that? And I think for this software where the cost is pretty nominal, the value that you get far exceeds the cost of that subscription. And not only do you get pre built tools that are purpose built for your asset class, for managing your property, but to Ashley's point, you get records that are rock solid if you ever need to fall back on them. Some of the ways that we use property management software in the short term rental space, we use it for a lot, honestly. We use it for guest communication. So we're on multiple different platforms, especially for the hotel. For the hotel we're on websites I've never even heard of before sometimes. And instead of having to log into all of these different platforms separately, we're able to communicate with everyone through one unified inbox within our pms. So it takes in all the matches from these different platforms and gives us one unified inbox to communicate with. We can even send like SMS email platform messages all through our PMS software. So guest communication is a big one for us. Vendor management is another reason that we leverage property management software. We can and you know, we have a separate piece of software now that's specifically for maintenance, but when we first started we were using our PMS for that and our cleaners would get notified if there was a turn that needs to be happened and they could flag issues during their turn if they noticed something was broken. So it's our maintenance and our cleans inventory can be managed through there. Another big one for us is managing our calendars. You know, if someone books on Airbnb, we have to block that data on vrbo. And without a PMS we would be doing that manually. I mean the list just goes like on and on and on and on and on and on about the different things that a good property management software can do for short term midterm rentals.
- [04:11]
A
So I guess let's maybe go over like some of our favorite ones of these. The show is sponsored in no way by any of these. So these are just Tony and I telling you, you know, software that we have used or you know, that we've heard other people have used that have had a great experience. And at least for the long term rental side, I've used several different ones over the course of the time. But my favorite ones, if you have a a large amount of property is these only make sense at a large scale because their minimum to actually have the Software is like $400 per month. And if you have one or two units that will kill your cash flow, it's not worth it. But that's AppFolio and Buildium. So as you grow and scale, like even if you get to like maybe 50 units, just the bells and whistles that they have could be worth it for you. But the basics, I like Rent Ready and I like Turbo Tenant. They have the basic necessities that you need, the things you need and then there's extra little things that you can add on here and there. Turbo Tenant I really like because they have a lease audit. You can upload your lease agreement and they'll tell you based on your state what things that you know you should change or, or not or what things you should include based on your state's laws and regulations. So I really like that piece of it too. And then for midterm rentals, I've just used that through my short term rental database because I've not. I know that Furnish Finder has something that they're starting to build out. I don't know exactly how full their capabilities are. I think maybe rent collection, but I've always just used short term rental software for my midterm rentals. But I do know that some people do use long term rental for the midterm rentals too. Especially if they are sending out an actual lease agreement and not like booking through Airbnb or something like that.
- [06:08]
B
Yeah, I think for, for us, some of the big names come up. Hospitable is one that we use virtually from the beginning of building out our, our portfolio. We use Guesty now for, especially for the hotel and just it has some functionality I think that works better for properties that are, or portfolios that are scaling kind of like you mentioned building them and you know, AppFolio versus TurboTan and Rent ready. I think Guesty is really good if you're kind of getting to scale or if you're a short term rental property manager. If you're a co host. I think Guesty has a lot of features that make it good for folks who have slightly larger portfolios. Hospitable is a little less expensive, a little less features. Guesty is a little bit more expensive with a little more features. So you can kind of pick and choose where you want to land there. But both are pretty plug and play I think, easy to use out the.
- [06:56]
A
Bat and then I use Hostfully for mine. I've never even demoed or tried any other one. That was just the person who was managing my properties, which she wanted to use. So we've just stuck with that and it's been fine. What about the maintenance side of things? Tony, you mentioned that integrating with your property management software.
- [07:13]
B
Yeah, so when we first started we were using our property management system as like a quasi maintenance kind of cleaning database. But now with just the size of the portfolio, we use a separate piece of software called Breezeway and Breezeway is our kind of back of house operations for cleaning tank tasks, cleaning checklists, inventory maintenance. So Breezeway is what we use and it works incredibly well.
- [07:36]
A
I've just started setting up Terno, so that's one that integrates with hostfully and came highly recommended to me. I'm not fully set up in it and operating it, but stay tuned, I'll let you guys know how that goes. But it seems like that's something similar to what you're using.
- [07:53]
B
Yeah, very, very similar. Turno kind of started off as like a, a marketplace to help folks find cleaners, but they've I think added some software behind that service to, to improve what they have. What about flipping, Ash? Have you used any software for flipping?
- [08:09]
A
No, just like a project management board to like manage the project and manage the contractors. But I know there's like, like different software that you can use to actually like send out the estimates. And like our friend Tyler Madden who does house flipping, he like they every day at the end of the day they send an update to the owner. So they're using some software. I think his Instagram is at Tyler Madden, just his name, but you could message him and ask. But I, I'm pretty sure it's like they, it's a software where they're going through and it's for when they remodel home so that they can show their customer at the end of the day like what the progress is, what was done and each day the person's getting an update with the photos and things like that. So if you're flipping you could probably use the same thing where your contractors uploading the photos to you, sending you the progress, any notes, any updates, things like that I think would be a good way to communicate and track your flip.
- [09:07]
B
You know, I think about the more experienced flippers that we know, James Tainer, Tarrell Yarber, both of them were using Excel spreadsheets at least for their scope of work. You know, I think it's interesting that we've, we've got all this software that's evolved for the rentals space, but maybe not as much for flipping even like wholesalers, like there's so many CRMs that are out there for wholesalers or people doing a lot of direct mail marketing to find off market deals. But it seems like flippers for whatever reason have been kind of left in the dust there. There was one piece of software that I had heard of that we tested out briefly called Flipper Force. Have you ever heard of that one?
- [09:44]
A
No.
- [09:45]
B
Yeah, it was kind of like a scope work type thing. But we end up just going back to, to an Excel sheet, you know, so we gotta find a good solution. So if you're a flipper out there and there is a piece of software that you use for scope of work or project management, let us know because we'd love to highlight it here for folks who are looking to flip.
- [10:00]
A
Yeah, the only one I've heard of is like builder trend, but I, I think that's to build out the scope of work and then you like send the estimate. But I don't know any other capabilities outside of that besides building the scope of work and sending out the estimate. And like I don't think anything to like actually track the progress of it. Okay, so the next thing kind of goes in line with that is having a reliable vendor list. So we're going to get into project management software later in this episode. But one thing that I keep in there is I track all of our vendors. So that's vendors that we've used, you know, their contact information, the if we used them, what the outcome was, are we using them again? A list of contractors like referred to us who we want to use and then a list of contractors where it's literally their truck was driving by and we took a picture of their truck and entered their information because it said the painting shop and their information on there as to like here's, you know, some contractors we can go to. If we're in a crunch or we want someone else to bid something out, we keep those. So those kind of three sides, separate list. And we always have like our preferred vendor. So like all of our plumbing issues, our H VAC issues go to this one company called bnr and BNR gets all of our stuff and they give us good pricing. They also are super efficient at scheduling with tenants and also like being there, you know, making us a priority because we do send them so much business. So not only having that vendor list of who you can contact, but really establishing those relationships too with those vendors.
- [11:50]
B
Ash, our process is almost exactly the same as yours. Same in our reuse Monday.com, which we'll talk about later. But saying we have like a section inside of Monday broken out by market and within each market we have our service providers and it shows like you know, who's the person, what's their service know, contact information and same we have like our go tos where it's like if something happens, our VAs know to call this person first. If that person doesn't answer, then we Go to the next person and we just work our way down the list of all of our approved vendors. And sometimes something pops up that maybe we need to find someone new, you know, or maybe our, our usual crew of folks don't have the skill set to tackle whatever issue just came up. And then we'll go out there and we'll source someone new and if we like them, then we add them to the board. So, yeah, I think it takes some time to build it out initially, but searching Google Facebook groups recommendations I think is probably the best way to kind of build that out if you can find other investors in your market who already have trusted contacts. You know, I think people are like much more willing to share their plumber and their H VAC person than maybe they are to share like their, like their wholesaler. You know, like, they might have a little bit more hesitation to share the person's like, giving them all their good deals. Um, but like all their trades folks, typically people are willing and open to, to share those, you know, because like, we're me as one person, I'm not going to keep a, a plumber busy at 40 hours a week. Right? Like, they got to fill that time with some other folks. So I think getting referrals is the best way to start building that list out.
- [13:19]
A
And to the thing. The whole point of this is so that when you need one of them, you are not panicking trying to find someone. Like some other little things you can add is like, who is like 24 7? Like, are some of the plumbers 24 7? Are some only available nine to five during the week? Like the appliance vendor we use, they are very mom and pop. They are amazing. But it's like you, you call their house phone to schedule, so if they're, they're not home, they're, you know, you're leaving a message, you know, and they're not working on weekends and things like that. So like adding in those things too. So, you know, like, okay, this is not who I should be calling at this time. But that's like the big thing is you have the list already and you can even go as far as like calling them, letting them know you have this property and you're just, you know, get some quotes from them, get some pricing as to like, do you even service this area? Do you come to here? Like, I've had contractors literally in the next town and they'll be like, no, we, we have so much business right where we are. We don't even drive that little bit extra to go there. So I think just having an initial phone call can go a long way, too, as to, like, figuring out what their service capabilities are, what do they charge for? Some of the standard things you would need can go a long way, too. And then just like, keeping those notes and tracking everything. And you don't really need a project management board to do this. You can do this in Google Sheets, Excel, like, to track all of this. Just like. And the reason I do it is because when I actually do build out those boards, I'm actually connecting the vendor and their contact information as to like, okay, this is who I get this estimate from. And then like, okay, this is the vendor that's actually doing that. But you can absolutely just do this on, you know, a spreadsheet.
- [15:11]
B
I think just like, the last thing I know we're talking more so about, like, keeping a database of these folks. But just word of advice, when it comes to working with them, sometimes I think it makes sense, even if you, like, overpay a little bit, just to go back to that person that's more consistent for you, because they'll remember that, you know, and it's like, we've gotten, like, from our, like, you know, I think about one of our crews we work with in jt, and there's been plenty of things that he's done for us and that team has done for us where we know that they, like, maybe didn't even charge us for some of the things they've gone out there and fixed. You know, they're like, it was such an easy thing. Like, I was only here for five minutes. I'm not even going to charge you. So when we get an invoice for something else that we feel is like, man, that kind of feels like a lot. We're okay with that because we know that, like, net overall, it's still a positive win, win for both sides, right? So I think sometimes we can get so bogged down in, like, the, you know, pennies and nickels and dimes that we, you know, we, we maybe damage relationships that are worth far more than that. So just word of advice for rookies is, is value the relationship over maybe the, the small dollars and cents that you're. You're. You're charging.
- [16:13]
A
And that not only goes with the vendor, too, but that also goes with your tenant or the guests that you have staying in your Airbnb. Like, the more efficient the convenience of, like, getting that person there, like, even if they are more expensive or whatever, you're pleasing all sides of that triangle. So like don't ruin the relationship with your tenant or the guest or like give them a bad experience experience with you as the landlord or the host because you're trying to nickel and dime the contractor to have him go out and fix this issue so they can stay. So like it's, it's a ripple effect almost. Okay, so we have to take a short ad break. We've gone over two different tools you need and when we come back we will touch on communication and how this is key to your business. We'll be right back.
- [17:02]
C
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- [17:42]
D
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- [18:28]
C
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- [18:58]
A
Okay, welcome back. The third thing that you need in your tool belt is a contact number that is not your personal cell phone number. So not only for reasons of having people blow up your phone, people call you to complain, you know, whatever reason, but also for the fact that if some point in time you are not available, you don't have to physically hand your cell phone to someone to take your calls, or you don't have to forward your cell number to somebody else where they're getting all of your calls. Okay? So my recommendation for this is a Google Voice number. And you can set them up for, like, unless you're doing crazy amount of calls, it's free to do with your Gmail account. So this is what I did from the beginning. Well, I shouldn't say that, not from the beginning. At first, I had two cell phones. Okay, I was. I got two phones. And that was just like, crazy. That was like too much for me. So then I went to using Google Voice. So that is the dedicated number. You get a separate number, and that is the one you can give out to your tenants, you can give out to your ve vendors, you can give out to whoever. Like, I just did like online forums to get my insurance quoted just to see what it would be. And I gave out my Google Voice number because I'm like, I've done. I've had this done before where I accidentally put my phone number into some spam thing where they're selling my phone number to $50,000 insurance, you know, 50,000 insurance companies. So this is what I highly recommend.
- [20:38]
B
That's actually a really good idea, you know, because like, I even like when you apply for a loan, you know, sometimes like then you get blown up by everyone on the planet who wants to give you a loan. So I like the idea of putting a Google Voice number for that too.
- [20:49]
A
That's sort or buying a website domain. Oh, I forgot the one time. One time of all the domains I forgot or I bought to check the little mark that I want. Like the security thing where my information isn't sold out. Oh, my God. This was over a year ago and I'm still getting phone calls. Are you the owner of blah blah blah? And I just say, no, I don't even know what that is. But yeah, one time I did it but anyways, you need to have some kind of to manage your properties, some way to reach you. It like a tenant to be able to call you. Yes, the property management software has, you know, the texting communication that you have. Email, there's so many other ways. And like in my lease agreement I list the preferred ways and phone call is the very, very last way. But sometimes there is the tenant that prefers to call. There is a reason for them to actually call and not message. And they can text through the Google Voice too. But I like to keep that within the property management software. Tony, what about for short term rentals? I've probably had a guest maybe call me twice the whole time I've been renting Airbnbs.
- [22:00]
B
I mean we definitely get phone calls. You know, just I think with the size of the portfolio it's bound to happen where we get at least you know, a couple a day. And we Sam, we use Google Voice also. We try and keep the majority of our communication on platform. But Sam, you know, we sometimes get guests that are older, you know that they just want to pick up the phone and call someone, especially at the hotel. Like I feel like the hotel is probably the biggest culprit of this right now, but we actually explored and I might end up going back to it, but a software provider called OpenPhone and similar to Google Voice but they've just got, it's a, you know, purposely built specifically for like online phone voiceover Internet. I don't know what it's called but they have a little bit more robust features around like call routing. It's like for example right now when I get a call on my Google Voice it just rings everyone's phone at the same time. So like I get my phone rings, Sarah's phone's ring, our VA's phones ring. But with Open Phone it can like route to the VAS first and then if they don't pick up, it'll route to us. Or if there are certain days and times like maybe our VA is off, it won't even ring them, it'll just go straight to us. So we're exploring Open Phone right now. I had like a free trial but I let it lapse. But I like some of what it offered. But I think especially if you're, if you've got like other people on your team, like you know, I have VAs that work for me. Ash. I know you do as well. And I think that's where the, the like Google Voice or Open Phone really comes into play because otherwise it becomes really Difficult for them to be able to fully take on all of the responsibilities. And if they can't text, if they can't call, if they can't, you know, communicate with folks who are here stateside. So definitely a tool that I think every DIY landlord should have, and I.
- [23:37]
A
Like the fact that you can oversee it. So you're able to log into the Google Voice and even if you don't, like, I haven't had it, like, come to one of the numbers we use. I haven't had it come to my phone in a long time. It goes right to the va. But I still can log in and I can still look. What are the incoming calls? Which ones are being answered, which ones aren't? How many voicemails are there? Are the voicemail numbers being called back the next morning in a timely manner? What are the text messages saying? So I really like that oversight, too, of it.
- [24:12]
B
And there's one other thing too, that Open Phone has that I don't think Google Voice has. But you can actually listen to the calls. So, like, you know, they're like, hey, this call's been recorded for, you know, training and security, whatever. And then you can always go back and listen to those calls and you can give your team feedback. That's one thing that Google Voice doesn't have. That also kind of, I think, pulls us into. Into Open Phone, potentially.
- [24:34]
A
My God, we could get some good content from some of those phone calls.
- [24:38]
B
We probably would.
- [24:42]
A
Okay, so the next thing we're going to talk about is I am so passionate about this because this has been one of the things that has literally changed my life for the better, and that is having a virtual mailbox. I used to be sitting in my living room with mail spread all around me. And at this time, I had a million things going on. So it was, okay, first I open it, then I sort it by each LLC or whatever it has to do with. Then I start with one llc and then I'm sorting it as to, okay, is this a bill? Is this something to be filed, something to be shredded? So sorting it that way. Then I'm writing out the physical checks. I'm putting it with the return piece of paper, I'm putting it into the mail, I'm sending it. This took up so much of my time. So then I hired someone to actually do it for me in person. And then I was paying a bunch of money for somebody just to open the mail and sort it and then to. I would have them get the checks ready and then I would sign Them and actually close envelope and mail them out. So with a virtual mailbox, all of your mail is sent to an address and you can find locations all over the U.S. this doesn't mean that it's like going to the Philippines or anything that you can put it to a location. Like, the closest one to me was like 20 minutes away, but I live in the middle of nowhere, so I set that as my address. So all of my mail gets sent to there. And then it's also, I think, nice too, for my tenants that they're sending it to my. Their checks to a local address too, instead of. There's not some random place, but. So all the. All the mail goes to there. When they receive the mail, they scan the envelope, the outside of the envelope, and I get a picture of it. It's like a portal. I can go into the dashboard, see what mail came in for the day, and then I can select which things I want them to open, which things I want them to throw out to shred, and which things I want forwarded to me where they'll actually send it to my home address and I can get it. So I still have four tenants that send in physical checks. And so every month, once their checks come in, I have the. I take it from the virtual mailbox and I have it forwarded to my house. I get it at my house, I write my deposit slip. I go and deposit it. So then all the bills, they're scanned in and I can just drag them into whatever Google Drive folder they need to go in. I can handle it. And eventually I built out a spreadsheet where a VA is going and looking at the mail and saying, like, okay, it's a bank statement. So it gets filed here. And I just tracked it all as like, if this is that, then it goes here, whatever. And then, you know, any questions? They just forward it to my email and say, hey, I'm not sure what to do with this, whatever. But this has been such a game changer for me. And it was, it was very cost effective, effective. I have to say it was cheaper than hiring someone to come and open the mail. But there's a lot of different ones. I use post scan mail, but there's a whole bunch of different virtual mailboxes and they have, like, different features that they do with it. The reason I chose this one is because they let you have a larger amount of LLCs or companies sent to the same mailbox without having to pay a ton of fees extra to have more sent to one mailbox. And Instead of opening two mailboxes, this.
- [28:13]
B
Is one thing that I've not done, and I'm not sure why, because I also hate mail. It's like, the bane of my existence, I feel like. And, like, our process right now, and it sucks because we've, like, had so many different processes, but, like, we had just our home address at first, you know, which was, like, the worst. Sarah and I are so bad at checking our mail that it probably happens maybe four times a year where our mailbox gets so full that we have to, like, they just empty out the mailbox and take it back to the post office, and we have to go to the post office to pick it up. So, like, okay, that. That's not, like, a good choice for all of our. All of our business mail. So then we got, like, a local. It's like a UPS store around the corner from our house, so we got a mailbox there, but then you got to drive to that mailbox to go check it, right? So it was kind of like the same. Same issue, but once we got the office, there's a. There's a mailbox here at the office, right? So now we just send most of our. Our business mail here. And the process for me is like, I'll check that mailbox, and Sam, I'll try and sort it out, and then if it's something that I need to do, I'll set it to the side. If something that my assistant can do, I'll just take a picture and send it to her. So we've kind of got a process right now, but I definitely like the idea of having someone that's just, like, dedicated to the mail. And I wish so badly that my assistant, like, lived here in California, but she's in Texas, because if she was here, she could just, like, handle that for me. So right now, that's the thing with.
- [29:30]
A
A virtual mailbox is you can be anywhere, and you can do it. It's in your mail.
- [29:35]
B
And. And that's why. I don't know why we haven't done this yet. It's just been, like, on the to do list. So I'm. I'm committing now to all the folks in the rookie podcast that Tony's gonna get a virtual mailbox set up, because it's just. Just, like, ballpark ash. Like, what. What should someone expect to pay for a virtual mailbox?
- [29:49]
A
I think, like, your Standard is, like, $300 for the year, and then it goes to, like. But I also have like, the. Probably, like, the premium thing or whatever, because I have a bunch of LLCs, but it also like varies on like how much mail you're getting. So like if you request for them to scan and open, you know, 500 pieces of mail, you're going to charge extra than if you have just like, there's like limits of like you get 100 free pieces of mail scanned each month or whatever. But yeah, I think it's like, I think it's like 300 per the year, whatever my plan is.
- [30:24]
B
Yeah. So it's what about like 25 bucks a month or something?
- [30:27]
A
Yeah, like a P.O. box is.
- [30:29]
B
Yeah, that's a. Probably. I don't know if it was 300 for the year. I think it might have been like 200. But they weren't scanning anything, you know. Right.
- [30:37]
A
Yeah. So and with the, the post office, you can get them to scan your envelopes in there is like a app you can sign up for. Because I had a PO Box prior to this and I had like. It's just like@the USPS.com their website or whatever their website is that you can sign up to have them scan your mail in. And it's not even them, it's just the envelope though. You're not getting your open mail scanned. So then you get anxiety of like, oh my God, what is this envelope? Blah, blah, blah, and think it's some horrible lawsuit or thing coming in. And it's just like you got a six dollar check from National Fuel, it returns you. Because you don't want.
- [31:18]
B
We actually do have that for our primary residence where I can see like the outside of the envelopes. But our mailbox that we had was ups, so they didn't offer like the virtual kind of like service like that. Or maybe they do. I don't know. Maybe I never even asked. So maybe it is something they offer. So.
- [31:33]
A
But still, it's not like you're seeing the inside of it, so you're not seeing like what you have to actually do for it. Yeah.
- [31:39]
B
All right, well, here it is. Tony's committing to getting a virtual mailbox. We'll set it up.
- [31:43]
A
And just so everyone is listening, I've literally been telling Tony about this for two years because I saw the picture that Sarah had posted of him covered in a pile of mail around him, and that's what I used to look like. Okay. So the next thing is organized file storage. So this kind of goes hand in hand. Like once you get a document, what do you do with it? And instead of having your shoebox full of receipts or having a stack of papers on your desk. I used to use folders. I would put everything into folders. So I had a folder for E. Like I had a section for each llc, one folder for receipts for that year, just for that year. One thing for tenant leases, one thing for capital improvements, bank statements, things like that. I used to do that and then I went to doing like a binder where I'd have a binder and I'd actually hole punch each thing and put it into the binder so it's separated by each bank account, the bank statements and things like that. But now I just strictly use Google Drive storage. The only thing that I have that's like paper and like physical that's sitting right next to me now are my title of abstracts that I don't know how to scan them in because they just come with like this paperclip thing. And some of them are so old that I'm pretty sure if I tried to scan them it would just like shred the paper through my scanner. But that, and then I have some surveys that they are scanned in, but I also have the physical copies and then my checkbooks, like I have physical checkbooks for every llc. I don't know if people still do that nowadays, but I still do have them and I do use them sometimes. But that is like the only thing. Everything else is getting organized and scanned in to my Google Drive. So that's restored receipts, that's any, any kind of documents that come in. Even if it's something that I think like I may never need again and maybe it's just a notice of something. I still just have like a random folder inside of each LLC where I'm just throwing that in because it's all scanned in for me anyways. It's not an extra step for me. So it's just literally drag and drop.
- [33:59]
B
Yeah, same. Same for us. We. We set ours up because you said you, you had like a folder for bank statements, etc. Etc. We do our. By the. By the end team by the property usually. So like we'll have one folder for that property and then like all of the things associated with that property for that.
- [34:14]
A
That's how. Minus two.
- [34:16]
B
Okay. Yeah, yeah, right. So same thing. So we. And then for a lot of the things who will. It'll exist inside of Google Drive. But a lot of times we'll access it through Monday again, which we'll talk about a little bit later. But Google Drive is just a place where we can make sure that we have our own copy of that because I think the downside of only keeping your files inside of your property management or your project management software is either one. Yeah, either one. Right. Like if you switch, you know, when there goes all of your data, you know, it's like you've got to figure out a way to get it all out. So we try and keep everything inside of Google Drive from like a storage perspective and then we just link to the file from Google Drive inside of our project management software.
- [34:53]
A
Yeah, I completely agree with that. I had to have our BA transfer from one property management software to another and she had to manually go in and like download because we had put every receipt in there because there's the one we were using, had like a bill pay option in there and manually go through and download every receipt or all of those. So now we do it, we actually do it double. So we're putting it into the, the software that we pay our bills in, we're putting lease agreements in the property management software and we're saving everything to Google Drive. It, it takes, I don't know, like five seconds longer to do it double. Just because the storing of the files is so easy. We just have a spreadsheet with like the quick links to, here's like the most common, you know, Google Drive storage folders you'll use. And it's just like you hit the link, you drag, drop, hit the link, drag and drop for whatever it is. So it doesn't take up much time. But one thing I will say too is like along with your receipts for your bookkeeping, you're going to want to have closing statements organized on your properties, if you sold them, if you bought them, surveys for your properties, but also your LLC information if you have an LLC or if you have a corporation having all of that information in one place. And then think about things that your lender asks for when doing bank financing. Because those I used to be unorganized as to where it would take me forever to find what I needed for the loan officer for each property. Like my property taxes for each property. Like I was literally just throwing the receipts into a folder labeled 2025 Receipts. And like I would have to dig through all of them to find all the receipts or my property taxes that they were paid because they wanted paid receipts. And a lot of times you can find them online now. But think about those things too and maybe create some kind of sheet that has the quick links to be able to access those also. Okay, our next thing here is number six and is the unit information sheet. So this is where you are going to keep all of your records. And you could do this just in a document and we actually have one for you guys@biggerpockets.com rookie resource and you can get the unit information sheet there. But you could put this into your project management board like Monday.com you can just have this in Excel spreadsheet, could be a Word document even. But is everything that you need to know about your property, you may never use some of it, but it is some of things that if you do need to tell somebody this information makes it so much easier than trying to figure it out. Like, especially as you accumulate a couple properties, they kind of blend together and if you've rented them out, when's the last time you've ever been at one of these properties? So I think Tony is a great example of this. Okay. He buys a property in the Smoky Mountains, he goes there when he first purchases it. Okay. And then it's been guesting there for the last two years now. There's a vendor there that's asking where is the water shut off for the property? And they can't continue forward until they know where the water shut off is or a guest is staying there and there's water shooting out of the wall. Where is the water shut off? So like that's like always my favorite example because I've also learned from experience that that's something I want my tenants to know, where that is so that it doesn't prevent further damage, but just things like that. Having all of this stuff listed out. So you have just like a one pager. I have this little cheat sheet that you can use if needed. And you can also give out to anybody on your team if they get asked these questions about the property.
- [38:44]
B
I was, I was looking through our property tracker is what we call it, as you were given your initial response, Ash. And we have a lot of the information that you talked about. We have all of the documents around the purchase of the property. So our purchase price, the escrow company that we used, our settlement statement, our closing disclosure, our initial insurance, we have our short term rental permit the day it expires, our parcel number, which Airbnb profile it's under the bedrooms, the bathrooms, the square footage. We have all of our utilities information. We have video walkthroughs of both the interior and the exterior, the location of things like the electrical panel, the propane tanks. So just like all the things that you would potentially need, especially if you're running this property remotely so you can quickly remember like, oh, man, where is the lockbox on that property? Oh cool. Here's a video of like where we put the lockbox, right? So it sounds like a lot. We even have like trash day, you know, like what day does do the trash cans need to get taken out? That's important for short term rentals. So I think as you're putting your property, as you're kind of setting it up, spending some time there to just go through with a super fine tooth comb and think what is all the information that I may need if I were a thousand miles away to still be able to manage this property effectively? You put all of that into one location and it makes managing it so much easier.
- [40:05]
A
So as we've learned, a little organization upfront saves you hours of headaches later. And when we come back we will get into lowering your risk and protecting your investment. We'll be right back.
- [40:16]
C
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- [40:57]
D
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- [41:41]
C
Inspecting your rentals again? Here's a pro tip. A simple checklist makes sure nothing gets overlooked. It saves you time and costly repairs down the road. And when it comes to managing your rentals, Rent Ready makes everything easier. Rent gets paid on time, leases get signed online, and maintenance requests don't get lost in your inbox. And if you're a BiggerPockets Pro member, I've got great news for you. RentReady is already included in your membership for free. Don't leave it sitting on the table. Log in to your BiggerPockets Pro account and start using RentReady today. Starting your own business can be intimidating because of all the hats you suddenly have to wear. There's the marketing hat for emails and social posts, the web designer hat for your storefront, the copywriter hat, the logistics hat, and of course the hat hat just for tracking all the other hats. It's a lot, but the right tool to simplify it all. Total game changer for millions of businesses. That tool is Shopify. Shopify powers millions of businesses worldwide, including 10% of all US E commerce. From brands like Mattel and Gymshark to ones just starting out. Launch your store fast with beautiful templates that match your brand. Shopify's built in AI helps with content too, writing descriptions and headlines and even enhancing photos. Want to market like a pro? Create campaigns wherever your customers scroll. Best of all, Shopify is your expert partner, handling everything from inventory to shipping and returns. If you're ready to sell, you're ready for Shopify. Turn your big ideas into you. Get it. Sign up for your 1 month, $1 per month trial period and start selling today at shopify.com bprookie go to shopify.com bprookIe shopify.com BP Rookie okay, welcome back.
- [43:12]
A
From our short break. Thank you for taking the time to check out our show sponsors. So we are on to number seven, your emergency fund. So these are also called your reserves. Setting aside money for repairs and vacancies and other unexpected costs that can come up. So what I do is I keep money in a high yield interest savings account. I use Baselane and I've also used Wealthfront too. Those are two that have really great interest rates right now. They're kind of like online banks or whatever. So easy to access things like that. If you need them you can just easily transfer right back into whatever account you need it into to go ahead and cover that that transaction. But I think like a big rookie mistake is like treating all of the projected cash flow as profit because you should be saving that for reserves if you don't have already a big meaty like reserves account that you're starting your purchase with. Like, I think the best way to take this is to have three to six months of reserves in place when you purchase the property. But sometimes that it's not always feasible. Plus if you use those reserves, you have to replenish it and there goes your cash flow for several months or whatever long it may take to actually fill that up. So Tony, what are you doing with your reserves? Are you keeping them in a high yield interest savings account too?
- [44:47]
B
So we use, we use Relay as our business bank. And I don't know if it's like a traditional high yield savings account, but they do offer, I think right now it's like three and a half percent, you know, whereas maybe like super high yield would be like 4. Somewhere above 4.
- [45:00]
A
Or.
- [45:02]
B
Yeah, you know, it's not, not a huge difference. But yeah, we, we keep it. We have a separate reserves account for each property. And the reason we do it on a per property basis just, you know, again, we have a lot of partners on our deal. So I can't like use the reserves from partnership A to cover something that happens on partnership B. So we keep a separate reserves account for each property. You know, one of the things though, Ash, that I think we, we discovered as our portfolio has matured a little bit is that in addition to reserves, one of the things that a good short term rental portfolio needs is just like a reinvestment fund because you also want to have money set aside for continuing to improve your property's performance. And sometimes that's small things like, you know, I don't know, buying a new gaming console. You know, like we went through this phase, we bought a bunch of Nintendo switches for our properties. Or it could be something bigger, like maybe we want to install, you know, you want to redesign your game room, or maybe you want to add a new amenity like Asana, or maybe you want to add mini golf or you want to do something. But I think setting some money aside on a monthly basis as well, strictly for reinvestment is something that more short term rental hosts should be doing as well.
- [46:12]
A
That is a great idea. And we haven't been touching our short term rental income at all, like in the past year, I think. Yeah, I think like over a year we haven't touched it and we've kind of just been like saving it in there for that purpose of reinvesting. But I've never thought of it that way of just like, instead of thinking like, oh, okay, next year I want to do some important improvements let's start saving this year is just on a continuous basis putting that money away aside to continuously improve your property, which is going to hopefully continuously increase your nightly.
- [46:51]
B
Rate or at least allow you to continue to compete. You know, and just really like the, the idea that initially came from again Sarah and I, we, there's this resort in Cancun that we like to go to and every time that we go they're just always like doing something and sometimes it's, it's, it's small things like they're replanting plants or they're you know, repainting the handrail. And this is a place that's like generally in really good shape already. But they're just like always doing little things to like keep it that way. And that was like an eye opening experience for us. It's like, well man, we did all this work to set these things up, but we have to continue to reinvest to keep them performing.
- [47:26]
A
Okay, let's move on to number eight, insurance and legal protection. So Tony and I actually did a rookie reply episode on this recently about insurance costs rising and what kind of insurance you need on your property. And let's just state the fact here that especially if you're renting out your primary residence or you're not being upfront with your mortgage or your insurance broker, that this is a rental property. A homeowner's policy is not the same as a landlord policy. It is completely, completely different coverage. So the first thing is to make sure that you have the correct policy in place and ask your agent or broker to spend the time going through your policy with you. Don't just take what they send you and say, here's the quote, actually have them walk you through what is covered. You know what, what could happen? Your deductible, what's your deductible? So I think really understanding your policy can make a, a big difference in what you do need and what you don't need, which can definitely change your premium too.
- [48:34]
B
Yeah, I, I think it, it's just a good practice to, on a regular basis, probably annually is like a good time to just go back and reshop your insurance and see is there a better rate that you can get from somewhere else or there may be new products that you should consider that you didn't know about before. But I think sometimes insurance can be one of those things that we just like set and forget and you forget that it is something that we should actively shop to see if we can get better, better pricing. So if you haven't reshopped your insurance in a while. You know, take this as a sign to go out there and talk to a few brokers and see if you can find something better.
- [49:07]
A
Tony, I'm following a couple insurance companies on Instagram that are short term rental specific or like they're talking about it a lot. I don't, I don't actually know if they offer other policies, but what their message is is that a lot of short term rental hosts don't have the property proper coverage that you need a short term rental host because they're not going to a short term rental specific insurance vendor, I guess be the word. Like is that true? Do you, do you see that happening too?
- [49:40]
B
Yeah, for sure. I mean at least from the folks in insurance that I've spoken with. Like the coverage needs are definitely different from a traditional long term rental versus a short term rental. I think insurance companies tend to view short term rentals as slightly more risky just because of the volume of people that are coming through. And sometimes in a traditional like landlord policy, if your average stay is less than a certain figure, it could negate some of the protections that you thought you had. So if you have a traditional long term rental policy but all of your guests only, you've only got people staying for two or three nights at a time that could undo some, some of the protections you thought you had with your policy. So yeah, I think it definitely is important that you're shopping policies that are specific to the exact strategy that you're using.
- [50:29]
A
Just a couple of things that I noticed when I, I went to a couple of these carriers and I got quotes from them that were stating like they're short term rental specific and I haven't compared them yet to my current policy. I literally just got these sent to me last night. But first of all, super easy process I will say but here's some things I already noticed that they, they include and I, I haven't looked at my other policy to even see if they include this but it's bedbug coverage, lost rents, squatter and which I would say lost rents is pretty common in any rental squatter and evictions, liquor liability, animal and pet liability and amenities like hot tubs and pools and then also assault and battery. So I, I was surprised at that one. I'm but the, the, the liquor liability. I did this post the other day about what's doing too much. Like I have one short term rental that I bring fresh flowers and put them in upon their arrival. Write a handwritten note and little drinks in the fridge and stuff. And someone said they leave a bottle of wine. And I've like heard such a mixed things about this as far as like, are you supplying the alcohol? This person goes and drives, gets a DWI and then they sue you because you overseer them. Like all of these liability things go into my head. And so like I asked one person, they're like, well, we don't rent to people under 18. And I was like, okay, well, or they must have been from Canada because the drinking age is 19 in Canada. And I. And then it's like, okay, well what if it's teenagers coming with their parents and they're, they, they drink and then their parents sue because the, the parents didn't see the alcohol and the, the kids got it or whatever. You know, they just like all these things go through my head. So like maybe that if you are supplying the wine and stuff that, you know, you do have that liquor liability in there too.
- [52:30]
B
I think it's better just to be as open and transparent with whoever you're talking to about insurance about everything your property offers so they can guide you in terms of what's the right coverage. Because what you don't want to do is hide something or say that you don't do something or you don't offer something and then God forbid something happens, you know, that wasn't disclosed and now you don't have the coverage that you thought you had. So transparency, sharing everything I think is the best path to get the right coverage for your property.
- [52:57]
A
Yeah, because what's the point of having insurance if you're not going to have the right coverage?
- [53:01]
B
Right.
- [53:02]
A
Like the point of getting insurance is so that if something happens at your property, they cover it. Like I looked at this campground to buy and during my due diligence I asked him to send me his insurance policy. His insurance policy did not cover any kind of heating that was like wood fueled or you know, like you had to have wood. They had almost probably like eight of the 10 cabins. There was wood burning stoves in the them. So like he wasn't even like honest with his insurance provider that there was, you know, and like hey, there's a fire. They not getting covered.
- [53:38]
B
So yeah, guys, insurance is one of those things just like, you know, obviously sometimes it can feel like you're, you're just kind of throwing money into the, into the void. But it's one of those things that when it, when it's needed, you know, you want to make sure you've got all the Right. Coverage.
- [53:52]
A
Okay, so then number nine, this kind of goes with the Google voice thing, but it's communication, boundaries and systems, but not only with your tenants, but with your vendors and with your, your partners or your team members. So, like, really defining how when tenants can contact you, what clarifies as an emergency? The most burnout I ever felt as a property manager was when I was 24 7. I allowed unlimited access to myself. No matter who called, I picked up that phone whether it was 3am, whether it was 11am or 11pm I can't even tell you how many times I get maintenance requests. Like at 1am in the morning. Just like somebody randomly thinks about, like, oh, this needed to be done. Like, not something that would be an emergency. It's just like they randomly decided to put in that their outlet isn't working at 1:00am and like, so. So which is fine now because it all goes through the property management software and is put into a work order. And I'm not getting an alert for it while I'm sleeping because it's not urgent and it's just going in there. So I think really defining, you know, for the vendors, the, your team members, your tenants, even your guests, I've had, I stayed at a property where they had the all in one washer and dryer. And we actually have this in one of our long term units. And we've had a couple of issues with it, but we haven't lately, knock on wood. But we were doing our laundry because we had been snowboarding and like, our clothes are kind of wet and stuff and we wanted to use them again the next day. So I set my alarm to like wake up at 3am to make sure I switch the laundry. So I get up. There's water everywhere in the laundry room. Everywhere. Like the thing is leaking water out of it. The door is locked. I can't even get our clothes out of it. I go to message the Airbnb host. It says, like, we are unavailable until 7am or something. Like they have an automated response thing that says from 11pm to 7am we are not available, please. And I can't remember exactly what it said. It might have said, please call if it's an emergency. Or I might have just went and found their number to call. I can't remember. But I called and I left a voicemail and they did not get back to me until 8am and they gave me the, like, the code to like, their little lockbox thing. And they had me like shut off the water and then reset the Washer and dryer and like do this thing that obviously this has happened before and they knew what to tell me to do, but it was like, I guess on the short term rental side, what is appropriate to like limit yourself as to how much August is messaging you and communicating you? Should there be a limit to it at all?
- [56:49]
B
It's a good question. It's something that we I think kind of go back and forth on, right. We also have in our messaging that hey, we're generally available between these hours. You know, if there's an emergency, feel free to contact us. But we do our best to answer as many guest questions as we can before they actually ask them. And then we do as as much work as we can to get them to review those answers to those questions they haven't asked yet before. They need them. So for us that means we have a really strong digital guidebook. It means we have really strong signage within the property to answer some of those common questions. So I'll give you like a recent example at the hotel. Again, we're, we're a self service, self check in hotel. So it's very much like an Airbnb. There's no front desk. Like you get there, you have your code, you punch the code, go into your unit. The keypads that we have, they don't light up by default. So like when you walk up to the keypad, all you know, say you're, you're going at nighttime. I think that's when this usually happens. You're going up to the keypad at nighttime. The lights on the keypad are off. A lot of people assume that you have to like press something first to get the lights to come on. And, and then you'd enter your code. And it kept happening where people were doing that. But in reality, if you press anything on the keypad, that's the keypad thinking that it's your code. So people would press a button to turn on the keypad and then enter in their, their four digit code and it wouldn't work. And they lock the lock. They couldn't get in. Now they're calling us late at night saying like, hey, I can't get in. You guys suck. So what we did was two things. We added a small light right above the door handle. So it was like a little like, like a solar light that would just like take in sun throughout the day. And then at nighttime it'll automatically kick on and just like shine light down onto the keypad. So now people can see immediately. And then we printed out this small little placard right above that light that says, read these instructions on how to unlock the door. And it has written instructions. And then there's a small QR code they can scan that takes them to a video in our guidebook that shows them how to unlock the door. So those two changes of putting the instructions right there in front of them, solving the issue of them not being able to see by adding the light now, we've significantly reduced the number of people who are calling us saying, hey, we can't get into our unit at nighttime. So I think for us it's understanding what is the issue that's, that's happening. Is it a one off or is it a trend? And if it's a trend, okay, what can we do from a management perspective to reduce the likelihood of that happening again? Sometimes it's just communication differences, sometimes it's communication plus physical changes. But I think if you iterate that over and over and over and over and over again, you've got a lot of opportunities to improve the efficiency of your property, whether it's short term, long term, midterm, or anything in between.
- [59:35]
A
Yeah. So basically what you're saying is like, it's not a availability communication issue, it's being proactive to solve the reason to communicate in general. Yeah, yeah.
- [59:47]
B
If we can just eliminate the need altogether, it's a win win because the guest never has to reach out to us, which means everything went smoothly. We don't have to worry about getting, you know, late night phone calls, people being locked out of their units.
- [59:57]
A
Tony, maybe I should hire you to eliminate any reason for someone to call me that.
- [60:02]
B
Actually, that'd be a good idea. You know, if we do an episode where we like go through Ashley's recent messages and see what we can do to improve it.
- [60:09]
A
Okay. So the last thing here we're going to go over is number 10, your plan. Plan for scaling beyond just being a DIY investor. And you know, I started out with that. I did a lot of stuff myself. I did the property management, I did the asset management, I did the deal finding, I did the payables, I did the bookkeeping. I, you know, did some of the rehab on some of my properties. So I think to me the most important thing to be able to scale is building systems and processes, which I know you guys hear that all the time. But I think the second biggest thing is having reserves in place and having capital. I think that plays a major role in being able to outsource things, automate things. Just that Sense of security that, okay, you're taking, you're letting go control of these things, you're letting somebody else do them. Whether, you know, it's a contractor doing the work or it's a bookkeeper stepping in is having that financial security that if something goes wrong, you're able to pay to have somebody to fix it, pay for whatever the mistake was or, you know, hire somebody else, or just like, you're able to take the time from whatever else you're focusing on because you, you can give up that little bit of money or whatever to be able to go and take that thing back on. So I think those are like, really the two big things is having that financial security to be able to grow and scale, having capital to put into deals and to not be so worried about, I don't have money. I need to figure out how to get creative as possible to. To be able to do these things. And then just building out the system and processes starting at day one, what are the things that I do every single day that somebody else could do for me? And even if you're. You don't want to outsource, there's things that I scaled back on that I was like, I don't actually need someone to do these things for me. These are things that I actually enjoy doing, and I want to be the person doing and. But still like building out. So whatever you can do to automate it more or to make it more efficient, like having checklists. We had somebody on Shelby before, and she talked about how she. Every time she does something, she creates a checklist. And with that checklist, she saves it, files it. If her or anybody on her team needs to do that same thing, whether it's just sending an email to a prospective client, she has a checklist for it. Here's what you do, here's what you say. Follow through. She never wants to think about doing the same thing twice. And I think that has really helped me to just like the acquisition of a property, I can move so much faster during that. And it's such a lighter lift for me than what it used to be because I didn't have a checklist with, okay, get the utility switch, get the insurance quit switch, make the tenant handbook. Start the, you know, get the property listed, all those things. And now it's just like, I can just knock out that checklist pretty quickly instead of like, oh, shoot, remembering now I have to do this. And then, you know, the next day remembering, oh, I have to do this. I can just sit down and go through that checklist. So I think those two things have really helped me scale beyond diy because I always was afraid and I had that mindset that if I do hire people, I'm not going to be able to, to pay that. I'm not going to bring in the income for that. So I think like having those reserves set aside that like my flip did not make the profit that I was thinking it would make. I would still have the money to pay my VA going forward.
- [64:00]
B
Yeah, I think, you know, when we talk about like scaling beyond diy, first there's two books that I think every real estate investors should read. Neither one of them are about real estate investing, but I think it applies. The first one is called the Checklist Manifesto. It's actually by a doctor, I think his name is Atul Gawande. And it just talks about how big of an impact simple checklists had on improving like really saving lives within hospitals, of just making sure that we're going through the same process every single time. The second book that you guys should read is called Clockwork by Mike Michalowitz who we've interviewed in the podcast a of couple of times. But he, he kind of takes the idea of the Checklist Manifesto but applies it to small business owners, which is what all of us are. So Checklist Manifesto, Clockwork gives you the framework on how to build out these super simple checklists and SOPs within your business. Now from, from a maybe theory perspective, there, there are two ways to build a business. The first way is top down where let's say that you, you raise a bunch of venture capital, all right, let's say you go out and you raise $5 million for someone to invest in, you know, Tony and Ashley's real estate venture. And we go out, we hire a COO, a CFO, a bunch of team members, and we've got $5 million like our starting pot of money to work with. And we built this entire team salaries and we've got like 12 months of, of, of of Runway before we run out of money. Right. That would be like a top down approach. Most people aren't building their real estate business that way. Most people are building it from the bottom up. Which means instead of going out and building a team from the very beginning, you are the team, you are everything. You are acquisitions, you are operations, you are finance and admin, you're hr, you're, you're all things marketing. So as you start to build your business, it's trying to identify, well, what is the highest and best use of my time. Where am I most effective? Where can I really drive the business forward and how can I try and do more of those things and less of the other things that I don't like to do that I'm not good at that aren't really driving the business forward and over time finding people to slide into those roles. And it doesn't necessarily have to be a full time employee. Property management, right? That's just you hiring a property manager to take on the management side. That's a big workload off of your shoulders if you choose not to do that. Hiring a part time virtual assistant from overseas who only works maybe 5 to 10 hours a week for you, it's a like minimal cost for a lot of free time back in your in your own calendar. So I think just having that approach of bottom up and trying to identify what are the things I should be focusing on versus things that I shouldn't be focusing on is how you laid the foundation for scaling well.
- [66:33]
A
Thank you guys so much for joining us for this episode of Real Estate Rookie. You can find us on YouTube @RealEstate Rookie. Or you can find us on Instagram at A Bigger Pockets Rookie. You can also find me, Ashley, at Wealth from Rentals on Instagram. And you can find Tony there at TonyJ. Robinson. Make sure to leave us a review if you're listening to this on your favorite podcast podcast platform. We'll see you guys next time. Thanks so much for joining us.