Hey, it’s Sam here! Over the past few years and months, I’ve witnessed ALOT of landlords throw their towel in and call it quits on their rental property. You may already be a landlord or you’re thinking of being one. I’m going to throw down some truths about being a landlord and also explain why landlords quit. I can tell you right away that most landlords quit because they didn’t have their business set correctly and that they were running an inefficient show. I’ll get into some more reasons as to why landlords quit and how you can make it a pleasant experience in your career.
Owning rental properties is one of the BEST, if not, the only true way to help you become financially independent without investing much of your time. However, most investors and landlords get into the business only to run the other way.Why is it so? Why do they abandon their ways? Becoming a landlord should not cost you an arm and a leg. Afterall, you should be enjoying the time freedom and not having to worry about the tenant issues.
1. Poor Management or Lack there of
Most landlords that I meet that quit have one thing in common. Poor or no management. There’s a misconception out there that property managers are EXPENSIVE. Well, I can tell you that the industry standard is 10% of your gross rent. For the tenth of your gross rent, your property manager can take care most of the maintenance, collecting the rent, and getting a tenant into your property. Most competent property managers can take almost all of your burdens of having to take care of the property. Why not leverage the time, effort and the energy of other individuals or a group to give you more time? At the 10% cost, you’ll actually save a lot more headache. Now, if your property manager is the source of the problem, then simply make a switch to a better one. There’s now rule that says you have to stick with one manager at a time. Is it reasonable for you to believe that there are bad doctors and good doctors out there? Then it’s also reasonable to believe that there are good and bad managers. You just have to find the good ones.
2. Improper Expectations
Now like many things, there is no such as “no work, 100% gain”. In fact, you’ll initially have to do alot of work to get the property set up, get the deal done and set the business up properly. Yes, you’ll have to invest couple hours every week to manage your managers depending on your level but it’s not gruesome as a 40-60 hour workweek. In fact, with the right management team, you probably won’t have to put in more than 5 hours a month. Of course you’d have to build your business to that level. Nothing will come easy in the real estate business. There will be countless of hours of learning, education, reading and attending seminars to perfect the business. It’s up to you to dedicate your life and commit to excellence in the business. I’ve met WAY TOO MANY half-hearted landlords that have a day-job and they’re struggling with the rental properties. If you’re going to be a landlord, commit to learning more and improving your business. It’ll definitely pay off with more time freedom and financial independence.
3. It’s DEFINITELY not for Weak-Hearted
Being a landlord definitely takes guts and thick-skin. It’s definitely a people business and you’re going to deal with a lot of interesting individuals. If you tend to be reserved and not quite assertive, then perhaps landlording may not be your best fit. It may be a better idea to be a partner to someone who can compensate for your weaknesses. There’s nothing wrong with being “think-skinned”. You may have other strengths that you can bring to the table to add value to the business. You just have to understand who you are and what skill sets you bring.
4. Not enough Education
This sums up my points one through three… Not getting education really sums up my points here. If you are lacking knowledge in how to effectively run your rental properties, it’s going to cost you both time and money to keep running your rental business the way you are. Getting educated is going to help you unlock some new tools and leverage that’s going to save you ton of time and hassle. If you don’t want to invest $1k, $5k, $20k or even $40k into education and learning, you don’t really have a business. That’s called a hobby. And when you run anything like a hobby, it’ll pay you like a hobby. It’s time to get serious and pick up some new tools and innovate yourself around potential challenges along the way!