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How To Run A Rental Property And Keep Your Peace Of Mind

Fawziacademy.Com, scott todd from scott todd net land moto calm, most important they’ve got automating your craigslist in your facebook postings posting domination, calm, /the, landing scott Todd. How are you I’m great? How are you I’m great, I feel more calm, actually just being in Terry showers presence the mindful landlord all right.

Our guest today is Terry, shower she’s, a real estate coach he’s the mind the mindful landlord she has a phd, nothing to do with real estate, but she’s been managing half of managing rental properties. Half of her life, Terry shower, welcome to podcast. How are you thanks? So much for having me on I’m good, okay, look when people say property management, they immediately break on the sweat. It’s a headache: I’m getting a call two in the morning: the roof, the HVAC right, the laundry machine whatever it is, my Internet’s down.

Damn it Terry helped me now how on earth do you make this a mindful landlord type experience? Okay? Well, I think, there’s two things I mean, so I managed properties for my clients who I guess failed at their little experiment at mindfulness, because, like look rental property like we, you know all no passive income is really a good way to build wealth, long term, but Unfortunately, that comes with tenants and then you end up with the whole kind of aspect of providing service for them, and then you know either things fail, you’re working on a budget or sometimes you know.

If you get unlucky, you have some unreasonable demands at unreasonable time. So you know, as far as like you know, some of my clients end up calling me when they basically had enough of those kind of problems um. But I guess my goal with you know some of the bring out some of the mindfulness stuff on on how you can landlord is how you can bring a little bit more Zen into that whole process, because it can be like really frustrating and and can drive.

You, nuts, if you let it yeah, absolutely, let’s just kind of rewind the tape there and kind of tell us how you started what your PhD is in and how the heck you got into the landlording. So I actually I’m from Montreal in Canada and I moved to Toronto when I was 19 to study and luckily or unluckily. For me, there was no space in student residence, so I ended up in this. Like crazy coop house with no manager, the manager have actually left like a week before I got there.

So I came in there was garbage piling up. You know people weren’t cleaning, the bathrooms like it was just a total mess and they voted me house manager. Basically, within a couple of days of being there, and so that started me down this path of property management without me really knowing about it, and then you know kind of from one one, one step to the next like when I stopped studying in Toronto.

I I thought: okay, well, I’m kind of good at this. Let me rent a house and set this up. So as I moved on to do my PhD in Vancouver, I uh I rented a house and thought okay, I’m going to set this up. You know to help pay some of my school fees and then, after that I moved back to Montreal and thought okay. Well, I’ve been doing this now, for you know six seven years and now I’m ready to do it for profit and then borrowed a down payment for my first investment property and then kind of got on the same thing, and so one thing led to another.

It wasn’t like really uh, I didn’t have a master plan when I got into it. It was kind of the thing that I just like woke up one morning. It was like. Oh look, I I’m kind of good at this. I know how to do it and let’s do it full-time Wow, fantastic, fantastic. So what would you say is the word advise you here given in the landlording space? That’s a really good question. Um worst advice. I mean I think that, like in the real estate industry, very often people put pressure on others to you know acquire as much as they can with the best ROI possible and with the property management perspective like, I think what ends up happening is that people end Up closing on properties in sketchy parts of town or taking on either maintenance or tenancy issues that they’re not prepared for.

So I think that if you try to grow too fast or if you’re a little bit too aggressive by only looking at the numbers and not looking at the human and the physical side of things, I think that’s where I see like a lot of people. Kind of get tripped up so definitely that and then I mean the other thing not you know industry advice that, let’s say more landlord speaking to each other. Like you know, sometimes people will really sweat the small stuff, and I guess, like the number one tip of being mindful, is be able to prioritize between what’s small stuff and what’s not small stuff and your peace of mind is worth way more than a 5.

10, 15 bucks more in the bank so before you get really like worried and and bent out of shape over something just like get some perspective. Yes, it’s frustrating yes, people weren’t, respectful, but like what is this really costing me so maintaining perspective? I would say Scott. I know your thoughts. Oh, I have many thoughts like I like the idea. The thought of tenants does scare me like I don’t know I don’t want, like.

I seen nothing good from tenants at all. In fact, I had our. I had a rental home. You know that I, you know, and I had a rental home and it worked out. Ok, but at the same time like the tennis just seemed like they were a pain in the butt right like, like everything mark says like. Oh, this went wrong or that went wrong, I’m just like I don’t like I don’t like it, but it’s obviously, if you’re going to do homes or you know in that space, you’re going to have to deal with them, and so you, I think you do need To strategy, in order to do that, yeah I mean Terry.

What makes how do you sort of that a good tenant from a bad tenant, because you’ve been doing this long enough? You probably can just look at somebody like now here pass, that’s a great question and it’s one that you know as I’m kind of coaching people like into starting out as investors. I really feel like you, can’t overstate the importance of choosing your tenants carefully, because you’re really choosing your quality of life.

When you let someone into one of your units – and I don’t know you know it’s not the same really across all markets, but I know that you know here in Montreal, like there’s kind of this old-school mentality of like let’s just settle on a handshake and people Kind of don’t always do their due diligence, and so my recommendation would be really you know. Take the time fill out a proper application. If I can look at just one data point, I like to look at at credit history, because I find that you know independent of like references from employers or previous landlords or whatever it is like.

Those are important data points, but the credit is really just going to give me a neutral look at how that person is handling their responsibilities, and you know I see people who ruined their credit for, like you know, a two hundred dollar collections bill from a cell Phone company and when I see that it’s basically telling me like how is this person handling their affairs and, if they’re willing to ruin their credit for 200 bucks, you know for a cell phone bill, they didn’t take care of.

What’s it going to be like when they’re in one of my units or one of my clients units? So I really like I really like the the credit score kind of as a as a data point, and then the other thing is that, as I’m going through the application process, I really treat that like a little bit like dating. You know that the person from a human point of view is going to be trying to show you their best foot forward and if somehow, that process isn’t seamless, if they’re, not returning phone calls, if they’re trying to negotiate weird things or like being unreliable, even in The application process once they’re in my unit, it’s not going to get any better, so I would say, like those two things, definitely like how they’re, how they’re humanly like handling the application process and then just a hard data of a credit score, yeah yeah.

Absolutely it’s got Todd you’re kind of shaking your head. Okay, so look I I agree. The credit score is a big thing. How would you handle this situation right? Like I’m going to go, run someone I tell somebody, listen, I’m going to run your credit credit check. He’s like whoa whoa hold on hold on where you go. Do that? Can I please provide you with a copy of my credit report and the reason is because I had a bankruptcy a two years ago from my business failing I had a bankruptcy and every time you pull credit, it lowers my score and I’m trying to get my Score back up, what would you say you re shaking your head? No, but like it sounds like you, I know know so.

Actually that’s actually a good question. Um there are many third-party sites, so the way credit works is that if someone else is pulling your credit score, it will affect it in a negative way. But if you pull your own credit score, it’s actually not going to affect it right. That’s what he was saying: that’s what you’re saying there’s no way I’m going to let someone else provide me even less with a paper copy of their credit score, because then you know with with Photoshop now like anybody can do anything, but there exists for this third-party Sites that allow the person to order their own credit, therefore not affecting it and share it to you on the third-party site.

So actually, on my, I wrote a blog article about this a little while ago, with a link on my website to one of those specific agencies. That does that and when I have people who like give me that kind of excuse, I’m like okay and you know, actually actually explain to people in the application process. If we run your credit, it’s going to dock you a couple points, so you can pay for your own credit score and share it with us and we’re totally okay with that.

So that’s I’m a good solution to that kind of weird answer and then, if the guys like falsified his own credit score wall and he’s just going to disappear on us all, right, okay, so so now that now that I get his credit score right, what’s the Magic number, because I’m looking at the credit score the guy filed bankruptcy. Does that mean he’s a deadbeat should be house or am I looking for the back bit? Okay, he owns his own companies.

He’s got some money coming in. I can see it. I can see the money, or am I only looking at the credit score and if so, what’s the magic number you know, um I’ll tell you, we’ve had this situation come up. A couple times obviously depends how competitive the rental market is like. If I have ten people to choose from, and mr. Bankruptcy is number nine sorry, but I’m going to go with the best person who’s on the list, if it’s a unit for which there’s less competition and like I’ve had this actually happened twice that somebody who has A bankruptcy that showed up on their credit score, and you know if I have a choice between somebody who ruined their credit for 200 bucks to a cellphone company and somebody who had you know whatever a two hundred thousand dollar bankruptcy, because they had a problem in Business, I’d almost rather deal with the person who had a big problem because, first of all they were credit worthy at one point and then in that, in that kind of case, like look, if he’s the only person – and I haven’t had another application for a month – I’r going to then look at the other data points which would be like you know, previous owner on his current employment history and then also you can get.

You can get a cosigner. So if you have somebody else who’s on the hook and usually someone who’s like not in an awesome credit situation, they will be able to provide you with someone else who’s going to like guarantee lease, and in that case, if they have payment problems, I have someone With solid credit that I can go after so gotcha, gotcha, okay, good, very good, so Terry is there something that you believe is normal or wise or cool that other people will think is just absolutely crazy to see like in general or in landlord landlord in general.

Have super crazy views on things? Generally, I don’t know I mean maybe one of the unusual views in unusual ways of looking at things. It’s like I’m a big fan of of incremental progress, and I think that the world right now does a really big disservice. With this whole idea of overnight success – and I think that applies to investing obviously like you know, I have a sports background as well and when I look at you know the sort of the talent myth where people are kind of saying that off you.

You know you’re not the best rookie yet whatever or if you don’t. You know, do a hundred deals in your first year, your first two years or just give it up. There’s no point, I think, that’s really a big kind of a big, a big lie and it’s it’s a disservice to people. So you know and I’m really a big fan of incremental learning and I feel like that’s, not necessarily super fashionable right now. But if I had to pick a wild and crazy for you, I don’t know such a well crazy.

I love it so if I was going to get into landlording or Scott was going to get in the landlording and we can leave one book to read prior to going into it, which book would you recommend, of course, landlord coming out on June 1st? And so I would say: half the book is really the nuts and bolts of you know managing tenants and handling property issues, and then the other half is about mindset, so be it from overcoming the fear that stops a lot of people from getting into investing too.

Then, after once, you start succeeding knowing when enough is enough, I think those are some kind of issues that often in other investing materials they kind of get left to the wayside. So that’s what I would recommend: okay, great great, all right. So what? What is your tips to help someone who’s, having fears overcome them like to just the good deal? What’s your tips, what’s your process? Well, I, but I think the first thing is to take a deep breath and realize that we’re all here for a limited time and that, whatever fear you have be it fear of looking stupid or fear of not knowing your finance, math or fear of you know.

Going out and talking to people whatever it is, you know when you put that in the perspective of the fact that you only have one chance at this, so just you know turns going to sound like a Nike commercial, but just do it. You know you got to just realize and there’s actually one chapter on this in in mindful landlord. So if I had to give one tip, that’s what it would be, of course I could talk for much longer about it, but yeah yeah.

I I have it. I have the same philosophy by the way I I feel like every every moment so precious like do you? Are you really your ruin your day, because one of the seven billion people on earth said something that upset you like seriously yeah, that’s funny! It’s fine because you know. Ultimately, I think that what happens is there’s a lot of people that, like what you said like. Are you fearful of what someone might think of what you said and what it’s so funny? Because you know, like you, go through your life and you worry about what other people think or remember, and you know what the reality is.

They don’t remember anything because they’re so focused on themselves and their own lives. They they really don’t care about you. I don’t hate mean that I mean we care about you, but, like honestly, people don’t care about you like they don’t care like it’s over with it’s done. It’s forgotten it and moved on with their life, because guess what they got to worry about, what they’re going to eat for dinner tonight or whatever.

So I I do like. I think that whatever you’re struggling with just freaking go, do it because then you know, you said that you could say I did it man as opposed to oh. I surely wish I would have done this when I was younger. No just go. Do it now have fun with it and if you fail, who cares fail? Big Terry will still rent you a place. Yeah don’t fail over a cell phone bill. Ah yeah I mean Terry. Can we get geeky for a second yeah? All right is there a way? Do you automate collecting your rental payments? You use any kind of property management software that you recommend.

How do you actually manage the day-to-day of this yeah, so we’ve been using a property management software, for I guess three, four years before that we kind of tried to do everything with Excel and Google Docs, and I mean I don’t know I feel like there’s been Such a big explosion in the kind of software technologies that are available to us, I think by all means it’s a great time-saver um. We use the software called uh bill diem, which of what’s out there I found for.

What’s you know available at what price I found it? It’s a pretty good, you know the value for your money is pretty decent and it has like for property managers. These great functions of the tenants have a portal so when they have a maintenance request, they can just snap some photos of like the toilet or the faucet. That’s leaking put in the request and then I can just forward it to whatever maintenance person is necessary.

So that saves us all kinds of time and you know the it also allows you to email people, there’s an app that’s connected to the phone, so you’re. Never without a phone number like it’s just, I don’t even know how we worked before before having a a decent software. As far as like automating the other stuff, I was actually talking to another investor, who has his whole application process like streamlined and and and you know, his application form is online and then it like automatically pulls the credit and then he’s actually got another app.

And I’m not going to remember the name of the app, but it like integrates all the other apps. So, for example, when you really receive a credit score, it’s then going to say: okay, you now need to put that in this Dropbox and you know, email this person and this person this person. I think it’s called zapier. Actually, that’s the name of the app, and so this is a peer most technology like cutting edge on technology, but like I’m, definitely going to start looking into that, because if you can map your workflows once then you kind of go through and you’re just saving.

So much time – and you know, the other thing is like now – that we have all these tools and these apps that do individual tasks for us. The real challenge is: how do you get them talking to each other, and you end up then, being the interface between all these apps that if there was just a way to like mastermind the apps, then you could really automate everything. So I fantastic fantastic Scott Todd.

Any any final question: before we go to our tip of the week, I don’t think so mark. I think this is good and say: Pierre Manu Trudy doesn’t love that website. I know what’s very good she’s going to be like this is nutty, and why haven’t I been doing this all the time? Can I streamline the whole maintenance headache process just giving my tenant, you know say: look I’ve got a home warranty here. Here’s the number of the company when they come out you just pay 50 bucks and they’ll come and fix it.

Like don’t bother me with it, it’s on you I mean if you have like a real. I don’t know what kind of what kind of guarantees like you know, what’s a new constructions here in in Quebec, when you purchase something like a new property, I think there’s either like a five or a ten year guarantee on stuff, so for sure like. If you can, whatever I feel like, whenever you can empower tenants to like handle anything themselves, you should do it and they’re actually going to be happy about that, like we do that, actually with some of the units that we manage in condo properties.

So if I can put the tenant directly in in contact with the person who’s in the condo association, who’s, taking care of maintenance as long as they’re, not like incurring expenses to my client as they want to like by all means, I try to empower them as Much as possible and then like the manager or the owner, you cease being the bottleneck for the solution and their frustration gets directed at the person who deserves the frustration, so be it, the internet provider or the guy who didn’t cut the lawn or whatever.

It is. If they can directly communicate their frustration to them, that’s just frustration. That’s not falling on you! So by all means yeah delegate all right great! Well, I I feel a lot calmer about the idea of the landlording about you, Scott. I’r ready to try it not really, but I’ll give it a try. Really. I yeah I mean I think you got to have a certain personality like I just lit some incense and I’ve got some some some tantric music play in the background.

I still feel very anxious about the idea of a tenant remark. I mean I guess I mean like that. Look. I know that we we put a lot of strain on it and a lot of drain drain and strain. You know, like stress, strains all this other stuff, because there are people that do it. There are people that hate it, but there are people that haven’t figured out right, like you know like what you just said with the home warranty.

That’s like that’s a great little hack. There listen, there’s a home warranty. You know you’re responsible for any deductibles that take place because it’s it’s on your read now. If they know that going in well, then that’s the way that it is and they’ve agreed to that and and so be it. You know, I think if you try to change it downstream, whatever I know that there’s people that have run rental homes were like listen.

I never ever ever have to deal my tenant at all, because I use a realtor to do it and the realtor collects everything and the realtor handles all the maintenance and all the other stuff great I mean I’m sure, that’s a great way of doing it. Obviously, there’s a cost component associated that I think, like 10 % okay, so you know if, if that’s a concern of yours, I know there’s ways to shortcut it. I do like that little niche out there, where you can have kind of the same thing, but never any tenants or toilets or termites, and if there’s some way you could just I don’t know, sell land vacant.

Land that’d be great yeah. But thank goodness there are people like Terry shower that love it teach it and you know cuz Ron lands not for everybody, and I think this is really a valuable resource for a lot of people, so good on you, Terry, but we are at that point now, Where we’re, at our tip of the week a website a resource, a book, something else actionable where the our passive income listeners go, you improve their businesses, improve their lives.

What have you got? Okay, so I would say for my tip of the week a little bit of something is better than a lot of nothing. So if you’re ever sitting there and thinking you know, I don’t have time to run 5k or I don’t have time to learn this piece of real estate knowledge. I don’t have time to read this book: do whatever you can and if those little five-minute things that you do will add up, and they will put you further ahead over a long period of time than if you do nothing so that for sure and I preach In the choir here and there’s, actually, my favorite book on this topic is called incremental change and that, I think, encapsulates really.

This idea very nicely that if you work at something consistently like let’s say, you need a hundred calories less a day, you’re, not even going to necessarily feel that pinch. But the pounds are going to add up over time. And if you make the mistake of doing the opposite choice and eat an extra hundred calories a day, you’re going to see the negative effects of that as well. And I think that applies for sure to investing or to any kind of, like you know, financial or learning endeavor in the same way, fantastic yeah, one of my newest favorite books is atomic habits by James, clear.

It’s kind of a similar idea that just is 1 % an incremental improvement. Your habits will will make such a huge difference in the long term. A Scott Todd, what’s your tip of the week, well just uh just to build on that. Just one last thought on that piece is that I actually had a boss once who told me I never have to like be a rock star. I just have to be 1 % better than anybody that I’m going against, so just 1 % better wins the race.

That’s all it is right, but mark my my tip of the week for you it’s for you is for other people too, but I’m sure that you’ll love. This is what, if there was an equation that that was like a miracle made all of your decision, makings and goals possible, like wouldn’t that be cool if there was an equation. Yes, so check out this book you’re going to love it the miracle equation by Hal Elrod. Yes, you know the guy.

You love the guy mark. I do that a new book that you can go by right now and start with your miracle equation. Whoa the two decisions that may be your biggest goals are possible: the probable to inevitable. I love it holy there’s. So many good books out there right now. Aren’t there yeah yeah it’s a struggle to find the time to read as much as we could be yeah. It really is Wow all right done and done well, my tip of the week is learn more about Terry shower and the mindful landlord at, of course, Terry shower calm.

Nobody can spell it. So don’t worry about it. I’r going to have a link to it in the show notes, and you just click on the link and go to her site. Also, I just want to remind everybody. Today’s podcast is sponsored by flight school, learn more just go to lanky com4, slash training, start executing with the land geek Sherpa himself, Scott Todd in real time and flight school live get her done in three days.

Where you start mailing, you start marketing, you might even sell a property in three days, learn more the lanky calm, full slash training. Also, if you’re getting value from this podcast help us out, send it to a friend email to a friend, throw it out there on social media. I’r loving this podcast, I’m learning so much. Also, the three things you can really do to help us is simply subscribe rate and review.

The podcasts send us a screenshot of that review to support at the lankey calm we’re going to send you for free the $ 97 passive income launch kit. Terry shower. Are we good? Yes, thank you. Thank you, Scott. Are we good we’re good mark? Alright, you ready to do this. Yeah go to 3. Will freedom ring thanks, everybody Terry’s, like part geeky, we said we said that we would alternate, but we didn’t say who’s going to go first.

So that is true. That is true, hey, better! Alright, thanks, everybody


 

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