On self-management and its challenges - a confused teacher

#יםמהשבוי Yona Shuman #Post3

In our company, I am responsible, among other things, for the field of self-management of our portfolio and also for training others for self-management.

In this post I will give some general tips on how to start managing assets yourself and what to pay attention to in self-management of assets.

First of all, I highly recommend managing the properties using property management software that makes the process very easy. There are many property management software, but due to the brevity of the paper I will refer to 2:

At our company we manage our portfolio using the Hemlane software, although the software is not free ($34 base + $15 per asset) but we found that it has many advantages that are worth the payment. For example:

- When you want to advertise the property for rent, the software advertises it on all the selling websites directly.

- As part of the screening process that is performed for a new tenant, the software interfaces with TransUnion to perform a background check on the history of evictions and other general information on the financial situation, including credit score.

The software obliges the tenant to pay full payment of the monthly rent and blocks the option of partial rent payment, since partial rent payment adds difficulties to the eviction procedure.

-Communication between us and the tenant goes through Hamline's human customer service which is available to the tenant 24/7, and there is an option for the customer service to handle the contact directly with the professionals I define in the system for repairs. Of course, I can also set an amount above which they should contact me for approval.

-You receive a subscription to the RocketLawyer website where drafts of contracts for each subject and customized for each state with an option to automatically fill in the data in the contracts. 

There are also free property management software such as TurboTenant that can also be used, but we really like the human customer service at Hamline and the automation of the service calls and it is worth the monthly payment to us. 

Another thing that is important to focus on in regards to self-management of properties is the relationship and dealings with the tenants.

On the one hand, we want good relations with the tenants and for them to be satisfied (and it's also fun to be nice) and on the other hand, experience has taught us that the more friendly we are with the tenants and respond to their demands even in matters that go beyond routine maintenance, the more service calls we will receive. In the end we run a rental business, the margins are not large and the properties must be managed precisely.

Therefore, in our company as a rule, communication with the tenants in matters of service calls is done exclusively by opening a service call with the management software, the response to the call is done through the management software and we make sure to respond quickly and optimally to service calls that are our responsibility as landlords and politely refuse other service calls.

You'd be surprised what tenant service calls will open up if you make them feel too comfortable. For example, we received a service call about spider webs in the property and the tenants politely responded that it was not our responsibility and that it was recommended to simply clean them. Another call we received was a request to replace all the sockets in the house with new sockets, even though the electrical system is in order and thus the property was rented.

Another thing that is important to note is payment deadlines. Our recommendation is to be very strict about payment deadlines. If a tenant is late for a few days, make sure to charge him the penalty stipulated in the rental agreement for being late. When a tenant does not pay and does not communicate with you about it, our recommendation is to contact the tenant and ask if there is any problem with the payments this month and if there is no response, stick a notice on the tenant's door before filing an eviction claim. In this context, I will tell you about a property we purchased at a bargain price with a tenant, which we knew was problematic. The first of the month arrived and the tenant was in no hurry to pay. To the message we sent him, he answered with curses and heaping up difficulties. The next day, an eviction notice was posted on his door, and the same day the rent was transferred to us. It is very important to treat the matter as a business. If you start giving tenants frequent extensions without penalty they will see it as a habit. If you are very clear that you are not late, you will receive the rent in full and on time.

Another tip is to take care of a rental agreement as detailed as possible and of course with at least one month's deposit. You will be surprised to find out how many events will meet you during the rental period and a relevant clause in your favor really helps in such situations.

In conclusion, I really recommend jumping into the water, learning how to manage on your own and get going, when you know what to do, the 'demon' is not bad at all and gives you complete control over the business and the ability to grow the business to the next level.

In the picture: properties that came under our ownership recently