Doing on site property inspections.
I find that holidays are a good time to do inspections of the properties since you get a real look at how things REALLY go when all of the residents are around. Plus it keeps my property managers on their toes.
Property Inspection Revealed
Well, on this particular Memorial Day I inspected one of our 40+ unit properties and found the conditions of the common areas to be subpar. The common areas being in great shape is key to having a good first impression on a potential tenant and of course helps with the current tenant mix keeping the tenants in their apartments as long as possible.
Bottom line is clean common areas help reduce turnover.
So, this 40 unit common area was not nearly as good as it needed to be.
Not even close.
So, the very next day I gave our management folks direction on what needed to be done and that it needed to be done right away. That was on May 27th.
Well, late Friday afternoon on June 27, almost a month later, I go back to the property to see how the clean up of the common areas went. What did I find?
Nothing had been done! That is what I found! I found that the common areas were in the same shape as they were a month ago.
Saying that my blood was starting to boil at this time is a huge understatement. Heck, I get mad just thinking about it now!
When my money and investment is in this property (and the money and investment of my investment partners too) it gets me in a very foul mood.
Yeah, the property does fine cash flow wise under the existing conditions – BUT – it could do so much better if what I told the management folks to do would actually be done. When I said it needed to be done!
Now I know that this is not Utopia where everything always goes just wonderful I mean we are talking about dealing with people. And..
The majority of the time the management folks do a great job, they really do.
But do you see why I make it a point to inspect all of our investment properties often!
In order to maximize your investment you simply have to. My cash flow and net worth and my partner’s cash flow and net worth depend on it. And then things do not get done like they should my blood does boil.
One mistake I see a lot of investors make is they don’t inspect what they expect. I know that this is an overused term but this is not just with real estate but really with all investments.
But in the world of real estate, oddly enough, this is exactly what makes us a lot of money!
Think about it.
What if the 40 unit property I just talked about was owned by an investor that did not do any kind of inspecting? How about any kind of inspecting for a number of years?
What kind of shape would the property be in say three years from now under this scenario?
Sure, good location, low rents due to condition, crappy tenants and in the kind of condition that would turn
Is ACTUALLY exactly what we want as investors.
I have talked to you many times about these properties But this is exactly, once we own a property, want to avoid too.
Check out my video on REIClub.com: How Often To Inspect Apartment Property AFTER You Own It