Everyone has heard the saying, time is money. You’re not exactly cash strapped, but you are time strapped. So how do you increase your investment in real estate when you’re short on time?
When you’re investing in real estate, time really is money. You are always up against the clock. The day you close on an investment property until the day you are ready to sell it, or rent it- the time in between is crucial. As you are building up your real estate portfolio, you will need to quickly find ways to help you get things done. But you know you can’t be in multiple places at once. So how does the busy investor, with little time, continue to invest?
One possibility is to participate in a crowdfunding campaign. However, if you do this, you have no control of the process of the investments. You enjoy the hands-on aspect of real estate investing, so we’ll save that topic for someone else.
We’ve done some research to find you some tips on how an investor with no time can get it all done. The tips that we are sharing below will allow you to ramp up your activity while still being active with the investments.
Here are 5 ways a busy person can invest.
1. Utilize Online Capabilities
Don’t waste time driving all over town unnecessarily meeting prospective or current tenants to deliver or pick up forms. This is the 21st Century. Have your forms such as tenant applications online. Have PDFs readily available to download or capable of sending as an email attachment.
Create an email account where tenants can email a maintenance service or repair request.
Set up a business account with PayPal so you can receive deposits and rent. This will save you from running to a P.O. Box to pick up rent via cash or checks, and it will also save you another trip to the bank to deposit your funds.
2. Carefully Screen Tenants
Nothing is more time consuming than having tenant turnover. Imagine having several apartment buildings. Imagine having let’s say around 4-8 rental units in each building. Then imagine always having a couple of vacancies. What’s missing? Rent payments! You as an investor need to make your monthly mortgage or installment payment on the building whether it’s fully occupied or not. If you have high tenant turnover- you are in a vicious circle of moving the wrong people out and getting the right people in.
Make sure you are carefully screening your tenants. This will save you a lot of time and energy in the long run. If you don’t do the necessary background, credit or reference checks up front you may find yourself having to deal with tenant turnover.
3. Leverage a Property Manager
If you have multiple properties located in different parts of town, hiring a property manager will save you tons of time that would be spent driving to and from them for whatever needs arise. Here are just a handful of ways a property manager or property management company can help you save time.
A property manager can help you with marketing your properties, especially your vacancies. They can handle all of the showings. Saving you time from running all over and scheduling appointments for new tenants to do walkthroughs.
Need to evict a problem tenant for slow pay or no pay on rent? Handling an eviction requires paperwork to be filed with the court system. Sometimes you may have to have the belongings removed from the unit. Then there’s the task of cleaning the unit out and performing the necessary preparations of getting the unit ready for a new tenant. A property manager or property management company can handle all of these details.
Do any of your tenants have problems with other tenants? A property manager can help manage these conflicts for you.
They will also help you handle maintenance and repair issues. They can handle calling contractors for needs such as HVAC, plumbing or even locksmiths. Can you imagine having over 20 properties and or units and trying to respond to all of these potential service requests yourself? That’s enough work for a full-time maintenance person. Don’t spend your time on the phone calling around for the best quote and scheduling appointments to get access to a unit. Let your property manager take care of this so you can spend your time on investing- doing activities that will help you put more of a return in your pocket.
4. Acquire Newer Properties
If you have the resources acquire some newer properties- this can help you save time. How would you do that and still have it be a profitable investment? Here are some examples of how you can find a motivated seller. Look for someone that needs to get out of their property fast. This could be a person that just received a job transfer. Couples going through a divorce sometime want to sell quickly so they can split up assets. Sometimes people receive property as an inheritance. They don’t live in the area and they just wish to sell it.
Whatever the reason is- if it is a newer property, it will not have as many issues as older properties naturally accrue. There won’t be as many repairs and maintenance requests to respond to.
5. Use a Professional to do Inspections
When you are looking to acquire a new property, one thing you will always want to do is have an inspection done. You don’t even need to be a real estate investor to know or remember when you bought your own personal property, you had an inspection done. Do you remember how time consuming it was? If it’s a good home inspector and they do a thorough inspection, it can take 3-4 hours! And that’s per property. Imagine if your goal is to acquire let’s say 5 properties per year. That’s 5 inspections times at least 3 hours per property. That’s 15 hours! If you are using a realtor to represent you as the buyer- let them coordinate the appointment with the home inspector. Let them stay and walk through the property and work with the inspector. While they are doing that- you can once again use your valuable time into some profit generating activities.
In closing, keep in mind that not all of these tips may work for you or your budget. If you’re just starting out, it’s good to try to do some of these things yourself. It’s a great way to learn the process. That way when you start to become more successful, and have the funds available you’ll know which areas make sense to hire someone to help you, because time is money.