Landlording Is A Team Sport

Back when I started as a landlord, I had no idea what I was doing.  My brother was my partner and was a general contractor so, he handled all of the maintenance responsibilities.   I had to learn how to market our vacancies, process applications, price the rents, account for the income and expenses, and most importantly, have good customer service to our clients, the tenants.  When my brother became injured and could no longer work in the family business, I needed to learn the importance of an excellent team to call upon when needed.  I quickly learned that landlording is similar to a team sport.

For clarification, a team member does not necessarily mean an employee.  These are tradesmen, legal counsel, bank/loan companies, real estate professionals, CPAs, cleaning companies, appliance repairpersons, landscapers, etc.  Essentially, a team member is ANYONE who can make your life easier by completing the tasks they know and do best.

Our Top Five Team Members

Choosing the five most critical team members is like only picking two of my three children to go in a lifeboat.  Where Kevin and I can handle many jobs, every person on our team is crucial to our success.

Maintenance

We have our general contractor on speed dial.  We were lucky enough to find a contractor that does not do large projects.  He worked for years on large jobs and, as he has gotten a bit older, decided that smaller jobs have fewer headaches and likely more income for him. In addition, he lives in the same area of our units (we live 2 hours from our rental properties), so he can quickly head over when a maintenance issue arises.

He does not mind being on call when we are on vacation, and he is very protective of our properties.  He is insured and bonded because he is a licensed contractor, so we have no trust concerns with him being in occupied units.  For the most part, he will do almost anything except new electrical.  For that, we hire his electrician.

How did we meet him?  He was referred to us by the painter.  You will find that referrals are the easiest way to secure a team member, so do not be shy about asking fellow landlords for direction when in need.

Legal Counsel

As a landlord, we cannot express enough the importance of an excellent real estate lawyer.  We have called upon our real estate attorney multiple times for clarification on landlord/tenant law.  Additionally, he has assisted us with lease writing, evictions, everything from setting up an LLC to legal communication with unhappy neighbors and note structure for private lending.

How did we meet our lawyer? Our CPA referred him.  If you are unsure where to start, try joining a local rental property group, Bigger Pockets landlord forum, AAOA, or a local or state association for rental property owners. For example, in California, we are members of CAA, the California Apartment Association.  An annual membership awards us with endless webinars, free legal advice, California-approved leases, addendums, and notices to use for our tenants as laws change (hello, pandemic), as well as political background on upcoming bills.

A Tax Advisor or CPA who specialized in real estate investments

We could not talk about the importance of a good team without including the ever-important CPA.  Our tax guru makes sure we are setting the business up to take advantage of deductions and structure our income so that our tax liability is as little as possible. In addition, he reviews our bookkeeping to make sure we are processing everything correctly and advises us when it is time to start looking for additional investment opportunities.  In the sport of landlording, this is one team member we could not do without.

There are many not-so-great advisors out there.  If possible, try to find a referral from someone you know.  Interview them and ask questions you may know or be familiar with the answers so you can judge if his answers are helpful or not.  Questions like:

How should we account for mileage, travel, and meals when visiting our properties?

Should we bring on family members as employees?  What are the tax benefits to this?   For more information on this subject, check out our blog Make It A Family Affair, How Landlords Can Employ Children For Tax Breaks

What is the best way to depreciate our property?  In case you did not know, there are a few options here.

How should we account for security deposits and cash reserves?

Should we have payroll? If so, how do you file Federal and State payroll taxes?

What bookkeeping software do they recommend?

When it comes to inquiries for your tax preparer, there are no silly questions.  If you do your bookkeeping correctly for your business right upfront, it will save you both time (and money) in the long run.

A Solid Cleaning Crew

I cannot stress this one enough.  Having a clean, vacant unit can mean the difference between getting it leased or not.  We want our units spotless.  Often, we are complimented on how clean they are as potential applicants view them.  This cleanliness shows pride in our rental properties.  When others see how clean we offer our units for them to move into, they realize we respect our relationship with our tenants.   First impressions are essential to new clients in any business.

It took us a few tries to find a good one.  One who will open the kitchen cabinets, wipe down all the shelves, remove shelves from the refrigerator, wipe the whole interior down, clean blinds,  clean behind the washer and dryer, and dust the ceiling fan blades.  They use different, clean towels when moving from the bathroom to the kitchen.  Yes, this is an issue!  For best results, create a master list of what you want to be cleaned in every unit, from windows, closet and shower door tracks, to oiling wood kitchen cabinet doors.  Share this list with the person pricing out the job so they can determine how many cleaners to include on the crew, how long the job will take, and what cleaning solutions will be needed.

We discovered our cleaning company when a tenant hired them for a move-out cleaning.  We were seriously impressed with their job and gave them a try the next time we had a vacancy. But, be prepared that you get what you pay for.  If the price seems too good to be true, it probably is.

Appliance Repairman

Okay, this may seem odd, but the more units you have, the more appliances you have.  Which, in turn, will mean you will have a greater need for an appliance repairman.  Usually, these guys are expensive as heck and are hard to get to the unit promptly. So here are some tips when looking for an excellent company to work with:

Find a company with several repairmen.  One person shows mean you will be waiting a while for them to show and evaluate the repair.  There’s nothing worse than waiting two weeks to find the appliance is more economical to replace than repair.

This leads me to my next tip, find an honest company that will tell you when it is better to replace than repair.   A dear friend of ours is an appliance repairman who has informed us that, if the repairman is reputable, they should evaluate more than just the problem at hand.  They will notice corrosion or sounds that will likely mean more repairs in the future.  You don’t want to work with a company that sees you as an opportunity for more repairs.  Good repairmen have more work than they know what to do with and are happy to take the service call fee and move onto their next call if the appliance warrants replacement.

Find a company that services several brands.  Often landlords will put the least expensive appliance they can find in a unit.  Unfortunately, getting that off-brand refrigerator compressor replaced may be more difficult than expected.  We understand that many landlords prefer to toss out the old one for a shiny new unit, but usually, for $300, you can repair an appliance and save your bottom of the line 50% of the expense of purchasing new.  Not to mention keeping one less machine out of the landfill.

Knowing the importance of a good team, we try to complete tasks ourselves before calling on our team members.  We are acutely aware of our bottom line, our cash reserves, and our schedule.  When time allows it, we will paint, clean, and repair our units.  When we can make better use of our time elsewhere, we leave the work to the professionals.  Can you see now how landlording is a team sport?

Don’t miss out! To join our mailing list and be the first to know about our new releases of articles or courses, sign up here.

Here are some other articles we have written for landlords that you may find helpful as well:

Offering Tenants Incentives Upon Lease Renewal

The Who, What, When, and Why of Residential Vacancy Insurance

Cash Reserves For Rental Properties, How Much Is Enough?

Why Landlords Should Require Rental Insurance