“It’s on my car and I can’t lift if off.” That’s the call I got from a tenant late one windy night in early December.
What would you do?
This was actually the third bizarre complaint in the same week:
– A tenant swore and yelled at his upstairs neighbor and smashed at the drywall because he thought it was too noisy when they came home. The upstairs neighbor was very frustrated as this has been an ongoing issue that finally culminated into a situation where they feel threatened.
– A tenant gave notice to leave 2 months into a 1 year lease because they changed their mind about living downtown. This is a big deal because a tenant turnover typically involves 20 hours of additional work for me(I self manage for myself and my partner’s), and I had just finished scrambling to fill an unexpected vacancy the month before so I was still recovering from that. This is on top of the work I do managing routine maintenance, keeping books, and building the business. (hardly leave time for full time work, sleep, and enjoying family time, so turnovers can be a challenge)
Stories like this can really freak out prospective property investors.
The potential for problems can be very stressful for the uninitiated, and prevents many would be investors from taking action. At times like this I sometimes wonder why I bother with property investing at all. Then I remember some sage advice from a mentor in my day job in crisis management:
Time solves everything.
When starting to feel stressed or overwhelmed, ask yourself: will this matter in 5 weeks, 5 months, or 5 years from now?
Chances are that this too shall pass, and 5 years from now no one will remember the stressful event.
Magic happens when you take a long term view, and you see the big picture. As 2014 comes to a close, I look at my modest portfolio and compare to one of my mentors. Since 2003 he has amassed enough property to collect $2M/yr in rent, and of that rent his mortgages are paid down roughly $200,000/yr.
That’s $200k that someone else deposits in his account every year!
I would need to grow my business 10x to get to that level, but even with my small portfolio I know that by taking a long term view there is a large reward waiting for me. I only need to weather the storms, and I will have control of assets that someone else paid for, my tenants.
So when the tenants fight, or give notice to leave right after moving in, or a fence falls on their car, I know that none of this will matter in the short term. I just need to solve these temporary problems on the road to lasting wealth, because solving problems is where the money is made.
In the words of a very wise woman(Melanie R):
“I work hard now on what few are willing to do, so that later I will live as few are able.”
So what was the extra work I had to do that week?
Fence situation: I told my tenant I would look at it in the morning and told her to take lots of photos. I hauled the fence panels to the dump, I gave my tenant my autobody guy’s number and told her I would pay for the damage, then I got my neighbor to agree to pay for half.
Tenant fight: I drafted a letter reminding them that they live in the same house and to adjust sensitivity to noise, and that profanity/threats/damage to property are not acceptable/are grounds for eviction, and promptly inspected the unit for damage. 2 weeks later and no further complaints, so far so good.
Early breaking of the lease: I reminded the tenant that I require written notice, at least 2 full months as per our lease. I immediately contacted some prior applicants who indicated they are still interested, and after Christmas I will follow my turnover flowchart. This includes putting up the for-rent lawn sign and biweekly online ads in both Craigslist and Kijiji with a huge amount of descriptive text copy that elicits emotion, staging, showings with multiple people at the same time to create, and extensive background checks.
Situations like this are routine, so a thick skin(or a partner with one) is necessary to get through these types of road bumps, and get to that pot of gold at the end of the rainbow.
Next time you feel overwhelmed, remember “time solves everything” so just put your head down and take action: do what needs to be done(or hire someone who will)!
Until next time,
If you want to learn how you can live “Your Life. Your Terms.” click here for a free book.