It’s a given that success in residential real estate investing means collecting more money from a rental property than you spend on it. Logically, that tends to lead to an over-reliance on “do-it-yourself” practices, which might seem an easy way to save money (even though it doesn’t always work out that way).
Before you roll up your sleeves and jump in, you might want to try asking yourself the following four questions first. It will make all the difference.
QUESTION #1: Is the job required one that I have the skill and experience to handle on my own?
Is it a leaky faucet that just needs a quick turn of the wrench—or something more complex? Don’t forget, even a simple job on a rental property can meta-size if certain, critical mistakes are made.
Ask yourself how much you really know about the area in question, and if you really have the ability to solve the problem quickly and easily the first time. If not, bring in the best. It will be worth the price.
QUESTION #2: How difficult and/or expensive is it for me to acquire the parts/tools needed to complete the job myself?
You’ve determined the problem isn’t beyond your skill set, but it may require the purchase of new or specialized tools. Ask yourself: Are they single-use tools? Will I ever need them again? Are they expensive? How about the part itself? Is it something you can acquire easily, or is it more difficult because you aren’t working in that area regularly
You might have the knowledge you need but pricey tools or hard-to-find parts might mean you’ll still save money even by hiring a professional contractor. Do your homework.
QUESTION #3: Is the job time sensitive?
A loose gate that needs tightening is not a faulty gas line. Sometimes there just isn’t time to wait and solve the issue personally. Without a doubt, emergency calls can be expensive, but getting the right person on site ASAP will be worth far more than any money you may save by trying to delay things until you can handle it yourself.
Safety issues alone demand a speedy response, not to mention the likelihood of more extreme damage if a serious issue is left untreated for even a few hours too long. Make the call—you’ll be glad you did.
QUESTION #4: How much is my time worth right now?
Some days, your time-value may come fairly cheap. Say you had a fairly light day, and already planned to be in the neighborhood of your single-family rental property. That means it’s no big deal to drop by and replace a light or repair some faulty fixture. In fact, that’s money intelligently saved.
But what about the day you’re set to meet with new tenants across town? Or maybe you’re in negotiations for an important deal that can’t be re-scheduled? Your time-value just spiked dramatically. That means the deciding factor to hire a pro just got much more cost-effective than even a few hours earlier.
Time = money, always…and that’s a calculation that can change by the hour for a busy landlord. Be smart and always value your time appropriately.
Smart Money Always Asks the Questions
Problems come flying at real estate investors and landlords on a daily basis. Taking the necessary time to ask the right questions will guarantee a more efficient use of your valuable time, which inevitably leads to a higher balance in your bank account at the end of the day. Now that’s an outcome worth striving for.
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