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You Really Need A Written Lease For Your Rentals

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Why A Written Lease?

Written leaseIt’s astounding how many landlords I talk to that don’t have a written lease. They’ve either inherited tenants with a property and the previous owners never had a lease, or they simply haven’t bothered getting one as verbal is so much easier.

Now, guess when I usually end up talking to these landlords?

If you guessed when they are having problems with a tenant you win a prize.

Here’s why you need a written lease. It takes away the gray areas!!

Verbal agreements are open for interpretation. Written agreements (unless they are poorly worded) close up the gray areas and lay out the rules, the resolutions and the repercussions that accompany the agreement.

Payments, Pets and Pot

Late payments, pets that tenants “acquire” and marijuana smoking seem to be the three big issues that landlords talk to me about. Having specific clauses or sections within your lease that explain these can make a huge difference in how these issues play out versus a vague verbal agreement.

For rent payments you should have specifics about when rent is due, possibly methods it can be paid via (cash, e-transfer, post dated check) and any repercussions if rent is paid late. This could range from fines or penalties to warning notices all the way to evictions.

Different jurisdictions require different wordings for fines and penalties. Some areas don’t allow penalties, some have prescribed penalty amounts for late payments and others leave it wide open. The important part is YOU need to know what your local rules allow and then you need to make sure your written lease includes the correct wording allowing you to enforce and collect any penalties or fines!!

For pets, depending on your policies and local rules, you need to include specifics about what is or isn’t allowed. If you’re rental unit is part of a Home Owner’s Association or Condo Association there may be restrictions on size or type of pet that you have to carry over to your lease.

You may have personal restrictions for a suited property due to allergies of current or future tenants (once you become pet friendly it is an expensive proposition to remove pet dander and fur to return it to a state that a person with allergies can comfortably live in).

You may have had bad experiences in the past that you simply wish to avoid repeating. Whatever your personal situation with your rental, your lease needs to reflect this as well and have it explained thoroughly!

Again, rules and regulations vary widely. Some regions don’t allow landlords to dictate pet polices and others have strict definitions. You need to be familiar with local legislation or you need to have a lease designed specifically for your area.

Pot, or marijuana oh my.

This has become a huge topic of controversy with landlords on one side of the debate and pot enthusiasts on the other. and unfortunately since it is a moving target right now there is no one answer anywhere it seems.

My personal thoughts are if marijuana helps you with pain, sleeping or other health concerns then all the power to you. I do draw the line though if it affects me and my property by adding risk or costs to my life. If you own your own property go for it. If you are renting, you need to fit in the guidelines established by the landlord, or you need to find a landlord that will work with you.

These risks or costs I’m referring to involve potential insurance issues with tenants legally allowed to grow their own product, renovation costs to repaint or repair burns that seem to accompany smoking of any products.

If you’ve been following The Educated Landlord on FaceBook I’ve posted several articles about marijuana, insurance issues and legislation changes recently along with other landlord articles from other sites on a nearly daily basis. If you haven’t liked us on FaceBook yet and want to keep up visit us at https://www.facebook.com/TheEducatedLandlord/ 

Marijuana legislation will be a moving target so it’s important you keep up with the regional rules and changes to rules that come into play as the rules become more relaxed federally, statewide and provincially depending on where you live.

The important message to take away from this is you may have to add additional wording to reinforce non-smoking policies in your property. If it specifies cigarette smoking isn’t allowed it may require a simple rewording not allowing smoking of any kind in the rental property. And if it’s written and follows your local Residential Tenancy rules it can be enforceable.

Where To Find A Written Lease

Depending on where you live there can be multiple different places or resources you can find to acquire a proper written lease for your rental property.

One of the first resources I recommend to landlords are local landlord or rental property associations. Many organizations, either as part of their membership or for a reasonable cost, can provide appropriate rental forms that are usually well used, well tested and that stand up to the local rules.

They often have additional forms you can use as well such as move in/move out checklists, applications and more that can be handy.

Another resource is your lawyer. If you already have a lawyer who you use and who has a good understanding of the rental laws for your area they can create (or acquire from other lawyers they know) a good dependable and legally binding rental agreement.

The caveats here are not all lawyers are created equal and not all properties are the same. By this I mean that some lawyers rarely deal in rental laws and they may be poorly suited to create a quality lease for you. Residential Tenancy Acts often have subtleties and loopholes in them that someone experienced with the specifics can tailor to work best for you and your property.

This can also vary with the property. Most specifically when it comes to condo boards and rules within leases as often condo or home owner association rules take precedence over Residential Tenancy rules. A proper lease must take both sets of rules into consideration and may need to be very specialized for you and for a specific property.

This can involve additional costs, but the long term protection it provides you are well worth that cost especially when you factor it over multiple years which should be your goal with a rental property anyway.

Another option, which I don’t really endorse, is off the shelf rental packages you can pick up in stationary stores. While far better than verbal agreements they are often very generic and if you’re new to rental properties they often end up lacking in several key areas (like smoking, pets and pot as mentioned earlier).

You can typically take these leases and use them as a starting point, but you may want to take it to your lawyer to get it tuned up so it works best for you rather than the generic masses. And if you’re doing this, why didn’t you just start with a a lawyer?

The final resource I’ll mention are the online legal document resources. These would would be through a company such as LegalNature who provide a wide range of legal documents that include not just leases, but everything from Wills to incorporation documents to bankruptcy forms..

To be entirely transparent I will receive a referral fee if you use one of the links in this article to register with them or to purchase a Residential Lease Agreement or other landlord document. If you’re vehemently opposed to me doing that, but still want documents you can simply Google them to go directly there.

I’ve talked to several of the guys over there and they have a very thorough and in-depth system in place that allows you to create a custom lease (or other various Real Estate forms) that you can save for future use (with their ongoing membership program) or download and use (with their one time purchase program).

Their leases are US based only currently and are customized depending on the state with the most current information regarding Residential Tenancy Laws for the particular state and region you’re creating the document for. They are also quite long as they cover so many details!!!

In my conversations with Ben and Trevor of LegalNature, their default Residential Lease Agreement will run between 14-18 pages which isn’t an issue you should regard as overwhelming, but rather as details that will protect you as much as possible!

Some landlords believe simpler leases are better, yet given the choice having a detailed lease covering almost every situation will benefit you much more over the long run.

Rules and laws regarding landlord, tenants and rental properties often change or evolve over time. If you’ve been using the same lease for more than a few years it may well be worth  research to determine if any information in your older lease is outdated, un-enforceable or simply in need of updating.

Your Requirements For A Written Lease

You need a written leaseBig picture, it doesn’t matter where you get your lease from, you simply need to make sure it protects you and your rights as a landlord and property owner, that it includes any particular wording or phrasing required under local rules to make it legal and that you understand it.

You need to understand it as you will likely need to explain it to future tenants as part of the lease signing process.

You can expedite part of this by emailing the lease in advance to your prospective tenants, once you’ve narrowed it down to one set of tenants, so they can review it and have any questions prepared in advance. However you’ll still want to go through any and all important sections in person with them during the signing though, just to reinforce their understanding and to ensure there is no miscommunication.

What may be abundantly clear to you (No pets, Landlords permission required for renovations and many other items that seemed clear to you), may not come across clearly unless you point it out during that lease review!!

As I mentioned right near the start of this article, you want to remove the gray areas, you want to avoid gaps in understanding and you want to have the most control possible with your documents so make sure you get a written lease that works for you.

If you’re still using an old lease or worse yet a verbal lease take note of the information in this resource so you can get that remedied and put some control back in your life as a landlord. I know I continually harp on this, but only because it’s important. You need to treat your landlording like a business, so make a smart business decision and get a solid written lease in your pocket!

Another Landlord Down – When You’re Tired of Being A Landlord

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What Would Make You Quit Being A Landlord?

Would You Quit Being A LandlordAs you gain knowledge being a landlord you do it two main ways, through good experiences and through bad experiences. As a landlord bad experiences can be problems with tenants, lenders, insurance or even neighbours.

It’s one of those bad experiences that drove another landlord out of the business.

As many of you know, I help landlords in my area (Alberta) get through the process of evicting tenants. It’s knowledge I’ve gained through many bad experiences!!

One way I help is I’ve created an easy to follow step by step guide that walks landlords through not just the eviction process itself, but what to expect along the way. I really take the unknown out of the situation for landlords and give them confidence to get through an eviction.

Confidence they didn’t have before.

Now I’ve sold a lot of these guides over the years, we’re talking hundreds!! And I’ve only ever had to do a handful of refunds. So whenever someone asks for a refund I get curious.

Half of the time I know they’ve just taken advantage of my refund policy and the other few occurrences they’ve had very valid reasons. Well I had another refund request this week…

And the reason for the refund? Well the tenant left before the landlord could start the eviction. And he left a ton of damage behind. And he’s tired of being a landlord so he’s quitting…

Another landlord down.

Now it’s too late for this fellow, but the question comes up, could it have been avoided? And more importantly would it make YOU quit?

Be Prepared

You will have problems, challenges and bad experiences as a landlord. Solving them and getting through them will differentiate you from being a landlord who simply quits when the going gets tough or worse yet has to quit.

Now I’m not saying this particular individual gave up too early, I don’t have enough of the details I just know there is an important lesson here.

Unprepared landlords have fewer options to recover, fewer options to get them through tough situations and most often few or zero reserves to deal with a financial hit like lost rent or larger repairs.

If you want to survive the bad along with the good you need to be prepared.

This requires setting aside cash reserves to deal with bigger expenses, it involves understanding eviction rules so you can get tenants out quickly when necessary and it involves understanding potential financial, insurance and other pending challenges.

So really it involves being prepared and educated! And that’s the important lesson!

If you go blindly in thinking you will become wealthy by just buying and holding you may get a big surprise along the way. A surprise that can set you back significantly if you’re not careful.

Be prepared to not just survive when times are tough, but to thrive!

Today’s question, could you survive if you had a $2,000 hit against your rental property? A $5,000 hit? what about a $10,000 loss? Would you be forced to sell or could you make it work?

Leave me a comment below and share your strategy or plan during a bad experience with others. Also please share this with other friends and landlords you know so they can start thinking about being prepared!

Five Signs You Might Be a Bad Landlord

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Are you a bad landlord?
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We can’t all be the perfect landlord (I know I’m not as much as I try!), but there are definitely a few sign that could indicate  you could be heading down the path of becoming a bad landlord.

If you recognize one of these signs, you should be ok. Just correct the problem and you should be able to ditch that bad landlord stigma.

If you recognize two or three of these signs in how you’re running your landlording you’re going to have to make a decision about where you’re heading. You can continue down the pathway towards being a bad landlord, or you can do a bit of a course correction and straighten yourself out.

Finally, if you see four or five of these traits showing up continually with your rentals, it’s time to sell. You’re giving the good landlords a bad name and it’s time for you to move on!

Are you ready to find out about these signs?

Sign #1 You Might Be a Bad Landlord

No Written Leases

Listen, you need a written lease and you need it signed by all the tenants residing in your property.

If you don’t have a written lease you’re leaving yourself open to misunderstandings, potential problems and a ton of ambiguity.

Your written lease should address potential issues before they become issues such as rules regarding smoking, pets and even subletting (where allowed, some areas the “rules” don’t let you dictate what is always allowed or not allowed).

It should break down responsibilities for snow removal, grass cutting and property maintenance where applicable. And it should include what the repercussions for transgressing those rules specifically are.

It should cover all those details that could be rather vague, unless they are pointed out and it needs to protect you as much as possible within the local laws that govern landlord and tenant rules.

By not having your lease signed it’s just as good as not having one and the big problem is situations without written leases become a situation of he said/she said. This ends up being a situation where there is no proof you originally told them it was non-smoking, or that they couldn’t start a rabbit breeding factory in the spare bedroom (no pet policy).

So if you’re serious about being a landlord and you don’t have leases in place, go find some.

It may involve spending a bit of money with a lawyer or it may involve buying them from a local landlord association. Whatever you spend will pay for itself time after time and year after year going forward by reducing problems, headaches and even evictions when things do go bad.

Sign #2 You Might Be a Bad Landlord

You Haven’t Inspected Your Property In Over A Year

visit your rentals every six monthsIdeally you’re visiting your property and doing at least a quick inspection every three to six months, but worst case you need to at least get in there yearly, even if they seem like great tenants!

A lot can go wrong in a year, heck a lot can go wrong in three months!

That beautifully renovated property with the new carpet and high end hardwood may need to be replaced if you find out your tenant has been rebuilding his leaking motorbike on it over the winter months.

The little leak underneath the kitchen sink that the tenant didn’t catch could require completely gutting the kitchen and replacing everything. And these are the obvious things you’ll notice just by visiting and taking a peek!

With quarterly or every six month visits you can replace furnace filters which will extend the life of your furnace, you can replace smoke detector batteries which could save lives and your property and you can even notice potential problems that could grow into huge problems if left un repaired.

If you haven’t visited a rental property of yours in the last six months stop reading now and start scheduling a visit before continue on! Don’t be a bad landlord or a landlord who suddenly has to deal with a very expensive repair in the near future!

Sign #3 You Might Be A Bad Landlord

You Refer To Your Property as “It’s Only A Rental”

If you’re referring to your rental property, your expensive investment, as “it’s only a rental property” you’re setting yourself up for failure.

If you’re creating a mental environment where you’re not thinking of your property as someone’s home, where you’re potentially allowing sub standard work, lower grade finishes and even ramshackle repairs to be done, you’re setting yourself up for failure. And that’s what happens if your property is just a rental.

When you start referring to your property as only a rental you’ve already established you don’t care about it and it’s not long before it starts to become neglected (refer to Sign #2).

It’s too much work to go inspect it, it’s too much expense to do proper repairs (after all it’s just a rental) and in no time flat you start seeing your tenant turnover sky rocket and your vacant periods increase.

Then after a year or two of losing money you become another one of those landlords who say Real Estate doesn’t work and sell off your potential asset.

It’s not just a rental it’s a long term investment that can reward you handsomely over time and with proper care and attention. Remember that, or save yourself time and start planning to get out now.

Sign #4 You Might Be a Bad Landlord

You Ignore Your Tenants

return tenant calls promptlyThere’s nothing as annoying as getting interrupted when you’re out having a nice evening out with a spouse or girlfriend or even your family. It’s worse when it’s your tenant calling about a problem with the furnace, in minus 20 degree weather.

At least until you realize that because you have that rental property you’re able to have a nice evening out, or that you have a few extra creature comforts, like heat, because you’re setting yourself up for long term success.

It’s freezing out and they don’t have heat so you need to get on that and not ignore it!

OK, that’s one of the worst case scenarios, but even if it’s something simple like a broken dishwasher, clogged sink or slow drain in the bath tub, they shouldn’t be ignored.

How you handle situations with your tenant can directly affect how long your tenant stays with you and if you keep them happy by dealing with issues in a timely manner they will stay much much longer!

If you can reduce tenant turnover to once every few years it will make a direct impact on your bottom line.

Tenant turnover leads to vacant months with no rental income, extra time spent on advertising and meeting prospective tenants and money flowing out of your pocket as you cover expenses related to the property like water, heat, insurance, taxes and mortgage payments with money out of your bank account.

Even if you don’t have an answer, don’t leave your tenants hanging. I currently have a tenant in a property about two hours from me with plumbing issues (not a water leak, but a shortage of hot water, probably a tank that simply needs flushing).
I don’t have an answer right now, but I’ve replied back to her that I should have an update later this afternoon. I’m keeping her in the loop, I’m acknowledging there is an issue and I’m addressing it and she knows I’m not ignoring her!

So don’t ignore your tenants. If you keep them happy and keep them satisfied you’re a good landlord, not a bad landlord who can’t be reached, you’ll be rewarded with longer term tenants and more cash flowing into your bank accounts!

Sign #5 You Might Be a Bad Landlord

You Don’t Treat It Like a Business

I bring this up a lot, mostly because it’s important, but also because failing to treat your landlording like a business can lead to you failing. And failing with property can be an expensive lesson.

The more you treat the entire rental business as exactly a business the more you’ll do to set up the proper practices to help you succeed.

This can involve moving from using a simple spreadsheet to track your income and expenses to moving to dedicated software of customized accounting systems that allow you to track and control much more of your business.

It involves moving from picking a tenant cause they seem nice to having a proper system in place to screen tenants, places to acquire credit and criminal reports as necessary and understanding the local laws regarding rentals and how they apply.

If you treat it haphazardly you make mistakes, or take shortcuts and those mistakes and shortcuts cost you dearly. I’ve seen landlords use free leases they found online that were invalid because they didn’t refer to local laws.

I had a landlord try and evict a tenant using an eviction form from the incorrect state (it gave the tenant another free month of rent as he had to resubmit the correct form after the fact).

These are the shortcuts that backfire on you and are another reason that can cause you to quit the rental business.

Set yourself up for success.

Don’t Take Shortcuts

Shortcuts are attractive because they may get you started in the direction you’re heading faster, but shortcuts don’t always provide the results long term you’re looking for.

If you’re serious about being a successful landlord,  become an educated landlord, learn to manage your properties as if it is a business and it will all become easier and simpler to either carry on as is, or to expand later. If you’re doing it right it gets easier.

And if you’re dropping a ton of money into Real Estate already what’s another little bit to make sure you’re doing it right.

Money spent on having the proper leases, money spent on getting the software to make your job as a landlord/property manager easier and time spent making sure you have systems in place all come back to reward you as you move along your rental property ownership path.

Lining up accountants and lawyers familiar with Real Estate make your life simpler and more controlled long term. These are all parts of your long  cut to long term financial wealth so try not to stray.

Is there any other additions I should have on this list that bit you in the butt as a landlord? I’d love to hear your feedback, leave me a comment below!

 

 

 

 

 

 

The Trump Era – Why Landlords Should Be Happy

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Your Rental Property Doesn’t Care Who Won

Storm is ComingAs the stock markets react with fear, uncertainty and turmoil to the election results, it should be comforting to you as a landlord that your property values are essentially the same as yesterday.

You see that’s the great aspect of property and land. It’s not affected with the immediate fear and uncertainty that hits the stock markets after major events like an election. It can still provide shelter, even during stormy times.

Now I’m not going down the rabbit hole of whether Trump will be good or bad for America, it’s far to early to really say what the true outcome will be, but I will say the one aspect that doesn’t change with these results is people still need homes and properties to live in and to rent. And this is good for you!

If the stock market decides to plunge even further (as of the latest news several major markets plunged 4-6% since yesterday but are now holding steady), home prices will generally remain unscathed at least for the near future. Will the markets recover, probably and that’s the great thing about fear based markets, the fear fades and reality eventually returns.

Now there is a chance that if the 48,000,000 Americans who announced they will move to Canada if Trump wins actually do leave there may be some huge fallout, but we all know that isn’t really going to happen.

So today, whether you are feeling despair or triumph, stop for a moment and think about your property. Think about the positives. Think about how smart you were when you first bought it and how much smarter you hopefully feel today.

Owning property now, having an investment that you control and that is not subject to the instant fear, turmoil and uncertainty that accompanies the stock market makes you just that much more secure in your life and you shouldn’t forget it.

So stay the course, be happy you’re a landlord and continue to become more educated and more aware of how your investment will carry you through the uncertainty that will be unfolding over the next little while and the uncertainty of the future.

 

Making a Quality First Impression

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Exuding Quality

Quality productI recently purchased a new fall coat and as the weather is starting to really cool off in the mornings I felt today would be a great day to wear it out.

To be fair this wasn’t a really expensive jacket, in fact it wasn’t even a real “jacket”, but rather a nice hoodie that had a very fuzzy interior lining, plush according to the label. A lining that would keep me perfectly warm on a cooler day.

I don’t even think I paid $50 for it, but it looked good and felt warm and comfy when I tried it on, so I was hooked. That was back in early August and since it’s been so nice it’s been safely squirrelled away in my closet waiting for the cooler fall days.

Well, now that we’re into October, those cooler fall days have quickly arrived! So out comes the new fall hoodie and that’s when I made some observations. It was as I was cutting the tag off that I noticed something. Just a tiny little detail.

But a tiny detail that upgraded my impression of the jacket, sorry hoodie, to another level.

The tags were made of a very thick sturdy paper that instantly upgraded my thoughts about the quality of the clothing.

Feeling the heft and weight of the tag made a huge impression on me. This tiny little incidental item, a tag albeit a nice one, exuded quality and the feeling that the manufacturer’s of this product actually cared about it.

It was as if they they didn’t cut corners, as so many people do, and rather than throwing on the cheapest tag possible in order to save .0001 cents, they had a better product that deserved a better tag.

Have you ever felt like this when you bought something?

If you did, how did it make you feel? A little prouder to own it? Maybe you stood up a bit straighter when you wore it or your friends saw it?

Now here’s the zinger, do your tenants say the same thing about your rental property…

Exuding Quality With Your Rental

They say you only get once chance to make a first impression and it’s so true. Although with my coat it was actually the second impression when I looked closer, but you get the idea!

Well, what impression does your rental give to potential tenants? Or to add to it, what impression do you give?

Is the entrance tidy and clean, or worn and cluttered? Do you show up in a torn t-shirt and the same shoes you use to cut the grass (which may be ok if you are actually there cutting the grass…).

Did you pick up a welcome mat from the Dollar Store that looks cheap, or did you spend a few extra dollars and buy a nice sturdy mat from a home furnishing store? It’s little upgrades like this that can make that good first impression!

Maybe it’s just a new door handle instead of the old worn knob, maybe swapping out the broken and chipped door skirt for a new tidy looking one to help make your property stand out.

It’s little steps like these can can help ensure your property not only gets rented faster, but stays rented. We often forget that our rentals are people’s homes and its a trap that can bite you in the pocketbook later.

Sure when the rental market is hot it’s not much of an issue, but when things turn, and they inevitably do, and the market is a bit tighter with more vacancies and less tenants to go around that they suddenly become very pressing issues.

Consistently High Quality Rentals

first impressions make a difference with your rental property

That’s why it’s far easier to be consistent with your properties and be pro-active at setting a higher standard. Then you don’t run into the hurdles of the down times, or if you do, unlike your competition you coast through them as others flounder.

This type of pride of rental property ownership pays more dividends than just filling your property faster, it also helps you keep tenants longer, attract higher quality tenants and as you stay on top of your property it helps maintain values.

A story I share with many people involves a property I owned years ago that had a very similar property just down the street. At least very similar in the style of property.

Both were half duplexes, both had front decks and both had yards, but the similarities ended there.

My property had tenants in place usually two to three years at a time, theirs had a for rent sign out front every six to nine months.

Now we’d never personally been in the unit, but one day my wife was at our property and saw the other landlord was doing some showings so she invited herself in to check it out, and chat with the owner.

Upon entering the difference was easy to see.

Now this was only a decade ago, but the other property still had the original shag carpeting from the 70’s in it…

And quite possibly the original white paint color, great first impression.

Going further into the property and looking at the kitchen my wife found the original dark brown fake wood look cupboard doors with more original 1970’s hardware.

No wonder people kept leaving like it was a revolving door.

In comparison, our property had hard wood (which probably had shag carpet on top of it at one point), freshly painted walls with a modern color, newer white kitchen cabinets with newer countertops and bright shiny contemporary knobs on all the cabinets.

It’s Not Rocket Science

First Impression of qualitySo just by description alone, which would you chose?

And maybe that’s why we were always able to fill the property so quickly and kept tenants for so long!

Now, let’s talk about you and perhaps some homework?

What do you think your property gives off as a first impression? Cozy place to call home? Or pitstop until we find something better?

Your homework, if you truly want to be an educated landlord, is to stop and take an objective look at your property.

Would you live there? If not, that’s the first sign you might want to change things.

What could you do to spruce it up just a bit? New front door? Drastic updates at the entrance to make it more inviting? Or maybe simple steps like fresh paint on the door and a new handle or trim plate across the bottom of the door?

Taking simple steps like this pay handsome dividends over time and it’s a matter of small efforts to get this done that pay back so well with longer term tenants and shorter gaps between occupancy.

If you’re struggling to fill your vacant property this might want to be a priority. If you expect to have a vacancy soon it should also be high on your radar. At the same time, if you have great tenants it can also be an assurance to them that you want to take care of your property and can also be rewarded with them acknowledging it and taking even better care of your property for you.

So, ball is back in your court. Are you willing to do some homework? If you are I’d love to hear what YOUR thoughts are on YOUR property and what you might need to do to improve it and to start making a good first impression as soon as possible!

Leave me a comment below with any changes you may be making in the near future to your property or with any changes you’ve made in the past that have paid dividends!

Did Your Goal Planning Work Out?

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Did You Even Goal Plan?

Goal Planning Your Real EstateOr did you even do any goal planning? Without goals, you simply end up coasting through life and as the last several years of my life have shown me, you need to know when to coast and when to push.

When I look back at my most successful years, it all started with goals, plans and a destination. When I look back at my least successful years they all involved no goals, haphazard plans and zero destinations. Think it’s a coincidence?

I don’t.

I’m getting up there (in my mind anyway). I’m not as energetic as I used to be, I’m not as athletic as I used to be, I’m not as aggressive as I used to be and the list of not’s can now go on far longer than I’d like. But one thing I’m not is dumber.

That’s why I want to do what’s worked for me before and why I’m going to make it work again.

The Problem(s) With Goal Planning

The problems that pop up when people start goal planning could end up being a list as long as my arm, but I’ve taken so many seminars, courses and read so many books that talk about goal planning I’ve got some helpful tactics I want to share with you.

The big problems I see people running into with goal planning are making their goals realistic, making them achievable and staying on track with them.

So let’s talk about those.

Realistic Goals

I want make a billion dollars! Realistic, or just wishful thinking?

For the majority of us not just unrealistic, but also not very specific which can be another problem. By making goals specific they also become easier to accomplish, so a better example would be as follows.

I will increase my monthly income by $2,500 by December 31st, 2020.

Now it’s become not only realistic, but specific as I’ve listed an amount and a timeline to achieve it.

Keeping Goals On Track

Tracking Your GoalsSo now that it’s realistic, I need to keep it on track, so as a Real Estate investor, how would you be able to achieve this goal?

First thing that pops into my mind would be to increase my portfolio, but then what?

Well, I see several options now. If I plan on increasing income by $2,500 per month that means I need at least one, but realistically several more properties to achieve this.

If I have determined that I make $1,250 cash flow from a single rental property I own I would need to replicate it twice to achieve over the next 12 months to achieve that goal. If I only make $500, I would have to do it five times to achieve my goal.

If you’re like me though, it suddenly creates new problems. I don’t have enough money lying around to buy five more properties, so if that is the situation I’m in, maybe that goal wasn’t realistic and it needs to be redefined, or I have to get more specific!

Specific Goals

With Real Estate there are so many ways to skin the proverbial cat we could easily create a new list as long as my arm of how to make money in Real Estate.

Maybe that original realistic goal morphs into the following.

I will increase my monthly income by $2,500 by December 31st, 2020 by partnering with two or more investors who will help with financing.

Or,

I will increase my monthly income by $2,500 by December 31st, 2020 by increasing the income from my current properties by $500 each and adding another property that generates $1,500 income per month.

Or maybe,

I will increase my monthly income by $2,500 by December 31st, 2020 by learning
how lease to own properties work and adding two properties that
generate $1,250 each to my portfolio

Notice how each iteration becomes it’s own specific goal? A goal that could be achievable by just about anyone reading this article? the sky is the limit when it comes to setting goals, as long as you also include some specifics and a plan as to how to get there.

But that plan also needs to be trackable and accountable!

Tracking Your Goals

The tracking part is where goals often fall apart and they are also what separate the people who achieve them from the ones who let them fall to the wayside.

With goals like our $2,500 increase we’ve already set the deadline to achieve it of December 31st, 2020, but our next step would be to set timelines as well.

Looking at the first goal which involves adding two or more money partners, you need to donate time to find them before you can even start. Suddenly your goal morphs even more and might look like this.

I will increase my monthly income by $2,500 by December 31st, 2020 by partnering with two or more investors who will help with financing. I will acquire the first investor by March 1st, 2020 and the second by July 1st, 2016 with two additional properties purchased by September 1st, 2020.

Using the second goal and morphing it, you may find something like this.

I will increase my monthly income by $2,500 by December 31st, 2020 by increasing the rents on my current properties by $500 each by June 1st, 2016 and adding another property that generates $1,500 income per month by September 1st, 2020.

And since we’re morphing, let’s look at the third goal.

I will increase my monthly income by $2,500 by December 31st, 2020 by studying lease to own properties for the next three months and adding my first lease to own by June 1st and my second by September 1st
adding $1,250 each to my portfolio.

Now these are all achievable, trackable and you should be accountable to at least yourself to reach these goals. Of course, these are all generic goals and I’m not saying any of you should specifically use them, they are just examples. Yet they are examples I hope you can learn from.

My Wife’s Take On Goals

Everyone should have their own little tactics and strategies for achieving their goals, but my wife has put together a pretty helpful walk through for folks and she’s been kind enough to let me borrow it and post it here.

As an entrepreneur herself she has had to coach people along the way and created  steps on goal planning that she shared with her fellow artists and entrepreneurs, so here you go. It was from January a couple of years ago, but since this is coming out in December, that means maybe you can start early!

I hope between the two of us you’ll get something out of this and it helps to make 2016 your best year yet!

The Great thing about goal planning is that you get to start fresh….a time to re-evaluate what worked for you last year and what didn’t.  This time is a chance to tweak things, or just to start fresh.  Any successful business person must be able to plan for their business.  I want you to really focus on your business in regards to this goal setting.  Yes, you can apply it to your personal life, and that’s a good thing to do, but for today’s benefit it’s all about your Business.

Now, we’re going into this year with January almost over, but that’s okay.  Any time is a good time to start your goals.  My husband and I have created an annual event on New Years Eve where we sit down with a nice glass of wine and talk about the past year, and set our goals for the new year.  We’ve done this for many years, and now our girls join us.

1.  Take a look at last year.  Take a sheet of paper and divide it in half.  On one side write down what worked the prior year.  What got you excited, what your customers liked, what were your successes.  What made you the most money.  And what do you enjoy doing the most.

On the other side write down what didn’t work, things that didn’t make you money, wasted      your time, or you just plain didn’t like.  Think about what you need to stop doing…..perhaps it’s  saying yes to everything that bogs down your life.

2.  Start planning your goals.  First think about the things that were a success, they are already working, what can you do to improve them or stream-line them?  Do this before you start adding new Goals to your list.

The thing about goals is that they should be reasonable, and measurable.  Sure I would like to earn $10,000 a month….but is that reasonable based on how much work I’m prepared to do.   Whether you intend to go hard with your business or not, being clear on your intention and what you can achieve is really important.

3.  Setting goals can also create a great mountain that seems impossible to conquer.  So you need to make sure that your goals are broken down into mini-goals.  When you are able to check off little tasks that will eventually take you to your goal, you will be motivated to continue, and feeling good about your progress.  If you feel good about what you are accomplishing you will continue forward with a positive frame of mind.

Pat Flynn from  SmartPassiveIncome.com  has a great phrase.

Write it down…get your goals out of your head where all the other stuff is rattling around and write it on paper, or a white board.  Once you do this, then the goal is real, and not just a thought.

Break it down…Task it out into little mini-goals.  The only way to get the big goals completed is by giving yourself achievement along the way.

Take it down… this is where you start chipping away at those little tasks, checking them off to   get you closer to your goal.

4.  Review your goals!  This is so important for you to succeed.  Putting all those mini-goals into months so that you can focus on them individually.  If you try to focus on all the mini-goals, you will not be giving the appropriate attention that you need to get that goal completed.  The reason I want you to review your goals monthly is to help you keep on track.  If you fall off, it’s only a month that you need to make up for.  If you review quarterly, you will either forget it’s the quarter, or if you missed the goal, you are now three months behind.

If you are a goal planner, I’d love to hear from you! Maybe leave a comment here and share how it’s helped you. If you don’t goal plan, maybe this was the incentive for you and next year you can come back and tell us how it worked!

Either way happy 2020 to you!

You Will Fail As A Landlord

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It will happen at some point.

Turn failure around as a landlord so you succeed

It might be something small, it might be something big, but you will fail at some point as a landlord and sorry it’s not an option.

It’s what you do with that failure though that will separate you from the landlords that simply quit after there first bad situation.

As many of you are aware, I have one website that teaches landlords (and tenants) about the eviction process where I’m located (www.AlbertaEviction.com for those that are interested). I have thousands of visitors each month and many of them are landlords who have just gone through their first eviction.

And often they are so disappointed with having to evict a tenant for the first time they are telling me they will be selling their property and it simply baffles me.

What the hell were they thinking and what lesson are they learning? They failed to have the proper tenants in place either through a mistake on their part, or bad fortune and they are taking their ball and going home? Not only did they fail, but they failed to learn and that’s far more depressing.

We all fail.

It’s how we learned to crawl, it’s how we learned to walk, it’s how we learned to run and it’s how we learn to grow. If we quit every time we failed we’d all still be sitting around on the floor in diapers never taking a chance to learn to crawl, walk or run.

Yet here are people who have invested typically their hard earned money into property and becoming a landlord and turn tail once it gets hard. These people are destined to continue failing as they won’t learn from their failures and use it to improve.

The few landlords that I do get to talk to I try to break it down for them.

They’ve just gone through one of the worst problems a landlord faces, the eviction process. They’ve gone through it and they now understand the process which does three things.

First it educates them (yes I am a big proponent of landlord education surprise right?), second it makes them highly aware they don’t want to do this again and leads to better screening, more diligence about their property and a renewed interest in treating their property like a business and third it shows them what they need to do if it ever happens again which takes a ton of fear, uncertainty and doubt (also known as F.U.D) away from being a landlord.

Now that you’ve gone through this and are better educated and informed, is it really the best time to walk away? That is an even bigger failure than going through an eviction.

Learn From Your Failures

Failures are lessons we need to learn from and adapt so we don’t repeat them.

And the more painful the failure the more we should learn to avoid repeating them!

Whether it’s evicting a problem tenant, discovering your property is illegal and is getting shut down, discovering your lease is inadequate or a million other instances or problems that can pop up in the life of a landlord these are all lessons we need to learn from rather than accept as failures.

I’ve failed more than most, but that’s simply by sheer volume, the important part is I try to learn from each failure and not repeat it.

I’ve learned about partners the hard way, I’ve learned about mortgages the hard way, I’ve learned about bad tenants the hard way, I’ve learned what needs to be done when tenants die in your property, what happens when sewer pipes collapse at your property and so much more.

Some of the problems were out of my control, some could have been avoided I learned after the fact, but I learned from all of these examples and a multitude more. Many of these lessons I now try to share through these articles and posts so you too can avoid them.

So it’s your choice, you can fail and quit, or you can embrace failure as an opportunity to improve, to rebuild and to come out better than ever. Just make the right choice!