Hi Friend,
New real estate investors are just like experienced real estate investors. The similarity between these two groups is that they are both afraid of the same things when it comes to real estate investing.
The experienced real estate investors have learned how to deal with the fears that they experience. Whereas, the new real estate investors have not yet learned how to handle or cope with the fear that they experience surrounding real estate investing.
When I first started investing in real estate back in 2005, there were many things that I did not know and there were many things that I was afraid of. I was able to fight past these fears and I have since gone on to purchase Oakville real estate, Hamilton real estate, and Toronto real estate.
Here is a complete list of the:
Top 10 Things That All Experienced Real Estate Investors Dread…
1) CALLING TENANTS
When a real estate investor has to call their tenant, they become nervous because at that time there may be something that needs to be fixed. At this time the item that needs to be fixed could be big or small. The investor may have no idea how to fix the item, and may not know anyone that they can call in order to have the item fixed. As a result of this, the investor delays calling their tenant, because they are avoiding the problem.
What can you do about it?
You must set up a time and call your tenant every “first of the month.”
- Force yourself to do it.
- Make it a routine.
- Put it in your calendar.
There should be at the very least, communication via telephone with your tenant once a month. Email and text is not as effective communication versus over the phone. Face to face is the best.
2) REPAIRS AND MAINTENANCE
All real estate investors are afraid of the potential repairs and maintenance that arise with their rental properties. They are afraid of this because they always want to remain profitable, and they don’t want to lose money on their investment. When people lose money on an investment it causes them to begin to question their investment..
What can you do about it?
Have a reliable person you can always call upon for repairs and maintenance. Deal with repairs and maintenance issues as they arise. Don’t put them off. If you put them off they can become worse with time. As such, a repair that may have cost $200 may end up costing you $2000 due to increased damage to the property.
3) RENT COLLECTION
Experienced real estate investors worry about rent collection and if a tenant will pay rent on time.
What can you do about it?
Be firm. Do not bend the rules. If the rent is late, you submit the proper notice. Make sure that the tenant keeps their word. If the rent is late and the tenant says that they will provide it by a certain date, if the rent is not provided by the date, don’t’ keep on giving them grace. Call them on it, and enforce the non payment of rent through the proper means.
4) OPERATING LINE
Some experienced real estate investor worry about their operating lines going “too high”, and their revenues not being sufficient enough in order to bring it down. More eloquently put, they worry about drawing too much of their operating line, and fear that the revenue (rent collected) will not be sufficient in order to pay down the operating line.
What can you do about it?
Think like a bank.. Some Canadian Banks like BMO Bank of Montreal lend 10 to 15 percent of a company’s gross annual sales in the form of an operating line. Consider only borrowing that amount, and thus drawing your operating line to that amount. This will give you peace of mind and will ensure that yhou are not over extending yourself.
5) WATER LEAKS
Experienced real estate investors worry about leaks in the bathrooms and the damage it will cause to the house, overall if not looked after.
What can you do about it?
Inspect regularly for water damage. Make sure you do caulking on a regular basis. If you notice water seepage early, make sure that you do the work to repair the damage before the damage becomes more severe. Have someone inspect the property who has an eye for detecting water damage.
Interested in learning about the NEXT 5 Things That All Experienced Real Estate Investors Dread?
Check back into First Rental Property for the conclusion of this blog post…
Happy Investing!
Best Regards,
Neil Uttamsingh
ps: I am an experienced real estate investor and licensed Realtor. I help people like you everyday buy their first rental property. If you are interested in purchasing Toronto real estate, Ottawa real estate, Brampton real estate, Hamilton real estate, Richmond Hill real estate, Oakville real estate, Mississauga real estate, North York real estate, Kitchener real estate, or Brantford real estate send me an email at NEIL@FIRSTRENTALPROPERTY.COM.
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