Detangling: Buying Property & Property Managing & Asset Managing

[Grant Shipman]

When I was starting out, I was told about the difference between owning & PM'ing.  I didn't realize it until later, but it super helped when I realized there's the following main skills everyone who aspires/is a rental property investor. 

Buying A Property: this is every acquisition (analyzing, financing, syndicating, closing)

Property Management: this is marking, screening tenants, leases, managing tenants, & managing small repairs. 

Asset Management: this is what I did not know about. This is actually where the big money is. It is setting up allocations for rental income, screening/managing your PM, audit-proof books, tax optimizations, leverage management/optimization (when to refi/sell/HELOC).

In my experience, the AM skills above are not well taught nor are they well understood by us investors. But it's WHERE ALL THE MONEY IS!  I 100% waive the cash-flow flag, but where the big windfalls are and how to avoid the PEE (portfolio extinction event) that stop you in your tracks.  AM is not harder to learn than how to buy a property or manage a property, but they are separate skills.  I'm happy to help anyone grow in these skills. 

Here's some comparisons to clarify:

Buying a property is analyzing/forecasting budget................VS.............AM is tracking & allocating finances. 

PM is managing the daily operations.......................................VS.............AM is managing the actual asset.

Buying A Property is part of Financial Literacy.......................VS.............AM is an additional & separate genre of Financial Literacy 

I hope this helps! 

Go live your days dreams!!!