After 45 + Years in Real Estate - What Works and What Doesn’t

Chris SeveneyBusiness Member

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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

2y

@Don Konipol

Great post Don. I would recommend everyone read this at least three times and just let it soak in.

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Drew SygitBusiness Member

Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes

2y

Nicely done.

Seeing a trend of posts calling out the instant gratification mentality of newbies!

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Chris SeveneyBusiness Member

Moderator

Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

2y

@Drew Sygit

Seeing a lot of posts here and on other forums about people buying real estate or making a quick buck, but that’s like someone bragging that they bought a stock that went up the first week. Let’s see where you are at in 3-5 years.

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Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

2y

One thing to add.

Kind of decide are you going to get into the business or just be an investor.

Makes a big difference..

And by that I mean do you expect to start off and in 5 years real estate creates all the income you need to live and support your family and lifestyle ??

Or is your goal to simply add RE assets for a long term retirement plan. And keep your chosen profession.

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Don KonipolBusiness Member

OP

Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes

2y

Quote from @Chris Seveney:

@Drew Sygit

Seeing a lot of posts here and on other forums about people buying real estate or making a quick buck, but that’s like someone bragging that they bought a stock that went up the first week. Let’s see where you are at in 3-5 years.

"Never confuse genius with a bull market"

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Carlos Ptriawan

Member since 2019 · 7k+ posts · 4k+ votes

2y

Quote from @Don Konipol:

Quote from @Chris Seveney:

@Drew Sygit

Seeing a lot of posts here and on other forums about people buying real estate or making a quick buck, but that’s like someone bragging that they bought a stock that went up the first week. Let’s see where you are at in 3-5 years.

"Never confuse genius with a bull market"

Don seriously you need to write a book "my anti thesis of what Biggerpocket tell you" ;-)
I wish everyone write like you.

1 Reply

Jacob Stevenson

Insurance Agent · Sioux City · Member since 2020 · 83 posts · 41 votes

2y

What is the key to finding a great property management company? How do you vet them?

1 Reply

Jonathan GreeneBusiness Member

Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes

2y

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Real-life references from other investors in the area who use them.

Also, it really depends on how many units you want managed. Offering a good company one unit is nothing to them so your options are slim.

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Robert Walter

Member since 2024 · 12 posts · 7 votes

2y

Quote from @Don Konipol:

What works -

1. Investing in well built properties that are able to generate positive cash flow with current rental rates

2. Becoming knowledgeable about a sector or sectors or geographical area (s) and limiting your investment to those sectors or areas

3. Developing a track record of successful investments and leveraging your track record by syndications or creating an investment fund

4. Judicious use of leverage (debt) when the property will still cash flow positive after debt service; when there’s enough equity left in the property to refinance if advantageous, and when sufficient reserves are held to cover vacancies, recessions, and unexpected repairs

5. Understanding that SPECULATIVE investments should be only a PORTION of your total portfolio, and should only be money you can afford to lose.

And what DOESN’T work

1. Investing in sectors you know nothing about - even if you think your “partner” has expertise

2. Paying $40,000 for “mentorship’s” which teach you nothing about real estate principles, real estate finance, or real estate law

3. Having no experience, capital or expertise and thinking your going to be successful setting up a “wholesaling” business

4. Chasing the latest “hot” real estate market, trend or location to invest in

5. Investing 100% of your liquid assets as a down payment and having no reserves to carry you through the rough patches.

6. Expecting other people to solve your problems

7. Expecting inexpensive (cheap) property management to be competent

8. Expecting brokers to inform you of the best purchase opportunities when you have no proof of funds, or pre qualification for funding

9. Expecting to get accurate answers to complex legal questions on a public forum so you can safe the $275 consulting fee of experienced legal counsel

10. Expecting real estate prices to continually rise with no periods of decline.

Now that’s what am talking bout right here Don……

You’ve said it all, and as far as I can agree these steps alone impacted my Journey triumphantly 30 years ago… Thanks 🙏

2 Reply

Account Closed

Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes

2y

6. Invest in Columbus Ohio

I’ll see myself out

8 Reply

Carlos Ptriawan

Member since 2019 · 7k+ posts · 4k+ votes

2y

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

I know a few good PM.

The secret: passionate owners !!!!!!
small pop and mom owner!

2 Reply

Eric Bilderback

Real Estate Agent · Sisters, OR · Member since 2014 · 1k+ posts · 1k+ votes

2y

Another thing I think that is worth noting is for people who don't have much of a net worth or much opportunity taking a calculated risk in real estate can be a great way to bring some freedom to your life down the road. Real estate will own you to start then it will bring you opportunities completely out of your reach now. If you have a solid career trajectory that you love or can at least tolerate you will obviously dial down the risk.

7 Reply

Jim K.

Handyman · Pittsburgh, PA · Member since 2018 · 5k+ posts · 13k+ votes

2y

It took us thirteen years to get to the point where both of us could quit our W-2 jobs, or at least substitute our jobs with work we do to support our real estate investing.

Yesterday I cleaned out my palm sander, sanded down a door with 220-grit that I had primed the day before, arranged to meet my agent at a property we're about to put on the market, primed a doorframe, read about personal finance for two hours, put together a shelving unit, dealt with a tenant over an electrical and cable internet shutdown. That was Sunday.

8 Reply

Michael McVetyBusiness Member

Fort Myers, FL · Member since 2024 · 46 posts · 20 votes

2y

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

[email protected]239-939-1233

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Account Closed

New to Real Estate · TX · Member since 2024 · 44 posts · 26 votes

2y

I almost fell for #2 in what doesn't work. So glad I didn't! Thank you for your wisdom, Don!

0 Reply

Steve Kontos

Investor · Great Neck, NY · Member since 2016 · 679 posts · 467 votes

2y

At the end of the day, respect the business!!!!!!

That means put in the hard work and dedication to the SPECIFIC type of investing you want to do. Instant gratification is an illusion.

4 Reply

Jacob Stevenson

Insurance Agent · Sioux City · Member since 2020 · 83 posts · 41 votes

2y

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

I appreciate the reply!

0 Reply

Carlos Ptriawan

Member since 2019 · 7k+ posts · 4k+ votes

2y

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

what is the difference between annual PM and PM (meant PM with annual) ??

0 Reply

Michael McVetyBusiness Member

Fort Myers, FL · Member since 2024 · 46 posts · 20 votes

2y

Quote from @Carlos Ptriawan:

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

what is the difference between annual PM and PM (meant PM with annual) ??

Hi Carlos.

Property Management is divided into a couple of areas though people often refer to it as "property management". Most people just use the term but there is association management, apartment/ Multi-family management and then property management.

For instance, in Florida, you need a license to practice Association Management (in most cases) and a real estate license to practice property management (in most cases). You do not need to have a license to manage an apartment community.

Property management can then be broken down into "annual" property management (normally a unit without furniture), a seasonal rental management (such as 2 weeks to several months up to 6 months) and then vacation rentals (sometimes for the weekend, a week, etc..).

Each state has its different rules and licensing for each area of property management (annual, seasonal and vacation) as well as the different areas of management (association, apartment and property).

I hope that helps.

[email protected]239-939-1233

Red Fortress Property Management Co.4.3314 Reviews

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2 Reply

Don KonipolBusiness Member

OP

Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes

2y

Quote from @Michael McVety:

Quote from @Carlos Ptriawan:

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

what is the difference between annual PM and PM (meant PM with annual) ??

Hi Carlos.

Property Management is divided into a couple of areas though people often refer to it as "property management". Most people just use the term but there is association management, apartment/ Multi-family management and then property management.

For instance, in Florida, you need a license to practice Association Management (in most cases) and a real estate license to practice property management (in most cases). You do not need to have a license to manage an apartment community.

Property management can then be broken down into "annual" property management (normally a unit without furniture), a seasonal rental management (such as 2 weeks to several months up to 6 months) and then vacation rentals (sometimes for the weekend, a week, etc..).

Each state has its different rules and licensing for each area of property management (annual, seasonal and vacation) as well as the different areas of management (association, apartment and property).

I hope that helps.

My understanding is that if you are an EMPLOYEE of the property owner you do not need to have a license; if you provide property management services as your management co owned business or as an independent contractor, then you do need a license.

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David Cheng

Homeowner · Member since 2020 · 29 posts · 12 votes

2y

Quote from @Michael McVety:

Quote from @Carlos Ptriawan:

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

what is the difference between annual PM and PM (meant PM with annual) ??

Hi Carlos.

Property Management is divided into a couple of areas though people often refer to it as "property management". Most people just use the term but there is association management, apartment/ Multi-family management and then property management.

For instance, in Florida, you need a license to practice Association Management (in most cases) and a real estate license to practice property management (in most cases). You do not need to have a license to manage an apartment community.

Property management can then be broken down into "annual" property management (normally a unit without furniture), a seasonal rental management (such as 2 weeks to several months up to 6 months) and then vacation rentals (sometimes for the weekend, a week, etc..).

Each state has its different rules and licensing for each area of property management (annual, seasonal and vacation) as well as the different areas of management (association, apartment and property).

I hope that helps.

This is immensely helpful. Thank you.

I have around 8-9 doors, small fish in a big pond. Would you just start cold calling in the phone book? or is it helpful to start on the NARPM and IREM directory?

What are the usual cost for these type of good property managers in major metroplexes? 10% rental revenue?

1 Reply

Michael McVetyBusiness Member

Fort Myers, FL · Member since 2024 · 46 posts · 20 votes

2y

Quote from @David Cheng:

Quote from @Michael McVety:

Quote from @Carlos Ptriawan:

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

what is the difference between annual PM and PM (meant PM with annual) ??

Hi Carlos.

Property Management is divided into a couple of areas though people often refer to it as "property management". Most people just use the term but there is association management, apartment/ Multi-family management and then property management.

For instance, in Florida, you need a license to practice Association Management (in most cases) and a real estate license to practice property management (in most cases). You do not need to have a license to manage an apartment community.

Property management can then be broken down into "annual" property management (normally a unit without furniture), a seasonal rental management (such as 2 weeks to several months up to 6 months) and then vacation rentals (sometimes for the weekend, a week, etc..).

Each state has its different rules and licensing for each area of property management (annual, seasonal and vacation) as well as the different areas of management (association, apartment and property).

I hope that helps.

This is immensely helpful. Thank you.

I have around 8-9 doors, small fish in a big pond. Would you just start cold calling in the phone book? or is it helpful to start on the NARPM and IREM directory?

What are the usual cost for these type of good property managers in major metroplexes? 10% rental revenue?

Hi David. 8 or 9 doors is great!

I would look at the narpm.org website to see if there were any management companies in your area. Depending on where your properties are, I could let you know if I knew any of them. I sit on several national committees so I may know of them. If you want to email me directly, great.

I can also discuss management fees but that is a very big topic because professional management companies can provide different levels of service (we are just rolling a new one out right now) so the management fee (and other fees) can be different even in the same company let alone compared to another management company.

Let me know how I can help you further.

[email protected]239-939-1233

Red Fortress Property Management Co.4.3314 Reviews

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Michael McVetyBusiness Member

Fort Myers, FL · Member since 2024 · 46 posts · 20 votes

2y

Quote from @Don Konipol:

Quote from @Michael McVety:

Quote from @Carlos Ptriawan:

Quote from @Michael McVety:

Quote from @Jacob Stevenson:

What is the key to finding a great property management company? How do you vet them?

Hi Jacob.

I will give you a couple of major thoughts being a professional property manager for 25 years.

1) Select a company that does annual property management only (as opposed to a real estate company that does sales and property management).

2) Make sure your agent/ property manager does it full time (as opposed to looking after your property after they have taken care of all their sales first)

3) The management company should be a active member of NARPM or IREM. That does not mean they write a check to get the "logo" to put on their website and look good (I have seen this a lot in my area sadly). They should have designations of education and experience as an example.

That will put you in a very select company right there and you should be good to go!

what is the difference between annual PM and PM (meant PM with annual) ??

Hi Carlos.

Property Management is divided into a couple of areas though people often refer to it as "property management". Most people just use the term but there is association management, apartment/ Multi-family management and then property management.

For instance, in Florida, you need a license to practice Association Management (in most cases) and a real estate license to practice property management (in most cases). You do not need to have a license to manage an apartment community.

Property management can then be broken down into "annual" property management (normally a unit without furniture), a seasonal rental management (such as 2 weeks to several months up to 6 months) and then vacation rentals (sometimes for the weekend, a week, etc..).

Each state has its different rules and licensing for each area of property management (annual, seasonal and vacation) as well as the different areas of management (association, apartment and property).

I hope that helps.

My understanding is that if you are an EMPLOYEE of the property owner you do not need to have a license; if you provide property management services as your management co owned business or as an independent contractor, then you do need a license.

Hi Don.

Yes, there are some times that you do no need to have a license even though a state may require to have one to be a property manager. Working for 1 owner and his properties could be an example where you do not need a license in some states. I do not think it only matters whether you were an employee or an independent contractor- I believe most states would look into how the security deposit funds and rental payments are held/ by whom.

Another example is that some states (like Florida) have only 1 real estate license to get (even though the Florida real estate license talks very little about property management). If I was working for a builder and talking to people about selling only those homes, you would not need to have a sales/real estate license. You can even do some activities (but not all!) in property management in Florida without a license but that gets into a grey area (negotiating rent, changing leases, security deposits, etc.. needs to be done by a licensed agent).

Some other states have a property management license you need to get to do property management (different from sales) and other states have no license requirements at all.

It can and is confusing going from state to state and their requirements. I hope that helps. Great question.

[email protected]239-939-1233

Red Fortress Property Management Co.4.3314 Reviews

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1 Reply

Marcus Auerbach

Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes

2y

Real Estate investing has generally negative cash flow for decades, meaning cash flows mostly from your bank account into investing. Cash for buying properties and cash for making them better. That's why it is called in-vesting.

If you want cash flow, start a business. Get a camper, paint it brown or black, cut out a window, put a college kid inside and sell coffee. Whatever.

I was on a real estate investor golf outing yesterday. Nice homes along the course, yellow Ferrari in the driveway. A fellow investor asks me what do you think these people do for a living? IDK, I said, but I can tell you that most of them barely qualified for the mortgage when they bought the house. I know because some of them were my clients. I also know how much money went into my RE portfolio last year, you just can't see that when you look at my driveway.

5 Reply

Jim K.

Handyman · Pittsburgh, PA · Member since 2018 · 5k+ posts · 13k+ votes

2y

@Marcus Auerbach

The thing I always think about when I look at the homes along the golf courses is how much I really don't want to know what goes on in them.

1 Reply

After 45 + Years in Real Estate - What Works and What Doesn’t

After 45 + Years in Real Estate - What Works and What Doesn’t

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