We are only a little over a month into the new year, and hopefully you have started working towards this year’s goals. If you have yet to start, don’t worry it’s not too late. Hopefully, this post will provide the motivation you need to get going, or help keep the momentum!
If you have listened to the BiggerPockets podcasts you know that everyone has their own unique story on how they entered real estate investing. It can be overwhelming to hear someone say they do 20+ deals a year, without realizing that everyone started with just one. That’s right, the one thing (and possibly only thing) that all of these stories have in common is that everyone started with just one deal.
A little over two years ago, my dad and I decided to jump into the real estate investing arena via flipping. On paper, we looked fully competent, and ready to handle the challenge. My dad had his own general contracting business for 40 plus years, and even worked on previous flips with other investors, and I came from a background in project management. In other words we were able to combine the “street smarts”, and the “book smarts” of investing via this partnership. But, we had one MAJOR hurdle to overcome...I live nine months of the year in Europe! Not only am I am not available physically to go through the house with my dad, but due to the time difference having meetings, decision making, and seeing houses is a bit challenging.
Obviously, this post in itself is evidence that we overcame this challenge. However, the solutions were not realized overnight. Like everyone you hear, or read about on BiggerPockets we had to find creative solutions. Today, I handle all of the items you can do virtually: finding houses, running the analysis, tracking budget, submit offers and sign-off on accepted offers, purchasing materials from online retailers, working with tax accountants, setting up and canceling utilities, ordering materials, designing the houses, maintaining our social media pages and website, and other administrative items that can be handled from afar. My dad does everything else: walks through houses, meets contractors, attends closing, manages the schedule and contractors daily, collects insurance and signed contracts from the contractors, pays the contractors, purchases store bought materials, and any other thing we need that he has to physically be there to do. Together we view the house via facetime, contact contractors, create and review the budget, and create and review the timeline.
How did we figure out who does what? Communication! Communication is the reason for both our success and our failures. We now communicate a minimum of once a day, but most of the time it is at least three times a day (whether it is via text, email or call). When I look back at the breakdown, it is obvious now why my dad does certain items and I do others; however, you don’t realize how many items can be tackled virtually until you are put in a position that forces you to explore that option. And while you may be saying to yourself, “Your dad could really handle a lot of the items that you are doing”, that is true, however it almost always comes at a cost. Ultimately, allowing my dad to prioritize and focus on the day-to-day job site has allowed our projects to run on time, even when challenges arise.
Our business is not running perfectly yet, but we notice it getting better and better with every house that we do. Most notably, we just completed a full rehab with a similar scope as our first project. Two years ago the project took almost 9 months, and our latest house took 9 weeks! We are constantly looking for ways to improve our business, and we get excited every time we identify a new cost/time savings method. Remember, everyday and every dollar counts in this business.
While your situation may not mirror ours, it is important to realize that everyone has a set of challenges they need to overcome. Solutions only come when you first identify the challenge. Start today, identify your challenges, and start looking for those solutions!
