You’re not a landlord; you’re an investor

Any way you make money is going to be difficult.

If you have a job, you have a boss, coworkers, customers, deadlines, and problems to solve. If you own a business, you trade those problems for employees, customers, payroll, and risk. If you own investments, you get an entirely different set of challenges.

There really isn’t a version where you make money over a long period of time and never have to deal with something difficult.

Investors understand this.

And when we say “investor,” we don’t mean someone with millions of dollars or a huge portfolio. An investor is simply someone willing to make a decision today that they believe will benefit them in the future.

Successful Investors Are Comfortable Doing Hard Things

Think about the kinds of difficult things people voluntarily do for FUN.

They run marathons. They rebuild classic cars. They cook elaborate meals from scratch. They learn instruments and new languages. They climb mountains.

None of these things are easy. In fact, sometimes they’re downright miserable while you’re doing them.

But people enjoy the challenge because they understand what they’re working toward.

Investing isn’t much different.

Successful investors tend to have three things in common: they are willing to do challenging things, they understand risk, and they think long term.

There Is No Investment Without Risk

If you invest in an individual stock, the company could perform poorly or even fail. If you own a rental property, your risks look different. A resident may stop paying rent and need to be evicted. Someone may cause damage beyond normal wear and tear. A resident may not take care of the property exactly the way you would. A furnace can fail. A roof can need replacement.

The goal isn’t to find an investment with no risk. That doesn’t exist.

The goal is to understand the risks you’re taking and decide whether the potential long-term return makes those risks worthwhile.

Investing requires short-term sacrifice for long-term gains

Nobody wakes up one morning and runs a marathon. You might start by running three miles today, then four, then five. Those individual runs don’t seem particularly significant. It’s the accumulation of all those miles over time that produces the result.

Investing works the same way.

A mortgage payment here. A repair there. A new appliance. A month with great cash flow followed by a month with a large maintenance expense.

Looking at any one of those moments individually can be frustrating. But generally, the thing that makes an investment produce significant results isn’t one brilliant decision. It’s the time horizon.

Rental Property Ownership Is Difficult

We don’t think property owners hear this enough.

Owning rental property can be frustrating.

There are maintenance expenses. There are repairs you might not make if you were living in the house yourself. At your own house, you might decide the fourth burner on the stove isn’t worth fixing because the other three work just fine. In a rental property, that’s not an option.

Next month, you open your monthly statement and see a $1,800 repair bill.

That sucks!

Nobody enjoys spending $1,800 unexpectedly. You don’t look at a new water heater with the same excitement you might look at your investment account after it gained $1,800.

But those two things are more closely related than they initially appear.

The Money Isn’t Gone

One of the biggest mindset shifts rental property investors can make is changing the way they think about property expenses.

Money spent maintaining an asset isn’t automatically money wasted.

A new dishwasher stays with the property. A new water heater stays with the property. New flooring, paint, plumbing repairs, electrical improvements, and exterior maintenance all protect the property you’re ultimately relying on to produce income and retain value over the long term.

Some expenses simply come with operating a rental. Others extend the useful life of the property or improve it. Either way, maintaining a six-figure asset costs money.

That’s part of the journey. Continuing to invest in the asset.

Your Property Manager Is Your Ally

Your property manager shouldn’t be viewed as the person who collects rent and calls you when something breaks.

Think of your property manager as an advisor for the operation of your real estate asset.

When we tell you that an aging water heater needs to be replaced, we didn’t break the water heater. When we tell you a repair needs to happen, we aren’t excited about spending your money.

We’re trying to help you make the best decision for the property while balancing cost, resident needs, legal requirements, vacancy risk, and the long-term health of the asset.

The best owner/property manager relationships happen when we’re sitting on the same side of the table asking the same question:

What is the best decision for this investment?

Stop Thinking Like a Landlord. Start Thinking Like an Investor.

There is an emotional side to being a landlord that can become exhausting.

Did the resident cause that damage? Should they have reported this sooner? Why does Oregon require this? Why does this repair cost $500? Why can’t we charge the resident for that? Why do we have to fix this right now?

Those questions can consume an enormous amount of mental energy.

One of the reasons you hire professional property management is so you don’t have to live in that world every day.

Let us collect the rent. Let us send the lease violations. Let us document the property. Let us determine appropriate resident chargebacks. Let us keep up with Fair Housing requirements, Oregon landlord-tenant law and the constantly changing rules surrounding rental housing.

Don’t spend your Tuesday afternoon worrying about a $500 repair.

You already have professional responsibilities, families, businesses, and plenty of other things competing for your attention.

Make the decision. Spend the money. Keep moving forward.

Keep Your Eyes on Your Long-Term Goal

Successful rental property investors eventually learn to become more dispassionate about the day-to-day operation of their properties.

That doesn’t mean ignoring expenses or blindly approving every recommendation. It means evaluating decisions in the context of the entire investment instead of allowing every individual expense or problem to become a crisis.

There will be repairs.

There will be difficult residents.

There will be years when cash flow is better than others.

There will be months when you wonder why you own the property at all.

And then there is the bigger picture: years of rent collected, debt paid down, improvements made to the asset, and the potential for appreciation over a long period of ownership.

That’s the investor mindset.

Do the difficult things. Understand the risks. Make good decisions quickly. Protect the asset.

And most importantly, give the investment enough time to do what you bought it to do.

Thank you so much to all our owners and investors who came out to have a drink with us on August 7th! We had a blast discussing the successes and challenges of rental property ownership, and we hope to do it again in the future! Stay tuned for another event coming in October!