SMARTERLANDLORDING

ADVICE FROM EXPERIENCE

The Business of Landlording

Should You Wait On Real Estate?

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Talking with Richard Scarbrough last month while recording Episode 19 of the Smarter Landlording Podcast brought out an interesting idea.

We have all heard about, if not actually felt, the increased amount of tightening going on against landlords these days as a result of the covid pandemic.

The courts are closed.

Eviction moratoriums go on and on.

There are calls for rent strikes and rent forgiveness.

New regulations and restrictions are passed almost every week.

It seems landlords just will not be able to win making real estate a terrible investment to get into right now.

Or is it?

And this is the point that Richard made. Perhaps all of these new regulations, moratoriums and tightening against landlords will create opportunities. Opportunities for those who have the knowledge and are persistent enough to push forward. Those willing to be in it for the long haul. Those who do not wait for things to get better or loosen.

Think about it. The increased stresses of being a landlord brought on by governments during this pandemic will cause some to say “To heck with it!” and get out of the market. Those folks will leave opportunities for those of us who stick with it. Those opportunities could be the properties that they decide to sell, or the reduced amount of competition for the properties already out there that they decide not to pursue.

Yes, there is a lot of doom and gloom out there regarding the pandemic, the economy, politics and where things are going in general. But to be successful one has to be optimistic even when it looks like everything may be coming down around you. You have to look for the opportunities and stick with it. All of the doom and gloom may in fact make real estate an even better investment.

Remember, as I say in my book, Advice From Experience To New Real Estate Investors:

Anytime is a great time to buy. Sure, there can be real estate bubbles and times you should not follow the crowd. Bubble or not, the trick is knowing what to buy and what not to buy no matter what the market conditions are.

Real estate is a great investment. It is solid and tangible. You can see it.  You can go stand on it. Most of it is not going anywhere, nor is much more being made. Real estate, no matter where we are in the business cycle, is always wise to buy. But, you have to buy wisely.

And buying wisely is always the key. Don’t go along with the crowd and remember your cashflow fundamentals. There may have never been a time where real estate was a more wise but difficult investment to make.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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The Tightening Against Landlords Continues

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Back in July, I wrote that the slew of new regulations and restrictions against landlords would likely never go away. History shows that once the ratchet is tightened, it is never loosened completely. Some of the headlines from Maine to California seem to be proving my predictions correct.

Landlord-tenant laws in Virginia spurred on by covid could be come permanent.

Minneapolis to consider rent control.

Rent control pushed in Maine.

Eviction bans in San Jose.

Eviction bans state wide in California.

Learning how to screen your tenants and work with them is going to be more important than ever in the coming months and years. It is going to get ugly in some places. Stay tuned and seek out folks with common ground.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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2020 Is Over. Now What? Caution, That’s What.

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Wow! What a year. I’m glad to get that behind us. But now what? Where do we real estate investors go from here? To me, it seems that caution is the word to use. 2020 brought a whirlwind of challenges and changes and I’m not so sure we will see them end in 2021.

Here are some thoughts about going forward in 2021.

Covid19 is going to be here for a while longer. That will mean that ours, and everyone else’s businesses will still be affected. Some folks are doing okay. Some are actually doing well. But many any more are hurting. Going forward I expect that things, such as rehabs and repairs, are going to take longer to do. Parts and appliances will be harder to find. People are still going to need some slack. Try to plan accordingly.

Covid19 has also generated a lot of economic uncertainty. People are nervous about the future and unsure of what to do. You can include myself in that category. Remember that in uncertain time cash is always king! Best to have some cash reserves on hand. The more the better.

Newly printed cash is flowing into the economy. This cash is in part, making its way into the real estate market because people are uncertain about where else to put it. Real estate prices are frothy and supply is low as people move to what they perceive are greener pastures. Buy cautiously right now. Remember that cash flow is especially important in frothy times. When the music stops, and it will at some point, you do not want to be the one left standing. Cash flow will help you to remain standing.

That said, it is a seller’s market. If you have been considering selling any of your real estate holdings now is the time. Prices are high and as long as the newly printed cash keeps flowing, they will likely go higher. How much higher? Who knows. Do not be greedy and try to time the top. You can’t. If you want to sell, just put it on the market now.

Furthermore, if you want to keep holding, money is cheap now and every attempt will be made to keep it cheap. Try to lock in some long term debt at these these decades low rates. Convert short term debt into long term debt now if you can, while the money is flowing.

Or, just get rid of the debt, perhaps by selling some properties and paying off others. The future is uncertain and how all of this money pumping and debt forbearance is going to unwind is anybody’s guess. It may not be pretty. Why not be the one who is holding hard assets free and clear?

Increasing amounts of landlord regulations are here to stay. The eviction moratoriums and other measures put in place due to covid19 may be rolled back some. But history shows when regulations are ratcheted up, they rarely if ever go back to where they were before. Again, how does all of this unwind politically? Will there be rent strikes? Are no-fault evictions a thing of the past? Who knows. But I bet it will be to the smaller landlord’s disadvantage.

The multi-family market is being over built. There are so many apartments going up around me here in Memphis and I simply do not know who is going to absorb all of that supply. The supply of new units is going to put pressure on rents and even with all of the money being pumped into the economy they could begin to slip down. Keep that in mind when looking at the future performance of your existing holdings or anything you are considering for purchase.

I guess the buzzword from me for the beginning of 2021 for landlords is caution. The market is high and the future is uncertain. The money pumping can’t last forever without consequences, and there will be consequences when the pumping stops. I sat on the sidelines watching during the last frothy period in 2008, maybe that is the right place to be in 2021.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Tightening The Ratchet

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Headlines around the world are currently predicting another covid related crisis. This time it is an evictions crisis. As courts reopen and landlords are once again allowed to enforce their leases and property rights, evictions, it is said are going to throw hundreds of thousands into the streets. The homeless will be everywhere, from New York and across America, to London and Toronto.

Will hundreds of thousands of evictions be filed? Maybe. Will every single one of them proceed to an actual set out? Doubtful. In our company’s experience, most eviction cases are worked out before they ever get to court. Tenants start paying again work outs are made or tenants move on to somewhere else.

Yes, some folks are having a hard time paying the rent these days, we have seen it in our business. We have had to work with some tenants and let others move on because they simply could not afford their apartment after a job loss. But most tenants are keeping up with their side of the deal. In fact, stats from around the country show that above 85% are paying their rent and that number is only slightly below what was collected a year ago before all of this covid mess began. These states and my own anecdotal evidence make an eviction crisis appear to be far from imminent.

Nevertheless, the press is touting that a crisis of evictions is looming. As a result, my guess is that politicians are going to use this as an opportunity to respond. How? They will respond in two ways. First, where they can they will extend eviction moratoriums. Just keep the courts closed and problem solved.

Landlords, knowing that they do not have the courts to aid them, will in response elevate their screening methods and techniques. Landlords will work harder to keep potential deadbeat tenants out so that the need to go to eviction court declines.

This increased scrutiny by landlords toward potential tenants will lead the politicians to their second response, they will go after screening techniques. They will make the connection between lack of court enforcement and the increased screening done as a result. Politicians will then claim that landlords are denying people adequate housing. They will move to solve a problem which they created in the first place by closing the courts. They will make it harder for you to screen by expanding the scope of protected classes for example. Or they will work to ban screening techniques such as criminal background checks with “Ban the Box” initiatives.

The covid crisis has and will allow politicians to turn the ratchet tighter on landlords. Even when the crisis subsides, do not expect things to be completely loosened and returned to where they were. History shows that once tightened, things are never again loosened completely.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Where Do I Put My Money?

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With all of the uncertainty in the country and the economy right now, “Where do I put my money?” is a question that I am hearing more frequently. People are nervous and are looking for a safe and stable place to park their hard earned funds. As a real estate investor you should strive to be that “safe and stable” place.

If you want to increase the size of your real estate portfolio, and are not independently wealthy, you will need funds. Funds from commonly known sources such as a mortgage broker or commercial bank can quickly dry up, be pulled, or come with too many strings attached. Borrowing funds from everyday people like you and me can and should be a key tool in your real estate investing tool box.

The thing is however many people do not realize nor understand that they can lend their money to individuals and have it backed by the security of real estate. They believe that the stock market, bonds or a money market account are the only options available. A stock broker is where they will turn for advice and you can rest assured that the broker will not tell them about the private lending option.

You have to be ready to tell them about the safe and stable private lending option. But how? You can potentially run afoul of securities law if you advertise or actively solicit private funds. So that option is out. You best bet is to be ready when you sense an opportunity. Be ready when someone asks the question “Where do I put my money?”

When you hear that question, answer with “Why not invest with me, earn a nice return and be secured by real estate?” Most will be intrigued but skeptical. You will most likely have to overcome that skepticism and honestly, that can be difficult to do.

Start overcoming it by sounding and acting confident about what you do. Have a succinct elevator speech rehearsed. If you get a bite, be ready with examples and numbers. Of course this all will take some homework on your part. You have to understand your market, your needs, your business and how financing works.

You also have to practice what you intend to say. Do not try to sound pushy, overbearing or too sales like. You want the conversation to flow naturally. You want you potential lender to feel at ease.

Then be ready to follow up with documentation. Be prepared to demonstrate the safety and stability of investing with you, because very few are simply going to take your word for it. If they do you likely do not want them as investors anyway. Be prepared to show actual property examples if you can. Be prepared with an electronic bank book, already prepared and uploaded into Dropbox so that all you need for them to do is click on a link.. Be prepared with sample documents that demonstrate how their money will be secured. Have a sample note and deed of trust, drawn by an attorney, for them to review.

Finally, give them time to make a decision. They will likely have questions. Do your best to answer them and be honest if you do not know something. And never underestimate who has money. Remember Sam Walton, the founder of Wal-Mart, drove a beat up, old pick-up truck. Do not feel too upset if your offer is not accepted. Some simply cannot wrap their heads around private lending. Move on. Others will give you a test run. Use that test run wisely as it could turn into something really great for your business growth.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Adjusting To Covid

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There were hopes just a few weeks ago that the worst of the covid-19 pandemic were behind us. Now, as of early July it appears that the virus is going to stick around for a while longer. While no one seems sure what the future holds, I can say that our landlording business has been adjusting to covid and that many of those adjustments may be here to stay.

Social Distancing Is The New Way To Conduct Business

We are all being advised from multiple sources to keep our social distance, especially between people that you do not know. For our business (and many others) social distancing has meant shutting our office down and going as remote as possible. Having actual daily contact with employees or contractors is simply not advised. Tenants are no longer provided the option of dropping off rent checks or asking for a repair in person. All of that is now handled online without contact. We work from home. Our employee works from home. Rents are collected electronically (mostly) and repair orders are handled through our property management software. Face to face office contact has been cut to signing a few checks.

Taking Precautions

We have instituted many covid precautions. Our contractors are now required to wear masks when going in a tenant’s home, no exceptions. They are also required to social distance as much as possible and wash their hands frequently as well as thoroughly clean up after themselves. We have not stopped making repairs or attending to our tenant’s needs, but we are prioritizing repairs based on a perceived risk and trying our best to mitigate that risk for both our tenants and contractors. I’m sure new policies and procedures will evolve as we all learn more about the virus.

Business Does Go On

Business does however have to go on some how. Showings to perspective tenants, lease signings, move ins and move outs still happen. Some contact is just going to be unavoidable. However, the risk of contact can be reduced. Before showing a property these days, perspective tenants are screened a bit more than they were pre-covid. We are making sure that they really do need to move in the near future (and are not just being lookie lous) and that they have the means to afford the property before we will show it to them. These days we pre-qualify applicants, open the property up for them, step back, let them look, ask them not to touch anything, wipe it down when they are finished and conduct further discussions outside.

We have also stopped showing occupied properties. If a tenant has not yet moved, we do not want to have strangers tromping through their home. We have videos of most of our properties that can be reviewed online.  Otherwise applicants just have to wait until the property is vacant. Again it is all about keeping contact between people to a minimum. This does hurt our property turnaround time a bit, but it is a necessary caution.

What About The Numbers?

Rents have not really declined and have instead been holding fairly steady. After a relatively calm period during the first few months of the covid pandemic we have seen a small uptick in tenant turnover. Some tenants are telling us they simply cannot afford it anymore and are moving back home. However, we have generally been able to re-rent these properties without too much hassle and without discounting the price. Over all, despite the social distancing and economic slowdown, business has been steady.

What About Evictions?

The eviction courts have reopened here in Tennessee but we have not had to go that route as of yet. As I have written before, eviction is something we try to avoid with screening and we are screening even harder as I mentioned previously. We have had to make a couple of workouts with some tenants who were struggling with income losses due to the virus and I think until the economy further adjusts, those types of things are going to continue. The majority of our tenants have been honest with us if they are running into problems and we have worked with them to find a solution that works best for everyone.

All in all the major adjustment is simply not seeing folks as often as we did in the past. Today it is all about keeping contact to a minimum. I’m not sure how easy all of this would have been a couple of decades ago before zoom, Hello Sign and other websites. Thankfully these sites make getting through this pandemic much easier. Yes, we have had to make adjustments and as a small company we have been able to do that. Will, things ever go back to the way they were? I doubt it. In fact, I think our business may be better off in some ways. Time will tell.

What are some changes you have had to make to your business as a landlord? Please share with a comment.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Should I Buy During Covid-19?

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With all of the uncertainty related to the covid virus, real estate investors are asking if it is a smart move to buy properties right now or should they wait until things settle down a bit. It is a good question to ask as the future is not quite as clear as it seemed to be just a few months ago. But, despite all of the uncertainty I would answer yes to the question. Yes, that is, if the property is a good cash flowing deal. It is important to remember that real estate investing is all about the numbers, especially the cash flow number. And if the cash flow is positive, then I say buy.

That said, I would add a couple of caveats that investors should consider these days. First, the market for investment properties is pretty frothy right now. Everyone is chasing investment real estate. I have had more people ask me about real estate investing and how to get into it recently than I ever have in the past. Prices are high right now. I am seeing prices for properties here in the Memphis area that I never thought I would see. But then again rents are up as well and investors are pushing into different markets and different parts of town. How long will this party last? Who knows.

Second, a pandemic can definitely affect both prices and cash flow. Obviously, if everyone is locked down and economically suppressed, or even worse become sick and die, then demand is going to slow significantly driving prices and rents down. Plus the pandemic, or at least the fear of it, may cause people to rethink where they want to live, thus affecting market values. People may no longer want to live in a downtown high rise, clustered among several of their “closest” friends. People may opt for perceived safer spaces in the suburbs or in smaller duplex type properties. What the future holds in this respect is not quite known as we are still, as a society, trying to determine exactly how and if this virus will affect us. In fact, some larger investors are already betting on this move to suburbia.

One thing for sure, the future is uncertain and it is hard to plan. So much has happened in recent months and their long term effects on the real estate market remain to be seen. The bottom line however is still all about cash flow. A real estate investor simply must have positive cash flow to be successful. But how does one calculate future cash flow during these uncertain times? Can you continue to plan on increasing prices and rents? When will the music stop and who will be left holding the bag? It really is hard to know right now.

At the very least, investors have to think that they are perhaps seeing the top of the market and become a bit more conservative with their future rent and price projections. I might also utilize a “covid discount” in my asking price to try to mitigate potential future risk. Will I acquire the properties with such a discount? Maybe, maybe not. But then again I was overbid on many properties in 2008 and 2009 only to pick them up at a later date when the music finally did stop.

Keep a close watch on your market. Watch the trends and keep an ear to the ground. And always, always, listen to your numbers. If the future cash flow appears to be in positive territory, even with all of the uncertainty, then by all means go for it.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Landlords – Aim For Stability

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There is a lot going on in the world right now. The stability we had just six months ago seems to have completely evaporated. Covid is still out there with all of its economic issues and now there is social and political unrest. How long will it all go on? Will things flare up again? Will they get worse? Will the November elections bring relief or more issues. Things look pretty uncertain right now. It is difficult to say when we all might return to some sense of stability.

We landlords, despite all that is going around us, can and should aim for stability in our our lives and within our own businesses. We have to. We have to strive to be a stream of calm in the chaos. It is simply the best way forward. What can you do to aim for stability? Here are some thoughts.

Know What You Can Control – We cannot control everything around us. Understanding that is the first step. Knowing what we can and cannot control will lead us to examine what we can control.  We can, for example, control our expenses. We can also control the management of our properties. We can control who we let live in our properties and perhaps most importantly, we can control ourselves.

Control, or even just the appearance of it, is something that may appeal to many people right now. Aiming for stability by controlling what you can may attract better tenants, keep your good ones from moving on, and present a well run operation.

Work With Your Tenants – One major disruptor to our businesses is tenant turnover. To aim for stability you need to work hard at heading off this disruptor. The last thing any of us landlords need right now is a bunch of tenant turnover. Turnover is expensive and leads to unpredictability.

Consider if you would rather have a vacant unit right now? Will you be able to find a new tenant? Will these new tenants meet your qualifications?

Working with your tenants, talking to them, even helping them if need be, is a smart strategy these days. It allows you to work with what you know and keep some stability in your world.

Focus Your Limited Resources – Now is a good time to go over your budget with a fine tooth comb. Where can you trim a little? Are there items that you have forgotten about or let go a bit too long and do not use anymore. Can you find better rates? Can you find better service? Now is a good time to put your limited resources towards better management to aim for stability.

Keep Some Cash – Nothing can get one through a difficult time like cash. Yes, keep some in the bank but also keep some at home. ATMs may be disabled and banks may be closed due to civil unrest or economic conditions. You just never know. If you need to make repairs and cannot get access to your money for whatever reason, then you are adding instability to your business.

Keep Your Cool – When you lose your cool it’s over. No matter who you loose it with, be it your tenants, your lender, your contractors or the whole world, its over. You have to be the level headed person in these uncertain times to achieve stability. Be the reasonable one. Seek to understand and find solutions.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Eviction Court Closed? Cash Can Persuade

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Eviction courts in many states are closed right now. Here in Tennessee the State Supreme Court has halted evictions until the end of May. This hold was deemed necessary because so many have lost their jobs or been otherwise impacted by the great supression. However, the closing eviction courts has also provided an incentive for some to simply not pay the rent and forced landlords into a bit of a corner.

But without the courts behind you, what can you do?

You do have options. You cannot use force, but you can certainly try to persuade. Evictions are costly and confrontational anyway. They create animosity and leave a potentially very angry person in control of a vary valuable and easily damaged asset. In over 15 years in the landlording business we have only been to eviction court three times. Instead, we prefer to use the power of persuasion and the power of cash. Sure, force may feel better at the moment the judge rules in your favor, but trust me, the hidden costs are always there and will make themselves known before you actually do get that tenant out.

The persuasive method I am referring to here is of course cash for keys and since I have written about that before I will not get into too much detail about it here. Suffice it to say that instead of using force, you pay your deadbeat tenant cash to leave and hand you the keys. We have successfully used this technique many times over the years and it is a very good option to use in these evictionless times.

Yes, I understand that it hurts the pride a bit to actually pay a deadbeat tenant, but that hit to the pride is a lot less painful in my experience than the expense and stress of an eviction and setout. Plus, what other option do you have right now? None.

How much cash should you pay for the keys? Depends on your situation, market and circumstances. You need to ask yourself how valuable it is to you to get the tenant out. How much rent are you losing? How behind are they? What will they take to leave? How stressful is it to you? There are many factors to consider but a few hundred dollars often does the trick.

Make your tenant an offer and see where it goes. Start low. Consider making an all cash offer or perhaps including a moving van or something else they want. It is up to you to be creative in these interesting times.

When pursuing the cash for keys option there are two “should haves” and one absolute “must have” for the landlord.

First, there has to be a certain date when the tenant agrees that they will be out. Of course you can always give a day or two leeway if you see that effort is being made but you have to have a set date. If they do not move by that date, they do not get paid.

Second, we insist that every piece of furniture, belonging and trash, down to the wire hangers in the closet and the Taco Bell sauce packets in the kitchen drawers, are removed and the place is broom swept clean. The last thing you want is to pay a tenant to leave and then have to pay someone else to remove their unwanted, stained sleeper sofa and other garbage.

On the “must have” side, you must get a signed release of the rights of possession form. Download one here. This form is a must because your tenant has to return legal possession of the property to you. You need something to show a judge, if it ever comes to that, that you have received legal possession from the tenant and that they have removed all of their belongings. DO NOT hand them the cash or take the keys until you have that signed form in your hands. If they will not sign, then no deal.

The courts will reopen someday. In fact, as I write this, Texas already has. You can make that known to your tenant and tell them that your offer will be much better than the one the receive in eviction court. Cash for keys might just therefore solve your problem.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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Plan For The Future

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I wrote last time about the current difficulties planning for the future during the great covid suppression. There are just so many unknowns right now that planning anything is tough. But, even in the worst of times (which we are no where near) we entrepreneurs have to try to do some forward thinking. We have to thoughtfully consider what may lie ahead and what we could do to both grow our business and survive. Here some of my thoughts.

Of course, current thinking is going to revolve around the covid virus along with government’s and society’s response to it. What we are all experiencing is simply unprecedented in our lifetimes. For example:

  • Unemployment is likely above 20%.
  • Many small business will never reopen again.
  • Several large business will file for bankruptcy.
  • GDP has declined by almost 5% here in the US.
  • The Federal Reserve is creating a lot of money out of thin air.
  • Lenders have significantly tightened their standards or are not lending.
  • Calls for rent strikes and government intervention continue.
  • There does not seem to be any good way out of all of this.

What does this mean for landlords, or for any other business for that matter?

  • It is going to take a lot longer to get through this than we had all thought or hoped. There will likely not be any quick recovery.
  • Things are going to get more costly due to inflation.
  • Calls for regulation and other government interference will grow as the crisis continues.
  • Some of the regulation and government interference that was inspired by covid will never go away. The level of regulations will never go back to what they were.
  • Taxes of all sorts are going to increase.
  • Politics is going to become even more divisive.

I hope I am wrong, but the above does not paint a very optimistic picture. Now, I am not saying we are headed towards a dystopia, but believing that impacts will be minimal and contained or that “this time it’s different” are I think, misguided.

So what to do? What do we plan for?

First, I would think about items that you can control in your business. What expenses, people and resources can you as the business owner control? Some expenses such as maintenance are directly under your control. Others like taxes and mortgage payments come with steep consequences if not paid. When you think about it, there is often not many expenses in our businesses (or any business) that can be easily cut without dire consequences. Knowing that, I would carefully consider adding any new expenses or expanding significantly until things become a bit clearer.

If you have employees or contractors, you may have some hard choices in the near future as these expense items are often some of the largest expenses a business has and has control over. Is it wise to cut employees or farm services out to professional managers at this time? Maybe. Again however I think having direct control and access to employees and these types of resources may make our business more nimble and better able to weather this crisis.

Secondly, do not take the easy way out. Seek out options in places you have perhaps not done so before. It is can be easy and tempting to simply throw cash at a problem to make it go away, but that may drain needed reserves too quickly. I think we are all going to have to work harder in the near future to trim costs, search for the best prices and prioritize projects.

Third, consider that your tenants may have a difficult time paying rent, not pay at all, or move back home with mom and dad. How will that affect your business? What would a 10%, 20% 30% drop in revenue mean for you? What are the actual numbers? How would you survive that drop? Could you make enough cuts in expenses? If not, what are your options? Best to learn what these numbers are and think of possible options now.

Fourth, how could you respond to keep at least some revenue coming in? What would make you stand out in your local market and cause tenants to choose or stay with you over going somewhere else? Could you reduce rents or add some other incentive? How much could you reduce rents? Do you know the numbers? Again, it is best to figure them out now as we may all need to get very creative in the coming months or years.

One thing is for sure, there will be an other side to all of this and most of us will hopefully be there to see it. It just may take a lot longer and be more difficult to get there than we first thought. We may all however need to tighten our belts and get creative to get there. But any plan begins with knowing where you are today and where you hope to be. So beginning with your own numbers today and projecting into tomorrow is a very good place to begin a plan for the future.

Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors.  Subscribe to Smarterlandlording here. Contact Kevin here.

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