Please note that this post is an excerpt of the webinar hosted by our sister company, The Landlord Code, where our co-founders coach DIY landlords how to avoid problem tenants and maximize rental profitability. Get access to more training like this in our (free!) private Facebook group HERE.
This is episode one of our Summer Series Landlord one-on-one, taking you back to basics. And for those of you who don’t know us, we are the co-founders of The Landlord Code, a landlord education company and Foundation Homes, property management, where we do hands-on property management. We’re in over a billion dollars worth of business. We got a less than 1% eviction rate. We’ve got an aspiring hired man over here. We’ve got someone very passionate about natural wines right here. So that’s a little bit about it. And the reason why we’re taking back to basics is because we understand that ultimately out of being a landlord, you want more profit, you want less risk and let’s face it. We all want more fun, more fun. But before we get into what we’re going to talk about today, I just want to let you know that it wasn’t always easy. We didn’t always have these awesome stats that were spitting out.
There was a time, not that long ago, where I was in position, where I wasn’t prepared and it literally costs us a hundred thousand dollars. And just imagine for a minute that you have a new baby in your house, we have a new baby and the baby was six months olds, our first daughter. And I have I’m like, everything was going fine. I thought in our business, everything with no hiccups, things were rolling. My life was good. And then I got a letter from the department of real estate and it changed my life for literally 18 months. And what happened is that I left literally, as a result of that letter, it cost me hundreds of thousands of dollars. I had to get deeply involved with the bureau of real estate hire professionals, attorneys, and I gained 20 pounds. I probably drank way more than I should have. I was not getting any rest and my life was chaos. But out of all of that, a Phoenix rose from the ashes, no out of all of that and probably was the biggest, most expensive best mistake of my life. Because out of all that we gained the experience.
We gained the knowledge, we learn how to get the systems. And while I, at one point when I wanted to quit, I didn’t, I dug deep and we changed our business, which changed our life. And we want to show you how to do that for yourself. Yeah. So here’s What we did. We took what was the chaos of property management. We put PR procedures and we put strategy into our property management portfolio. And one of the biggest mistakes we see DIY landlords make is they do what Christopher’s sky diving instructor did at the beginning of the show. And they did what we were doing. You go into it and it’s just rapid fire. And you’re just reacting. There’s no strategy, there’s no process. And there’s no planning. So that’s the theory.
That’s the theme for this summer, our Summer Series Landlord, one-on-one back to basics. We want to take you back to the fundamentals so that no matter where you are in your landlord journey, whether you are just buying your first investment property, whether you’re 20 years in and looking for solutions or whether you’re just considering whether you’re turning your primary home into a rental, we want to give you the strategies this summer that’ll help you set things up and set that foundational core. So the first thing you want to ask yourself, when you get into this is the best question is really what’s the result. What’s the outcome I want out of being a landlord, right? And oftentimes landlords come to us and say, well, what is it?
I want money. I want mine who doesn’t want money. We all want my, well, I’ll make it rain on a regular basis. We all want money, but really what they’re talking about as well, freedom, freedom people Want you get into the landlord business so that you can build the ultimate wealth, which is personal freedom, freedom of space, freedom of time. You want assets working for you. And honestly, what we find most people just want to know is that they’re doing the right thing, right? That they made a smart financial decision in setting Up their family. There’s a lot of naysayers out there. A lot of us kids say haters, haters, who are going to be asking you why you did this?
Why are you spending money? What are you doing with yourself? What do you do with your life? Mom, mom, that’s all I had a mental break, but listen, they’re going to be out there. And you want to know that you’re doing the right thing. And let me tell you, you are, you got off the bench and you’re in this game, but you need to have the right team and not have the right team. And so you can have all this. You can have that bigger pockets, dream, the landlord toes in the same pina colada in hand, making money, while you sleep, you can have all that. The financial freedom, the personal freedom, if you have the right process. And if you have the right team, which is what we’re talking about today, so let’s get into it. So we gotta, we gotta break some anchors. We’ve gotta get rid of some anchors. And the first anchor that I want people to just consider dropping right now is that you and your rental business are not worth the financial investment for specialists. What I mean by that is that oftentimes people will get into this and say, oh, I’ve got a guy that can handle this. If I have a problem, I’ve got a corporate attorney or my, my, my sister’s an attorney. Well, I’ll just get my, my, my brother-in-law had run my books for her, right.
Or my neighbor down the street. He’s a landlord. So he can give me some advice or I’ll just call my agent who sells property. Who’s got nothing to do with property management. I’ll just call this person. If I have any questions, what we find is that’s an old belief that landlords often enter into the landlord business with and carry with them. But here’s the new belief. You are worth it. Your property is worth it. Your property is a business. And if you set your rental business up like a business, you will be the one to experience that ultimate personal and financial freedom. Absolutely. And just consider this, that anybody who’s running successful businesses, and you can see they’re out there all over the place.
They all have specialists on their team and let’s just face it. Teamwork makes the dream work, right? So it’s cliche. Could you give us another, can we get another, I know I haven’t, I haven’t watched Sesame street today, so I know that it’s teamwork makes the dream work is a big thing on Sesame street, but it can also be working for you. You want to have the right team. You want to create your dream team to essentially take your business to the next level. And today we’re going to be talking about the foundational team, which are so let’s start with the first one. First one, the first person you are going to want on your foundational team for your landlord business is the right landlord tenant attorney. Now notice what I said there, the right landlord tenant attorney, His husband, Bob he’s at a divorce or the attorney. Oh, that Sounds like Bob sounds like a good guy to know James. He’s a, he’s a injury attorney. Oh, well an injury attorney that should help me with my Rental and Sam down the street. He works with me and we’ve got this corporate attorney we could totally use for everything.
We will tell you, we literally see this day to day in our business. We see clients say, we don’t need an attorney because we’ve got this fill in the blank attorney. But what they don’t have is the landlord tenant attorney. Now why Christopher might someone need a landlord tenant attorney versus any other old, very well-educated and equally expensive attorney on their team. I really feel like I should know this answer because now you’re putting me on the spot. But no, but I’m just because a landlord and tenant attorney is going to know the answers to real estate questions. If they’re in your market or in your area, they’re going to know specific language in specific. I have a specific understanding around legislation. That’s specific to your area, not just your state or county. I mean, what we’re seeing throughout the U S is so much change in the landlord tenant law. And it’s not just by state it’s. I mean, sometimes it’s regulated on the national level, right? It’s always regulated on the state level and it’s even more specifically regulated on a town or a county Basis. And just to put it in perspective,our county has five different areas that have different legislation needs County only has a small Or small county, but also if something comes up around the lease contract or I mean even fair housing, a landlord tenant, attorney’s going to know how to approach that. If a tenant wants to put some language into a lease, or you want to put language into lease, you want to know that it’s legal. It’s, you’re getting The advice from someone who knows the ins and outs of the actual landlord tenant law in your specific area. So if you go to your MNA attorney, right, that maybe your company provides as a resource. They can answer legal questions, and tell you whether or not you can put your home on the market while it’s currently tenant occupied. And what the notice requirements may be for said tenant. And if that tenant is any particular protected class, so your realtor can’t tell you that and they may get you into trouble if they don’t know to ask the right questions, because realtors go to real estate attorneys, they don’t go to landlord tenant attorneys, right?
On your team, you need to make sure that you are not just dialing out of the phone book. When a problem arises. As you were setting up your rental business and setting up your foundational core team, you want to find a great landlord tenant attorney. And if you don’t know where to find one, call a few property management companies in your area And ask who they recommend, and then ask when you find a resource that makes sense to you ask them questions. Like how have you dealt with tenant landlord issues? Have you dealt with anything around contracts? How many of those have you dealt with over the years?
And they’ve dealt with a lot of them, that’s probably a good person to have on your team. I’m Also going to add what we see in the San Francisco area is we see attorneys who specialize more in working with landlords and then attorneys who specialize more in working with tenants. So you obviously, as a landlord, want to find one, those that’s a little more of a landlord Friendly. Absolutely. Absolutely. Yeah. So the next person you want to have on your team is a great CPA and not just every CPA, any CPA, but the CPA that specializes in working with landlords and investors.
Our team will then talk to their CPA, who is making very basic mistakes. When it comes to things like how the taxes need to be withheld in our state, on reporting rent or for clients even who are out of the country, which is a big deal, wherever you are, the proper tax is not being withheld. So you get in trouble with the franchise tax board and the IRS. We see these mistakes and they’re innocent mistakes, these CPAs, meanwhile, but they do not know the ins and outs of what it means to own rental property in the area. In addition, they’re not providing our clients strategies to help them save money and actually make money with tax deductions, deferments, depreciation, against capital improvements, those types of things. So we have a CPA that we work with, a specializes in this. He actually did a teaching with us, not that long ago. And he opened our eyes wide open to some of the great strategies that you can employ to actually put more money in your pocket and actually allow you to plan for the future and be strategic with your business. And that’s ultimately what we want for you guys, Right?
So if you want to maximize the money that you get from your rent, you want to keep uncle Sam out of your pockets and you want to stay out of legal tax trouble, right? You as a landlord need to find a CPA who is experienced and well-versed in working with landlords. So I would suggest asking questions like how many landlords, how many investors do you have in your portfolio?
What strategies have you given to these other landlords? We would like to suggest that you consider digging a little deeper and finding a CPA who says definitively yes. I work with landlords. Yes. I’ve got strategies. And yes, I understand some of the more nuanced tax considerations that landlords here in the us and in particular state by state, right? Like in California, where we are, they’re a specialist.
We see this mistake in our day-to-day business, where landlords, especially as you get into more complicated financial pictures, high net worth individuals, maybe owning multiple properties or multiple business interests, your insurance needs are going to vary. So there’s a lot of high-end insurance agencies, right? Like Chubb is one of them out there where they kind of just don’t want to deal with like landlord tenant insurance. But if you’re not asking the questions, you’re not going to know the answers. And sometimes a significant umbrella policy, like something that Chubb would write would be significant. But other times, if you don’t talk to an insurance agent who understands the ins and outs of landlord insurance policies and what writers and what policies may be available to you, you could miss out on some awesome protections like eviction protection, a lot costs covered for like attorney’s costs, lost rent, there’s so many different policies. A good insurance agent who knows the insight ins and outs of this is going to excite you with their knowledge and what they can do for you to make sure that you’re protected. Long-term because this is a rental business. This is a legacy business for you is the long-term business. And you want to have the right people in place.
We are actually bringing an example of all of these resources on this summer during the summer series. So we’ll be bringing on an attorney to talk about Fair Housing. And we’re going to bring on a tenant’s attorney to talk about how he sues landlords and property management companies for the careless mistakes. They make this guy loves to talk about how much money he makes from doing that. So we’re bringing him on, we’re going to bring on our CPA, our landlord, attorney CPA. And we’re going to bring on at least one insurance agent to talk about some slip and fall incidences where landlords could have been better covered.
If you’re in California, we can offer these referrals to you and give you their name. If you are out of California, they’ll give you a lot of insight to ask better questions and the better questions you get, better results and better outcome. The last piece of this foundational element is having a peer group. A peer group is very important. One of the biggest reasons why a pure group landlord peer group is important is because being a landlord can frankly be really lonely and isolating unless your, your, your family or your brothers and sisters, or your friends also in rental properties. They’re notgoing to understand the language that you’re speaking. They’re not gonna understand the pains that you’re going through. They’re not going to be able to give you the right insight or advice to help you be successful. They’re going to pat you on the back, give you a hug, tell you it’s okay. Or maybe tell you something that you don’t want to hear. So the old belief that we see a lot of landlords making a mistake, we see them making is I can just Google everything online. It’s not that big a deal. Being a landlord is it’s Easy. County-wide what you need is a group of like-minded individuals who understand the commitment to education and understand the difference between getting an answer online, because there’s plenty of free forums and we’ve done entire episodes on this that we call bad answers to good questions. You never know who is on the other end of that forum answering your question. How do you know what experience they have? What training they have, what state they’re in. We see so many bad answers out there that will get landlords sued in a worst case. Scenario lose you tens of thousands or hundreds of thousands of dollars. So it was important to get the right advice from people who know what they’re talking about versus crowdsourcing from people who may not be the most educated specifically for your need.
This could really negatively impact your bottom line and set you back months and months or even years with the profitability of a rental business, right? So There are a lot of different ways you can do this. You can join a local landlord association, even if you’re in a really small town in whatever the largest town over there will be. Some sort landlord association where you will get access to other individuals where you can network and ask questions. There’s also usually statewide associations. Now that may not be as like face-to-face or getting to talk to people, but a statewide association is going to get you access to good information and usually should come with a forum and some kind of resources probably that would help you also identify a lot of the resources we talked about today. State Apartment Associations, have these awesome associations and they provide you with not only bulletins on new things that are coming up, but also resources for you when you have questions. A
Imagine if you had a place to go where you have, or imagine you had an investment property, right? You have four or five of them, and now you’ve replaced your rental income and you can do this from anywhere you want. You have no stress and you’re making money. That’s the landlord dream, right? The toes in the sand, pina colada in hand, that’s the dream that most of us who get into being a landlord ultimately have. Right? And what if you had the right peer group to kind of guide you down that path and be better, You had the peer group. If you had a roadmap, if you had someone guiding you along the way so that you could have confidence as you encounter all these different problems and different scenarios, because there are a million of them, we run the show once a week. We would never, in 20 years be able to cover every single topic that would possibly come up. So you need a peer group. What if you had this peer group that could help guide you through these different steps and through these different issues as they come up. It just so happens that the landlord code is opening up a membership today was going to be launching in July.
We’re going to be launching in July, and this has been specifically designed to help take the stress out of being a landlord. We’ve taken all the information and all the data and all the insights and all the lessons that we’ve learned, all the money, the dummy taxes that we paid, and we’ve basically honed it down and we’re going to deliver you in a nice package. So you don’t have to deal with any of that stuff.
Beta launch July 1st, just for people in our network. And here’s, what’s going to be in the membership. It’s a monthly membership. You’re going to get access to a private Facebook group where we will be doing specific coaching. We’ll be doing a once a week. We’re calling it Coffee with Christopher. We’re also going to do a once a month deep dive with one of the experts like we’ve talked about today, where you will get access to this expert, to be able to ask your questions. And this is where we’re really going to be able to help you elevate your landlord business to the next level. We’re also going to have a private podcast and private trainings. So a lot of, of features available for you guys. And when we opened this to the public in the fall, the price is going to be $149 per month.
On episode two of the summer series, we are talking about how to spot a rental deal. And who do you need on your side to be able to find that unicorn of a rental dealer that will make you money while you sleep and building that team up.