Real estate investing is a business. In every way you can imagine.
So today I want to focus on the “customer” – your tenant-customer.
Every so often I get questioned about the way I deal with tenants. Because I have personal interaction with them.
And even though real estate investing is a business, some investors believe it should be ALL business.
I’m not so sure.
My father grew his business by treating his customers like they were friends.
I did the same when I built my mail-order company.
When I moved into the real estate investing business, it has been no different. Why should I change? I treat my tenant-customer like I want to be treated.
Do you know why?
It comes back to me two, three, TEN-X in respect.
Case in point: this week I received a call from a tenant that moved out in October…not long ago. They had been with me for more than two years.
They originally moved because they wanted to buy a home and needed to budget for it. I could not reduce my rent to help.
THAT’S the business part.
But I treated them right – all the way to the end and wished them well. I called them after they moved to see if everything was OK … if they were happy.
In other words, I valued them like a friend.
My former tenant told me they were unhappy with their current situation. I didn’t ask for the details. Then he told me “..you’re one of the best out there – you treated us right”.
Did you get that?
“…you treated us right.”
But this isn’t a post about me. It’s about you. It’s about your tenants and the future of your business success.
I’m not suggesting that profit and cash-flow and all of that is unimportant.
I’m just suggesting that your success in business is directly related to HOW you make people FEEL.
If you are constantly focused on ‘money’, you’ll lose. Money clouds relationships.
And relationships are the core of any business.
I’m challenged sometimes about being too connected with my tenants. Because I meet them – I don’t just drop it on the property manager’s lap and sit back to collect cheques.
I drop by to say ‘hi’ when I’m in the area (looking for more properties). I bring them gifts and send them birthday cards.
Sometimes (oh GAWD say it isn’t so…) I won’t increase their rent – I’ll miss out on an extra 50$.
In my opinion, if 50 dollars is going to make or break me, I shouldn’t be in this business.
That doesn’t mean I NEVER increase my rents. I’m just grateful for having people respect my property and respect me – so I give ’em a break once in a while.
Plus, they prob’ly need that 50$ more than I do.
How does it feel when someone gives YOU a break?
Yea, I thought so.
Back to my former tenant. He’s asked if I have another home for them. They are willing to work with me if they find a home that could qualify for rent to own.
How’s that for respect?
This is the “business” success I’m talking about.
I know so many investors that go through tenants like water. I may be one of the lucky ones, but I’ve had very little turnover in my units.
I think it has something with the way I treat them.
“But Joe, you must get some bad tenants sometimes”
Yup…I’d be lying if I told you anything else. No “system” is perfect.
We have to realize there are just bad people out there. The only intent they have is to take advantage of you from day one.
So, like a businessman, I prepare for someone who is going to “steal” from me. If you owned a grocery store, you know someone’s in the fruit isle chomping down some free cherries once in a while.
But I’ve always lived by the rule: “if someone is going to screw you anyway – get it out of the way as soon as you can.”
I do that by trusting them right away – when people believe they are smarter than you, they let their guard down quicker – their true colors show sooner rather than later”
That way, the end result (getting screwed) is still the same, but it doesn’t take years to happen.
It’s such a great psychological ‘trick’ 😉 !
Believe me – tenants have taken advantage of me. But the good ones outweigh the bad ones.
And if you’re wondering … yes… at this time of year I STILL send Christmas gifts to the bad ones … the ones who are not paying rent and so on.
I’ll bet you create more friends and earn more respect from your customers / tenants / colleagues this way than if you go through your life with your guard up.
Call me crazy.
Merry Christmas my friends!
– Joey