How I Went from 200+ Tenant Telephone Calls to 1 Per 12 months

Henry:
That is the BiggerPockets Podcast present quantity 784. Look, I did it. I nailed the fingers on the primary attempt. Take that David Greene. So for reference, what you’re saying is within the final 12 months, you had 218 calls from tenants round points or potential points at a property. And of these 218 calls, you solely needed to speak to somebody one time.

Pasha:
Right.

Henry:
I might say the system works.

Pasha:
Thanks. Or possibly I’m simply tremendous fortunate. I don’t know.

Henry:
I’m taking up the BiggerPockets Podcast in the present day and I’ve the pleasure of interviewing my good pal, my accomplice, my scholar, Mr. Pasha Maleknia. Pasha’s bought a complicated diploma in data techniques. He’s right here to show you the right way to construct techniques that prevent money and time. Pasha, we all know you like board video games. So what would you say is extra enjoyable, studying a brand new board sport or constructing a brand new system?

Pasha:
You’re making it so arduous. I might say constructing a brand new system. I similar to to problem and simply the problem of it. After all you’re a nerd.

Henry:
So why must you stick round for this episode? We’re going to be dispelling some myths round system. We’re going to speak about why you’re most likely already spending time on techniques with out even figuring out it. Your techniques most likely simply aren’t that nice but. We’re going to speak concerning the money and time techniques can prevent, the money and time it saved me, the money and time it’s saved Pasha. And so in case you are a newbie, it is a good spot to be as a result of you may set your small business up for development within the long-term. And in case you’re an skilled investor, you must stick round and pay attention as a result of we’re going to speak about issues that might doubtlessly put more cash in your pocket and likewise show you how to handle your tenants with out you having to spend a lot time addressing these points your self. All proper, so Pasha’s right here with me. He desires to tackle the introduction of the fast tip for me. So in the present day we’re going to maneuver into the-

Pasha:
Fast tip.

Henry:
At this time’s fast tip is go to biggerpockets.com/assets. There you may obtain Pasha’s instance spreadsheet of how one can implement a system and jumpstart constructing techniques in your personal enterprise. Thanks Pasha for sharing that with us. It’s a brilliant cool instrument. You’ll truly get to see a bit of it in case you’re watching this model of the podcast otherwise you’ll hear me clarify what that system spreadsheet is and the way he makes use of it in his enterprise. So thanks for sharing that with us.

Pasha:
Completely a pleasure.

Henry:
All proper, let’s get into the interview with Pasha. All proper everyone, let’s welcome Pasha Maleknia again to the present.

Pasha:
All proper, thanks. Thanks, Henry, for having me.

Henry:
Superior, man. So for a bit little bit of background, we lately had Pasha on an episode, episode 773, the place he shared his unbelievable story about how he bought into the world of actual property investing and the way he’s taken that begin and catapulted his enterprise. However we form of left with a bit little bit of a cliffhanger. Pasha is an professional on techniques and the right way to save your self money and time with actual property investing and we needed to dive into it, however clearly didn’t have time in that episode. So we introduced him again, particularly on this episode, to dig into techniques, what they’re and the way he implements them and the way you ought to be contemplating and doing the identical factor. As a result of the tremendous secret is everyone already has techniques in place, they most likely simply suck. So let’s speak to Pasha about techniques.
So Pasha, clearly, he’s a pal of mine, he’s a scholar of mine, and he’s a wonderful actual property investor. So I needed to start out off, Pasha, in case you wouldn’t thoughts by let’s dispel some myths round techniques. As a result of at any time when individuals hear the phrase system, I feel generally they assume it’s so much both larger than it’s or dearer than it’s, or that they’re not prepared for techniques of their enterprise but. And I don’t actually imagine any of these issues are true. So let’s discuss a few of these myths after which you may inform us why they’re lacking or in the event that they’re lacking. Perhaps I’m simply utterly mistaken right here.

Pasha:
100%. Let’s do it.

Henry:
So the primary fantasy is that techniques should be complicated. Is that this a fantasy or is that this details?

Pasha:
Completely a fantasy. As , even in larger firms generally there’s a bent to construct complicated techniques and it nearly at all times fireplace backed. I feel the perfect techniques that I’ve encountered are of their easiest type. And also you at all times wish to begin with a quite simple one degree kind of system that works for you after which begin, you may at all times make it extra related to a enterprise or to the problem that you just’re tackling. However I see this so much that individuals begin with an ideal system, a really complicated system as a result of they adore it, however whereas they’re constructing it, they need it to be completely excellent, however it finally ends up with a system that by no means implements.
The best type of techniques are at all times higher as a result of you may at all times get a suggestions and you’ll at all times return and construct it once more and make it a bit bit extra related. There’s a saying that claims: “Your first 5 techniques, at all times going to suck.” So it’s higher to only begin it easy, guarantee that it’s like, perceive why, what’s the drawback, return, repair it. After which as you go ahead it’s going to be extra related to your want. However undoubtedly don’t begin with a posh system.

Henry:
Superior. Man, that’s nice perception as a result of I feel individuals do are likely to overthink techniques. I do know I did and actually most likely nonetheless do in loads of areas of my enterprise. So the second fantasy is that you just want some costly software program after which when you get this piece of software program, that software program system goes to repair all of your issues.

Pasha:
Oh, man, you’re preaching to the choir. Completely a fantasy, completely a fantasy. I’ve mentioned this so much nearly in all of the talks that I’m going to, all of the workshops and the whole lot, individuals attain out and are like, “Okay, what software program do you utilize? What do you utilize for this? What do you utilize for that?” And I at all times clearly inform them the reply, however it’s like lots of people wish to begin from the software program. They assume software program purposes or apps are the techniques, which is 100% mistaken.
Principally you at all times wish to just remember to begin together with your core problems with your small business first, then you definitely stroll that again and then you definitely deal with what system can handle that core concern that I’ve. And then you definitely exit and store for the softwares or purposes for it. An instance I may say goes to Residence Depot and purchase the primary 5 instruments that you just see from the shelf after which return residence and attempt to construct one thing with it. That’s not the way it works. You at all times wish to just remember to deal with a related instrument in your want. And I see this so much, man. They assume they simply want to write down a examine for an enormous fancy software program and so they assume that every one of their issues are going to go away magically. And I at all times inform them that you just’re in for an enormous shock as a result of that’s not going to occur.

Henry:
Superior. Yeah, that’s a good way to have a look at it. Right here’s a enjoyable truth about me. Even when I knew precisely what instrument I wanted to do a job and I walked into Residence Depot and acquired that instrument, I might suck at that job. I’m simply not useful. That’s simply not a skillset that I’ve. And so that you additionally don’t should be useful to be an actual property investor. Perhaps we’ll throw that on the finish of the present, professional tip for you new buyers.
That’s a implausible level as a result of lots of people assume that techniques imply I must go purchase a bit of software program after which I inform the piece of software program, right here’s all of the issues that I do in my enterprise. After which that piece of software program says, superior, that is how you must do these issues and it doesn’t work like that. A system is basically only a set of processes that you just implement systematically time and again and it’s supposed to save lots of you money and time. That may be something. We talked yesterday after we had been discussing this present and also you confirmed me one among your techniques that was actually only a Google Sheet. Everyone has entry to Google Sheets. So it’s not software program you want, it’s processes.

Pasha:
100%. One other factor that I wish to add is we’re on the age of data know-how that it’s the simplest time to construct a software program and you probably have 5 softwares proper now, we’re going to have 20 by the top of subsequent yr, I promise you. And if you wish to simply chase the shiny software program utility, the most recent pattern, man, you’re going to spend some huge cash and also you’re most likely not going to see nice return on that. That’s the place you wish to just remember to at all times begin from the enterprise, you at all times begin your techniques round it, and then you definitely return and begin purchasing for one thing that’s related to yours.

Henry:
The following fantasy that I wish to discuss is, so I’m form of going to skip one right here as a result of I feel we at present already hit at it. Techniques are just for massive companies. Clearly we’ve touched on that. We all know that techniques are meant for any enterprise of any facet, it’s only a course of. However this one I feel is basically vital is that techniques are just for out-of-state buyers.

Pasha:
Once we discuss techniques are just for out of the state, I feel that’s not related as a result of I feel I’m the residing instance of this. We’ve got about 20 models that the majority of them are inside 10 miles radius of the place I dwell, however we form of urge ourselves to guarantee that we by no means step into any of them as a result of we wish to have the liberty of geographical location. We wish to have the ability to be wherever we would like and have the ability to renovate our properties and have the ability to handle all of our properties. We have already got accomplished the administration piece, now we’re centered on constructing our techniques round rehabbing them remotely. If you wish to be extra passive in your small business, I might advocate to start out simply fascinated by constructing the companies that you’ve on a platform that’s scalable and that’s solely doable you probably have a very good system in place. And also you don’t need to be out of the state. You may be as shut as it could possibly get to you, however you simply don’t wish to be the weather that’s the middle of your small business.

Henry:
If I’m listening to you appropriately, what you’re saying is that techniques are supposed to prevent money and time. And who doesn’t wish to save time or cash regardless of the place you’re positioned? However implementing techniques if you find yourself native as properly I might assume offers you an added benefit, proper? Since you’re there within the occasion one thing doesn’t go as deliberate. So it’s simpler to hone your techniques while you’re native since you may be there to hone it. After which when you’ve bought it dialed in, you actually open up nearly this world of enlargement. As a result of in case you’re not tied to the geographic location of the place your properties are, regardless that you’re native, what’s stopping you from selecting a unique market and increasing your small business since you see a possibility in a brand new market and now you’re not held again by geographic location? So I feel that’s an outstanding method to have a look at issues.

Pasha:
100%, 100% agree with that.

Henry:
Nice. So we’ve established it’s about getting again your time and that’s why I feel techniques are really for everyone as a result of most individuals get into actual property as a result of they really feel prefer it’s a passive enterprise after which all of us be taught pretty rapidly that it’s completely not a passive enterprise. However techniques permit you to purchase again that passivity in your small business. And so you may nonetheless have a semi-passive enterprise of actual property investing and make it extra passive by the usage of techniques. And then you definitely really do get time freedom. And that’s actually what that is about. It’s about having the time freedom as a result of that means that you can be the individual that you’re known as to be and never the individual that you must be for cash. I do know Pasha talks about having his crystal clear why and he calls it his “no BS why”. What does that imply and take us by why that’s vital, Pasha.

Pasha:
The no BS why got here up when, in case you guys truly listened to episode 773, it was like I used to be in a really dire state of affairs, if you’ll. And after that I assumed to myself why this by no means got here up. My life setting earlier than this factor was precisely the identical why I didn’t see that. And one of many issues that stood as much as me was I used to be form of following a why, that means why I’m doing all of this or why I needed to have a enterprise, that it was simply not unique to me. It wasn’t that I by no means heard about being an entrepreneur earlier than, I’d by no means heard about monetary independence earlier than. I used to be simply listening to different individuals speaking about how they needed to give up their job or how they needed to have the liberty of monetary dependency on their job, which is nice, don’t get me mistaken.
And I used to be listening to it and I used to be like, yeah, cool, that’s neat. I need that too. However I by no means took any actions on that as a result of fairly actually it was a BS why for me as a result of I really like my job. I actually do. It wasn’t an enormous motivation for me to be above and past and dig deeper into totally different enterprise fashions and attempt to be an entrepreneur. It’s simply a kind of issues that you just wish to guarantee that no matter motive you give you is one thing that 100% aligns with who you might be and what your core values are. And that is a kind of issues that’s form of arduous as a result of there are such a lot of shiny whys on the market as properly that you just may truly simply stumble throughout and also you’re like, “Oh, yeah, cool, I need it.” That’s not sufficient. You could have that. It’s not like I wish to have it. You could have that why.
I feel I talked to you, myself, nearly each different profitable entrepreneur I speak to, there’s a why of their life that comes from the necessity half. It doesn’t come from the need half. As a result of everyone desires to have a cool automobile to drive round. Everyone desires to have a enterprise that generates some huge cash. That’s the facet that you just see on loads of social media. However the second that the rainbows and unicorn go away and there are some alligators on the best way and there are some challenges on the best way, they again out as a result of that doesn’t fulfill their need half.
And that’s the explanation that I at all times advocate to individuals that really attain out to me is that just remember to have your eyes on the why, why you might be doing this, and it must be so robust. It must strongly align with you in a method that everytime you get up within the morning, you may give it some thought. It’s already in entrance of your eyes. It’s one thing that you just simply can not disconnect your self from it. It’s not like someday you’re not within the temper and someday you might be within the temper. It simply doesn’t work that method. And that’s why I known as it no BS why and it’s actually arduous to get there. I imply it’s nearly, it’s essential simply dig deeper and deeper and deeper in your self to get there.

Henry:
Sure, I utterly agree and I like that you just name it the no BS why as a result of I’d by no means heard it known as that earlier than. However I’ve talked about it totally different with a number of of my different college students and the best way I’ve at all times pictured is individuals at all times are, they’re fast to say, “I need monetary freedom, or, “I need monetary independence,” or, “I wish to construct generational wealth.” That’s the buzzword, generational wealth. All of these issues sound good, however I don’t know that individuals really perceive what they imply. For me, monetary freedom’s not a purpose. It’s not your why. Your why is what you get to do since you’re financially free. Monetary freedom permits you the time freedom to be the individual that you’re known as to be, not the individual you must be for cash. And sometimes while you’re the individual that you’re known as to be, you get to influence different individuals.
So your why is usually rooted in who you get to be in service of different individuals. And so while you’re fascinated by your why, you’re proper, it’s bought to be the factor that drives you past the nice days and the unhealthy days. You mentioned it greatest, you mentioned, you want it, you want it to occur. So in case you’re considering proper now, I wish to be an actual property investor in order that I may be financially free, that’s nice. Take it a step deeper. If you happen to had been free in the present day, in case you awoke and magically had all of the rental property to supply all of the cashflow you wanted to dwell your life-style and to pay for all of your life’s bills, what would you be doing with that freedom? Whose life would you be impacting with that freedom? That’s the place your no BS why lives. Agree?

Pasha:
100%. Completely. It’s at all times like, you see that image and then you definitely’re like, “Oh, man, wait. So now I’ve freedom however my household sucks,” or one thing like, “Now I must put all of my undivided consideration to my household.” And then you definitely’re like, “Okay, that is what I want, let’s go for it.” After which there may be nothing that actually can cease you as a result of precisely the place you wish to head to.

Henry:
We do that train with a number of of my college students and the cool half about listening to individuals dig into that’s who you get to be since you’re free. Lots of people are like, “Properly, now I get to retire my mother and father. Now I get to ship my mother and father on a visit or rework my mother and father’ home,” or, “now I get to pay the medical payments for my sick member of the family who couldn’t afford the correct medical therapy.” These are the issues, these are the whys which can be going to drive you thru the troublesome occasions. As a result of in case your why is barely rooted in you and what you need, of us, we’re human and we let ourselves down every single day.
You understand how many occasions I mentioned I’m going to go to the fitness center tomorrow and didn’t go? We let ourselves down on a regular basis, however we don’t prefer to let down different individuals. And so take into consideration who you get to assist, what you get to do with that freedom, that’s what pushes you thru. So speak to me briefly right here, Pasha, about how individuals discover that why, what drove you, what questions did you must ask your self to hit what that why was?

Pasha:
I feel for me it was a bit bit troublesome as a result of I used to be in a state of affairs that I discovered myself, I didn’t have loads of time after which instantly it was in entrance of me like, what are an important issues for me? However what I might advocate is, one, it’s essential be brutally sincere with your self. And there’s a phrase in there brutally, it means it’s not going to be snug, it’s going to be an uncomfortable dialogue. And generally you wish to usher in anyone that is aware of you very properly and ask them that will help you to dig deeper. It’s extra like interrogation even. You wish to just remember to get to the core wants that you just wish to go after and it’s one thing that simply makes you a blazing why that then it turns into an engine that it’s essential harness that vitality to run your small business in your day-to-day life.
However I might say be brutally sincere with your self. If you happen to’re speaking a few particular want that must be compensated for or must be addressed for, what are these wants? Write them down. As you talked about, it could be addressing your particular family members or the state of affairs that they could be left after. It must be tremendous tailor-made about you. So guarantee that it’s 100% personalized based mostly in your life, based mostly in your values in life. It’s good to have a look at different individuals’s why and that’s effective, however generally it simply merely doesn’t align and also you don’t wish to simply copy another person. You wish to just remember to tailor it for your self and it’s essential simply dig deeper and deeper and deeper till… Whenever you get there, it. It’s a kind of issues that, while you hit there, you’re like, “Oh, yeah, that’s it. That’s what 100% aligns with my core worth.”

Henry:
Discovering your why, Pasha’s the 1st step for locating your why is to be brutally sincere with your self. He additionally talks about if you wish to be wealthy or why you wish to be wealthy, diving into what which means. We discuss this so much with individuals. It’s like, what’s the wealth going to do for you? What’s the wealth going to do for the individuals round you? And then you definitely discuss while you outline your why, is there one thing that you just didn’t clearly know earlier than? That’s an excellent level as a result of if you find yourself digging into your why and attempting to determine what’s really driving you, it’s uncomfortable. It’s going to lift some questions and now you may need some new data that it’s essential work by so as to work out what that why is.
After which this one, I imagine, is vastly vital. Is it one thing that excites you everytime you get up within the morning? That’s a truth. This enterprise excites me to no finish. And what I like about this enterprise particularly is attending to share with different individuals and assist different individuals. I actually had a bummer name with a tenant proper earlier than this. However figuring out that I bought to get on right here and share actual property investing with all of you guys and chat with my pal Pasha and have him share his information and knowledge with you has actually lifted me up as a result of my why is rooted in ensuring that I share this information with individuals. So it will get me excited every single day. And so in case you reply no to any of those questions, it implies that it’s essential hold digging. And I feel that’s nice. And all these are coming from Pasha. And so what’s superior about that is that is Pashas system for having a why. This dude has a system for the whole lot.
So whereas we’re on that matter, let’s go forward and let’s dive into techniques. Pasha sat down with me and reviewed all of his techniques for his enterprise. I used to be one who didn’t implement loads of techniques, and it’s not as a result of I don’t assume they’re worthwhile, it’s simply, I’ve at all times been a prepared, fireplace, purpose form of operator after which make tweaks as I’m going. And once I sat down and went over to Pasha’s system, I used to be totally impressed, a lot in order that we began to implement a number of of the techniques that he’s utilizing. So I’ve began to implement a few of these techniques in my enterprise and I’m going to speak to you about these. However in a while within the present we’re going to interrupt down 5 steps of how one can construct any passive system with Pasha. So stick to us for that.
However for me, once I sat down with Pasha, I instantly carried out a system for exhibiting my rental properties and a system for keeping track of renovations of my properties. And so at a very excessive degree, Pasha had this nice system for putting in… Primarily you’re putting in web-enabled cameras, hooking them as much as a cell hotspot, after which putting in a web-enabled keypad door lock after which permitting your tenants who wish to see your property. So after our tenants apply, we are able to now give them a code the place they will go check out the property and we don’t need to bodily go see the property. And what was big for us is correct after we sat down with Pasha about this, we had been about to place a property in the marketplace that was a few 45-minute drive away from the place the remainder of our properties are. And so I used to be like, man, that is going to save lots of actually simply two hours of driving time per appointment already off the highest. Plus, in case you calculate that, and I do this for if I do 10 showings, that’s, what, 20 hours that you just saved in simply drive time.
And so we had been in a position to implement this on that property. We confirmed it just about. Nobody ever complained, nobody had an issue with it in any respect. The cameras would activate when individuals would enter the room. So we’d know when individuals confirmed up, we’d know once they left. The codes, we’d give all of them cycles, so everyone had their very own code. And it was actually a lot much less time-consuming and fewer painful that we’ve now carried out it for properties which can be even near us as a result of not solely is it saving drive time, however it’s saving the time that it takes to truly open up the property. And everyone knows as landlords, you set appointments for showings and about half of the individuals present up, a few of them don’t even present up. So that you’ve wasted your time even going to a property and folks simply no present on you. So what an enormous time saver for me. We’re additionally utilizing it to watch our rehab property. So I do know firsthand that a few of these techniques have been a lifesaver in my enterprise.
Pasha, let’s discuss, give us two of your favourite techniques after which how they’re saving you time or cash.

Pasha:
Oh, yeah, completely. As you talked about, the instance that you just introduced up was an excellent one. I feel after we had been beginning this, we realized that after we wish to present the property or after we wish to have a greater monitoring system on the contractors coming out and in, it must be one thing that may be accomplished just about. So precisely what you talked about, that’s what we carried out. All of the cameras, all the online connections, and all of the keypads all collectively. They usually truly are actually all in several containers. We’ve bought seven of those containers that they’re all paired. So all they should do is to only ship it to anyone, simply plug them to {the electrical} plug after which it’s all going to be on-line. I feel that’s actually one among my favourite ones. So that you undoubtedly took one of many favourite ones for certain.
It saved us loads of time. It nonetheless is saving us loads of time as a result of it’s simply a kind of issues that you just simply purchase them as soon as and then you definitely hold utilizing them. As you talked about, you don’t need to be the individual that drives all the best way there. And tenants adore it too, as a result of they didn’t really feel stress. They may go into the unit and so they may take a look at it. My contractors additionally, it allowed us to know who is an effective contractor who will not be. If anyone says, “Oh, I’ve been working right here for 5 days,” they’re like, “No, right here’s a log that really exhibits you’ve been working right here for 2 days. So let’s wrap it up. After which there are another people who they really really feel higher when you could have safety within the space for the entire supplies.
I imply all of this comes collectively into, what you talked about, the ache for enterprise, which is principally the way it’s all related collectively to resolve an issue for you, which for us it was not losing time and never losing vitality. And it’s additionally truly form of humorous too. Generally we go as a result of these are like two-way communications. So generally we go in there with the contractor and we’re like, “Hey, don’t overlook to complete that wall. We have to get that accomplished too.” First they’re all afraid like, who’s speaking to them, after which they discover. It’s truly fairly humorous. That’s one among them.
The opposite one which I actually like is the system that I put collectively, which is principally the class of the problems that may go mistaken in our rental properties. For instance, it says you probably have a, let’s say, surge or you probably have overloading like electrical after which we categorize it into plumbing space, landscaping space, principally handyman stuff, HVAC, issues like that. And the issues are principally in right here and the answer to them or the treatment can also be in entrance of them. After which on the finish it says, if none of those treatments work, then it’s essential contact this individual for that concern. And that individual goes to be the plumber, electrician, handyman. After which in fact we now have one other web page that has, these are our contacts for electrician, these are our contacts for a plumber, these are our contacts for so-and-so.
Now with one thing like this, I can simply step again and now my digital assistant that’s working remotely can handle the entire considerations, not all of them, however I might say 99% of the issues that our tenants have. They obtain these, they principally come right here, they match them with the issues right here, they stroll tenants by a few of the drawback fixing and generally our tenants are literally in a position to resolve the issue themselves, just like the small ones. Clearly if it’s severe or if it’s one thing that may create a legal responsibility, we ship a licensed individual to repair it. However generally there’s some simpler stuff that they will do and, man, our tenants adore it. They completely love this as a result of they get to resolve the issue actually quick. And it’s nice for us as a result of we don’t spend a whole bunch of {dollars} for each name. It’s one thing that may be addressed. I feel we handle 15% of our upkeep calls with doing one thing like this.
And if it helps, I’m going to guarantee that I ship a template to be able to put it into the facet notes. However once more, this is rather like a template. You could go in there and see what are the issues which can be relevant to your small business and you’ll construct one thing there. However that is additionally undoubtedly one among our entrance winners.

Henry:
That is actually cool, Pasha. And so what I wish to do is add a bit context right here for many who are listening or driving and might’t see, after which I wish to guarantee that I’m fascinated by it in the precise method. So what Pasha’s bought up here’s a spreadsheet, and in that spreadsheet he’s damaged down a class and I imagine the classes are the trades. And we are saying classes, what we’re speaking about is points. So if a tenant has a difficulty, one thing’s not working, you break it down into classes. So there’s that class, plumbing, electrical, is it handyman?
So you determine the class. If the class is a kind of, then on this spreadsheet you may comply with alongside and say, okay, it’s electrical. So what’s the subcategory? The subcategory, if it’s a electrical, it may very well be the breakers are tripping or it may very well be flickering lights. And so you discover the subcategory of the problem. After which as soon as you discover the subcategory of that concern, proper subsequent to that subcategory is the treatment or the resolve for that drawback. And so then you may see what that answer is, attempt to implement that answer and if that works, the issue is solved. And if that doesn’t work, then your subsequent part is who to contact to get anyone on the market to determine what the precise drawback is and get it fastened.
That is like while you name the cable firm as a result of your web’s out and so they’re like, “All proper, properly, is the sunshine lighting up?” And also you’re like, “Yeah, the sunshine’s lighting up.” They’re like, “Okay, nice. What’s your add pace, obtain pace? And also you inform them, they are saying, “Okay, nice.” So loads of these issues are simply solved by generally your modem isn’t on, proper? And so that you’re in a position to make use of this and it’s only a spreadsheet, it’s only a Google Sheet that you just took the time to fill out on the entrance facet with what points you usually see, after which the way you usually resolve these issues, after which who to contact if this resolve doesn’t work. And what you’ve accomplished is you’ve given this spreadsheet basically to a digital assistant.

Pasha:
That’s appropriate, sure.

Henry:
And your digital assistant takes the calls out of your tenants, so that you’re not taking calls for bogs and something. Your digital assistant, this actually is their coaching. They only comply with the spreadsheet, inform them what to do. If it doesn’t work, then this spreadsheet tells your digital assistant precisely which contractors to name. Is that appropriate?

Pasha:
That’s appropriate. And, once more, that is an instance, guys. You’ll be able to construct it your self or if you’d like, once more, I’m going to ensure that is accessible to you as properly. However the contact right here tells the digital assistant who they should contact, as a result of I don’t need them to make use of their judgment for it. I need them to comply with this written down system. So, for instance, on this case it says, if, let’s say, there’s a surge that it simply makes their fusebox flipping, then that is severe, you don’t wish to do something, you wish to contact an electrician. After which there’s one other web page that has the job title and folks which can be doing that and it ranks them from the primary to the final. So, begin calling them.

Henry:
And that is nice as a result of lots of people, one of many myths of landlording is that individuals say, “I don’t wish to be a landlord as a result of I don’t wish to cope with tenants and bogs.” And also you simply actually confirmed me a spreadsheet that offers with the tenants and bogs for you. So it’s not that massive of a deal, of us. Are you able to give us an instance or breakdown ultimately, how a lot time or cash is a system like this saving you and your small business?

Pasha:
Oh, man, so much, so much.

Henry:
What number of calls is your VA taking and what’s the amount you’re seeing?

Pasha:
We acquired about 218 tickets or calls within the final 12 months for our properties as a result of we truly form of expanded and all of them are addressed with my tenants. Now there are some examples which can be one-offs which can be actually bizarre and it means, for instance, we had a thunderstorm. You and I are each residing in Northwest Arkansas, so we all know that thunderstorms should not that alien right here. After which there was a tree that coming like 45 angle about to hit the home, however it didn’t. So clearly this was a kind of issues that we didn’t have it in our system after which we added it. So if there’s a tree hanging round, name a tree individual or tree elimination individual and now, from then they do it. However that was, I feel, the one name that I needed to chip in. I used to be like, “Okay, if that’s the problem, it’s essential name this individual.” However then I constructed it into my system so if it occurs once more, then I don’t should be pulled again into it.

Henry:
So for reference, what you’re saying is within the final 12 months you had 218 calls from tenants round points or potential points at a property. And of these 218 calls, you solely needed to speak to somebody one time.

Pasha:
Right.

Henry:
I might say the system works.

Pasha:
Thanks. Or possibly I’m simply tremendous fortunate, I don’t know.

Henry:
And it’s not simply that too, it’s not simply that. However what I wish to spotlight right here is he solely needed to get on the telephone one time, however he mentioned his tenants love this, they’re completely happy, they’re not feeling a disconnect from customer support by this.

Pasha:
Precisely.

Henry:
That’s superior.

Pasha:
And that helps us so much as a result of when your prospects are completely happy, when your renters are completely happy, the probabilities of them staying with you is extra. So your emptiness truly begins going decrease as a result of they know that at any time when they’ve a difficulty, it’s going to be addressed instantly. They don’t need to name the tenant, name the owner, sorry, after which landlord calls the seller and going forwards and backwards. So that is simply a kind of issues that it helps when you could have the whole lot on this format. And once more, I feel you talked about one factor that I actually wish to emphasize. That is constructed on Google Spreadsheet, which is free, accessible, accessible to everyone and it’s saving us loads of time. So one other factor is simply go along with what you assume you wish to do, construct a easy, tangible, straightforward to make use of system on no matter, even back-up a serviette, and simply to start out getting it to work.

Henry:
Thanks a lot, Pasha. I feel that was an excellent instance for individuals to see that techniques don’t need to be loopy costly and that they will profit everyone and prevent money and time.
All proper, so let’s transfer on to the meat and potatoes of the present. The data individuals actually wish to know is what are the 5 most vital steps for constructing any passive system? The 5 steps we now have listed here are inputs, processes, outputs, suggestions, and the atmosphere. What the heck does that imply? Pasha, give us an instance. So what are the inputs for a system?

Pasha:
So if you consider this, all of the techniques have these enter course of, output piece. So enter may be something actually, no matter you wish to get into so that you just’d have the ability to convert it into one thing else. So the enter may very well be any information level that you could find. For instance, within the instance that I confirmed, the enter goes to be the issue, the problem that the tenants are going through, proper? It’s simply the info level on the problem. It may very well be your P&L if you wish to have a system that checks your P&L and tells you in case you are doing okay or not. The enter must be actually aligned and I feel an important factor about enter is the enter is an important factor that must be aligned together with your core enterprise concern. You don’t wish to have additional data coming in, you need it to be proper, crisp, addressing the precise drawback that you just’re attempting to resolve and construct the system round it.

Henry:
Thanks. So enter is what you feed into the system after which course of. What’s the method? And I like the way you associated the inputs to the instance we simply noticed. So let’s proceed that. Let’s discuss what the method is after which what’s the method from the instance you simply confirmed us.

Pasha:
So course of is principally the engine of the system. That’s what it’s. It may very well be the step-by-step procedures in order that it follows a sure stream chart to get to a sure output. And this instance, for instance, it’s going to be the treatment part, which is while you stroll your tenant by the problems that they’ve and now you wish to principally get it fastened. So that you stroll them by how one can get the enter data and principally add to it or take a look at it from a unique angle or principally change that information enter. So, for instance, on this case, let’s say, if rubbish disposal is clogged and I feel, “Oh, the landlords are actually conversant in this concern,” is that you really want the tenant to go in there, take a look at the underside of it if there’s like a fuse button or one thing or if there’s a Allen wrench that they should use. All of those walkthroughs and procedures and step-by-step guides, that’s the place the method is available in.
And it’s simpler to do that. It’s principally the principle half that’s going to exchange you if you wish to construct a system to exchange you. Does that make sense? That is the place you’ll wish to have your information extracted from the individual that is an professional, often it’s going to be you, and also you wish to put it right into a step-by-step information that with that enter can comply with these step-by-step so that it’ll stream by that to the following step.

Henry:
So if I’m following you appropriately, the enter is the issue, the method is the the way you’re fixing the issue.

Pasha:
It may be.

Henry:
Okay, now speak to us about output.

Pasha:
All techniques must have a degree which principally desires to provide you what you want. Now generally the output of a system may be enter for the following system and this occurs on a regular basis, particularly if you wish to have a sequence of system and you probably have a posh enterprise mannequin that you just wish to put the whole lot collectively. On this instance, the output goes to be a walkthrough that’s already offered and ensuring that the issue is addressed. So it may be in several codecs, it may be within the format of a information repository. Information repository is principally the place you place all your data which can be actually tangible and worthwhile to you.
Within the instance of lead era, it’s going to be the listing of people who… So, let’s say, you begin with 1000 individuals, you could have a course of that breaks it right down to, let’s say, an inventory of 20. And now that 20 goes to be the output of your first system. That’s going to be individuals which can be extra more likely to be prepared to promote their residence. Now you could have one other system that use that after which course of it after which sends a mailer to them, for instance. However that output is principally what you’re going after and what the results of your system ought to appear like. And it may be in several codecs and it may be repeatable.

Henry:
It appears like your outputs can doubtlessly be in several codecs even inside the identical system as a result of with the instance we went by, one output could be that the outcomes guidelines resulted in the issue being fastened and one output could be that you just needed to name knowledgeable in and out one of many sub examples you gave, that skilled got here out and did the work and the output was now you could have a brand new subcategory so as to add to the spreadsheet so that you just don’t have to resolve that drawback once more.

Pasha:
That’s 100% proper. In order that output can feed to totally different techniques. One in every of them is the fee system. It’s a feed to a unique one, which is like, now the job is completed, it must go to the payroll system. So that you pay them. Once more, you don’t wish to be the one who writes the examine each time. One other one goes to be, the issue is solved, however it was a brand new one, so let’s return and add it to the system that we now have, which principally is the following system which is the suggestions.

Henry:
Yeah, let’s discuss that.

Pasha:
So suggestions… Okay, so the enter course of output is sort of widespread. I might say that even in massive corporates when it’s constructed, when the enter is given and when the output is taken, everyone’s like, “Hallelujah, we bought there. That’s the system we would like.” And, man, I see this time and again, which they simply depart it like that. They’re like, “Okay, cool, the system is working.” After which they simply go on to the following one. The issue is you construct a system however it’s not a sustainable system as a result of because the context adjustments, because the enter adjustments, because the enterprise world adjustments, your system must be alert, it wants to know what’s occurring so it could possibly alter itself.
So a very good instance of it will be figuring out KPIs for the way your system is working in order that in case your system is definitely in good condition or not. So, for instance, on this case, once more going again to the upkeep system, the KPI for us is, are our tenants completely happy about addressing their points or not? So we ship out two surveys each six months, principally, yearly. So each six months we ship one survey and we ask our tenants how do they really feel they’re being handled, how do they assume their upkeep points are being addressed? And that could be a nice KPI as a result of it tells us whether or not it’s one thing that finally our tenants are feeling nice about it or not. And in the event that they don’t, we have to come again. In order that’s our KPI, proper?
The primary yr it’d work completely, however the second yr it’d truly not work rather well and it’s going to lift a crimson flag that enables us to return in there, dig into our system and see what was the problem, what precipitated that individual to not be completely happy about it. After which we stroll it again after which we alter our processes, we alter our enter to guarantee that subsequent time we are able to handle this. So the suggestions is principally a loop that goes out of your output to the method and to the enter to guarantee that we replace it and keep related.

Henry:
Okay, nice. So, if I’m understanding, the suggestions or suggestions loop is what takes your system from being a static system that by no means adjustments to a dynamic system that’s altering or evolving as your small business evolves. So with the instance you gave, you measure your tenants, principally you measure in the event that they’re happy with the work that’s being accomplished. In case you are nice, you state the system retains doing what it’s doing. If you happen to’re getting loads of suggestions that tenants aren’t completely happy, then you may dig deeper into that suggestions after which alter your system to handle these suggestions points after which proceed to judge and make adjustments so your system is dynamic. And I’m going to exit on a limb right here and I’m going to guess that you’ve a system that does the suggestions for you.

Pasha:
I really like that. I really like that. I do. No, yeah, completely. Now you wish to guarantee that, once more, that system, that suggestions loop can also be working the best way that you really want. This is sort of a loop, it’s like a spiral, you may simply go right down to it. However 100%. And once more, begin with one thing easy, simply enter course of output is ideal, however it shouldn’t be like your last vacation spot. Simply put some KPI, be certain that this KPI is sweet. If you’d like, you may at all times, as Henry talked about, construct one other system in your KPI. However on the finish of the day you wish to guarantee that this isn’t a one linear line. It truly goes again and it feeds itself so it stays related. As a result of in case you do this, you’re going to need to spend much less time coming again to the issues that aren’t being addressed by your techniques.

Henry:
Implausible. So to recap, we bought the 5 predominant elements of a system is the enter. That’s the drawback that you just feed into the system. You’ve bought the method, that’s basically the way you’re fixing the issue or the way you’re addressing that concern. You’ve bought your output, which may be the outcomes of that course of and that may be a optimistic or a detrimental end result. After which you can also make changes to your course of by suggestions and measuring the outcomes. After which atmosphere, we didn’t contact on atmosphere, did we?

Pasha:
The atmosphere is principally the context that your system is working in and that’s just like the final element that you really want to concentrate on. Principally on this instance, once more, if this method is working in properties, I’m simply saying like in Arkansas and now you wish to handle the identical properties in, let’s say, California, you’re in a unique context, you might be in a unique context for enter, you’re in a unique context for processes, some litigations apply to it, some litigations to the output and that’s the place you need to concentrate on that, return in there and alter your techniques to the context that they’re working in to guarantee that your system stays related.

Henry:
Thanks for breaking down that 5 step course of, Pasha, that’s nice data and I feel it actually helps not solely to demystify techniques however make it appear to be one thing everyone must be implementing inside their enterprise at some degree. Earlier than we go, give us some examples of some wins or some successes or some positivity that’s come from you implementing a number of techniques in your small business that possibly you didn’t anticipate.

Pasha:
I feel one among them is we had been truly in Hawaii and my condo bought flooded, one of many ones that really we had a tenant in. I’m not speaking a few leak or one thing. It was about to get flooded actually unhealthy. I didn’t even discover. It was simply on my weekly report that I get from the digital assistant of what’s happening as a result of I at all times wish to know what’s happening. And it was simply addressed mechanically. The issue raised, they known as, there’s an emergency degree on that system, it was a excessive emergency. They dispatched anyone like a plumber that’s actually good in mildew remediation and all of that. Thank God it didn’t get to any of this as a result of we had this in like the primary hour.
And I feel, all in all, we spent about $800 and it included a brand new piece to the water heater, which, if I didn’t have the system in there, I’m fairly certain my journey would’ve been ruined and it wouldn’t be a really pleasing expertise for my tenant both. However it was addressed within the first couple of hours and it was utterly working effective, which, to me, it was an excellent win as a result of it confirmed me that it could possibly work particularly once I wanted it to.

Henry:
Yeah, man, that’s an excellent instance since you’re proper, nobody desires the decision once they’re on trip that one among their models flooded. And it at all times looks as if that’s while you get these calls is while you’re out having a very good time. In order that’s cool that your system simply form of dealt with it for you and saved you all types of cash and did precisely what it was purported to do. That’s wonderful. Thanks for sharing that.
All proper, thanks, Pasha, for giving us this breakdown of techniques. There are some nice data that you just gave us as a result of, once more, techniques, I like to think about it and also you form of put this in my head, it’s that we’re all already utilizing techniques, proper? A system is only a course of you could have in your small business and loads of the occasions our processes simply aren’t nice. And so considering of techniques isn’t considering of how can I’m going purchase an costly piece of software program or how do I spend loads of effort and time to resolve big-level issues? It’s only a matter of systematizing the issues which can be vital to you or the issues which can be taking essentially the most of your time that you just don’t wish to be taking your time and giving it some inputs, some processes and a few outputs, after which offering some suggestions to maintain your techniques dynamic and you’ll actually save your self, not simply time however cash. Did I summarize that in a great way there for you?

Pasha:
And one other factor that I simply needed so as to add actual fast is typically it’s such as you may not be the individual that is the professional in that space and that’s nonetheless effective. An excellent instance is like, you and I’ve been pals for years and I personally realized so much from you, particularly in the case of discovering good off-market offers. And I used to be like, man, this man is aware of his stuff. As I confirmed it to you, we began fascinated by all of those procedures and processes, how can we flip that right into a system in order that even that may be automated.
So, for instance, I do know that we didn’t get time to get there, however even lead era proper now for me is one thing that I put collectively. Once more, we tried it, it began with essentially the most easiest way, however proper now it’s like, hey, I simply despatched this zip code that I wish to go after. After which there’s truly, I known as it LA, so native assistant, that picks it up, processes all of the mails. The direct mails are out, all of the codecs, the whole lot is predefined. However all of them comes from, not from me, however from a educated individual within the space, such as you, that may assist me get understanding how this must be. And all I do is simply take the idea from the thinner and convert it right into a system and simply let the system work.

Henry:
That’s nice data. A good way to consider fixing issues. Pasha, thanks a lot for being gracious sufficient to share a template or a clean template instance of your, what do you name that?

Pasha:
I name it Residential Upkeep System XLX.

Henry:
Your RMS Spreadsheet. And so if you’d like to try that spreadsheet template, you may go to biggerpockets.com/assets the place Pasha has been gracious sufficient to share that with us. And so let the individuals know the place they will discover you, Mr. Pasha.

Pasha:
You will discover me on Instagram, @techierealestate, T-E-C-H-I-E, actual property, all one phrase. And likewise the web site is 5dayscourse.com. These are the 2 locations that you could find me.

Henry:
Nice. And you could find me on Instagram as properly. I’m @thehenrywashington on Instagram. Thanks a lot for becoming a member of us. A lot of nice data there, Pasha. It’s been a pleasure speaking to you and we want you nothing however the perfect.

Pasha:
Thanks, sir. Have a very good one.