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

Henry:
That is the BiggerPockets Podcast present quantity 784. Look, I did it. I nailed the fingers on the primary strive. 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 discuss to somebody one time.

Pasha:
Appropriate.

Henry:
I might say the system works.

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

Henry:
I’m taking on the BiggerPockets Podcast immediately and I’ve the pleasure of interviewing my good pal, my associate, my scholar, Mr. Pasha Maleknia. Pasha’s bought a complicated diploma in data methods. He’s right here to show you construct methods 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 laborious. I might say constructing a brand new system. I identical 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 methods with out even figuring out it. Your methods most likely simply aren’t that nice but. We’re going to speak concerning the money and time methods 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 excellent place to be as a result of you may set what you are promoting up for progress within the long-term. And in case you’re an skilled investor, you must stick round and hear as a result of we’re going to speak about issues that would probably put more cash in your pocket and likewise enable you to care for 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 immediately we’re going to maneuver into the-

Pasha:
Fast tip.

Henry:
Right now’s fast tip is go to biggerpockets.com/sources. There you may obtain Pasha’s instance spreadsheet of how one can implement a system and jumpstart constructing methods on your personal enterprise. Thanks Pasha for sharing that with us. It’s a brilliant cool software. 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 all people, 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 unimaginable 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 sort of left with a bit little bit of a cliffhanger. Pasha is an skilled on methods and 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 methods, what they’re and the way he implements them and the way you have to be contemplating and doing the identical factor. As a result of the tremendous secret is all people already has methods in place, they most likely simply suck. So let’s discuss to Pasha about methods.
So Pasha, clearly, he’s a pal of mine, he’s a scholar of mine, and he’s a superb actual property investor. So I needed to start out off, Pasha, in case you wouldn’t thoughts by let’s dispel some myths round methods. As a result of each time folks hear the phrase system, I believe generally they suppose it’s rather a lot both greater than it’s or costlier than it’s, or that they’re not prepared for methods of their enterprise but. And I don’t actually consider 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. Possibly I’m simply fully mistaken right here.

Pasha:
100%. Let’s do it.

Henry:
So the primary delusion is that methods should be complicated. Is that this a delusion or is that this info?

Pasha:
Completely a delusion. As you realize, even in greater firms generally there’s an inclination to construct complicated methods and it virtually at all times fireplace backed. I believe the very best methods that I’ve encountered are of their easiest type. And also you at all times need to begin with a quite simple one degree sort 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 simply’re tackling. However I see this rather a lot that individuals begin with an ideal system, a really complicated system as a result of they like it, however whereas they’re constructing it, they need it to be completely good, nevertheless it finally ends up with a system that by no means implements.
The best type of methods are at all times higher as a result of you may at all times get a suggestions and you may 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 methods, at all times going to suck.” So it’s higher to simply 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 positively don’t begin with a posh system.

Henry:
Superior. Man, that’s nice perception as a result of I believe folks do are inclined to overthink methods. I do know I did and truthfully most likely nonetheless do in a variety of areas of my enterprise. So the second delusion is that you simply 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 delusion, completely a delusion. I’ve stated this rather a lot virtually in all of the talks that I’m going to, all of the workshops and the whole lot, folks 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, nevertheless it’s like lots of people need to begin from the software program. They suppose software program functions or apps are the methods, which is 100% mistaken.
Principally you at all times need to just remember to begin together with your core problems with what you are promoting first, then you definately stroll that again and then you definately give attention to what system can handle that core problem that I’ve. And then you definately exit and store for the softwares or functions for it. An instance I may say goes to House Depot and purchase the primary 5 instruments that you simply see from the shelf after which return dwelling and attempt to construct one thing with it. That’s not the way it works. You at all times need to just remember to give attention to a related software on your want. And I see this rather a lot, man. They suppose they simply want to write down a examine for a giant fancy software program and so they suppose that each one of their issues are going to go away magically. And I at all times inform them that you simply’re in for a giant shock as a result of that’s not going to occur.

Henry:
Superior. Yeah, that’s an effective way to take a look at it. Right here’s a enjoyable truth about me. Even when I knew precisely what software I wanted to do a job and I walked into House Depot and acquired that software, 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. Possibly we’ll throw that on the finish of the present, professional tip for you new traders.
That’s a implausible level as a result of lots of people suppose that methods imply I have to 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 admittedly only a set of processes that you simply implement systematically again 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 in every of your methods that was actually only a Google Sheet. All people has entry to Google Sheets. So it’s not software program you want, it’s processes.

Pasha:
100%. One other factor that I need to add is we’re on the age of data expertise that it’s the best time to construct a software program and when you 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 latest development, 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 need to just remember to at all times begin from the enterprise, you at all times begin your methods round it, and then you definately return and begin searching for one thing that’s related to yours.

Henry:
The subsequent delusion that I need to discuss is, so I’m sort of going to skip one right here as a result of I believe we at present already hit at it. Methods are just for massive companies. Clearly we’ve touched on that. We all know that methods are meant for any enterprise of any aspect, it’s only a course of. However this one I believe is admittedly necessary is that methods are just for out-of-state traders.

Pasha:
After we discuss methods are just for out of the state, I believe that’s not related as a result of I believe I’m the dwelling 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 sort of urge ourselves to guarantee that we by no means step into any of them as a result of we need to have the liberty of geographical location. We would like to have the ability to be wherever we wish and be capable to renovate our houses and be capable to handle all of our houses. We have already got carried out the administration piece, now we’re targeted on constructing our methods round rehabbing them remotely. If you wish to be extra passive in what you are promoting, I might suggest to start out simply fascinated about constructing the companies that you’ve on a platform that’s scalable and that’s solely doable when you have a superb system in place. And also you don’t must be out of the state. You will be as shut as it may well get to you, however you simply don’t need to be the weather that’s the heart of what you are promoting.

Henry:
If I’m listening to you accurately, what you’re saying is that methods are supposed to prevent money and time. And who doesn’t need to save time or cash irrespective of the place you’re situated? However implementing methods if you find yourself native as properly I might suppose provides 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 methods once you’re native since you will be there to hone it. After which when you’ve bought it dialed in, you actually open up virtually this world of enlargement. As a result of in case you’re not tied to the geographic location of the place your properties are, although you’re native, what’s stopping you from selecting a special market and increasing what you are promoting since you see a possibility in a brand new market and now you’re not held again by geographic location? So I believe that’s an outstanding manner to take 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 believe methods are actually 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 shortly that it’s completely not a passive enterprise. However methods will let you purchase again that passivity in what you are promoting. And so you may nonetheless have a semi-passive enterprise of actual property investing and make it extra passive via the usage of methods. And then you definately actually do get time freedom. And that’s actually what that is about. It’s about having the time freedom as a result of that lets you be the person who you’re referred to as to be and never the person who 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 via why that’s necessary, 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 sort 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 folks speaking about how they needed to stop their job or how they needed to have the liberty of economic 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 would like that too. However I by no means took any actions on that as a result of fairly truthfully it was a BS why for me as a result of I really like my job. I truthfully do. It wasn’t a giant 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 type of issues that you simply need to guarantee that no matter purpose you give you is one thing that 100% aligns with who you might be and what your core values are. And that is a type of issues that’s sort of laborious as a result of there are such a lot of shiny whys on the market as properly that you simply may truly simply stumble throughout and also you’re like, “Oh, yeah, cool, I would like it.” That’s not sufficient. You might want to have that. It’s not like I need to have it. You might want to have that why.
I believe I talked to you, myself, virtually each different profitable entrepreneur I discuss 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 all people desires to have a cool automobile to drive round. All people desires to have a enterprise that generates some huge cash. That’s the facet that you simply see on a variety 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 suggest to folks that truly 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 sturdy. It must strongly align with you in a manner 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 simply simply can’t disconnect your self from it. It’s not like in the future you’re not within the temper and in the future you might be within the temper. It simply doesn’t work that manner. And that’s why I referred to as it no BS why and it’s actually laborious to get there. I imply it’s virtually, it is advisable to simply dig deeper and deeper and deeper in your self to get there.

Henry:
Sure, I fully agree and I like that you simply name it the no BS why as a result of I’d by no means heard it referred to 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 folks at all times are, they’re fast to say, “I would like monetary freedom, or, “I would like monetary independence,” or, “I need to construct generational wealth.” That’s the buzzword, generational wealth. All of these issues sound good, however I don’t know that individuals actually perceive what they imply. For me, monetary freedom’s not a objective. 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 person who you’re referred to as to be, not the individual you must be for cash. And sometimes once you’re the person who you’re referred to as to be, you get to affect different folks.
So your why is usually rooted in who you get to be in service of different folks. And so once you’re fascinated about your why, you’re proper, it’s bought to be the factor that drives you past the great days and the unhealthy days. You stated it greatest, you stated, you want it, you want it to occur. So in case you’re considering proper now, I need to be an actual property investor in order that I will be financially free, that’s nice. Take it a step deeper. If you happen to had been free immediately, in case you awakened and magically had all of the rental property to provide all of the cashflow you wanted to dwell your way of life 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 definately’re like, “Oh, man, wait. So now I’ve freedom however my household sucks,” or one thing like, “Now I have to put all of my undivided consideration to my household.” And then you definately’re like, “Okay, that is what I would like, let’s go for it.” After which there’s nothing that basically can cease you as a result of you realize precisely the place you need to head to.

Henry:
We do that train with a number of of my college students and the cool half about listening to folks dig into that’s who you get to be since you’re free. Lots of people are like, “Nicely, now I get to retire my dad and mom. Now I get to ship my dad and mom on a visit or rework my dad and mom’ 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 instances. As a result of in case your why is just rooted in you and what you need, of us, we’re human and we let ourselves down daily.
You know the way many instances I stated I’m going to go to the health club tomorrow and didn’t go? We let ourselves down on a regular basis, however we don’t wish to let down different folks. 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 discuss to me briefly right here, Pasha, about how folks discover that why, what drove you, what questions did you must ask your self to hit what that why was?

Pasha:
I believe 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 a variety of time after which instantly it was in entrance of me like, what are a very powerful issues for me? However what I might suggest is, one, it is advisable to be brutally trustworthy 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 need to herald someone that is aware of you very properly and ask them that can assist you to dig deeper. It’s extra like interrogation even. You need to just remember to get to the core wants that you simply need to go after and it’s one thing that simply makes you a blazing why that then it turns into an engine that it is advisable to harness that power to run what you are promoting in your day-to-day life.
However I might say be brutally trustworthy with your self. If you happen to’re speaking a couple of particular want that must be compensated for or must be addressed for, what are these wants? Write them down. As you talked about, it is perhaps addressing your particular family members or the state of affairs that they is perhaps 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 take a look at different folks’s why and that’s tremendous, however generally it simply merely doesn’t align and also you don’t need to simply copy another person. You need to just remember to tailor it for your self and it is advisable to simply dig deeper and deeper and deeper till… While you get there, you realize it. It’s a type of issues that, once 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 first step for locating your why is to be brutally trustworthy with your self. He additionally talks about if you wish to be wealthy or why you need to be wealthy, diving into what meaning. We discuss this rather a lot with folks. It’s like, what’s the wealth going to do for you? What’s the wealth going to do for the folks round you? And then you definately discuss once you outline your why, is there one thing that you simply didn’t clearly know earlier than? That’s an important level as a result of if you find yourself digging into your why and attempting to determine what’s actually driving you, it’s uncomfortable. It’s going to boost some questions and now you might need some new data that it is advisable to work via with the intention to work out what that why is.
After which this one, I consider, is vastly necessary. 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 folks and assist different folks. 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 data 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 folks. So it will get me excited daily. And so in case you reply no to any of those questions, it signifies that it is advisable to hold digging. And I believe 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 subject, let’s go forward and let’s dive into methods. Pasha sat down with me and reviewed all of his methods for his enterprise. I used to be one who didn’t implement a variety of methods, and it’s not as a result of I don’t suppose they’re precious, it’s simply, I’ve at all times been a prepared, fireplace, goal sort 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 completely impressed, a lot in order that we began to implement a number of of the methods that he’s utilizing. So I’ve began to implement a few of these methods in my enterprise and I’m going to speak to you about these. However afterward within the present we’re going to interrupt down 5 steps of how one can construct any passive system with Pasha. So follow us for that.
However for me, once I sat down with Pasha, I instantly carried out a system for displaying 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… Basically 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 need to see your property. So after our tenants apply, we will now give them a code the place they’ll go check out the property and we don’t must bodily go see the property. And what was big for us is true after we sat down with Pasha about this, we had been about to place a property in the marketplace that was a couple of 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 simply saved in simply drive time.
And so we had been capable of implement this on that property. We confirmed it nearly. Nobody ever complained, nobody had an issue with it in any respect. The cameras would activate when folks would enter the room. So we’d know when folks confirmed up, we’d know after they left. The codes, we’d give all of them cycles, so all people 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, nevertheless it’s saving the time that it takes to really open up the property. And everyone knows as landlords, you set appointments for showings and about half of the folks 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 observe our rehab property. So I do know firsthand that a few of these methods have been a lifesaver in my enterprise.
Pasha, let’s discuss, give us two of your favourite methods after which how they’re saving you time or cash.

Pasha:
Oh, yeah, completely. As you talked about, the instance that you simply introduced up was an excellent one. I believe after we had been beginning this, we realized that after we need to present the property or after we need to have a greater monitoring system on the contractors coming out and in, it must be one thing that may be carried out nearly. So precisely what you talked about, that’s what we carried out. All of the cameras, all the net connections, and all of the keypads all collectively. And so they truly are actually all in numerous bins. We’ve bought seven of those bins that they’re all paired. So all they should do is to simply ship it to someone, simply plug them to {the electrical} plug after which it’s all going to be on-line. I believe that’s actually one in every of my favourite ones. So that you positively took one of many favourite ones for certain.
It saved us a variety of time. It nonetheless is saving us a variety of time as a result of it’s simply a type of issues that you simply simply purchase them as soon as and then you definately hold utilizing them. As you talked about, you don’t must be the person who drives all the best way there. And tenants like it too, as a result of they didn’t really feel strain. They might go into the unit and so they may take a look at it. My contractors additionally, it allowed us to grasp who is an effective contractor who will not be. If someone says, “Oh, I’ve been working right here for 5 days,” they’re like, “No, right here’s a log that truly 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 might 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 mainly the way it’s all related collectively to resolve an issue for you, which for us it was not losing time and never losing power. And it’s additionally truly sort of humorous too. Typically 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 neglect to complete that wall. We have to get that carried out too.” First they’re all afraid like, who’s speaking to them, after which they discover. It’s truly fairly humorous. That’s one in every of them.
The opposite one which I actually like is the system that I put collectively, which is mainly the class of the problems that may go mistaken in our rental properties. For instance, it says when you have a, let’s say, surge or when you have overloading like electrical after which we categorize it into plumbing space, landscaping space, mainly handyman stuff, HVAC, issues like that. And the issues are mainly in right here and the answer to them or the treatment can be in entrance of them. After which on the finish it says, if none of those treatments work, then it is advisable to contact this individual for that problem. And that individual goes to be the plumber, electrician, handyman. After which after all we’ve 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 issues, not all of them, however I might say 99% of the issues that our tenants have. They obtain these, they mainly come right here, they match them with the issues right here, they stroll tenants via a number of the drawback fixing and generally our tenants are literally capable of 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’ll do and, man, our tenants like 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 tons of of {dollars} for each name. It’s one thing that may be addressed. I believe 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 with the intention to put it into the aspect notes. However once more, this is rather like a template. You might want to go in there and see what are the issues which can be relevant to what you are promoting and you may construct one thing there. However that is additionally positively one in every of our entrance winners.

Henry:
That is actually cool, Pasha. And so what I need to do is add a bit context right here for individuals who are listening or driving and might’t see, after which I need to guarantee that I’m fascinated about it in the precise manner. So what Pasha’s bought up here’s a spreadsheet, and in that spreadsheet he’s damaged down a class and I consider the classes are the trades. And we are saying classes, what we’re speaking about is points. So if a tenant has a problem, 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 type of, then on this spreadsheet you may observe 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 problem, proper subsequent to that subcategory is the treatment or the resolve for that drawback. And so then you may see what that resolution is, attempt to implement that resolution and if that works, the issue is solved. And if that doesn’t work, then your subsequent part is who to contact to get someone on the market to determine what the precise drawback is and get it mounted.
That is like once 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 a variety of these issues are simply solved by generally your modem isn’t on, proper? And so that you’re ready to make use of this and it’s only a spreadsheet, it’s only a Google Sheet that you simply took the time to fill out on the entrance aspect 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 carried out is you’ve given this spreadsheet basically to a digital assistant.

Pasha:
That’s right, sure.

Henry:
And your digital assistant takes the calls out of your tenants, so that you’re not taking calls for bathrooms and something. Your digital assistant, this actually is their coaching. They simply observe 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 right?

Pasha:
That’s right. And, once more, that is an instance, guys. You possibly can construct it your self or in order for you, 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 would like them to observe 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 need to do something, you need 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 need to be a landlord as a result of I don’t need to take care of tenants and bathrooms.” And also you simply actually confirmed me a spreadsheet that offers with the tenants and bathrooms for you. So it’s not that large of a deal, of us. Are you able to give us an instance or breakdown indirectly, how a lot time or cash is a system like this saving you and what you are promoting?

Pasha:
Oh, man, rather a lot, rather a lot.

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

Pasha:
We obtained about 218 tickets or calls within the final 12 months for our properties as a result of we truly sort 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 dwelling in Northwest Arkansas, so we all know that thunderstorms usually are not that alien right here. After which there was a tree that coming like 45 angle about to hit the home, nevertheless it didn’t. So clearly this was a type 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 believe, the one name that I needed to chip in. I used to be like, “Okay, if that’s the problem, it is advisable to 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 discuss to somebody one time.

Pasha:
Appropriate.

Henry:
I might say the system works.

Pasha:
Thanks. Or perhaps 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 need to spotlight right here is he solely needed to get on the telephone one time, however he stated his tenants love this, they’re joyful, they’re not feeling a disconnect from customer support via this.

Pasha:
Precisely.

Henry:
That’s superior.

Pasha:
And that helps us rather a lot as a result of when your prospects are joyful, when your renters are joyful, the probabilities of them staying with you is extra. So your emptiness truly begins going decrease as a result of they know that each time they’ve a problem, it’s going to be addressed instantly. They don’t must name the tenant, name the owner, sorry, after which landlord calls the seller and going forwards and backwards. So that is simply a type of issues that it helps when you might have the whole lot on this format. And once more, I believe you talked about one factor that I actually need to emphasize. That is constructed on Google Spreadsheet, which is free, accessible, accessible to all people and it’s saving us a variety of time. So one other factor is simply go together with what you suppose you need 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 believe that was an important instance for folks to see that methods don’t must be loopy costly and that they’ll profit all people and prevent money and time.
All proper, so let’s transfer on to the meat and potatoes of the present. The knowledge folks actually need to know is what are the 5 most necessary steps for constructing any passive system? The 5 steps we’ve listed here are inputs, processes, outputs, suggestions, and the setting. What the heck does that imply? Pasha, give us an instance. So what are the inputs for a system?

Pasha:
So if you concentrate on this, all of the methods have these enter course of, output piece. So enter will be something truthfully, no matter you need to get into so that you simply’d be capable to convert it into one thing else. So the enter may very well be any knowledge level that you’ll find. For instance, within the instance that I confirmed, the enter goes to be the issue, the problem that the tenants are dealing with, proper? It’s simply the information 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 believe a very powerful factor about enter is the enter is a very powerful factor that must be aligned together with your core enterprise problem. You don’t need to have further data coming in, you need it to be proper, crisp, addressing the precise drawback that you simply’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 mainly 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 move chart to get to a sure output. And this instance, for instance, it’s going to be the treatment part, which is once you stroll your tenant via the problems that they’ve and now you need to mainly get it mounted. So that you stroll them via how one can get the enter data and mainly add to it or take a look at it from a special angle or mainly change that knowledge enter. So, for instance, on this case, let’s say, if rubbish disposal is clogged and I believe, “Oh, the landlords are actually acquainted with this problem,” 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 mainly the principle half that’s going to switch you if you wish to construct a system to switch you. Does that make sense? That is the place you’d need to have your data extracted from the person who is an skilled, normally it’s going to be you, and also you need to put it right into a step-by-step information that with that enter can observe these step-by-step so that it’s going to move via that to the following step.

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

Pasha:
It may be.

Henry:
Okay, now discuss to us about output.

Pasha:
All methods have to have a degree which mainly desires to provide you what you want. Now generally the output of a system will be enter for the following system and this occurs on a regular basis, particularly if you wish to have a series of system and when you have a posh enterprise mannequin that you simply need 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 numerous codecs, it may be within the format of a data repository. Data repository is mainly the place you place your whole data which can be actually tangible and precious to you.
Within the instance of lead era, it’s going to be the record of people who… So, let’s say, you begin with 1000 folks, you might have a course of that breaks it all the way down to, let’s say, a listing of 20. And now that 20 goes to be the output of your first system. That’s going to be folks which can be extra more likely to be prepared to promote their dwelling. Now you might 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 mainly what you’re going after and what the results of your system ought to seem like. And it may be in numerous codecs and it may be repeatable.

Henry:
It appears like your outputs can probably be in numerous codecs even inside the identical system as a result of with the instance we went via, one output is perhaps that the outcomes guidelines resulted in the issue being mounted and one output is perhaps that you simply 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 might have a brand new subcategory so as to add to the spreadsheet so that you simply don’t have to resolve that drawback once more.

Pasha:
That’s 100% proper. In order that output can feed to totally different methods. One among them is the cost system. It’s a feed to a special one, which is like, now the job is finished, it must go to the payroll system. So that you pay them. Once more, you don’t need to be the one who writes the examine each time. One other one goes to be, the issue is solved, nevertheless it was a brand new one, so let’s return and add it to the system that we’ve, which mainly 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 kind of widespread. I might say that even in large corporates when it’s constructed, when the enter is given and when the output is taken, all people’s like, “Hallelujah, we bought there. That’s the system we wish.” And, man, I see this again and again, which they simply go away 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 nevertheless it’s not a sustainable system as a result of because the context modifications, because the enter modifications, because the enterprise world modifications, your system must be alert, it wants to grasp what’s taking place so it may well alter itself.
So a superb instance of it will be figuring out KPIs for a way your system is working in order that you realize in case your system is definitely in fine 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 joyful about addressing their points or not? So we ship out two surveys each six months, mainly, 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 suppose 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 ultimately 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 boost a pink flag that permits us to return in there, dig into our system and see what was the problem, what precipitated that individual to not be joyful about it. After which we stroll it again after which we alter our processes, we alter our enter to guarantee that subsequent time we will handle this. So the suggestions is mainly 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 modifications to a dynamic system that’s altering or evolving as what you are promoting evolves. So with the instance you gave, you measure your tenants, mainly you measure in the event that they’re glad with the work that’s being carried out. If you’re nice, you state the system retains doing what it’s doing. If you happen to’re getting a variety of suggestions that tenants aren’t joyful, then you may dig deeper into that suggestions after which alter your system to deal with these suggestions points after which proceed to judge and make modifications 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 need to guarantee that, once more, that system, that suggestions loop can be working the best way that you really want. This is sort of a loop, it’s like a spiral, you may simply go all the way down to it. However 100%. And once more, begin with one thing easy, simply enter course of output is ideal, nevertheless it shouldn’t be like your last vacation spot. Simply put some KPI, be certain that this KPI is sweet. In order for you, you may at all times, as Henry talked about, construct one other system on your KPI. However on the finish of the day you need 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 must spend much less time coming again to the issues that aren’t being addressed by your methods.

Henry:
Incredible. So to recap, we bought the 5 fundamental parts of a system is the enter. That’s the drawback that you simply 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 problem. You’ve bought your output, which will be the outcomes of that course of and that may be a optimistic or a unfavourable consequence. After which you may make changes to your course of via suggestions and measuring the outcomes. After which setting, we didn’t contact on setting, did we?

Pasha:
The setting is mainly 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 houses, I’m simply saying like in Arkansas and now you need to handle the identical properties in, let’s say, California, you’re in a special context, you might be in a special context for enter, you’re in a special 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 methods 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 believe it actually helps not solely to demystify methods however make it look like one thing all people ought to 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 methods in what you are promoting that perhaps you didn’t anticipate.

Pasha:
I believe one in every of them is we had been truly in Hawaii and my house bought flooded, one of many ones that truly we had a tenant in. I’m not speaking a couple of 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 need to know what’s happening. And it was simply addressed routinely. The issue raised, they referred to as, there’s an emergency degree on that system, it was a excessive emergency. They dispatched someone 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 believe, 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 fully working tremendous, which, to me, it was an important win as a result of it confirmed me that it may well work particularly once I wanted it to.

Henry:
Yeah, man, that’s an important instance since you’re proper, nobody desires the decision after they’re on trip that one in every of their models flooded. And it at all times looks like that’s once you get these calls is once you’re out having a superb time. In order that’s cool that your system simply sort of dealt with it for you and saved you every kind of cash and did precisely what it was alleged to do. That’s wonderful. Thanks for sharing that.
All proper, thanks, Pasha, for giving us this breakdown of methods. There are some nice data that you simply gave us as a result of, once more, methods, I like to think about it and also you sort of put this in my head, it’s that we’re all already utilizing methods, proper? A system is only a course of you might have in what you are promoting and a variety of the instances our processes simply aren’t nice. And so considering of methods isn’t considering of how can I’m going purchase an costly piece of software program or how do I spend a variety of effort and time to resolve big-level issues? It’s only a matter of systematizing the issues which can be necessary to you or the issues which can be taking probably the most of your time that you simply don’t need to be taking your time and giving it some inputs, some processes and a few outputs, after which offering some suggestions to maintain your methods dynamic and you may 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 won’t be the person who is the skilled in that space and that’s nonetheless tremendous. An excellent instance is like, you and I’ve been buddies for years and I personally realized rather a lot from you, particularly on the subject 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 about 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 probably the most easiest way, however proper now it’s like, hey, I simply despatched this zip code that I need to go after. After which there’s truly, I referred to 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 ought to 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 in order for you to check out that spreadsheet template, you may go to biggerpockets.com/sources the place Pasha has been gracious sufficient to share that with us. And so let the folks know the place they’ll discover you, Mr. Pasha.

Pasha:
Yow 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’ll find me.

Henry:
Nice. And you’ll 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 very best.

Pasha:
Thanks, sir. Have a superb one.