Thanks for dropping by Safe Investing South Africa. I am on a journey to build wealth my way. For any questions or comments, feel free to contact me.

12 Sep 2012

OUTSOURCING IN REAL ESTATE

In my last job we had some training. The room was full of economists, maybe international relations specialists, legal brains, and other learned intellectuals. The presenter gave us some branded pens with a small bulb which gives a nice light when clicked. The boardroom lights were dimmed leading to our pens lighting even brighter. All men, and I mean ALL MEN in the room started dismantling their pens to get to the source of the light. They seemed to have lost all interest in the presentation. Yet all of us ladies were being supportive to the presenter, looking at the slides and nodding a bit to assure her that we were listening.

Outsourcing in Real Estate
Thanks to this bunch of men, that day I got a better understanding of my husband. Every time he wants to do some technical DIY home repairs without required skills, I let him. I never try to talk sense to him anymore because I know he will never be happy until he tries. And in some cases he succeeds, but mostly we spend on DIY supplies, then fail, then spend on outsourcing. At the end of it all, I maintain my nice wife status, smile and say "I'm so proud of you for trying honey".

The latest of our DIY then outsourcing dance happened last weekend. A few months ago a toilet mechanism of the second bathroom in our holiday home failed. (Apart from the repairs I wrote about yesterday). We decided to have the whole bathroom renovated and fixed all at once because we had planned on the renovation anyway. We actually tried to get builders to work on it without any luck. We got builders but they failed to supply quotes. Its tricky when you repair a home you don't live in. We never had enough time to beg the builders, contact new contractors, etc. So the bathroom was just not used for months. This weekend whilst visiting the place, we got a breakthrough. Our friend, who is constructing his own home agreed to have his plumber come fix our toilet for a few hours. Its at this point that it dawned on the Mr that he hasnt tried to fix the toilet first. There we were herding for Builder's Warehouse to get the toilet mechanism supplies. We got it and he failed at it, but we remained proud "we" tried.

The plumber came the next day only to tell us we bought wrong supplies. Another trip to the hardware and in less than an hour our toilet was as good as new. The morale of the story: somethings are better left at the capable hands of experts. When you are in doubt OUTSOURCE or CONTRACT the service.

As a property investor or homeowner you have to know how valuable your time is. You may be wearing yourself too thin doing what someone else can do for you in far less time. I love renovating but I do it without ruining my manicure. I’d rather be here writing this blog post than collecting my rentals. Hence I hire the property manager. I also hire freelancers here and there to help me out of sticky situations. I am trying to make use of more resources to free some of my valuable time. Many small investors like myself overwork themselves to a heart attack. Some don't think its wise outsourcing in real estate when you are starting out.

My Take on Outsourcing in Real Estate and what I personally Outsource:
  • Property management (but I help with marketing because I love doing that.)
  • Work on my bigger website
  • Graphic designing
  • Property refurbishing (I hire a project manager to get contractors). It took me too long to realise that I cannot deal with builders. I keep trying but it never works.
 My decision is sticking with the core business (investing) and stuff I love doing. If I don't enjoy doing something, and I'm not convinced I'll need that skill ever again, I just get someone who does it for a living. When done well, contracting can save money and time. Some of the real estate investors outsource pretty much everything, from negotiations to the resale of the property.
Like Tom Peters rightly puts it: 'Contract out everything except your soul'

6 comments:

  1. Hi Mbini,

    I read this post after my initial question and now understand you use project managers for your rehab projects. Do these project managers handle your projects from start to finish or do you just use them to get contractors and you supervise the contractors?

    I am working a full-time job and would prefer if my renovation projects are handled by the project manager from start to finish while I monitor the progress and focus on acquisitions. What do you think?

    What project managers do you recommend?

    Looking forward to hearing from you.

    Thanks.

    Regards,
    JJ

    ReplyDelete
    Replies
    1. I'm sorry to take so long to respond Josiah. I now have a reliable handyman that I work with on a project by project basis. He knows what I want. He gets me contractors for stuff he can't do.
      It's easier to deal with one person. But a project manager is usually very costly.
      Mbini

      Delete
    2. This comment has been removed by the author.

      Delete
    3. I'm sorry to take so long to respond Josiah. I now have a reliable handyman that I work with on a project by project basis. He knows what I want. He gets me contractors for stuff he can't do.
      It's easier to deal with one person. But a project manager is usually very costly.
      Mbini

      Delete
  2. My son was very uncomfortable because of the same problem then we started taking guidance by them and now he feels much relaxed than ever before!price check uk

    ReplyDelete
  3. Really amazing blog, I’d love to discover some extra information.
    financial freedom workshop

    ReplyDelete