On this recap episode of the Elevate Your Equity Podcast, we took in all of the wisdom given to us by Darshan. We learned about timing of deciding to manage your own rentals, balancing or prioritizing out your buying investing and your day-to-day operations. Also, we've covered about the hardest part of the job in being a property manager and investor at the same time, the importance of outsourcing and relying on your team and recommendation for if you should walk on this same path.
Having Darshan Soni on the show led to some great lessons that we hope you can also take away.
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Welcome to the Elevate your equity podcast, where we, as married busy professionals, leverage real estate investing to unlock the three plus one degrees of freedom, help, location, time and financial. Hey, what's going on guys, this is Derek, and this is Sophie. And we're happy to see you guys again. And today we're here to recap, this incredible episode that we had with Darshan Soni, a property manager investor based out of Indianapolis. And one thing that I wanted to touch on real quick that I really enjoyed with this, and I hope that you as the listeners, will also take this into account is that he started off house hacking. And that was exactly what we did as well. You want to tell the quick story about House hacking, how that all went down.Sophie:
When we first got married, Derek was living in a house with three other guys. And actually, after we got married, we lived in we lived in the master bedroom. And so that was a form of house hacking that we did was but itDerek Clifford:
wasn't on the wrong side.Sophie:
We were the renters. Yep. So we were on our journey and find your own house, we found a house, I think we were just driving around neighborhoods, and saw this house and looked it was, you know, look like your regular three, two house. But over the garage, it looked like there was another unit. So as we were walking around, I think that day, we saw the tenants come home, I said, Hey, like, are you? You know, this house? We saw it for sale? Like do you know anything about this house being for sale, it wasn't listed yet. So they told us everything that we needed to know, we contacted the agent. And it turns out that this was a perfect opportunity for house hacking. We rented out the three bedroom, two bath house, we lived in the in law unit.Derek Clifford:
And yeah, the rest is history at that point. You know, once we once we moved into the house, like we stayed there for a good like, what, three years maybe. And then after three years, we were able to sell and then get our own place that was closer to work. A lot of different factors went in there. But the fact is that we ended up using this house hacking scenario as a way for us to break into the multifamily business and, and also like help vault our net worth. So that was really important.Sophie:
And I think we can share, you know, when we bought the house, it was about 698 We we did a lot of value add to it, where we put in a washer dryer in the garage so that each unit had their own washer dryer, we actually turned actually, when the main house, it was a three bedroom, one bathroom. Yeah, so we turned into a three bedroom, two bathroom. So that's something to think about when you are house hacking is not so much just going in and renting out. But think about what value you can add to the overall house for appreciation.Derek Clifford:
Incredible. The other thing that we talked about in there was when you're growing, you eventually come to a place where you can stop or systematize it and then make it something professional build systems to handle more, right. And that was a really cool thing. Because I remember looking back and figuring out that eventually, like I just tried to acquire properties as as they came right. And I was buying them based on market dynamics, I knew that they were going to do well and they were cash flowing. But I didn't really didn't like start taking off until I started systematically figuring out, okay, I'm buying this property because of this and putting more numbers to it, and then figuring out how to scale that out. And that's when I realized, oh my gosh, like we are in the wrong game, we should be in multifamily. So I think that that's a really cool lesson is that, eventually you're gonna have to get to a point where if you like what you're doing, you'll have to stop, assess what's going on, and then try to build it into something that can be processed and be able to do more capacity there. I don't know if you want to add anything to that No, completely agree. Okay. The third thing that I heard in this conversation is that property management is kind of like one of those black boxes like construction, where if you can figure this thing out, right, it's a huge place of value add. So what Darshan was talking about inside of our podcast was that if you can have that much control over your property and make sure that you're looking at all the operations from a day to day standpoint, you have so much more options and data and information to be able to say, oh, you know, the tenants are saying, when I go there that they would like to have a laundry service or have a laundry room in this open space. And if they did that, then they'd be willing to pay $50 more per door. If you are a good property manager, you'd pass it along to the owner. But if you were the owner and property manager and you hear that, that's like that's a great thing to be able to do. And then like construction, you know, construction, you'll be able to add incredible value to properties just because you can take a property that's falling apart and buy it for pennies, and then get it rehabbed, you know, to handle the stress of like managing the contractors and get all going. And so those are ways that you can really get a lot of value. You know, like you put some money in, you risk a little bit to make sure that you're in the operations or in the construction and then at the end you'll have a product that's worth more way more than the equity that you put into it to begin with. So that was a cool lesson number three, number four that I heard is that it's important for you to find PMS. Or if you're going to be doing this yourself same thing, that you got to use technology. And you got to be centered in new technology and be up to date on what's going on. Because if you're in the past, and someone is using a more sleeker, quicker system, then you're going to lose to that like, it's going to be a lot harder for you to perform at that level. One thing that I wanted to pass along that was kind of a concrete example of this is that there's a service where you can do self check ins to do showings one of the agents that we had back many, many years ago in Indianapolis. And in order to set up a showing for property, like you literally go to the door of the house, and there's like a QR code, or there's like a website that you go to. And then from there, it walks you through the process of taking a picture of your ID. And then once you submit your approval, you sign a document online on your phone, then it sends a signal to some server somewhere and then unlocks the key and allows you to go in and logs how long you've been in the property. So you don't even have to have an agent there. Or you don't even have to have someone there to show the unit, which is super cool. So all of that technology stuff is really an important piece. And the other thing too is that like, in our business, with Sophie and I, Sophie is in the entrepreneurial world as well in the medical space or in the wellness space. And she's telling me about all these really cool tech like tech tools, like otter.ai, which we're using for all of our podcast calls and all of our zoom calls, and it transcribed stuff live. And there's so much stuff that we can do with that. I don't want to get into it. But basically, the best performers in the industry are using these incredible technology tools. I don't know if you want to add anything about your mentors, or Dr. Isaac and his integrator and how they're doing stuff. But I think it's an important thing to be out on the tip of the spear when it comes to technology.Sophie:
Absolutely. And one thing to know is that a lot of us, you know, because information and technology is evolving hundreds of times faster than what we can keep up with is that we can some of us, like I'm speaking for myself, I can create stories around well, I'm not technologically savvy, you know, that's for them, not for me. But the reality of it is, is that technology is meant to make your life easier. And I know sometimes it doesn't feel that way, you know, step into that possibility of wow, this can really change my life automate my life, you know, and think about what you're already using on a daily basis. So if you're using online banking, email, all those things, that's all technology. And so just to simplify it and step into, like I said, what's possible? Again, technology is something that we can't avoid. It's in every industry now. And it's almost like you have to embrace it.Derek Clifford:
Yeah, totally. I couldn't agree. More, I just wanted to add to that.Sophie:
This was a wonderful podcast episode with Darshan, because we work with him personally in Indianapolis. And just seeing how he works and how He sets up His property management business. It's so important because as you need a team, this whole business wouldn't even work, if you didn't have a team where you can delegate and rely on someone who has all the systems and knows the technology. So if you yourself are nervous to step into it, rely on someone who does know it. Yeah. AndDerek Clifford:
you know, that brings me to my next point is that property management is it's a people based business, you have to know that, that that's at the heart of it, the best property managers are pretty much level headed when it comes to emotional situations. And so, if you're not that person, then I would not consider being a property manager, because you're going to have people that are really upset or really frustrated, because it's their home, that's flooding, or it's their home that they can't get hot water, right. And it's very time sensitive and urgent to them where for you, if you're not sharing that type of empathy, being able to listen and stand in all of that madness with Zen and grace, right? It's going to be very hard for you to be able to keep your emotions together and continue to do the business. So I think building a team that understands the people business, and that keeps a level head in the middle of all these crises and problems. That's a huge, huge thing. So know that that that's the way that property management is. It's a really hard business. And I really so thankful for all of our property management team, because it's something that's very hard. Either you love it or you hate doing it. And so we're glad to be finding the people that love doing it.Sophie:
You know, because we did it for several years ourselves. And so we understand, and that's one thing to do it yourself before you hand it over because it helps you appreciate the people who are doing the hard work for you.Derek Clifford:
Yeah, totally. And then the last point that I wanted to make that Darshan brought up was a buying systems early on. So if you're able to have the vision to be able to scale into something that more massive than what you have right now, and that's where you want to be invest in those systems right now, one thing that I can say that I did early on was Active Campaign buying Active Campaign. And I'm able to reap the rewards of that, because all of the things that I've been building up to that point, instead of having all of my contacts like brokers, and investors, and you know, insurance people, property managers, instead of them being all in like a Google Sheet, and they had to migrate over to something else, it really helps to have something built from the beginning, so that you can scale with it right, and you're already built into a system or you're put into a system that can scale with you right from the get go. Because you'll notice that as you scale in your business, you are only as fast as the slowest link inside of your business, if there's a bottleneck somewhere that bottleneck is, is holding up the entire train. So I love how he brought up that buying systems that make you look professional early on, is going to help unlock the key for you to open up a business faster.Sophie:
So and sometimes, you know, it takes a little bit of outside help to help bring awareness to sometimes where those bottlenecks are, again, going back to the fear of stepping into the possibility of using all the technology that is around us. That, you know that comes back to mindset, you know, and the willingness to experiment and to trust systems to trust other people to help you scale further and faster.Derek Clifford:
Yeah, love it. Love it. That is so awesome. And anyways, that is enough. Those are our main takeaways from our call with derision. And so please, if you want to listen to more, please go back and listen to that episode. Otherwise, that's all that we have for you today for this one. And so thank you guys for listening. This is Derek and this is Sophie. We're signing off and we will see you guys next time. Take care