Whether you are an “old pro” residential landlordor a beginner novice, you will benefit from and enjoy Mike Butler’s”Landlording on Auto-Pilot.” This now-retired cop and his wife builttheir realty empire by purchasing mostly single-family rental houses, plus someapartments. Along the way, they developed management methods to minimize theinconveniences often caused by tenants while still delivering superior service.
“Your tenants are your employees” is the novelapproach Butler uses to manage his residents. Starting with the renting of thehouse or apartment, he trains his residents to pay the rent promptly and notcause problems. To accomplish this result, he rewards them for on-timepayments.
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Butler shares his basic belief that most tenants would buytheir own homes if they could afford to do so and if they had adequate credit.However, he acknowledges most tenants, at least in his class of rentals, arenot able or are not motivated to own their own homes.
He admits most of his tenant applicants have less-than-idealcredit reports, yet Butler desires to rent to these prospects unless theirsituation is unredeemable. As a retired cop, he explains how he has rented toex-convicts who became some of his best tenants after he leveled with them thathe knew their history but was willing to take a chance on them.
An interesting twist to Butler’s property management styleis he holds an annual Christmas party for his independent contractor suppliers,such as electrician, plumber, maintenance people, handymen, roofer, treetrimmer, and other vendors.
He started this tradition because, as a cop, he got invitedto many holiday parties. Although Butler’s annual party for his vendors costsless than $1,000, including dinner and open bar, when his properties need fastservice his vendors usually put him at the top of the list.
Another unique Butler strategy is for the property ownernever to tell the tenant he is the landlord. Instead, he always refers tohimself as the “property manager.” Although he usually makes quickdecisions on tenant requests, sometimes he has to say, “I’m just the propertymanager so I will have to check with the owner.” That gives him time tothink and to pass the buck if the answer is “no.”
One area where Butler is swift to act is when the rent isnot mailed by the first day of the month. The postmark is what counts. Butlerregales readers about how he once took over a property where the sellercollected the rents weekly in person. He shares how the seller told Butler hewould never get those tenants to pay by mail. Of course, Butler then explainshow he got them to pay on the first of each month by mail.
Longtime property owners will especially enjoy the sectionabout how to avoid rejecting a tenant applicant. Butler exposes many of thetricks used by applicants, such as forgetting to list an address where theywere evicted. Sometimes, he even drives by an applicant’s current address tocheck out their housekeeping.
In the chapter about how to handle “inheritedtenants” in rental properties purchased for investment, Butler emphasizeshow to handle both tenants you want to keep and those you want to move out. Herecommends always using written notes and letters to form a paper trail just incase a tenant causes legal problems.
Chapter topics include “The Hidden Tax Benefits,Especially If You Have a Job”; “What is Best? Houses, Apartments,Commercial Property, or Dirt?” “Never Call Yourself a Landlord”;”Your Tenants are Not Your Customers”; “The Many Hats You Wearas an Investor”; “What to do When You Have Too Many Units and NotEnough Tenants”; “Your Answering Service”; “YourApplication is Your Crystal Ball”; “Protect Yourself by NeverDisqualifying an Applicant”; “Removing Bad Applies the SafeWay”; and “You Really Can Get over 100 Percent of Your Rents.”
Is this book an automatic landlording program to rent housesand apartments without work and always collect the rent on time? No. But itprovides unique methods not available elsewhere. A bonus is the free rentalforms included in the Appendix and on the author’s Web site. On my scale of oneto 10, this outstanding property management book rates a solid 10.
“Landlording on Auto-Pilot,” by Mike Butler (JohnWiley and Sons, Hoboken, NJ), 2006, $19.95, 190 pages; Available in stock or byspecial order at local bookstores, public libraries and
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Copyright 2006 Inman News