The problem with real estate is that you have to deal with a fair amount of short term pain to get the long term gain.
You literally have to be ready for ANYTHING. Doesn’t matter if you own one rental condo, a dozen single family homes or twenty apartment buildings.
You always need to expect the unexpected to survive in this business.
We never forget these wise words,
“You don’t make money in real estate by timing the market. You make money in real estate by time in the market.”
Here’s the thing…
If you want to secure your own financial future, in today’s world, you BETTER be taking an active role in planning for it.
We care a lot about the people with work with.
We do our very best to guide them very carefully to make wise real estate investment choices.
The type of choices that will have the least impact over the very interesting financial times we’ll be experiencing in the next few years.
But there’s more to real estate than picking the right property.
Investing in real estate is much more like owning and operating your own business then it is investing in a stock or a bond.
You never know what is going to happen or when it will strike.
Case in point … and this is a true story:
About six years ago I was working at software company and it was right around this time of year.
I remember because Best Buy had its Christmas decorations out … more on that in a second.
I was out for a festive lunch with some colleagues at a Irish Pub in Mississauga, Ontario enjoying some Bangers and Mash when my phone rang.
It was a tenant from one of our student rental properties calling to report that the water heater had stopped working.
Not knowing who they were dealing with and that Nick and I are real estate super heroes in our own minds … this didn’t phase me at all.
I quickly got on the phone with the water tank rental company to get this all sorted asap.
They inform me that its busier than usual at this time of year but they should have someone there in a matter of hours.
I called the tenant back and calmly informed them that the repair guy was on his way.
A little while passes and I’m still chatting up a storm at the Irish Pub when the repair guy calls with a problem.
Apparently the space between the wall in the basement and the existing water heater is a bit tight for them to wheel in the new larger water heater so he wants to know if he can take the drywall wall down so they have more space.
Now … on the other side of this drywall wall is a student’s bedroom so naturally I don’t want to do this.
But the repair guy states that if we don’t take the wall down he’ll have to wait for another guy to help him and they’ll have to reschedule the appointment.
So I ask Mr. Repair Dude to pass the phone to the student to get his OK.
I confirm that I will have the wall put back by one of our repair guys as soon as the water heater goes in.
At this point I’m selling him on the idea because all seven students in the house are out of hot water and it’s like -5 degrees outside.
The student agrees with the idea and the repair guy carefully takes down a drywall wall.
Looking back this would prove to be a very bad decision on my part.
I make my why to Best Buy to do some Christmas shopping when a new rental hot water heater repair guy rings my phone.
He claims to be the guy that turns on the gas again. Apparently not every repair guy is allowed to turn on the gas … only licensed gas fitter guys.
But there’s a problem…
He proceeds to tell me that because the hot water tank is in someone’s bedroom that there’s no way he’s turning it back on.
That even though the water tank is a good distance from the actual bed because there’s no wall separating them he considers it to be one room.
I calmly explain that the only reason that the water heater is in someone’s bedroom is that his repair guy friend ripped down the wall because he need to wheel in a new heater.
This new guy says something like … “I don’t care, this is against code, I can’t believe you have seven people living in this house anyway … this is crazy. I’m calling this in and you’re not getting this turned on.”
I lose it! I’m literally walking around Best Buy SCREAMING at this person.
Not my finest hour.
And for those of you who don’t know me, I’m a very calm person … I rarely scream … like ever.
But when I do I’m like Hulk Hogan ripping off my shirt as I lose it.
I was fired up, my veins were popping out of my neck and my forehead and right at that moment a friend that I haven’t seen in at least ten years walks by as I’m doing laps in Best Buy screaming my head off … I put on a fake smile and wave and then get back to sreaming.
It was ridiculous and I’m not proud of that 15-20 minutes.
Anyway, I hang up … call Nick with the ridiculous update and then get on the phone with a supervisor that explains that the repair guy was right, they’re not going to turn on the gas to water heater while it’s in a bedroom.
I state that the student will sleep in the family room that night if they’ll do it. Or, if they prefer I’ll pay to have him stay in a hotel and I’ll rename that room “the storage area”.
This proves to be unconvincing to them.
Then the water heater repair guys states that they’ll need the wall to be re-built with more studs than it has now. Slapping up the old piece of drywall isn’t good enough.
Apparently when the took the wall down the drywall was being held up by the top and bottom only … there were no studs (pieces of wood) in the wall. So they would need a better wall built before they turned on the gas.
We bought the house from an older genteman and had spent tens of thousands renovating already but we hadn’t checked that this one little wall “had enough studs in it”.
It was all rather ridiculous.
And to make matters worse the “gas guy” was so busy he can’t come back for three days.
At this point after much more yelling I call the students and offer to pay for them ALL to stay in a hotel for a few nights.
They turn it down and state that Nick and I have been great to them and that they’ll gladly shower at the gym at school until the problem is fixed and would let their parents know what was going on.
We go into massive action mode.
It was Friday night at this point and none of our contacts could come out to build this wall.
We convince an old friend who is handy with this type of stuff to come out with us on a Saturday evening to replace that wall.
None of us wanted to be there that Saturday evening.
But it got done.
On Monday the gas was turned back on and the house had hot water.
It was not the most relaxing weekend.
But there is a tiny bit of good news….
Over the last six years, since “the event”, that property has earned us over $180,000 in gross rental revenues and appreciated in value by about $70,000 dollars.
When my son goes to University that property will likely be completely paid off, the net revenues for the property will be huge and Nick and I will have a great cash flowing asset on our hands.
So is it all worth it?
Did we learn a few things from that event? Of course.
Did we handle things the best we could. Probably not.
But here’s the thing.
We didn’t let that situation distract us from our long term goals.
Too many real estate investors face a little situation like that and immediately want to sell their property because it’s “too much hassle”.
Today we look at handling stress as a competitive advantage.
We’re not perfect at it but we do our best to never let short term pain distract from long term gain.
To live the life we want requires work, we know that and we’re not scared of it.
And looking back this incident seems like no big deal at all … but at the time it felt like the end of the world.
Hopefully sharing this little escapade of ours gives you some strength to battle through your next stressful adventure!
And if you see me screaming in Best Buy please let me know what a fool I’m making of myself!
Until next time … Your Life! Your Terms!