We are proud to kick off 2021 with the “Best of Brainstorm”, snippets from our top guests of 2020.
[3:48] Episode 42 featured Andrew Smallwood of Second Nature, who knows a lot too about why air quality is so important in rental properties.
[5:35] In Episode 44, our guest was Citizen Home Solutions, featuring Peter Hernandez. Citizen provides a concierge onboarding service for new tenants to get their utilities setup.
[7:27] Perhaps the most inspiring conversation of the year was Episode 38, with Mayor of San Diego, Todd Gloria, addressing the housing crisis and being the first person of color and openly LGBTQ to be elected Mayor of San Diego.
[10:32] A super knowledgeable person in the area of landlord-tenant law, Tracey Merrell of Kimball, Tirey, and St John, joined me for two Episodes, 37 and 40.
[12:04] A hot topic last year was “process automation”. Jordan Muela from Lead Simple joined me in Episode 47 to discuss automating property management processes.
[13:50] Diving deeper into the topic of automation of property management processes, Heather Park from RentBridge joined me in Episode 48.
[16:00] Our NARPM National President, Kellie Tollifson joined Bob on Episode 43, openly sharing some of her challenges in building her property management company.
[17:40] Discussing an innovative approach to managing Security Deposits, Episode 39 featured Casey Winter of Obligo.
[19:34] The topic on Episode 48, was accounting with Taylor Ho from APM Help. Taylor explained best practices for clean for trust accounting.
[21:45] Finally, Ethan Lieber of Latchel joined us on Episode 33. Ethan explains Service Level Agreement (SLA) in running your maintenance program and shares a fun personal story.
A time-stamped, full transcript of this episode is below.
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North County Property Group
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Bob Preston: 01:04 Hello, and welcome to all you brainstormers who are listening in today. This is Bob Preston, your host of the show broadcasting from our studio at North County Property Group in Del Mar California. If you're new here, please subscribe. So you have ongoing access to all of our great episodes. And if you like what you hear, please pay it forward with a positive review. I am so excited to be back here to kick off 2021. This is our first episode of the year, and it just so happens it is our 50th full episode of Property Management Brainstorm. I can hardly believe that now talking about our full brainstorm episodes here, which always feature a guest and I'm not including in that count our bonus weekly episodes that I call Five Minute Fridays. Coincidentally, our 50th Five Minute Friday will also be posted this week and that will be in total our 100th episode. Pretty crazy looking back on the past three years, it's just amazing to say Property Management Brainstorm has published a hundred content packed episodes. I just thought it would be great to celebrate our 50th full episode by bringing you what I'm going to call the best of brainstorm. Some snippets of the best guest conversations I had in the year 2020. So, before I get into that, I'd also love to share some fun facts from the past year about the episodes we published in some of the statistics behind that. So first of all, we published over 16 hours of content in 2020, that totals about a thousand minutes for your listening pleasure. And in total, we had over 37,000 downloads for the year. Wow, that is fantastic. San Diego was our most popular listening city. I guess that makes sense, because this is where we're located. And San Diego had 636 episodes downloaded just in our little Metro area here in Southern California. North America is where 92% of our listeners reside. But we had also listeners from as far as South America, Europe, Asia, Oceana, and Africa. Our most episode popular this year was number 33. And that was with Ethan Lieber of Latchel talking about establishing a service level agreement SLA, and that was downloaded more than 1800 times. We're going to hear a little snippet from Ethan here in a bit. Our most popular Five Minute Friday was number 31. And that was all about our satisfaction guarantee. That was downloaded 440 times. And it's interesting to note that fans of property management brainstorm listened most using Apple podcasts, 43% of the time and on an iPhone 54% of the time. So that's just fun, cool stuff, right? Well with that, let's get on with today's show and countdown, the best of brainstorm for the year 2020, all of these guests were fantastic kind of a countdown format, but it's not based on quality of content or anything. I just had to put some order in it. So here we go. Let's start with a clip from episode 42, which was published on August the sixth. And it featured one of my favorite guys in the property management industry, Andrew Smallwood of Second Nature. Andrew is one of the most genuine individuals you'll ever meet, super generous with his time and his knowledge. And he was kind enough to come on the show to talk to us about air filters and the importance of air quality. When it comes to managing rental properties, let's have a quick listen to Andrew Smallwood and some of the things he had to say.
Bob Preston: 04:17 What’s the issue air filters are your cornerstone. Why are air filters so challenging? And what's the big deal?
Andrew Smallwood: 04:23 Yeah, great question. So the problem that we solve of getting air filters changed on time is one that a lot of people can relate to. If they've, you know, had to go to a store to purchase an air filter or have simply forgotten to go to a store to purchase an air filter until it was a bigger problem. It's one of those out of sight out of mind issues. And we just realized kind of the breakdown points. Bob are, uh, somebody doesn't know their size or they don't know the quality to buy. We can get into some of this later, but, uh, they don't know how frequently to change them or they forget any number of these things in the case of tenants that some of them don't remember, it's their responsibility. One of the many things outlined in their lease that they're not reading after they sign it. And, um, ultimately we just, we started asking and property managers asked us, they said, Hey, I got your service from my own house, but how can you help me get tenants to change their air filters on time? And how could we do that? And so we kind of just addressed those different failure points and said, what would be the perfect way to solve those in a cost effective way?
Bob Preston: 05:34 One of our newest partners at North County Property Group was featured in episode 44, Citizen Home Solutions with our guest, Peter Hernandez. Citizen provides a very cool concierge onboarding service for helping new tenants get their utilities set up. And Peter is also an amazing advocate within the property management industry for staying healthy, eating well, getting lots of exercise. He facilitates a really cool Facebook group called PM health. And here is a snippet of my conversation with Peter
Bob Preston: 06:06 There's utility services, I think kind of how you described it. So maybe you can say that again and tell us what exactly that means.
Peter Hernandez: 06:12 See or utility service. Absolutely. So we, we try to, uh, best way to best way to explain it is, uh, as we always like to refer to ourselves as a, as an extension of, of our partners and their business property managers. Right? So, uh, we, we like to say that we, we like to handle the, the moving experience for all of the residents or tenants for property managers. So, uh, utility concierge means that we we're here to assist in every way, shape or form, uh, assist that resident as they're moving into their, through their new home. And I always like to think about it as you know, in, in this industry, we, we travel a lot, right? So, uh, we, we all have been to a hotel where someone comes up to us and welcomes us and maybe will ask us if they can take our bags or if they can Bally our vehicle or whatever it might be. Uh, and so it's their job towing the hats that, that welcome, right, to enhance that experience as you're, as you're getting there. And so we'd like to definitely think ourselves, think of ourselves as not a, not as a utility provider in any way, or a utility set up company, but more of a concierge service. So we're there to assist and enhance that, that moving experience for them.
Bob Preston: 07:27 Perhaps the most inspiring conversation I had this year was episode 38 with my guest Todd Gloria. At the time Todd was a California State Assemblyman, but in November was elected to now be our Mayor here in the city of San Diego. Todd spoke about dealing with the housing crisis and one of the most expensive real estate markets in the country. And he also spoke about the road to being the first person of color and openly LGBTQ to be elected mayor of San Diego, quite an inspiring story. Here's a clip.
Bob Preston: 08:02 You have a vision to put a roof over every person's head at a price they can afford. I mean, that's a very ambitious plan, of course. And, um, I know it's a complex issue, but what will we need to do as a San Diego community to see that vision become real
Todd Gloria: 08:16 Well? It's going to be a lot of hard work and yes, it is a lofty goal, but I think leaders have to set those goals and work aggressively to reach them. Um, and it, again, it goes back to your kids, uh, to my nieces and nephews, um, that, uh, you know, there has to be a place for them. And so that means that we have to increase the amount of homes that we are producing in our community. Again, not building anything anywhere, but focusing the kind of housing product near existing infrastructure and jobs. And how do we do that? Well, first off you have to have a leader that says, this is a problem, right? And sometimes that's been something of a key difference in this campaign, um, where, you know, I've been very clear in saying, I believe our housing crisis is the most significant issue. I believe that homelessness is an expression of our housing crisis. Um, but I, while we talk often about the 7,000 or so unsheltered people in our County, my mind is often on the hundreds of thousands, if not more than a million families who are housing insecure and who don't know if they're going to be able to make it here, those are the people who are not seeing, because they're not laying out on a sidewalk or in a Canyon, but they are equally victims of this housing crisis. And so what I'm trying to lift up is, Hey, we can do more and we should do more. So there's that leadership piece. And then you operationalize that by doing things like, um, running the development services department in a customer service oriented way, making sure that we are holding people accountable, giving them objectives and goals and managing them to meet those goals that we're passing, that we're appropriating our limited taxpayer dollars to do things like update community plans, uh, which provide that certainty of process because it creates a consensus from the community and from the development industry about what goes, where, and how that ought to look and that certainty of process against helps to speed production. Um, and, uh, uh, and then I think it is going to be incumbent upon the next mayor and really any mayor, because this is a national problem, their housing crisis across the nation, but on any merit to say, this is the issue I'm going to commit to working hard on it. And again, my career as starting as a housing commissioner to my service as the chair of the housing committee at the city, uh, to my service on the housing committee in Sacramento now, um, I believe I have the wealth of experience and background to be able to make transformational change on this issue. If elected mayor.
Bob Preston: 10:31 One of my fellow board members in the California state chapter of NARPM and a super smart person in the area of California landlord tenant law is Tracey Merrell of Kimball, Tyree and St. John. She joined me for two episodes this year, episode 37 and 40. And here is a clip from Tracey speaking about some of the 2020 California legislative updates pertaining to landlord tenant law. The new law that perhaps has received the most attention is the Tenant Protection Act of 2019 might be well beyond the scope of the podcast. But if you can give us the best overview that you can, and I'll certainly provide a link in my episode notes for further reference as well.
Tracey Merrell: 11:13 AB 1482 was a presentation that I had given several times prior to 2020, and then during 2020, it was the biggest thing prior to COVID-19 that I was teaching people about. And essentially what it is is it is statewide rent control, and it is statewide eviction control. Um, you are going to be subject to this law unless you meet one of the express exemptions. If you do not meet an expressed exemption, then it covers you and your property. So you have to make sure that a you're providing the correct rent increases and B that if you decide to terminate a tenancy, you have a reason and you state one of the specific reasons under 1482, that's essentially what it is.
Bob Preston: 12:01 One of the hot topics this year buzzing through the property management industry was process automation. I had two guests on, in 2020 to discuss this topic, Jordan Muela from LeadSimple, joined me in episode 47 to discuss their new operations module for automating property management processes. Here's a bit from my conversation with Jordan. Let's talk about property management specifically, then why is process so critical on property management?
Jordan Muela: 12:29 Lots of great questions in it, yours kind of wonder, well, what is unique or special about this industry? Obviously we all know that it's complex and there's a lot of challenges. Is it any more or less complex than other industries have thought about it over time that there are fundamentally more moving parts here than in other industries, the constituencies, the frequency of events taking place, the flow of communication from multiple parties. There really is a lot of dynamics going on here. I think where the real wants is understanding what can be systematized in a process that is let's call it rigid to the point of saying, you must do it this way. What aspects of it are fundamentally dynamic things that will always be a matter of if you hire a monkey that does not have the ability to implement judgment properly. I think teasing out the nuance of those things is really the difference between being able to effectively implement systems versus being versus believing that everything has to be decided on a one-off basis and no standardizations.
Bob Preston: 13:48 Turn to the topic of automation of property management processes. Heather Park joined me from RentBridge in episode 48. Heather had some very valuable insights to offer about automating certain aspects of property management. Let's have a listen to Heather. For those who might be new to this topic, It's a bit abstract. I don't know if you ever hear that. So are there some concrete examples, maybe even simple ones that could help us understand exactly what you're talking about and what this is?
Heather Park: 14:17 Absolutely. You know, one of my favorites, um, is the renewals example. When we were running about a thousand doors, we had a full-time staff member and a half. So calculate that that's 60 hours a week doing nothing but renewables and expirations. So take that example and then look at the today's scenario of the way that we automate it. Lisa knows can be done in a matter of moment. So if you're working through a traditional lease renewal, what's the first thing you do. If you get owner approval, you call the owner. They're not going to answer, answers their phone. On the first time you leave a voicemail or you send a text message or you send an email and then you're waiting to hear back from them. Okay, great. You hear back from them then what, and that's the series of questions that just kind of flows from there. Then what, then what let's say they want to renew. Okay, great. Now I've got to get ahold of a tenant and make sure that they're okay with the new rent rate, et cetera, et cetera, et cetera. It's a back and forth all the way through the yes. Side of the scenario and all the way through the no side of the scenario with all of those different branches. Imagine how many phone calls on average, it takes someone six attempts to get in touch with a human that's, maybe three miles away and three-year way or maybe five and one. It just depends on on the day and the time, but it's never an easy situation just to get another human on the phone or to respond to an email or, or a text message or however you do it. So we look at it from the automation standpoint. And the example that I really like to use with renewals is the elimination of all of that waiting and back and forth. So our renewals process kicks off automatically from the export of data from your property management software,
Bob Preston: 15:59 What a pleasure it was this year, having the national president of our National Association of Residential Property Managers on the property management brainstorm show. Kelly Tollifson joined me in episode 43 for a delightful conversation, openly sharing some of her experiences and building her property management company in Washington state. Let's hear from Kelly, has that been part of the challenge, finding the right people to fit within your company culture and your high standard?
Kelly Tollifson: 16:28 Huge, we weren't hiring the right person or there was somebody else looking for something else. And I don't know if it was a function of the unemployment rate because it was so low through that period of time, 2017 to 2019. But we had an major shift in our company benefits. We started a fun committee. We really, I really started focusing on culture because we were meeting the salary requirements of people, but there was just something I'm not sure if it was us or them or what it was or the combination of everything, but yes, keeping the right people on the right spot, the right seat on the bus has been really difficult. And I have to say right now of all the work we've put into it as a team and myself and the, you know, the books I've read, you know, the, then the networking I've done within NARPM and so on. Um, I think we're in a really good spot now and have a great team and we're all rowing in the same direction. And we're all seeing the same vision and it's really been hard work to get here. But I, every day I crossed my fingers, hoping that I won't, the Apple cart won't get upset.
Bob Preston: 17:34 Another one of our new partners, and also one of the more innovative approaches to managing security deposits. My guest on episode 39 was Casey Winter of Obligo. Here's Casey explaining the basics of obligation, no security deposit option for tenants moving into a rental property, describe the whole workflow process and how it works.
Casey Winter: 17:57 Yeah. So from starts, um, to end, the beginning piece is after you have approved the tenants, your credit check, and it is now time to collect the deposits. And the first month's rent management companies charge, lease admin fees and additional fees upon moving. We facilitate all those payments. Then your leasing staff would spend about a minute or two punching in the contact information and the required dollar amounts for each category for that new tenants. What's the security requirements. What's the first one's rent, what's the lease admin fee. And so on the tenant will then seek receive an email from obligate. They will go through our workflow. They will have the option to go to posit free or pay a normal deposit. Once they are done, we email both parties. We notify property staff that the tenant has completed. The process. You can now move forward with your next steps on getting that tenant moved in fast forward to the end of the lease. Tenant moves out. You do your move out evaluation. You figure out any deductions that you need to make you then log into obligate. And you're going to create a charge against their billing authorization. You can itemize the charges. You can attach your own PDF document that you might already have with photos and receipts. You're going to hit submit that'll trigger a payment for the amount from Obligo to the property. We guarantee up to the pre-agreed cap that was decided upon moving. What's the security that we're guaranteeing. And then we're going to pay the property first and send an email to the tenants with the bill saying, here's the bill from XYZ property management paid the bill for you.
Bob Preston: 19:34 Property management accounting is always a topic of interest on this show, and we were not disappointed by our guest on episode 48, Taylor Ho from company called APM Help. Taylor explained some of the key areas for keeping your books and accounting practices clean for property management. Trust accounting, let's hear with Taylor had to say in the state of California, we call the DRE, the department of real estate. I'm not sure of the actual term in the other States because I'm a broker in California, but we are subject to audit by the California Dre, what are they going to come looking for?
Taylor Ho: 20:10 Bob, I should notate here a big, you know, my experience or what my firm's experienced and is the trust account, the financial side of these audits. They can come after you for other things that are nonfinancial, but I'll focus on the financial piece. They always ask for, show me your bank recs, right? If you're not doing bank recs and you're not doing it monthly, you've got a problem. Right? Um, so usually in a routine audit. So when I say routine, meaning this is a random audit, right? You just got, you know, you got the short straw or whatever it is, right? This is not an audit for cause a routine audit. The first thing they are going to ask for is show me your bank racks. The one thing that a lot of PM companies don't understand is they'll say, Oh, here are my bank recs. Unfortunately you have to provide more than just the bank recs. Um, the bank recs is one thing, but then obviously it has to tie with your statement. Um, and then when you really start looking at these bank racks, right, and this is the same thing that we do with every new potential client of ours. Like we look at the most recent bank rack and we pick it apart because that is exactly what an auditor is going to do as well. And the first thing, the most important thing outside of being able to provide that bank rec the report itself is do you have any unclear deposits?
Bob Preston: 21:40 And finally, today we're going to wrap up with a fun snippet from my conversation with Ethan Lieber of Latchel and episode 33, I already let the cat out of the bag that this episode had the most downloads of any other this year. Ethan explains the importance of a service level agreement when it comes to running your maintenance program and shares a fun, personal story along the way. And I always like to ask my guests, as we wrap up to tell us a quick story, if you will, maybe it's something that was a big impact in your life, either personal or professional. And is there a story you're willing to share with us today?
Ethan Lieber: 22:15 We'll make us a little more cinematic. And I think it comes down to the importance of like grit and perseverance. I'll start with my first interaction here on this. So the first job I ever had, I was actually working for my father. He is a real estate agent in high school. And my dad put me on there and said, you're going to make a hundred calls to expired listings every day. And book me appointments to go relist the home. That's like the first time I ever really liked did any kind of meaningful work, right? That's a tough, tough job. I was like 15. When I started this, it was building that grit and perseverance where I think it put me in a position to realize that I was capable of doing entrepreneurship because I think anyone that runs a management company knows how hard it can be to be an entrepreneur every day, you're climbing an uphill battle. Um, and at some point you hope like it feels like you're gliding down Hill, but you also probably know intrinsically that as soon as you feel like you're on the downhill climb, does that mean you're actually missing something right? Does that mean actually you've gone, you've gotten comfortable and that someone else is going to pass.
Bob Preston: 23:35 Hey, I really hope you've enjoyed this today. As a review of some of my top guests from 2020, these are all, some of the top minds in the property management industry. I would encourage you all to go back and listen to the individual episodes because each of these guests had so much to say, and they share so much fantastic knowledge. I expect 2021 will also be a robust year and I'm thrilled to be back bringing more valuable content to the property management industry. As we wrap up today, I'd like to make another quick plug to our listeners to click on the subscribe button and give us a like also please pay it forward with a positive review to help encourage more great guests to come on the show that concludes today's episode of the property management brainstorm. Thank you for joining until next time we will be in the field, working hard for our clients to maximize rental income and property value while maintaining top tenant relations. And we'll catch it again.