Rental Portfolio Observability

As the portfolio of properties and units grows, it gets increasingly difficult to keep tabs on whether you're managing your portfolio effectively. Identifying issues in how your portfolio is performing gets much more difficult as numbers such as NOI, can wash out smaller details (e.g. "Landscaping in Thomasville properties is 50% higher than other similar properties"), or hide other details (e.g. "We have recurring spot charges for pest control in the Thomasville 8-plex")

At a lower number of units, you naturally spend more time and thought looking at these details, but as your portfolio scales, it gets increasingly more difficult to do so manually.

Scaling your Approach

As a part of scaling your portfolio, an important component is to ensure that you still identify actionable insights. I created Track My Rentals do to just this, so the examples I gave above are actually based on real situations that allowed me to take an action to save hundreds of dollars per month.

Example 1: Pest Control

Using Track My Rental's "Actual Cash Flow" measurement, we quickly identified a property that was under performing and quickly identified that the Property Management company had been doing "spot" treatments for in this case, a mice problem. This is a classic case of a Property Manager focusing on dealing with the immediate issue, a vendor that was perfectly happy to keep doing regular trappings. By having the aggregate view, it was clear that this particular unit would benefit from paying for a more comprehensive "pest proofing" the home by ensuring that all entry points to the home were addressed.

This of course, ensured that the tenant had less issues, and also reduced costs. These win/win situations are easy to come by having these insights quickly highlighted.

Example 2: Landscaping

As a way of reducing large "fix up" costs, we've decided to pay for landscaping across most of our portfolio (including SFH). This ensure that the property grounds stay maintained and looking good for our tenants. This in term ends up being a bit of a nudge for our tenants in terms of general upkeep. This has worked well for us as a general strategy, but once we had Track My Rentals, we were able to quickly identify a particular geo that had significantly higher landscaping charges that had increased over time. With that insight, it was obvious that we had 3 choices, a) negotiate or find a different vendor b) accept this cost or c) stop including landscaping. In this case, we found a different vendor who, *across* the geo ended up saving hundreds of dollars. Because the costs didn't stand out at the property level, we would not have noticed otherwise. This cost only stood out when we looked at costs by property manager.

And So Much More

The ability to quickly spot these trends, e.g. "Rental Portfolio Observability" allows for much faster identification of cost and revenue opportunities. Further, once we got through the initial set of insights, we've been able to make smaller incremental changes on a monthly basis, as new information comes in.