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When I moved from Massachusetts to Texas, I learned real fast how to automate my investment business.
I was always too involved with the business and didn’t want to pay other people to do things that I could do easily. The problem became that I was spending far too much time doing mundane tasks instead of being focused on earning more money.
I was the classic person who always worked “in” my business but never worked “on” my business.
Once I began to automate my investing business, my growth exploded. In one year, I doubled my portfolio from the previous 5 years combined.
Sure, part of this is due to the fact that it takes some time to get established.
But a large part of that is because I spent more time focused on growing and less time on mundane tasks like maintenance and paperwork.
I break my business down into 3 distinct areas, but I’m in no way saying this is how your business needs to look.
I look at operations as the management of your current projects/portfolio. It’s an absolute necessity but it requires the most time and isn’t directly a revenue generating activity. I think this is the most cost effective category to automate first.
Most investors are pretty good at finding and maintaining their inventory but are really bad with the accounting and admin. Unfortunately, this is the stuff that will come back to haunt you.
Acquisitions are the most important part of your business. It’s also the only part of the business that generates more revenue for you. I would automate this last.
This is a pretty long article, so you can jump ahead to your area of interest.
Probably the most time-consuming part of being a real estate investor is actually managing the property. I’m not talking about cutting grass and shoveling snow (you should have outsourced that a long time ago).
I’m talking about dealing with tenant complaints, listing vacancies, scheduling showings, taking applications, scheduling/doing inspections, scheduling maintenance….ugh
I was a hands-on landlord for a long time. I would go to my apartments, fix things, talk to tenants, collect rent…you name it, I did it.
I was growing slowly but surely. I was happy with my progress, but it is frustrating when you spend most of your time dealing with your current buildings instead of finding new deals.
Then I decided to move to Texas.
Suddenly we had to hire people to do everything I was doing before.
…And my business exploded! I doubled my inventory in just over a year.
If you don’t automate the management of your business, you’ll never grow. You’ll spend all your time fixing problems and dealing with tenants instead of finding more deals.
The first thing that comes to mind is to hire a property manager. Of course, this is an option, albeit an expensive option. If you only have one or two properties in an area that’s far away from you, this may be your only choice.
The way I look at it – the management fee usually covers phone calls and a spreadsheet once in a while. Listing vacancies, maintenance, improvements, and anything else are all subcontracted and charged to you (with a management fee on top).
I wasn’t interested in paying 10%+ of my rent just to have someone else take the calls, so I follow a hybrid approach.
I chose to use Buildium for my property management software. It is by far the most comprehensive property management software that you can buy and it’s options are amazing.
Plus I can manage up to 50 units and still pay just over $100/month. It costs more or less depending on how many units you have.
$100 might seem like a lot, but it’s actually pretty cheap considering a property manager would charge me $3,000/month just to take phone calls.
Buildium also helps me coordinate directly with my handyman or other service people. I can have someone do inspections and send them via pdf, and tenants put maintenance requests through it as well (with pictures).
Tenants have an online portal where they can submit maintenance requests and also pay the rent.
This makes rent collection far easier. Instead of chasing down rent, you just have to let them pay online. You only have to knock on their door if they don’t pay.
Buildium can also keep track of your expenses, income, and produce the necessary reports.
Granted, not everyone will be able to get all their accounting needs met with Buildium, but I bet 80% of normal investors will be satisfied with it.
See my full review of Buildium.
I found this little gem recently. Over at Properlyrent.com, there are some cool free features for both landlords and tenants.
The feature I like most is that tenants can pay the landlord via automatic ACH monthly through Dwolla. It doesn’t cost the landlord or the tenant anything at all.
The tenant also has control over applications and credit/background reports. Many states don’t allow landlords to directly collect fees for applications, and there are laws about the security of personal information such as the tenant’s SSN.
With properly, tenants actually pay for the report themselves and then share the reports with the landlord after all the private information has been stripped out. The tenants also get access to it for 30 days, which means they don’t have to pay multiple application fees if they apply for multiple apartments.
When I started automating my real estate investing business a couple years ago, I really wish Properly existed. They are new to the scene and just started 2015. They have some new tools coming online soon, so make sure you check back from time-to-time.
You can’t have a completely automated real estate investing business until you’ve somehow managed to deal with contractors remotely.
SmartSheet is an amazing product that is recommended by both Microsoft and Google.
It integrates with Salesforce, Dropbox, DocuSign, Microsoft, Google, Evernote…and the list goes on.
You can get multiple people on your team working with it, track progress, and automate processes, and provide roll ups for reporting.
Every sheet is customization. You can add discussions and files and attach it to rows to keep things flowing and looking clean.
Plus, this sweet product only costs $10/month for basic users.
It was really easy to automate bookkeeping. I made a stack of receipts, left them on my wife’s desk, and they mysteriously disappeared that night. The greatest part – A profit/loss statement randomly appeared on my desk the following day.
I’m still not sure how it works, but I clearly have a magic desk ( ;-)Hi honey ).
All jokes aside, this was actually the hardest thing for us to automate. If your books are too complicated for Buildium, you will need to do two things.
Step 1: We started to automate this last year, we started by scanning all receipts and documents into PDFs then saving them on our Microsoft OneDrive. It’s like Google Drive or Dropbox, but it comes with our office 365 subscription and also has 1 Terabyte of storage. Yes, that’s 1024 Gigabytes.
Once we did that, we were on the fast track toward automation. Now any contractor can simply snap a pic of a receipt and email it to us, and we’ll just slide it over to the appropriate folder in the OneDrive. This saves us hours and hours worth of filing and managing paperwork.
Step 2: Outsource your bookkeeping.
You can hire a local bookkeeper that can spend a few hours or a day each week to do all your bookkeeping.
I was also able to find a great online bookkeeper called Bench.co. There are a lot of sites out there, but these guys really have an end to end product that can fit most businesses.
Once your records are all digital, you can really go either direction and be fine.
Are you still budgeting on paper…or perhaps excel?
Take a step up for $5/month and check out You Need a Budget. It is budgeting software geared toward the smaller end, so I would not recommend this for a person with complicated budgeting needs.
It will work if you are trying to track expenses for yourself and your first project.
I jump straight to advanced because….there simply isn’t anything in between.
Once you graduate from basic budgeting, you need to get QuickBooks or QuickBooks Online. There is simply no way around it (unless you get on with Buildium and hire a Virtual Bookkeeper). For the rest of us, we need QuickBooks.
I’ve been using Quickbooks for about 3 years now, and my taxes, accounting, and budgeting are far easier and way more advanced than it’s ever been before.
If you use QuickBooks Online, you can have access to an app that allows you to snap a pic of your receipts and save them automatically, rather than scanning and saving to your OneDrive.
Though this isn’t a full “automation,” we are saving many hours every week.
To be completely automated, you need to eliminate paper. After moving to Texas, I turned my entire business digital; I don’t maintain any paper documents anymore except a few super important documents.
There are a lot of cloud based options now, but I use Microsoft OneDrive which comes bundled with my Microsoft Office 360 subscription.
Sure, some of you are worried about storing everything on the cloud (me too), but I think this is the future.
Basically, I get the latest version of Microsoft Office on all my devices (awesome) and it comes with 1 Terabyte of online storage for free. I then add OneDrive as another folder on my computer and just drop all my files into it.
It syncs up with my computer in an interesting way and when accessing the OneDrive folder, it’s literally exactly like accessing a normal folder. It’s even available offline!
Then you install the OneDrive app on your phone and all your files sync across all of your devices. I can access any document, at any time, from anywhere.
If you receive a document that you need to sign, how do you get it signed and sent back?
Right now you open the file and print it, sign it, scan it, then email it back.
What do you do if you want to go on vacation? How to you remotely handle your real estate investing business? Do you own a portable printer and use an app on your phone to scan? I’m sure that’s convenient.
If you’ve ever negotiated a real estate deal, you know that you’ll send the same document around 4 or 5 times until it’s pretty much illegible.
Then you get that one agent or seller/buyer who just doesn’t understand technology, and every time they scan it in crooked or with black lines.
It’s just a disaster.
That’s why I got a Microsoft Surface Pro 4.
This is literally a 3-in-1 computer which let me throw away my laptop, desktop, and 2 tablets. Well, I actually gave one of the tablets to my daughter.
Anyhow, it can dock and extend the screen to your two monitors at your desk, or go mobile with the detachable keyboard. It also works as an amazing tablet.
But the really cool feature is how you can integrate the pen directly into any Office 360 program.
I can write a letter to a tenant and sign it in Microsoft Word.
I can sign pdf offers or a Purchase and Sale agreement, then email it back without ever printing it.
It’s just amazing. It has freed me from my office and now I can take my business anywhere in the world, simply because I own this cool little device.
If your business generates leads through mailings, yellow letters, postcards, or other mail, then you need to check out yellowletters.com.
You can simply upload your documents, your mailing list, and select what product you want, and they do the rest.
Oh, and if you use the Promo Code “EricBowlin” you can get 10% off your order.
It’s pretty cool because you can choose colored envelopes, simulated hand written yellow letters, post cards, flyers, anything you want.
If you don’t have a mailing list, you can buy one from them too.
It’s the ultimate way to automate your mailings.
When people have a problem, the first thing they do is hit the web and search it. So, if you want them to find you, you need to be on the web.
Sure, it’s cheap to start a website, but is anybody actually going to find it?
Trust me when I say this, a website requires a long-term commitment to researching keywords, promoting your site, creating quality content, and maybe you can get to the top of the search results.
But probably not.
Unless you are spending all your free time doing research about your site, you probably won’t learn all the intricacies required to get to the top page.
OnCarrot will set up your lead generation site based on the type of business you are running. You can choose from pre-made optimized articles, then schedule them to be published.
Once you select the content you want, simply edit the content to change the location and adjust the information to meet your goals.
Personally, I would edit the colors, images, and at least 50% of the content so when someone searches online and finds you and another competitor using onCarrot, yours will not look the same as theirs. Also, Google doesn’t like content that is duplicate.
If you already have a website up and running, then just grab their quick SEO Bible to help you work on some content and articles to help you drive traffic.
If you are too focused on making deals happen to study and become an SEO expert, then outsource it to a company like onCarrot.
The cool thing about doing research for an article like this – I get to find and try out some cool new things!
I discovered a “robo-advertising” agency named Needls that helps you create and target your ads. It’s hard to explain, especially for an advertising neophyte like me, so just watch this video.
I’ve played around with Facebook ads and it really is hard to produce quality ads that convert. Needls is supposed to help with this.
It’s also pretty cool that they scan and target individual people based on their activities. If someone is talking about not being able to sell their house and you are a house wholesaler, your ad should start targeting their feed.
But, it does start at $100/month. This is far less than an ad agency, but you need to make sure you have a dedicated marketing budget before you can justify this expense.
I don’t have all day to spend posting and tweeting every couple hours.
I definitely don’t have any way to engage with readers from overseas, since I’m asleep when they are awake.
So I decided to automate it.
If you use Twitter, Facebook, Instagram, Google+, or others to engage with your buyers, sellers, or other clients, you need to get on board with Hootsuite.
Honestly, I don’t know how they make money because I do everything for free. I schedule out an entire week worth of tweets and posts, then forget about it until the following week.
All I have to do is interact with people when they comment or share…which I like doing anyhow.
As your marketing systems with Yellowcards.com and onCarrot.com gets started it will take time to generate a continuous flow of leads.
At first, you can probably handle the flow.
As your marketing matures and begins to really churn out leads, you’ll need to automate your email follow up.
Step 1: write down the system you are using to screen and nurture these leads. Step 2: to automate it with MailChimp.
They offer a free entry-level plan that never expires. It’s not a 30 day trial or anything like that.
Once you get over a certain number of monthly subscribers, then you need to upgrade to a paid plan.
You can set up drip feeds and other automations to keep your list warm or further refine your potential clients.
First, you need to get my 48 free landlord forms. Inside there I have a screening card that will help you take information down and qualify leads.
Then, go hire a Virtual Assistant. There are a ton of websites, but I have used Upwork.com many times to get odd-jobs done dirt cheap.
I wish I had some cool software, app, or service to show to you, but this step is really quite simple.
With Upwork, you can definitely hire someone and pay them per screened lead or per phone call. Just start with the screening card I provide, then add to it to make it fit your niche and needs.
Now that you have someone else generating all your leads, taking your phone calls, answering your emails, and screening deals, you need to manage the relationships so no one slips through the cracks.
If your fairly large or sophisticated, you can use the leading CRM tool out there, Infusionsoft. If the $200/month starting price tag is too much for you to stomach, you can also try out Insightly.
Insightly is also a ffeature-richCRM tool starting at $0/month, but you’ll probably end up on the $15/month plan pretty quickly.
I don’t deal with enough people to need a CRM tool, so I won’t go into crazy details on it. But I have needed to use CRM software in the past when I was doing business that involved a lot of leads and clients.
Client: “Let’s set up a meeting or phone call, when are you available?”
You: “I have Tuesday afternoon and Thursday morning free.”
Client: “I can do Tuesday at 2, or Thursday afternoon”
You: “I’m already booked at 2 on Tuesday, can you do 3?”
Client: “No I have an appointment at 3, how about Friday instead?”
I know you’ve done it. You spend so long scheduling the meeting, you could have just had a meeting instead.
Or, you can crowd-source your schedule. With Calendly you can send your schedule to your client and just have them block off the time that works for them.
You can embed it into your website, integrate it with Gmail, Mailchimp, or others, and it’s free (or $8/month for all the features).
I’m personally not at this level yet. I don’t spend a ton of time writing offers, plus I spent time as a real estate agent, so I can easily do my own CMA pretty quickly.
If you need a quick refresher on how to do a CMA, check out my article on doing comparative marking analysis.
If you’re a high volume real estate investor, you definitely need to automate this, or at least speed it up. So, if you’re spending a ton of time on CMAs, or just need some help, here are a few options.
If you are generating a lot of sales, you may be able to get an agent to do your CMAs for you. The easiest way to automate anything is to simply hire someone to do it.
There are a lot of agents that are very good at doing the numbers, but don’t have a strong referral base. They may be looking to do some side-work to make ends meet.
You could easily find one and offer to pay a fixed fee per CMA. You’d get reliable results even if it is the most expensive option.
Software can help speed up the process for you, even if it doesn’t completely automate it. I have found a couple full featured subscription based sites that can help.
These products are generally used for presentations, so you will be paying to make it pretty, but it does provide the framework for you to make quick and easy CMAs.
Plus, they have free trials.
I don’t think I would personally automate this part of my investing business… but I know people who have. Then again, I’m a buy and hold real estate investor. I buy less often and want every deal to be great.
For those of you who are wholesalers or high volume flippers, you may want to automate making offers.
You could hire someone to do it based off a spreadsheet you made. Problem is, you’ll be giving out all your numbers and secrets to anybody with the spreadsheet.
Your secret sauce will be safe while you can hand it out to a select few individuals with a company tablet or phone.
They can take the data off the calculator and pop it into offers before sending them out.
Logically, automating offer making should come last, but I decided to close out with IFTTT. The reason is because you can automate just about anything that you do on your computer.
Just think about your tasks in a logical fashion and build the task.
The only limitation is that you need to do something with a supported application (there are almost 400 of them).
It includes the basics like email, Twitter, and Facebook, but it even includes integration with appliances, your car, or air purifier.
I covered a lot here, but I can’t cover it all.
I’d love to know what you are using to automate your business! Add your comments below.
Eric is an investor that achieved financial independence at the age of 30. He started in 2009 with the purchase of his first triplex and now owns over 470 units. He spends his time with his family, growing his businesses, diversifying his income, and teaching others how to achieve financial independence through real estate. Eric has been seen on Forbes, Trulia, WiseBread, TheStreet, and other financial publications.
I started out as a full-time student, over $60,000 in debt, and didn't even have a full-time job (two part-time jobs). Learn the system I used to create a 6-figure passive income.
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