Peter Lohmann's Podcast
00:42:53 · Peter Lohmann, Matt Luke
[00:42:53] S0: to [00:42:53] S1: one specific unit. So that's gonna include carpet cleaning, maintenance work that might need to be done, cleaning, paint touch ups, whatever. Yeah. I think those are the main categories. And so then that triggers that project in Property Meld and all of the vendors get a work order at one time. It also includes a work order to our vendor who does the inspections. So the vendor does the inspections in the work order. I remind him to try to get there in about a day or two from the time that he received the work order. And then he goes and take... Then he'll take pictures of the property to document the condition when the tenant moved out. Around day nine, that vendor also has a separate work order that asks him to go back and take pictures after the vendors are done so that we have pictures of the post work and then pictures archived for the new tenant moving in. [00:43:52] S0: Okay. So is that vendor also, like, calling the owners to talk to them about the scope? [00:43:58] S1: You know, we don't actually do that. [00:44:00] S0: You just [00:44:00] S1: We just just take care of it. We have very few that would go beyond the limit where the deposit doesn't cover the turnover. So we don't have to reach out to the owner because the tenant is covering the cost of that turnover. [00:44:19] S0: So the deposit... So you're saying you have very few turns that exceed the amount withheld from the deposit? Correct. Wow. That's really surprising.
00:44:19 · Peter Lohmann, Matt Luke
[00:44:19] S0: So the deposit... So you're saying you have very few turns that exceed the amount withheld from the deposit? Correct. Wow. That's really surprising. [00:44:29] S1: Not all of them. I mean, there are times for sure, but but most of them fit within that deposit range. [00:44:35] S0: What about when, like, the deposit gets returned basically in full or nearly in full to the tenant? Mhmm. Yeah. You still gotta paint, carpet cleaning. Like, there's a lot of stuff that you can't charge the tenant for. [00:44:49] S1: Yeah. Trying to think of a scenario like that. I I think we've also built up trust with their owners to get the turn units flipped. [00:44:57] S0: Mhmm. [00:44:58] S1: So we really don't have to reach out to the owners to have a conversation if it goes beyond the deposit. So far, the vet owners have trusted us to just make the right decision and get Okay. It Now we have had a couple retention issues on owners who feel like we're investing too much into their property. Mhmm. And we've let those fizzle out. What I try to articulate to owners is that when we take care of your property the way I take care of mine, you're gonna increase appreciation, you're gonna have less deferred maintenance, you're gonna have better tenants, your property is gonna be worth more when you're ready to sell as opposed to the situation you may be in now where there's a lot of work that needs to be done and you're losing value in your property and attracting poor tenants. [00:45:44] S0: Yeah.
00:45:44 · Peter Lohmann, Matt Luke
[00:45:44] S0: Yeah. [00:45:45] S1: So if an owner doesn't wanna keep up with their property, we'll do our best to explain it to them. But if they fizzle out, that's okay. [00:45:53] S0: Okay. The theme I'm really getting from this conversation... I mean, obviously, like, the automation and AI stuff is really exciting, but the other theme I'm pulling out is heavy partnership relationships where a lot of things that a lot of property managers are doing in house, you are relying on third party vendors, trusted partner vendors, like your eviction group, like this turn, contractor, the tenant screening, like, you're you're like, great. You're good at this. I'm gonna deliver the whole thing. In fact, can you also do this? Can you do this? Can you do this, please? Mhmm. And you're happy to pay for it and just get it out of the theoretical four walls that don't actually exist of your business and onto somebody else's area of responsibility. [00:46:42] S1: Yeah. You're exactly right. Even, like, the application screening process, the level of detail that the company I use to follow-up with applications is much more detailed than I would do it on my own. Yeah. So to pay someone to do it, I either paying myself and utilizing my time, which I find to be worth more per hour than what I'm paying them.
00:46:42 · Matt Luke, Peter Lohmann
[00:46:42] S1: Yeah. You're exactly right. Even, like, the application screening process, the level of detail that the company I use to follow-up with applications is much more detailed than I would do it on my own. Yeah. So to pay someone to do it, I either paying myself and utilizing my time, which I find to be worth more per hour than what I'm paying them. [00:47:04] S0: Yeah. Yeah. I think that mindset you just articulated, which is, like, you place a high value on your own time. You place... Like, I'm not gonna ask you to give a number, but my guess is you have an hourly rate in your mind of what your time's worth. 200. Okay. I would argue it's actually much higher than that, like, of zero. And anything that you can accomplish for a lower hourly rate than that, you do it. So, like, for example, tenant screening, you probably estimate it would take you an hour or two to screen a tenant Mhmm. Fully, you know, in a in a detailed way, including time to, you know, do landlord verification and all that stuff. And you're like, well, hey. If this company can do it for $75, that's way cheaper than my time if I were to do it, so I'm gonna do it.
00:47:04 · Peter Lohmann, Matt Luke
[00:47:04] S0: Yeah. Yeah. I think that mindset you just articulated, which is, like, you place a high value on your own time. You place... Like, I'm not gonna ask you to give a number, but my guess is you have an hourly rate in your mind of what your time's worth. 200. Okay. I would argue it's actually much higher than that, like, of zero. And anything that you can accomplish for a lower hourly rate than that, you do it. So, like, for example, tenant screening, you probably estimate it would take you an hour or two to screen a tenant Mhmm. Fully, you know, in a in a detailed way, including time to, you know, do landlord verification and all that stuff. And you're like, well, hey. If this company can do it for $75, that's way cheaper than my time if I were to do it, so I'm gonna do it. [00:47:50] S1: Mhmm. You're exactly right. And the first stage of that when I was growing was the maintenance side. When I was first building real estate, my wife and I did a lot of the cleaning and painting ourselves and it's a big step to say, You know what? We're ready to let somebody else do that. Yeah. And that was probably the first time where we made a real change in the business that we have to spend our time building the business and not working in it.
00:48:18 · Peter Lohmann
[00:48:18] S0: Yeah. That mindset shift of my time is worth more than $20 an hour. My time is worth more than $40 an hour. My time is worth more than a $100 an hour is, in my experience, not easy and not a natural thing that just happens automatically. It's something you have to either work at it or have a mentor or have somebody who's kinda pushing you. Like, for me, that was my business partner. My business partner, for whatever reason, was born with a high intrinsic understanding of his hourly rate. And he's like, you and I, Peter, are... We have we have engineering degrees. We're smart. We need to not be doing this. We need to not be doing this. We need to charge this for that. And I was always like, woah. Like, this... I don't know. I mean, I I was more conservative than him, but I really got from him this mindset of my time is worth a lot. And if something's a lower hourly rate than my time, then I'm gonna have this other person do it Mhmm. Or this other company or whatever. So I think it's great that you brought that, and it's clear. I mean, this is what happens when you fully internalize that mindset. You end up figuring out a way to build a big, relatively large company, not relatively large, but, like, more than just a 100 doors with no employees, with automations, and with all these other things, and you end up with a super high profit margin.