Grief to Revenue Ratio –

What tips the scale on your Griefometer?

I heard this term for the first time last week and liked it enough to bring it to you.  If I’m a little obscure, the Grief to Revenue ratio refers to the concept of a person, product, deal, business or whatever that causes you more grief and aggravation than it is worth in revenue.  To you, anyway.

For example, the whole hassle of tenants and toilets is too much grief for some.  No big deal for others.

For me, grief to revenue ratio on rental properties is low enough that it’s worth it to me to have the income.  If those same units were a 12 hour drive, I would not feel the same way.  But take that same 12 hour drive, apply it to a commercial office building, and my ratio flips around again.  It’s worth it to me.

I’ve also spent enough years fine tuning my system so that I have reduced the grief and increased the revenue in rental properties.  Here are some suggestions:

Reducing Grief:

First, don’t do things that you hate.  If you hate to clean or paint, then don’t be the one who does the apartment turnover and cleanup in your buildings.

Second, improve your tenant screening system.  There are tips all over the web for how to find the best tenants.

Third, learn from your mistakes.   If you leap at an offer from an applicant to pay a years worth of rent in cash in advance, you might learn something from that when it all plays out.  You might learn that having a drug dealer tenant will clear out the rest of your apartments in a hurry.  So improve your Griefometer antenna by paying attention and thinking it through.  If it sounds to good to be true, it probably is.  Unfortunately.

Fourth, set up either a property manager or a maintenance man.  My personal preference is to manage the tenant showings and screenings myself, since nothing is more important than good tenants.  I pay for a regular part time maintenance guy, even if he sits on his tookus half the time.  It’s worth it to me, and the tenants are taken care of.  He also does trash removal, grass and snow, so most of the time he has something to do.  And I don’t get the calls.  🙂

Increasing Revenue:

Look for additional income streams.  For example, can you rent out garages separately for storage?  Add a coin-op washer/dryer?  Rent out washer/dryer hookups?  Add a bedroom to a unit for increased revenue?  Log the timber from a rural property?  You get the idea.

Consider investing in commercial properties.  While the risks are WAY higher, the revenue frequently is higher also.   Lower grief, too.  Ask me how I know.

So what tips your griefometer?

    • Is it sitting on the phone on a short sale for the 12th time waiting to speak to the loss mitigator?
    • Is it trying to deal with sellers in denial?
    • Is it dealing with contractors?
    • Having your end buyers get buyer’s remorse the day before closing?
I’d love to start a dialog on this.  Please post your comments and experiences.   Sound off, if you want.  I’ll bet it will start a whole new discussion.

Your partner in profitable investing,
Ann Bellamy
Buy Now, LLC

Changes at Boston Area Real Estate Investors Assn

Many of you know that I have been involved since Fall of 2009 in the health care of a family member in NY.  I continue to travel back and forth, and am fortunate that a laptop and cell phone are the mainstays of my lending business.  I can work almost anywhere, and frequently do.

Most of you also know that I co-founded BostonAREIA with my partner, Bernadette.  Due to time constraints, I sold my share of BostonAREIA to Bernadette in January 2010.  This change allowed me to focus my time on Buy Now Hard Money and my family and to assist in the continuing care of my family member.  I continue to help out at meetings on a volunteer or consulting basis at BostonAREIA whenever possible and will continue to do so going forward.  Bernadette and I started something wonderful together, and I will support her efforts on a volunteer basis as BostonAREIA evolves.

I will continue to speak at events around New England and at BostonAREIA when appropriate.  I am still a resource for questions and contacts.  I want to help you get your property purchased, and help you get it sold.  And I definitely want to help you get it funded.   None of that has changed.   BostonAREIA attendees and members are still welcome to contact me with questions, problems, suggestions and gripes about real estate investing and hard money.

Now quit reading newsletters and go find a deal!!!  And call me when you do!