During today’s HyperFast Wealth segment, host Dan Lesniak speaks with Laurence Jankelow, Co-founder of Avail. Hear Laurence talk about his experience as a DIY landlord, and how his software, Avail, helps address the problems he encountered when becoming a landlord. Learn his tips and tricks for getting started as a landlord and how to market your business.
Episode Highlights:
- Laurence was a finance major in college, worked in consulting and data analytics, then joined Goldman Sachs.
- He was able to buy a three-unit apartment building off-market from a friend.
- In discovering some problems as a new landlord, Laurence and a friend decided to build software to help solve those management problems.
- For this initial deal on the three-unit building, Laurence got it at a 10 gross rent multiplier, which was a great deal.
- Gross rent was about $6,200 per month.
- The challenges Laurence faced and wanted to solve included automating reposting rental listings, collecting rent, and more.
- The software is really designed for small, do-it-yourself landlords with fewer than 9 units, though they have some users with 200-300 units.
- The software allows them to post listings, screen tenants, generate lease agreements, and tenants can pay their rent and request maintenance through the portal as well.
- These smaller landlords are all but ignored in the market, with property management software mostly geared towards folks with huge portfolios.
- Software geared towards people with thousands of units is too cost prohibitive for smaller landlords.
- Right now, the software is free for all landlords; they only charge applicants for tenant screening reports and there is a small convenience fee for online rent payments.
- Landlords can also pay $5/month for premium features including increased customization and faster rent payments.
- They currently have 200,000 landlords and just over 400,000 tenants.
- Laurence estimates that 90% of their users have only 1 unit.
- They offer live chat and phone support 7 days a week.
- Landlords with only 1 unit don’t generally think of themselves as landlords, so it’s difficult to market to them.
- To reach these people, Laurence and the company publish a lot of white papers and guides in response to common search terms they see, like “What do I do if my tenant’s rent is late?”
- Avail plugs in pretty seamlessly with listing websites like Zillow.
- They’re looking to add more financial reporting features, and increase features around maintenance.
- Another opportunity Laurence sees is in matchmaking people who want to get out of being a landlord with people who want to grow their portfolios.
- Personally, Laurence has increased his portfolio to two 3-unit buildings in Chicago.
- Laurence’s biggest piece of advice to a new real estate investor is to treat it as a business.
- The biggest challenges Laurence faced as an investor were getting started because of all the unknowns, and the fact that his building required a lot of maintenance.
- Laurence puts money away for future repairs that he foresees, like roof replacement.
- To learn how to get into real estate investing and being a landlord, you have to learn by doing.
- For people looking to buy a property, Laurence recommends the forum Bigger Pockets, as well as finding a real estate agent that specializes in investment properties.
- It’s tough to know when you’re ready to switch from investing as a side hustle to making it a full time career, but look at the kind of lifestyle you want to live and what you can afford.
- When he’s not working on Avail, you can find Laurence playing with his two young daughters.
- Five years from now, Laurence hopes to continue improving the way landlords and tenants communicate.
3 Key Points:
- Small DIY landlords are almost entirely ignored in the market.
- Many DIY landlords don’t even think of themselves as landlords.
- The industry is lacking in educational resources for DIY landlords.
Tweetable Quotes:
- “It empowers a do-it-yourself landlord to keep doing it themselves and maybe not have to use a property manager.” –Laurence Jankelow
- “Our tenants are our customers, so we try to do things for them that make the place nicer, a better quality of life.” –Laurence Jankelow
- “Thinking about how you buy and sell homes are so different if you’re going to be living in it than if you’re going to be renting it out. People who buy to live in it are very emotional investors, and businesspeople should try to remove that emotion out of it.” –Laurence Jankelow
- “Try to accrue 1% of the value of the property each year.” –Laurence Jankelow
Resources Mentioned:
