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Property Management Mastermind Show

#172 Taking Control of Churn in Property Management

Jul 18, 2023 by Brad Larsen

Struggling with churn in your property management business? In this episode, we'll show you how to take control of churn in your property management business. Learn practical strategies and tips on how to identify problems, develop solutions, and successfully reduce churn rates. Get ahead of the competition and start controlling churn now!

Connect with Brad's team at www.rentwerx.com!

Brad Larsen: Hey, everybody. On today's episode, we're going to spend quite a bit of time talking about our quarterly meeting and some of the highlights that came out of it to include redefining churn in our industry. Hey, everyone wanted to introduce the RentWerx summit going on December 7th and eighth, 2023, in San Antonio, Texas. We're only allowing six attendees to this event, two full days of all the inside outside training that RentWerx puts on with biz dev mastermind, our CPA, our maintenance team, our operations, our leasing, all of that two full days in San Antonio. Visit our mastermind.com.

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Brad Larsen: Hey, everybody, and welcome to another edition of the Property Management Mastermind podcast. I'm your host, Brad Larson. Now, today we're going to be doing a monologue, so it's a real boring episode. Ha, ha. You're going to listen to me talk for a few minutes and there's a lot of things fresh in my mind I want to put out there. And I think it's good content for the folks that are listening because it's very poignant and specific to what we do as property managers in running a large organization or even a medium sized organization. And the folks that may not have that yet, it's something to strive towards. Just make sure your organization is running well. And so we just had our quarterly meeting. There were a couple of things that came out of it. Now we to give you some background, we follow EOS the model, the EOS model you can get from traction. We had a full time implementer come in and put this into the business. His name was Phil Mazer. There's a couple others out there like Deb Newell that I would recommend. They're all good, right? They're all good. And they implement the model and what that is, it's a cadence or a series of meetings. And the meetings are everything from weekly to monthly to quarterly to annual. And so at RentWerx, we do an annual meeting off site. And that's one of the key points is we do it off site, so we do it away from the office.

Brad Larsen: And in fact, we're moving into a new office here this month and we're considering doing the quarterly meeting at our new office for October time frame. And I really started to think about that. I'm like, No, because it only takes one tenant or one Fedex person to ruin that whole experience. So we really make it a point to go off site. And I honed in on the example, okay, somebody from UPS walks in and they demand a signature from somebody. We have to stop the meeting. They got to walk out into the reception area. They got to sign for a package or you get one particular owner or tenant or vendor that walks in and they got to have a problem solved right then. And there. And people walk in and say, you know, can you talk to this tenant for 30s and or give them a key to something and something. It just disturbs the flow of the meeting. So this is why we don't do it on site at our conference room. We make it a particular portion of effort to go off site and we go to a radius office. We rent their big conference room. Again, it's off site. It's easy to get to. It's ten minutes from the office and we've been doing it there for a couple of years. They have big giant whiteboards and so we write everything up on the boards and it really gets productive now. And I'm talking through the quarterly meeting stuff is we don't go a lot of times through all the touchy feely stuff.

Brad Larsen: And I know some people might say, Oh, that's, that's, that's not the, you know, the proper method. So the touchy feely stuff is to like really spend a lot of time talking about your core values or your core focus. Okay, We've already defined those from implementing the EOS model. And so core values are customer first accountable team player, continuous improvement and get shit done. Haha, that's that's the one I love to add in there. Now we don't spend a lot of time redefining those core values and the outline of a quarterly meeting they might have. You talk about this all morning, but let's redefine your core values, let's redefine your core focus. You know, part of our core focus, we actually did redefine it a little bit. So at current, as I'm looking at it in paper in front of me, it says provide exceptional service. And so what we did is we added to that because I do have a couple standing rules, standing orders that RentWerx. And the first one is get the business. Second one is keep the business. Third one is provide exceptional service. Those are our three generic standing orders, like the standing ideas of what we what we hone in on and we define it basically. We combine all that and we combine it into get the business, keep the business and provide exceptional service. So that's now our core focus purpose as defined in the US Vision Traction Organizer Right.

Brad Larsen: I'm giving you some good examples there because going through the drill of getting to this point where you have that all on paper is excellent. You can quiz your staff members, you can always reference it back in your mind, okay, what are our core values? What's our core focus? Because there's questions that pop up. We talked about that just in context at the meeting. I can't exactly remember the example, but we were talking about a particular client wanting to Oh, I know exactly what I saw. I just remembered, gang, we're talking about a client wants to add in another property into our our business and you know, we end up making it so difficult for them. You know, they might have one property under management with us. You would think it would just be, Hey, I'm bringing this other property to you, let's go. But in the way we're doing things and this is probably the way things are being done for most property management businesses is you have them sign a complete new property management agreement. And we started thinking about that like that's just a barrier of hassle because we don't need their name, we don't need their taxpayer identification number, we don't need their home address. Again, all we really need is a one page simple little I call it an addendum. Again, it's not an amendment. An amendment changes the original contract. An addendum adds to it. So we need to build and we're going to build.

Brad Larsen: This is one of my to do's. We're going to build a simple addendum for somebody to just add in another property. In addition to they have to fill in the stuff that's with it. Okay, so the addendum is a one pager, but then we have the onboarding sheet like, okay, how many remotes do you have? How many air conditioning units does it have? Does it have a water heater that runs off of gas or electric? You understand. So we have to understand that for each particular property. But we can skip through the boring stuff of like, give me your name, give me your phone number, give me your address, give me your email. You understand? And just have them do a one page addendum. And I'm going to make a point with this that all circles back to get the business one we got the business very quickly with with potential addendum that we're going to build to it helps us keep the business because we're keeping the customer happy. We're not making them go through 19 pages of a property management agreement and then three, it provides exceptional service by making it easy to get one and two accomplished. So I use that in like an example that we can all understand. And that's something that came out of that meeting because our business development guy is like, Hey, we had somebody sign up and they want to just add one more property six months later, three months later, and we're like, Well, just have them sign a new property management agreement.

Brad Larsen: And we all started looking at about that. It's like, that's kind of intrusive. I mean, we're really just making it a pain in their, you know, what to to just add one property. Let's streamline this. And so I hone in on that just as a good example of our core focus tying into an actual event that worked that came out of this meeting. This is this particular episode is a synopsis of that quarterly meeting to give everybody some insight on what some of the things that we talk about that might trigger something in your particular business. And so we of course, we have our our ten year target in the EOS model, which is a ten year target. I'm more of a five year target and then we have a three year picture. And so I'm not going to bore you with some of the details that we go through it. But I'm telling you the outline of what we look at and the marketing strategy that goes into it. We have three uniques. We have multiple transparent pricing options, two flat rate fees, I mean, all that good stuff that comes out of the marketing strategy that is target market, the list, the three uniques of your business and you have a proven process. All that's part of the marketing strategy which is under the vision umbrella. And so I wanted to talk through that because in this particular quarterly meeting we skipped through it, right? We already had it done.

Brad Larsen: We already did this months and months ago, years ago. And so now we get into the fun stuff, which are the the reviewing of what we've done the last quarter and going forward and what we want to do for the next quarter, which is the intent of the quarterly meeting. And of course we had our rocks. A rocks are the big goals for the quarterly meeting and I'll give you a couple of them from what we came up with. One was we wanted to we had to find a new eviction attorney. We had to establish a relationship and document that process. And that was. Part of Staci's goal. She's our special projects queen. She's fantastic. And so she had two research attorneys. She had to interview them. We had to dovetail them into our system. We had to figure them, you know, figure out what they wanted to do. And then, of course, their charges and all that stuff. It was quite the effort and that was one of her goals that she got accomplished this particular quarter. And then we track all those rocks and then we have a percentage of completion of those particular rocks, those goals. So let's say you had ten rocks and you got eight of them done. There you go. You have an 80% completion rate. So it gives you an actual you're tracking metrics for the metrics of the meeting if you want to look at it like that.

Brad Larsen: So another one of the goals we had was the 401 K and payroll transition to ADP. Okay? We transitioned from one payroll provider that was local. We went to a large payroll provider, ADP. That was a lot of work and that was all on Amy our lead, our basically our vice president, our lead accounting coordinator. And she took that. She took all the 401. K and she got it moved over all the employees that were getting into that. We transitioned to our payroll with ADP and that was on the advice of our CPA. Again, all these acronyms flying all over the place and our CPA does our quarterly meetings. So it's fantastic. We have Shannon Badger. She's going to be part of the RentWerx summit that's going to be happening in December. She's there doing our quarterly meeting, so she is now done four or 5 or 6 of these for us and she is fully ingrained into what we do. I mean, I don't think there's anybody else outside of our industry that understands as well what we do as she does. So it's really actually kind of neat. She she gets all the lingo now. She understands the acronyms. She understands the questions to ask, and she allows us to streamline this into a very productive meeting where we start throwing issues up on the on the whiteboard. And the issues are stuff that we talked through at length because in attendance we have our lead property manager, we have our business development manager, we have our head maintenance guy myself, we have our CEO, we have our accounting people.

Brad Larsen: And there's there was 8 or 10 people in there. I'd have to go around the room and count, I think ten. And a lot of those issues that come out of that are stuff that we can talk about at length. And there's some pretty I guess I'd call it contentious moments because of course you have ops mad at maintenance, maintenance, mad at ops. And the two leads in that particular realm did a very good job in keeping their emotions in check. And they did a really cool thing of just talking through the issues and trying to work through them together. And a good facilitator will squash anything that's going to be a negative type of a scenario where you don't want to gang up type deal, Well, you did this and you did that and you got five other people and you did this and you did that. And that's how people, you know, get really alienated and they run out crying. And that's not something that we wanted in this particular meeting. But you start talking through the issues as a group. Some really good things come out of that and that leads into to Dos and it funnels down into rocks. And that's part of the one of the things I want to talk about is you might have 25 issues. You talk through them and that's going to produce ten to dos and then five rocks.

Brad Larsen: Rocks are quarterly goals and to dos are somewhat fairly they're a lot simpler than a rock. I mean, the to dos are just, I don't know, kind of just check the box stuff that you got to get done to really accomplish the rocks they might lead into them. So one of the other projects we're working on is solidifying the RentWerx Summit. Dates are 7th - 8th December. We're going to solidify a detailed itinerary providing to dos, providing rocks for that and making sure that's a very good experience for the folks that want to jump in and come visit our new office in December and see how this process flows. See how our business development works. I mean, we had a fantastic month. And so part of the reason, part of the things that we do in a quarterly meeting is we go through our accountability chart. We talk through our organizational methods. We have 38 employees, and so we have pods, we have Team Rent, Team Werx and Team Austin. And those teams have three, four different a different remote team members underneath them. And so one of our challenges that we actually work through this meeting is when do we hire another local property manager in San Antonio? Bring in 2 or 3 remote team members underneath them and create another pod. When do we need to do that? What actually came out of that meeting is we don't need to do that.

Brad Larsen: We just need to add one more remote team member that can assist with maintenance and make readies into each particular pod. And so as a business owner, I'm like, That's fantastic because I'm thinking, Oh my God, we're going to have another, you know, 60 to $80,000 salary for a local property manager. And we've had very unlucky luck with local property managers. We're now in our third one in Austin and we have high hopes for that person. But we've had to just I mean, that's the nature of the beast with the with local employees, American based employees. And it's not a negative thing. It's not a you know, I don't want to disparage it just how it is. And so what we're going to end up do end up doing is adding one more remote team member into each pod at a fraction of the expense, like one fifth, one sixth of the expense of a of another local property manager, and then start to build out more processes for them. The end of the day, we're going back to our Vision traction organizer, core focus provide exceptional service. And that's how we felt we could do that better. Is adding one more point of contact that can do things, that can get things done in maintenance, that can answer phone calls. That really is one of those people that can ensure that we're doing the best we can to solve problems. So that came out of the accountability chart review.

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Brad Larsen: Each week we have a level ten meeting and some of the things that we track weekly in the level ten are number of units managed. Now these are actual units. Okay. These these are not HOA doors that we track that we want to puff up our unit count. We track this on a weekly basis to an actual real number. And so you're going to find if you ever bump into me in a conference and you say, how many units are you managing? I will give you an exact number based on the last week's meeting because I track these numbers as well. And it's not a generic Oh, we manage about 500 doors or 200 doors or something. I like to give it to you to an exact number. That's just me, because I see a lot of property managers out there. They fluff their their feathers and they want to say how big they are. But rounding up times two. And I just I hate that. So we have number of units weekly that we've added. We have number of units year to date that we've added this year. In July 6th, we've added 192 units. Not bad. We're pretty close to our goal to add 400 units this year. Then you take away the churn. Now I'm going to get to the churn gang. Okay, Just bear with me. I'm going to get to the churn because I know we're modeling this episode, calling it redefining churn and management.

Brad Larsen: That was the the catch phrase to get everybody to listen to this. We're getting there. I have a very big point to make on that. We track our vacancy rate and one of the things that we had as a vacancy rate goal was less than 4.5%. And in the meeting, I was kind of making the point of I don't really care what our vacancy rate is necessarily because we can't really control it. You understand that. So we can't control the market. We cannot control how owners price their homes and we can't control that. June, July, you know, May, June, July and August are just super, super busy. And of course, you're going to have a longer vacancy rate when there's more homes in the market and market wide that's happening. So we've had a little bit of a trend up in the vacancy rate, but it's only reflective of the busy season. So I'm not worried about it and I just want to bring it up. Same with the average days on market. Our average days on market has been very consistent in that in that 29, 30, 31 range across the board the last few weeks. And I was making the point in the meeting about the average days on market is, again, if we're doing the right things, that's going to take care of itself. And it's also indicative of the fees. And this is one thing that came out of an episode where I did a podcast previous and somebody asked me the question, Well, what about all the fees that you might charge the owners, you might charge the tenants, you might charge whomever and homed in on the fact of, okay, let's look at the days on market.

Brad Larsen: If our days on market are pretty consistent with the rest of the market, then we're probably doing an okay job and the market is telling you that what you're doing is feasible and acceptable. Now we also made the point that there are some cheaters in our market. I can tell you that for sure. They cheat the MLS, they do all kinds of different things to avoid the days on market because you can never convince me in a thousand years that they have half the days of market that we do okay because we are doing exceptionally well in our marketing efforts with pictures and video and time frame and pricing. And when you start seeing a company local, because I look at all the numbers gang, I dig up the MLS numbers, I do an annual analysis of what some of our biggest competitors are doing locally here and in Austin. And you look at them and you're like, okay, we're at 29 days, average for average days on market, and then some company is at 14 or 15 or 16. I don't believe it. I don't buy it. They're cherry picking. They're only putting the home on the market after they have it rented, they're canceling and then re listing the home.

Brad Larsen: They're doing all kinds of cheating methods. And so I've caught people several times before. They've been reported through the San Antonio Board of Realtors. And I've been that Karen, and I'm fully going to own it. So that's a long discussion. On the average days on market number of new leads, we're doing well per week. You know, we got 44, 32, 36, 31 leads per week. Those are for new management cancellations. We, you know, three, one, four, eight five, and we get our cancellations like everybody else. And that's going to lean into the churn. Of course, homes closed. Wow. That is down. So we've only closed 13 homes and we closed last year at this time, probably triple that. So that is an indication of the slowing sales market. We have a goal this year for 70 homes sold inside of our inventory and that could be the outside buyers or that could be the internal investors. It's just selling homes market has super, super slowed down from that stat and interest rates you got people not wanting to sell. Covid is pretty much over all the above going into it. Now, one new stat that we track is company strength, and at a certain point we started to get so big that I needed a snapshot to understand where we are on our hiring and firing and our filling of our positions with 36, 37, 38 positions, it's good to know our company strength.

Brad Larsen: And this this came straight out of my military days where if you had an army unit of any sort and your your standard full strength is 100 soldiers in an infantry company and I'm using round numbers and you have 90 soldiers assigned to you or only 90 available, Well, you're at a 90% strength. And so I use that concept in our business to get a one line understanding of where we are in our hiring and firing and staffing, and that's our strength. And so this last one, we were at 97% pretty good. So I think we got to hire one more and then I think we're good to go with our strength as far as that. And then of course, we have a level ten meeting score. So at the end of these level ten weekly meetings, they give a score like what do you think about it? A lot of nines and tens. So, you know, people might not have the energy that day or a couple of people are missing. And so that's how some of those things end up being a little bit longer or less than what they could or should be. And so what I do want to do now is go through some of the to do's and or rocks that might have come out with it. Here's a good one. So our owner lock boxes, we were having problems tracking lock boxes.

Brad Larsen: Okay. It's not this is one of the issues that came out of it. And I'm hoping all the listeners can understand that. We have lots of lock boxes flying around everywhere we use the mfs lock box, they run around 22 or 23 bucks a lock box. They're a stupid old combo lock box, which I'm a big, big fan of for a lot of reasons. I could talk your ear off about that particular subject. Not a big fan of the electronic lock boxes. I don't trust the electronic doorknobs. The good old fashioned on the door lock box is a good way to go. Our discussion point was maybe we want to look at installing a permanent lock box on every single home, the kind you drill into the siding. It could be the front door, it could be the side frame, it could be on the back side of the home. It could be on a fence anywhere where you could drill in an actual permanent lock box. We are seriously considering doing. And one of the things that came out with it is let's give the owners a choice in the property management agreement. They can pick a. permanent lock box for free or b. removable lock box for a fee of X, and that fee is really covering the trips that it takes us to go to the home, put a lock box on the property, go back to the home when the tenant moves in because we do a lock box, move in for free.

Brad Larsen: You know, that's benefiting everybody. For the tenant, we have to go back to the home to remove the lock box off the door. Otherwise the lock boxes disappear and we end up spending, you know, we end up buying 100 lock boxes a year at a couple grand cost. Right? That's probably what we spend a year in lock boxes between 1000 and 2000 bucks. Now, same thing we're talking about with the signs. As you guys know, I don't do anything half. You know what? Our signs run about 40 to 50 bucks the for rent good quality metal yard signs. There are 40 to 50 bucks a shot. We get them from Oakley signs out of Florida. We can't find anybody cheaper local to do it. That's been a fantastic resource for us. Oakley signs out of Florida. I get nothing for saying that. They're not even a sponsor. They don't even know who my who we are. But we probably order 50 signs a year from them. If again, if each sign is 50 bucks, you got 50 signs a year. That's 2500 a year. You know, it's just it just adds up. So what's frustrating is the signs are coming in. They're coming out with no accountability. So one of our projects that we're going to do, and that's part of the rocks that we have on our list is to figure out an accountability method.

Brad Larsen: Now this is inventory management. One on one. You can go into the Amazon or the Google and look into this subject and you're going to find, you know, the scanners that are handheld pistol scanner, things that you can assign a barcode to every single sign that you have. And I think that's what we're going to do. I think we're going to have to get really, really good at that to reduce that sign churn, right. Of signs going in, signs going out. Nobody knows how many we have. Nobody knows where they are. They end up in somebody's garage and they end up throwing, getting thrown away. We want to reduce that and make our field techs. Scan in every single sign. And then when they put it into a new yard, they scan that particular thing out and add an address to it. Now, that's that's really boiling it down to the basics. And so the point of that is that's one of our rocks that came out of that meeting in long discussion format. I mean, we spent ten, 15 minutes discussing it. Now. It's something that I think we want to do because, again, we're just eating money every year, throwing money away and missing signs. And so that's a big part of it. We also want to talk about our pest control guidelines because we do our own pest control measures. And what we've done in the past is we add a free pest control to our resident benefits package and we also add it into our owner's benefits package that we offer free pest control.

Brad Larsen: But we need to make sure we limit that. And that was one of the things that came out of that is crazy story is okay, we offer the free pest control tenant ordered it as part of the resident benefits package. We go out, we execute it, the service and the pest vendor Pied Piper discovered that there's German cockroaches. I don't know. Germany brought cockroaches, but there's German cockroaches at at this particular home. All right. Who pays for it? Question mark. Long pause for effect. Who's paying for that service that's going to remedy those German cockroaches? All right. Well, we spent a lot of time talking about that. Well, we if it's within the first week, it's going to be the owner, right? That's only fair. That's an owner issue If they've been there for six months or a year and all this other well, it's on them because they keep a dirty home or just got unlucky with that particular home and having an infestation, it doesn't mean anything against them. It's just, you know, bad luck with pests sometimes. So we need to clearly define that and we're going to go back into our property management agreement and into our resident benefits package and clearly define what we're going to be offering in our pest inspection services.

Brad Larsen: So that's one of the things that came out of our to do list and rocks. Now I'm getting to the meat of this finally as we close out, because this is a long discussion on industry churn. For quite a while. We've had vendors in this space who don't manage property, but they know everything about everything. Just ask them. They'll tell you they all of a sudden know what churn is and what you have as a property manager have been doing wrong. Well, clearly you must suck as a property manager if you have churn, right? That's their intent. So you'll listen to them and figure out what you can do by adding their software or adding their methods. And I don't believe in that. And you guys have heard me talk about this. Churn is just a natural side effect for our industry, and it's reflective of the sales market. It's reflective of the times, it's reflective of people in general. You can't provide a perfect service. You're going to irritate upset owners and they're going to fire you. It just is something you cannot avoid. It's also to the point of you're going to run into owners who won't do the right thing. They want to discriminate. They won't make repairs. They don't have any money. All of that will cause churn because either one, you're going to get fired or two, are you going to fire people Now, We were flipping out a few years ago, and I want to give you a long version of this, because all of a sudden we're looking at our churn rate and we were at 28, 29% and we're like, WTF? What is going on with our churn rate? And we did a couple of different things to really start to reduce that.

Brad Larsen: And the biggest one was trying to capture those sales and we started that with the whole sales team. You guys have heard me talk about this. We implemented some key components with consultants and they came in and built our sales team and we have a fantastic sales team. And what they're doing is they're very proactive and reaching out to all of the owners, reminding them gently that we do sales, quarterly, monthly, whatever. We offer, a free CMAs, you know, unsolicited CMAs. We offer them, we push those out to the owners. And essentially we're trying to reduce churn that way. And I've seen that go down significantly. In addition, what came out of last quarterly meeting into this quarterly meeting was let's take a look at what our churn is and why it's at the level it is. Let's define the moment that churn starts. And what we found out was we would get somebody signed up on a property management agreement, and if they were no longer there, that was a churn tick mark Okay. And then we defined it good, bad and neutral, right? Good churn, bad churn, neutral, neutral churn.

Brad Larsen: We actually went through the drill of putting that into words. And without trying to really get into the semantics of that in the weeds. Good churn is, you know, you sell their home. Bad churn is they fire you. Neutral churn is they move back in. Okay. I mean, we can go on and on and every single scenario, but you need to classify it however you want to classify it because there is no necessarily right or wrong in that particular way. Classify good, neutral, bad. So we started asking the questions. Okay, what about the folks that signed up? And never brought us their home. We never managed their home as far as having a tenant. We didn't manage any money. There was no cancellation fee paid. And I want to understand how many of those in the last 12 months fall into that category, because we were sitting probably 23, 25% of our churn rate with an annual goal of 15% churn rate. Okay. So we started looking at that. We had a bunch of scenarios where people would sign up, sign a property management agreement and then ghost us. But yet we were counting them as churn. I said, No, no, no, no, that's not right. If we didn't manage their property, we didn't have a tenant in place, we didn't have a lease agreement in place. They're not considered churn. They were never technically our client. And so we started to do an audit and we threw out 46 again, 46 units of churn from last 12 months.

Brad Larsen: That didn't count. And so our churn rate went down from 23 to 24%, whatever it is, to like 14% churn. So all of a sudden, by clarifying the metrics of what that meant, we looked at ourselves again and said, wow, we're not doing as bad as we thought. We're not doing as bad as the industry gurus thought we were. And it really kind of made us think about, okay, we're doing okay because now we understand that when someone signs a property management agreement, but they refuse to make repairs and we just go our separate ways before we ever have a tenant, that's not really our fault. And we're not going to take a hit in the chin as a churn metric. And so we redefined it. We threw out 46 particular units that signed up and were just for whatever reason, they went away. Their cousin rented their home. They decided to sell it before we ever listed it for rent. You know, they ghosted us for whatever reason. They found another property manager that, you know, did it for cheaper or whatever. Those we decided to not count against us, and rightfully so. I firmly stand behind that. And all of a sudden our churn rate is looking good. And so I want you to understand, when you look at your churn, forget what the industry guru people say. Look at the people that were actually under management with a tenant, with a lease agreement, collecting management fees for longer than a month.

Brad Larsen: If you just listed their home for rent. And then they decided to rent their home to some person at church that they met yesterday. That's not your fault, okay? That's not on you guys necessarily. That's just people. And you just have to count it up as just part of doing business. Okay. The cost of doing business. So and having gone through this long monologue, I hope you guys got something out of it. That's kind of what we do in our quarterly meetings, some of the challenges that we've been facing, and then also that huge revelation of what churn should actually be defined as. And I think that's going to change how you look at it. I think that's going to make you realize, hey, maybe you're not doing so bad and maybe you've been calculating your churn, if at all. Maybe you've been calculating it wrong for this long, because we certainly have. And the end of the day, it was kind of silly that we were doing it like that because we're looking at ourselves like, God, what's wrong with us? Why? Why is our churn so high? Why did we have, you know, 30 units last month or 25 units leave last month? Well, when we broke it down, only ten decided to sell. You know, five decided to self manage.

Brad Larsen: We ended up firing five and then five ghosted us. Wait a minute. Five ghosted us. What do you mean? Yeah, we signed up this person and that person, the other person. And we've reached out five times and they just they won't respond. We actually got a hold of this person and they said they decided to to rent them home themselves. Right. Which means they found a tenant at the grocery store and they just bumped into them and said, hey, just lease my home and I'll fire my property manager. And we don't try to hold people to those contracts like that. That just creates bad blood. We say, All right, if that's something like that happens, we're not going to charge you a cancellation fee because we didn't put the home on the market. All good. No harm, no foul. Come back to us if you need further management. We love you. Goodbye. You know, that type of stuff. And that's how you end those relationships. Very well. So to wrap up this episode, I want to give you a long format of our synopsis of our quarterly meeting. Hopefully you got something out of that just because we want to talk about how we run those meetings, what comes out of them, some of the challenges that we see, and maybe you got a snippet out of there that you can apply to your business. So thanks for listening. Look forward to having you on the next episode.

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About The Host

The Host of this Podcast is Brad Larsen from San Antonio, Texas. Brad is the founder and owner of RentWerx, one of the fastest growing residential Property Management companies in Texas that currently manages over 700 single family homes.