- Tom Brickman is a 39-year-old real estate investor who purchased his first property 18 years ago.
- Some of the mistakes he made along the way include overusing himself and skipping tests.
- He adds that it’s important not to take tenant issues personally, and suggests never taking personal checks.
39-year-old Tom Brickman was just 21 when he bought his first property. It was a $90,000 apartment complex and he lived in an apartment downstairs. Since then, He has built a portfolio of 21 rental properties in both Texas and Ohio.
“I noticed something that other investors were ignoring,” Brickman told Insider, adding that he greatly prefers buying a fixer upper than getting a turnkey property.
Brickman’s portfolio is so large that he no longer has to work a 9-to-5 job and can devote all of his time and energy to his real estate portfolio and his side hustle selling things on eBay.
“I was able to reprioritize things that were important,” he said, adding that he quit the job because he liked the flexibility of being able to create his own schedule. , Brickman makes more than $7,400 a month from his property alone.
But it’s been a slow process. Brickman stresses that it took him 18 years to get to where he is today, and made a few mistakes along the way.
He shared with Insider four things he wished he’d known when he started investing in real estate, and what he learned from those mistakes.
1. Don’t take tenant issues personally
As Brickman said, what really matters to being a successful landlord is building a positive yet professional relationship with your tenants.
“Your tenant is not your friend,” said Brickman. “This should be run like a business, not a personal one.”
He then said that when he purchased the first property, there was a problem with the tenants on the second floor. Because she smoked so much marijuana in her apartment, Brickman’s clothes always smelled like marijuana.
“I didn’t mind if she sat outside to smoke, but when my clothes started to smell, I got pissed off,” Brickman said. Once you let it slide, people try to do it over and over again and the problem starts to become very problematic.”
Brickman said it took him years to learn this lesson, but now that he’s set boundaries and kept things professional, he’s on better terms with his current tenants.
“I have a favorite tenant,” Brickman said. “I have one cash tenant who gives me vegetables from her garden every time I see her when it’s in season.”
2. We do not accept personal checks
Another problem Brickman encountered while working with tenants was nonpayment of checks and overdraft charges when collecting rent.
“I once had a tenant give me three bounced checks,” says Brickman. “After her first conversation, she should have told her she needed either cash or a money order.”
He added that not only did he not get the rent he expected from the property, but the bank charged him a $30 fee each time he tried to cash her bounced checks. Currently, he only accepts certain types of payments each month.
Platforms like Zelle, CashApp, and Venmo didn’t exist when Brickman first launched, but they’re very helpful when it comes to collecting rent, he said.
“I have two cash tenants,” says Brickman. “Many of them are digitized through Zelle and CashApp, one he from Google Pay and some from Venmo.”
Beyond Brickman’s suggestions, there are other tools that individual landlords can use to easily collect rent online.popular ones turbo tenantamong other things, provides landlords with other resources for leasing and tenant screening.
3. Don’t overuse yourself
Brickman said the third house he bought was the one he had lost the most in real estate so far. It was in Cleveland, Ohio, and he said it cost $85,000.
“That was in 2005 and in 2007 it was halved in value. half‘ said Brickman, adding that when he sold the property about 10 years later, it was just $63,000.
However, he added that he was actually happy with the sale because he felt like he was getting a fortune out of his hair.
“I’ve had to evict there, but I’ve only done so three times in the last 18 years,” Brickman said. “It was a dud from start to finish. I don’t regret selling it.”
He said real estate “tired him” over a decade and hated talking about real estate with accountants.
When Brickman bought the property in 2005, he didn’t have to pay anything for it, adding in hindsight “there was no business buying it in the first place.”
“We messed up the payments so we wouldn’t have to foreclose,” Brickman said. “I didn’t want to ruin my credit, so I kept paying until I finally got it off the books.”
Recently, Brickman said he only has two mortgages on all 21 of his properties.
“That’s my comfort level,” he said. “In the early days of COVID, I had two mortgages and I remember thinking, ‘If I only collect rent from three people, I’ll be fine.’ I’ve always grown slower than others. It’s been like 300 doors, but that’s my comfort level in building my real estate portfolio.”
Brickman said reading articles about other real estate investors using such leverage can be intimidating, and reading it can be indirectly disturbing. But he also added that there are other investors in the space who have higher net worths and can afford to do it than him.
He added that as his portfolio grows, more and more investors want to partner with him on specific properties.
“Two of my 21 doors are with partners, and those are the two most difficult doors for me,” Brickman said. increase.”
He said he wouldn’t necessarily dissuade him from signing a partner, but said he had added five properties to his portfolio in the last year alone, which he said was “very big for him”, and all five of those new properties were foreclosed on. was purchased with proceeds from the sale of another property.
4. Get a proper inspection before buying a property
Preventing a home from becoming completely unrepairable is especially important for an investor like Brickman. Investors like Brickman enjoy investing huge amounts of time and money in buying unwanted properties that require a lot of effort.
“Some homes end up costing more than it’s worth trying to put them back together,” says Brickman. “Foundation [repair] It’s huge, and the plumbing is huge. “
Regarding the foundation, Brickman said the type of foundation in the house is also very important.
“I love the pier and beam foundations that were so popular in the 1950s,” says Brickman. “I hate slab foundations because they are really hard to fix when they break. choose that, not a cracked slab foundation.”
Brickman said one thing he’s learned over the years is that it really matters to pay a few hundred dollars for a proper inspection before buying a property, and that it’s the first property he’s purchased. He said he regretted not doing this in the
In addition to Brickman’s recommendations, it’s also important to check whether the inspector is working with the real estate agent. To avoid conflicts of interest, it’s usually a good idea to find someone who works separate from the agent trying to sell you the house.
“I put lipstick on a pig, and I immediately regretted it two months later,” Brickman said. “There was a puddle in the basement.”
He added that he was eventually able to fix these issues and is fine now, but that he will never make the mistake of not inspecting the property again.