Make Things Simple
Standardized building supplies. There’s a reason that every Rona, Lowe’s, and Home Depot looks the same. They’re all built with the same materials using the same designs. In real estate investing, you should do the same. It’s not all about the looks either. There are many benefits that come from using standardized designs and materials including faster turnaround time, cost savings, and higher tenant satisfaction.
By using standardized designs and materials, you will realize faster turnaround times when renovating a rental property. You have to complete the project anyways, so why not do it once, then do the same thing again and again and again. You will realize economies of scale much faster through repetition. This is true whether you are completing the work yourself, but it really starts to make a difference when you are using contractors. The simpler you can make it for your contractors, the easier it will be for them to say yes every time and the less room there will be for errors from communication, ignorance, or incompetence. All of this will save you money, headaches, and time.
The cost savings from standardizing your designs and materials will be immediate. You will find these savings in a few different forms. First and foremost will be in bulk discounts. Take a look at everything you’re buying regularly that you can use across your units and ask suppliers for discounts on bulk. One of the biggest savings we’ve found is on flooring. We use the exact same vinyl flooring in every unit, so we buy it by the skid not the box. This has gotten us as much as 20% off the cost. You will also have the added benefit of always having extra inventory on hand when a tenant inevitably damages your floors. This makes purchasing, replacing, and maintenance extremely simple and a lot cheaper. The same can be said about your paint, tile, and appliances. You will also save a ton of time and therefore money on management. Getting your property managers and contractors on the same page for replacements and renovations will be key in reducing your costs.
Standardizing your designs and building materials will increase your tenant satisfaction by decreasing the turnaround time for you or your property manager to repair damage or replace broken items. If you always use the same flooring, paint, appliances, toilets, door locks, etc. you are able to quickly respond to something simple like a leaking toilet or paint touch-ups, or to get an entire new unit rent ready.
While standardizing your designs and building materials will undoubtedly save you time and money, there is a drawback that we should mention. It is possible to pick the wrong materials to work with, then end up having a lot of that material throughout your portfolio. We’ve seen this with keyless entry door locks where over 30 of the same lock began failing across a portfolio. To avoid these issues, you will want to do your best to do your research ahead of time. Ask your peers, carefully read product reviews, and consider their warranties. Another thing to consider is that you typically get what you pay for, so make it count. Doing something right once is a lot more valuable than having to return and do it again.