How Smart Property Management Builds Long-Term Rental Wealth with Chase Coleman

Chase (00:00)
Yeah, I think we’re going to continue to add to our rental portfolio. I think that’s, that’s the key. I think people need to understand there’s a lot of ways that you make money on a rental property. It’s not just like the cashflow. right there.

the debt’s being serviced right by a renter. So they’re building in equity, you get appreciation. You also can have somewhat of what’s called an inflation hedge. That’s probably a different conversation. And then cost segregation is a huge deal. If people don’t know what that is, they need to go and look that up immediately.

Michelle Kesil (02:04)
Hey everybody, welcome to the Real Estate Pros podcast. I’m your host, Michelle Kesil, and today I’m joined by somebody I’m looking forward to chatting with, Chase Coleman, who is a owner of a property management company out in Houston, Texas, as well as a investor. So excited to have you here today, Chase.

Chase (02:24)
Thank you, Michelle. Thank you for having me.

Michelle Kesil (02:26)
Great, let’s dive in. First off, for those not familiar with you and your world, can you share what your main focus is these days?

Chase (02:35)
Yeah, so me and my wife own a single family property management company in Houston. So we handle the leasing and management for investors that really just kind of want to reduce stress and make more money with their long-term rentals. So yeah, so we have a team of six. We manage about 200 rentals.

in Houston and, yeah, that’s kind of our main focus these days. do do some, investing as well. As you mentioned, we’ve kind of held off on the flips now that the market has softened a little bit. So we were involved in a few flips per year. And then, we had some long-term holds we sold out a few years ago, when the market was good. And then now we’re reentering the market, on the buy and hold side. so yeah, so, operating the, management side and, know, looking for.

investment opportunities though.

Michelle Kesil (03:19)
Awesome, and everything is in the Houston market.

Chase (03:23)
Yeah, yeah, we’re local. and my wife were both born and raised here. So we know the market very well. She’s actually been in real estate since 2005. So over 20 years. It was kind of her first job out of college. She actually worked for a management company. So lots of experience there. And then I got licensed in 2012. I actually started in sales. I was a remax agent for a while. Had a little team and everything. But in 2017, we started the management company and just kind

made more sense for me to kind of join her and we have different skill sets so it works very well so yeah so been doing that yeah hopefully that answer your question

Michelle Kesil (04:03)
Awesome and what do you feel are some of the main keys that have allowed your business to grow and run successfully?

Chase (04:11)
Oh man, that’s a pretty loaded question. I think, I think first and foremost is the people, having good people, you know, is key. for us, we try to.

invest in their goals and dreams. And in turn, they, they help us in the business. when we do that, it’s kind of the reciprocity of things, I guess you could say, we don’t do it for, you know, to get something back for sure. we really try to invest in them and help them grow and take them along with us. and that’s for us as well. we’re always investing and growing in ourselves.

And I think that’s led to success. so yeah, just ha just having the right people and make sure everybody’s operating in their strengths. I think that’s where we’ve been pretty successful as well. I’m, I’m more of kind of the visionary person, sales and marketing. So that’s kind of where I focus and, Leslie, she’s more, operational, numbers driven. and that’s, know, that’s where she stays. And then we have different team members different areas that align with their, their skillset. so that’s,

That’s been the of the main factor for us. always continually learning and getting better.

Michelle Kesil (05:57)
awesome, and what have been some obstacles or challenges that you’ve had to overcome and learn from in your journey.

Chase (06:05)
Yeah, I mean, I think, again, it kind of goes back to the people as well. that’s kind of the most challenging part.

not just on our team, but clients and on the management side, we’re working with residents and owners and vendors. So just having the right expectations, setting the right expectations, having some level of accountability in some areas. But it’s always…

of course, if you’re running a business, you can run into, ⁓ cashflow issues and things like that. But, a lot of times it’s, I wouldn’t say the things that are wrong in the business, but you’re always met with challenges, with people. And then of course there’s just challenges, that come with just, just owning a business, or early on it’s, you’re worried about if you’re going to make the next payroll and, you kind of go through the cycles of, good, good months, bad months, just

that part of it. I think the key is, you know, through all that is, just finding the opportunity to grow and get better, you know, through the challenges, and I think, I think the more we, operate these days and the more we ⁓

the more we take on and the more we see them as growth opportunities, the more we, almost welcome them and look for them. it’s, like, if we can, and usually the challenge that comes up is what you need to solve in your business. That is, that is the thing that is keeping you from growing, just in general. So yeah, so those tend to surface and you got to address them head on, not, run from them. And, usually those are your biggest opportunities and for, not only growth, but.

just, yeah, overall development and growth.

Michelle Kesil (07:36)
Yeah, absolutely. And as an investor yourself, what do you feel is what makes property management? Like how do you use some of those investor mindset and things that you’ve learned in order to be a better property manager?

Chase (07:55)
Yeah, I think it kind of ties together because, like for us, when we’re looking for a buy and hold, we’re kind of our own customer, right? So we kind of get to go through the experience of…

what it’s like to be an owner within our company because once we, once we go through the process of acquiring the property, it goes into the property management side. So we’re, we’re, we’re an owner of our own business and I say owner of our own, but I’m an investor or client of our own business and owner of a property in our own business. So it kind of forces us to look at ways like, Hey, we’re seeing this real time through experience.

maybe it’s a vendor issue or something like that. Then, we can correct that within our own investments and then pass it along to our clients. So, so being an active kind of like an active participant in your own business in that sense kind of gives you.

I wouldn’t say an advantage, it definitely lends to, making your business better for other clients as well. So yeah, I think I think it works well in that sense.

Michelle Kesil (09:29)
Yeah, definitely. And what are you most focused on solving or scaling to next?

Chase (09:35)
Yeah, I think just overall growth of the business.

I think we chat a little bit pre-recording here. For us, I believe what we’re really operationally sound, we just wanna be able to serve more clients at this point. that’s kind of the focus for us is just kind of the sales and marketing side of the management company. We’ve been fortunate to grow pretty organically for the past few years we’ve had good success, but I think we’re in a position now where we can really try

to dial up kind of the marketing and the sales side so that way we can service high level. We kind of went at it as the opposite way. I know a lot of people in our industry, they’ll just grow, grow, grow and operationally they’re just all over the place. I think their strategy is just to get as much revenue as they can so they can eventually sell out to someone. So for them, it didn’t really matter. It was just kind of a…

of a growth and sell play for us. It’s a long, a long-term thing for us, where we’re, holding onto the business for awhile. So we wanted to make sure we were sound operationally and we can serve the clients at a high level. So now I feel like we can do that. And now, we’re focused on just, bringing on more clients that we can, help them, with their investments. So.

Michelle Kesil (10:45)
Yeah, amazing. And what are some of those operational strategies or tactics that you feel have led to that success?

Chase (10:55)
Yeah, good question. So we’re pretty tech heavy in our operations and a lot of the pieces of tech allow us to systemize a lot of the operations. So we use one in particular that’s…

We built out all the processes through the system. So it’s more of kind of like a checklist style. So nothing really falls through the cracks in a sense. So everything is laid out and kind of a repeatable.

manner so that way we can eliminate mistakes and guarantee results in that sense. think just having an SOP, like a standard operating procedure around things is key. I think now the world is changing so quickly with AI and technology that you have to be careful how deep you get into your SOPs in a sense and keep it more high level.

Because, know, at some point you get too granular and things change tomorrow and you’re all you’re doing is just changing SOPs because technology is changing that type of thing. So, I can kind of I can go on all day about that. But yeah, just having a repeatable system, around, what we do in the business, I think has has led to the success.

Michelle Kesil (12:12)
Yeah, definitely. And what do you think differentiates you from other property management firms?

Chase (13:01)
Yeah, that’s a that’s another good question as well. We have we have really three three things. The first thing is just our alignment with the owners just kind of the way our fees are structured. we don’t we don’t get paid until the owners do type of thing. We don’t we also don’t markup invoices and I can kind of get into all that but but yeah, just staying in alignment with the owner to make sure that we don’t win until they win type of thing. The other thing is just kind of our

understanding of, just property management investments as well.

You like I said, we grew up here in Houston. My wife’s been doing this for over 20 years. I’ve been doing this for almost 15 years now. So we have, going on close to 40 years experience in the Houston market, just with real estate in general. So, I think, I think that’s a pretty big advantage for, owners that want to work with us. We’re still, not some huge firm where, our clients are just numbers. We’re, more of a boutique style where you still get kind of a, more of a personal service, but you have a lot of, a lot of experience behind, you

of what we do. The other thing is, we track everything. We’re very numbers driven to help with decision making. So, our clients have like dashboards and stuff where they can see performance of their investments. We track all this stuff in the business so we can make ⁓ informed decisions based on numbers. So, just kind of the data analytics behind everything, ⁓ really helps us drive, ⁓ like I said, drive decision making and

not only for us, but for the investors as well, or the owners as well. Hey, is your property actually a good investment? Should you sell right now? Actually, you should probably hold it. It actually is performing well. So we track all that and look at all that. So I think it’s important. We’re not just, I would say, collectors type of thing. We’re really trying to look at the asset and manage it based on performance and that type of thing.

Michelle Kesil (14:48)
Absolutely. And if an asset isn’t performing well, what would the strategy be?

Chase (14:54)
Yeah, again, I think we just have to look at the numbers. Really, you can almost nail it down to one metric and that’s really vacancy. And we just have to kind of look what’s causing the vacancy. I think we’re really good at reducing vacancy. That’s probably where our…

really where our focus is in general. Because like I said, with the owner alignment pricing structure, we don’t get paid until the house is rented. So it kind of forces us to reduce vacancy the best we can. So really, it would just be kind of really just based on the numbers around the vacancy in it. And I could tell you that

usually it’s when it’s on the market, a lot of times it’s a pricing issue. It could be conditioned. think we’re very good at marketing.

or it’s a high turnover property. So a lot of things can lead to that. If there’s a lot of issues with the property, tenants don’t want to stay because they’re always dealing with maintenance. I think we’re very good at being proactive on maintenance and just how we handle it. And, the vendor quality that we have is that we track all that. So we can really just kind of get into the numbers, but really it’s going to revolve around vacancy is going to be the number one reason a property is unperforming.

Michelle Kesil (15:58)
Definitely and as an investor are there any opportunities or goals that you have for that side of your business?

Chase (16:08)
Yeah, I think we’re going to continue to add to our rental portfolio. I think that’s, that’s the key. I think people need to understand there’s a lot of ways that you make money on a rental property. It’s not just like the cashflow. right there.

the debt’s being serviced right by a renter. So they’re building in equity, you get appreciation. You also can have somewhat of what’s called an inflation hedge. That’s probably a different conversation. And then cost segregation is a huge deal. If people don’t know what that is, they need to go and look that up immediately.

That’s gonna probably be your biggest advantage to a long-term hold or just rentals in general, because you can have a huge tax benefit.

regarding that. us, continue to build rentals for long-term wealth, but also take advantage of the tax strategies right now, because right now you’re still getting bonus depreciation, which is a big key to tax savings. So yeah, think a lot of people, I think, get caught up in, and even if you have negative cashflow, that cost segregation study can help you even become full-time.

fully

positive just in general, but I can go on and on about that. But yeah, I think people get caught up in these days. Everybody wants the Dogecoin type of returns, Where it just like, know, in real estate is just not like that, right? Nobody said I bought real estate yesterday and now I’m wealthy, right? It’s a very long-term hold. you some, you’re going to have to go with market cycles and just tough it out. But in the end,

down the line, you’re gonna come out really well. So I think you just have to be patient. It’s definitely the long, you’re playing the long game. And I think a lot of people are very short, short game minded. So, I think if you have a, tolerance for the long game, I think you should enter into that market. But if not, then, maybe other investments are, for you. So,

So yeah, I know kind of went kind of sideways a little bit there, yeah, so we’ll continue to invest long term for sure.

Michelle Kesil (18:09)
Yeah, amazing. Definitely. Real estate is a long-term game.

Chase (18:13)
Yeah.

Michelle Kesil (18:14)
Well, before we begin to wrap up here, someone wants to reach out, connect and learn more, where can people find you?

Chase (18:22)
Yeah, I mean, you can reach out to me on LinkedIn. I think you’ll have it Michelle somewhere on the on the show. So LinkedIn slash in that always messes with me. It’s Chase E Coleman is my handle. So chase isn’t my first name E middle initial Coleman. So chase E Coleman. So yeah, just just connect with me on LinkedIn. Reach out to me. And then if you want to get connected, I’ll be definitely I’m always down to talk real estate investments or business. So if you just want to chat it up, I’m totally

totally cool with that. if you have rental property in Houston, I could talk to you about managing those as well. so yeah, find me on LinkedIn.

Michelle Kesil (18:56)
Perfect, we’ll appreciate your time and your story. Thank you for being here.

Chase (19:00)
Thank you so much, Michelle. Thank you.

Michelle Kesil (19:01)
Of course And for those tuning in, you got value, make sure you’ve subscribed. We’ve got more conversations with operators like Chase who are building real businesses. And we’ll see you on the next episode.