Investor-First Property Management: Stop Overpaying & Protect Your Cash Flow

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Show Summary

In this conversation, Boris Portnov shares his journey as an investor in New Jersey and Georgia, discussing the unique challenges and opportunities in both markets. He emphasizes the importance of having an investor mindset in property management and the need for efficient management practices. Boris also touches on the significance of partnerships in real estate and the challenges of winterization in property management. He concludes by sharing his future goals and how to contact him.

Resources and Links from this show:

• • • Investor Fuel Real Estate Mastermind
    • Investor Machine Real Estate Lead Generation
    • Mike on Facebook
    • Mike on Instagram
    • Mike on LinkedIn
    • Boris Portnov’s Email Address: [email protected]
    • Boris Portnov’s Phone Number: (201) 637-6425

  Listen to the Audio Version of this Episode

  Investor Fuel Show Transcript:

  Boris Portnov (00:00)
  Yeah, a property manager could sometimes make or break the operation because if you’re buying older homes and you misjudge your underwriting, the maintenance costs of the property, which is an issue we’ve had in Georgia. I’ve learned the hard way that properly underwriting your maintenance is crucial and you sometimes have to be more conservative and other times you have to tip to the other side of the spectrum depending on the age of your home, the age of your mechanicals.

  Dylan Silver (00:30)
  Yeah.

  Boris Portnov (00:30)
  have

  an analytical mindset on property, you have to understand property, not just on spreadsheets.

  Dylan Silver (02:06)
  Hey, folks, welcome back to the show. Today’s guest, Boris Portnov an active investor in New Jersey and Georgia, and a licensed realtor in New Jersey as well. He’s also scaling a property management company. Boris, thanks for taking the time today.

  Boris Portnov (02:21)
  Yeah, I mean the pleasure is mine. Thanks. It’s an honor to be on the member of show today.

  Dylan Silver (02:25)
  Now, when we talk about being an investor in New Jersey, I’m actually from New Jersey. We were talking about this before hopping on the show. know, New Jersey is one of these places where you’ve got a little higher price points. And also too, I would say while there is an investor community, it’s not like the Sunbelt States. So it’s a little bit of a different, you know, avatar of someone who is an investor. How’d you get started investing in New Jersey?

  Boris Portnov (02:47)
  Yeah, yeah, welcome to Snowy Jersey where the price points is like a high barrier to entry because of the price points and there isn’t really an active investor community. If there is, you have to seek them out. There are RIAs, but it’s definitely like sometimes it’s definitely lonely investing in Jersey. the investment bug hit me since I was a kid when I started managing my mom’s two family home and just fixing things around the home. And back in the day, there was HGTV.

  And yeah, that’s how I got hit by the investment bug.

  Dylan Silver (03:20)
  Now you mentioned before hopping on here, were, you know, investor first mindset before becoming a licensed agent. I had the same approach from wholesale to becoming a licensed agent. And, know, for me, I think a lot of people I’ve viewed it as a way where I could both, you know, not have to outsource, you know, writing offers and that type of thing, and also gain MLS access. So that was the mentality that I had. What was your, you know, impetus for deciding to get licensed?

  Boris Portnov (03:49)
  Yeah, I I had bought a couple places and then I saw their commission checks and I was like, I could definitely do that. If not beat, why, if I can’t beat them, why not join them? But they, wasn’t just, it wasn’t only about writing commission checks. It was about, you know, having insider access to the pocket listings, being the person on the ground and being networking with fellow realtors. And I was able to leverage my license because for instance, I could come to a listing agent and you’re like, you know, I really want this deal, make sure this deal goes to me.

  I’m speaking to the listening agent rather than speaking to my buyer’s agent who in turn speaks to the listening agent. I’m direct access. I could offer them kind of unique things such as, I’ll ensure that you double end the commission, make sure the deal goes to me, ⁓ or other things that help me to scale my inventory, my acquisitions.

  Dylan Silver (04:38)
  Now, when we

  talk specifically about investing in Jersey, are there certain markets that you are active in or that you are bullish on? if, let’s say, for someone who was looking at getting into single family investing in New Jersey, that you would say, hey, keep an eye out on this area.

  Boris Portnov (05:45)
  Oh, I mean, I’m definitely bullish in my neighborhood. I’m a Berding County, New Jersey investor, and I’m definitely bullish on my neighborhoods because my neighborhoods are currently actively being developed. mean, they’re knocking down anything that’s like older, all the banks, banks are struggling around COVID time. All these banks are going out of business. Anything that’s like land that’s not in use is being sought after, it’s being actively developed and all the rental comps are increasing. And there’s a lot of people since

  post COVID that are fleeing the cities, they’re coming into suburbs, they want more land, they want an extra space for remote work, they want an extra bedroom, they want to be in a home as opposed to an apartment. The rents are increasing in my neighborhood. And as a result, even the inventory, the, you know, the inventory that’s built in the fifties and the sixties are older homes. Even, you know, those renovated apartments are also appreciating in line with the new developments. So I’m bullish on where I’m at right now. It’s a high barrier to entry, but

  the rents are rising, the ROI is there.

  Dylan Silver (06:48)
  Now, I also know that, we, cause you were talking before the show, also active in Georgia, right? And so, you know, being active in Georgia, Georgia is a different area and you’re active, you know, in an area that’s, you mentioned two hours outside of Atlanta, right? So to our audience, you know, where are you investing in Georgia and how did you get started down there?

  Boris Portnov (07:04)
  Thanks a lot.

  Well, how I got started is I’m in Augusta where they have the Augusta Nationals, the golf tournament annually. And we had been attracted to that neighborhood because ⁓ there was a big workforce there. There was a big and large employer there. There was several different things that were bullish on. The community was incentivizing developments. We toured the neighborhood and we saw a lot of older homes being fixed up.

  We saw the romance in old town Augusta being redeveloped. It’s a really, it’s a really kind of cool place. Very throwback retro neighborhood that they’re bringing back. And, that’s what kind of intrigued us in the neighborhood. And the reason that I, ⁓ even started investing in Georgia was because I was a sole operator for many years and I wanted to put my hat and throw my hat into partnership. And so I did a few JVs with a few partners and,

  Ever since then, we’ve done a couple of JVs with a couple partners. I’ve had one partner that was the ⁓ repeating factor, the repeating denominator in several JVs I’ve done where it’s been me and him. And then we brought in a couple other people. would find an acquisition and then we would then solicit investor money. And ⁓ he’s really good at finding investors. I’m really good at underwriting deals. We’ve leveraged each other’s strengths to build JVs. And that’s how I got into Georgia was

  basically throwing my hat into partnership and finding the partners, then looking for the asset class. And ⁓ that’s kind of what happened.

  Dylan Silver (08:44)
  Yeah. Look, I mean,

  any time that there is a successful partnership, it does tend to pour rocket fuel onto a real estate operation. On the flip side, know, a tricky or difficult partnership, a challenge partnership can stall everything. So, you know, it is a great thing when it works, right? Now, I also know that you’re active in the property management space as well. And we were talking beforehand, you’re scaling in that space.

  Did this come out of a desire to manage your own properties and realizing that, there’s a niche here outside of what I’m doing with my own investments?

  Boris Portnov (09:54)
  Yeah, the property management is like a real, it’s a real labor of love for me. have a ⁓ huge desire to scale my property management. This because ⁓ I’m not your typical realtor investor. I’m really hands on. Like a lot of individuals are like, okay, they’re spreadsheet warriors or they’re, or they’re good at acquisitions or they’re good at speaking to people. They have social skills. I’m good with all aspects of

  manage property maintenance. know, when people are like, Oh, toilets and tenants, like, you know, for me, that’s like, yeah, that sounds amazing. Sign me up, you know, so I’m all about that. I love I’m I was on the phone this morning

  Dylan Silver (10:31)
  Yeah.

  Boris Portnov (10:34)
  they change the door when you haven’t filled, gotten to the bottom line, to the bottom of where the water is infiltrating from, you know? That’s not the way to approach the repair. So even though we’re, ⁓ even though we’re hundreds of miles away, I’m still actively managing and trying to be efficient in my management. And that’s why I want to become a property manager is because there’s a lot of loss of efficiencies in management. ⁓ There’s…

  Dylan Silver (10:59)
  100%. 100%.

  Boris Portnov (11:02)
  Yeah, because the landlords are being taken advantage of by the managers. They’re charging high fees and then they’re on top of high fees and they’re adding all these different a la carte options that are just costing the owners a ton of money. And they’re not really effectively managing it because they could be throwing dollars at the problem as opposed to really analyzing the problem and coming up with the most efficient effect. I’m a manager for a building in Bogota around the corner from me. They had rotten countertops.

  due to the sinks being shallow and round and the water is pouring out years, a few years is running out. And I said, we don’t have to change the countertops. We could just cut the rod out, put in new sinks that drop in the same size. would cut it out. would, you know, new sink that fit into the existing cabinet, cut out the rot. And this is like nine units. I was going to save them about a thousand dollars a unit. So like just approaching it at a mindset that could find efficiency and savings to people. I want to act as a consultant rather than just your run of the mill manager.

  Dylan Silver (12:02)
  You know, one of the things that people typically have a difficult time with when it comes to property management is that individual not having the or that company not thinking like an investor, right? And so they’re thinking like, well, I’m to get this check one way or the other. Right. And so being that you have an investor first mindset, I can imagine that that gives a lot of credence when you’re having these conversations with investors. And then also, like you mentioned, you’re taking as much a consultative approach as you are strictly managed.

  it.

  Boris Portnov (12:33)
  Yeah, I appreciate you recognizing that. I mean, that’s important to me to treat the property as if it were my own and every manager like my partner, every owner like ⁓ every client like my partner.

  So I

  Dylan Silver (12:46)
  For sure. And one of the

  things that I would like to mention pivoting a bit here is that, you know, wherever people are doing business, one of the things that becomes challenging is as they’re scaling, they have to find a trusted partner, their boots on the ground, their eyes and ears, right? And, you know, you would like to be able to say, okay, we’ve got property management in place. We’re good to go.

  But in many cases, especially when there’s an acquisition and when a new investor takes over, one of the first things they look at as like a potential bottleneck is the property management. And they look at how is this performing? Do we need to replace? Do we need to partner with these people and tighten things up? So having that investing first mindset, would imagine, assuages a lot of those concerns because you’re already kind of tip of the spear when it comes to identifying those issues.

  Again, rather than just looking at it like, we’re here to make sure that we’re collecting rents and that’s the end of our job.

  Now, when we talk about the ideal number of units for someone to start looking at property management, and this is me, my thousand foot view outside looking in, I’ve heard for folks to really have bang for their buck and for them to really consider hiring property management, they should have 50 doors that they’re managing and then it’s gonna pay for itself. Do you agree with that logic? Would you say it’s a different number of doors, more or less?

  Would you say that it depends on what that property manager is doing in the scope of work? What’s your feedback on that in general?

  Boris Portnov (14:54)
  I think every situation is unique. don’t think it’s like ⁓ 50 doors. I think it depends on whether you’re out of state, whether you’re local, whether you’re handy. Someone like myself, I’m going to try to save the individuals as much money. I have clients that own one home. I have one client that he’s attending in the building that I manage and he’s like, are you interested in another job?

  I just bought my first home as a rental and he’s a tenant in the building that I manage. So that’s kind of a funny story. And I’m, constantly saving him money. He needed a new water heater and I just rebuilt his water heater. He just got flooded. We’ve had, we’ve had a terrible winter. ⁓ we’ve had, I’ve had a ton of frozen pipes and crazy, crazy winter storms and two feet snow falls.

  Dylan Silver (15:45)
  It snowed yesterday,

  right? The 23rd?

  Boris Portnov (15:48)
  I should show you out my window what my property looks like. We had two feet of snowfall yesterday. I spent six hours doing my home alone and then I went to all my properties afterwards. I worked for like 30 hours straight.

  Dylan Silver (15:59)
  Now, oftentimes I want to touch on this, you the idea of winterization. I’m a licensed realtor in Texas. And so I can tell you, and I don’t think I’m being too harsh when I say this, ⁓ winterizing is not a big concern. It’s kind of like if the pipes freeze, you know, keep the water dripping. But the insulation isn’t always the best. And for whatever reason, I don’t know what it is, pipes seem to burst all the time in Texas. you know, New England, and if I’m including New Jersey in that area as well,

  you know, I tend to see a little bit less of that. But what are some of the big issues that you see ⁓ in the winter? And is it something like pipes bursting or is it something else like, you know, an icy walkway or something along the

  Boris Portnov (16:44)
  Yeah, that’s a great question. That’s right up my alley. ⁓ And I’m surprised, to be honest, you being from Texas that you even have went to any vocabulary. But it’s funny that you tell me that there’s a lot of pipes freezing frequently in Texas, because I never was aware of that. But I guess it makes sense in their building practices, because they don’t plan for that. Over here, we plan for that. obviously, whenever possible, try not to when you

  Dylan Silver (17:04)
  Right.

  Boris Portnov (17:10)
  When you’re building whenever possible, try not to locate your pipes, your supply lines and exterior walls. know, ⁓ certain neighborhoods and certain they have, you you have your state codes and you have your municipal codes. And sometimes your municipal codes are more restrictive than your state codes for certain good reasons. So ⁓ my buddy was telling me he lives up in upstate New York. He was telling me that where they build, you’re not even allowed to locate pipes and exterior walls when you build new developments. That was news to me. I thought that was his best practice over there. It’s required. ⁓

  I would see insulate, know, insulation, pipe wrap, heat trace wrap. There’s different things you could try to do to mitigate, but it’s all about insulation ultimately. ⁓ And having the foresight, you know, I renovated a few bathrooms here and there. And then when I see pipes and exterior walls, I’m like, what, could just relocate the shower. We can move the mixing valve to the interior wall. You know, and I’ve done that a bunch of times, ⁓ just to foresight, you know, and ⁓

  Dylan Silver (17:51)
  Yeah, yeah.

  Boris Portnov (18:10)
  Yeah, it’s all about installation.

  Dylan Silver (18:11)
  Yeah.

  When we talk about winterization, I think it’s interesting. You mentioned, you know, have winters in Texas. You know, we don’t often get freezes, but when it does happen, and it seems like it’s been happening quite a bit recently, you know, pipes can burst. can really affect, you know, septic systems, which are very common throughout Texas. And then, you know, the grocery stores get raided. It’s crazy. So one of the things that I actually did miss from living ⁓ in New Jersey and also Massachusetts was

  you know, not having to deal with that as much as because people were more prepared. And don’t even get me started about the roads. The roads will be another issue entirely. Anyone that’s from Texas and has lived through a freeze can resonate with that. We are coming up on time here though, Boris. Any new projects that you’re working on and then as well, what’s the best way for folks to get in contact with you?

  Boris Portnov (19:04)
  ⁓ yeah, so I’m, I’m just right now I’m focused on growing my property management specs, my influence. ⁓ and I’m always looking at deals, underwriting deals. ⁓ I’m not working on anything right now because every day I underwrite maybe like a half dozen deals and it’s about a numbers game. It’s that one in a thousand is the one that’s going to be the deal. And so I haven’t done a deal in like about nine months. ⁓ but I’m still looking actively all the time and I’m also looking to take on new clients for property management.

  and grow my influence in that realm. And I can be reached up at my email is bportnov. You’ll have the spelling of my name. It’s just my first initial, my last name, my Gmail. And my phone number is 201-637-6425. And that’s how I can be reached. I’m good with texting, calling, whatever.

  Dylan Silver (19:56)
  Thank you, Boris. Thank you so much for your time today. Thanks for coming on the show.

  Boris Portnov (20:01)
  Yeah, it’s been my pleasure. Thanks so much for your time.