Like Dr. Bull, Sometimes the Best Property Management Looks Bad

I occasionally watch the television show, Bull.  Dr. Bull, played by Michael Weatherly (formerly the affable “Tony” from NCIS until he left to get his own show), is a “jury consultant” who helps his criminally-charged clients pick a jury who will be sensitive to their plights and vote “not guilty” when the time comes.  He and his talented team of specialists measure jurists’ reactions during the trial and change defense strategy based on their body language and other factors. 

 

Of course, like most TV shows, things always go from bad to worse in the first 45 minutes of the show.  “The client didn’t tell them he was romantically involved with the deceased!” or “Not only was she the CEO of the pharmaceutical company who would benefit the most from the stolen formula of the new cancer drug, she also happened to be the hired dog walker of the pup who had to have its irritated stomach operated on in which the stolen cancer pills were discovered!” (OK- that storyline hasn’t made the show yet…)  But Dr. Bull and his team are inevitably able to pull the strings in the last moment to get the favorable outcome we all hoped for, no matter the odds.  Bravo, Dr. Bull and associates!

 

But real life isn’t always so neat and uplifting.  I remember in 2008-2012 we had clients asking us to sell their homes that were saddled with loans that were 25% more than the market value of their houses.  So, much like Dr. Bull making magic for his clients… no, we actually couldn’t find anyone to buy them. 

 

But that’s just the part when things go from bad to worse- it’s like TV, right?  So we thought like Dr. Bull and came up with the silver bullet to just rent the unsellable houses out in the meantime.  Yeah!  That will work…. But the market rents (and our fee for management included) left the rental homes negative cash-flowing a few hundred dollars a month for our clients…

 

Well, this is the season cliff hanger, right?  Where things go from bad - to worse - to much worse - before the glorious ending?  This is how excitement builds, right?

 

So our next Dr. Bull-like epiphany is to hold the property for years while it negative cash flows.  So, not only are these clients losing a few hundred dollars a month, there are also losses due to repairs, maintenance, and vacancies.  And this goes on for years…

 

OK, this sounds like a downer, a depressing TV show that needs to be cancelled!

 

But, the funny thing is, I always felt like our best work happened back in those years when it could be argued that the results were the worst.  We were able to fund stable tenants in a tough job market and economy to keep income flowing in.  But it didn’t look pretty.

 

I haven’t seen any episodes of Bull where the good doctor gets a slam-shut life sentence case knocked down to only 20 years in prison for his client.  Or a 20-year sentence knocked down to 5 years.  That doesn’t sell.  But, if he wasn’t a fictional character, it might be some of the case work that he was most proud of.  There’s maybe some skill in taking really bad situations and turning them around slightly to make them better, albeit still imperfect.

 

It’s been on my mind as we’ve had some of the aforementioned underwater homes from almost a decade ago sell in the past few months.  These long term clients who mucked through some tough market times with us walked out of their closings with $50K-$75K checks in hand.  Not too shabby!

 

So maybe there is a  future Bull storyline here after all?

 

Happy Landlording!