Prioritizing Property Portfolio Tasks: Nick Curum’s Framework for Landlords

In a recent LinkedIn post, Nick Curum offers a practical framework for landlords to prioritize tasks related to their property portfolios, distinguishing between activities that protect assets and those that grow them. Curum emphasizes the importance of tackling ‘boring jobs’ – those that mitigate risk – before pursuing more exciting growth opportunities.

Curum introduces a categorization system for landlord jobs, dividing them into four boxes based on two key questions: ‘Protect or grow?’ and ‘Easy or hard?’ This matrix helps to clarify the immediate and long-term implications of each task.

The Four Boxes of Property Management

According to Curum, understanding these categories is crucial for effective portfolio management. He outlines the four boxes as follows:

1. Easy and Protects

This category includes tasks that are straightforward to complete but essential for avoiding penalties. Curum uses the example of a gas safety check, which is legally required every 12 months. He highlights the significant financial risk associated with neglecting deposit protection:

“A deposit protected late can cost three times the deposit.”

Curum stresses that this is a fundamental duty for landlords, underscoring the ease with which this risk can be managed compared to the severe consequences of failure.

2. Hard and Protects

These are more complex tasks that are vital for maintaining the letting status and financial stability of a property. Examples provided include energy efficiency upgrades, as properties below a certain rating cannot be legally let, and remortgaging, which is necessary to manage fluctuating interest rates when a fixed term ends.

3. Easy and Grows

This quadrant focuses on proactive steps to increase portfolio value and income. Curum points to rent reviews, which can be conducted annually with appropriate notice, and the swift re-letting of properties to minimize void periods. He notes the financial impact of vacancies:

“Relet quickly: an empty month is about 8% of a year’s rent.”

These tasks, while requiring attention, are presented as relatively simple ways to enhance returns.

4. Hard and Grows

The most involved tasks, aimed at significant portfolio expansion, fall into this category. Curum identifies refinancing to release capital for new acquisitions and the process of acquiring the next property as prime examples. These ‘fun jobs,’ as he terms them, require substantial effort but offer the greatest potential for growth.

Prioritizing Risk Mitigation

Curum’s core argument is that landlords should prioritize the ‘protect’ categories before focusing on ‘grow’ opportunities. He advocates for addressing the ‘easy and protects’ tasks first, suggesting that this forms the bedrock of responsible portfolio management. As Curum advises:

“Clear box 1 first.”

He suggests that tasks like ensuring timely deposit protection should be a primary focus, especially when considering renewals or involving co-owners and letting agents. Curum believes that a ‘board reads the risk register before the growth plan,’ implying that a solid understanding and mitigation of risks are prerequisites for strategic growth.

The author concludes by linking this prioritization strategy to the broader concept of a portfolio system. He mentions that knowing what to do first is one of seven essential components for a property investor and directs readers to his ‘7 Pillar Property Investor Scorecard’ for further assessment.