5 Lessons We’ve Learned Investing in Real Estate

At Lutz Sales + Investments, we don’t just broker deals—we’re investors ourselves. And over the years, we’ve made mistakes, learned the hard way, and fine-tuned our approach to building value in multifamily and commercial properties.

Whether you’re buying your first duplex or managing a 50-unit building, these five lessons are grounded in real-world experience—and they might just save you some money, time, and headaches.

1. Know Your Target Tenant (You’re Not Them)

One of the biggest early mistakes we made? Designing spaces for ourselves instead of for the actual tenants we were trying to attract.

Your goal isn’t to create your dream unit—it’s to understand who your target tenant is, what they value, and most importantly, what they can afford.

Key Takeaways:

• Clarify your target rent range, then ask: “What would feel like a win for this tenant at that price?”
• Focus on features that matter to them—like secure parking, in-unit laundry, or updated lighting—not luxury finishes they didn’t ask for.

Design for the tenant you want to attract, not the lifestyle you personally prefer.

2. Don’t Over-Renovate Where It Doesn’t Pay Off

Every investor wants to improve their property—but there’s a difference between value-add and money sink.

Not every upgrade adds value. Before you commit to a renovation, ask: “Will this actually increase rent or lower my expenses?”

Examples:

• New windows may improve efficiency—but if they don’t raise rents or lower turnover, skip them until absolutely necessary.
• Kitchen cabinets are costly. A fresh coat of paint and updated hardware often delivers the same perceived value at a fraction of the price.

Renovate with ROI in mind, not aesthetics alone.

3. Don’t Be Afraid of Small Fees

One of the simplest ways to improve cash flow? Unbundle your costs.

Instead of folding everything into base rent, consider charging small, transparent fees for services like:

• Water and sewer
• Trash removal
• Lawn care or snow removal

Your rent stays competitive, and your net income improves without major capital expense.

Small fees = scalable profits.

4. Decide Where You Stand on Pets (Especially Dogs)

We’ve learned this one the hard way: You need a clear policy on dogs—and you need to enforce it.

In our experience, there’s no in-between. You’re either a:

• Dog-friendly building, with designated areas, pet policies, and possibly pet rent, or
• No-dog building, with strict enforcement and clear communication.

Why? Because the gray area creates conflict, damages units, and drives away good tenants.

Know your position—and stick to it.

5. Think Like a Tenant (Not Just an Owner)

Every investment decision should pass a simple test: Would this make sense to the person living here?

Before you buy or renovate, ask yourself:

• How will your tenant heat and cool the space? Is it affordable?
• Where will they park—and is it safe?
• Where will they do laundry—on-site, or off-site at a laundromat?

These small details directly impact tenant satisfaction, retention, and rentability. Ignore them, and you’ll feel it in vacancy and turnover.

Put yourself in the shoes of the person paying the rent—and design accordingly.

Final Thoughts

The most valuable lessons in real estate investing come from the field—not a spreadsheet. At Lutz, we’ve tested these insights ourselves, and we share them because we want our clients to avoid the pitfalls and accelerate success.

Looking to evaluate an opportunity or fine-tune your current investment strategy?

Let’s talk—we’re here to help you invest smarter, not harder.