How to Buy Your First Rental in 5 Days with Hailame Kinikini

When I entered the market back in 2018, right. How I had a terrible listing. I knew about it. I just wanted, I really, it was by laziness. I was like, I don't want to move my furniture. Right. And you know, I made money. Right. And that, that is where I think a lot of people entered the market.

Welcome to the Next level Income show where it's our goal to take your income, your investments and your life to the next level. I'm your host, Chris Larsen. If you haven't yet, get a copy of our book for free free at our website nextlevelincome.com that's www.nextlevelincome.com. just click on the book link and I'll even send you a copy if you put your address in. On today's show we have lame Kinnie. Kinney Lami is the founder and CEO of Elkridge Management and is a creative finance expert and real estate entrepreneur. He has quickly become one of Utah's leading real estate leaders, building the community into a seven figure business in under a year. The company Elkridge specializes in all things short term rentals and currently manages a portfolio of over 150 doors. LAMI considers himself a ser entrepreneur having started to build out other complimentary businesses to the short term rental space which include capital funds and turo while working towards the goal of having unlimited time to spend with his wife and three children. Lam, welcome to the show.

Hey, excited to be here Chris. Thanks for having me, brother.

Yeah, I am, I am as well. And we're going to talk about some cool strategies that investors can use in their, in their investing journey. But speaking of journeys, you have, you have a really cool journey yourself. Lame. We were chatting a little bit before the show. You live in one of my favorite areas of the country just outside of Salt Lake City. Love to mountain bike there. I love to ski there. I've had some just lifetime memories with, with, with specifically my older son there skiing for his 13th birthday last year. As a matter of fact they're up at Alta. But yeah, if you don't, if you don't mind, share a little bit of your journey with the audience. How you got here today.

Yeah, so my background actually is very interesting because I come from, I come from the sales world specifically in the old school door to door knocking.

So I started body should have to do that. I think everybody like you should come out and, and have to knock doors.

100% and I, it's funny because I, a lot of people ask me like hey, you know what's the most valuable, you know, skill set in. In real estate? And, you know, I'm always, I'm. It's, you know, it's communication, it's AKA sales. Right. And I owe a lot of. I owe a lot of what I've built based on that career. I was, I was selling for a company called Viv. Had a very successful career there, managing sales team. We would go out in the summer into different markets that, you know, were strategically identified, and we would literally knock doors cold. Right. And I did that for about seven years.

Wow.

And towards the tail end of that career, which is around 2017-18, was when I started to kind of mingle in real estate. I started to kind of do it in tandem with my sales career. I. A house traditionally just on an FHA loan, primary residence. I. A year later, I moved out of it and I told my wife. I was like, man, I. I'm freaking lazy. I hate moving. I don't want to move furniture. Like, what? Let's just keep it in here. Right. And. And so that was. And this was in 2018, and that was my first taste of Airbnb. We didn't know it was going to be an Airbnb until it turned into one. I remember thinking to myself, like, hey, if I can just break even on the mortgage, good, I'm set. And so in the first month, we netted $2,000 after all costs. And I was like, wow. So, yeah. And honestly, I have that listing deal on my profile simply for kind of just memory's sake, because, you know, now that I look at my business now, you know, it's, it's, It's a terrible. It was a Airbnb. It was terribly managed. But, but that, that's how I got my start was I kind of mingled in Airbnb space. We kind of ordered today. We now, you know, own over 100 doors. We have about 150 doors under management. But we started in between then and now. It started as a management company, specifically in the short term rental space. We started to get really good at that. We wanted to figure out how to essentially acquire properties. And so that's when I found this special thing called Creative Finance around Covid and the market swung. It came in our favor. Interest rates, as we know, are higher than, you know, what people normally like to see or have seen recently. Yeah. And that's a lot of opportunity for us to kind of kind of go and buy to our. So that's kind of, that's kind of the journey in A nutshell.

So I love it. I love it. And there's, there's a few things I want to touch on today. But first, you know, you and I share a background in sales. And I think that, you know, there's this whole stereotype of, you know, the, the sleazy salesman, oh, you can sell ice to an Eskimo. And I always, I always thought, like, why, why would. Why does an Eskimo need ice? And, you know, you really, you really summed it up lame. Which is sales is communication. And I always say that if you can sell, you will communicate better in every area of life. I started reading Zig Ziglar when I was in college and, you know, learning, learning how to sell. And then I'll never forget reading Rich Dad, Poor Dad. And Robert Kiyosaki said, the number one skill you can learn is, is sales. And I've come to say everybody sells. My wife's an architect. She works with clients. She has to sell her company and her visions. When she talks to clients, she has. Yeah, she was at an approval board meeting last week. She has to sell the concept. And really it's just communicating and doing that. You mentioned that it's really helped you out. Maybe you could kind of touch on some more specific points, you know, that, that you've learned in your sales career and how you apply those today.

Yeah. You know, like you said, right. Sales at its core, simply communication. And I think even further than that is, you know, it's more specifically understanding, finding, identifying, and then problems.

Yes, right. Great point.

And that's, that's genuinely what I feel like the best quote unquote, salesmen are is they're simply the best, like problem identifiers and solvers. Exactly. Right.

I love that.

And so, and so in real estate specifically, you know, where it's been, huge value add and, you know, when it comes to real estate, you and I both know there's a huge blessing and a curse, Right. And that is the. That there's a million ways to make a million dollars in this industry. And so being able to articulate and identify a very specific problem in this world of real estate has proven to me to be very successful for my career. And for me, it just happened to be short term rentals. And so when I identified short rentals and I decided to jump into it, I kind of accidentally backed into it as I shared my story. Um, I just got really good at identifying the problem and then communicating how I could solve that to, to the masses. Right. And it started out in the management space originally, which was, hey, you don't have time to do this, you have time to study this. You don't want this to be full time job. Let me solve this problem for you and bring value to you. And then as it evolved into creative finance, that was a huge problem to be solved, which is there's a lot of motivated sellers, people not moving because interest rates are so high, but then also not understanding that there are other modes of disposing your deal, right? Like people just, you know, it's sad that there are a lot of sellers in today's market that just like the MLS is the only way to get rid of your property, your liability, right? And so it's, so it served me extremely well to be able to communicate to these motivated sellers, like, look, I, I'm not here to, you know, nickel and dime you. I'm here to creatively solve your problem. You know, let's talk through this, right? And, and that also is like where I love what I do. Because you know, if I'm trying to buy a property cash, right? If I'm a flipper, I'm trying to buy this property cash, I have to be a shark. Kind of like I have to, because the numbers are the numbers. I have to get 50, 60 LTV for there to be enough spread for me to go and make a return, right? And so that makes way for like, you know, you got to kind of be aggressive. What I love about creative is that it is a, it allows me to approach sellers with empathy, right? Because I'm just coming to them like, not that you couldn't buy in cash, but it's just a lot easier because I'm like, hey, what's your problem? You know, we can push and pull on all these levers. Purchase price, rate, amortization scale, balloon. Like those are all things that, you know, if I'm going to give in one, I need to take in another. But usually I only need to solve two of those problems for people and then I can take in the, in the other, the other, the other categories, right? And so, so that's, I've, I've loved what I, what I'm doing now and I, and sales has allowed me to be able to solve these problems effectively. So I love that.

And again, what you said, which is, you know, understanding the solution that you have and then understanding the problem that your end user, your client or your customer has and putting them together to provide value. Like Zig Ziglar says you can have everything you want in the world. If you help other people get what they want 100%, I think that's fantastic. I was talking to my. My older son. He's his. His goal in life is to be a D1 lacrosse player. And he's. He's very talented. My younger son is as well. But my younger son, he has a vision. He wants to be in a. An engineer and design cars, which they may be spaceships by the time he's old enough. But my older son one day was saying to me in the car, he's like, dad, you know, Miles, that's my younger son, he wants to be an engineer. And he's kind of. He struggles in school a little bit lame. My older son. And he said, he's like, I don't. Like, I don't. Miles wants to be an engineer. I don't know what I want to be like, what I want to do. And I said, what do you. Like, what do you think you want to do? He goes, I want to be like you. I want to be an investor. I said, well, I said, to be an investor, you need money. And he's like, well, dad, how did you. How did you get money? Like, where did you come up with money? I said, well, I was. I was in sales. And he's, you know, he. It was kind of confusing to him because this is the unfortunate thing. Lame. Is that we don't talk about sales as a career in college. Like, we do these other career options that are out there. And the thing is, it's that the thing is, if you're in sales, you probably don't go to college to teach sales. Sales is more like an apprenticeship type thing. And I was explaining to my son, and I said, you would actually be good at sales. And he looked at me, like, very confused because, you know, he. He doesn't. He doesn't think that he's, you know, academically inclined. And I said, he's like, well, why is that? I said, well, Ethan, you're good at. You're good at remembering things, and you're really good at communicating to people and. And listening to people. And I said, that's really what sales is, is communication. And. And his eyes lit up because he's like, wow. Like, this is. This could be something that I can do. And if you're listening, especially if you're a younger person, look. Look on your desk. Look in your car, wherever you're sitting, everything in front of you. Somebody sold that. Somebody sold that. So there's. There's a tremendous opportunity out there. And I Think if you can communicate in this world, especially in the technology that we have, and specifically, if you have empathy, as you mentioned, lame. Empathy for your client, for your end user, and you're looking to provide value, you can do very, very well.

Absolutely. Love.

So, yeah, I just wanted to underscore that and I appreciate you summarizing. So I want to, I want to really focus on the creative aspect. But before we do, I know your business focuses on short term rentals. Lame. We've had, you know, your partner Kyle on, over, over the past few years here on the show. He's, he's been a frequent guest on the show. Let's, let's start by talking a little bit about what's happened in the short term rental space. Is it, is it still a great market? You know, I, we built our property here in Asheville, and 10 years ago, when Airbnb was just getting started, I was like, hey, like we're going to put an Airbnb on our property. We have two here in Asheville and they really help out in paying our bills, if not our entire mortgage on, on our home. And we have a pretty nice home. Give the audience an overview of the short term rental market, the Airbnb market, the VRBO market, and where we stand today.

Yeah, you know, I spoke to when I entered the market back in 2018, right. How I had a terrible listing. I knew about it. I just wanted, I really, it was by laziness. I was like, I don't want to move my furniture. Right. You know, and, you know, I made money. Right. And that, that is where I think a lot of people entered the market. A statistic most people don't know is that 40% of the inventory on Airbnb was onboarded between 2019 and 2021. So there was a huge increase in supply.

Yes.

Now that did a few things. Right. The, the, the term that we hear nowadays that's floating around on Tick Tock, everything is that Airbnb is saturated. Right. Airbnb is dead. It's dying. Now, looking at the numbers and understanding the interpretation of what people actually mean by that, what's actually happened is the market has matured.

Yes. I love it. That's exactly what I was thinking when you said that. I feel like the market has matured. That's a great point.

Absolutely. And that's, that's where I think the difference in that is where is where the opportunity lies. Right. Because another statistic I'll show to you is like, because Airbnb specifically is a super Segmented. Segmented industry. Meaning like there's a million small mod. Right. In fact, that's the majority of the inventory.

Yep.

What's crazy is that 30% of the income of Airb as like the money generated on Airbnb is going towards the top 5% of professional managers. And so it's mature.

Is going towards the top 5%. Wow.

Yeah. And so it's matured in a way that like people are just playing it at a high level. Like people just don't understand that there's a way to play this game strategically. Right. Yeah. And that's what the maturing of the market did is when everybody entered the market, there was just a, there was a vetting process naturally that the consumer created, which was, hey, I'm gonna to this host because the amenities, because communication, because xyz. Right. And so that's where it just started to become a more mature market. And to play the game well, you have to understand certain things now. And that's, you know, to think about the game whole a lot differently now. That's not to say because I hear a lot of people, they're listening to this and they're like, well, does that mean I have to quit my job and start a professional company or so? That's not it at all. It's really just understanding what a consumer is looking for when they go to book of Airbnb. Right.

Yeah.

There's the majority aren't looking at. Right. And kind of the primary recommendations are the things that like the top 5% is doing is they. They're professionally staging. Right. They're not shopping anymore, just at Walmart. Right. It's a quality place.

Yeah.

But then on top of it, the whole back end of professional services that really, there's a lot of tech out there that makes it really easy on you Calendar management, pricing strategies.

Right. We use all that stuff and a lot of it we learned from working know with, with you guys, you know, that, you know, originally Kyle. And yeah, it's the thing is, the wild thing is the technology that's out there. Lame. It allows, you know, even, even small users to use pricing tools that were only available to, you know, like in, in some cases proprietary systems for hotels and certain things. You know, just in the last five or 10 years. Yeah. What amazed me is over the, over the past few years when I talked to people that had been, you know, doing Airbnb longer than my wife and I, they weren't even using these tools. And it's really hard to optimize and do that. So I think, you know, to your point, if, if you're gonna enter the Airbnb space, if you're gonna enter the short term rental space, enter it as a business, treat it like a business, and you can be, you can still be very successful. But I think a lot of people jumped in, said, oh, I can make easy money. You know, I'm getting.023% interest rates on my, on a loan and buying a property and thinking they can make a ton of money. But they're not spending the money to have professional pictures. They're not spending the money to integrate their, their cleaning staff to have faster turnovers, to, you know, adjust the pricing on a, on a regular, if not daily basis based upon what's going on out there. And it takes, it takes a little bit of time. But my wife, she probably manages our two Airbnbs in about 10 minutes a day at this point. But we have, but we have a team, we have a back end team that does, that does the cleaning and those sorts of things. Exactly. Yeah. So what, you know, aside from, you know, running it like a business, what are some other tips that you have for, for listeners that either are just entering the short term rental space or are intrigued by it and say, hey, this is a, this is a potential option for me going forward. Are you a high income business owner or professional earning 2,300,000 or even more a year, but still feel like you're living paycheck to paycheck? Are you comfortable working until you're 65 or 70 to retire? Or do you want to achieve financial independence and live life on your own terms? You could join myself and Matt4 and learn how we both became financially dependent in our early 30s. We'll teach you how to make, keep and grow your money. Teach you strategies to maximize your earnings, keep your income that you've earned through tax strategy and legal structures, and ultimately teach you how to grow it by determining your personal investing strategy as well as teach you how to analyze investments so you can grow your passive income to the point to live life on your own terms. Our coaching clients reliably do this in seven years or less. To learn more, check out our coaching program@nextlevelincome.com forward slash coaching. That's nextleincome.com forward slash coaching.

Yeah, you know, the, the number one mistake that I feel that I see a lot of operators make is they are too narrow minded when it comes to driving occupancy. Okay, okay. Like nowadays, Airbnb has created lazy operators because you can post on Airbnb and automatically you have millions of views, right? Millions of eyes that are looking and marketing. Like everybody's marketing. Your, your listening to them. There are other billion dollar industries and verticals that are really in high demand for furnished rentals that a lot of people don't think about just because they're not willing to put in the work. Right. And the two major ones, so you have obviously billion dollar industry number one is just travel, vacation rental, the natural avatar of coming to visit family, go on vacation, etc. Right. That's Airbnb. Okay. That's vrbo, that's booking dot com. It's all these platforms. The second is insurance. Okay, one more time. Is insurance.

Insurance.

Yes. We just signed a for two bedroom, one bath in Salt Lake City. Okay. We had a broker approach us. There was this young lady that her house flooded, okay. And this broker is her insurance driver. And he called us because he's trying, he's looking for a property to place this young lady in because the hotels is just crazy expensive. But more than anything, you know, they like the, the guest doesn't want to stay there. Like she hates being a hotel. Right?

Yeah.

So we signed an insurance contract for a two bedroom, one bath for $3,750 every two weeks. Okay. This is north of $6,000 a month, right. For this furnished rental for this insurance contract. Right. And what's crazy about it is like that was an easy sale. Like it wasn't like it was just an insurance adjuster just trying to care of his client. They have a budget of allocation for housing, which is usually significant. And then they're just trying to appease their, their client. Right. And so. And you can just deliver very simply on like hey, I have this furnished rental, you know, becomes a big opportunity of like then driving that occupancy that isn't reflected in short term rentals data that we normally are looking at. Right. And the same goes for government contracts. Right. We Moab, we have a property where we housed a general contract. Yeah, it's beautiful. But we have, we house the general GC that was there working for the city on a city job and they paid us for a five bedroom in Moab. They paid us ten grand a month for a couple months. Right. And it was, it was a five bedroom and they just had a bunch of guys in there because they would have rather stayed at a house, right?

Oh, absolutely.

Yeah. And these are from big budgets that like, to be honest, like you just have to check a few boxes for them to write the check. Right. You're not, you're not convincing a normal consumer to spend their own money. You're just trying to get the gatekeeper to like you. Right, right. And so, so these are billion dollar industries that drive occup. You can drive occupancy. Now the reason why people don't do it is because they're just not willing to get dirty. They're not willing to like find the deal, you know, go network and things like that. And so. But yeah, yeah, but they're out there. They're out there. Like these things are out there. And we get, you know, three to five inquiries a month at least, minimum of insurance contracts. Right. And you know, Grant, we've been able to be nimble because, you know, the wider you are, the more availability of doors that you have, the more flexible you can be in, like moving people and. Right. But again, coming back to, even if I had one property, like, I wouldn't be narrowly minded, only focused on just the easy occupancy, which is short term rental, Airbnb, all the stuff that we know, I would be actively engaged in trying to find different ways to market my property. Right.

So I like that. That's a great, that's a great strategy. And again, it's being creative and open minded, like you said with these things. And that's after you have the property. But let's talk about being creative to get the property in the first, in the first place. One of the, one of the posts I love that you did lame was how to get and correct. Correct. I'm kind of paraphrasing here, but how to acquire your first property in five days. And I was like, whoa. I was like, how did he do this? So I'd love for you to share, you know, a little bit about that with the audience. And you know, you mentioned, you know, flippers. I think there's a lot of people out there that they think, hey, the, the way to buy a property is, you know, you go to a real estate agent, you look on mls, the way to sell the property is the same way. But there's a whole nother world out there in terms of acquiring properties off market using creative financing. And that's really what you specialize in.

Absolutely. And I, I think, to preface, I think there's always like a kind of just an education piece that a lot of people need to understand. And that is creative finance is an umbrella term. Right. That houses a bunch of different acquisition strategies that are alternative acquisition strategies to what we know which is going and getting a traditional loan, qualifying for it, giving your taxes, earnest money, have season money, yada yada yada, right. Credit, all that. There's a whole umbrella of acquisition strategies underneath Creative that really are a much more simpler way of buying a property. When you buy your first property. Creative, honestly, it's such an eye opening experience because most people don't know that this thing is available. Right, right. And the two primary that I'll touch on because there's a lot, right? There's a contract, lease options, MLOs, there's a ton. The two that are primary in today's market that are most relevant is seller finance and subject to, there's guys, guys I consider mentors, right, Chris Prefontaine, Pace Morby that go deep into these acquisition strategies. But in a nutshell, these are opportunities to be able to transact a deal with a buyer and seller directly. When I am doing a seller finance deal in a simple, just tip of the iceberg, like kind of context, all I'm doing is I am just creating a note that is now between me and the seller and I am making seller my bank. So instead of paying a mortgage to, you know, a bank note that I have to go and qualify for, you know, I basically just writing up an agreement and I'm saying, hey Chris, let me buy your cabin, let me buy your property. But instead of paying the bank all this interest, why don't I just you make, make you the bank. Let's make your money and your equity work for you. Right? Now that's where sales, they have like.

3 or 4% financing, right?

Exactly. Right. When you understand an amortization scale, it's a lot of money, right? It's, it's a lot of money over time, right? And so especially early on, right. And, and so these are, these opportunities are out there. It's so funny because every time I explain this strategy 1 People's minds are blown. Cause they're just like, wow. That's because in a seller finance deal, guess what? All I have to do is get Chris to like me and then really once he trusts me and he's ready to sign, he can go, right? So in that process, there's no credit checks. I don't have to provide taxes, I don't have to. A lot of times they don't even care. Like they don't care where money comes from. It doesn't need to be my own money. One of my claims that I love saying, that's kind of a wild thought is I bought a Condo in Park City. Credit card. I bought a condo with a credit card. Right. And that's because in the creative space of me buying from a seller, they, they just, the money, they just need the down payment. They don't care where it comes from. Right. And so, um, so anyways, but the first response I always get when people hear that is one, they're mind blown and then the second is doubt, right? Then they're like, this isn't real. How many motivated sellers are there? Like this is a needle in a haystack. I literally get dozens of emails a day about deals that are available. And the reason for that is because the market is called for it. Right. Interest rates are so high that people can't sell. There's a lot of motivation out there. People can't sell. People are looking for ways to make their money work for them. They're not wanting to cash out on equity because they're going to take a discount on equity because of where rates are at. And so there's a lot of opportunity. But again it's really the people that just are willing to put in the work and, and understand it and you know, go out there and find them. Right?

Absolutely. Absolutely. Yeah. And it's again, it's, I think it's, it's an interesting time. We're seeing a lot of seller financing in the mobile home parks we buy because you know, these owners, they a lot of them own the park outright and now that rates are 7, 8% they're willing to, to take a note back on that. Whereas if it was like 4% they'd be like I can do better with my money elsewhere or 3% or something like that. They're like, just give me the cash and, and let's rock and roll. So yeah, it really, and this is where if you're listening, understanding the options that are out there to buy, to sell in in the world, as the real estate cycle moves and conditions change and the environment changes, you can, you can utilize these different strategies 100%. So Lami, tell us a little bit about your business for listeners and, and how you work with your clients.

So Elkridge Management by now I'd say is, is, is more accurately defined as a real estate firm that's vertically integrated that focus on short term rentals. And so under the umbrella of Elkridge Management, we have a management company that basically is a service, it's a done for you service. Right. If you have an Airbnb, you don't have to worry about finding these insurance contracts. You don't have to worry about all that networking. I'll do it for you. We come and manage it for you. Have an acquisition arm for investors. I actually have a debt fund that I manage. And so if people are just wanting to place money that's asset back using this strategy, we have opportunities for people to make money and put their place, put their money in a good place. And then third is the education arm and that's fearless. And so there's a lot of people out there that are just wanting to buy their first property. Right. And they want to do it themselves. They, they want to call themselves investors. And I love those people because I, that's where I come from. And so, so I across those three, we've just made it really easy for really our top of funnels. Anybody that would be involved in short term rentals no matter what you want to do. Right. And so whether you have a property, you know, and you want us to manage it, whether you want to jump into it as an investor or whether you want to learn about it. Yeah.

So one stop shop. One stop shop. And what's the best way for listeners to learn more about you guys?

My Instagram is going to be the easiest and that's at H A I L A M E K so high. Lamikaylam is my first name. So full name. But yep, that's it. So perfect.

And we'll have that in the show notes. So if you're listening, you're like whoa, whoa, whoa. How many A's and eyes are in there? We'll, we'll put that in the show notes here so you can just click on Lame's Instagram profile and check it out. Lame, it's been a blast talking to you. Enjoy. Enjoy your. You know all the tips that you given to our listeners not just from the communication and sales side, but also for those listeners that are interested in the short term rental business. If you are, reach out to Lame. Learn more about what he does on the education side as well as the management side. Lame, thank you so much.

Hey, thanks for having me Chris. Appreciate it.

Hey Chris, here again. I hope you found this episode valuable. Now I have one more thing to give to you. We have a page for my coaching clients where you can get a free copy of my book as well as much more from previous guests on the show. Just check out nextlevelincome.com coaching to get a free copy of my book, audiobook and much more. I'll send you a copy of my book and cover all the shipping costs. As a thank you for listening to the podcast. Also, please like share and take just 90 seconds to give us a rating on Apple Podcasts.