Deadly Mistakes Investors Make | Real Estate | Real Estate Investing | REI | Ep. 51

All right, we're live. Hi, Freedom fans here with the, like, the genesis of it all.

That's weird.

You're like a celebrity now.

I don't know about that. Again, I just not like being. I like not being the boss. I'm just gonna go back to that always.

There's different kinds of authority, right? There's I'm responsible for the details authority, and then there's the I'm the expert authority. You still got that. I'm Aaron Davis, the CEO of the Freedom Family Companies, here with my boss, the founder and really the engine that kind of got this all started. Danny, our chief investment officer.

Yes, yes.

So you're doing bigger and cool things and some new space here, and it's kind of fun to have you back in the booth and us doing this together.

We don't do that very well. No, we don't. No, it is fun. I was excited when I got the invite. Yeah.

This is a little bit of an extension to our conversation that we started in vlog number 67. This is podcast number 51 talking about deadly mistakes in real estate investing. Yeah, I'm glad they're not really deadly, because I've made all of these. Oh, man, if they were literally deadly, I'd be dead.

Yes, yes. Us, too.

I feel like I've hit most of these checkboxes at some point and gotten away with it because I didn't get into the worst of it. But we're kind of coming at this from two different perspectives. Your head is now in syndications and multifamily and some bigger deals, which is cool. Yes, really cool. Much cooler space in a way. But I spend a lot of my time dealing with our turnkey investments and customers.

That's right.

In our rental properties and our property management. And that's what I've done personally myself. I've done a lot of flips and rentals and that kind of thing. Yeah, so my head immediately went to that and your head went to the. The big hairy stuff.

I know. It's kind of cool, actually, when, you know, I said. I started going through my list and I heard yours, and I was like, whoa, hey, we've got a lot to talk about here. Better watch out. We can go for hours.

Ladies first. What's the big. The big hairy, deadly risks that come to your mind?

Well, I'm going to talk about rehab because it came to mind that it kind of applies to a little bit of both, because I mentioned in the blog that, you know, we had lost $40,000 on a deal. And I'm openly honest about stuff like that. Because when you're vetting people and you're having this conversation about who you're going to invest with, you want to know the goods and the bads. And so I'll just openly be transparent about. This is what happened. And here's how we treat.

Let me show you my worst.

Right. Yes, exactly right. And there's an immediate trust built there. And when I'm working with private lenders and they're saying, well, what happened to those lenders? And we talk through that conversation, it's a world of difference. But a deadly mistake was having the wrong project manager and the wrong crews on those properties, because the project where we lost $40,000, they weren't even checking that things were done when we went to pay them. So we're paying every single week for a bathroom that didn't get done. And it was silly, silly mistakes, but it was growing so fast that you weren't paying attention to details that you should have. And so for us, that could have been deadly had we not been in a volume game and we had other wins.

That's right.

That was able to cover it.

Yeah, that's right. If that was your sole move, you'd have been screwed, right?

Yes, yes.

And so the lesson learned there, I guess, is better partners, the big ones who have the big influence.

Yes.

Your operator, your renovator or underwriter.

Yes. Yeah, yeah. Underwriter was a big one. Yes.

A few different parties, but yeah. Your key partners in a deal. You have to bet them.

Yes.

Right. In the turnkey world, it's your property manager.

Yes, right, yes.

It's also the renovation crew and like, what's their track record and history? Like, you know, how do you know? Yeah, right. Especially if you're buying long distance, that kind of thing. So betting those two parties is really key.

Yeah, I agree.

That definitely applies in our world as well.

It's kind of a universal truth.

It really is. It applies in everything. Hiring people.

Yeah, everything.

Right. Marrying people. I don't know how you put that. But anyway, there are some things that are beyond our expertise.

That's right. That's right. You never know until you know.

So I was sharing earlier in the blog that my personal experience as an investor is owning rentals and then flipping properties, like buying and then flipping retail flips and making a little money on the flip. So my head immediately went there. Kind of small, small crew, small contingent of like, you know, kind of partners. I was using a couple little contractors here and There. But I was kind of like the GM on all those deals, so it was all really close. You know, for me, the big risks that I learned from was, you know, buying without a clear exit strategy and, like, figuring out as you go.

Right.

That was a bonehead move. I once bought a property at an auction and went above my minimum. I mean, why do you even do the homework? You know what I mean? Why do you even do the homework if you're just gonna throw it away because you get excited in a moment.

That's right.

Stupid, stupid. You know what I mean?

Yes. But so common. It's very. I'm glad you're sharing it.

So I did it once, and then I realized, oh, that math did work. Right. I. And never did it again. Probably did a lot less. Found a lot less value in that deal than I would have if I'd have just waited for the next one to add up.

Sure. There's always going to be another opportunity, right? It's okay to say no.

Yeah, man. That's a. I think especially in a market like this when it's so tight, like, I gotta do something. No, you don't.

Yeah, correct.

If it's a bad move, it's a bad move. It doesn't matter how tight the market is.

Exactly. Right.

Math should still add up. Plus two is still four, right?

Yes.

So anyway, I think in a market like this, it can get really tempting to just take whatever you can get and hope that it's going to keep inflating or something. But, I mean, none of us have a crystal ball.

No.

Right. So, no, we don't do your proforma, your metrics, or your goals. So back to my initial, initial thought. There was plan before you purchase, right?

Yes. Yeah.

Plan first, then purchase.

That's right. And stick to the plan.

Yeah, exactly.

And don't get emotional or excited and be like, I'm gonna do it anyway.

That's what you pointed out. Don't get emotional.

Yeah.

That's so key. Because the. It's really easy to do. When I was doing retail flips, every house that I did, I wanted to move into.

Okay.

They were all newer than mine. You know what I mean? Like, they all had fresher renovations than my home.

Okay. Yeah.

So I'm like, oh, I want these countertops, you know, so there's a sentimental attachment that happens as you're decking out of place and you're styling it the way you like. I mean, I'm trying to make a general appeal to the market or whatever, but there's also like a, you know, kind of a personal interest that goes into it. So it was always tempting.

Yeah.

To think too sentimentally, like, wouldn't it be cool if.

No, that's.

That's 15 grand over budget and you're not going to get that back.

That's right. Yeah.

I want an island here, though. What about a master club? You know, So I got tempted with those a few times.

That ties into one that's on my list and that's having bad comps and not really knowing how to evaluate the market. Right. That goes. That strings into the rehab. Because if all of your comps are in the 180, 200 range and they have Formica countertops, not granite countertops, and you're spending the extra to put in granite for no reason because you're not going to get the value in the end, you're ultimately squeezing your profit margin. Then so many other things can just stumble and snowball and, you know, the market could be dipping. It could get slower. Long, longer days on market, higher holding costs. All of those things, you know, on top, stacked on top of each other.

Yeah.

You know, sometimes you end up breaking even in. That's not any fun.

I have a good friend who's a building architect.

Yeah.

And he said sometimes you have to shoot the artist. Right.

So that's good.

If the artist in you is the one that's like. But wouldn't it look great with da da da da.

Yes.

Shoot the artist. Because you have to do the math. And it's based on the comps. And that's the point you're making. You can't just design away. Because I want to be the Property Brothers or whatever.

That's right.

Unless there's a camera crew following you, you might have different limits.

Yes.

So in the. What happens in. Okay, so educate me a little bit on the multifamily stuff you get into. Comps are harder.

Yes.

It's. It's way more nuanced.

Oh, my gosh. Yes.

So what kind of risks. And do you have any deadly stories around that or have. Does that run into.

Fortunately, I don't have a deadly story. We haven't experienced anything bad. But it is. You have to take more care. Right. There's a reason why I join as many masterminds as I do, and it's because I don't want to make the mistake myself. I actually want to learn from everybody.

And so I was told you're still learning from mistakes.

Oh, yes.

It's just somebody else's yes.

And it's not like the big ones too. Right. And so when it comes to comps, you're really looking at cap rates. You know, you're not looking at the apples to apples single family. This One sold for 160. You're looking at what's the condition of this and what were their income and expenses and what did it sell at for that cap rate. And so you really have to go to the brokers in that market that have all this active activity and know the language, what's the going in cap rate as opposed to an exit cap rate. Because if you don't even understand that much, you're already going to make a bad buying decision. So that's just. That's one of the things that could kill you in multifamily. And right now a lot of the multifamily investors are going into mobile home parks, storage, other things, because there's some crazy money buying stuff at crazy prices right now. And that's happening in turnkey world, isn't it? Too Right. Single family stuff. So I think there's deadly mistakes happening all over the place right now because people aren't knowledgeable what they're doing. They're just grabbing what they can.

Yeah. So like, you know, like the sheriff's auctions are a good example. I used to buy, you know, a couple of years ago I would buy property at a sheriff's auction. You go there, it's all bid up to retail.

Yeah.

They're all bad buys, right?

Yeah.

There's so many bad buys because you're individual guy kind of shooting from the hip and, and just responding to what's going on in the market as opposed to doing a thorough analysis, planning and exit strategy, you know, forecasting your renovation cost then buying.

Yes. Right.

So yeah, that's definitely happened in the single family world as well. Not preparing before the purchase is a big risk. I think that's a deadly mistake.

Yeah. And I think for in the multifamily world, that applies to that due diligence piece. And I was talking to Della the other day because we're doing due diligence on the 48 unit that we're getting ready to buy. And she said, what does this mean? Why should I be doing this? And I said, well, okay, so if the seller says, here's my capex improvements over the last two years that I've owned it, and they said they replaced 20H vacs or 15 water heaters, or when you're walking the property, you want to verify that actually what they said was true. And sometimes it's not even you want.

To see those windows or that because.

You based your underwriting numbers on that information. Right. And so. And sometimes it's not intentional on the seller's part to misrepresent something.

They got ripped off.

You nailed it. So that's a very deadly mistake when you're playing in big, big numbers.

Whether they're honest or not does not affect the value of your deal. Whether the furnace is there or not is what affects the value of your deal.

Yes, good point. Yeah, exactly right. So I would say that's a very big one. And like, we went through a big long. She was like, you do all of this and I deal. I said, you better do all of it in a deal, because if you miss one of these steps, it could mean a big mistake down the road. Big mistake for us and all the people that we bring on board.

Yeah. Another risk that comes to mind, I think a. A deadly mistake that people make when they get into single family homes or little duplex investments or whatever.

Yeah.

Is not having a little bit of a cash set aside or some kind of budget for unexpected things.

Yep.

This tenant turns out to be horrible and destroys your place, and then now you're down a few thousand bucks and a couple, you know, months rent or whatever to turn it over. Right. I mean, those kind of things can happen no matter how much you vet or how well you renovate the property. At some point in the life of it. You own that thing for 20, 30 years, at some point you're going to have a bad experience.

Yes.

Hopefully it's well after you've cash flowed a ton and you're on top of the world and some blip 20 years down the road.

Yeah.

It could happen month, too. Yeah, it's unlikely, but it could happen month too. Right, sure. So having a little bit of cash set aside and being prepared to weather the little storms that hit is smart? The storms will hit.

Yes.

Hopefully they're not devastating. Right. You have insurance for the devastating things. You don't have to have that cash set aside. But yeah, little things. A little furnace, whatever. You know, a literal storm hits and rips the roof off, whatever.

Yeah.

So I think some. Sometimes people make that mistake. They think, oh, I renovated the property, I put a tenant in, so it's all nice and new. I won't need to touch it.

Zero expenses.

Probably not, you know.

Yeah.

That should stand a reason a little bit.

Yeah.

You always have to have a little bit set aside for unexpected things.

I was just on a call right before. We're sitting here recording this, and they said that exact same thing. They said, I've looked at underwriting sheets and I've seen $0 in the expense column for, for three years. And they did it because they said, well, we, we renovated everything. That doesn't matter. You better have that reserve and that cash set aside.

You don't know what.

You don't exactly.

Every problem, every real estate investment is a risk. You're buying a hard piece of stuff.

Yes. Yes.

Right. Like there's a physical, actual thing there.

Yes.

And unless you tear it down to the literal. Like I walked a property recently that had, it had a foundation issue. Beautiful home. I mean, it's, it's an A class property for sure. Beautiful home and one of the nicest neighborhoods in our region here. And it was custom built like maybe six, eight years ago. And they more or less built it on quicksand. So for some reason, when it was graded.

Yeah.

The adjacent properties that were built by the same builder, somebody looked at the wrong checklist or whatever and got the soil sample or whatever and there was a bunch of trees or rocks or something buried there. And it was not builder grade. No soil.

Oh, my goodness.

The wrong terms.

But you know what I'm talking about. Right.

So that house, it sunk like three inches in the backside of the house and it was all broken up and fall and who knows what it would cost to fix that thing.

Wow. Yeah.

You can't know that stuff until it happens. Like, you know.

Yeah. Truth.

It should happen very, very, very infrequently. Right. That's a, A weird little strange, you know, perfect storm of events that happen to them and I'm sure cost that builder and that homeowner and everything. All kinds of headache.

Yeah.

And. But anyway, that's a devastating end and not having something set aside for whether it's your legal battle or your.

Yes.

Construction remedy or whatever you get into.

Yep.

A piece of property always comes with a little bit of risk and you should, you should have a little bit of an egg set aside to, to deal with it.

Yes.

Right.

Yeah, absolutely. And I, I fear that many new investors don't even understand that piece of the puzzle. Yeah. And hopefully they listen to something like this and they go, oh, yeah, okay.

Expectations are, maybe I should set ten grand aside.

Exactly.

I'm gonna have a couple of properties and just know that there's going to be unexpected expenses.

Yes. And that's, that's part of the gig. You know, it is It's a big reward, so why not actually take all the precaution right up front?

Yeah. What you really don't want to do is give up something that can return you 15 plus percent a year or whatever because you can't afford that $8,000.

Surprise, man, you nail it. And I've heard stories like that so many times, so I'm glad you said that.

Yeah. Every once in a while I see somebody who's like, ah, I can't believe this happened. I'm gonna sell the place. Well, not before you fix it.

Mm.

And then you're going to be selling an even better property.

Yes.

That now is even less risky.

Yep.

To somebody else to enjoy that delicious cash return every month. You know what I mean?

Yes.

So just be prepared for those downsides. Don't freak out and panic. You don't do that with your stocks. Why would you do that with your real estate?

Yeah, exactly. Right. Yeah.

Be prepared for it. That's a big one. What else?

What other deadly mistakes I put. Don't put all your eggs in one basket. And that could be geographic location, it could be investment type, it could be size of asset. I think that there's just danger in doing anything, like just all at once. It's why we built out. It's one of the reasons why we build out this many companies. Right? Yeah. Because as the market shifts, we can do so many different things.

Yeah.

Well, same thing is if you're investing this really great area, but there's one major employer and that employer goes down now, what happens to your rental property? Right. Yeah. So there's so many different types of risks between, you know, who you're investing with and what type of investment you're getting. The geographical area, and if people don't understand all of that and the different ways you can diversify, it's wide. Diversification is talked about all the time.

Types of investment is a cool way to diversify too.

Yeah.

So we, we provide several different types of real estate investment opportunities. So there's. And there's even more. But you don't have to do only rentals, Right. You can do some rentals and you can also be a private money lender.

Yes.

And you can also do. Get into some syndications where you're more hands off. But you know, there's somebody else managing the day to day of the operation. So. Yeah, it's cool to be able to kind of dip your toe into multiple pools and not have to worry about one of them, you know, any one of them ruining You.

Yes, exactly. And there's benefit to that, too. James sent us an email. You were copied on it. I don't know how much of it you read, but he was talking about the benefit of investors between a debt piece and an equity piece, and one of them giving tax benefits. And those tax benefits being able to pay on the debt piece that didn't have the tax benefits because it was ordinary income. Right.

Yeah.

So as you diversify, there's some things going to allow you to help you offset, you know, the ones that aren't giving you the tax benefit. So there's so many pieces to that puzzle.

That's. That's a good point. And most real estate investors are. Are not exclusively real estate investors. Professional.

Yes.

Like a lot of real estate professionals or real estate investors, rather, are tradesmen or professionals of other sorts making their, you know, their career is doing something else.

Yes.

And that can, you know, weave and change and turn and whatever in ways that affect your tax situation or your savings or whatever. Yes, in different ways. So having your. Your hand in different types of investments gives you. Makes it easier for you to kind of size down or up things that fit your. Your financial situation.

Yes, absolutely.

Yeah. You never know when your pay is going to get cut big at the job or you're going to want to start a business or whatever else. And a lot of different interests come into play when you're making moves like that in your. Your nine to five.

Yeah.

Your day job or whatever.

Right, exactly. Right. Yeah. Another one that I was just thinking as we were talking was the two money skills. Right. You have the ability to make money. That's a skill. Right. And then your ability to keep your money is yet another skill. And I don't know how many times I've been taught by people I look up to and surround myself with because they're where I want to be. And they're saying that keep the money is one of the hardest things to do.

Yeah.

So knowing how I've been in that trap. Okay.

When I've had a ton of money.

Yeah.

Oh, it never stops coming. That's not true. Exactly.

Right.

You still have to grind to get it. That doesn't change. So, like. Yeah.

Yes. Yeah.

Keeping it part is a key skill. That's. That's a big maturing moment.

Yes. Yeah. It was for. I've always heard it. Heard it, heard it. And now we get into the multifamily syndication space and we're really talking to people with a lot of money, and they're saying, I Don't want cash flow. You know, one of my deadly mistakes has been losing money because I kept on risking too much.

Right.

And I needed these smaller sticks, safer buckets. Real estate happens to be one of those. It's not the big swings. The real estate can be called boring. You know, it's. It, it. The swings are going to happen over time and you can usually mitigate.

You know what's really boring is losing half your net worth in a speculative investment that you can't afford.

Yeah, that's very boring. Yes, exactly. Right.

I mean, everybody's got a different kind of tolerance. That's a good point. When you're sitting on a pretty good chunk of money that, you know, provide you the lifestyle you want, protecting it is far more important than speculating to get your next boat or whatever. Right. So for that investor, that makes a lot of sense.

Yeah. And there's ways to like, divide up. We flip. And I always talk about something we learned from Dan Fleshman. I don't know if you're familiar with that name, but like, boy, he is. He's successful.

Yeah.

I've seen some of his 40, 40, 20. That's what he talks about. And he's got his safe active income kind of falls in 40% and then another 40% is like his medium risk investments. And he calls that real estate. He dumps a lot of money into real estate. And then 20% is just what he calls shot for glory. That's where he gets speculative and that's. And then it doesn't matter that you're burning 20%. Yeah.

You're kind of expecting 80%.

Yeah, exactly. So I, I think I've heard people say how much that they've lost so many times that I thought that's really like a formula that makes sense.

I had a ton of money once and put, put more than 20%. Oops, that's dumb.

I'm sorry.

It happens.

Yeah.

I wouldn't trade it, to be honest.

Yeah.

I mean, I'm still relatively young and it was a great lesson learned along with others throughout my career.

Sure.

I wouldn't trade it.

Yeah. And it's funny because we're calling this like deadly. Right. Because it's a marketing term. Right.

But yeah, we're being dramatic.

Yeah, we are, but they are. The lessons learned in them are so valuable because you're not going to make that mistake again. And hopefully some of these you don't make at all because.

That's right.

You know, learn from somebody else about the mistakes we made.

Wise man learns from his mistakes and even wiser woman learns from somebody else's. Right.

Nice play on gender.

It was like International Women's Day recently. I failed to make a social media.

Post about it, so there's no problem. Good job, Aaron.

What else? Any other big, deadly risks that come to mind? Setting money aside thing was a big deal for me. Not having an exit plan in advance was a deadly mistake that I see a lot of you mentioned. Betting partners, I think was the big one. Yeah, that's a big deal.

Yeah.

What other deadly mistakes come to mind?

I think about the economy and I think about the market. You know, we could talk about it today, even right now, all the changes and everything that's, you know, impacting what we're seeing, from the pandemic to inflation to supply chain, labor shortage, all those things impact what's happening. And do you know how that's going to affect real estate or the future of any business that you're working with? And if you don't study it, and I'm not big on. I'm not even the person to talk to about this type of stuff, but I certainly read the articles from the people that do so that I have enough knowledge so that I know where I'm going. And I think that depending on what you're doing, you could make a deadly mistake by entering into a market that you weren't prepared for. And we've certainly heard enough of those stories.

You're right. In response to that.

Okay.

You know what I think is even deadlier? What I always think of this Warren Buffett quote. He said. I don't remember the quote exactly, but he said, if, you know, you want to be in a game, trying to figure out the timing of getting into the game is the worst mistake you can make.

If you.

If you know that you want to own real estate.

Yep.

Trying to figure out to buy it yesterday, today, or tomorrow is a mistake.

Yeah.

Because what you know is if you know, you want to own it in your portfolio 10 years from now, the time to buy it is now.

Yeah.

Because you have no idea what's going to happen tomorrow for the next day. And I've read even, like point in time right now with inflation and interest rates and whatever. I've read conflicting expert opinions.

Sure. Yep.

And a bunch of them are going to be wrong. A bunch of people that are way More like, yes, PhD economists than us or whatever, it's going to be wrong. But you know what's probably not going to be wrong is that real estate is Going to be worth more a decade. Any given piece of real estate is going to be, I mean that the dirt, they call it real for a reason. If you want to be in the game, today's the day.

Yeah.

So I think my personal response to how you read the tea leaves is that trying to time the market is a deadly mistake.

Yes, I agree with that.

If you can't afford a given risk, given the volatility that it produces any given year.

Yes.

Then sure, wait. But you know, trying to time it because I think it's going to go up. You don't know that.

That's right. Yeah.

50% of the time you'll be wrong. 50% of the time you'll be right. So why, why play that game?

Yes, exactly. And that's why a lot of us are doing long term plays. Even the multifamily stuff. You know, you can do a five to seven strategy and you can do a long term. I'm just like, let's just do long term. Who knows what's going to happen in the next five, seven years. I'm watching it, I'm listening, I'm paying attention so that I can shift exit strategies if I need to on something. We need to exit. But this big stuff, let's just keep it. Yeah, why not?

Yeah, agreed. There's some time bound stuff. If you're flipping a property and you know, you could be selling two months instead of, you know, right now you're buying it and two, three months from now you're selling it. What happens to interest rates if they, you know, between now and then could have an effect?

Yeah.

Even then you should be diversifying your risk in different ways. If the volatility of a given thing over a given period of time isn't right for you. Get into something that's safer.

Yes. Yeah.

Like buy a trust or buy, get into syndication or whatever else. Something that dilutes that risk.

I love that wisdom. Yeah, Aaron, you're right. I did.

Like that's the old stockbroker coming out of me.

I love it.

It's all about buying the time frames with the volatility. Anyway.

Yeah.

Anyway, I think that's a big one.

Yeah, I think it's huge.

Trying to wait until it's the right time or whatever.

Yeah. Of all the things we've talked about that, that one's my favorite. I think you hit the nail on the head.

Oh, happy St. Patty's Day everybody. Oh, yeah.

I'm not wearing green, but Aaron, thanks for representing Today is the day.

Well, I hope you all get lucky with your investments. But even better than that, I hope you avoid some of these deadly risks in real estate investment because there's so many dumb things that have been done. If I were a new investor, that's what I would be researching.

Yeah.

What dumb things have been done? And I want to hear those stories. I don't want to hear somebody's pro forma where they're cash on cash forecast or whatever else.

Right.

If I were a new real estate investor or getting into a new lane.

Yep.

You know, like I'm getting into syndication for the first time. I think I would be wanting to read and listen all about how those things go south.

100%. Yeah.

Interesting topic to me.

Yeah.

Anything else? What do we miss?

I'm sure we missed a ton.

I mean, we could spend all day.

Yeah, we could spend all day. Let me see. We talked about it. We talked about it. Oh, well, I, I put short term versus long term business mentality because I was thinking with my business hat on and how, you know, you are treated or how you conduct business or how you just. Your character and values. You know, there's a lot that can play into that particular conversation. Where my brain went was how many times I've talked to people and they said I was burned by X, I was burned by X. And I just thought, why would the person that you were working with not just do the right thing or do what they said that they were going to do in the first place? Because that's just. They just burned bridges and.

Yeah. That's a super dead risk.

Yeah.

So grabbing a transaction. Oh, no, no. This says this. I'm taking that.

Yeah.

And ruining relationships with ballers, that could be making your life. Right.

Exactly.

Why would you want to ruin partnerships?

Yes.

You know, by exploiting some leverage or whatever and grabbing a short term gain.

That's right.

Or gain or whatever.

Especially after the work. You just put in the work. Right. You just built it. You got that trust and that takes time. And then you ruin it. And then you don't. You're not able. I, I've never really understood that that.

Even boils down to small stuff. Like your contractor runs into a problem that wasn't foreseen.

Oh yeah.

And they're like, man, I know I bid this, but I could not have reasonably expected anything like this to. This is completely on. Well, the contract says that, you know, you, you make this guy lose 15 grand.

Yes.

What's the chance he's going to do a great job for you? Again.

Right.

You're more or less say, I'm buying myself out of using that contractor again because I'm going to screw. Like partnerships go two ways.

It does.

So that's a really. That's a really big one. I think the deadly mistake you can make in real estate investing is letting your partner suffer disproportionately when unexpected storms hit.

Yes.

Right.

Yeah. 100%.

Grabbing the short term game or protecting yourself first and not thinking about those who came along with you and own some risk with you. That's a. That's a great one.

Yeah.

That applies in so many other places, you know, so many other places.

Yeah. From business to rehab to everything. Everything that we do.

Yeah.

It's finding the character of the people that you're working with and the grit.

Yeah.

Which is what I alluded to in operator conversation. Yeah, please. I just. I want to see that you hit tough times and you found your way through it and that, you know, what.

Do you do when the world's crumbling around you? Act like a jerk and stab everybody and run away.

Right, Exactly. Right. Yeah.

Great call. I'm glad we stopped to add that.

Yeah.

Okay, cool. Let's call it a wrap.

Okay. Let's do it.

Thank you, Freedom fans, for watching. And as always, invest smart, live happy. All right, bye, y'.

All.

Happy St Patty's Day. Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax, legal, real estate, financial, or business professional for individualized advice. Opinions and information on this show are not guaranteed. All investment strategies have the potential for profit or loss.