7 figure section 8 strategy - Live Multifamily Strategy

All right, and here we go. Welcome to another episode of Multifamily Strategy Live. This is the normal Wednesday broadcast. Last Wednesday at 3 o'clock, I was on a plane. There was no physical way to go live. However, made up for it with a couple of bonus lives both over the weekend and then late last night, and we are ready to rock for today. As usual, go ahead and post questions in the comments. We typically go till the questions stop, or I am just completely out of steam, which takes me a while. Today we have a topic that we're going to start out with, and then we're going to open it up for the questions both on Instagram, YouTube— well, I guess not more than both, it's Instagram, YouTube, X, LinkedIn, and Facebook. Wherever you are watching, go ahead and post your questions in the comments and I will see them here on my screen below. So there's a strategy that Cody and I went over. I just launched a YouTube video on this. I just added a section to the course on multifamilystrategy.com on this. We're going to give you the rundown here on the Section 8 strategy, 7-figure strategy, Section 8. We've actually made $1 million on this strategy. There's a point in our portfolio We talk about maintaining cash flow. The reason we did this, we built our cash flow, we got exactly where we want the portfolio. We did it in 11 months, retired my wife from teaching, and the portfolio started negative cash flowing, $21,000 a month. We picked up too many projects. The government support ended for all the COVID stuff, and we had too many units to renovate for the size team we had. We started hitting a vacancy problem. We used Section 8 to solve this. Anyone can do this in almost any market. I'm going to give you a few tips. Tricks on exactly how we pull this off. Before we get launched though, there's an event coming up that I really want to see everyone at. For everyone who joins these lives or watches them afterwards, we are hosting our biggest event yet. No, it's not the Robin Hood Village Resort. This is right on the river between Vancouver, Washington, Portland, Oregon, right on the water. 250 people. It's the Northwest Action Summit, nwactionsummit.com. Check that out. Be there. Tickets went for, uh, the website went up last week, so tickets are been on sale for about 8 days. We are over halfway full. They're selling out super fast. This event will be full early, so make it as soon as possible. If you want the, uh, there's a VIP dinner. I think there's one seat left there, but this is going to be a fantastic event. We got some great guest speakers, a really heavy concentration of West Coast people. We got Dion McNeely, Mike Newton known as Millennial Mike. Those two have spoken a lot of my events. Michael Zuber out of Fresno, California, fantastic investor. Actually learned a lot about how to specify our buy box from him. But that event is going to be May 3rd and 4th. Stay in a fantastic hotel, huge venue, tons of networking. We're talking creative finance, real estate masterclass management. Mindset. They're going over the whole thing, but I love our lineup. Absolutely attend that. Cody and I are co-hosting. We were speakers last year, uh, we're hosts this year. I'm very excited for this. Want to see you there. Section 8 strategy, let's talk. So for those who don't know, Section 8 is the housing authority. It is subsidized housing. Essentially, there's a voucher program where someone who is low income can apply for a housing voucher, and they award X amount through the year, take takes some time to process, but they have to get placed in a Section 8, Section 8 qualified, um, rental. You have to opt to work with them, so they can't just place anyone anywhere. And there's a maximum price that they will rent at, but it's usually slightly above market rent for entry-level housing, so that usually works out really well. You typically actually get paid a small premium in most markets for working with Section 8 housing. Now, how Cody and I use this to fix our portfolio is we actually walked into the housing authority and just asked, what, what do your programs look like if we want to help you fight homelessness? What does it look like? They gave us a little handbook and they said, well, first and foremost, every unit needs to be qualified and there's renovation standards that need to be met. And it's having GFCI outlets in the right spot, the right exterior lights, right smoke alarms, carbon monoxide detectors, basic, some basic maintenance items, some kind of arbitrary ones. But it's making sure that your plumbing, electric unit is all up to par for their housing program. What we loved about this is we took a handbook that they handed us and we actually have used that as our renovation guideline for every single unit in our portfolio. Cody and I started with really no significant renovation experience. That guidebook has made it so all of our units look the same. They always pass that rental program, which means they pass pretty much every other rental program standards. We pass everything for bank finances because everything is up to par, good to go, checked off, and ready to rock for Section 8. Now they also give you their actual pricing, so they're called Section 8 maximums. It's how much they'll pay for a studio, a one bed, a two bed, and so on. Now what's fun with these is they're actually based off of data. I used to work for CoStar and I had every single housing authority in my book of business. The way that they do this is it's based on the average rent increases over the prior 2 years, which means you actually have a crystal ball on exactly what rents are going to do with Section 8, because you can look at what happened the last 2 years. It'll tell you what's happening now. So when we hit 2020 and 2022 and 2023, we saw huge rent spikes at the middle and later parts of the COVID shenanigans. Well, we knew that rent was going to spike and that'd be reflected in the 2-year data, which means Right now we're starting to see consistent rent increases. 2023 rent for a studio was, I think it was $785. I just did a YouTube video on this. If you haven't seen it, you can watch the whole video. It's 8 minutes. It was almost $100 more. I think it was like $92 more for studios in 2024. $100 rent bumps on a couple hundred units. Is a lot of cash flow. In a 6-cap market, you take that new monthly income, 100 units times 100, multiply by 12, and then divide by 0.06. That's the new net worth that you've just created through a Section 8 pricing strategy of just matching what they do. What's fun is you can still get market rate people, so you can list it with their renovation standards, with their pricing standards for entry-level housing, You know you're staying affordable because you're matching the housing authority. And if you can profitably run your rentals there, you know what's going to happen in the future with your rents. And housing authority will generally auto-approve anything up to that maximum. In my market, because they really need the assistance, 6 months in, you can even do a small rent bump above their maximum and they will allow it. That strategy took us from negative $21,000 a month from all of our vacancies to a fully renovated portfolio that is more or less fully occupied at all times. Now we have some hotel conversions that we're doing right now that are obviously not fully occupied because we're in the middle of converting them. Outside of that though, this is the strategy that worked. It was very, very simple. Uh, the step for step on how you're going to apply this and the questions you're going to ask with the housing authority, as well as how to use this, uh, to actually pitch for capital with investors— that whole presentation is packaged in the Multifamily Strategy Course. And there's a mini video of it on YouTube, last video that we launched, uh, on our Section 8 strategy. All right, let's go dive into some questions because it is that time. I apologize, we're getting a little bit of allergies here, so if I sound stuffed up, it's because I am. CJS, uh, what's the minimum population you look for when investing in a city/town? Mine's around 16K with 2.3% growth every year. I want to see positive population growth. I'm not as picky, um, so it could be 2.5% growth, it could be 1.5% growth. Um, I do like towns that are north of 15,000, so I'm actually pretty close to a lot of your metrics. But, um, 15,000 population— a lot of the places I invest have 30,000 to 40,000 people populations for the city, and I invest in areas up to 100,000 person population. I like smaller towns because of your ability to operate and really take over and have some control over market rent, you just really realistically would have a lot of trouble going into like a Seattle or Los Angeles and notably affecting the market price, which is something that's really critical to my strategy because what I'm doing— forced appreciation and value-add— I really want to be able to push that and have the power to do so. Dylan, hey, I'm looking at an area 30 minutes, uh, from top 5 MSA. 4,600-person population, 19% population growth. Is that per year? That sounds like a ridiculous amount over the time of— let's see, your 2K population at COVID, too small. Well, I guess if you're only 4,600-person, 20% population growth isn't even that much. Too small a county has $700K within an hour of all directions. That sounds like a decent area if there's a lot of population all the way around it. If it's that small, I want to know that there's a lot of building going on there. If there's a bunch of new construction or new jobs moving in, I'm now very interested in that small little market. Luke does bring up a good point. We can't start without All Nighter Hider. I have not seen him yet, um, but, uh, All Nighter, if you're here, let us know. Sorry about that. I moved my, moved my questions around. There we are. Um, when will the course see the Section 8 section? Will it be its own section? So I released that late last night. I made sure that is active and available. So if you have the Multifamily Strategy Course, you log into Mighty Networks, which is our hosting platform. It should be near the bottom, I believe, but the Section 8 course is 6 sections, and I go over what it is, how the voucher programs are put together, what questions you need to ask your housing authority, what the unit renovations need to look, feel like, and actually be to qualify, how to network and get a copy of that handbook, because that's really important.. And, um, what else is in there? There's a few other things. Renovation tips, um, how we utilize the pricing guide, uh, tips and tricks to keep track of things. It's a, it's a short segment, but I think it's really powerful. I put them together. It's 6 videos, each one's about 4 minutes long, uh, but it's absolute gold. If you guys have the course already, dive in there. I'm really proud of that. In addition, I just re-recorded the entire owner scripting section. We first did that 2 years ago when we got our first 100 units. We've done a lot since then, and so I have refined that. It's now filmed in Ultra HD with better recording and more importantly, even more content. I go over— added a new section for how to make the phone call to the owner, how to book the first meeting, and then we went step by step. Here's everything that happens in a successful owner meeting. From best tips for small talk to integrating your circle drills to— I— we, we go all the way through it step by step. It is a, I believe, 15-video section. Um, just completely revamped it and love it. So for those who have the course, dive on in. Those are both live now. Dylan, I've talked to a few people about homeownership. Uh, some people say Uh, higher is better because less crime and competition, and people who can't afford houses want to live in nicer areas. Others say lower better. That was a little hard to read. What I think this is saying is nicer areas are better to invest in than entry-level housing, which I actually do have a thing on, if that is in fact the, uh, the question here. In nicer areas, you're going to have an easier time managing it, and it usually comes with less upside. You're usually going to cash flow less, you have less work. It makes sense. Pride of ownership is a big thing. They're much easier to run. There are a lot more expenses with a rougher population. There's also a lot more money to be made there. Most people, if you're starting without money, are going to do projects that are a little bit— they have a little hair on them. They're going to be— there's something wrong with the property where someone wants to sell it because they don't want the headache. When you start out, you can build a lot of money buying those type of properties, fixing them up, managing better than the last person. At some point when you want to be more passive, you accept a little lower return and you 1031 them all into more passive assets in a more upscale area. That is a very common thing to do. A lot of my mentors have done exactly that. At some point I don't want to be doing the rough and tumble projects. I don't want to be, uh, working, you know. I have a few buildings back when I owned in Seattle before Cody and I sold our 7-plex. We had a constant squatter problem because people would just— they wouldn't even just pick our locks, they would drill the lock out, put a new lock of their own in, and just move into our units. And it happened all the time. There comes a point where you don't want to deal with that. You'll take a lower return to not have to deal with that headache. When you're starting out, it happens a little bit less, uh, less than you think. They're buying the nice stuff. Let's see here from Mason. Have you started buying in Weatherford? Just curious, as you said you've already bought in Texas. I have not bought in Weatherford yet, but there's a market I'm looking really close at. There's a bunch of markets in Texas, by the way, that have that same graph. I used this as an example in a recent, uh, recent call. There's a bunch of cities though in Texas where the growth is just exponential. It's— I absolutely love investing in Texas. I, I've said something, and I think it's still true, but I've said something a lot that I'm starting to second-guess. So I talk a lot about how I would buy in, uh, I'd buy in markets where you can like have less competition. So blue state, never heard of a Texan trying to buy in Washington, but lots of Washingtonians try to buy in Texas. So I found I can do a lot of deals here with less competition. As I've started to enter the Texas market and look at other markets, I found I'm finding deals just as easy, except they're easier to manage after I close them, and the deals are just as good elsewhere. I would not be surprised if I take my 200-unit portfolio in Washington and it becomes a higher-class 100-unit portfolio in Texas. I am looking at a few deals and I will be expanding in Texas pretty aggressively. As I leave Washington, I lose the magical advantage of I live near enough to the properties to manage them. I'll probably make some changes to my portfolio and I'll pay down a lot of debt and I'll have less debt on less units cash flowing more. And that is something that I'm actively looking at doing. And I am pulling up a, a graph here for us for another city so everyone can see what it looks like. When we have a market that I really like. That being said, we'll see if it wants to pull up. There we go. I was just looking at this one recently. So here's a border town, a little higher population. Uh, this is near McAllen, and I do own on the border, so I own in McAllen, Laredo. I'm gonna do a quick screen share here. And show you guys exactly what I'm looking at. Boom. This is what I mean by growing population. This fits the metric of, uh, 2.8% growth. I mean, that's a lot of growth since 2020, but look at this graph. Consistently, always going up. Flattened out a little bit here in '18. Other than that, that is an area that I'm going to assume people want to live in and will continue to live in. Now, it's near the border, so we do have, uh, we do have some immigration issues that are probably contributing to rapid population growth. But this is something in an area— there's like, there's an area of Texas where it's just fantastic. I see graphs like this I know without a doubt we are not building fast enough to keep up with this inventory, especially not with rates recently adjusting. When rates went up, building slowed down. Population growth in areas like this did not. This is a good area of— or a good example of an area where I see this graph in a market and I'm like, hmm, is this the place I want to invest? Next step would be actually visiting it and see if it seems like somewhere where humans want to live. Do you look for a certain profit per door? No, per door profit is not relevant. Uh, if I'm looking for anything, it's cash on cash return. But more than that, I'm just looking for deals that pay me a high percentage of the mortgage. The debt service coverage ratio is an excellent cash flow metric. If I'm cash flowing 1.5 or more debt service coverage I'm making a lot more money than my cost, and on long-term fixed rate debt, I'm going to cash flow very well. Per door only really matters if you have a tiny portfolio and you're trying to optimize every little piece of a duplex or a fourplex. As you get a larger portfolio, per door changes by market massively. There's some markets where you expect a ton of— like, just a ton of cash flow per unit owned. Um, but even per door, like, a two-bed is going to cash flow different than a one-bed, which is going to cash flow different than the studio, which, like it looks different. So per door's not really a great metric. It was made popular early on by BiggerPockets. That was one of Brandon Turner's big metrics and kind of got adopted. But per door is really subjective to market and not the best way to look at your portfolio. You just really want to see, is your money making money? When we use our calculators, we look at cash-on-cash return, DSCR, and, um, I mean, those are really the main two. You'll use cap rate a little bit, but not, not a ton. There, there is a use for it, especially when you're exiting the debt. You know roughly what your property is going to be worth. Uh, the only other piece of math that we use consistently is called a loan factor rate, which is how we determine exactly how much interest we can borrow on any deal. With those four things, we're pretty much good to go. Cap rate, loan factor rate, DSCR, cash on cash return— those are the metrics that matter, and they're the only ones that How do you log hours to be a real estate professional? I did not do this correctly my first year, but you track the hours that you work for every property. You keep a little journal, and in that journal it just says, hey, I was here at this property, this is what I did, and these are the hours that I worked. It's kind of like punching a time card for a job. Now it does get hard when you have a large portfolio because you're supposed to do it per property. I don't think anyone's doing that. Like, think of any large, large real estate investor. I doubt that Donald Trump is punching a time card saying like, oh yeah, I know I was here and then I was here and I worked this long in Mar-a-Lago. I don't think that's happening. Um, that being said, uh, you are supposed to track your hours as a real estate professional. For me, it's a little easier because I own a property management company. I'm on the clock and I actually have clocked hours, um, as an S corp. You can see when I am working. Property management does actually count. Then I spend all the time on the properties. It's also easy for me to go back if I forget a day, because if you haven't noticed, I'm on Instagram @ChristianOsgood. I have video footage almost every single time I'm out in the field. I can go back, timestamp everything, look at my posts, and I can put it together. But the best practice, just keep a journal and log your hours like a normal employee. Just have it in, be like, oh, I worked this long today. Sign off, good to go. What are the best ways to build relationships with owners if you don't live in the market that you're targeting? So you're gonna call, you're gonna have more phone calls, and then if you have a specific market that you're targeting, at some point you do need to be in that market. Like, you're going to do walkthroughs of units, you're— you want to see the town, you want to get a feel for it. Just book all the owner meetings when you do a trip to that location. That's the easiest way to do it. Stack up 5 of them, choose a time you're flying down there, and that's an easy call to make. Hey, spoke before, I'm finally flying into town. I'm gonna be in here for— I'm gonna be there for 3 days. Do you have time for coffee on this day? It's a super easy meeting. People are usually flattered that you're flying there and willing to meet them. Like, super important to me that I meet you. I'm actually flying in. Can I get you coffee while I'm in town? Totally normal thing to ask. I get a yes on that all the time. CGS excited for new sections. The course, um, I'm, I'm doing a lot of updates to it. I've been having a lot of time, a lot of fun filming. I'm spending a lot more time in front of the camera. And so as we're putting these out, um, I'm getting a whole bunch of sections in. Originally we wanted the core multifamily strategy. The goal is anyone can take this and go from 0 to 100 units. And we have a few people are getting really close. Uh, really soon here I'm going to be interviewing someone named Logan who's who's actually at 78 units, one of our early mentees following the things. He's like a year and a half in. You can totally do the 100-unit thing in a very short period of time taking the course. What I'm starting to add consistently is going to be the tertiary things. Anything that made us a million dollars or saved us a million dollars is going to get a section. So I'm going to talk about what to buy and what not to buy, um, when to focus on a buy box and when to just focus on, hey, just find a deal. There's gonna be a bunch of sections that are released. My goal is to up us from the roughly 300 videos we have, if you don't count the mentorship videos, which there's over 300 hours of, by the way. Uh, but the focus is going to be on the mini videos and trying to get 500 of those done this year. I want to have the most robust platform bar none, impossible to argue. We have everything that you could possibly have in there, and it's all easy and quick to access. Average video, for those who haven't taken it, 3 and a half minutes, and we go over everything in an easy breakdown. So you can dive right in, choose what you want to learn, and just start learning. Perfect. Yeah, that is, uh, this is in reference to an earlier, uh, property that he brought up, or a town that he brought up. 19 population growth in a year, but it was like less than 5,000 people. So, you know, a few people moved in town, they went up 20,000, uh, or 20% in, uh, population, which is awesome. Luke, um, when you assume a note in contract for deed, typically structured a little differently, so we're gonna see where this goes. When you assume a note for contract for deed, uh, does the bank underwrite either you or a partner on the deal, or is underwriting just the property income? Um, on contract for deed, the bank wouldn't approve you because any existing notes stay in place subject to the existing debt. Um, and I'm not a big fan of that because it makes callable notes, so I recommend not doing that strategy. Subject to only works correctly if there's no due-on-sale clause, which if there's bank debt, there is. So if the bank's involved, involved, they're doing contract for deed, the bank's probably not going to be a player. You're probably doing a seller finance second for those. If it's bank combined with a seller financing note, more often than not, that's how that's done. Contract for deed where they're selling their equity to you Um, there is no bank underwriter involved. Also, would you rather just do a purchase agreement instead of assuming the note? Um, okay, so on note assumption, so if the note's assumable, then okay, well, that's another thing that you could do. I guess you could do contract for deed and then assume a bank note and the— they finance the rest of their equity to you. As long as the bank signs off on that, you're good to go. Um, I would rather just do a purchase agreement though, as, as opposed to assume a note and have a contract for deed. It's— if it's subject to— if you have an awesome debt product and the bank wants to sign to you and it's better than the bank note you would have got, then absolutely. I'd rather have the better terms. Like, let's just buy it and assign it. Um, however, they're not mutually exclusive. You can do a purchase and sale agreement. You're doing that no matter what. Like, if you're, if you're buying something contract for deed, seller finance through a bank, they're all a purchase agreement. Um, if you assume the note, you're still doing a PSA and you're purchasing the property, you're just assuming the note. So they're not mutually exclusive. So, uh, yeah, if the debt terms are better and I can assume them, I'd rather work with that bank or that lender. Oh, okay. A higher percentage is what this question was. So Dylan was asking on the previous question, a higher percentage of homeownership is better in the market, that'd be less crime competition, or less homeownership with the crime but more apartments. So do we own more real estate I think that's how I'm reading that. Less homeownership with more crime but more apartments. I'm gonna try to answer the question as well as I can on this one. If we have— if I'm just reading the more apartments part, more apartments is generally better. I would take a lower quality unit What I wouldn't do though, if we're talking equity, if that's what we're trying to say by homeownership, I would rather have more equity and less buildings than less equity and more buildings. Because then you could syndicate and you can own a little bit, basically nothing of a ton of buildings and say, oh, I have a bunch of units under management. It doesn't mean anything. Own your stuff. I have 200 units. I am partnered with Cody on most of them. I own some of them myself. I own some of them with other partners. I have a very high equity stake in every single one of those properties. Every single one of those properties, most of them a minimum of 25%, most of them 33 to 60%. Few buildings I just own myself. I would rather own 100% of 50 units than the portion that I do of 200 units. However, that's not the pieces that I had. Sometimes you have to buy with equity. So I brought in equity partners. Sometimes Cody finds a deal and I do the operations, and the two of us partner because I didn't find the deal. It's someone else's deal that we're working together on. So work with the pieces you have, but I would much rather have a 50-unit portfolio and it's just me on it. That is a way better trade. I hope I'm answering the question. This is a, this is a good question, but property taxes are so high in Texas. Yes, and the prices are so low. There's expenses. Everything's— it's a free market, which is the great thing. So when interest rates are high or taxes are high, prices come down. And when taxes are low and interest rates are low, prices go up. They just adjust. They're always in balance. So I am buying a 4,000-square-foot house in Texas. It's a good example. It is $100,000 more than my 1,290-square-foot house in Renton, Washington. Right next to Seattle. It is more than 3 times the size of my current house and it cost $100,000 more. That is ridiculous. Yes, the taxes are high, but the property costs are low. They balance. That's true of any market. Don't get caught up on the expenses. Look at it holistically. If you can find a deal that cash flows the same percent cash on cash return, and you make the same money, but taxes happen to be high, doesn't matter. Mason, thought on Denton, Texas? Love Denton, Texas. You're going to be competing with a gentleman named Cos who owns basically all of Denton. So good luck. He owns a— he owns 2,000 units outright through Texas and Missouri and Nebraska. He owns a lot of Denton, Texas, and his office is based in Denton, Texas. You can play the game there, but there is a, uh, there's a very, very, very big player who is still very, very active in Denton, Texas. Um, every broker in Dallas knows who that guy is. He's very strange. Can you offer Section 8 housing as Canadian? Great question. I have no idea. I do not know what your housing programs are. I'm sure it's not specifically Section 8. Because it is a U.S. government program. I believe Canada is known for having a lot of social programs. I am very sure you have something like that, but I don't know specifically what it's called or the specifics around the low-income housing government programs. What's the proper time to refi? How long before a balloon do you want to get started? Uh, ideal balloon is 10+ years. We have some 30-year balloons, we have 15-year balloons, we have 10-year balloons. I have some things that are 5. 5 is not ideal. That's considered midterm debt. That is not long-term fixed rate. It does give me a lot of time to move my pieces, but I have to have a game plan for what happens in 5 years to move this into long-term debt and get at least a 10-year debt product. That's how we play the game. So that's the time. Proper time to refi is when the market is ideal. If you have a 10-year balloon, it doesn't mean you're holding your debt for 10 years. It means you're having enough time to have up and down cycles. And when you have the ideal situation where you can pull out the right amount of cash restructure your debt or get a lower interest rate, you're going to go ahead and do the refi at that time. So there's a right time for every property. It's when you can pull out the cash that you want to pull out while maintaining a healthy DSCR of at least 1.5 or higher, and you get the interest rate that you want. If you can get all those pieces, that's when it's time to refi. And we know that in a 10-year window, we will have one full market cycle at least, usually multiple, which means you have ideal times within there where the market is going to be perfect for refinancing. A lot of people in 2020 and 2019 got these 3, 4, maybe even 2.5% interest rates on their properties because we hit the perfect time in the cycle. And even if you were 2 years into a 10-year debt, you absolutely take the 3% debt and lock that in for 10 years. But that is the right time is when you lower your cost, you pull out capital that you need, or you otherwise extend your balloons. Any of those are valid reasons to do a refinance. Christian, what does Chris Luna do exactly? His website is lacking on specifics. So I've met— he's a good friend of a friend. He's actually a close friend of Caleb Hommel, who's a common guest on this channel. Chris Luna is a— what I call him a micro developer. He specializes in ADUs, which especially on the West Coast, Washington, Oregon, and California, are a really cool opportunity. You basically have pre-built plans where you can build additional units on your properties, either renovating units that are pre-approved, so adding like a mother-in-law suite to a house, or detached, which are actually called DADUs, uh, but detached rental units. That's just an additional unit on the existing land on your property. They're trying to do what's called residential infill. So people have a lot of land, let's just add more units into the existing spaces. Instead of trying to develop new, you know, multifamily megaplexes. It's a way for mom-and-pop investors to get into development. He does a ton of that in California. He lives in San Diego. I believe he has a course on it. I have called Backyard Billions or Backyard Billionaire, something along those lines. Never seen his website, but I know what he does. And he is a— he is an ADU builder and he's very good at going through permitting and finding deals. I've looked at some of his projects. Some of them are pretty cool. He took like a single-family house with a good deal of land and turned it into a 20-unit, basically 20-unit apartment building. It's pretty cool. So the projects he's done, he's done very well for himself. Uh, he seems like a really good guy to learn from. Dylan, I talked to, uh, owners selling because taxes and insurance are increasing so fast in Houston. That he can't raise rents fast enough to stay positive. If that's your first property, how would you handle that? Raise rents fast enough to stay positive. Everyone else is doing it because their expenses are going up and expenses are passed through to the tenant, not the owner. No one buys cash flow negative property, period. If a seller's selling to get out of their expenses, they have to accept someone has to be willing to pay for the same expenses they're trying to get away from. It's going to likely affect the price of the deal, or you're going to get really good terms on the deal because they just cannot operate the property the way it needs to be operated. What you find with people who own properties for a long time is they're probably making enough money at some point, their property's appreciated enough, rents have come up enough where they're making fantastic money, and they slow down on trying to keep up on rents. And you find that they get really far away from market rent over time. When you come in, sometimes rent increases is what the property needs just for you to keep up and maintain the property. We're not coming in trying to jack rents just to make as much money as we can. That's not why we do it. We come in and we improve properties, and to do so, they have to be a profitable business that you're improving. Otherwise, they're going to start getting dilapidated, and that's where you get slums, which you see in little pockets of Houston, by the way. There's like— Houston's weird. It's like a checkerboard of, you know, nice neighborhood, bad neighborhood, nice neighborhood, sketchy neighborhood. You really want to have a broker you work with in Houston who really knows things in that neighborhood on a street-by-street level. Gary Cardone's talked about this with Houston too, and I've seen it a bunch of times. It's just a very odd city, the way that it's laid out. Street by street can be a lot different. Just keep that in mind with, uh, keep that in mind with Houston in particular. Assumption is not the same as sub-2. That is exactly correct. But if you're doing contract for deed and you're not assuming a loan and it's not an assumption, then you would be doing subject to. When you see contract for deed, typically people are using that to do subject to, otherwise you'll do seller financing. Contract for deed has other uses. You're not further encumbering the property, you're doing a sales contract. It's also easier for the seller to take back the property instead of doing a judicial foreclosure. So there may be reasons that the seller would prefer to do a contract for deed. Generally speaking though, when you see contract for deed, with an existing note is to do a subject to the existing debt rather than an assumption. Assumptions are very uncommon right now because you're usually assuming very cheap debt that the banks would rather replace. You've also seen a lot of banks go bankrupt or just get shut down by the Fed recently for not holding enough liquidity. So if they have the ability to pull back a loan they have lent out at 3% or 4%, you're seeing almost every bank opt to do that. Assumable loans in this market environment are not very common for for that reason. So usually if you see the words, hey, contract for deed, there's some existing debt, we're going to try to assume it, more than, more than likely the assumption does not work and someone tries to do a subject to, which is why you would use the contract for deed as opposed to seller financing. They are not the same though. Assumption means that the existing note is assumed by you. They will assign the debt, the bank will approve it, and they'll assign the debt to you. Assumptions are awesome. Subject to means you leave the debt in the other person's name and you now start servicing that debt and you hope that they don't do a title check or other audit because it does happen more than people think. Does it happen every time? No. Does it happen half the time? Absolutely not. It doesn't usually happen, but you absolutely can get those called. And so we'd always bring that up. Because I don't want anyone who's trying to get started or getting to financial freedom building their financial freedom on a portfolio of potentially callable notes. You can still use subject to and you can still expand with it, but if that's your strategy or that's the bulk of your strategy, I've seen people get their whole portfolio called. They actually built a whole portfolio, they lost their whole portfolio. Two different banks. They got audited, called all of them. Portfolio gone. And no, you can't just go back to the seller and force them to do a lease option. Do the seller said, hey, I'm not interested in doing an option agreement. Um, do on sales being called, the workaround was they had to sign everything back to the other owner, the, the prior owner, and they lost the portfolio and had to start over. That's why I'm so hesitant on subject to. Carlos. Do you recommend rental arbitrage to make Airbnb for touristy destination? I absolutely do not, for so many reasons. How could I calculate if I could cover the rent with future bookings? Uh, one, regulations are really killing that. Two, everyone is trying to do, do that. There is very little margin for a ton of work. You are leasing someone else's space to essentially, uh, Airbnb arbitrage, by the way, you rent someone else's space and then you put it up on Airbnb. So you, you do a rental and then you get a clause in your actual lease that says, hey, I'm allowed to put this on Airbnb, and you just make the spread between the two. It is almost every single time way too much work for way too little margin, and it's variable income. There is absolutely no reason to do it, and it's been way overused. The only people doing the Airbnb arbitrage model as their primary model are online gurus who are selling courses on, hey, you can make money on real estate without owning any real estate. It's super clickbaity. It's really easy to sell. It's like, oh, I don't have to learn how to buy, I can just rent something and make a spread. Variable income, low margin, really high operating skill, and a ton of competition. None of those are things that are attractive to me as a business because the word variable and tons of competition. I want to go into blue ocean instead of red ocean. I want to see just Open seas. I want to play my own game. I want to own my own debt. I want to own my own buildings. You don't get the appreciation in arbitrage because you're just leasing someone else's property. The true benefits of ownership come from being an owner. Focus on that because there's a bunch of ways to buy real estate with or without money. Arbitrage is my least favorite way to make money in real estate. Hey Carlos, sorry for just bashing on the idea. I understand the appeal. It is a mitigated risk way to make some money in real estate. My advice is take a little bit more risk and do something worth building, because arbitrage is— it's a rough business, and it really has been marketed to very, very, very heavily. There's a lot of people trying to do the same thing, which is going to make finding a deal very difficult. And if you happen to do this in an area where regulations change and the deal only works because you're getting Airbnb rates, and all of a sudden Airbnb gets blocked in your neighborhood. I mean, now what do you do? You're stuck in a lease but you can't make the money. There's a, there's a lot of problems with it. Luke, when you find an on-market deal with a seller willing to hold a contract, would you recommend writing an LOI or something else? I wouldn't. Um, is this where you like to use a term sheet? So I don't write LOIs unless there's something very specific that we're trying to negotiate that we need to get in writing to get it onto paper. So if the lawyers need something that's best represented in LOI so we can go back and forth, that's fine. If we have some creative term or something where they're like, I need to see something to wrap my head around it, the answer is yes, we will get that to you. Absolutely, no question asked, we can do that. Um, however, if I'm going to buy a property and I know I want to buy a property, I send an offer and I try to build relationships with every broker and every owner. So when I get an offer and they know it's coming in, we understand what's happening and I'm going to get it accepted. I don't write LOIs. There are people who just send letters of intent on all sorts of properties and they're like, oh yeah, I sent out 50 letters of intent and one comes back and I buy a property. I've written— I was gonna say 3. That's not true. I've only written 2 letters of intent ever, and both of them were to clarify terms that we had negotiated verbally but needed to have on paper before we went mutual because there was a little bit creative creativity. One of them, while we were looking at, uh, with a friend doing a reverse amortization, and on another deal we were just trying to put together some creative finance terms on how the interest rate would change over time And it was much easier to just put it in writing, explain it in an LOI so everyone understood what the— where, where the goalposts were. Do you do property tax appeals every year? Um, will you in Texas? All of my properties have been appealed. We won every single appeal except for one of my more recent Texas purchases. Taxes didn't go up as much as they did pretty much everywhere else, and I'm not questioning it. If they do go up this year, I probably will appeal it. That, that just seems to be what you do in Texas because the whole state of Texas decided they're just going to massively increase their taxes. And, uh, yeah, pretty much everyone contested that. All right. I know Section 8 will sometimes only cover a portion of someone's rent and that that person is responsible for covering the rest. Is that just based on the individual's income? Yes, it is usually a specific percentage of their income. A lot of my tenants, um, 1/3 of their fixed income— so this is really common for retirees who don't have enough money because inflation ate them alive. They spend their whole life saving, and then we printed so much money that their savings aren't worth any— worth anything. Huge bummer. If you're on a fixed income, it is very common for them to say, okay, uh, you make this much, you're on fixed government income, a third of that's going to go to rent, and we're going to cover the rest. And there's different metrics for different people, depends on their application. Uh, but we house a lot of people where they pay us a few hundred bucks and the state pays us, you know, $600, $700, $800 on top of what they pay. Very common. Very, very, very common. You have to be in ludicrously low income to have 100% coverage from housing authority. You need to really need help. How to keep track of finances starting off? How should I? Oh my gosh, we did everything wrong here. But when we started really quickly, we got into Appfolio. If you have 50 or more units, you can use that. Otherwise, use Buildium. It's an excellent platform. I don't have any endorsements that say that, but I've used it before. I love that platform. Very user-friendly. But you're going to track it in property management software. A lot of it is very cheap or free. There's, there's a ton of options to do that, but you're going to track every income, every expense, and you're going to roll it to the CPA. What I did as we got a little bit more cash flow in the portfolio, so this was in year 2, we hired a bookkeeper who just does monthly bank recs. So at the end of every month, they go through every single line item. If there's anything that they don't know what to categorize, they ping us and we go ahead and just clean it up, and then we go on to the next month. And we just do that rinse and repeat on the entire portfolio. Luke, can you explain why closing costs are so low in solar financing? Having a hard time understanding this. Well, a lot of your closing costs, a ton of them, are your points to the lender. My last deal was 3 points to the lender, but it was hard money. Oftentimes it's 1% goes to lender. If you're buying some big deals, a lot of that money is the closing cost for the loan. With the loan on top of the 1% to lender, there's origination fees, there's recording fee, there's a ton of fees buried in there. Seller finance, your closing statement's like super small. You're basically, okay, title insurance, there's a little bit of title work done, uh, there's the broker's commission, there's a proration of rents, taxes, there's the security deposits, and that's basically it. Like, there's just nothing to a seller finance Note, you pay for the legal ahead of time, everyone signs. The paperwork is like that thick. You sign a few pages, note, deed of trust, done. Super simple. And because it's super simple, there's not a whole lot of people in the middle to pay, so you just pay for the property. What would the closing cost be? A few hundred bucks for title insurance. If you're paying insurance out of closing, there might be an insurance fee. Taxes. There's just not a whole lot of things that really cost anything if you're doing a seller finance note. Don't— how do you make sure there are no liens or encumbrances on the property or title? Good news, you don't have to. Title insurance will do this for you. So every single deal that you do, you're going to get title insurance. It's part of the closing process. When you open up an escrow account to get ready for closing and you go to a title company, or in some states the law office, they are going to do title insurance, which means they're going to look up the policy, they're going to send you every lien on title. And if they're wrong and they miss one, which I've had happen before, they ensure that everything is free and clear and in your name. We actually had one city misrecorded a property, and so it said that we owed 100% of the taxes for our 0% interest of the property when he got our tax bill and said that we owned 0% of 100% of the building is the way that they logged it. We were able to get that fixed with a call, and it didn't cost them really anything. They just went, oh, we made a mistake, clerical error, fixed. We've also had one where there were back due taxes and they never caught them. Not my problem. Other party didn't pay taxes. They had to pay their taxes to sell the deal. Title insurance insured over it and they forgot to check. Other party didn't want to pay those taxes. Title company had to go out of pocket because they did not do their due diligence and they got caught. So title insurance is how you fix that. Could you give the property back to the owner for like $20 instead of going into foreclosure? Um, that'd be weird to have them pay you to take back the property if you're, uh, if you are failing. But, uh, yes, usually you do what's called a deed in lieu. You're going to sign it over to them instead of them foreclosing on the property. Instead of getting foreclosure on your record, you just agree like, okay, this failed, we don't have to go through the judicial system because I know I'm going to lose, we'll just go ahead and sign it back to you. That is common collateral. It's if they want to go after other stuff in addition to the foreclosure is where you'd go full foreclosure. Or if they're just mean and want to go into foreclosure, uh, they can do so. But they'll usually start the process, and then you circle the wagons with the legal team and you agree to sign over the property. Uh, Carlos, how do you calculate the future bookings from the Robin Hood Resort before to make the deal? Uh, well, you gotta take the first— the future bookings on a resort based on actual analytics of nearby resorts. There's one called the Glen Eyre, there's one called the a big resort called the Aldenbrook, and there's a bunch of smaller motels in the area. So you look at occupancy, you look at bookings, you look at how the Robinhood's performing, their pricing compared to other units, and you make an educated guess with, with, you know, some software and algorithms on this is what the Robinhood really should be bringing in. So when you purchase hospitality, you're looking at different metrics. And I don't talk about it a lot because I, I'm not having fun running hospitality. I hope to one day. But it's a little bit more work than I personally want to be doing right now, um, because I'm a multifamily guy. I should have stayed in my lane. I didn't. I'm paying the price. But, uh, you have different metrics like RevPAR, which is your revenue per unit per night, uh, that's, that's looked at in hospitality. They want to see booking percentage. And then you're looking at automated variable pricing. So based on your competition, every day your pricing automatically adjust by how occupied you are, how occupied your competition is, how they adjust your prices affect, uh, affect your prices. There's a whole bunch that goes into resorts and the projections there. A lot of it is AI-powered, uh, but at the end of the day, you're just looking at what is our occupancy compared to our neighbors and what is our pricing compared to our neighbors and can we be competitive with them and what does that look like. That's why I don't like hospitality. There's a whole lot just going on all the time. It's much busier and I have too many companies for that. Dylan, do you have to pay taxes to move money from one property to use on another or to but another? I don't know how to read this one either. From one property to use on another. Okay, so I'm going to answer the question up to the, up to the, the, the or here. Do you have to pay taxes to move money from one property to use on another? Uh, no, you should also pay your taxes, but no. Um, also you can't just use money from one property to pay for another one. That would be called commingling of funds. Which is the last thing that you want to do. The IRS will get you on that. You can pay yourself as an owner distribution and then contribute to another LLC as a contribution. Or if you have a holding company that happens to own both, that holding company can now freely move money between the two properties. But you don't have to pay a bill on one property to move the money. You do have to move the money correctly. So if you have two different LLCs, two different properties, money needs to leave that property, be paid to the owner or entity that owns it,, and then that entity pays the individual that owns it, and then they can do an owner contribution to any other property they want because you can invest in whatever properties in your portfolio that you want to invest in. But it has to move through the accounts correctly unless you have a holding company that has equity in both. Cody and I have a few holding companies, but we have one entity that owns our interest in multiple entities, which means I can put money in that account and it can move directly into another building because that entity has controlling interest of multiple buildings. Troy says, don't forget to promote Northwest Action Summit. You know it. I, I actually, uh, opened this call with a whole thing on Northwest Action Summit, which I'm so excited for. So those who are new to this call, this is like the event this summer. It is right in the middle of Brandon Turner's event, but ours will be even better. We're on the river. This is my favorite event that we ever spoke at, by the way. Really well put together, excellent food. Uh, the venue this year is insane. 2 days, it's May 3rd and May 4th. It is on the river between Vancouver, Washington, on the Vancouver side, and Portland, Oregon. So fly into Portland, do not fly into Seattle. You're flying into— it's basically in Oregon, but you're on the river. Beautiful location, 2 days with investors, fantastic food, fantastic networking. We have Michael Zuber is going to be our our keynote speaker. He's a large investor out of California with a very successful YouTube channel. He was just on a couple of podcasts recently that I just saw with both Ryan Pineda and Graham Stephan. And I think later this week, possibly next week, but I think this week, uh, Friday, he will be on our YouTube channel talking about some of the lessons that I actually learned specifically with Michael. I had a chance to interview him, so keep an eye out for that. But that's Northwest Action Summit. Tickets are, I believe, a little over half sold out, and it just went live. So that, that is an event that will be sold out. So if you are interested in going, check that out right now, nwactionsummit.com. Like, 100%, jump on that right now. How do you find out your market's cap rate? The best way to do it is to talk to a broker in that market, uh, preferably at one of the bigger firms because they have a ton of data. So like a Colliers, a CBRE, a Marcus Millichap, one of your larger firms, they have fantastic access to data. And it's a great touch point for you to get in touch with a broker for a real organic question of like some markets, even the area of that market is going to have a little different cap rate. So say, hey, I'm looking to buy a property at this street, what are you seeing for cap rate in this area of town, or at least in this city, what are you seeing for cap rate? And they'll be able to give you some analysis. It's going to be a touch point for you with brokers. Use their data. All of that is free to you if you want to do other research, you probably have to buy some software. CoStar is the best software out there for that. I actually don't like CoStar for a lot of things like owner contacts and finding deals. Their data is fantastic for both loan data and for cap rates. I would look at CoStar really closely for that, but it's expensive cap, uh, uh, software. So if your goal is just to find the cap rate, call a broker. What paperwork can you ask for to see repairs, CapEx, uh, fix and when? So that's going to be in the profit and loss, their P&L. It also shows up in a T12, which is like another version of basically the same thing. You're just looking at the income and expenses of the property over the last 12 months. So I want to get a feel for those. If there's any major renovations they did in the last few years, I usually just ask what's new. And if, like, say they put on a roof a year ago or a year and a half ago, I'm like, can I see the invoice for that just so I have it in my notes? And that's we have that for insurance purposes. Super easy. But that's the paperwork you ask for, is invoices for super recently done stuff. Um, but most of your actual CapEx cost is going to be shown on the profit and loss statement. Can you purchase US real estate and offer Section 8 housing as Canadian? Yes, you can. I do know that for a fact. Uh, if you own in the United States, you are eligible for any of the Section 8 programs. Uh, that you can definitely do. Section 8 is not like— you're not the one receiving Section 8, you're just an owner of a U.S. property offering Section 8 services to U.S. residents. Oftentimes they'll just work directly through your property manager as well. A lot of my owners, they say, yeah, I'm fine with using Section 8. And people I manage for in Kensho Property Management, wearing the swag today,. But, um, one of the things we do is like we just sign leases with them. They work with Kensho Property Management. They don't have any idea who the owner is. They don't care. They're looking at the rental standards and the property management company that they're working with. Mason, how did you find out about the big player in Denton? Um, I flew down and met him. I do owner meetings, uh, like exactly like I tell everyone to do. If you call me and tell me, hey, I actually call him, but if you talk to someone and you have a great conversation, and in the conversation they say, I own 2,000 units outright, I moved to this country with no money and I built a 2,000-unit portfolio. I'm like, that's probably going to be worth the flight. Funny enough, it wasn't, but I was really curious how he built it and I learned a lot. And it was basically, uh, he was able to use connections from outside of the US to borrow ludicrously cheap money. And during the bank collapse years and years ago, he was able to basically buy huge, bankrolls of properties where he just had— a bank would go under, he'd call them and say, hey, um, I'll take all of your real estate pennies on the dollar. He'd borrow money at 2 or 3% from out of the US and buy, you know, properties at a quarter of their price. I'm like, okay, that might be hard to repeat. It was fun to learn the story. I was like, I don't know that I have a great takeaway for like how I'm going to build my business, uh, but that's how I met him is I talked to him. Actually, one of our mentees had talked to him. He didn't have a deal they were interested in, uh, but they're like, you should talk to this guy, and he happens to be really near Dallas where you want to live. And so, uh, talked to him, booked two other owner meetings because that's what you do when you're gonna fly to be in town, and, uh, landed, and within 24 hours, uh, landed, did three owner meetings, got back on a plane back home the same day. Great questions, by the way. You guys are— you— I'm trying to move quickly, but you guys are like— the questions are coming in. I love this. Gonna give Instagram some quick love here on some of the questions, see if they have anything over here for me. Uh, one person asked, when do I move officially? Either July or August, somewhere in there. My wife and I are debating. She wants to— we have a whole bunch of fruit trees we planted up here, and she wants them to all bloom and have fruit before we move, and I'd rather just move sooner to the new house. Everyone can leave your opinions in the comment there, but that is the husband and wife debate. Do we eat all the fruit in our backyard before we leave and stay another month, or do we just head out and move to Texas? My vote is be gone. Um, and Cody H asked, are you targeting new properties to place in Section 8 Housing Authority? If so, uh, what's in your price range typically? Um, I don't target Section 8, but I do entry-level housing, which is almost always a perfect candidate. Right now I'm doing hotel conversions, and there's actually Section 8 programs that are allowed to use my hotel conversions for Section 8, in addition to transient housing stuff. So I can actually have them come in on 3 to 6 month leases and rent out spaces in the converted hotel studios. But entry-level housing is usually like studios, ones and twos that are, you know, the bottom of the market rate. And then I have one comment that says, doesn't let me ask a question. It's like, well, if you put a question mark behind that, that would be a question. Oh, here, I'll answer this question here. How much do you pay someone slash increase the price to switch equity to debt? Oh, no way to answer that question. It's going to be completely custom. You get what you negotiate. Um, I am talking about doing this on a property with an investor for $300,000. And because I have made them a bunch of money on other deals, this is someone I've worked with 5 times. It is, it is a deal. It's the only deal that we have right now that is not going as well as I wanted to. It's still positive. It's still going well, but I had a lot of home runs and this one's just kind of like, it's not doing what we wanted it to and it keeps running into snags. They're talking about just like, hey, you know, instead of giving me my huge buyout, they're like, if you want to just roll a different deal in the future and you need the equity, go ahead and buy me out. Give me like a 9% return, we're good to go. Which is super generous of them, but they're like, look, you've, you've tripled my money in 3 years. We're okay taking a 9% return on this one. Let's just roll again. And I'm like, okay, we can do that. So they let me convert it to debt so I can go ahead and roll to the next deal. Um, that's really cheap, by the way. Sometimes it costs a ton. One of them to get a $200,000 note from $200,000 equity to $200,000 in debt. They wanted a $50,000 fee, and unfortunately it was totally worth it. So that's very, very, very expensive. So totally depends. It just depends on what you need and they need. That's, that's a circle drill thing. If you understand their goals and why they need the money and how they're going to utilize it, you can write a deal that says, hey, I understand why you need this and how you're trying to use the money. Let's put together a deal that gets you the right amount for what you're trying to do. It's just a mapping of pieces, but it's always, um, kind of a fun thing with creative finance. Like, you get to actually get in and negotiate. Here's what I have, here's what you have, how bad do I want it? It's very much like a board game. If you've ever played Monopoly, sometimes you have to trade way too much to get the card that you need. It's kind of like that. Also, sellers of Catan— sometimes you have to give up 3 wheat to get 1 brick. Sometimes you'll find someone who'll trade you 1 to 1. Totally, totally depends on the other player and the cards that they have. How do you pitch seller finance to get a portion of their building? Get just a portion of their building? I don't have a great answer for that. I've never bought just a portion of a building. I can't think of a reason that I would do that or how I would do that. You can buy a portion of someone's LLC if you wanted to partner with them. I've actually had someone buy into my LLC. So someone bought into 50% of one of my apartment buildings. We owned it 100%. We needed cash. There's a cost to trade equity for cash or cash flow for cash or cash flow for equity or any of the other trades when you're moving around your pieces. I needed to trade some equity for cash to pay down an obligation. And so we had someone buy into the existing LLC. Now, I didn't finance my equity to them, but I am actually going to take the other half of that LLC in the coming months, and I'm actually going to seller finance my equity to them. They really want the building. Um, I like them, they like me. Neither of us like being partnered with the other one. They run business differently than I do. I run business differently than they do. They're like, can you buy me out? Unfortunately, I can't because I'm building a house in Texas right now. I'm kind of focused on, on doing that. I want liquidity at this moment. So I'm like, I can't buy you out right now. They're like, okay. Well, in lieu of that, can I buy you out? I was like, you know what? Yes, yes you can. So I'm going to seller finance my equity in the building to someone else. So that is a way they could buy into part of an LLC. You really can't buy a part of a building seller finance though. Typically the debt's going to be attached to the whole thing. Now if it's multiple parcels, you can buy all of one parcel, but that's the best I can think to answer that question. For a review period instead of a buyout, what metrics do you offer to hit the extension balloon? So, so a review period is essentially saying, hey, we hit the end of our balloon, we need to sell or refinance, or we have an option to extend, which is basically going to say, hey, if we— maybe we pay $25,000, or on a smaller note, maybe we pay $5,000, and if we're in good standing, the note automatically extends. Or it can be, hey, um, we have an option to extend, but instead of 4.5%, the new note is— it goes to 5%, but we're allowed to extend. You can negotiate all these options to extend, and it usually says if we are in good standing or if this metric is hit— that could be totally negotiable, whatever they need— if this is done, could be a price, could be an increase in interest rate, then the note will automatically extend for X period. I love extensions though because it lets you get to the end of a debt cycle And if you want more time, you already know what it costs to buy more time. And Cody and I put these on a bunch of things. I have a note for 7 years that has an option to extend for another 8 years. I think it's a $25,000 fee to do so. And it's on a 10-unit building that has hundreds of thousands of dollars of equity. It's likely where interest rates are right now. We locked in a 5% interest only. I'm very, very, very likely to extend that another 8 years for $25,000. And it's $25,000 down. It's not just the fee, we have to pay it down, $25,000, so we get some skin in the game. It's a great deal. Of course I'm going to do that. On, uh, the rental arbitrage note, I met two people in Seattle who would do that with corporate housing for Amazon, Microsoft, Boeing, traveling nurses, etc., and did well 2015 onward. That's typically how you want to do that with the midterm rentals. You want as much stability as you can. Again, I don't like arbitrage because it doesn't answer my two questions. How do you own it? How do you never lose it? It's a fail on number one because we're arbitraging. We don't get the appreciation over time. There is, there is an exception to this. And also, I don't like Airbnb as a, as a model because variable income. But if you are a hospitality person and you do want to do Airbnb, one, buy bigger properties and do, you know, multiple Airbnbs in one spot. But if you're doing this strategy, do it on a lease option so you have an option to purchase it. So that now, now you're kind of doing it backwards, but it's closer. Now it's how do I keep it profitable, and then how do I own it, and then how do I keep it. It's kind of like how do I keep it, how do I own it, and then keep it. Um, there are ways to make it work. I think there's easier ways to play the real estate game that are less work less stress, more money, and you get appreciation. And the rate that this country prints money, appreciation is huge. Cash flow is super important, but cash flow is paying you while you get rich in equity growth. You don't get equity growth in rental arbitrage. That's why that, that strategy is still a miss for me. But that is a better way to play the strategy for sure. Traveling nursing thing, you can also do the same thing with insurance companies when families get displaced from, say, there's a home fire and they need to be housed somewhere. That midterm rental thing is awesome. So displaced families from insurance companies, traveling nurses, those are all ways to help stabilize your income. But make sure if you're buying real estate, own the darn real estate. The siren song of, hey, you can wholesale and get money without owning, you can arbitrage without owning, owning should be your goal. If you're going for financial freedom, own your financial freedom. Don't just rent it from someone else. That's, that's my two cents on that. Subordination, uh, you pay them more to go into second position. Oh, what if you need them to be in second position day one? So you can support— so, so I may have missed a context from another question, but subordination. So if you subordinate a note, it means that you are going behind another lien. And sometimes if you're in first position and someone agrees to go into second, they're going to subordinate to a new note. They usually have some— either they're paid for that or they get higher interest by moving into second. People don't usually just move farther down the stack, but you can subordinate a note. Um, If you need to have that happen day one— so the situation I can think of is the seller is seller financing, but instead of first position, your private money lender is taking the first position and the seller is subordinating in second position behind that. You're probably gonna have a higher interest note, and you're probably— not definitely, but probably— going to be asked for something, either other collateral in your portfolio or a personal guarantee of debt because second position has more risk. Most sellers won't accept that, but if it's what you need to do to get the deal done, you can absolutely pitch that and say, hey, I can do this, but I'm going to be bringing in private money that needs to be first position. If you're comfortable being second position, this is what this looks like on the seller finance terms. Subordination— I've seen people get a yes on it. I haven't had to pitch it, but people in our mentorship program have done that and have got the seller to seller finance in second position on properties before, and that is just a subordination of the note. Uh, that is in reference to a previous question. I'm interested in purchasing a property that's owner financed. They want to sell the property for $3.6 million, but I don't think it's worth that much. Should I get an appraisal or how do I find its value? Uh, you need to find the NOI and the cap rate, and then, uh, if it's a commercial property, you can figure out exactly what it's worth and what you should pay for it. Um, a broker's opinion of value is probably pretty valuable there. I wouldn't worry if it's seller financed and it's long-term. I care less about the appraisal than the cash flow. If the deal works fundamentally, if the amount of money you're putting in gets you the income that you want, I don't care as much about the value on long-term debt because value will get there. You can win on price or you can win on terms. If you're a huge win on terms, don't worry too much about the price. If it's a shorter-term note, price is extremely important. And if the terms are only okay, price is extremely important. You have to win on terms to do seller financing and be successful. If you're going to overpay for a property, there better be a reason for it. The other reason that you do this is there's a ton of upside in the rents. You're going to buy it where it's a little skinny day one but you have a plan for within the first 18 months to get the property where it needs to be and the return looks great. Well, now you can do the value-add project, and that's what Cody and I do on a lot of deals. You know, well, what is it worth today? First, what's it going to be worth in 18 months when I finish my project? And if we're somewhere in the middle of those two, we'll go ahead and pick it up on long-term fixed rate debt. Mason, if you start your real estate investing journey over again, if I were to do that, what would you do differently with what you know now? This is a great question. Would you have gone straight into Texas first? Oh, that last part is— oh, I love that. I've been asked this question before, but not, not with the Texas piece. Okay, I know what I want to say here. If I was to start investing again, I would have found what I'm best in the world at, and I would have stuck with it. So no, no resort. I wouldn't have gotten hospitality. I, if I could have avoided it, I don't think I could have. I don't like doing property management. It's very low margin. It's very low stress or very high stress. I don't think I could have done what I did without property management because there were no property managers who could pull off what I needed done. So I think I had to do that. So I wouldn't change it. But if I didn't have to do that, I wouldn't have. I would have changed those two things. I would not have started in Texas, and here's why. You're looking for the biggest advantage that you have. What is your unique advantage? One of the biggest ones anyone has is investing in a market that you can oversee yourself, that you can drive to. I live in Washington. I am grateful that I started my portfolio in Washington. The things that I learned in Washington, the portfolio I built here, made me a multi-millionaire. Means moving to Texas is a heck of a lot less stressful. We've been very public about this. I traded some properties to Cody. They're mostly the small properties, duplexes, triplexes, a single-family house that was kind of lumped into our portfolio, uh, is attached to other buildings, and it was a duplex when we bought it. But I traded Cody some properties that had some land so that I have more liquidity for Texas. I am downsizing Washington a little bit this year, and possibly significantly, and I'm going to be expanding in Texas because I'm enjoying managing there more, and I'm going to get a new advantage I'm going to be living in Texas, so my pieces are changing and my portfolio is going to change with me. I would not have started any differently because I lived in Washington when I started, and I'm glad that I started in the market that I did. So I think the only two things I would have changed are I would have— I would have done everything I did, and I would have— I would have learned more. I don't know where I would have learned it, but I would have found a way to learn more about how to structure my first few deals so that the buyouts weren't so darn expensive because I lost hundreds of thousands of dollars, and there were times where Cody and I really couldn't use that money. We, we spent a few extra $100,000 in the way that we structured our first few deals. And while our investors were absolutely thrilled that they got massive returns in 11 months, um, it was really expensive for us, and that made it slower. I— if, and if I didn't buy that resort, very comfortably I could say with 100% certainty, certainty, I could have a cash-flowing 500-unit portfolio if I didn't get distracted with hospitality and we just focused on buying the things that we're best at buying. I, I know what buildings I would have bought. I know how I would have pulled them off. And we did not have the bandwidth or the capital partners at the time because we spent our money and time on a different project. So between those two things— losing less money by being young and dumb, which is hard to do, and staying in my lane, which is easy to do if I had changed those two things, easily, easily twice the net worth, twice as far, way less headache, less time spent. But you never play a perfect game. For you board game players like me, there's always something you could have rolled a dice better and it just didn't happen. You could have made a different decision. Playing a perfect game is near impossible. I'm very proud of what we built with the pieces we have. Those are the two biggest things I would have done different. Definitely. By the way, on that event, Northwest Action Summit, with Michael Zuber there, he taught me about the importance of the buy box. I actually thought it was stupid because I'm like, well, we just find a deal and then match your money to the deal. Like, just buy stuff. I think that's how everyone should get started, and I stand by that. Look at your opportunities instead of like, hey, I only do stuff that fits this box. It's like, no, look at the opportunity in front of you and knock those out. But once you start buying things and you get in a rhythm and you find that thing that you're the best in the world at, build the buy box and say, okay, now I know that we're really good at value-add multifamily studio, 1-bed up to 2-bed. Uh, we're looking at entry-level. We like heavy rental projects. Not everyone does, but I am comfortable doing a heavy lift because I find those really fun, entertaining, and I have the risk tolerance for it. I also have the cash flow to afford that now. Take your pieces and focus on what you're best at. If you can do that. Man, I love that question. Thank you, Hobbs. That is a great question. Do you recommend a holding company slash LLC in the state that allows anonymity? Yes, but not to get started. If you haven't bought your first property, buy your darn first property. Figure out the legal structure later. It's not important. You're going to waste time and you're definitely going to redo it down the road for some reason. When you have a few properties and you have something to protect, play defense. This is a multifamily strategy course. Play offense before you play defense. If you're a team that plays defense the whole time, you're like, I'm just building my team and I'm learning as much as I can and I'm setting aside the maximum reserves and I'm going to optimize my holding company. You end up defending a game where you've scored zero points. Imagine that in football. Hey, we only got scored on once, but we never went out and actually scored a darn point. We still lost. You don't want a low-scoring game when you're trying to build financial freedom. Get points on the board, build your legal. Um, once you do that though, yes, I have a holding company. Um, I actually, you can do it in states without anonymity. There are actually ways to create circular LLCs. So I have an LLC filed by a holding company signed for by someone else simultaneously. That holding company is filed by a holding company that I own or that they own that I'm the signer for. And if you try to look up the owners, there's no way anyone can tell. It just goes in a circle. This entity owns this entity owns this entity owns this entity owns this entity, and these two are opposite signers for each other's entities, so I don't know who does what. Um, you can absolutely do that. Talk to a good lawyer in your state and ask them how anonymity is done best. Is it filing out of state in like a Delaware? By the way, not anymore, they're changing their laws. Um, Nevada, which is still very good. Um, there's a few different places that you can do this where they actually work really well. Wyoming, another great state to do this. I have Washington State holding companies, and I've actually had difficulties buying buildings because title took so long to just get the documentation to figure out how the heck we set this thing up. My lawyer's awesome. Ask your lawyer what you should do for your situation. That is the best— that's the best advice I can give. Stephen says thanks for the live. You're welcome. I love lives. This is super fun. Instead of having to like write content or do a bunch of research on like, what does everyone want to learn? Um, you guys can just tell me what you want to learn and then I do it. Any advice in the studio renting— the studios renting market? Um, studios are typically going to be part of entry-level housing because you typically don't have large families in a studio. More often than not, it's, you know, someone living on their own. You're going to have more turnover. So if you're going to do that game, get really, really, really good at leasing. That is, or work with a PM whose like superpower is leasing. Studios make about as much as one beds in almost every market, but they do have a higher turnover rate. So you have to be really quick at placement. If you are— if you find that you have a good PM or you yourself are really good at placing tenants, studios trade a little slower. You typically get a better price for them, and if you can keep them full, they can actually make more than the one beds because you typically win on price significantly more.. So that's something that I found in markets. I'm a really good studio operator. I also own the PM company and we're really good at placing and marketing. Take your individual advantages, but that, that is my advice for studios. LLC is a great idea. It is a great idea unless you own it yourself. LLC gives you no protection if you're a sole proprietor. People just dive right through that, that, uh, that, the, what do they call it? The, the pierce the corporate veil. Um, LLC is a great idea if you have partners. It is the one thing that I will say about partners, uh, if you have one partnership with one set of partners and a different partnership with another set, it's basically impossible to put a judgment against the LLC that has totally different members. If you own stuff yourself in an LLC and you have a judgment against you, they will go right after that asset just like it was you as an individual. I'm interested in your coaching program, however I'm not interested in buying multifamily but self-storage instead. Do you think your coaching will still be valuable? Heck yes, I do. Hayden out of Chattanooga, Tennessee just bought a 100-something unit self-storage facility after taking our course. My broker Eric, who finds all of our multifamily deals, owns over 500 self-storage units himself. I accidentally have a very teeny bit of self-storage, but I don't really count it because it's just kind of attached to my multifamily and it is what it is. The principles for buying self-storage are almost identical to multifamily. Um, in our course, these are the places where I found the most value because I also own office and I own retail because I have mixed-use buildings. I— if you're trying to buy office, sure, you can buy Multifamily Strategy, but there's probably another course for you. If you want to buy retail, probably another course for you. If you want to buy warehouse, there's probably another course for to. If you want to buy hospitality, like, like hotels, boutique resorts— Cody and I do that— um, anything where you're renting rooms to people or spaces to like individuals, multifamily strategy is going to make a lot of sense. So self-storage, check. Mobile home parks, check. Multifamily, obviously check. It's called multifamily strategy. Um, that's pretty much it. Hotels, self-storage, multifamily, mobile home parks. We're really, really well geared for those. I have a lot of experience in those, but the strategies are one for one exactly copyable, and we have students who have bought massive amounts of those asset classes going through the course. Great question, by the way. Um, Multifamily Strategy, I think, is a pretty good domain name, but I'm really happy I got the website and That's what we branded the company as. But that is a little bit of a limiting factor is when you have mentees who are like, I don't do multifamily. I'm like, yeah, maybe I should have gone with a more generic name, but it is what it is. If you are interested in that, seriously, I, I can help you with self-storage. I would love to see you there. If you have questions on that or want to discuss self-storage further, I'm happy to jump on a call. Hit me up on Instagram @ChristianOsgood.. And, um, yeah, I am happy to connect. We've had successful students there. That is worth mentioning. Q1: Best way to find comps beside CoStar? Uh, Q2— or Q, uh, 2-1: Is Reonomy better than CoStar? Um, okay. Oh, I see. Question 1, question 2. Okay. Uh, best way to find comps beside CoStar? Talk to a broker. I'm running comps better than CoStar. Next is use Reonomy for the comps. Um, Reonomy better than CoStar? Yes, Reonomy is better than CoStar on everything but cap rate and granular data on, uh, the actual building. CoStar is going to have all sorts of crazy stuff on like the, the pictures, the floors, the individual tenants. They're amazing at office, retail, industrial. If you're just looking for owner information, when things traded, and the debt that they have on them, Reonomy is simpler, easier, better cheaper. It's not a lot cheaper anymore, it used to be, but Reonomy is really good and it has better owner data than CoStar, which means Reonomy is a better fit for those in multifamily strategy. The way that we do business is better tiered to Reonomy by quite a bit. CoStar is more if you want to do like the mass message people or create a huge list. If you're like a list phone call person, CoStar. If you're a, hey, I'm going to, I'm going to go hunting with a sniper instead of a shotgun. I found Reonomy as the superior platform for less money. Eric just got here. YouTube recommended this video. Can you tell me about what you do? Well, heck yeah. I buy multifamily primarily, about 200 multifamily units. I bought a seller-financed resort. I've bought a mobile home park. I built a PM company. Alongside our good friend and YouTube partner, uh, Cody Davis. He's on this channel almost all the time. Most watched video of all time on BiggerPockets as far as their podcast goes. Um, we built that business in about 2 and a half years, and we share every Wednesday at 3 PM Pacific Standard Time until the questions end. Uh, we answer any question that you have about real estate, about business, about property management, about multifamily, uh, finding your market, just about anything you, uh, anything you can ask, we will answer. We've been doing this for a couple years, so I've had a lot of questions about a lot of stuff. Nice to meet you here, Eric, by the way. What's personal guarantee? Uh, even if you can't pay the debt, you will someday? Uh, well, it's more than just someday, it's a specific period, but it says I will pay this, and if I don't, you can come after my personal assets, not just the asset in question. So there is unsecured and secured debt. A personal guarantee says, hey, here's what I own, you can go after me personally if I don't pay this back. Personal guarantees are scary, and I have some for a lot of money. Um, banks will usually require a personal guarantee, by the way. Some seller finance notes will, some won't. They're actually a little bit hard to enforce almost everywhere. But that is what a personal guarantee is, is saying I personally guarantee that this note will be made whole outside of the performance of this property. I will, I will do this. Otherwise, if I fail the obligation, you can go after me as an individual. Don't— absolutely, man. Absolutely. What's your worst buy and why? How did you overcome it? My worst buy was a duplex on, uh, downtown Moses Lake, and we bought it knowing that it wasn't going to make any money, but because it was a future development site and it really moved the relationship forward with a large, large, large owner in that town. A couple problems with this: one, I have no interest in being a developer, so developing it was not interesting to me. Two, Buying a property just to move a relationship forward is stupid. This was one of our very early deals. This was in our first year of buying together with Cody and I. Um, recently Cody, who wants to be a developer, bought that property from me, and he's actually working with that seller to build 7 units on the back, townhome style. It'll be absolutely beautiful. So I'll have 8 total units on a land parcel. It's gonna spend like a million dollars on it, and it'll be all new build and beautiful. Not a project I'm interested in. It ended up working out really well for Cody, but for 2 years I had a tenant that had to be evicted. We got him out. The reno was very expensive. It's a property that just did not make money for the 2 years that I owned it. I'm glad it was a duplex. It was a small deal, but still just kind of a frustrating— I was like, there was no legitimate reason for me to buy that other than this should open up other opportunities, and we could afford it, which was the wrong way to think about it. I was like, we have enough cash flow to where if this never makes any money, it doesn't matter. I can pay this mortgage forever. That's a stupid reason to buy something. Buying something because you can is not a reason to buy a piece of real estate. So that was the dumbest one. I overcame it by selling it to Cody, who has a use for it that's actually appropriate. There we go. Uh, what do you think, uh, about to build rooms or tiny houses with steel containers? Uh, it sounds fun, doesn't sound that profitable. I don't think most people want to live in a box. Um, if you're a really good architect, like, there you go, there's your superpower, you can do that. If not, um, don't do anything super creative. Like, real estate should be boring, and that's what we learned by the Robin Hood It's super interesting, it's super fun, it's beautiful, it makes money. Too unique, too much time. Real estate should be super boring and super predictable, and you do that by buying multi-family properties. Or if you want to get into self-storage, self-storage properties. Uh, if you want to get in hotels, super simple hotels. Do the thing that you're best at and just do it on repeat. Uh, self-storage would be hard— or not self-storage, they're trying to get Shipping container housing would be hard because you have to get permitting, you have to be good at putting them together. Um, people might just think it's too weird and too quirky. I don't know if there's a market for it where you're at. Uh, that's my opinion on the steel containers. I looked into that when I worked for land.com before CoStar bought them. Uh, there was actually a whole company that was their whole thing, and I thought it was the coolest thing ever. I'm super glad I didn't get into that. I would have owned a few shipping containers and people would have been, you know, have a few tenants paying a little bit of money to live in a box. Um, oh yeah, if you're just hopping on, this is for everyone, if you've hopped on midstream, that is okay. I understand some people occasionally work at 3 PM and are not available for the live. Totally fine. Uh, all of the lives are going to be on YouTube, so you can always watch the replay on YouTube, the full live. As soon as we're done, it automatically starts uploading and you guys are good to go. I'm trying to figure out if my potential deal investment meets a 1.25 debt service coverage ratio before investing. Um, okay, uh, well, debt service coverage ratio is you're going to take your income minus your expenses, and then when you— after that, you have your net operating income. So how much money is there? What proportion of the operating income is your mortgage? So after you pay your debt What does that actual income look like? If your income is 1.5 times your debt, you have a— or your net operating income, if it's 1.5 times your debt service, which is your monthly income over your monthly debt payment, if it's 1.5 or higher, you have a 1.5 or higher DSCR. If it's 1.2 or higher, or what is your number here, 1.25? If NOI monthly over monthly debt service coverage is at least 1.25, then you're going to be fine on debt service coverage and you're good to go. Super easy to calculate. It's one of my favorites because it's easy to explain. Monthly income gross— like, or sorry, net grossly gross— uh, words. Your net monthly income over your net monthly mortgage. That's, that's basically what you're looking at. There's a part of the equation I need clarification on— the annual debt service part. Um, example, what's all payment— is the annual debt service coverage the debt for the hard money loan? Uh, yes. So your DSCR is your total debt. So your debt service coverage ratio is how much money do you have after operations to pay your obligation. Your obligations are your first position debt, your second position debt, is your full package of additional debt. You need to be able to service it. That's what DSCR is. What do you know about group homes? Not a whole lot about group homes. Um, yeah, I don't know a whole lot about group homes. I know retirement home communities. I've seen those work, and then I've seen like bedroom rentals. Um, group homes, I just don't, uh, not familiar with it, not something I've really worked on too much, and I haven't seen too many people do group homes in multi-family. I mean, no one's done them, but not my area of specialty, of expertise. Oscar, for the debt for the owner finance, uh, or the debt for the owner finance including the interest on both? Yes. Right. Um, so this is on the, um, the DSCR. Yes, it will be all the financing. So it's, it's just your income over your debt obligations. Debt service coverage ratio is all of the debt. Christian Osgood, what would you buy for your first investment property with very little money to put down? I'd buy the biggest building that I could buy with very little money down. For me, it was a 38-plex. My next deal that I found happened to be a 6-plex. Both of them were fantastic deals. Both of them cash flow very well. So what would I buy for my first investment property? That's what I would buy. I would buy the biggest deal that I could, either seller financed, or if it was well priced, with hard money, or if it was reasonably priced but hard money couldn't knock it out, with an equity partner. There's There's so many different ways to buy a property, um, with or without having money. That's— it doesn't really matter. You buy it— there's so many different ways to do it. You can do it out of cash flow, which means you're doing debt, so you have monthly costs that allow you to buy it. So financing, uh, you can do with an equity partner or someone just brings in the money, you get a piece of the equity and run the deal, and they get bought out later. That will later come out of the cash you have, but the cash will come out of your deal. So you'll You'll trade your equity for cash, then you'll pay them cash. Uh, you can trade the cash flow of the property for debt day one. There's a whole bunch of different ways to move the pieces, but at the end of the day, you just need to be able to buy the property, uh, with money. If it's not your money, you have to have a path to pay them back. How do you own it? How do you never lose it? Um, but yeah, for me, I was buying duplexes until my money ran out, and then I realized, uh, with little money I can buy a 38-plex. And that's what opened my eyes to that, and that's how I went from zero to over 200 units really fast. Again, I would rather own more of less units. So you may see me very soon go— I'm not sure, but I may go back under 200 units and have a higher equity stake in the stuff that I own, or just start buying more stuff on my own. Um, at the end of the day, you want to own your real estate. I don't want a whole bunch of partners and a whole bunch of different notes. I want to have, you know, one or two LLCs that own a bunch of real estate, and I want to be in the driver's seat of all We're not there yet, but you're starting to see Cody and I make those moves. And Cody and I work together, we're very good friends, and we're still partners on a boatload of stuff, and we're still taking on new projects. We should be, uh, pending one last piece of paperwork, uh, we should be closing on another building this week. All right, yeah, by Friday this week, if they can get the paperwork together, we should be buying another 15-unit. However, Cody buys stuff without me, I buy stuff without him. At some point Cody's probably going to be married and their family— his family will probably want to have their own buildings, and I want my own. And you can start trading buildings around and separate stuff out. That's typically how it goes, uh, in the real estate game. So the annual DSCR is, uh, hard money loan debt and seller financing debt? Yes, yes it is. All the debts, all of the debts. Do you need experience to seller finance? Fortunately, no, because I had no experience in seller finance when I did that. I owned a, um, I owned 2 duplexes, but I bought them both really recently. I had no experience. Cody's first deal, he was 19 years old, bought a 12-plex, no experience. You don't need any qualifications. It's the beautiful thing there. They have to believe that you are the person to buy the deal. If you're gonna instill confidence of this is why I'm going to buy it, this is how I'm going to run it— real estate is so simple. I don't worry too much about that. When someone comes to me and they seem like a basically competent person, like, this is my business plan, I'm like, excellent, this is what you need to be aware of. Um, I've seller financed people. I'm working on seller financing to someone right now. As an existing partner, I'm looking at selling my equity to them on a note. It's not Cody, by the way. Uh, as we put these things together, uh, qualifications— they don't do credit checks for seller finance, they don't do experience checks for seller finance. If they're asking a lot of those questions, it means you didn't instill enough confidence on the front end. Typically. Occasionally I get asked for like a schedule real estate, though. Some people have asked, but it's very uncommon. Commission buying your multifamily course, do you put, uh, pull videos from your channel and put them on your course? Are they all different videos? They are all different videos except for one. I have one that was a YouTube video that explained exactly what I wanted to show on the how to find properties. It was also a very popular YouTube video, so I was like, you know what, let's just go ahead and put this, uh, put this directly in the course. The other several hundred videos are an average of 3 minutes long, 3 and a half minutes I think. And, um, yeah, we upload new stuff every single month. They are completely unique and they are put in an order that I think is much easier than I Hey, I'm gonna go to a YouTube channel and just search through your different topics. You can dive into exactly what you want to learn, and step by step with no fluff, no, hey, I'm saying this for the algorithm, no, you know, hey, let me tell you about this other event that we're running. Like, you cut out all the extras and you go, what did I come here to learn? And that's what the course is. It's not optimized for YouTube, it's optimized for you to move forward in real estate. If you really want to streamline it, the mentorship's where you want to be, because you get all the information and then you get in a group of people who are all actively applying it. That's the ultimate goal that I have. So I'm always encouraging everyone to do the mentorship. But yeah, if you're looking at the course, I literally opened new sections of it late last night. I'm adding to it all the time. New Section 8 masterclass is on there, which is why we talked about a little bit here. But if you watch that course, there's just step-by-step things where it's like, oh my gosh, it's so much— it's so much more tangible when I can just make a video only about the one thing, and I have time to plan it out and script it. It's not just, you know, a conversational piece. It's like, this is how you play the game, period. Eric, any tips for finding areas where someone can buy large multifamily properties for less expensive areas? I'm in NYC. Eric, we have so many mentees in New York and New Jersey. I don't know why. We have a huge concentration there. Um, if you're finding large multifamilies for less expensive areas, The population growth is still the biggest thing for me. I showed this earlier. I'm gonna, I'm gonna go ahead and show it one more time here though. Um, let's see here. I'm going to present, share my screen. And so this was a market we're looking at earlier, Brownsville, Texas. Brownsville population growth looks like that. Yeah, I'm pretty interested. I think supply and demand Uh, we supply housing for humans. Humans want to live here. Pretty basic. You don't have to go to college to figure that out, by the way. Um, we don't develop this fast. This is the type of market that I want to invest in. Uh, that would be the first thing that I look at every single time. I'm gonna be looking at, okay, what would be the right fit? Let's look at a market. Um, is the population going up? Excellent. Then I'm going to look at the pricing there, and then I'm going to start looking at, um, a variety of factors. But I'm going to start networking with the owners and see where the opportunity is Am I trying to buy studios? Am I trying to buy ones? Am I trying to buy two beds? Am I trying to buy them all? Should I be buying Class B properties here? Is there still a huge need in entry-level housing? How does the housing authority look right now? How many vouchers do they have out? How many expired last year? Those are all questions that I would be asking myself that you can all— I mean, you can absolutely look at on, you know, in the course. I just laid that out in the last video. But those are some of the basic things that you're looking at is What is the opportunity in this market and is population going up? Last thing I would add to that, job stability matters. If it is like a military town and the military is the only employer, bases move, I don't like it. Uh, I invest heavily in Moses Lake, Washington. We have data centers, we have the lowest cost of power in the country, we have a ton of agriculture, we have Boeing, Microsoft, and Amazon who all do warehousing up there, and Boeing does a significant portion of their plane manufacturing testing up there. We have electric car battery production, which is taking off. They're adding 600 more jobs this year. And I look at all of these things and I go— and then you look at population growth and it's like this. I'm like, okay, Moses Lake, Washington, and Grant County, Washington has all the marks. It is far enough away from a major city where the pricing is lower. It has a lot of job stability, a steady increasing population. I love everything about it. Uh, Dylan says mentorship's great, you should 100% join. I agree, I agree, Dylan. I'm biased, but Dylan is not. Uh, he is not paid to say that. Dylan, we're grateful to have you here, man. Um, CJS highly recommend getting the course, ton of great info, and get the mentorship. I'm not paying these people, I swear, I'm not paying these people. Double endorsement in the same minute, look at that. Beautiful. Thank you guys, I appreciate it. It is— there is no part of my business that I'm more passionate about than sharing the story with people. It is so much more fun to play this game together. I started the course because I couldn't find any of this information online. I found like, I— there are people talking about creative finance, and when I took their courses, their courses were about wholesaling, and they're like, oh yeah, just save up money and then find something to sell or finance later. Or if you find a great deal, you can just wholesale it to me. I saw a lot of that. I didn't learn what I wanted to learn. This game's not that hard, so we just created the product that I wish I had. My goal for the course is like, sure, I will help you get to 100 units because it wasn't— it honestly, it wasn't that hard. There's a couple of mindset things that you need to get down, which you do in the first 5 minutes of the course, and then just like, okay, how do I actually buy a deal with or without money? Not that hard to do. You do it once, you can do it a million times. The purpose of the course is to save you money because the mistakes that I made learning how to do this cost hundreds of thousands of dollars. There's been 2 or 3 times where I'm like, wow, you know what would be great right now? A couple hundred thousand dollars. That is why the course exists. I want to help people on that. Um, Oscar, when renovating, where do the tenants go? I'm looking at a 43-unit property, uh, less than half need renovations. Do I renovate one unit at a time? Don't do that. Um, how much are renovations typically, uh, for basic fixes. Okay, don't do one at a time. Knock them all out as fast as possible. Vacancy will kill you. You need the income as fast as possible. Borrow what you have to, whatever you need to do. Get as much of your vacancy solved as soon as humanly possible. You don't need to remove anyone from a building if half need renovations, or less than half. But if you have a bunch of vacancies in here, say 25% are vacant, just renovate them right now. If they need renovations but they're leased, then you do them one at a time as they move out. Like, if they're already leased, they're, they're making money, run the property. If it needs to have rent bumps, raise the rent. If people move out as a result of that, go ahead and get in there and renovate those units as soon as humanly possible. Um, renovations is going to be very, very— they, they vary a lot market to market. Uh, for me, when I first started, I was renovating like $25,000 a unit. I realized that was stupid and I was getting ripped off. We've got that down to about $8,000 per unit. Every unit looks about the same. I use the same materials and the same contractors for just about everything. I have a group of 3, they all bid against each other, and I keep all 3 contracting companies busy 100% of the time. For a lot of them, I'm either their only client or one of their only 3 clients. We have a lot of work because I do a lot of reno. Okay, I have to put it up here because everyone's being nice to me. Mentorship's great, not just the course, but the course is awesome. CJS, these two are just really bumping me, and I appreciate you too. Seriously, it's, it's a fun community. I, I— the community aspect's why I do it. Uh, what markets are you looking into in Texas? Uh, I like Weatherford, Texas, a lot. It's, uh, it's basically a suburb of Fort Worth. Um, population growth looks better than the one I just showed you for Brownsville. Um, don't everyone just rush and buy there. If you want to compete with me, sure, but I'm very good at this, and I am buying in that market. So watch out. Um, that being said, yeah, there's areas all over Texas that are fantastic. Uh, San Antonio area— not in San Antonio, but all the surrounding areas— mostly excellent. Border towns— Laredo, McAllen, Brownsville— excellent, excellent, excellent. Um, lower income for sure, you're gonna have rougher properties down there, but finding great deals, seller-financed, excellent margins— I found a lot of opportunity down there. And, uh, right now the shipping industry and the trucking industry has a lot of turmoil still that they're figuring out from COVID A lot of the port activity has moved through McAllen and Laredo, so you're starting to see a lot of like the industrial sectors doing very, very, very well there, which is giving a boost to jobs beyond what I'd normally see. Um, so loving the border towns, loving areas around Fort Worth, loving areas around San Antonio. I think Austin is overpriced, which I rarely say, but you just have so many darn Californians there. And, uh, Houston is hit and miss. If you live in Houston, invest in Houston. If you're an out-of-area guy or gal, go ahead and look at another part of Texas. I think Houston is doable, but it's tricky. And I'm actually buying into a property in Houston, uh, but that is a property that is probably going to be unloaded. I'm buying into fix problems that I'm qualified fix, and then we're getting out of it. Section 8 have— uh, does Section 8 have max pays by area? Or let me try this again, reading. How does Section 8 having max pays, uh, by area impact your investment choices? Do you look at what they pay in different areas? Would you be more profitable if you did market rate? Why Section 8? So Section 8 have— well, one, they publish their rents. So if I do the deal, I'm just going to underwrite it as if we get to Section 8 rents, does it work? So more than just looking at different areas and what could I get, it's just a quick way to say I know we can work with Section 8 because Section 8 loves working with us, I love working with them, I know everything about the program. Because I do, does my deal work at their prices? Because if it works at their prices, I don't have to think about anything else. I know I can fill it with their people, I know I can fill it with market rate people. The deal works, let's get it filled. Once it's filled, then we go back and I go, okay, let's try to get more people at actual market rate. Maybe market rate's $300 more a month than Section 8, but the deal's working and it's cash flowing and it's stable. Then someone moves out, and now that I've fixed a vacancy problem and I've stabilized the property, I can optimize it by choosing my tenants. And but vacancy just absolutely sucks. If we can streamline our process and I can just underwrite It is so easy to underwrite a deal by saying, I've already been given the pricing, I know I can get this pricing, I've got this on other properties, this is what they're placing people on, they have voucher vouchers that are available, they need to place humans. I'm going to make a nice spot for someone to live and I'm going to go ahead and get Section 8 eligibility here. You can still get market rate tenants, by the way, but I always list at Section 8 prices, fill the building, do our increases after that. Do you lease the land for your mobile home projects? Uh, no, I own the land. Um, I don't like arbitrage, so I own all the land. And on my mobile home park, I own all the mobiles except for two. They came with the park. A lot of them are really rough. I'm actually kind of towing off a few of them and we'll be replacing some throughout the year. Um, but mobile home park, uh, in our particular one I own the land, I own the water rights, I own almost all of the mobiles, and once the park's fixed up, we're going to offer all the tenants to seller finance the mobiles to them, which is something that we can do. Hardest part of seller financing deals is finding a second loan to cover the down payment and closing cost. I don't want to give up equity or ownership? How do you guys acquire these funds? Well, you do— the order is deal, debt, equity. If you can't do it with a second, you may have to have an equity partner, but you can put a fixed buyout option in there. So you essentially treat them like debt, where it's like, okay, I'm going to give you a fixed payment in a fixed period of time, and here's what the buyout is going to be, and it's part of the operating agreement, and we're good to go. So you can treat equity very much like debt. So you're not giving up ownership, uh, just like the debt. You, you have an obligation, and when you meet the obligation, you now have it without the obligation. So ownership can functionally be the same thing as debt. It shows up different on title. And yes, having partners has its own headache, and equity is not like giving someone ownership is not the same thing as giving someone debt. So I, I do recognize that, but you can treat it very, very similarly with a passive investor, or mostly passive investor, who comes in, joins your LLC on the JV with fixed buyout agreement, you can structure it pretty much the same way. Um, so that's, that's number one. Um, however, I don't usually have a lot of trouble with the second loans. Um, just to be honest, if you have a great deal and seller financed and someone else sees the vision, uh, getting second position debt has not been the difficulty for me. Most people in multifamily strategy haven't had a lot of trouble doing that. But when you do run into the second position, and I've had this happen before. Um, what, what usually happens is actually there is a no further encumbrance. So there's seller finance deal and they make it so that your note isn't valid if you put a second position on it. If there's no further encumbrance of the asset and you can't put a second on it, equity partner, structure the equity like debt, is the best way I have seen to do it. The other, other way around that is an LLC pledge agreement where you say instead of encumbering the asset and putting a loan on title, You say, here's the LLC and the LLC owns the building. You are backed by X percent of the LLC, could even be 100% of the LLC. Here is your backing. I will pledge my equity of 100% of my LLC here. Now, of course, you put in there, in the event that we sell, this note becomes immediately due. Otherwise, you can pledge an LLC and then empty the property, the property out of the LLC and have a note backed by nothing, right? So do good legal and don't rip people off. But you can further— you can get a second without encumbering the property and actually creating a second, which has worked for us on multiple things. If we're not allowed to encumber the property, we encumber the LLC. Are you and Cody still into Pierce County, Washington investing in real estate, or is it overpriced now? Price isn't the problem in Pierce County. Legal is a problem. They decided that we don't care about any laws. They are overrun by homeless. I just had a friend lose a massive hotel in Tacoma. I, I can't— I won't say where it is because everyone will know what hotel it is. Um, in a very prominent area, a very large hotel, uh, they just had to sign it back to the bank because there are so many shootings that people are not attending that area of town anymore, and their hotel has gone under. Um, that is in Tacoma, Pierce County. Is really rough right now, and we're actually seeing some of those laws get challenged and reversed. I think it'll be much better in the next 2 years. Um, I used to manage in Pierce County. I actually pulled my entire property management company out of there just on principle because they passed laws that I think are ridiculous, and I can't keep my tenants safe, and I don't want phone calls of terrible crimes happening and have no ability to do anything about it. It's— I I hate that. So based on that, I have, uh, I've exited Pierce County and I'm open to it again if they change their laws and the police are allowed to do literally anything. Eric, so when you increase the rent on Section 8 tenant, uh, how does that— or does that work out? The voucher maxes out but they have to pay the difference, then the tenant pays up the difference? That's typically what happens in our market, and this is case by case, but in our market they have such a high need to place these people that they will actually let us 6 months in, as long as it is considered reasonable. And it's literally— there's no definition for reasonable. There's like, as long as it's reasonable, we will accept and pay for a rent bump. So they will actually pay you a little bit more. If I wanted to do, say, like a $50 rent bump on a bunch of the Section 8 stuff 6 months in, they'll just say yes. They're like, well, it's been 6 months, we haven't redone the, the next year's, it's reasonable that this could be accurate. And they'll just pass it. I haven't pushed the limits on that. Um, that has worked in my market specifically. In Texas, I haven't tried that yet, but I did just take a bunch of tenants from way under market rent to— I called Section 8 and I was like, we're way under your maximum, is there any reason that we wouldn't charge more? Like, are you gonna— our tenants aren't gonna pay more, right? They're like, oh no, they'll pay the same, we'll just pay more money. It's like, so I'm increasing all of these immediately, is that a problem? Nope, we're all good. Literally increased rent $400 a month on 10 units that month instantly, and they paid it, which was insane because I didn't underwrite for that. I did not know that that was going to happen, and we weren't told that many people were on the Section 8 program. So rents just went from like $450 to— in some cases, $450 to $850, like instantly within 2 weeks. It was— yeah, housing authorities are wild. It's government money and the government loves spending money. Uh, Danny, how's Robinette doing? Was curious because there's a big, uh, competitor right next to the resort, Alderbrook Resort. Uh, I've been looking into resorts, just curious. Uh, the great thing with Alderbrook is they're not a competitor at all. Totally different class of hotel. It's owned by one of the original founders of Microsoft, the Rakes fan. Family. They're like OG employees of the company that were paid with equity. They're billionaires. Next door, funny enough, is Bill Gates' property, is the adjacent property. And then you go one property over and it's our property. So it literally goes Microsoft money, Bill Gates himself, Cody and Christian Osgood, Little Teller Finance Resort. We are in the woods with individual cabins with hot tubs on a river. They are on a river and then on the canal. We have saltwater and freshwater running through our resort, which is actually pretty darn cool, except for the stupid beavers that keep trying to eat my trees. The Alderbrook is a Class A resort with a restaurant, 100 units, massive grounds, and a giant boat launch where seaplanes go and go to and from. Totally different price, totally different feel. People book our resort for events because you get 12 acres to yourself with no one else.. You can book out the whole resort. We are like a family retreat, wedding, small event, corporate retreat place. Alderbrook is like massive $50,000 wedding sort of place. So the good news is they are a complete non-competitor. We work very well with them, and I get their overflow all summer. So if they have a big event, they will actually send all of their guests to us, and they'll completely fill us up. We work very, very, very well together. If I had to compete with them, I'd be screwed. They are astronomically bigger piece of real estate than Robinhood, and the owners have unlimited capital. Uh, underwriting with Section 8 works best with large multifamily projects for a single dual try and so forth because the numbers and revenue are more condensed expenses. Yeah, I would say so. Um, Section 8 is easier on larger multifamily, but for all the same reasons that larger multifamily are easier than smaller multifamily. Family properties. People think it's easier to get into something small because it's just easier to mentally wrap your head around. A 12-plex is just as hard to manage as a 4-plex. Just from experience, I have 4-plexes that are way harder to manage than my 12-plexes. Uh, a 12, 4, if you're buying zero down, they cost you the same, but the 12-plex will always make more money, and you have more efficiencies, and you have more tenants under one roof, and so your CapEx per unit is diluted and your cost per unit is diluted. And when someone moves out, it's a 12th of your tenants instead of a 4th of your tenants. Uh, there's a million reasons to buy bigger buildings. Um, the Section 8 strategy works for the same reason that just larger buildings work better than smaller buildings. Uh, it's, it's harder to piece together a portfolio of really small things. From Scott, how many of your videos do I need to watch without skipping YouTube commercials, uh, to get free membership of Multifamily Strategy? Oh, that's funny. Um, the good news is you can learn everything you need to know from our YouTube channel. Realistically, I share everything and I believe in that. YouTube will never beat an online course because YouTube is super inefficient. You— the odds that I'm talking about exactly what you want to know on YouTube, unlikely. Like I'll probably cover the topic somewhere, but you're gonna have to search for it. And some of my videos, you have to just name them something that the algorithm's gonna pick up. Otherwise 4 people are gonna watch it. And I don't want to help just 4 people. I want to try to get it out to a bunch of people. So the only problem with YouTube I found is that I have to water YouTube down a little bit, not to sell courses, because that'd be stupid. I have to water down YouTube a little bit so that people actually watch it, consume it, and it gets out to more people, and people can join the lives and get, you know, higher value. Um, the purpose of the course is to streamline all of the information for you. It is ludicrously expensive to make. It's ludicrously expensive to advertise, but I want the course to go to the maximum amount of people. So, uh, short answer, you want the course, you're gonna have to buy the course. However, the course does have lifetime access. The mentorship, I am the coach. Cody and I both are the coaches. We show up to every call. Occasionally Cody and I will take one solo, but I mean, generally speaking, we're both there every week, all the time, 3 times a week going over Open Forum, which is basically this, but you get to talk back and forth verbally with faces and meet other investors. You have Deal Deep Dives. We're going to look at at least 5 deals every week, active deals that people in the mentorship are doing. So it's not theoretical, it is like, this is a real deal, we're looking at it right now, let's go. And then we do a structured lesson, which is like a 45-minute lesson, which is way more than I can give on YouTube, uh, but a 45-minute lesson on a specific topic that is structured, delivered specifically for that class with 15 minutes of Q&A. Like, that is what we deliver there. YouTube is just not a platform that can do that. If I could do it for free, I would be open to it, but I want to reach everyone with this. I want to help everyone who needs help, and that costs a ludicrous amount of money a month, uh, to get that out there. Dylan, uh, watch all the YouTube vids and then join the course. A lot of the YouTube, um, is in the course, but the course goes deeper and explains better, especially debt equity ownership meetings and moving pieces around. There is really— is the depth of the course is the point. Like, I could get very specific and I can take the time to put in more examples and more calculators, more downloadables, because it's structured and it's there for you to learn. And I will continue to invest in that forever. The course is my baby. I will do that till die. Seriously, um, there are a lot of online gurus who just like, oh yeah, I did something cool, I'm gonna— I'll show up to my class occasionally and I'm gonna have 5 other coaches teach it, I'm gonna just pay past mentees to run my course. People treat mentorship programs like a passive income stream, and I don't think that's the right thing to do. You need to provide incredible value And you have to enjoy being a teacher. Like, I don't want you guys learning from someone who learned from me, who's doing well. I want you to learn. If you're interested in the YouTube channel, just like I meet owner— I do my own owner meetings with people who have done the thing that I want to do. If I've done the thing that you want to do and you want to learn from me, I will be there for you on the call. That's the, that's the commitment there. And that's what I want out of the course, out of the mentorship. Um, you get the actual person. Let's hop over to some Instagram questions and we'll, uh, uh, probably wrap after that. I'll do Instagram, I'll bounce back to YouTube, and this has been like a 2-hour live, so, uh, you guys are getting all of this for free. Um, from BankUpTCC, do you think 10-year LBP floors will go out of style? I don't think so because they last really long, they're very cost effective I put them in units where you traditionally wouldn't do really expensive floors, and they're always going to be more awesome than carpet because carpet sucks. Carpet's gross. If anyone's removed carpet, it's always nasty. Carpet's just a really gross thing. My house, by the way, removed all carpet. My house I'm building in Texas, actually, it has 100% carpet because I'm redoing the floors before I move into it to make sure there's no carpet and I have the floors I want. Like It will be around forever. Glue down, absolutely. It's amazing. Some people love click together. Cody likes it. I hate it. It costs more, and if water gets under it, which sometimes happens, it's waterproof. You just create this terrible— like, it'll be wet forever underneath it, and your floorboards will rot, and it's awful. I've debated this with Cody before. Cody's had units flood where it got underneath it and it rotted stuff out. I think the click together does look a little bit nicer. I think it usually is just fine and waterproof, but oh my gosh, if there's a bad leak and water gets underneath it, you're done. Glue down LVP, it is truly like— it is a coating for your floors. Your floors won't get damaged. It's way less expensive, and it's very easy to remove individual planks if there's damage to them. Um, gosh though, I pitched that LVP thing so often, so often, because it's like, that is the product that cut my cost by a ton, and my tenants enjoy them. Like, entry-level housing, they don't care which flooring it is. It looks about the same, and they love it. Mike asked, uh, should I use 20 acres as RV storage or subdivide them and sell them in individual lots for private homes? Uh, which one makes more money? I just— honestly, that's— you can provide housing as RVs, and that's awesome, or someone can build private homes if there's a huge market for that, and you can get a huge injection of cash and buy 2 4 RV parks, I would sell for cash and buy 2 RV parks. If you can make 1 RV park and that's the highest and best use, make 1 RV park or RV storage. Um, depends on what you want to do. 20 acres is a very sizable piece of land. RV storage, you'll probably make a good deal of money if you have a developer who gives you an offer. Uh, what I use as a metric for me is I will sell a building— I haven't shared this in a while actually— I'll sell a building if the building, like the cash that I get after taxes, like my net after taxes is greater than 6 years of the cash flow, I can take that money and buy another property instead of wait 6 years. I get to move forward today. That's the barometer that works for me. After taxes, if I'm getting cashed out, you can also 1031, and then it— then I just reduce that to, well, if it's 5 years of cash flow and I'm 1031ing then I'll just 1031 something bigger. And if I'm taking cash out and I'm going to redeploy it elsewhere in my portfolio, I need to be pulling at least 6 years of cash flow after taxes. And if it hits those metrics, go for it. So if you do your 20-acre RV storage, but the cash flow of that would not be as great as, uh, you know, if 6 years of that does not equal selling it as subdivided lots, I'd subdivide. That's how I do it. A same person found 42 acres they want to subdivide. Um, oh, okay, okay, that's part of the same thing. This is in Idaho. Um, build your house, then build an RV storage thing. The other thing is, do you want the RV storage right next to your house? And that's just a personal question, but I personally think your house is worth more if you build— if someone comes in, develops a nice neighborhood with the other 20 acres. I might look at doing that. That's just me. What's your mentorship start at? Uh, $2,000 lifetime access to the course, the Facebook group, every piece of content that we put out on there, which is every single month I'm adding things to the course. Um, full access mentorship you get, uh, it's $5,000 and that is, you know, that plus 3 calls and you have a library of every mentorship call that we've ever done. There, there's over, I believe it's over 300 hours now. I believe, um, someone can fact-check me on that. Hundreds of hours of mentorship videos. There, there's no feasible way that you can go in and watch all of them. That would be ridiculous, and I wouldn't recommend it. Um, but you literally, you get a library of everything we've ever done on any mentorship call and ever will do for all time. So, and you're an active member either for 6 months or until you buy a deal that cash flow is at least $1,000. Literally, it works. You can, you can buy properties with or without money. We know this. We've seen people do it. Uh, mentees do it in our course all the time. I do it all the time. Cody does it all the time. You've seen Caleb on the channel. Logan, who I'm going to be interviewing really soon, does it all the time. Um, we will train you as long as you need to learn until you get your $1,000 of, uh, of cash flow. We, we guarantee that. That is a, that is a promise. We will, we will train you. All right, final YouTube questions. No, there's no new ones here. I've answered all the questions, I believe. Oh nope, there's one more from Dylan and then we're, and then we're good. Okay, here we go. So back, uh, so back to the market with, uh, 4.6K, uh, people in 2022. 2K, would you be interested in that market? Market 30 minutes from top 5 MSA? Yes, I would, if there's development going on in that market. Like, if there's some new buildings going in, which I'm guessing there are if we're seeing population growth there, and there are multiple employers. If there's just one employer there, I don't really like it. But if there's a few different jobs and they seem pretty stable, then, uh, yes, I want to own that. And a small, small enough market, we can absolutely dominate that market. And Dylan's apparently going back through all the mentorship calls. That's insane, dude. That is insane. I don't even know how one would do that. You are spending too much time. But no, I, I appreciate it. Um, that is it for the questions that we have for today. This has been Multifamily Strategy Live. We go live every Wednesday as long as I'm not on a plane and physically incapable of going live. Go live every Wednesday 3 PM Pacific Standard Time. We go to the questions end, which we have pulled off here. If you have additional questions, go to my Instagram @ChristianOsgood, follow me there. You can even follow me on X if you want. I'm also Christian Osgood there. I think it's MF Strategy is my, uh, my handle there. Biggest event that we have ever done by far, 250 people. If you're not— if you haven't bought your ticket yet, these are selling out ridiculously fast, which I'm very happy about., but Northwest Action Summit, nwactionsummit.com. Book your ticket. Cody and I are the co-hosts. We're both speaking. A lot of our friends are speaking. Best networking event that I've done, which is why we had the opportunity to co-host it this year. This is the one I wanted to be a part of. It's the only event that I personally endorse that is not just directly my own event. Absolutely make it out there. Vancouver, Washington, Portland, Oregon border, May 3rd and 4th. I want to see as many people from the YouTube channel there as humanly possible. It means the world to me if you guys can make it. So I hope to see you there, nwactionsummit.com. And with that, we're gonna call it a Wednesday.