Finding Deals How Christian Osgood and Cody Davis find them: Episode 2 of the live sessions

All right, we're mostly seated. I'm gonna start saying words as everyone continues to pop back to their seats here. All right, guys, uh, we saw— we talked a little bit about what a deal actually is. Let's talk about how we find them. Uh, if you came here hoping for some amazing revelation, this may be disappointing because how we do this is very simple. However, uh, there's a lot of different ways to find deals. I hate most of them. I have friends who do all sorts of like call centers, they do mass mailers. There's a lot of things that work. I like the ones that don't have any marketing budget that you can set on repeat forever and they continue to feed you deals. Those are my favorite. Turns out the best way to find deals is the few things that AI still can't do, which I also really appreciate. It's relationship-based. I love it. This is how we do every deal. There's so many— I hear a bunch of people try to get a bunch of different angles on, oh, like, I found this new way to do a deal. I'm like, technology moves so fast. Everyone You invent a new data source, everyone's working with the same data. A while back, I tried to build an app, which was a disaster because they didn't deliver the app, but I did pay them for it. The, you have like 3 data sources for all of real estate. It's all 3 companies own all of the feeds. So anyone who has some like, hey, I have this gimmick to get these deals flowing, we have these proprietary leads. I'm like, well, they can't be that proprietary because they only come from 3 data sources. Like everyone's working with the same data. So someone's saying, I have this amazing list. There's only so many ways you can sort properties. Everyone's working with the same data. So how do you rise to the top if everyone has roughly the same access to data, the same technology that's either free or really inexpensive? How do you actually move to the top of the list? Now we're gonna hit this really hard with Eric here because The broker relationship is huge, but I wanna go through the just general methods. Now for this, I'm gonna do this split. I'm gonna talk about the broker method. I'm then going to have Cody join me on the second half of this one. And by join me, I mean replace me and talk about some of the stuff he's doing with owners because what Cody's done with owners, and I do a lot of direct to owner, Cody has done it to the highest level of anyone that I've ever seen. The way that Cody has done it is just insane. And our company really started when Cody and I originally started Multifamily Strategy back in the day. Cody was one of the founding members of the two of us. Cody put together a model that is really what got me out of the 9 to 5 and into like, hey, we need to do— I need to do what you're doing. It was really mostly direct to owner. So I'm going to have Cody talk about that because that is where he has just shined at a totally different level. So how do we actually find these deals? Like I said, many ways to do it. There are 2 that really matter. Uh, first is active listings. If you're like, well, I just flew across the country— many of you guys are from out of state. Who flew in from out of state, by the way? Wow, almost everyone. That's awesome. You're like, I just flew across the country for someone to tell me that I just need to look online and find deals? Yes, but it gets better. Uh, so the number 2— like, these are the 2 places that you can really go to find deals right now. I have them in the order that I like to see them. So if you see the little teeny screen over here, Again, sorry, the big screen died. So we have what we have. CREXi and LoopNet.com. I worked for LoopNet and CoStar for many years. CREXi is slightly better. It's easier to find the correct broker's numbers, and they don't suppress as many listings as LoopNet does. If you're in a popular market, LoopNet will try to push some listings down so that brokers pay to promote them. Their business model. So CREXi first, LoopNet second. They have like 95% of the same deals, but there's a few that will be on one that won't show up on the other. Look at these 2 spaces. This is what it looks like in practice. You go onto cracksheet.com, you look at the deals. This is something that I really appreciate though. There is nothing when you are looking at a listing and that 38-plex that I talked about, this is exactly how this works. There is nothing about the listing that makes me go, this is a good deal or a bad deal. A deal is a negotiated property where we've identified what they, the seller, is looking for and I understand the numbers of. Most common problem that I see people do with this method. Someone will say, "I can't find any listings." We'll go on to Crexie, and they're like, "I've called all these that look good," and then we'll go through, and I'm like, "What about this one? What about this one? What about this one?" Like, "Oh well, the price is too high. That one's unpriced." You haven't negotiated a price. Everything is unpriced. The word unpriced is the same thing as $1.75 million. I don't know anything about the property when I'm looking at a listing other than the picture of the building, and maybe it might say on it how many units there are. That's all you're seeing here when you look online. Your mission is to figure out where does the deal actually work for me. When we go through the underwriting section, we want to determine when a deal is a deal, what it works for me. I need that baseline of when is the deal good. I don't have that just from a listing. What do you have from a listing? I have a broker who is listing a property. That's valuable. Does anyone think that maybe if a broker has 3 or 4 listings that look building-wise like exactly what you want to own, that they may list other buildings just like it in the future? They have a pipeline. They already have the product that you're looking for. This is the Starbucks order system. The broker is sitting there for the most part waiting for you to place your order. I mean, it's a little bit more advanced, but like shockingly, I was an agent for a while, it's not that much more advanced. I am waiting for someone who wants to place an order and then I am helping them get their order in and get the coffee made. We're going to push it through underwriting, we're going to get through title, and then someone's going to own it and I get paid. That's how it works in the life of a broker. Your only job is to be the most ready, able, and willing buyer for the property and position yourself as such so that brokers go, I want to work with this person. So instead of looking at this, is this building worth $950,000? I don't know. People get stuck here. Wrong place to get stuck. Here's how you shop. Not kidding. This is the stupidest easy thing. Look at the picture. Does that look like the type of building that you want to own? Yes or no? If it does, Click it. Read a little bit about it. Does it sound like a deal that you could like to own if the numbers were fantastic? If yes, pick up the phone, call the broker. That's how this funnel works. You're going to build relationships when you actually put in offers for these. But a perfect example, I chose Houston as a market just because that was what the last thing I checked on CREXi was. So I took screenshots of that. When we go through CREXi, This building, I don't know too much about it. It's not the prettiest building I've ever seen. I don't know that I really am a huge fan of a yellow building. Is this something I could see myself owning if I was in this area, if it made good money? Yeah, this is great. Picture looks fine. We have Ernesto Ramirez as the broker and another broker on the listing of Marina. My laptop's a little bit small here. I don't know what the right price is for this. I don't care what the right price is for this. Here's what I do know. If I click on Ernesto here, he's closed 20 transactions. He has 52 active listings. He sold $6 million of real estate. He probably can help me. So even if I have a great conversation on this deal and it ends up not being the deal, if I can put together where would this be a deal and I can communicate to him in a sensible way, This is where I think the deal makes sense. This is how I think the bank's going to look at it. And this is where I'm at. What you've done is you've called a broker, you've explained what it is that you're looking for. You asked intelligent questions about the deal, and then you submitted an offer to them that makes sense in the context of where would a bank actually finance this. This is before getting into creative finance. This is how you avoid accidentally putting a sticker on your head that says, hello, I'm broken. I don't know what I'm doing. which is what you don't want to do. You can buy these deals with or without money. You can do this with creative finance. If you position yourself as someone who's not qualified to buy it, you will get objections that you've probably heard before. Hey, before we entertain any offers, I need to see a full proof of funds. I need to see you and all of your partners. There are so few real estate investors, like shockingly few, who are sitting with a bag of $2 million under their desk, just ready to put a down payment down. That is not a thing that investors are just— everyone here owns apartments, which we've established is about a third of you. How many of you guys just are always sitting on a pile of cash and just ready to go for every down payment?

No.

Zero. Okay. Real estate investors, surprise, if you're brand new, you tend to invest the money that you have. So what you end up with when you have a lot of apartments is you have a Very consistently, a lot of very, very, very wealthy, high-income broke people. We don't usually hold a lot of cash. It's just not something that we do. When we have it, we like to deploy it. So you almost never have the money. So when someone's like, hey, can I see this money sitting in a new account? What it usually means is I'm not sure that you're the right buyer to close this deal. There is something that you have done in the conversation that dropped confidence. Now, some brokers just do this as part of their policy. There's a ton of ways to overcome it. We'll get into them. But in general, if I talk to this guy and I ask great questions, and I don't just ask great questions, I get back to him 15 minutes after this call, I'll underwrite the deal. I'll say, hey, I looked at this. If you have a business partner, I had a conversation with my partner. This is where I'm coming out on this. This is where I think the bank's going to come out. Rule of thumb that I have used. If it's 15% or within 15% of their asking price and they've listed an asking price, ask them, hey, I'm good to go at this price. Can we submit an offer? If you can't do that, it's more than 15% off, then call them and say, hey, I came with a number. This is where I'm at. More importantly, I think this is where lending's going to be on this. Would this be a waste of time to get this offer in front of the owner? What I don't want to do is waste their time. I don't want There's nothing more annoying as a broker for someone to send a ridiculous offer and you're now obligated to present that. That's how it works as a broker. You have to present all offers. I just got another offer on one of my buildings where he is like, hey, this— the buyer just wants you to pay off the building and then seller finance $850,000 back to them. I was like, Eric, what do you think I'm gonna say? He is like, I know I have to present it to you. I'm like, okay, cool. You know what to do. Tell 'em no. That's like you want to put together. This is where this works conventionally for me to buy the deal. What I've conditioned this broker for is when I reach out, I'm not just looking for properties. I'm not just asking. I ask quality questions. I go through the script, which I'm just about to give you. And our conversation is now, how are we closing this? And everything around the context of this conversation is I want to close this. How would we close this? This is where I'm at on this deal. When I call, it means offers. If I am a broker and I'm working with someone who puts together deals where I know they're going to work conventionally, which brokers know what price it's really going to trade for, for the most part. So when I'm putting in offers and these offers make a reasonable amount of logical sense, whether or not it matches the asking price, if it makes sense how you put it together and you're able to put in offers, you have moved from I'm someone who has no relationship to this broker, to this is the person who calls, can analyze a deal, gets back, and is ready to move on a deal. Brokers work with people like that. That is the number one pipeline that I still use today. And what ends up happening is my goal is I will call 1 or 2 of these a day when I'm searching for properties, 1 or 2 of these a day in an area that I want to own in. Build relationships with brokers over time. When I've called all of them, expand the radius a little bit, keep buying. It's the entire pipeline. It is the simplest way to buy real estate, but the sticking points that almost everyone has when we go through this is, one, you're just not ever calling on the listing. They're there waiting to talk to you about real estate. People just don't call. Second, when you pick up the phone, you ask way too many questions, you ask way too much of the broker, and then you don't submit any offer to them. So you put yourself in the camp of people who ask a ton of questions and take a lot of my time and don't make me any money, which is not where you want to be with a broker. Be efficient with your questions. Ask closing questions. Get to where you're trying to go. The goal is once a week, I want to write an offer on a deal where I think I know what they want. I have an idea what I think the seller wants. And I, I always just put it like, do I believe that there's a 33% chance or higher that they could say yes to this? If the answer is yes, submit an offer. If all you did was submit one offer a week at a 33% chance or higher of getting accepted, you're usually within 1 to 2 months of getting an offer accepted. That's usually how it works. When I need a deal, call the brokers I've already built a rapport with, see if they have anything, because I now have the relationships. We built the model. The next thing we do, just go call the active listings and find someone else who's listing properties in my area, and we build a new relationship, make a new friend. That's the whole entire model for these. The broker relationship is the simplest funnel, but I see people mess it up all the time. So I'm going to talk a little bit about direct-to-owners, and then I'm going to pass it to Cody to continue to talk about direct-to-owners. So Cody, you're almost up. The premise of this, Google Maps is the easiest way to do it. You can also just go drive the market, but what you're going to find is that multifamily buildings from above look like apartments. It's an amazing thing. Owners are not that hard to meet with, especially after you've closed one deal in that market. So, what it's looked like for me, first of all, we'll do a deal. So, I did a deal and it happened to be direct owner in Stephenville, Texas. I had reached out to brokers.

I was—

this is— I've expanded my geography over time, found exactly where I wanted to buy, got the model. I'm like, okay, perfect. I— 25-unit, seller-financed, Stephenville, Texas. There's other people I met in that time, but once we closed, I called all the property neighbors and said, hey, just bought the building next to you. Would love to know the other people in the market as I'm— we're expanding down here. Would love to get coffee with you. Once you're in a market, everyone wants to know who their new competition is. Everyone else in town within 30 days, everyone within reason who owns rentals. I know all of them. I know who's trading what. Everyone, the few people you didn't meet, the other people will introduce you to. You build these relationships. What do they have? They have the network. They know the property managers, the lawyers, the ones you should avoid, the ones you should use, the plumbers, the electricians. They've already built the business. And so your business is there. You zoom in. This is, uh, Riverwalk Townhomes from above. That big loop there— and again, I know, smaller TV— if you look really closely, there's a giant loop that is a huge neighborhood of buildings that look like, uh, they would be an apartment complex. That's because it is an apartment complex. They all look like apartment complexes when you look at them online, for the most part. You're looking for big roofs, you're looking for communities. All I need to do is just figure out, okay, who Who is the owner of this property? And then I just ask them, you know, I had an image here, but it's gone. But in the background, that's a building right down the street. Funny enough, when I go through and do this, it's just a simple call to people who own real estate without trying to buy their real estate. And this is what I'm going to have Cody talk about. The goal of the broker meeting is I need to convince you that I am ready and able To buy this deal. That is all I have to do. I am here to make you money and for me to make money. That's how the broker relationship goes. Super easy. And you can build friendships out of that. On the owner side, I've never asked an owner to sell their property. I want to talk about what it is I'm trying to do very efficiently. And then I'm going to transition into what it is that, like, how did they build their portfolio? What advice do they have? Who should I know in this market? It's the biggest leg up you're going to get. It's the most valuable relationship you're going to get, much more than brokers. It's a little bit harder, but some of the best deals we've done have been that we do. I do this at local meetups. Ask brokers who to meet if you already have the broker relationships. Hey, who else do I need to connect with down here? Real estate groups online in your area. There's always a bunch of them. Washington State, WARI is the big one. There's groups All over every single market. Okay, Cody, I'm gonna have you come up. I'm gonna pass this mic to you. There you are, sir.

I didn't know we were doing this. All right.

That's okay. That's why I got a slide with you.

All right. So as far as And how long do I got for this, by the way? 10 minutes? 15, 20.

Okay.

All right. So as far as owner meetings go, the number one thing you got to know is people are looking for folks they can grow with. So just to give you actual numbers, give you an actual example, the very first person I ever built an owner relation with, my first deal, I was paying them $3,357 a month. $3,357.48. It was a little 12-plex, completely run down and needed a lot of work. Today I pay them a little over $52,000 a month in contract payments, most of which is interest. What I ended up being for that person was a way for them to pass on their legacy to their kids, to their family in a more simple manner. Ended up building a business of, I just did a deal with them for a little over 8 figures. On a seller note, and it was 6% down, seller financed. One deal like that's enough for anybody to change their life, to really set themselves up financially. However, it doesn't start there. So my first piece I'd like to share is you have to find someone that you can grow with. They basically become a partner. Maybe they're not giving you money to go buy a deal, but when you're meeting with owners, you really do have to view them as a A long-term relationship. It's not a transaction. Time and time again, I've seen people that have treated the seller-buyer relationship as a transaction. It gets very transactional. It's a one and done, or maybe get 2 deals done, and it ends up killing long-term progress. I actually just met up with my wife Ashley in the back. So we just got dinner with this relationship. They have a house over in Moses Lake. And They basically laid out the, the plan for me and now us years ago. And all we had to do was stick to the plan. We meet with people who have done what we want to do. We ask how they got there and ask if they were in our shoes, what would they do given what they know? It's super simple. Like Christian mentioned with the broker route, you find something you like, you call them. And you ask questions. With owners, it's just a little different, but it's equally simple. You find people who own the type of stuff you want to own. You call them up. Next step, learn how they got to where they're at, and then ask for advice on how they would repeat what they did if they were in your shoes. It doesn't really get any more complicated than that. The next thing is, even though it's a relationship-based thing, you know it's going to be long-term. Stay genuine to your goals. Share what you're trying to do. When I was getting started, there were people saying, well, you should try and say what people want to hear. Has anybody heard that? Where like, oh, I'm going to say this because I think they're going to want to hear that. Every time I did that, it backfired. I don't know if anyone else has done that. I've— that's one of the biggest mistakes I made in the beginning. It killed some deals, killed some relationships. Share what you're trying to accomplish. And you think about the circle drill. If anybody's been through the course, you've seen it. Where are you coming from? Where are you going? And what changes when you get there? It's really simple. You do that and you share that drill with everybody that you're working with, with these owners, and a lot of opportunities can come from it. With the, the broker route or Google Maps, right? Finding the big roofs. Bigger roofs are more likely to be apartments than smaller roofs. That was all that went into it. As soon as you find that— has anybody gone through OpenCorporates, found the phone numbers? Have we done that here? Raise of hands. If you haven't done it, raise your hand. All right. The only thing stopping you from meeting with these people is doing that work. It's very simple. You can go on to Grant County— oh, not Grant County, you guys aren't there. You can go to the county tax assessor, find out who owns it, whether it's a— A corporation. A name of a person, that's really easy. Some people own it personally. If it's not the name of a person, it has an LLC, just take the LLC, put it into OpenCorporates, it's free. It'll show you who owns it. You take that person and the address tied to the LLC, you put it into Google and type in phone number, and then their phone number pops up. It's amazing. I have not found a situation where that is not true. That is for big companies. It's for small companies. When we first started looking in Grant County, there's this complex called Weston Square, and the owner did everything in the book to try and hide their name, but they didn't move the parcel that they owned adjacent into that super secret LLC. And so we found out who owned it. You can find anybody regardless of their size going through those steps. But the next thing is you actually have to call. This is a drill I actually put Christian through. Do you remember your first owner call?

Yes.

What did you do?

So, uh—

I'm gonna make you do the thing.

This is a good story. I'll share this with the mic. So— Cody, when we first did that, we were in a car in Ellensburg at Starbucks, and he's like, hey, you should do this owner call. I was like, awesome. I'm like, what are the rules of the game? He's like, okay, so you have 2 options. You can ask them to sell the property or you can ask for a relationship. I'm like, okay. So we go through the thing and I call them. I'm like, hey, she actually picked up the phone on the first ring. I was like, I wasn't expecting that. I'm like, hey, you have this 20th place down the street. Was curious if you are open to selling. She's like, I'm not. I'm like, oh, well, shoot.

Okay, thanks.

So changing gears. Awesome. Well, I am an investor in the area. We own a couple of properties around Moses Lake. Pass your property all the time. Would love to meet up. She's like, no, I'm very busy.

Like, okay.

Well, if there's ever a price that you'd be willing to sell at, let me know. That'd be great. And yeah, I'll talk to you later.

Bye.

Bye. Uh, that's pretty much how the first one went.

Well, and the reason I bring that up is because even though he didn't have a plan, he didn't have an agenda, I took his phone and I hit dial. Because that's the biggest thing that's stopping folks from building these relationships is actually hitting the call button. You type in the phone number, you're like, eh, I'm gonna do it later. I've done that many times when I was getting started. It sucks because what happens is you start call— people call lists They get these big lists, they farm them out from title companies, and then you call and you hit voicemail and you do that 30 times and someone picks up and then you get nervous and you say the F-bomb and hang up and like people freak out. I've seen it happen over and over.

Oh my God.

Well, you know that feeling because you're like, all right, I have to call 50 people. That's 30 no answers. And then someone picks up and you blow it, right? You just have to hit dial because if you don't hit dial, you're going to freak yourself out. And everything you want, someone else has. That's the bottom line. So whatever it may be, could be the cool house, it could be $5,000 a month cash flow, somebody has it. You just have to figure out who has it, meet with them, and then go through what we talked about earlier. Go through the steps, figure out how they got to where they're at. One of the first relationships I ever had in Moses Lake, He house hacked a dumpy sixplex with his wife and his newborn, had cockroaches running around, a racist tenant, and so the tenant tried to chase him off with a shotgun. Like that's not, that's not great, right? But that's where he came from. He bought it seller financed, ten percent down. And so what is a logical proposal for me if he ever offered? To sell his property. Seller financed, 10% down. I'm using the stories. I got to remember the information after I get it. But I use the stories to repeat what they did. And that's how I just did the 8-figure deal with my wife. That's how we did it with 6% down. He's shared time and time again, this individual, that there were times that he didn't have the money. And so every time I get pinched, or I can't come up with 10% down, like 10% down on an 8-figure deal is 7 figures. I don't have it. So I just share that with him. I was like, look, I'm, I'm in a similar position you were. I'd still like to do the deal. I want to work with you. I want to continue growing with you. But in order to do that, I'm going to be right here. And I just lay out my pieces. And he said yes. And it's happened time and time again. You can do that with Any amount of owners, big deals, small deals, single-family, multifamily storage facilities. And the more people you learn from, you get the best pieces of information and you can omit the ones you don't like. You get bad advice. Has anybody been given bad advice from owners before or brokers? There's a broker in Grant County that they tried to double the price and they said it's the same amount of upside. I know Christian remembers who I'm talking about. It's— that's bad advice. He's like, well, you're just gonna have to wait a little longer to get the same upside. I'm like, well, it doesn't work. Didn't work at this price, it's not going to work up here. So you can take in the good advice from people when you meet with them. Treat them as owners, don't treat them as sellers. And if you can continue to do that for a long enough period of time and you keep getting great advice and applying it, calling people— What I've found more often than not is when I go through the whole owner meeting and I get great advice, and then I ask calculated questions. When I ask, how should I go about getting to where you're at? More often than not, they've offered to sell a building. That is how I've gotten these opportunities without asking for a sale. It's happened with multiple owners in Grant County. Majority of the owners I bought from in Grant County, which is just Central Washington, has played out like that. What would you do if you're in my shoes? And they say, well, I'd buy one of these buildings. It's like, okay, what are you thinking? And then they lay out the terms. They make it simple for me. Now, it doesn't always work on the first go-around. Sometimes you have to negotiate a little bit, ask, how could I do that? You know, keep pushing the ball down the field. Well, that's resulted into a lot of opportunities. So anybody have any questions on Owners? No? Good. All right. After the county assessor's website, you said, how do you— Yeah, so county assessor, if you find the name and the address that's typically associated with that, punch it into Google and put phone number. If it's an LLC, you put the LLC into OpenCorporates.

OpenCorporates.

Yeah, and that's free.

What would you tell someone who, I guess, they're trying to direct mail their brokerage and they pick up the phone and they get the F-bomb and they're like, all right, sorry, sorry for calling. And then that happens like 4 more times. Like, what kind of advice would you give them for the mindset to keep going? Because that's something that is, uh, you're really good at and that's like key in this.

Yeah, so the question for those who didn't hear it is when you get cursed out on the phone again and again What do you do to keep calling? And you just gotta stay true to what you want. If you know what you want, odds are what you want's worth more than the repetitive calls. And that's how it was for me. So I kept calling until I got what I wanted. And that's like same when we had tough projects. I pushed through until it was done because it had to be done if I wanted the end result. But if you don't really want the end result, then Like you just quit and that's what most people do. Part of, uh, we're gonna be talking about math in a little bit. Main thing I wanna focus on is being better than average. Well, average people put complaints above their goals, and I would say you should flip that. Your goals should be above the complaints, but it, it just depends what matters most to you. That's right. Uh, if they don't wanna meet, right, they just answer your questions on the phone, when do you call them back?

To try to get them to—

Yeah, that's important. So when you call people back, if they don't want to meet up, that does happen quite a bit. So people will meet with you based on where you're coming from. I've shared that a lot online. So if you're coming from a relatable point, people are more likely to meet with you. And that's where you'd want to share your goals in person. But if you can't get there, then the solution is getting a takeaway from the call, applying it, And then calling them back and letting them know that it worked. That's the thing people miss, because there's a lot of people that are too busy for you, right? It's just going to happen. But if you can get a takeaway, if it's clear they're not going to meet with you, get a takeaway, go apply it in your business, call them back, let them know that it worked, and say you appreciate it and you'd like to buy them coffee or lunch or whatever it may be. When you get to the owner meeting, since you're not like directly Trying to ask for a purchase, are there things you are looking for, like contractors in the area, things like that, that you try and get out of the meeting if you don't get us a property? Maybe. But the main thing is people will work with you based on the goals that you have. So a mistake people make when they actually get to the meeting is they keep trying to find relatable points, and that's a flaw. It's more of a character flaw. They just focus on, I'm trying to relate to you. And what happens is at the end of the meeting, the sellers or the owner is like, I really like this person, but I don't see ever doing any business with them because they're— maybe they could just be a friend, right? That you're just trying to be relatable. So that means you probably got to tweak the things that you're sharing in your meeting because that should come up naturally without asking. If, example, if I go meet with an owner and say, hey, I'm working on my first development. I found the land. Have you ever done anything like that? And they could— if they have done anything like that, they could say, well, yeah, I actually built a fourplex, and this is the contractor that I used. And if they don't just share that openly, you could say, which contractor did you use? Or did you do it yourself? Trying to phrase the questions around the end goal. So Being from San Diego, I don't want to invest there, so I target markets that I'm looking at. I don't have an anchor in those places.

How do you start it when you don't have a relatable, I'm the new owner next door approach?

Well, you can't say things that aren't true, right? That's not going to go very far. So you don't get to use the neighbor next door until you buy a deal there. But it was the same thing. So I closed an hour and a half ago on On a 12-plex in Quincy. I've been reaching out for 7 years. I took a selfie video, didn't meet with the guy. I met with him for the first time 2 months ago, but I kept sending him selfie videos as soon as I bought the first deal. But I couldn't have done that and say, hey, I'm the property neighbor here. The first deal I bought was 3.5 hours from where I grew up. Wasn't nearby, whether it's a flight or a car ride, doesn't matter. It was 3.5 hours away. So I couldn't use that pitch until I did it. But as soon as I got one, which was an MLS deal, right, it was nothing special, been on the market over 500 days, you better believe I'm taking a selfie video in front of the neighbor's property and saying, hey, look, I just bought here, I'm the new guy in town, right? But you have to use what's genuine to your story.

I was gonna say, and he's older Relationships, what do you see in like trends of like the pains that a lot of owners go through over the owning journey that you're like, oh, okay, these are some trends and that you start to relate with them on? That's great.

Yeah, there, there can be a lot of pain. It can come from debt. It can come from scaling too quickly, scaling with the wrong person. You could have really smart minds that are going in a similar direction, but it's just not the right partnership. And then they start to crumble. I'm seeing that right now with 2 guys that are financially way bigger than all of us combined. And, you know, they just have different strategies. And so a lot of the pain at that level just comes from having the wrong partner. Elgin.

Oh, in, in this environment right here, uh, this weekend, is there an opportunity for us to do the Does the owner play with successful guys like yourselves that own to see how we would go through that call, that first meeting?

Well, if you notice, this is just one big owner meeting. We just got a couple spectators.

Yeah.

What kind of voicemail would you leave if you don't Yeah, so if I already own something in the area, my go-to is, hey, this is Cody. You would obviously replace your name unless you want to leave my phone number, then they'll call me. But hey, this is Cody, I own the property next to you on whatever street, just give me a call back when you get this, and then I leave my number. That's it.

So for someone who doesn't own yet, Uh-huh. What kind of message would you leave?

Yeah, a message that you could leave is, hey, my name's Cody. I was looking at this property. It's listed over here on Marina Drive. I saw you had the place next to it. I'm just curious on your thoughts. Because now I'm asking for perspective on a different deal. I'm not asking them to sell me something. If they have time for information, great. But if they don't, then they're not going to call back anyway. Well, I'm asking about something that is actually real nearby, if it's something I want to buy. Now, I'm not gonna— there's some people online that say you should just pretend that you're interested. Like, you should only reference things that you're actually genuinely interested in. It'll come back to bite you if you do anything else. And I ended up buying both sides of the street, by the way. I bought one and then I bought the other. So I, you know, I did It did actually work out that way, but it took 5 years to do that. I think we're good.

Yeah, I think so. Things that I learned in this owner meeting cycle is it is not the fastest way to buy deals. If you are statistically, and I try to keep a ton of stats for multifamily strategy in general. Statistically, it's going to be a little bit north of 85% of deals that are done within our group. The first and second deal are usually through a broker relationship. And along the way, you meet owners, just like Cody said. Sometimes you call an owner and they immediately, they're like, hey, I'm trying to sell this building. Like, it happens occasionally. You call, hey, I just passed your property, had a question for you. They're like, I am trying to sell it right now. Can you— I'll seller finance it to you. I've had those conversations where they just throw it out there. Intro call, they're just like, trying to get rid of it. It happens occasionally. Usually what happens is going to be this multi-year thing where you're going to be working, you're building a relationship over time where it may be 5 years before a transaction. What I found with the direct-to-owner method, they have built the business that you're trying to build. Literally, they've built the exact business that you're trying to build. Most valuable resource you have. If you're going to get creative finance terms, they're going to offer that to people who they know, like, and trust already before it gets to anyone else. You're also going to see listings, not even listings, just properties available that never hit the market. Why would I ever call a broker to sell a property if I just met you for coffee and I know that you're trying to buy this type of property in my market?

Right.

They will call you for— why would I pay a broker to list something if I already have the buyer? It doesn't make any sense. The beautiful thing with this is you never have to, to your question, you never actually have to say that you want to buy their property. If I am meeting you to talk about the business that you built and explain what I am trying to do, it is implied that I would buy real estate if I'm meeting you to try to get more perspective on how to buy real estate. I don't have to tell them, hey, I would like to buy your stuff. Of course, I'd love to buy their stuff. I'm meeting with them to get the relationship, and that relationship does yield deals. That's the general owner model. And it works amazingly. I think it's the most powerful thing that you will do. It also just is not as fast. If your goal is the goal of this event, which is in the next 6 months, you're going to close on property. That is the objective here today. It's probably going to be through the owner, the broker relationship, most likely. Statistically, that's almost definitely what's going to happen. If you do this simultaneously and you just do these 2 things, You'll have brokers whose only job is to find properties and find buyers feeding you deals. And as the more you close, the more they like you. So you're going to build an endless pipeline of people who look for deals professionally in your area who are finding you deals. If you meet the owners, you will get more access to those deals at better pricing with more creativity, and you get all of the other benefits of you build legitimate friendships, which is actually really fun. Real estate can be a very lonely career. It is you doing your business and you bring on a few people along the way, but it's a pretty lonely solo job. It's way more fun when there's other people in your market who you enjoy working with. They understand what you're going through. When you buy a bunch of apartments, who here has family who owns a ton of real estate or even a significant amount? Zero hands. No, none of you. Amazing. I didn't expect that. Your family does not usually relate to you when you buy a bunch of apartments. They're like, oh yeah, you're doing that cool thing. 0% chance my parents have read my book. Like, they— I'm sure they bought a copy on Amazon. 100% sure they didn't read it. Your family doesn't care about your real estate business. Your friends who are not in real estate don't care. They're just not interested. It's like if I try to talk to you guys about one of my hobbies that you guys don't care about. Like, I don't go on and on about a board game because Almost no one here cares.

I care.

There we go. Almost no one here cares. We have just a, you don't want to be unrelatable. You want to just create the, the whole goal is just to like work with people who are doing the thing that you're excited about. If you've ever had any hobby or passion, which this actually operates more similarly to, other people in your niche are super excited. To talk about exactly that. If you guys know, I'm a Warhammer nerd. Like, I love complex board games. I love— hate painting models, love playing. You talk to other people who also like that game, crazy diehard fans. You build community. It's way more fun to do it together. So the owner meeting, you get to make legitimate friends, legitimate relationships. You learn so much. In Cody's case, like, Cody has one person who he's borrowed like $10 million from in seller finance notes. Actually, probably more than $10 million. I don't know. What's the number? Just out of curiosity.

Right around $10 million.

Right around $10 million.

Okay.

I know my stuff. There's a $10 million relationship that he built starting with one deal over the course of 5 years. You can't do that with brokers. So my argument is, while the fastest way to do it is with agents, you need to be doing both of these things. And if you only do these 2 things, I can say from personal experience, you can definitely get over 600 rentals. Um, because that's what we're— we did that. We're going to be probably close to 1,000, and it's not at the end of this year. And it's not about unit count. Unit count's a stupid metric, and I'm gonna illustrate that with Phil at the end of this event. But unit count is not a significant target. That being said, I can say that it has definitely worked for hundreds and hundreds and hundreds of doors. I don't have any other funnels. I have paid for no leads. I have never used other software. Caleb tried to use other software and he's like, I hate this model. I'm like, I know, that's because we have a better model. Be a person, make friends, work with brokers, work with owners. If you only do these 2 things, you will buy deals. Remember, your goal is do like a deal a quarter. Even 2 deals a year is huge. Just consistently buy a few transactions every single year. You don't need a lot of successes. Do not make this a grindy job. None of this is a grindy job.

Got it.

Awesome. Next break, everyone hang out, go to the bathroom, get coffee, do the thing.