Unlocking Real Estate Success: Seller Financing, Networking, and Mindset with Dane McKinney

And so it's like there's no deals and it's like, yeah, you're right. That's what, like, you have to make it a deal. There's no obvious deals right now. And so we're, we, we, you know, we bought, I bought probably 60 of the units that I bought that I know that's not— I bought 70 of the total units that I have this year and the self-storage this year. And it was all on seller carry. We bought one deal conventionally and that deal we raised capital for from an, from an investor. And so And then right now we're raising capital from, for another project from other investors. And again, that was a distressed deal. And, and so we're, we're finding deals because we're starting the conversation.

Welcome to the She's Got Assets Real Estate Investing Podcast. I'm the host, Shona Leppis. Follow along as we unpack and demystify real estate investment strategies through expert interviews and personal experience. From how to find off-market deals to creative financing to long-term and midterm rentals. We aim to educate and inspire others to gain financial freedom and generational wealth through real estate. And as always, please subscribe so you never miss an episode. We really appreciate reviews. It helps others find us and just helps us get found. All right. Welcome to the She's Got Assets podcast. Another really fun episode. I have a special guest, Dave McKinney, on. We met recently at the Salem Real Estate Investors event. It was a really great event for anyone that is local. It's totally worth the drive. I've been hearing things about it and I finally made it. And really quick backstory, this mastermind that was amazing, Dane was in my group. I had no idea who he was. I was like, oh my gosh, this guy's really smart and interesting. So we ended up talking a lot, but welcome Dane. I appreciate your being on. I'd love to hear just a quick bio and yeah, what you're all about.

Yeah. Well, I started in real estate like 4 years ago. I'm a young buck. So I'm 25 years old. When I graduated from Oregon State, I had a degree in finance, and I was initially in kind of private wealth management, and I wasn't super enthused by it. I mean, I liked the helping people invest their money and kind of helping people prepare for retirement, giving them a better plan, you know, telling them about strategies, I guess, of things to do with their money that they might not have known or been able to implement on their own otherwise. So that part was exciting to me. The part that wasn't exciting was that I didn't like the intangible piece of it. And so I always had an interest in real estate. I worked for a property management company in college, actually. The guy who ran it made me read his book on investing in real estate. That was one of the requirements to work for him. So that was, that was kind of the initial, like, literature that I read. I read that and then I read Rich Dad Poor Dad. So kind of a random— he was a former Stanford professor, so I'll give it to— I mean, he was a sharp guy.

Okay.

But he's based out of Corvallis now, taught at Oregon State for a while, and then has built up a pretty big portfolio down there. But anyways, I kind of saw the fruits of his labor because he was probably 70 when I was working for him. And I, you know, do a little quick mental math. He had like 400 units down in Corvallis and I thought, you know, this might not be— this might not be the worst thing in the world to get into. So then I, I ended up working for SVN originally, which is a commercial brokerage that's national, but they have kind of franchises around the country. I actually really enjoyed the team that I was working with, but there wasn't like a strictly investment-oriented team. And so that was a— that was something that I felt like was missing. I met with Gabe Johansen for lunch one time because my intent was to like try to buy his buildings. I have no idea, get somebody to like buy his buildings or like sell his buildings to somebody else. I don't know. Gabe owns, for those who don't know, he's my partner now, but he owns SMI Real Estate, which is the brokerage that I work for. As well as somewhere around 1,200 multifamily units. And so he's a, he's a big player in the market. And for whatever reason, I was like, well, maybe he still lets other people broker his deals. But anyways, I went to lunch with him and then we ended up talking for like 3.5 hours. And as I left, like, it wasn't even supposed to be a recruiting meeting. It was just like a— I asked him to meet, actually. And then we left and I was like, I'm going to work for that guy. Yeah, that's, that's who I want to end up, you know, doing business with, I guess. And so long story short, it's been— that was in, that was in the fall of '20. Yeah, that was in the fall of '22. And, you know, 3, 2 and a half years later, I have 80 apartment units with him. And a self-storage property down in Corvallis that we just bought that's 15,000 square feet with 151 units and 7 uncovered parking spots. So nothing crazy there, but we've just a small portfolio. You're the product of the, of the 5 people that you spend the most time with, and everybody who I spend the most time with is leaps and bounds further than me. And so I always— I kind of— it gives me a chip on my shoulder, and I constantly just feel like I'm not doing enough. And then I tell Gabe that, and Gabe's like, dude, you're 25. Like, yeah. And so he, he kind of— he does both. He pushes me to do more, but he also reminds me that, you know, I'm not doing terribly bad, I guess, even though I I feel as though I'm behind all the time. But I think that's the nature of an entrepreneur, is just feeling like there's always more to do because there is always more to do. And so there's never a day where I finish and I'm like, oh, there's nothing to do tomorrow. Just done. Good, I beat it. I won the game now. So yeah, that's, I guess, pretty good backstory. I also run a brokerage with my other business partner, Trevor Howard. So we run, we run a team, I guess is what it's called. And we have brokered together around $25 million, maybe $30 million in the last 2 years. So for being a new team and, you know, a down market, we feel pretty good about that. We're hoping, we're hoping to, to do $60 million this year. So we'll see.

I mean, I don't— obviously that's incredible. It's really inspiring. I would really unpack that. One thing I just want to circle back to was the— you said when you're getting into investing, the intangible part. And that's to me what I love about real estate. I'm curious, like, if you can explore that more because that to me, I can affect something. Stocks, I feel like it's out of my control.

Yeah. Well, I think there's two pieces to it. One is that when you buy real estate, you not only get to be the owner of the asset, but you get to be the owner of the business. And so in stocks, the key difference is that you really can't influence the outcome. I mean, and, you know, obviously if you're Warren Buffett and you own 15% of a company, then you can make decisions as part of, you know, you end up on the board of directors and you also have voting rights with the different share classes. But for, for all intents and purposes, everybody who's listening doesn't have control over the outcome of the business piece of the asset. And so I think differentiating those two things is— because when you start investing in real estate, you're not only an investor in an asset class, but you're also an investor in the business itself. And so you have to make sure that you have the systems and the business in place to run those assets effectively. And so that's kind of the the strength of our team is that Gabe owns a property management company, Mark Gallegos, one of my other partners, owns a construction and development company, and then Trevor and I both do a lot of like the high-level asset management. And so we're overseeing property managers. This morning I updated our global SREO, which is just our property tracker. And so we're, we're making like decisions based on the property tracker, based on what to do with the actual assets. And I love that, like we get pictures of the parking lot at one of our properties and we're like, hey, you know, it's, hey, this, this needs to be fixed. There's like 3 ways to do it. What do you guys think is the best? And you're running through how much it costs versus is it a long-term solution, is it a midterm solution, or is it like a quick patch? And so that's the side of real estate investing that's exciting to me, is I like— there's a decision made and there's a clear outcome and it's a physical product. Like, I know, I know what's been done and I know whether we did good or we did bad. Like there's no— there's not a lot of gray area when you finish a project. Like, we're doing a really heavy reno on a property in Astoria right now, and it was in terrible condition. And when you redo the siding, fix the roofs, repaint the whole project, redo all the patios, like, it's clearly better. And so that's the side of it where it's like, okay, we came in, we bought it, we put $1 million into it, and now I know it's good. Like there's no— it's, it's more of like an objective fixed than like, oh, I invested in the right stock. Like it turned out good. And it's not to say that you can't make a ton of money in stocks. And it's also, you know, leverageable and, you know, infinitely scalable. Well, close to infinitely scalable.

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But I just, I like that I have a physical asset that I can go see and fix and make better, and then that's where my money comes from, is making a thing better than it was. And I, you know, providing housing is just cooler to me than owning some tech stock. I don't know.

Yeah, all the, all the things I do want to underscore. But yeah, I mean, it is a business. I think it's not really like evergreen income. Someone put it that way. It's not passive. You need to manage an asset. You need to manage. And if you hire someone, but you need to be— it's not you're going to just buy real estate and sit back and just collect money.

Oh yeah, no, it's not. I mean, there's ways that it's passive, but you don't make— you don't build the equity in the passive Exactly.

Yeah, yeah, yeah, yeah. Okay. So I, so I wanna go back. So clearly that's like crazy. I mean, like building that business and that much of a portfolio, like what is like the, what did you do? Or was it like mindset or you're just like, I'm determined? Cause that's really, I mean, quite a journey. You're so young, right?

Yeah. It doesn't, I guess it probably is mindset then in that, in that sense. Because it doesn't feel like it to me. And I'm being genuine when I say that, like when I close on a property, it's the, the hard thing about closing on a commercial property more so than residential for me is that when we close on a deal, like it took us the first deal we took, we closed on, took 8 months to close probably. And then all of the bigger deals that we've closed in since then, The first deal I closed on was a 10-plex. That was awesome. It was a 96% seller carry that I structured for Gabe and Trevor to come in, and then I had a fee baked in for myself. And so I got to own the, you know, that person— I ended up owning 20% of it because I, I just pitched my fee back into the deal. I said, I don't want to get paid on it. And Gabe was like, dude, you haven't made any money yet. I know, because I'm like your PB, but so like, you should probably just take a check. And I was like, no, no, I got into this because I want to buy deals. It took some, a little bit of convincing to get Gabe to be my partner because he had met me, you know, in person like 3 months prior.

Right, that's impressive because that's a— it's very— it's a big commitment, right, to be a partner. So yeah, how did you do that?

I— well, I think part— I think it was really the same. I mean, goes back to mindset. Like, I was— there was no part of me when I put the deal up, when I structured the deal, when I put it under contract, like when I was talking to Trevor about it, because it was really me and Trevor going back and forth, and Trevor had already partnered with Gabe. On like 70, 72 units or so at the time. And so like Gabe trusted Trevor wholeheartedly because Trevor's a genius and Trevor like can't lie. And so he's kind of got that in him. And so like Gabe just listened to what Trevor said. And then the way that I talked to Trevor is what ended up making it happen, just in that like I, I made it clear from day one that my only goal was to buy real estate. Like I just wanted to figure out how I could get into investing and then force appreciation into properties because I knew that was the way that I could make the most money, even if it wasn't in my pocket immediately. And so that was part of the appeal too, was just the leverage of real estate and the leverage against something that you had control over versus leverage in stocks where— and I had done, I had done leveraged bets in stocks and they had worked out, but they had worked out like it wasn't— there wasn't part of me that was like, oh, I could do that over and over again and win every time. It was like I probably just hit it on an upcycle, like got lucky with a guess, read the right thing on the right day, and like got overconfident. Because in reality, I knew marginally more than the average person, even with a degree in finance, and nothing relative to people who actually invest in stocks every day. Um, and so the, the, the mindset of this is exactly what I'm going to do, like I know what the endgame is for me and I'm not going to waver from that, is what got me to the point where Trevor was then like, Gabe, like, he— I think he's being serious. Like, I know he doesn't own anything. Like, he doesn't— he's never bought a house before. Like, I didn't have a credit card at the time. I had no credit score, which is fine because we got a loan from the seller. But like, I had—

okay, so how did you convince the seller? Because that's an art in itself, right? Not convince, but it must have been a good fit. Like, we don't convince the seller, it has to fit. But Yeah, right.

Like, it was, it was, it was really just Gabe. Like, that's the whole— I knew, I knew Gabe was the buyer on the front end too.

That's it. Okay, so you had that. So I wasn't—

yeah, I wasn't finding, finding a seller to let me just go, like, market their property. I was— I had the buyer and I was finding the property. Like the deal for the buyer. So that's, that's the flip that we made where it's like, no, no, no, like this is who's buying it. He has 1,000 doors. He's never defaulted on a loan. He has, you know, $225 million in assets. This is who's buying your property. And like, I'm going to be on it too. But like, you don't care about that, right? Like, you know, I'm a, you know, I'm a good— I understand the numbers side of it. We can talk that side of it with each other. But like really who you're giving the loan to is Gabe. And so that's the other part of it is like Gabe knew that too, and he knew that like in the event that the property sucked and like we did everything wrong and it burned down, they're going after him. Like there's no, there's no part of them that's like, I'm going to go get it from Dane. Like, it seems like Dane might be our best option for a lawsuit here.

Like, it's—

and so, yeah, I mean, I think also making it clear that like I was going to manage the property and like do my best to be the decision maker, even though I didn't really know what was going on. I had done property management and I had been boots on the ground for, you know, that guy in Corvallis. And so I actually turned the first unit in that property myself, which didn't go perfectly. It was fine. We saved, we saved like $4,000 and I'm never going to do it again.

Yeah, it's, it was to prove a point. Yeah, totally. Well, I think so. I mean, we hear it all the time, but I think mindset in real estate is so important because we are in a really expensive market. And I think it's easy to say there are no deals. Seller owner installment plan seller carry is a unicorn. It's not. And I think that's so important. I don't think we can hear it enough, but because you have to just be— that's out there and you'll find it. But if you're saying there's no deals, it sucks to be a landlord, then good luck, right?

You're going to be right. Yeah, it's self-fulfilling. No, I totally agree. We actually, frankly, there's been more deals for us this past year because of that. One, because of the mindset of other people, and then two, because of where we're at in the market. And so it's like, there's no deals. And it's like, yeah, you're right. That's what, like, you have to make it a deal. There's no obvious deals right now. And so we're, we, we, you know, we bought, I bought probably 60 of the units that I bought. No, that's right. I bought 70 of the total units that I have this year and the self-storage this year, and it was all on seller carry. We bought one deal conventionally, and that deal we raised capital for from an investor. And so, and then right now we're raising capital from, for another project from other investors. And again, that was a distressed deal and And so we're, we're finding deals because we're starting the conversation. I mean, there's, there's a, one of the deals that we bought this year, the conversation started at $4.4 million with, you know, crazy structure and yada yada yada. And we had all the seller carry terms in place so we didn't have to put any money down. And, you know, it was very favorable for us. And then the conversation started. They knew that we were a real buyer. We talked to them for we closed it over a year after our first offer went out. And we ended up offering on it like 6 different times. But the final offer was like 3 months before we closed, and it was just a conventional offer at $3 million. And so the price dropped, you know, $1.4 million. It was overpriced initially. And then we got an as-is appraisal while we were under contract at $3.8 million. And so we, you know, it just took time, right? And, and so a huge part of it is like people see the price that's on the market and they think like, shoot, that, well, there's— I can't do that. It's like, well, tell them what you can do, you know? Like, tell— hey, and so our, our biggest thing, and I mean, we're not— we're by no means original for this, but it's just looking at the price on the market and saying, hey, we can hit— we can hit your price, but you're gonna have to, you know, carry 40% at 4% interest only for like 10 years for this to work for us. And, you know, 2 people said yes to that this year, right? And so we hit their price and then they hit our terms. And then, you know, other times it's just— other times you give that offer and then you're also giving an offer that says, or we can cash you out in 60 to 90 days, but it's going to be at a 25% discount. Because in reality, that's what That's what things are trading at right now conventionally is probably 25% below their peak, roughly. It's kind of maybe it's 20% for some assets and then like 40% for office space, but somewhere around there.

Okay. So many things. That's so— I mean, I think so. No, I love it. I just want to like, I think seller, it's a beautiful thing to not involve a bank and actually have an individual. It's just such a— and I don't, I don't know anything about commercial, so I'll be honest. Like, I'll probably ask some stupid questions, but I think, is there any piece of that when they're— and I think that I want to underscore that, like, you have to, you have to have a conversation, right? That's part of this, right? And I think especially with the way I was taught, like, installment plans, it's very much getting to know the seller, seeing what's a good fit for them. Do they have, like, is it any time of capital gains kind of thing that they're worried about, or is it more just like funding, or what's the motivation?

Yeah, no, that's, uh, that's huge. So The first, the first seller that we worked with on the 10-unit that carried the whole contract had it paid off, had owned it for 35 years or something. And they actually weren't concerned on capital gains as much. They were, but not as much as they were concerned about depreciation recapture. And so we did a land sales contract on that, which is an installment sale. And so you're You're saying, hey, I'm— well, I actually, I don't use the term installment sale. So there's a land sales contract and then there's a promissory note and first trust deed. So on a land sales, your name doesn't actually go on title yet. The sale hasn't technically happened. And so they don't, uh, they don't recapture their depreciation immediately. And so that was the biggest thing is that, um, they didn't want to have to, you know, get all that, get all the tax hit at once on that. And so we said, hey, you'll recapture the depreciation when we close on the property. But when we actually close in 10 years, you'll get, you know, $1.55 million. And so you'll be able to pay for it because they didn't want to carry 96% if they were going to have to go pay a tax bill for $100K and they didn't even get $100K.

Right. Yeah, that would be a bad spot to be in. Bring money to the table.

Yeah, that's not cool. And then on the capital gains piece, there's other sellers that— another deal that we did this year was 3.5% for amortized over— no, it's like 3, a little under 3.5% amortized for 40 years. And so he's getting principal paydown, but he's not getting enough principal back to have to pay capital gains tax on it. And so if you have under $86,000-ish of principal come back to you each year of capital gains each year, then it's not taxed. So it's over $86,000 up to like $250,000 is 10%, and then past $250,000 of gains is taxed at 20% federally. And so that's not— that's something that not everybody is privy to, I guess. And so something to keep in mind, especially on smaller deals, on a lot of like 2 to 4 unit properties, if you're getting the seller to carry and they're getting principal paydown, then a lot of times they don't have to pay capital gains tax, at least on the principal paydown while they're receiving it. And so in some scenarios, it makes sense to up the price a little bit and then pay like only principal. If it's going from, you know, a price of $700,000 to $800,000 and then you're paying principal-only payments, to them it's actually better because they're not paying— they're, they're getting that as principal, not as income.

So they're not—

as not income, it's not income, and it's not taxed at the capital gains level because they're receiving keeping a small enough amount to not go over the hump of $86,000 in cap gains.

Sorry, my brain's just like, yeah, there's so much nuance to this stuff. Like, I thought I understood. I mean, I know, you know, creative, but that's— I mean, because I was taught like interest only and or more, right? You're— because you're trying to get your cash flow to work, which is great, because— but if you can just— I mean, just principal, oh my God, that's like, you know, you're actually paying it down.

So yeah.

Yeah, that's really interesting. I mean, I think the beauty of, right, seller carry is that it's all negotiable, right? Like, there's no, like, underwriter or some banker saying, well, the rate is this, and it's really like— it's just a beautiful thing to negotiate that to me and have it work for everyone. And they're getting— actually, they've had this asset they've managed, and they actually get passive income from this asset they've been, like, holding on to.

Yeah. Yeah, real income, and they don't have to deal with it. And that's the other side of the seller carry that like most people love, is that it's an asset that they already know really well, right? And so like, hey, instead of giving a loan on something you don't know or investing in something you don't know, like you're giving a loan and investing in a property that you already know really well. And so then the only question is, do you trust me? And so at that point, it's just telling a story. And having the reputation. And a huge part of, you know, my reputation has just been built on the back of Gabe and Trevor and Mark. And then, you know, now I'm probably at the point where I could go do smaller deals by myself, but I, you know, there's not a huge incentive to. And so it's kind of, I'd rather just keep climbing up with, you know, with the partners that I have, because Gabe doesn't want to go, you know, buy small deals. He still would, but only if we did everything. And, you know, that's— we've done that on some stuff, but only when it's made sense and been like no money down.

But anyway, so, you know, I think seller carry— I just want to go a little bit deeper on that. Like, like, I think it's a beautiful thing. It's really simple. It took me a while to kind of really understand it and all the nuance of it. And everyone, it's taught in a different way. And I think sometimes what people do is they see a property is free and clear and they just come out with that like instantly without getting to the seller or understanding what serves them best. So do you have tips on that because I think that's what people do. And of course they say no, they don't know who you are. They don't know you from anybody, right?

Like, yeah, no, I mean, the specific to commercial deals and seller carries is it's all relationship based. And people like, people will say that over and over and then you'll still forget it and you'll still be like, well, it's a numbers game though. Like I'm investing and it's like, no. Two of the deals that we did this year. Were only based on the fact that Gabe had had a relationship with the seller for the last, like, decade. Like, one of the sellers wanted Gabe to buy their property because they knew that Gabe would hit the price that they wanted, and we just had to structure it right. And so they gave us a great interest rate, great terms, we gave them a great price, and it, you know, works out for both parties. But it's because they knew Gabe already. And so The biggest thing on a seller carry is you're right. Yeah. Don't just send the offer. Have the conversation. Like the deals that we have made work are when we get to the point where the seller really knows us, really likes us, and really trusts us. And so it's, it's just a lot of conversations of saying like, hey, this is what we do. Like, this is how we want to buy the deal. We can like lowball you just like anybody else, but we can also structure it in a way that could potentially be favorable for you. Depending on what your needs are, right? And so for some sellers, it's, you know, different than others. On sellers that don't need any money right now, it's, hey, well, let's just— let's do as large a seller carry as we can. And they say, well, I, you know, I, I'd like to do the 20% down, because that's like a reflex answer because they've heard it first. And it's like, why, why do you want to— why do you want to do that? It's like, well, it's just I want to know you got some skin in the game. Skin in the game.

It's like, here we go, like, how about a whole arm and a leg?

Yeah, no, There's nothing that I dislike more than that line. And in our mind, the skin in the game is the personal guarantee and the reputation. And so that's a huge thing that we kind of back up to is like, hey, I know me personally, and then I just tell the story of Gabe, right? It's like, Gabe's been doing deals for over a decade now. Gabe's bought, you know, give him the portfolio description and say, like, Gabe— Gabe's got skin in the game by just putting his name on it. Like, Gabe's never defaulted on a property. Do you think that the first loan that he defaults on is going to be this 12-unit that he's getting a $1.5 million loan from you for? Like, I don't— you know, it just doesn't really make sense. And then, like, when they start thinking about it, you're telling this— you're crafting the story of, like, well, no, that doesn't make sense. That's not how this story ends. And so That's a part of like the relationships. People think in stories. And so you're, you're crafting the relationship through a story. And that's what Gabe did to me was like, Gabe's telling me this story of how he did it all. And then I'm going like telling the same story just about Gabe to other people. And, you know, the same thing is true with Trevor. It's like, hey, we're young guys, like we're working all the time. We've paid off all our debts every time we've had like bad debts at least. And then, you know, we're not late on payments. Like we've improved every property we've owned, like here's some examples of properties that we've purchased and then what we've taken them to. And people are like, oh shoot, you know, like, I, I actually, I can see why somebody would do that. And you're telling the story of the other sellers who were satisfied with it, like, hey, this is— for your initial one, it's hard. Like, you really, if you want to do a, a seller carry transaction on your first property, you it's helpful if you already have the relationship with the person, or it just takes longer to build the relationship. And then you're, then you're banking on things from your, like, work life that aren't necessarily, you know, real estate related, but it's character related. And so you're saying like, hey, here's how I built this business, here's how I climbed through the ranks of, you know, Intel and whatever, got to where I was making $250,000 a year. I mean, whatever it may be, but like you're telling a story of character. So again, they know, like, and trust you. Trust being the hardest one.

Yeah. Yeah. That's so true because I think that's— that is such a reflex. And but it really comes if you can tell that story. That's how we're— and yeah, you— I think you just— you can't take that at face value, right? You have to kind of dig deeper. And that's the same with sales. I'm learning that sales is like the why behind the answer, right? The pain points or whatever it is and unpacking that and knowing like Right, what did— what are their— what's their goal for— they usually don't want a 1031, the stuff in my experience. Or sometimes in there, I'm not talking more single family now, right, but they're, they're out there doing the gutters and it's like their kids don't want nothing to do with these properties. And, you know, like, so totally, yeah. So that's how you get it. So it's just, it's a starting point and then you're unpacking it. And then, so, but what point— I mean, you're pretty far along in the relationship before you— I'm assuming you make a proposal. And with commercial, or how— what's that timeline?

Ours, it It depends. And so, like, if we know the seller's motivated, then we're doing it on the front end. If we don't think that the seller's motivated, frankly, like seller carry, unless the seller already knows that they want to do a seller carry, or if it fits their situation really well, where it's like the first property that we, you know, that we bought is maybe the best example of like self-managed for 40 years, a portfolio of like 100 units.

Self-managed?

Yeah. And did all the work. They didn't contract out like anything other than— I mean, I think they contracted out some of the trades, plumbing, electric, like, but they did a lot of that stuff too. And all of the simple work, or simple being just like easy labor to learn for 40 years. And it's like we're talking to these guys who are like 55. And the moment I got it, like I heard their kind of side of it, I was like, oh, this is the one. Like, this is going to be a no-brainer because they're still going to get the same thing that they've always had and wanted, which is passive income. They're going to get a friendly check upfront and then, you know, they don't have to deal with it anymore. And so it's like those are the three— like nobody wants to deal with it. Everybody wants a little bit of money in their pocket on the front end, usually. Just because it's nice to be like, I'm gonna go, I'm gonna go redo my landscaping, right?

Or whatever. I mean, I don't know, I feel like you got some, like, an exchange happen, right? Yeah, it's still a win.

And then, and then it's also like, hey, here's what you're gonna get every month just in the mailbox.

Like mailbox money, right?

Yeah. Oh, they love it, they love it. And so it just varies a ton. Like, and on deals that, like, if we see a deal hit the market that, like, we really like the deal, don't love the price, because we think the price is high, then we'll offer— I mean, we'll, we'll talk to them immediately. Not offer on it, but like verbally offer, say, like, call, call the broker and say, hey, here's what I want you to present to the owner. I'm going to send it over in an email too, because you're not really going to want to present it the way that I'm describing it. But essentially, this is— these are like the 3 ways that we would purchase the property. The seller's least favorite, frankly, is going to be the lowball on the front end, which we like, because then it's priming them to take the seller carry. And then we just wait 6 months. Like, well, it sits so many— I mean, not— yeah, it's just like, if, if somebody else buys in the meantime, awesome. If they don't drop their price though, if they're, if they're fixated on price, then that's when we a lot of times get the deal, is when they have a price that's 10% over what it should be to, to actually sell it, and they won't go lower than that. And it's like, shoot, yeah, we'll pay that price, just give us 10 years.

Yeah, yeah, it's all like that dial, right? You can adjust the terms, and if you're paying terms, like, you can pay more. I feel like you can pay more because you're not Yeah, hunting down the capital. Okay. Well, yeah, that's skin in the game. That's— I'm like, here it comes.

Get in the game. Yeah.

They want 50% down. And I'm like, on a single family, that doesn't pencil. Why would I put that much? Right?

Yeah.

Okay. So that's really interesting. So I guess, I mean, commercial is very different. Do you— it's someone like— here's the thing, like, I'm a big advocate, get into real estate. And I feel like there's this window of getting into small multi as your house hack. Like, so Do you think you can do that with owner carry? Is that too much of like everything together? But I just feel like there's this window right now with the lending options. So what would you say to someone that's starting out? Maybe.

Yeah, well, I mean, we say it every day. The, the other company, the team that Trevor and I run is called Vesta, and that's who puts on the real estate meetup down in Salem. And our whole, our whole goal of that is to get people who want to invest in real estate, like hopefully pretty bad, but just don't know where to start. And, you know, a lot of times don't have the time to figure out where to start because they're working on W-2 and have 2 kids and a, you know, husband or wife to hang out with and yada yada. Yeah, they've just got a life, right? And so it's like, my job is real estate. Like, I do this, I do this 8 to 12 hours a day, right? Like, I I enjoy it and I think about it all the time. So I'm obviously going to know more than you're going to know. Just let me help you. Just let me do it. And so our, our biggest thing to all those investors is house hack. I mean, house hack, what it's roommate or co-living, whatever.

I feel like there's all these rebranding. It's like really just having a roommate.

Yeah. I mean, really, it's just buy something, right?

Yeah.

It's not even a house hack. Like our whole buy small multifamily house hack, like like, yeah, sure, but if you can buy a fourplex, buy a fourplex. It's 5% down now. We can get the owner to carry a portion of it. Like, there's so many different ways to, to structure even residential deals. And that's why, I mean, we— I wouldn't suggest like trying to do the— trying to do creative structures on residential if you're getting an owner-occupied loan, just because there's a lot of regulation that you like the average person won't know. And so we have a good knowledge of it, which is why we're comfortable with it. And we're not doing anything that the bank isn't okay with. And a lot of times we have to get the bank to sign off on it. Like we're doing something where the owner's carrying a portion and the bank is saying, yeah, we're good with that. Like you can throw a second in place. It's just a line of credit. I mean, that's effectively right. Like the bank doesn't say no to HELOCs.

Right, right. But you have to do it the right way. Yeah, yeah, yeah, yeah, yeah.

No, you do. And so, and there's, there's ways to do it. Right? There's ways to do it wrong.

What's the wrong way? Not getting, like, approval or getting—

yeah, not getting approval, doing more leverage than they would actually want you to do, or like put on it. I mean, that, that's, that, those are like the biggest two. Some, some banks just won't allow seconds, and so getting it signed off on is, is important. I mean, the, the wrong way is just not getting it signed off on or over-leveraging it. And so, and it depends too, because sometimes you can have higher leverage if the seller is giving a lower interest rate because they're basing it off of DSCR.

Oh, right.

And so, and so then the bank says, as long as they're not— they don't really care about LTV as much as they care about DSCR on certain assets, right? If it's a single-family home, that's not the case. But if it's a fourplex, like, that is the case. And so it just varies. And so I would say, like, getting into your first one, It's just we— I mean, sit down with Shona or sit down with Dane or sit down with Trevor, sit down with me or sit down with Trevor and like reach out to somebody who already owns stuff. And that's going to be the easiest conversation where it's like, well, here's what I've got going on. Here's what I make. Here's like where I come from. Here's how much money I have saved up. Because a lot of times it's getting a, you know, a gift from a parent. We do that all the time. Parents are typically pretty happy to do it. Because their kid's investing. I mean, it's just the parent investing in their kid's future too. And so it varies a ton, but I would not suggest trying to get a seller carry 10-plex for your first deal. It was a lot of cold calling. I mean, that's the— is people are like, oh shoot, like you just like talk to the right guy at the right time. And it's like, no, like, yeah, I did. The only reason I caught him with the right guy at the right time was because I called 1,000 guys at the wrong time. Like, I called 1,000 ladies and gents who did not want to sell a 22-year-old their property. Yeah, what is this moron going about? So I, I, yeah, I mean, it's simple. Like, it, it's, it's simple but not easy, I guess, right?

That's just weird. Like, everyone's like, real estate's so easy. I don't think— I've had so much coaching and done so much, invested in education personally, and I still learn something every time I talk to someone. So Yeah. I, and I love when I heard your, you know, your presentation at the event. I'm like, that's brilliant because you're educating people. And I, you know, I go to these networking events and they're like, they want to buy an investment property. They don't even own an owner-occupied. I'm like, that's where you start. Like, I love that you guys are, you have an education piece because, and also an investor-friendly agent because a lot of agents, they're not trained in investing. That's my understanding. That's not, no, they're not going to like underwrite it or know what's a good deal or like think about.

So no, underwriting is not part of the real estate education course. There's like 2 pages on it and it's terrible. Like there's nothing. It would not teach you anything. No, I, yeah, I mean, I still buy, like I'm, I bought a fourplex this year. I'm gonna, I'm about to be under contract on another duplex with my owner-occupied loan because there's no reason not to. Like, right.

Yeah.

That's like, that's like what I'm doing at night. Like I view my day job as commercial real estate and brokering. And then at night, like I'm ripping offers on, you know, properties that I think have a little extra space to build on. And like I can also owner occupy with a 2 to 4 unit loan. Like that's, you know, and I send an offer where the owner gives me the down payment. And so that's like practice what you preach, I guess. That's, I feel, I feel good about that one is it's like, I'm not telling you to do something that. Like, I think is just the easy way for me to catch a broker fee. It's like, dude, even if I didn't get paid, I would want you to do this thing. Get— get— like, have somebody else broker it. I don't care. This is what I think you should do, and I would love if you used me because I give you the most value. And like, I'm gonna know how to underwrite it the best, right? Like, that'd be awesome. If you don't, yeah, use your uncle. Everybody's got a brother or a sister or an uncle who's a broker. Like, But I think that we create the most value from the investor-friendly perspective. And like, it's what I do every day. Like, I'm doing it right now. And so I'm not— it's not me telling you to do something that like I think is potentially good but isn't something that I myself would do because I don't like the hassle of having to move into a junky little property and whatever. Like, I don't know, I don't like that. I— yeah.

Anyways, you know, and I think a bad deal is worse than no deal, right? If you get into— if it's the bad location, like right? That's the thing.

Yeah, no question. No question. I, and I was not of that mindset at the start because I just wanted deals. But I think that that is potentially one of the worst things that we do as real estate investors is use the word deal. We use the word deal for everything. A deal is what we use to define any property that's potentially for sale. But that's not what a deal is. Like, a deal is, oh man, I'm going to make money on this thing.

Yes.

Here's how I'm going to make money.

Totally.

And until that point, it's a property for sale. It's not a deal yet.

It's an opportunity or something. Yeah. Yeah, you're right. We throw that around.

A deal, though, right? A bad deal is nonexistent because it's not a deal. It's a bad transaction. Like, yeah, you did a bad transaction. You shouldn't have done that.

Yeah.

And at the start, I was obsessed with doing every transaction no matter what. And some of the transactions were good, and the bad ones thankfully didn't go through. And the only reason they didn't was because I had good partners to be like, dude, that is not gonna work. Like, you're gonna— we're— we— if we did that, we'd lose so much money. I'd be like, whoa. And I mean, sometimes that happened on properties that like I'd already put under contract because I would like write the offer and they trusted kind of my underwriting within there. Like, that's not how that would work there. Like, that's how it would work if it were in Salem or, you know, this area of Portland. But that's not where it's at. Like, and you don't understand affordable housing, man. We went under contract on it. Yeah. Anyway, we dropped it. We didn't buy it, but not, not due to any of my wishes. I mean, I've, I've been pushed out of many a bad transaction because of, because of good partners. Yeah, no, no deal is much better. And frankly, like, almost any residential deal is going to be a good deal just because of the 30-year debt. Like, you're getting a 30-year mortgage on it. And like, one of the deals that we were looking at was— would have been good if the debt was one of the transactions we were looking at, I guess. I can't back myself out of that now. Properties we were looking at was like, would have been a good deal if we had got— if we could get better debt on it, but it was 5-year debt and then it was going to balloon and there was no like reprice. And we just couldn't— like, we couldn't make it make sense on 5-year debt and nobody else would really give a loan that made sense on it. And so like, you know, now if we were to do it, it'd probably work we actually— the property I'm talking about, we were under contract on like 2 years ago, and we're about to go back under contract on it because the, you know, the timing is just better. And so sometimes it's not— sometimes, a lot of times it's a debt thing. And so the, the residential debt with a 30-year mortgage on it, it's like, if it makes sense today, it's gonna make sense in 30 years. And if it doesn't make sense then the United States has bigger problems anyways. Like, then it's— well, then it's a currency issue, right? Like, something else is falling apart and you actually don't care that your name's on title because it doesn't matter anyways. So, I mean, that's my take is like, if it actually over a 30-year period— because we don't have an example of this in U.S. history. We have— there's 3 10-year consecutive periods since the like 1800s where the late 1800s where the U.S. stock market has been negative for over like 10 over 10, right? And it's like, it's been by a very small amount. I can't even remember when they were. But moral of the story is like 30 years hasn't happened. And we only really see tightening of the cycles right now, not an expanding of the cycles of the economy, because of technology and the speed of transactions. And so I don't see a world again, where 30 years from now, any any real estate has done anything other than double in value. Yeah, I mean, double in 7 years.

Like, yeah, right? I mean, crazy. As I look at our owner-occupied, and at the time it was like, felt like a big number, and now it's like, it would be insane. Okay, I just thought of another, another— I'm gonna pitch another idea for your meetup: Deal or No Deal.

Yeah, we, we kind of tried to do that. Oh, you weren't— you, you wouldn't have been there, but we tried to do that where we like We, we put out 3 deals that either us or one of our clients had bought, and we got the clients to sign off and say like, yeah, you can pitch it out there that were all different structures. And then we just had everybody group, like get into groups, kind of like the mastermind and try to like say, hey, how would you buy this deal? Like, what would you do to piece it together? And we'd like, we like gave out the seller motivations and like the story behind it. There's a better way to do it though. It didn't really work it because everybody was like, well, I would just buy it half price in cash. And I was like, well, but we can't do that. Like, that was, that's obviously like, well, I would just have the seller give it to me. It's not helpful. We're trying here. We're trying to do a thing.

No, I went actually to an event, Power Players, and that was one of the exercises you get the seller. It's like puzzle pieces and you have the deal was done. You have to figure out how it was done and with create basically seller carry, right? It's a really good exercise because you role play talking to sellers and you, you know, there's a solution, you just have to like unlock it. And so, but the other thing I want to kind of underscore, whatever you want to call it, is sometimes we're just— I was taught that we're buying debt and the real estate and they're not necessarily this, they're not necessarily attached, right? Sometimes we're just looking for good debt or debt that's like, you know, I think that's something that, you know, we don't always think about it like that. I don't know what your take is on that.

Yeah, we always— it's yes and no, I guess, is the best way. Like, I, I agree with it in the sense that, like, once you have a portfolio, then you're just looking for debt. Because there's some projects that I, like, nobody should buy as their first project because they don't have the portfolio to support it. And like when you're in the growth phase, you can't have too much bleed, right? Like we're— I'm going to be in the growth phase of equity for the foreseeable future. And so everything that I'm doing is with the mindset of how can I, how can I force the most appreciation into properties with new construction? It's obvious because you have a piece of land and you're forcing appreciation through construction. With that, like heavy value add, it's still pretty obvious because you're improving the quality of the property like a lot. And then with some properties, it's just, it's, it's operations improvements and those are less obvious, you know, because you're trying to cut 5 to 10% off the expense ratio, which on a 30% expense ratio or 35% down to 25% is huge, right? Like that's huge for your bottom line. But like, to the, to the debt piece, if, if you have a portfolio that's cash flowing really heavy, heavily, like, and you have a bunch of equity, like, buy a bleeder. Buy a bleeder that you know is going to bleed for a year but then is going to like break even or cash flow even, and you've, you'll have forced a ton of appreciation into it. Like, we, you know, we have a, we have a property right now that's probably bleeding like— not probably, it bleeds like $10,000 a month. And like, if I bought that as my first deal by myself, I'd be underwater. Like, I couldn't. And it's— yeah, like, oh, that's awful. Like, I can't handle that, right? And but because like we have the partners that we have on it, we have the debt structured the way that it's structured, like that debt is tied to that asset because there's a line of credit to it for a million bucks.

Mm-hmm.

And so I agree in the sense that there's some deals that we've bought because, like, just because, like, outside of the property, we got 10-year debt at 3% interest only. And it's like, how could we not buy that? Like, how could we not do that deal?

I mean, are you buying it for the finance— for them? I mean, what I'm kind of getting at is the substitution of collateral, like maybe Keeping the debt and selling the property. And that was, that was when I heard that, that was fairly mind-blowing. It's more advanced maybe than people have heard, but that's where like sometimes you're just looking for debt that you can leverage into something bigger.

Totally. No, and that, I mean, that's exactly what that play was, was it's like, one, it works with this property. Two, we can improve the property just enough to sell it and then keep that debt and put it somewhere else. Or like, there were a ton of plays on that project specifically. And so like, we don't really buy anything with the one angle because it's like you're— if you buy something with one angle, you're gonna get trapped at some point. Not on every deal, but like at some point you're gonna get trapped. And so we like to have multiple plays on, on every project where it's like, well, yeah, this is a good deal if we do this, it's a good deal if we do this, it's a good deal if we do this. And frankly, that's probably what's like held us back from scaling quicker Not that I, not that I think we're like moving super slow, but like that, that's like more Doris. Yeah, but that's, that's one of the things that's like prevented us from doing some deals is it's just like there's one exit here and it's assuming that we make it 10 years and it's, that just feels gross. And so we've avoided those for the most part. Yeah, the substitution collateral will come into play at some point. We're not really there yet because we don't love the idea of selling properties. Yeah, we would, we like, we would, we would do a substitution of collateral if we could, if we could do it and keep the property in pretty much everything we have in the portfolio right now, just because there's still a value-add component. And frankly, in Oregon, like if you're in the equity growth mode in the state of Oregon, and you have a property that still has value-add potential, then you should keep it. Yeah, you should keep it, add all the value that you can, and then sell it. Once the value-add potential is gone, if you can refinance it and pull out most of your equity—

exactly, yeah, yeah, like do that.

But if you're not in a position to refinance and you just have a ton of equity trapped there, get out, you know, and go, go buy something that has more value-add potential. It's really like the, the velocity of capital is a term people use a lot in commercial where it's like, how quickly, how quickly can I get the equity in a project to double and then move it to the next project or double it again in that project if there's a way to do so. But that's kind of the way that you have to think about it when you're in growth mode. When you're in cash flow mode, it's a whole different thing. You're investing for a different reason. It's preservation of capital instead of you know, instead of growth of equity. And so those are like separate ideas. When you're under— well, not even when you're under a certain age— when you still enjoy the equity growth part of the game, keep doing it. Like, that's, that's my take on it. Like, I don't have a number in mind. I just have like a, once I'm not having fun anymore. Like, I enjoy the job.

Yeah, right.

You know, I have fun. Like, writing offers and putting together deals and like working with clients on deals, like I still enjoy it. And so, and I'm super young, obviously. I'm nowhere near the point where it would even make sense. But like, I didn't get into it so that I could retire. Like, I got into it because I thought it was an awesome job and it led me to a path of, you know, potential retirement. But like, what, you know, what's my number? I don't, I don't have one.

And when I hear— oh, I've heard, I've heard a lot of people say they're retired and they're actually still working. I think it's more work is optional. And that's what I think, because I like love. I I love this game. Like, I want to be like, I, you know, it's optional. I don't have to, but you, because you enjoy it, doesn't feel like work, right? I want to circle back to something you said quickly. You said you're making offers for owner-occupied where the owner is bringing the down payment. I'm assuming he's carrying back a port. How do you position that? Because that was really interesting.

Yeah, it, well, it, there's a, there's a number of ways to do it. One of the ways, which is like the dumbest way for people to suggest that other people do it is to say put a lien on another property. It's dumb because the prerequisite is having another property with equity in it. It's like, yeah, that's a great idea. When people say like the easiest way to make a million bucks is do XYZ and it's like, so the easiest way to make a million bucks is have 5. Have like, yeah, okay, well cool. Yeah, I could probably do that too. Like, I agree. Let's make it reasonable. So the easiest way outside of that for us, the way that I structured it right now is to use the, my broker fee. So I can raise my broker fee and then use that as the down payment. And not, well, I've yet to find out whether or not I actually have to take his income. I don't believe that I do, but some voices have said that I might have to. So we'll see. And the CPA will be the final decision maker because I'm not signing off on that. So I think I can use my broker fee. So Oregon actually changed that law last June so that brokers can use their broker fee as a piece of the down payment as part of the transaction. So it's like written into the real estate transaction as opposed to like used to, you could like kind of fudge it, like bring in the money or, you know, and then turn it around later, pull it out like there were ways around it, sort of. But now it's like, no, go for it. Like, you can, you can use it to go occupy your own house. Awesome.

So you're doing own— because you're an agent and you're owner occupying in that. So that, that is brilliant. I've never really heard— so an agent, like, that's the benefit of being an agent, essentially?

One of them. Yeah, it's one of them. And I mean, the other way that you can do it is with, like, you can do it with seller credits. That's a little little less— banks not super stoked about that all the time. Okay. And so kind of bank by bank, I wouldn't really recommend it. If it's, it's outside of escrow, then it can't be a part of the transaction, and it just has to be an agreement between you and the seller. Again, like, I wouldn't do that just because you're doing— you're getting a loan that the bank's not telling you about, kind of, uh, or that you're not telling the bank about. I mean, kind of. And so that's not good. You can't— it's outside of the— it's mortgage fraud, technically, I think, depending on the loan docs. So I'm not— I don't get in trouble for saying that, but it— yeah, it just varies. And then the other piece would just be to get a seller second. And so if the bank will allow it, a lot of times that's better because you get rid of PMI. And so if you can get the seller to— if if you have 5% to put down and the seller will carry 15%, then you get rid of PMI on the front end because you don't need the PMI because the bank is only levered up to 80%. And so that's a— I mean, that's a good strategy just to lower your payment too, because instead of getting a 95% loan from the bank at 7% and having PMI, all of a sudden you lose PMI and you can get the last 15% of the loan might be at like, might be at like 4% because that's what you negotiated with the seller. And so then you're like, actual cost of debt is lowered. And then you also, you know, save $300 a month on PMI. So in the end, you might end up saving $500 a month, which makes a property go from not cash flowing to cash flow.

Yeah.

Or just like bleeding to breaking even. Yeah.

So yeah, that's really— I, yeah, I've been on the fence about being an agent right now. I'm not. I like being in this. Gray area.

Yeah.

So I kind of want to like wrap this up with like a call to action, like be in the right rooms, add value. Like, because I get, I'm sure, I mean, like, so how someone's starting out or like you, you put yourself and you've, you've had coffee, right? That like whatever you did, like how would, how that's clearly was the catalyst, right? Or also motivation. What would you tell someone to do that in a way that's like kind of giving value and meeting people and networking, because like that really propelled you, I guess, is what I'm trying to say. Yeah, it sounds like—

yeah, no, it certainly did. I mean, I met Trevor, my initial business partner, because I messaged him on Instagram because he had bought a deal with no money down and he posted it on Instagram. And I said, I want to take you to coffee to figure out how you did that. And then he explained it. And then I met Gabe because I asked him to go to lunch with me because I saw that he had a huge portfolio and I wanted to have a huge portfolio. And so like The, the, the call to action is just saying like, create a, like a really clear vision about what you want and then find the other people who are doing what you want to do already, who are already way further down the line in the game. Like, it was like, I was looking at where Gabe was at and like Gabe's whole mantra. And when I sat down and met with him at lunch, the big, the thing that he said to do to build his portfolio was make friends and have fun. And, and he is dead serious.

That's very complicated.

That's his whole motto. That's how he runs business. He says if you're making friends and having fun, you're gonna do the things that you want to do, and people are going to enjoy doing it with you because they want to be around you. Yeah. And that's like, it's— and I was like, well, that's not how you make money. And then it worked. Like, then I was like, well, I want to be friends with Gabe and have fun with Gabe. And so I'm going to bring him deals, like, because I want to be more like that guy. And so, I mean, the, again, the biggest thing is creating a vision of what you want to be doing in 10 years, like a real, a clear vision of like, here's my goals, here's why these are my goals. It can't really be backed. It, it can be backed by monetary things as long as there's a reason outside of the money, which is like, I want to be able to to support my family, and I want to be able to support my extended family, and I want to be able to support like other, you know, like charities. I want to be able to give a bunch of money to charity. Like that— those are driving factors that can make you just say, I want to make a lot of money, but here's the thing that actually like is being fueled by that. But then find the people who are doing it. Like Gabe is one of the most charitable people I know. Like Gabe is giving away money all the time because Gabe likes making money but doesn't really care about having money. Like, he likes toys, I'll give him that. He's got some cool cars and like a couple really cool watches, but like, at the, at the scale that he's playing the game, he's not spending very much money on that stuff. Like, he, he's really— he's giving back to the community all the time. Like, SMI's name is on a ton of stuff just because, like, charity stuff and whatever. I don't even know the best way to all the events that are hosted by different charities and different like nonprofits and organizations that are productive in the community, like SMI's name is on that because that's like, that's what gets Gabe going. Like that's what gets him excited is like supporting Salem. Like he loves Salem, he loves the people in Salem, and he just loves like helping people. And so he crafted his vision around that and then said, what do I have to do to get there? And, you know, started started doing all the things because he was surrounded by people who had way more than he had. He met a guy whose portfolio was huge, and then he said, well, here's how he did it. Like, I'm just gonna hang out with this guy as much as I can. And so, you know, back to the thing where it's like, I don't feel like I'm doing that much. You shouldn't. Like, if you feel— the, the nature of doing more is not feeling like you're doing enough. Like, if you already feel like you're doing enough, you're not going to be motivated to do more, right? So when I'm around Gabe and I'm like, dang, like, look at, you know, look at where— what his lifestyle is and like how he got to the point where he can support it. Like, I need to do more. Not because like I'm, you know, failing right now. It doesn't come from a sense of like I'm failing. It comes from a sense of like I haven't yet accomplished what I set out to accomplish. And so like the, the, the call is just find the other people who are closer to accomplishing it or just on the same track. Like it does, I mean, Trevor and I are like, Trevor and I are 2 years apart. Gabe and I are like a decade apart. And not in terms of age, but in terms of like where we're at. Mm-hmm. You know, Mark and I are probably 7 years, 5 to 7 years apart in terms of where we're at. And so like, I'm talking to those guys every day, like all the time. I'm on the phone with all of them every day because those are the people that I would, you know, I like emulating. Like I think they have really good character and I also think they've created really good outcomes for themselves. So that's my super long call to action. Just hang out, hang out with the 5 people you wanna be like. I mean, that's the, you'll, you hear it over and over again and then you still hang out with a bunch of people that you don't wanna be like. Why do you care what those people think? Like, why do you hang out with the people that you don't wanna be like? You're turning into them.

Like, yeah, it's true. Yeah. And you, your bar is higher if you're around people. And cuz if you, if, yeah, like when you said that's not a, I mean, you're, cuz you're in rooms with people that have amazing portfolios. So that's really, I have one kind of question, maybe it's a little bit selfish. Like It's got to be a value exchange. And I don't mean that in a selfish way. I just like, sometimes it's like, if you're just starting out, how can you add value to someone? Does it bring them a deal or what is it to like be like, hey, I really want to work with you?

You know? So it varies and we're probably in, I mean, we're in different spots. You add a ton of value to people's lives. I kind of just talk to people all day long for fun. And so I, but I do, I mean, I say no or I say like I can't pretty often, but I don't, typically just say like no for the sake of saying no. I— there's a number of ways that I deflect like or force value out of it, which is like, well, why do you want to meet? Or like, why do you need to take a phone call? And then they're in the position where they have to explain. And then I can really genuinely say like, like when somebody, somebody will text me and be like, hey, I really want to, you know, start buying deals. Like I'm looking at XYZ. If it's not multifamily deals and if it's not like an owner-occupied deal like that I can broker to them or a multifamily deal that I can do with them, then I just say, yeah, it's actually not what I do. Like, and so for you, if it's not midterm rentals, like, I just— yeah, it's just not what I do. Like, and if it is midterm rentals, then you already built out the funnel to push them to the point where they have to create value for them, for you. And so like for us, when somebody is like, calls me, even when my friends call me, like I have friends who are good friends of mine who call me and they're like, I want to buy a 2 to 4 unit deal. And I talk to them for a while because we're friends. But then when it comes down to like, hey, let's meet up and like look at deals or like here, like they start sending me deals, then it's just like, oh yeah, that's actually— we have somebody else on our team that does that, and nobody gets mad about that. It's like, hey, here is the resource of the person who actually does this, and I can pretend like I'm gonna help you because I care about you, or I can send you the— to the person who's actually gonna help you. Like, that's how I can create value for you, is by not talking to me. Like, don't— because I'm not the guy— like, I don't look at that stuff all day long. Yeah, like, totally. And so, I mean, I, I really like I, I used to feel like I had to make something up, like I'm super busy, or like, like, I'm sorry, I have like 4 meetings right at that time, they're all scheduled on top of each other. And now it's like nobody, nobody has ever been mad at me because I was honest with them. Like, like, and honest in a kind way, but just genuinely like, one, that's not what I do. Two, that's not what I'm interested in. Like 3, I, you know, I don't see that leading me towards my goals. Like, and nobody's like, well, oh, okay. Like, it's so, it's so— it totally takes their guard down. Like, they can't, they can't be like, well, it should be of interest to you.

What do you mean?

Right?

Yeah.

Like, and, you know, or like, if it's an off— like, people try to bring us deals that aren't what we buy And I honestly take that as one, like a compliment because they want to bring us deals. But it's like, yeah, dude, I actually don't need, you know, office space in San Jose right this second. Here's what I'm looking for. And so then it's just turning it around to like, oh, it's actually my fault because all they knew was that I bought deals. They didn't know what I was buying.

Right, right.

So then I just say, hey, dude, my bad. Like, I didn't update you on what our buy box was. Really appreciate you looking for this thing. I'm not going to underwrite it. Like, I'm— that's— I'm not even going to look at it because it's not what we're buying. But here is what we're buying. And like, maybe some— maybe I know somebody else who's looking to buy what they have, and so I, you know, shoot them a contact. Sure, then I can create value at really very little time. But outside of that, it's just like genuine, like This is what I do. This is why I do it. If it doesn't fit in there, like, oh, like, I'm like, that's just not something that I'm really working on right now. Like, just tell them. I don't think people— I think we have this fear that people are going to get mad at us. Yeah. It's like we— because we're like poo-pooing on their idea.

Yeah.

No, no, no. Like, I think that could be awesome for you, but like, I actually don't really want to go get coffee and talk about it because like, I'm not trying to, you know, start that thing right now. Like, I know what I'm doing. And people, a lot of times, it's— they're happier because you said that, because then you didn't waste their time either.

Like, exactly.

And then also, they're, you know, it's cool to them that you know exactly what you're trying to do all the time. And if that thing doesn't fit in it, then they're like, oh wow, yeah, he's really, you know, they're dialed, she's dialed, like, she knows. So I don't know, that's, that's probably that, I guess.

I, and I think I'll say too, if some go to in-person events, like if I'm at an event, I'll talk to anyone if I'm there. And you're, and you show up all the time, like, and I don't think anyone doesn't feel awkward at an event, but you show up, you're part of the community, anyone will probably answer any question if you're there. Yeah, you're not making an extra trip to get coffee. And that's where I'm like, hey, if I'm there, ask me anything. I'm sure you feel the same way, right? If you're at an event, someone asks you something, just because there's, there's kind of skin in the game by showing up, right?

Yeah. Yeah, yeah, no, there certainly is. I'm in the same boat. I mean, and there's something like, I'm going to talk to you longer than I'm going to talk to other people, but, but I'm certainly going to talk to everybody and then, you know, I'll answer whatever questions you may have. The funny thing too is like, I don't know if you feel this, but I feel like I end up asking more questions than I get asked at events a lot of times. I don't know what that's about, but It's like I'm asking somebody who's showing up so they can learn how to buy real estate who doesn't own real estate. And I'm asking them all these questions about like their job in HVAC and it's like, yeah, well, I mean, I don't know, it's interesting to me. Aren't you here to like buy deals?

Buy deals.

Shouldn't we talk about that? Like, I'll answer whatever questions you don't have.

That's funny. Yeah, that's interesting. Yeah, I think in person, like it's pretty— and you kind of, it's clear if there's like, I met Gabe and I was like, this is the best conversation stage, and then someone cut in. I was like, oh, I really— I chased him down after him. I can't get your number because it was clearly just doing like very— and he was just easy anyway. So the point is, like, go to events, right? That's the best way. And I think that if you show up more, you're like recognized. If you have a deal, you're not some like someone just stalking Facebook posts, right?

Yeah, yeah, no, totally.

All right, I know we could go on. I'll start wrapping this up. So a couple wrap-up questions if you have time. I always go over on these things. Okay. Thank you for all this great, this conversation. Top business or life advice you'd give someone to live life on their own terms?

This is gonna sound so dumb, but it's true because I wasn't— I didn't do it for a while. It's tell the truth all the time. And so that's this— it's the same thing with like, how do you not meet up with people who you don't think are going to give you value? Tell them the truth. Like, how do you, you know, how do you get out of a Like when we're under contract on a deal and something goes wrong on our end, but we like are scared that if we tell the seller, like we're going to lose the deal. Tell the truth. Like I— and so like we do— I do that in brokerage now. I do that in relationships. I do that in like there's never— nobody's ever— this is a Jordan Peterson line, so I won't, I won't credit myself to it, but nobody has ever lied and gotten away with it. Is what he says. And like, when I first heard that, I was like, well, that's dumb and it's not true. Um, and then the more you like dwell on that line, the more it like eats you alive. Where it's— I mean, it's— nobody's ever lied and gotten away with it. And it's like, maybe the person you lied to didn't find out, but it ate you alive. And like, it didn't benefit you because you lied to them in the end. Like, and so, I mean, there's, there's no scenario. I don't, not one that I've found where like lying has helped me be more authentic or has helped me. And like, I'm not trying to be like a moral, like I still, I'm sure I still lie. Um, but I do my best not to. And it, and, and part of that's not even like just lying, but it's like, don't deceive people. Like, don't mislead people. Be as Gabe. And that's what— if I look at Gabe, it's like the reason that Gabe has gotten where he's at is a lot of things, and a huge part of it is that Gabe is Gabe all the time. And Gabe does not change who Gabe is for anybody else. And it is electrifying when you're around him. I mean, you met him, right?

I was just like— he was— and I didn't know he was such a player. I was just like, hey, you're interesting. It's like, yeah, no ego there, right?

No, not at all. And like, because he doesn't— like, he's just being him. Like, that's— and there's— Gabe's not trying to prove anything to anybody because Gabe is happy with who Gabe is. And frankly, the more— the more you start telling the truth, the more you start being happier with who you are, because it forces you to reconcile, like, your, like, truth versus your reality. And it's like, if I'm if I'm saying one thing but doing the other thing, then that eats you alive. And so you start being more of who you want to be by telling the truth. And it's like, well, if I want to be this person, then why do I have social media and scroll for 3 hours a day? Like, if I say that I want to be this person, right, doing another thing. And so it's like being not only telling the truth to everybody else all the time, but telling yourself the truth. Because if you, if you really want to be that person, that person wouldn't do that thing, and you know it. And so you're either lying about wanting to be that person, or you're lying about being okay with the fact, or like how you think the person is actually supposed to get there, like how you become that person. It's like, well, this is part of my hero's arc. Like, I have to, I have to get to the low point so I can get to the highest for And it's like, no, it's like, you really think— like, if you really think that's true, maybe, right?

Maybe.

But I don't know.

But that's like the best answer I've gotten, by the way. That really— I mean, everyone's like, take action, which is great, but like, that is very much big. And I just— from a really tidbit, like, the more, the more authentic I am, the more like I'm like— then I feel like I can connect more and I just stop caring. I'm like, this is— I'm not going to pretend. Or if I'm talking to Sal, I'm not going to be like, I'm all buttoned up now. I'm just like myself. I just like You don't have to fake anything.

You don't ever have to think about how that story connects with the other thing that you told. There's never like, there's never an explanation for a thing you said earlier or like, you know, a person you were at another time.

Like, yeah. And it's easier to connect if you're just being honest about your flaw or whatever it is, or not trying to pretend like, yeah. So that, that was, thank you. That was really inspiring. Okay. Your most valued personal or business asset.

My most valued person— this has to be a physical object.

No, I mean, I think relationships, right? Whatever you consider. I mean, that's kind of a tongue-in-cheek question. However you want to go.

Yeah, yeah, yeah. That's— what is, what is the— yeah, the genuine answer is probably the friendship that I have with my business partners. Specifically Trevor, Gabe, and Mark. Like, the reason— it's funny, we all started working together and then like, it turns out that— it turns out that Gabe's a Christian too and Mark's a Christian too, which is bad that— I guess bad that I didn't know it on the front end, but we were just doing business on the front end. And then, you know, after not that long with Mark— Mark and I talked about it pretty quickly— and then not that long with Gabe either, but Gabe's a Gabe's a believer as well, and that's like a huge part of what drives him. And so that, that's probably what gets me excited every day is like knowing that I have good alignment with my business partners and that like my business partners are of good character. And then my relationship with my girlfriend, probably like the— those are, those are the 4 relationships that, you know, keep me fired up I would say, and I care about those relationships more than I care about any properties that I own. Yeah, just because that, that stuff, I can buy more properties, but I don't get to just have healthy relationships. That's something that I don't want to take for granted.

For sure. That is so, yeah. And I think being aligned, right? Values is— okay, I'm going to keep this moving. This is all a superpower on how you use it in business.

Superpower and how to use it in business?

How you use it kind of in your business or life or whatnot.

My superpower or a real superpower?

Well, I think, yeah, your superpower. Like a real one, I guess. It could be a fake one. Like, however you want.

I don't know that I— probably the making friends and having fun. Yeah. When Gabe said that, I was like, one part of me was like, that's dumb. And then part of me was like, wait, that's like all that I'm I'm good at. Like, there's so many people that are better than I am at math and like underwriting and operating properties and, you know, all these different things. But like, I really do enjoy making friends and having fun. Like, I— and I use that in business because all that we do all day long is build relationships. Like, that's all business is. And so the other stuff can all be figured out, but relationships are hard. And, you know, back to the answer to the other question, like, I, I do think that that's probably, probably my superpower is building relationships.

Yeah.

And I use it to build businesses and build partnerships that, you know, go beyond just a project or an asset or a, you know, system, whatever you want to call it.

Well, I think there is an energy, and when I'm— you had I mean, this sounds weird, but I think people are attracted to that and it's easy to be around and you want to be around someone that's kind of got that energy. And so I, I love that. I think we should all work towards that, right? That should be—

yeah.

Otherwise, why do we do this, right?

Yeah.

Big fun.

Yeah.

Okay, like a book or a podcast and how I kind of— how to work with you or reach out or, you know, your best, you know, all the ways. I know you have— yeah.

Well, I could send you the, the link to our to our page, but it's, it's vestasolutions.net. So that's, that's how we help people get into their first or next investment. A lot of the people that we help are buying their first deal, and the rest of the people are buying their, you know, second to 20th deal. And so we don't— we, we feel like we can help almost anybody. And so just having a meeting with us and we don't like, we have a course and we have underwriting tools, but we don't get paid on that. And so that's kind of the best way that you can connect with me is probably through that or go to the meetup down in Salem. You'll be able to find it on the Besta Solutions page. You can find us on Instagram again, Besta Solutions LLC, or Dane_MCK. I think. And then our podcast is Deal Junkies. You'll see it. It is— I think there's actually two Deal Junkies, but ours is the— ours is the better one.

Smart people on there.

So yeah, there's at least two, and then Trevor and I are— well, actually gave it— now there's three. Yeah, there's three smart people, and I'm on it as well. And there's a picture of 4 dudes' faces and then it says Deal Junkies in the middle. Can't miss it on Spotify or Apple. Perfect.

Yeah, well, I will put that on the show notes. This has been really fun. Like, I appreciate you jumping on. I know you're busy, but I just— yeah, it was great to connect in person. This was— I knew this would be fun. Thank you for your time.

No, thank you. I, I'm sorry for talking the whole time.

Oh, that's, that's kind of the point of this. If you don't like to talk, it would be hard to do.

Yeah, that's true. That's true.

I'm just the facilitator.

Okay, no, there is great questions. That was a lot of fun for me.

Oh good, awesome.