***Free Workshop*** Stop selling and Start Solving.

Just excited to share with you guys all the things that I have learned and what our business is doing, but more importantly, how to get you to the next level. Because I know this market has been a little tough for a lot of us, and there are so many opportunities in this current market, and it goes with any market. And that's. That's the ideal thing. Right. That's what we're talking about being market proof today. Because once you learn the things that we're going to go through today, there's no excuses other than how hard are you willing to work and how hard are you willing to grind. And that's really the key to this. The next real estate agent that I hear can't make any money, can't do any business. It just doesn't work right now. It does in any market, I swear to God. But it's a mindset change. So two more minutes because, you know, we're all in realtor time, which is usually 10 minutes late. Yep. While we're kind of waiting for a second, if everybody will type into the chat, you know, what city you in, are you local or you out of state, whatever that is. Because one of the things I want you to know is that a lot of the stuff that I'm doing, obviously, is in Phoenix and the things that we've done. But the theory, the strategy, the numbers, they apply to any market. The numbers only change as far as the value of the properties. But the theory that we're going to go through in that spreadsheet that you guys got yesterday in the email, it applies to any market. So just know that. Right. It doesn't matter the price range. Really interesting thought on this is like, you know, I know I've got one of my friends on here, Isaac, that's in Columbus, Ohio. Their price ranges are a little bit different. But here's the scary thing. The construction costs don't change, doesn't matter the price of the house, it all stays the same. So it is something that we have to plan and go through when we're doing. And that is the number one thing that I see. And if you guys have been watching wholesale deals or different things, the number one component that is missing that people don't understand is the actual cost to renovate a home and what the actual costs of construction are. So. So it is one of those things we're going to get deep into today so that you know it and understand it. And we've got some really cool rules of thumb to share with you that is just like Quick, easy. And the value to that is being able to share that information with your clients, your sellers. People are like, I think I'm going to remodel or I think I'm going to sell or I want to put this money into it. Do they really know what they're going to get ready to get into? If you had a chance in the email that I sent yesterday to go to that MLS listing, by the way, I didn't actually physically go there. I just pulled it up on MLS and the fix and flip. Throw one in the chat that you actually looked at that MLS listing, because that one, when I went through it, you're going to be blown away at what the numbers actually look like at that house when we, when we get through this. All right, let's, let's get fired up, okay? I've got some breaks planned in here. I know this is three hours, but guess what? If you can't stay for all of it, I understand. No big deal. You're going to get a replay of the video. I just ask that you go through it and just take some of these things and learn from it. Okay? So let's go. Soon as this thing starts to work for me.

All right.

My goal with you today is that we are going to work together as a community. This is not old school bullshit real estate. Old school bullshit real estate was back when my dad was a real estate agent or realtor and everything was closed off. Nobody was willing to share anything that they were doing and everybody wanted to get in pissing contests over their territories. That is not what this is. In fact, about 50% of the transactions that we do right now that we buy are from people just like you guys that have understood, we've worked together, we've gone through it, and they're creating income by solving problems for clients. And that is what our business is based off here at Limitless Real Estate Strategies. It's based on solving problems. And I fully believe that the larger the problem you solve, the more income you earn and, and the greater value you are to your client. And I think we can all agree want to be the greatest value proposition to our clients because we can solve problems. That is my claim to fame with my clients is give me the most effed up situation you can possibly imagine and I will figure a way through, around, over the obstacle that is in their way. May not be pretty, but there are options, right? If you win, everybody wins. Okay? By being here today, you're winning. By listening to this and learning this, you are winning. But More importantly, your clients are going to win and you are going to be much more dangerous for your clients than anybody else is in this business where we've learned the traditional side, but now let's go into the focus of problem solving, right? There is more than one way to earn income in this industry, and it took me 15 years to figure that out, that there's other ways to do this. And I believe that you are all fully capable of creating an extra 50 to $100,000 a year by understanding how opportunities work with investors. And the main goal is, is that once you see this and you start to learn it, because a lot of you are here because you're trying to increase your income and you may not be ready to invest right this minute, once you start to learn these philosophies and these strategies and these theories that we have put to practice, you will then strengthen your own ability to eventually start to capture some of these opportunities for yourself. And that is the end goal for me. Right? So if some of you don't know this, this is a really, really big piece for me. My dad died in 2015. He was in the industry for 40 years. He bought a thousand homes, a trustee sale for investors, and died owning zero real estate. And FYI, if you didn't know this, there is no wealth created in selling real estate the way we do it. Traditionally, the wealth is generated by the opportunities our real estate license has to give us and allows us to create, solve problems and create generational wealth. So that is the goal. This is just step one. And I'm not going to go too deep into those things because I really wanted you to get the base today of what we're looking at and how to structure the conversation with the seller, how to structure the numbers so that, you know, you're giving people real numbers. That is the nice thing that a seller loves when I walk in the door is that I don't have to do anything else after that meeting. I can give them my numbers, I can look at the house and I can know what it is, and I can show them what it is and why it has to be this number to make it work. Here's the great part. If that number doesn't work for them, then we go towards the traditional route. But we need to dig into the root of, of whatever the client's desire is. And that's what we're going to get into today. Just the way I operate so that you can operate in the same fashion, because again, every person is a different situation. There's multiple variables. And we've got to get to the root to figure out what their desire is so that we can help them. Which again, if you win, your client wins. And my goal is, is that I win as well, because we've acquired another property that we can either renovate or whatnot. And. And you have created income, you have solved the problem for your client, and now we are working together on a regular basis. Sound good?

All right.

This is what I want you to get by the time we leave here. So this is the framework. These are the things like write notes. I swear to God, like, this is going to change your life and change your business and how you look at things. Okay. Because as you're driving around with clients and you take this mindset, you're going to see something go, oh, that might be an opportunity. I wonder if I can negotiate that for Steve because he is always a buyer. Right. You don't have to be the buyer right now. You don't have to be the investor. Nor do you have to chase somebody down and wonder, are they going to do an inspection? Are they going to go through this? No, this is straight up. We can make this super easy, super simple. And if you know how I think and know what I'm looking for and know how we operate, makes it really simple for both of us. Okay.

All right.

I want to change your mindset about traditional real estate. You can create income not just from representing buyers and sellers. You actually create more income in the middle, which is, where do I solve the problem and how do I connect the dots? Okay. That's the mindset we are going to change here. And it's going to change because it's going to make you market proof. No matter which direction the market goes, there's always somebody that is died divorce just doesn't give a shit about their house. I bought a house this last week. There's actually a gallon of milk on the counter that has been sitting there for 18 months. The expiration date was February 22nd or February 16th, 2022. Pretty gross, right? Somebody just didn't care. That was a great deal. Right? It's going to happen and that's okay. But it was solving their problem was the bigger need on it. It wasn't putting it on the market. Questions to ask every seller as you go down the road. We traditionally go in as traditional real estate agents. Put a 2 in the chat. If you go in with like, well, it's probably not a binder anymore. That's what my dad used to use. That's what I used to use with an iPad presentation. And it's more about, hey, this is. These are. These are my experiences and this is what I can do for you. Right. We go in with that mindset and I want to help change a little bit of that by getting to the root and asking the seller better questions to see how we solve and give them options to solve for whatever their desire is. Knowing your numbers on every property. Here's where the real valuable piece is. No matter who you're talking to, whether it's a client that's thinking about selling, whether you know it's a buyer, when you're out showing homes, when you're looking at somebody else's flip, you are going to know these numbers and what it potentially would cost for a buyer to understand it, which gives you greater value and greater knowledge in this department. And it's really important to have this knowledge because I'm sure that some of you. I know when I first got into it and now that my wife is the contractor, I really know the numbers is you're like, yeah, I think It'll be like 15 grand and you're so far off and the buyers freak out. Right. So this is going to give you some great ideas and some great rules of thumb to go through things. It's also going to give you things to consider when you are out there looking with buyers and, and you're looking at other people's flips at where they cut corners in certain things. And I'm very, very particular when I'm out with my buyers, when I look at somebody's flip. And I will point a lot of things out that concern me as to how it was done. And it makes me a little uneasy as to where we are going with this property. I want you to be able to solve for any seller challenge that is there. Okay. There's so many challenges. And when you become a problem solver or a strategist, which is what I claim to be, because that's really what we do, there are times that you meet with sellers, like I did last night, where there are some different financial issues going on and there's ways around it to try to keep their house. May not result in a sale right now, but could it result in a raving fan and how we solved the problem and connecting the dots to solve that problem. One of the things that I wrote was, you know, in my post and the different things was how to increase your. Your income by five to $10,000 a month. I'm going to show you exactly what that looks like and exactly what my needs are and what I need you to see in the numbers to bring me those deals in order for you to create that income without having to put a sign in the yard, process listing paperwork, all the things that are pain in the ass. Okay. And I want to market proof your business. There's a lot of us that are struggling right now because rates are high. This is happening, all these things are going on. It's pretty cool to learn this side of it from where you're going to learn today and realize like, well, eventually I want to be my own buyer. Eventually I want to make my money. I don't want to depend on somebody else to create my income. I don't want to depend on these leads coming in or my team leads coming in so that I can feed my family. Okay. I believe that if you know how to fish and you understand the numbers, doesn't matter what market it is, you'll be able to survive and thrive in any aspect. Also going through this, you are going to see where my mindset is, where a lot of investor mindsets is. Some of you are working with investors and I'm going to give you kind of the insight as to what we're looking at. Risk, reward, cost of lost opportunity, all the pieces so that you can have better conversations with people. And when you have this knowledge, it also gives you the ability to have more conversations with your clients about, hey, have you thought about investing in real estate? I have these opportunities, I can do these different things. And again, it starts to grow legs in a different area of your business, which is really important. Okay. We don't want to be pigeonholed into one thing which is just a buyer and seller. You see, a lot of my clients are being led down the road of keeping their homes and buying another one and we're continue to move that direction. So I can take a first time homebuyer and turn them into one house and six sales over the next 10 years by guiding in that direction because I understand the investment side and I want all of you to realize that, that you're here now, you're learning at the very bottom. And the numbers are the most important thing. I would honestly say that our industry and I grew up in it, okay. I am 60 years of family experience in real estate. My grandmother was the first female real estate broker in Illinois. And here's the problem. My family, generationally, nobody understood financial literacy. We were good at selling houses and doing all these things, but nobody sat down like here's how this moves. Here's how this breathes. Here's how the numbers work. This is what you're investing in. This is what it looks like. We're going to get into that. Another, another topic down the road, but today, the financial literacy part is knowing the numbers and how to crunch them and how to have the conversation to get the seller to that point that it's solving their problem one way or another. Sound good? Y' all with me? All right. There are several of you that signed up for this that I don't know. And I am grateful that you're here. So I just wanted to give you a little tiny insight to me. I've been licensed for 25 years in Phoenix. I've been married 23 years. My wife is our general contractor. She runs the construction side of our business. I have two adult boys. They are adult boys. That's exactly why I said it. We have four dogs. I want a goat. I want a fainting goat because they crack me up. I want to walk in the backyard and scream at it, watch it fall over. I am an avid car collector. We have 12 of them right now. We own. Currently we own 92 single family rental homes in Phoenix. We flip nearly a thousand homes, all while doing about 100 traditional transactions a year in representing traditional buyers and sellers. I own and operate Limitless Real Estate Strategies. My clients and students have grown their net worth and their wealth by more than $30 million in the last couple of years. And I am still actively doing what you guys do every day. I just do it a little bit different and sometimes it's a little bit more fun, like expired milk cartons and things that we find in houses. So that, that's just a little bit about me. Here is the most important. I need to move some stuff here on my screen. All right. We are in the people business, not the housing business. Something my dad taught me early on. The bigger the problem we solve, the more income we will generate. This couple here, I'm going to briefly describe this story. Such a sweet couple, lived in a house for 30 years, wanted to buy a new build. This was back when no contingencies were allowed. Big non refundable earnest money. We were able to purchase their home, leave them in it, give them the earnest money for their new build, represented the new build, leave them in the house. Then we got the house. We flipped it after nine months and we actually flipped it in a lease purchase to somebody else. It solved their problem. Going down the line of solving their problem. Went from Listing their nasty, dingy house they had done nothing, and making a $12,000 commission to creating more than six figures worth of income by solving all these problems. That's what this looks like. When we get into this and we realize what the people need and showing them how the numbers work and what it's going to look like, how do we get to the root of the client's desire? You see, I believe that many of us are taught when we go into listing appointments, these normal traditional real estate questions, which is like, what do you think your home is worth? What condition is it in? Has it been remodeled? Tell me what repairs you've done to it, where do you want to move? Right? All the traditional things. Here's what doesn't happen when you go down that road you are not getting to. And some people ask, well, why are you moving? Some people won't really share with you, right? And sometimes we have to get to the root. So here's a list of questions that I go through. I'm going to give you the reason why, okay? In order for me to get to the root or for you to get to the root of where they need to be, I need to ask a series of questions to find out where they're at. And I do tend to tell them, like, hey, it's really important. I'm just going to walk around the house, take a look at it, and then I'm asking you some questions. Some of them might be personal. You can tell me you don't want to answer it, but there's a reason that I need to know these so that I can help solve based on the variables that we're dealing with. Okay? And again, this is not just creating the traditional sale. I want to know where the seller's at. Because believe it or not, we've bought tons of homes from sellers. That money was not the issue. Timing was. And the house was in really good condition. So not every house has to be trashed and missing the kitchen for it to be a deal. It's do the numbers work? And sometimes the sellers, we all have experienced this, right? We all thought that Zillow Opendoor Offer pad were going to take all of our business and they were going to be the end all be all and soon to find out they weren't right. So people still need those solutions. And while those things might traditionally be okay, it's not my go to right. I want to try to help the seller in that sense because they have all the red tape that they want you to run through in Order to get there. Right. And by the way, if you refer a client to Zillow or I guess it's Offerpad open door, you get a 2 or 3% commission maybe. To be honest with you, I don't even remember what they're offering now. But it doesn't always work out because of their inspections and their other things. So we've not had good experiences with it with our clients. So we don't go that route. So here's where I go and then I'll explain why. What do you currently owe on the property type of mortgage do you have? The reason I want to know what they owe on the property, because it gives me some sense is like, how close are we? Do they owe a lot less than the condition? Is those types of things the mortgage? I want to know because is there a potential for creative financing in this particular deal? You see, I might pay more money for a property if I can take over their mortgage. Or we can do a seller wrap or a seller carry based on those numbers. So there's other points than just price. But we have to know this information in order to see all the variables that are involved. What are your current payments? What's the net number you had in mind? See, I believe a lot of us in the traditional business, we try to trick a seller into, so what do you think your house is worth? Because it gives us a baseline. Are they crazy? Are they way low? Where are they at? Right. We try to take that temperament. When you ask the net number in mind, it's going to give you a starting point because remember question one, what do you currently owe in the house? Right. So now if you add that net number to what they owe in the house, you can kind of see approximately where they're at. Now you've got to add your commissions and some of the other things to it. But it does give you an idea. If you didn't have to sell the home, traditionally, you could have cash in 10 to 14 to 21 days. Would that be beneficial? It's a simple question, right? We're not going down that road of the investor yet. It's just a question, where and how will you invest proceeds from the sale if it's free and clear? I want to know if there's an opportunity to maybe do a seller carry or can I convert that person into a private lender to allow me to buy a house down the road? This is where you start getting into strategies and goes back to financial literacy. It's pretty crazy in the world that we Live in as you start having these conversations. We bought a house on seller carry last year. You know, they carried $500,000 for us at 6% for a year. Then when we sold it, I called them and I says, hey, you're going to get this $500,000 back. Do you have any place to put it? He's like, actually, we really don't, but this investment has been great. I'm like, hey, I have a rental property I'd like to refinance. Would you be willing to give me that same 6% rate on that rental property and put that $500,000 over there? This is where we start creating wealth and we start creating relationships. Because if we have these conversations and we understand how it works, we can help people and it solves their problem. And sometimes we get a little less price, we build a little bit more relationship. And now those people are constantly revolving money in and out of the company so that we can buy more assets or move things around. So it's creating that relationship and showing you care and really getting to the root of what it is rather than the. The necessity of selling something. Some of the houses we come into, you know, they might be hoarder house, or maybe it's mom's house that's just full of junk. And it's asking a question like, hey, does the family have time to clean this up and go through the repairs and do the things that need to be done to get the maximum price out of this? Or would you like to understand an easier solution that might make sense? Yes, you might be leaving a little bit of money on the table, but does it help you solve for the immediate need? Right. Have you considered keeping the house as a rental? One of the reasons I always ask this question is because it helps people see that I really have their best interest in heart where I'm trying to talk them out of selling the house. And sometimes they will ask, well, what does it look like? We'll explain, well, this is what a rental looks like. This is what to be prepared for. Here's the property management information so that they can see if it's a viable option. See, one of our goals should be is like, how do we help our clients be wealthy and understand the benefits of real estate and owning it? That is the key. This is not just a sales job. So I'm hoping that your mindset is going to shift on this. This side of things with the business. Like this is not just about sales. It's about how we strategize for people how do we help them build wealth? How do we get them to not only the goal right now, but their future goals? Some of them don't even know what their future goals are until we ask them about it. I bet right now, if I asked every one of you in here, have you thought about what your dream life budget is? Which is the amount of passive income, not money in the bank at retirement. I'm talking about passive income from assets that you own that will support you on a monthly basis. It's a question I ask a lot of my clients and we go through and I ask a lot of you guys in the real estate industry because I want you to start thinking, because I wish somebody would have said when I was 20 years old, when I got my license, hey, how much money at age 50 per month do you want coming in so that you don't have to do open houses on Sundays in 120 degree weather? Right. Majority of my students are somewhere between 10 and $20,000 a month. And then we reverse engineer. Well, how many houses is that going to take? Right? So sometimes I'm taking the seller or this client down that road of keeping as a rental, 90% of the time they don't want to do it. Right. There's a money need. That's why they want to sell the house. What is most important to you? Time or money? Some people, when they're like, I need as much money out of this house as possible in the quickest amount of time, maybe that's selling it as is on the mls. Maybe it's bringing that deal to me or somebody, you know, and saying, hey, this person really needs to get out. This is kind of their number. Is there anything we can work out right now we start working together. And by the way, I go on more appointments with agents than I do for my own clients because I'm there bringing the buyer to the table and I can have a different conversation with the seller and we can get to the root as to whether or not I can buy it or they're going to put it on the market. Right? And by the way, your clients are completely safe with me. I'm not looking to steal anything. I'm only looking to solve for. All right, here's what we're going to do. I've got four properties. We're going to go through two right now, and then we're going to take a break and then we're going to go through two more on these properties. What I want to do, if you have particular questions regarding this property or this scenario, throw them in the chat. Garrett will read them, and I will go through them at the end of each property. Sound good? All right. This was part of the email that I sent yesterday. And this is where knowledge is power and understanding numbers. And this is no offense to the agent that put this on the market. The numbers are so far off on this that it's actually funny, because if you read the MLS listing, it's. There's so much spread in this. There's all these things. So do you want to go through the numbers? Because this is where the fun part is. Now, this house doesn't have any pictures, but if you just read the description, it's got structural problems because they've gone to a structural engineer. It clearly needs a roof. It clearly needs windows. It clearly needs freaking everything. Right? Okay, here's. We're going to start. Rule of thumb, you're going to see this in the numbers. If a house like this house on Carroll needs a roof, needs windows, needs a sewer line, needs plumbing, it needs everything you can budget, without fail, 90 to $100 a square foot to remodel that house inside. Now, okay, when you get into roofs and ACs and windows and sewers, these are your big ticket items. They are the things that blow the budget the fastest that people don't plan for. And when you're looking at it, remember, if it's going to be a flip and it's going to be a resale, you've got to do these things because they're going to be a problem. And one insight that I have on this, not that we're talking about flipping homes, but like, on this particular home, we always scope a sewer line. And I suggest if you're representing buyers and there's a flip, you scope the sewer line, it's 250 bucks, and it's well worth it every time, because the sewer is the most hidden, common problem that we've run into and the most expensive problem that we've had. We've been sued once over it, and we had a client that rebuilt an entire house that burned down in Tempe that was built in 1960 after spending a year remodeling it. We got to the inspection, and guess what? The entire sewer system under the house was collapsed. I didn't represent them on the transaction. I got at the end of it because I would have told him, like, hey, if you're going to rebuild this, we need to go down this road. So sewer scoping is the number one thing I would do. Especially if you're representing buyers on flips, is make sure that that happens. I mean, it should be on anything. We kind of have a rule of thumb below 1980 or earlier than 1980. We're going to scope the sewer. Okay, let's jump into the numbers on this one. This one was actually entertaining for me because I went to MLS and like, hey, let's look at the fix and flips, or fix up, need repair category and see what's here. So this one's here, and, you know, I know the neighborhood well. I actually own a house a couple doors down from it, so it was easy for me to look at. And now sharing the numbers with me in the chat. One or two? One means you think it's profitable. Two, you think it's a total train wreck. All right, what do you got going on over there, Garrett? All right, I'm just pulling the spreadsheet up real quick, and actually, what I want to do is good, Right. Okay. Sorry, guys. I'm trying to switch to sharing the screen for the other piece. There it is. Okay, Maybe. Okay, first of all, let's just talk about comping a property and how we look at things. Pretty simple on Monsoon, if you have access to Monsoon. If not, there's some different, you know, tax records, different things you do or you go to the MLS or Zillow, whatever the case may be. Monsoon's always very easy because it's color coded for me. There's a lot of blue on this one. Blue means sold. Purple is pending. Green is either active or under contract. Right. I just can do a very quick search, which you guys can do as well, is like, okay, so this 330 is our subject property. Two doors down is 425, and it's about the same square footage, but it has a pool, and it's been remodeled. I can use that one comp and go. Yeah, this is good. Okay. What you don't want to do when you're doing this, you can't immediately go to the highest comp in the neighborhood, because if anybody remembers March of 2022, when the market stopped and everybody's like, we're gonna kill it on these flips, and it just, like, dead stopped. And they all went to the high side of the comps. There was no room for backup. That is why I don't go to the high side. If I go to the high side, that's risk. If I'm going to the low side, my risk reward is, I hope it does better than what it looks like. Right now. But if it doesn't, I'm okay with the profit margin that I have into and the risk that I'm taking on this property. Okay. Really important that you see that. Then you've got, you know, 415 down here, 1680 square feet in pretty good condition. You've got a 342, which is interesting because 342 similar square footage was completely livable. You could move into it. Yeah, it needs to be updated, but it's completely livable, unlike the subject property. So here's the numbers. I hope you guys all got a chance to play with the spreadsheet. It was designed for myself and my staff so that we could plug numbers in when somebody sends us something. And I wanted you to have it so that you can start learning what's expected and what the costs are. Because a lot of people leave out, like, what are holding costs, you know, because your utilities, HOA fees, the different things. What is the interest rate? This allows you to manipulate the numbers to see what it's going to look like. Because while this one is at 3:30, and you go and you put the numbers, by the way, I just took the numbers on another property that I'll show you in a minute, and you're easily 125 grand, which is 90 a square foot on this house to remodel, which includes everything, Right. It's a lot of money to put in this house. So if I just use the list price and I go through and I plug in all the things, right? So on this spreadsheet, owners, up to you if you want to use it. Square footage, I don't know why that's wrong. When you do the square footage, it's calculating percentages on the right side of the holding cost. So there's a percentage for utilities, insurance, taxes. It gives you a quick overview. It's not going to be exact, but it does give you a quick overview. Okay. Three bedroom, two bath. If you change pool from yes to no. If you watch the right side, it gives you pool maintenance in there, Right. If you change it to no, it takes that out. Same thing. If you add HOA fees and things like that in it, it's going to add into the right side for holding costs. Now you get to the middle column. This is depending on your client. You just like. I use a quick rule of thumb. Average hard money private lending, somewhere between 10 and 12%. So I just take 10%. If they're doing 100% financing, which it doesn't really matter to you. If they're doing 100% financing or not, it's just a placeholder for, for money so that they can see the holding costs or you can see the holding costs. And a lot of times I do do 100% financing with my private lenders. So that's why I use this situation here. Right. So 12 months, my interest payment is going to be 20$700 a month. My utilities, this house will cost me 30$400 a month to hold. Okay. It's a lot of money, especially when you take it six months because it's going to take 90 to 120 days to remodel. It's going to take another 30 to 60 to get it sold and get it closed. So I always take a six month average. So again I'm trying to paint the worst case scenario in order for me to know do I want to take this risk on. Okay. Now the reason I do these as is sales is just to see what the numbers need to look like. So I plugged in his list price and I said okay. And this is the same thing you can do with sellers. Hey, plug in their, their number that they want and then work it backwards because that's what this sheet does. And it actually helps you explain to a seller like this is why an investor will not buy this. And by the way, an investor that does buy this, they are not making a lot of profit for the risk they're taking on that you don't have to take. Okay. This is one of the conversations we should be really good at with the sellers is them understanding like yes, I'm selling it to you or Steve or an investor. There is not as much spread in these properties as people think. And here's the reason why as you look at this one, if you could sell this one, we'd all probably agree 410 to 415, maybe 425 completely redone on this property. Now let's go through the cost. You have 425 as a purchase price. Six months of holding costs, 1% in minor inspection, repairs, buyer commission, listing commission, selling commission or selling closing costs and then buyer concessions. Right? And then you factor all that in, you come down here like okay, this house at the current list price is an $86,000 loss. Believe it or not, we have lost more than that on a property because of a bad purchase. Right. And part of because of the market last year. But it happens when you do it enough, right. It's just law of average. So what we can do by plugging it in with the number where it's at is go back and go, okay, how do I get to the number that makes sense for me? If I'm going to take on the risk in our company, with our contractors, with all our things, I want to see a net positive of 20 grand at the bottom line, right where that yellow box is. I need to see 20 grand. That makes it worth it for me to take the risk. Doesn't seem like a lot, but it is. So in this case, I can go and just adjust my purchase price. Okay, we're getting closer. Now I'm at 14 based on all the numbers that are happening right now. For me as the investor or for any investor you're working with, maybe it only cost me 120 to renovate it. Maybe I didn't have to pay concessions. Those are all bonuses. But again, I want to paint the worst case scenario. And I'm also being able to show the seller just so they understand, like, I understand this 230 or this 225 number is really low, but you would have to pay all these same costs if we did it in the as is. So you can go over and show them the as is number go. Well, you know, if we got 270 out of it, well, 2.7 million would be awesome. And we start going down the road, you're still going to put it on mls. You might have some inspections, some cancellation, some other things. And you're like, okay, so this is like, if we're just going to traditionally like this house on Carol, just throw it on the market. Well, the seller's gonna net an extra $9,400 provided nothing goes wrong on this. If they sell it at 270. So it's getting them to see that the investor or the person. I really don't like the word investor because I think most people's opinion of investor is like, you're just looking to screw me. And the reality is I'm just looking to solve the problem and I have the abilities to do it. It's the same thing that I want you to be able to do is like, I have people that I can connect the dots and I can make this go away right now. Right, if that serves your purpose. Right. So on this particular case, you're now going in and being able to show the seller these different pieces and get to the number of showing, like, these are all the costs the investor has to hold. These are the commissions they're going to have to pay. These are the Repairs they're going to make, and they're taking all the risk to maybe make $14,000. Right. That's what we want to be able to relay to the seller. Now, in this particular deal, if you look at the tax records on this property, they overpaid for it. They bought it in June for like 255, and they've already overpaid for it from that standpoint. And it looks like, you know, they had structural engineering and some other stuff. So they threw it out there at 330 to try to make a small profit on it without doing the work. And my guess, in this particular instance, they got so far deep into it, they're like, this is going to be $125,000 renovation. We're going to lose money. Let's just sell it as is. That's probably why it's sitting out there at that, and it's probably not going to sell at that number. Okay. Now, it doesn't mean there's not greater fool theory out there. So it just depends on how you want to explain it to the seller and where you want to go with it. But I think a lot of people that I have bought homes from, they like the ease, the certainty, and they're okay, leaving a little bit of money on the table. Now, one of the things that's really important that I get questioned all the time. Well, what about your fiduciary duty to get them the highest price? Well, let's finish that. My fiduciary responsibility is to give my seller options and allow them to choose the option that works best for them. And it doesn't always mean the highest price. It could be the most convenient. It could be because I'm leasing it back to them for six months. It can be so many different things. My fiduciary responsibility is to help them solve the problem. Some people get this wrong, that my fiduciary responsibilities make sure they get the highest price out of the house. You got to finish the statement. It's the highest price that solves their immediate need. If the highest price is putting it on the market and sitting for six months, great, that's okay. The there's income to be generated one way or another, but more importantly, it's how are we serving the client? And if we don't give them this option, they will never know, or you will walk out after you told them, like, well, you need to clean it up. You need to get a dumpster. We need to paint this. We do this, that and the other, and then they go, call, we buy ugly houses. And you lost the opportunity to connect the dots and give them that option. That's why we're here today, right? I want you to be able to connect the dots with me and go, hey, I have something that's potential. Will you help me work through this? Now, some of you are like, well, where do I get paid on that? Right? What does it look like? Well, that's the great part about it. You're still getting a commission in this deal. And here's a brief structure on it. Just kind of see, if you look up here, we just ran through all these numbers. This one I took out the fee. Let's say this was not on mls and you are talking direct to the seller and you've got them negotiated at 230 and you're really hoping to make $7,500, which would be about the same amount of money that you would make putting it on the market as a commission and going through all the stuff. Okay, you gotta keep your income in mind when you bring us something, because I don't want to renegotiate the numbers. Go, well, it doesn't work because there's this money in it. We want to negotiate all the way down. So now we're looking at like, hey, right? The number isn't quite there. So I need to go back to the drawing board and go, well, if I can get this seller to sell this at 220, I can make $7500 referral fee on this. And it works in the numbers based on what I see. So. And this closes in 14 days. I'm working direct with the seller now because we've had that conversation and that introduction, and I am going to go through and I'm going to do a for sale by owner agreement. There's going to be a commission there. You are going to get a referral fee for $7,500. You don't have to process a listing. You don't have to do anything from that standpoint other than we're going to connect the dots and we've got a deal that we're working on. And I love doing that with you guys. And it's so important to the relationship aspect because guess what? We just solved the seller's problem. You got paid to solve the problem. Okay, now let's go one step further. You bring me this deal and you're like, hey, this was the number you gave me. I think I can pick this up for 210. Can I make 12 grand on this. Yeah, let's have the conversation. I want you to win, right? That's the goal. If you're doing the work, to win, I want you to win. But if you're bringing me a house that has no numbers and no conversation with a seller, you haven't done the work, which means I'm going to have to do more work to do it to get us to that point, which may be worth a little less money, but it is also worth the learning experience to see how the conversation goes and how things are handled. Okay. All right, let's pause there. Do we have any questions in the chat on this particular one? No. Okay. Is everybody muted or unmuted or. Okay, I'm just going to give like five minutes here. If you guys want to unmute and you want to ask a question on this particular property or the numbers or anything else that I said, let's do that. What's up, Anthony? Hey, Steve. Good to see you. So I'm glad you addressed. I'm glad you addressed the question about highest and best. Would you ever have them sign, like any paperwork saying they were presented these options so that something doesn't come back to bite you? So in the contract when I write it, number one, it's a for sale by owner agreement, so it reduces any agency lines. But number two, in the contract I've gone through and it says that I'm a professional real estate investor and the intent is to capitalize on it. Sometimes when they really get into the numbers, I will have them sign off on the sheet that they saw the numbers or presenting comps. You just have to be careful when you're going into that is how deep are you going to go into all the numbers? I'm okay either way. And here's why. I want them to know all the options and I want them to be able to pick. And, you know, usually there's an email that gives them the three options. Hey, you can sell it for this price. This price, this price. Here's the pros and cons of each. And so once you line that out, it's like, well, I would rather just take this money and leave $10,000 on the table and not mess with anything. And that's usually, you know, some of the options that are chosen. Some people choose to do the fix up. So, yes, I do outline it all for them. It's usually by email as to what we're doing. Cool, thanks. Yep. For this. Hey, Steve. Likely. Go ahead. How's it going, man? Good to see you. Good, see you so then it wouldn't be on mls or you would just get check cut out to you or how does that work? If you bring me something?

Right.

Yeah. So what it is, is we work that out. I'm going to like on this particular deal, what I do, once we get a net number, I raise the price to cover for sale by owner commission. That commission is processed with a referral fee to you for that amount of money. So it just goes into your brokerage as a referral fee. Gotcha. Somebody asked a question, the likelihood of convenience over money. It's about 50, 50. And it really depends. If you're using those questions that we're asking, you're going to get to the root of things and find out. Because there's a listening aspect to this when I'm asking those questions. And if somebody's like, look, I need as much money as possible because I have to put my mom in a home and this is all she has left. Now, they still may choose the convenience route because they don't have time to clean up mom's house. They don't have these things. But it's the easiest thing to do, even though it might be $10,000 less to Mom. But if you really break it down and they hold that house for six months trying to clean it up and go through things, the market shifts, whatever, they could be 20 grand behind. Something comes up in inspection, right? These are the things that we do need to tell the sellers. Not that we want to paint like a terrible picture for them, but we've all seen it, right? We've seen inspections go bad, people get canceled. Well, not people get canceled, just deals get canceled. And then you see where things fall apart because of financing. And we have to let them know, like, not everything is going to be unicorn rainbows through this once we get a contract. So it's always asked them, do you want the certain fair number right now that we know what it is, or do you want to take the risk and maybe some reward of going through inspections, putting the house on the market and closing? And by the way, if there's a 10 to $15,000 difference on something from putting it on the market or selling it to me or an investor? How much is their mortgage payment and their utilities going back to that holding cost? Are they going to spend over that six months? That really takes away from what their actual net number is. So don't forget to utilize. That goes back to why ask those questions? Because as we're having the conversation with a seller and like, well, And I'll give you a great example, actually, I'll wait because it's one of the properties that, that will go through on this. It just is one of those things where you have to utilize all the information for people to understand. Okay, that's. That's A great comment. $12,000 is not a wholesale fee. We don't wholesale things. I'm not asking you to write the contract and assign it to me for a fee. That is something we don't do. This is one of the things that I learned to do when I joined Real Brokerage because of our structure, is that I wanted everything to go through the brokerage legitimately. And we don't do wholesale fees, we don't do assignment fees. Everything is on the up and up. And there is a commission paid on the HUD through a for sale by owner agreement. If you have it listed, that's also paid. And we pay referral fee, not a wholesale fee. Because again, we are dealing direct with seller. Not that you're cut out of it. You still have communication with them. You brought the deal. All the things, we're still working together to get it done. But it is not a wholesale fee. If you are wholesaling. If you're wholesaling and you go buy something and let's say you pay 200 for it, you got the seller agreed to that. And then this is exactly what the wholesalers do. They tack on 20, 25 grand to it and then they bring it to you at 235. But you don't get to see all the pieces. That's wholesaling right there. Now, I will tell you that sometimes that works and sometimes it doesn't. But a lot of the wholesalers in this business, you know, if any of you are on here, you know, it is important to understand the construction side of things because that's where the numbers get lost. If we don't have a base of where the repairs are, that is where the numbers get lost. And that's where things do not make a good deal. And sometimes wholesalers try to take a very big chunk for no risk, right? If at the end of the day I make 16 grand and a wholesaler makes 20 and they had no risk, well, they're probably taking on better things than I am, but they're only getting those every now and again. And if I'm going to take the risk to own it, to finance it, to take the market risk and all the things, then I'm not paying that price for it unless it's A really, really good deal. And they earned their money by bringing me a really good deal. But I think a lot of us see in emails the spreads when we look at them and you run them through this, this spreadsheet, they're junk because they're inflating values. They're, they're lessening repairs. I mean, yeah, you could do it for 50 grand if you want to work on it for a year by yourself. But let's just be realistic. And that's what this sheet does. It gives very realistic expectations. All right, let's move on to the next one. Let me go to comps first. Oh, come on. How many screens open? Okay, this is 43rd Drive. Okay. Address is there. You can look it up, do all the things. I will give you the very real scenario on this one. Because it is something that we bought and we sold. We ended up not doing the work on it. So agent, one of my team members brought it to me. Here was the situation. The owner of the property died of a drug overdose and his siblings were managing the house on behalf of his nine year old daughter in Washington or somewhere back up there. And so now they're trying to make the decision of what is the best course of action for this. And all the proceeds that are coming out of this are paying the parents back for the money that they use to keep the mortgage up. And then whatever is left over is going to the nine year old daughter. As for her trust, which wasn't much. Okay. The house was a train wreck. It was disgusting and it just like the last one we just looked at, it needed $120,000 renovation because as you can see, it needs a roof. Right. This is actually a very clean picture of how much money. Yeah. So on this particular one, here's the scenario, we bought it, we ended up at 210. And let me just go to the numbers here so that we can all be on the same page. I'll go back to the comps on this once I'm done kind of going through numbers. So here's the deal. This is the let me go to the right sheet. Okay. Here was the actual deal and the actual numbers. And then I will break down the as is numbers in just a second. So we purchased it in February. It's 1433 square feet, three bedroom, two bath, no pool. We paid 210 for it. The. Will you grab my notepad off my desk real quick or on my coffee table? So I wrote some percentages down that I wanted to show you. We paid 210 for it. You can see a wholesale fee slash commission in there of 20 grand. Here's what happened. I raised the price. I covered a commission to my agent and I covered a commission to our company. That's one of the things that we do up front is because I still have a company to run here. So when an acquisition comes in, we pay the company. So don't, don't be all up in arms that I'm kind of taking profit out of the deal up front. But that's the way we operate our, our company here. So I got a loan amount for 230, 10%, $2,300 a month in holding. Now when we buy this house, I go through a 30 day due diligence with Wendy, with our contractor and say, give me the full bids before we tear this place up. In the meantime, our kids are trashing it out, filling up the dumpsters, and we're having the house clean, the landscaping cleaned up so that it's somewhat presentable to the neighborhood. And if we do decide, let's, let's go right? We, we know once that we have the numbers. But I won't start anything until I have the numbers. So when she brought me the number, she's like, hey, the sewer's trashed on this thing. It's 15 grand. It needs all new windows, it needs a roof, it needs an ac. So this is going to be a very expensive one. It's 125 grand. So now I start going through the numbers, I'm like, okay. And by the way, I got to hold it for six months. I have no idea what's going on. So mind you, we were into that thing for 230 with commissions and everything. So we just kind of took and said, well, what if we clean the house up and we threw it on the market at 290. Here's the cool part about it. Well, after we paid all this stuff, so by cleaning it out and prepping it and knowing what my budget was, we decided to throw it out there. Well, the cool thing was is an owner occupant who wanted to fix it up for himself bought it so we didn't have to go through and do the repairs on it. So we did pretty well on selling this one as is. But it was also just timing and market. We've also done this and lost money. So don't think that this happens every time. But this is how we determine if we're going to keep it or actually going to do the renovation in it. So this this number is always, we always lean towards renovation. But again, this one was a little slim. And I'm like, do I want to do it or can I just get out of it as is? And so that, that's what we ended up doing after going through the numbers because it was a lot more in renovation than what I expected because my original budget was like 75. And that seems to be the case if any of you are married. My numbers are always way lower than what my wife is going to spend, especially the grocery budget and the renovation budget on anything. Okay, let's go to the comps real quick on this. Okay, so this is 43rd. It's right here. We sold it for 290. Again, lots of blue in the area. But I started looking at things going 425. We were really pushing the top of the market at 425. The reality is that the top comp was probably closer to 400. So we definitely would have lost money, you know, by, by being that at 425. And that was probably two months ago when I, when I thought we could get 425 out of. So we had to adjust. And if I had given Wendy the go ahead, we potentially would have lost money based on the current comps. So sometimes I'm going to take on more risk and sometimes I will, I will just sell it as is. Maybe I'll find another investor. Maybe we have an in house investor. Sometimes we convert them to rentals. That's really, you know, it doesn't make much difference to you because what I'm trying to do is get you to have an ability to increase your income. But I also want you to see, like on this one on 43rd, when you have the availability, when you're ready to partner with something, these are the types of deals that are there that you can now capture yourself. Eventually you're not going to need me. Maybe you will, maybe you won't. The goal is for eventually for you to be able to do this for you. Okay. All right. I'll open it back up for Q and A for a few minutes on this particular property. Questions? Anything you want to go through, anything in the chat and then we'll take like a 10 minute break. You got a hand? Oh, five minute. I said 10. Are you always running the 90 to 100 a square foot or is that just when you feel there's so much to do? Great question. So these two particular properties are full renovations, roofs, all those other things. If we took these properties and let's say the roof was in good shape, the AC was in good shape, all the major components are in good shape. You can do a renovation. This is going to depend on the area you're doing it in. So I'll get into that in just a second. Is on like this particular house, 1400 square feet. On a retail side, if we're doing everything top to bottom interior, it's about $50 a square foot. And I'm not giving you guys some sort of discounted fee of what I pay because my wife is a very expensive contractor and we don't put everything in the same bucket. So I pay her just like you would pay a general contractor. She gets 30% over whatever the cost is to do it. And she gets paid out of our deals because I don't want to show any numbers that don't make sense and be like, well, your wife's the contract. Yeah, and she's freaking expensive. Just because I'm sleeping with her doesn't make it any cheaper. Right. So what we do on that is we're about $50 a square foot, which is an easy trigger number if you're with a client and the whole house is livable, but it's outdated. It's about $50 a square foot to do it. Now you get into some properties in Scottsdale or upper price ranges, you might go to 60 or $65 a square foot because you're going to have a little bit higher end finishes, those types of things. Here's what's crazy about it. My wife and I used to argue all the time and it used to piss me off when I get the budgets. How does a 3000 square foot house in Scottsdale and a 1200 square foot house in El Mirage, why is the difference in the price of the kitchen $1,000? It makes no sense to me. She says, here's the deal. Same thing with the bathrooms. A hall bath is about the same size in most houses. And just because it's in Scottsdale and just because it's bigger doesn't make it any cheaper or any more expensive. In El Mirage, a kitchen's a kitchen's a bath a bath. The only thing that changes there might be a couple extra cabinets, a couple extra square feet of granite, and maybe an upgraded cabinet. But I had to start realizing like crap, if you tear a bathroom and shower out with a normal single sink and vanity, she's right, the price doesn't change. It doesn't change in El Mirage and it doesn't change in Scottsdale. Other than A little bit of upgraded finishes. Other than that, they're pretty much the same. So you have to look at like no matter what it is, if it's a kitchen and bath, it's a kitchen and bath. The only things that truly change in the house are by square foot is paint and flooring. Those are, those are the two things. Those are the only things that are true adjustments. Because if you're painting a 1200 square foot house at $3 a square foot versus a 3000 square foot house at $3 a sq ft, that's what changes. Same thing with the flooring. So those are the big differences on the remodels. And that's why we use around that 50 a square foot as a rule of thumb if we're going to gut it. Any questions in the chat there? Okay, one in the chat. If you're getting anything out of the first hour of this. Okay. All right. Just for humor, if you guys want to take a break, I'm going to just hang out here for questions and answers and then I'll dive into a couple of more properties which are a little bit different, different strategies. And then we're going to break into some Q and A and really going through some of those pieces. Sound good? Oh, yeah. Five minutes instead of 10. So if you got to go, go. I am going to do that. Hey, Steve. Yes, sir? Quick question. Can you re explain why you're running these as a commission as opposed to a wholesale assignment? Oh, that's such a great question. Just kind of reiterate that I kind of missed what the. Why you did that. Okay. I did it for two reasons. One, because I'm at real brokerage when I'm buying these things or running commissions, I wanted to hit my caps as fast as I could by collecting wholesale fees and not running through the brokerage. I don't collect my caps and I can't hit it faster, which gives me more stock purchase award. It pushes it faster and it makes it for the second part of that. So that was one of my big reasons is because I have advantages by pushing that stuff through the brokerages because of what I get at the end of it, which is a great return on stuff. And then for me on the brokerage side of things, just running the commissions and paying referral fees, it makes it so much easier to run it through the brokerages testing. And Everybody gets their 1099 at the end of the year. And I'm not trying to track all that stuff in our internal accounting. And. And it's really? Like, yeah, you can do the wholesale fee, but I could call it a wholesale fee or a consulting fee, but with Department of Real Estate rules, I'm violating not paying things through the brokerage. All right, does that answer the question? Because you look like you have one more. No, I just wanted to. I was just wondering if there was a liability issue if I wholesaled something but still ran it through the brokerage and paid them their piece. You know, signed off on everything as far as waiving inspections and whatnot. And I was just wondering if you're seeing a liability issue there that I wouldn't be doing about. No, I don't. I don't think there's a liability issue. All of it's in disclosures, but it really comes down to what your brokerage requires. Right. And so for me, when the whole, you know, when we went from my home group to real brokerage, there was just different things that I was planning for that I wanted to experience inside the brokerage. And again, I don't do wholesaling. I'm always the buyer, so I haven't had to experience, like, the wholesaling part of it. And I just. I always struggle with it and where it goes and what it looks like and the liability piece of it. So this was just what I found, the best way for me to do it and the best way that it works for both agents that are involved when it comes down to it, because everybody's getting paid through the brokerage. Right. All right, cool. Thanks. Huh. Hey, Steve, quick question. Yeah. When you say the contractor gets 30%. Yep. Now, that's. The 30% is also already calculated. And whether it's 90 to $100 a square foot or 50 to $60 a square foot, Correct? Yes, sir. Okay, perfect. Yep. Thank you. Huh. So is this part of our break or are we going to keep asking questions? Sorry. No, you're. You're fine. Keep asking questions. We're totally good. We got about three minutes left on break, so I just want to be able to answer any questions that people had.

Question. Who's your hard money lender? Your go to Guy.

Goto is either LM2 or I've got a private gentleman. His name is Brad Fry, which I can connect people with. Most of my capital is built through relationships, so a lot of my clients are our lenders, and that's a different topic. But those are. Those are my two main hard money people. And we can connect those in the email that we'll send out after this.

Awesome. Also, do you what form do you use for like subject to.

I don't. When I'm doing a sub 2 or a wrap, the formula is so much different, you know, I mean, it's still, if somebody brings it to me, it's kind of wrapped up. I would rather be the person performing the contracts and the pieces because I have certain things for myself when I do those and understanding the seller situation, those types of things. So a sub 2 is kind of going to be a one off. I really don't have a formula with it. I don't do a ton of it. I usually do it with my own internal clients, but I don't do a lot of it outside of that. Is it something you're big into?

I'm really interested in it. You know, I've been, you know, trying, I'm trying to buy a property once every year. That's my goal for the last like four years. And this is the one year I haven't been able to do it. So. But I definitely want to start deep diving into that more. So as far as like, you know, taking, taking, you know, the creative financing strategy. So definitely very interested into it.

So, yeah, the, the, the, the rap or the sub 2, it depends on, you know, which area you came from. You know, I know sub 2 is a big thing with Pace Morby and that, that is his claim to fame. You know, in my dad's old days, we called it seller wraps. Same thing. And there's so many different ways to do it. So there's also a ton of different liabilities and how it's picked up. And a lot of times on a sub 2, most of the time it's going to require cash, you know, down payment, cashing the seller out, those types of things, it's, it can get pretty sticky pretty fast. And so it's just something that, you know, you should research and kind of go through. I enjoy them when I can, but they're very few and far between. But they, they are something that is amazing. They also can be very frustrating depending on how you put them together, you know, because you might have, you know, one of these sellers that you did it with two years ago and all of a sudden they're trying to buy a house and they need you to be out of that mortgage so they can do these things. So you have to have very clear conversations. I really prefer sub twos on older people that are not looking to get another mortgage. They're moving with family, they're moving into assisted living, and they're never going to need another Mortgage again. And those are the things that I like to take over. Interesting story about a sub 2 which I inherited one property from my dad is actually I bought it from my mom. It was a sub 2 that he had. And great house, great cash flow. I think we owe like 80 grand on it. The funny thing is I tried to refinance it two years ago. My dad didn't keep good enough records with the seller's information like Social Security number and some of the other things that you need to get access to the loan or having a third party authorization. I still couldn't refinance it because that lady died six years ago. And we just keep paying the mortgage. We can't do anything but pay it off at this point in time. So it's kind of interesting on some of those is making sure that you have a lot of the personal information or you're added to. One of the things that we started doing our sub twos was having the seller add us as an authorized third party on their mortgage. So I can call in, I can change mailing addresses, I can do all those things. And again, it's a very relationship driven for me. So I really only do it with clients that I know and trust and go through. I don't do it with a lot of strangers. But it works, right? Lots of people do it. You just want to make sure that you have your system for it.

Definitely. Also I just did a training. What was it? Wealth management. Well, something with wealth and basically when you do subject to, you got to be careful because the seller can incur capital gains for that. So that's just another thing with subject to which is kind of dicey. So anyways, thanks for all the advice.

Okay, so real quick on that, you know, on sub to seller carrybacks. You know, we talked earlier about financial literacy on things and I'm so in tune with our CPA and understanding the taxes and real estate and how certain things work. This is a real bonus when you're working, whether it's sub 2 or seller financing, any of those things, you're doing creative financing. Keep this in mind. When a seller sells that property and they collect, they don't collect any money. Maybe they collect a little cash. They're only subject to capital gains taxes when they receive more than 20 to 25% of the principal in any given year that they will have to pay that capital gains on what they received. But if they're doing interest only, you're just making payments until that note clears out and goes through that they are not subject to capital gains tax until they get. They start receiving principal. So it is something that's very beneficial for people that to do seller financing that they might have a huge tax liability. And again, different topic, different time, because it's kind of fun to go through and show people what it looks like. That is what that looks like. So, you know, I'm not a cpa Double check with your cpa, but that is, that is what has been the rule of thumb on seller carrybacks and sub twos is that understanding that until you collect principal, you're not paying capital gains tax on it, which allows you to kick that capital gains bucket down the road even though you don't own the property anymore. Gotcha. Cool. All right, on, Jess, here's the deal. If it's hit mls, I can guarantee you either, one, it's going to have 9,000 offers on if it's any sort of good deal. And two, you're already dealing probably with an agent that's playing hero syndrome, which they've, you know, put the house on the market and we're going to get this and we're going to go as is and we're going to go through all these hoops. By the time it gets to MLS and there's commissions and all these other things, there's probably not enough numbers in it because the agent is going to do their best to get the highest price out of that MLS listing. So the MLS is tough unless something may have sit there for a long time. And, you know, I appreciate you asking that question. Sometimes the MLS listings, not so much on the fix and flip stuff, but on stuff that's outside the box, which the last property I'm going to show you guys is one of those deals. It's learning to see different things and go, is this a possible opportunity, which is creating things out of thin air by understanding your knowledge and seeing what somebody else doesn't see. And so a lot of times as an agent, we are trained to do the comps and the things. And once you start to learn like you were doing today, the investment side, you'll never look at properties the same again. You will constantly look like, well, I wonder if that can be chopped up. Can that lot be split? Can I demo that manufactured home? Can I do. These are all the questions that I ask. These are all the things that I do while I'm driving around talking to myself in my head. Right, right. So that's a great question. We don't canvas mls. We're more canvasing like this Conversation. And this training right here is to build relationships with you so that we can work together before it goes to mls. Because a lot of times as agents we go into the property with a seller and we're like, this would make a really great investment property. But I, where, where do I find a buyer for this is my only option to go to mls. Here's what I want you to be able to do in that appointment. I want you to say, hey, you know what? I do have an option. I have a person that would be willing to buy this. Would you be willing to have that conversation with us? It doesn't go to mls. We sit down with a seller, we have the conversation, we go through the numbers and we figure out if it works, then guess what? You're not the bad guy. You didn't make the offer. I came in, I gave the numbers. Does it work for everybody? Is everybody win on this deal? And if it does, we solve for it? And see when I'm there, I also like to ask, so like do you need time to stay in the house? Do you need some lease back? What does it look like? Where are we at? Right? And there's so many different things that I can help. And by doing that, you are also learning for the next conversation or maybe your own next deal. Right? So just consider that when it comes down to it, MLS not a great thing unless you're looking for specific opportunities, which I will show you. Cool. I miss anybody else in here. Sub 2 Do they retain the exemption for primary residence when they receive final payment? Well, if it was a primary residence, then it shouldn't make any difference, you know, when they receive final payment because they're just turning it in that, that to a long term note or residual. So if they received any additional like income from it, they would have passive income from it, but it still would retain their primary residence. All right, let's jump in. Hey, I'm going to introduce Brandon Hair on this property because I want him to set the stage as to how we work with you as real estate agents. So let me just set the stage here. Brandon's just jumping on. Brandon and I have worked together, we have been friends for 20 years. He worked with my dad, he did some construction. We went our separate ways for a while and then we came back and you know, we talked about wholesaling, which I learned from what my dad was doing. Brandon has been an expert in this and creating relationships and, and helping agents get the deal to the finish line. This is one of those deals. So, hey, Brandon, you want to just kind of like chime in and just kind of talk through, you know, the agent, the situation with the seller, and how you guys came up with the numbers?

Yeah, sure. So this was a property that real estate agent called me, somebody that, that I've worked with in the past, and she called me and said, hey, I've got this property. The sellers, unfortunately, the seller's wife had just passed away. They'd been in the property for, I think, 30 years. They had lived in the property together. And so she called me and asked if it would be something that we would be interested in. And I said, sure. So the seller knew that some repairs needed to be made in the property, and he was just going through, you know, the grieving process with his, with his wife and wasn't really in a position to where, you know, he was wanting to put it on the market and, and show the property and have people coming in and out of the property and stuff. So I met the, the realtor and the seller at the home, and we sat down at the kitchen table, and after they had showed me the property and gave me the tour of it, we sat down at the table and came up with, with a good offer, a good price that they were satisfied with, and we ended up putting the deal together then and there. And, you know, that was, that was pretty much the gist of it. So, you know, I have realtors that bring me deals like that all the time.

I'm.

I'm obviously a realtor and, and love creating relationships with them for that purpose. And it was a situation where it helped him because he just wanted something quick and easy. He was moving into a retirement community, so he, he was just excited to be able to not have to make any repairs on the home and be able to be out of it and, and move on with his life. You know, I think we ended up closing on it within a couple of weeks or so, and he was able to move on. So it really worked out for him. And the agent was super excited because she made her commission on it and it was just a quick and easy deal for them.

Thank you, Brandon, for that. So here's, here's the deal behind all that is that when you have these situations, where do you go? Who do you call? What does it look like? That's not going to be this ridiculous cash offer and the low ball thing. It's really about a meeting of the minds and you knowing, like, what the seller situation is and then saying, I have the perfect solution and here's where we're going to go. And I trust these people. And we're not dealing with the cancellations and the, oh, well, you know, maybe we need less money on this because of the inspection. It's really very, very simple for everybody. And that is, that is Brandon I's goal when we're acquiring properties with you guys, is that we get to work together, we get to create the win win. This older gentleman, he got to walk away and leave a lot of in the house. He didn't. He only took what he needed. The rest of it, he left. That's one of our things that we do with you, like just leave what you don't want. We'll figure it out. So it's finding that solution. And again, like on this particular case, the agent could have pushed him to go to market. We can get more money out of it. His reality was, I don't need any more money. I lost my wife. Just get me out of here and make this simple. I'm okay, because I don't need any more money. Just give me simplicity, please, and let me move on with my life. And we need to listen for those sellers when they're in that space. And it's okay. Like, hey, do you want a very simple, quick, clean option, because I can present one to you, or do you really want to go through the chaos of putting it on the market? And we can all agree that sometimes putting a house on the market seems like it's going to be super easy and it turns chaotic. Right? This guy's 82 years old and he's got to hire somebody to clean the crap out of the house. He's out of the house. The contracts are going to come in, they're going to get negotiated. Then the inspection, he didn't want to deal with that. And it's okay as real estate agents to paint that picture, right? Some people are okay going through it, some people don't want to. And it's our job to help them and guide them to a state where it makes a win win situation for everybody, including yourself. Right? Because here's what you just got paid to do. Here's how you just earned your income. You connected the dot and you solve the problem for the seller. You deserve to earn an income for that. It doesn't, doesn't matter that you didn't have to do all the paperwork and go through all the things. What matters is, is that you brought a solution to the table that solved their problem. That's the key, right? And the goal every time with Brandon, I is that we are all creating an income, we are all solving a problem, and everybody gets to smile, walk away. Because here's the deal. If anybody feels like they are getting screwed in a deal, I don't want any part in it. That's one of the reasons that I don't work with a lot of wholesalers. If any of you are wholesalers on this call, no offense, but I have dealt with a lot of them and a lot of them are sleazy. And I hope that you will change that in what you're doing. You know, if you are wholesaling, you're trying to solve the person's problem, not screw them out of their house so you can make 10 grand because you're desperate. Okay? We are dealing with people and their lives and their finances. And yes, while some people will leave money on the table, it doesn't mean we have to rob them. That is my one thing that I have. And I just bought a house recently that I watched a wholesaler, which really is frustrating. Super good on his part, not great for the seller. And if I had been involved, the seller might have had an extra hundred thousand dollars in their pocket. This wholesaler made $200,000 on a house that I just bought from them. And it just wasn't right the way it went down and the way they negotiated things. I can't help but I'm still going to take the deal that's on their conscious. You know, I can't change anything about that. But that is one of those pieces where that seller had. They called an agent or somebody. That's the one where we found the milk. They might have had more money in it, but they didn't talk to somebody. Right. So don't think that you're doing somebody a disservice by offering that piece for them. So this one on Maryland, here's what it looks like. Here's the comps. I think Brandon nailed it. He said, hey, I think this one will sell somewhere between 450 and 475. Right after we put the house on the market. Again, my risk, I was like maybe, you know, looking at 350, 370. We paid 290 for it. This one's a model match one on the market, 475. Now I'm going to show you because I thought it was tight and Brandon and I sometimes squabble a little bit back and forth about our numbers. We do, because I, I don't, I don't want to lose money, right. I Have no problem solving the problem, but not at my expense. Right. So this is just a little patio home complex in central Phoenix. One of them sold for 461, I think this was the comp that we were looking at originally. It's smaller and it back to Maryland. So we're kind of looking at these comps and going, okay, what did this one have? Well, it was only a carport, little backyard, decently updated, you know, new kitchens, new baths. So it was in good shape. It, you know, it deserved to get its price. The thing that Brandon brought on this one, and again, this is where you see value in things. Sometimes you see it, sometimes you don't, is this particular place. That's why I'm zooming in here. There is this easement behind the HOA that all these people have extended their backyards. This one never did it, but we can. So we can add 10ft to the backyard backyard, which we're doing right now. It had some additional value items that gave it more potential value in the flip and seeing that. So sometimes it's just seeing different pieces. So this particular was that it's also an end unit. We're going to convert the garage carport to garage.

Yeah. And the thing with the thing that one is, you know, like I said, the sellers had been there for 30 years. 20, 30 years, something like that. And there was just a lot of deferred maintenance that they hadn't got gotten to. So, you know, the house needed to be remodeled and they just didn't want to deal with it. So, you know, when the agent called me and said, hey, you know, do you know anybody? Do you have anybody? I said, yeah, let me take a look at it and we'll see if we can put it together. The seller just didn't want to deal with it and that's okay. But those are the perfect examples of the type of deals that we're looking for. And it helped his situation and it gave us a good deal to work on. So it just really worked out okay.

Somebody just asked, do I have a particular buy box for deals? Right. My buy box is so wide. I don't. We don't get into the big, like tear down an 8,000 square foot house and do the luxury stuff. Like we just don't do. We have more of a very systematic approach on things. We're looking at manufactured homes right now that are tear downs. As long as they're owned land. We're still looking at rental properties. If there's some creative financing potential in it, anything that has these types of numbers where I know that as an investor, I can make that 10 to $15,000 or $20,000 when we flip the house. Those are all things I'm looking at. And it doesn't matter what part of the valley, I will look at it with you, and I will help determine, like, is there something here or not? You know, or Brandon and I will. So it is one of those things. Sometimes you got to throw things out there and go, well, is there something here? Here's what's really important. Don't send me the stuff that's on MLS because we already know and kind of determine it doesn't work. What it is is looking at things and going, maybe you look at mls, you're like, hey, I found this manufactured home. It's on the market. It's a piece of crap. It needs to be tore down. Is this something you'd be willing to buy? I'll look at it. We'll have a quick conversation. But I do want you to understand the numbers. Like, we're going through here is like, don't just throw things at me. Take a stab at it. Practice. Because then I can say, hey, this would work if we had this number. Do you want to go back to the seller and see if we can get that right? Because this is where my number has to be. The more we have those conversations, the more to look at things, the more knowledgeable you are, the easier it is for you to spot a deal. And what we're looking for, I mean, you know, I've got some of you on this call right now that are hunting down manufactured home lots for me. You know, we're, We're. I'm going to be the king of manufactured homes. It's kind of fun. It's real easy. It's a great way to create rental properties. It's a different avenue. You know, we're. We're looking at vacant lots that we can put those homes on. And again, it's really anything out there that is potentially going to make money without a lot of risk. I don't mind the risk of putting money into a house and those types of things. But, like, if you see these houses, like Maryland. Let me go to the sheet on Maryland. So Maryland, here's the numbers. I hope that answers the. The buy box question. One things that, that I didn't cover terminology at the beginning of this, and I should have is understanding the lingo that people throw out there on Instagram and YouTube is the ARV, which is after repair value how do we get to after repair value? So many people are like, hey, you know, I bought this one at 70% ARV. Well, it's 70% minus the cost of renovation. So on Maryland, if you look at this, which is kind of crazy. And again, some people are like, there's a $200,000 spread in this. This is such a great deal. I'm like, dude, you're not. Or, ladies gentlemen, you are not going in and understanding what the cost is to do all the things in that $200,000. So I want you to see this really closely on this sheet, because we're in the middle of remodeling this right now. We bought it in July. It's 1530 square feet. It's a 2 to $330 a month in HOA fees. We paid to 90 for it, right? Then there's $15,000 in wholesale commission fees above that, which went to the agent and Brandon. And now I've got a 10% interest rate. It's costing me $3,400 a month to hold that house. This is a house that doesn't need a ton of exterior work. It's all interior. So when I look at it, it's. Should have ran this number before. So this one's right on point. $85,000, what we're going to put into it. It's $55 a square foot. That is new kitchen, new bathrooms. We filled in all the concrete, all the sunken living room and bedroom. So there's a little bit more cost there. And we're extending the backyard. So there was right around the perfect budget for it. So I'm taking that pending comp and saying, 475. It's model match. It's on the same street back to the same bigger backyard. So. And it was remodeled. So now I can safely say, okay, 475. Six months of holding, 1% inspection, buyer commission, all the things that we talked about. This one has a little bit of meat on it, but it also gives me some safety room if something goes wrong. If Wendy's budget's off by 10 grand, I'm not losing money. Hopefully we hit the number. The budget's less, not more, and we sell it in less time. But again, that's the risk that I am taking. It's always great when people look at these sheets like, oh, you made 33 grand on that deal. I'm like, yeah, but I lost 50 grand two ago because something happened in the budget. Something wasn't planned, Right? So it's not all A cakewalk in this part of it. And again, this is a lot of risk. So you know a lot of people like I want to fix and flip homes. Sure you do. Until you lose a bunch of money and then you figure out shit, I wasn't prepared for that. Right. But right now I think there's a lot of people that could really use the bump in income and a different strategy in their marketing and how they want to get there until they're ready to start investing. And even then I would rather you start collecting homes. Like the gentleman said earlier, one a year where you buy this really good deal. Again, different topic. I just want you guys to know the numbers because I can go a hundred different directions with this stuff. But the better you are at this, the better you're going to be at generating long term wealth and net worth going forward rather than what we have been taught in this business to focus everything on transaction and gross commission income. That is your job. That is how you create income. That is not how you create wealth. You create wealth by knowing this freaking market like the back of your hand and how to move things, turn things and make it a gigantic chessboard. This is something I wish that my dad had taught me a little bit more when I first got in the business. But it took him dying and it took him working for a bunch of asshole investors for years and selling his soul to the devil before I realized f a bunch of that. I'm not doing it for these greedy bastards. I'm going to do it for myself and then I'm going to teach my clients how to do it. I'm going to take my clients from being a homebuyer to an investor and help them create wealth. So I have this saying that I would love for you to take on and it's with every client. I will work with you, but I will not work for you. I am not your chihuahua. I am not your beating post. I'm not any of that. I have put my time in this industry. I know what I'm doing and I will work with you and we will solve the problem. We will get the house sold in one way or shape or form or we'll do investings. But we will work together because we're a team and we both make money in this. This is not one sided. It's one of the reasons that I don't work with a ton of investors on fix and flips. I did years ago, but we were partners. But some agents like they go find a deal like that house on Carol and they sell it to the investor and then they manage the job so that they can get a commission here and a commission here. And by the way, that investor, if they don't make enough money, they start dipping into your pocket even though you did your job and you can't control the market. That's where my frustration came in. Watching my dad with people that had a lot of money and my dad working for pennies on the dollar because he didn't value his knowledge. And I just refused to do it. And so now it's more about, hey, I'm going to do this and keep working towards it and I'm going to keep teaching my industry how they can do it as well. Because I do believe it makes you better. And I believe that it's awesome when you're market proof and you can go work for yourself every day if you really want to. Because a lot of times I'm the buyer. Right. Doing this with you is generating business and opportunity for both of us. And it's also generating knowledge so that eventually you are starting to capitalize on these deals, not just for income, but for future. Okay, I'll get off my soapbox now. All right. So that, that's the Maryland deal. That's. That's what a great flip looks like for us. Everybody made money, everybody wins. We solved the biggest problem for the seller together, and now we can move on and go do the next thing. And the best thing is agent didn't have to do any paperwork, didn't have to go through all the stuff, didn't have to put a sign in the yard like she got a real net commission, which all it took was having the solution or tool bag to give to the seller. All right. Okay. Here's, here's a more creative deal that I'm going to spin through this with you guys. And this is why it's important that if you have something and you've answered those questions and you have some knowledge that you share with me, and I'm like, well, maybe we can present this to them and maybe this is what it looks like. So I want to show you this property. I'm actually, I'm going to pull the email up too. Let me see if I can find it. While I'm talking through this, one of you asked about, do I put things in writing? I want to actually show you the email that I sent to these sellers. So let me, let me paint the entire picture for you. Some of you have had these calls. Okay. And I want you to see this from Your perspective in this way. When we're done with this, I'm going to show you how we work together. But you end up taking the property. Okay? Some of you really need the guidance when it comes down to one of these deals because you potentially don't have enough knowledge yet to ink it. You might get yourself in trouble. But there's a way that we work together where I'm getting a consulting. You're investing in a consulting fee with me so that you can keep the house and move on. And that's what I want you to do eventually. That. That is what. That is the goal. That's the goal of you guys being here is having this knowledge so you can start moving it for yourself. Okay? And by the way, this part of the business is so much fun when you're really solving for the problem. So let me paint the picture. My lender, Kelly Zitlow, she referred these brothers to me and small world. We ended up having mutual friends, different things. This is their mom's house. It's in a manufactured home community over at 67th Avenue in Paradise Lane. I'm eyeballing this neighborhood because I'm starting to see where people are scraping these and building stick builts or they're putting new manufactured homes in all the different pieces. So it intrigues me because it's a very valuable square mile that has crap on it. And it can't stay that way forever because it will turn as it's turned around, it. You start to see it turning internally. So they brought me the house. It was built in 85. So one, it's financeable as a manufactured home. Two, mom just moved into assisted living. Here was the question that I asked, and these are like really important questions is I started to ask about mom. I took my eyes off the house. I'm like, oh, well, tell me about mom. Well, she's in assisted living. It's costing about $5,500 a month, and she has about $2,500 a month in Social Security. So our goal is to sell the house so that she has that X amount of dollars to cover the difference in her assisted living care per month. I'm like, okay, cool. So let me, let me. I want to understand this clearly. When you sell the house, you're going to get somewhere between 200, $250,000 just depending on how we do this. And that's $36,000 a year, which means that your mom has enough money to last about five to six years on the current care. If she doesn't have to be adjusted, which they were concerned about. I'm trying to see where the root is. Okay, remember one of the questions I asked, like what's the root of the problem? What's the root of what we're trying to accomplish? On this particular case, there was only one number that stood out to me. Mom's short $3,000 a month. That's it. It's the only number. I'm not looking at the house, I'm not looking at the sales price. It's one number that is the root. Now let's solve for the root in multiple different ways. So I brought this email up and I said, look guys, mom's stuff is all over the place. The house needs paint, carpet, it's in good shape. It's got a metal roof, it's got a big yards, all these things. It's great. And a hot tub that didn't work. And it's got a two car garage. For some odd reason, I put the rear of the house up here. But it's older, right? So here's the deal. We started looking. I'm like, okay, if we put it retail, we're going to be about 280,000. That's probably about our retail. If you guys go through, you get a dumpster, you clean all this stuff up, we do the paint, you put about $10,000 in repairs in it, you're probably going to net somewhere around 250, provided everything goes accordingly. By the way, we're in a first time home market here. We're 280. The good news is this is financeable, but we're going to have some repair issues. Like you can see the eve on the patio. Like that's going to be a problem in this price range. I'm not trying to tell them it's going to be the worst case scenario. I'm just telling them like, these are the things we need to be prepared for. Because I don't want you to be mad at me because you did all this work for six months to all of a sudden realize you could have been done with this six months ago for a little bit less money and less headache on your part. Because a lot of times families don't want to mess with this stuff. They're like, dude, just make this clean. Because we are too busy to deal with. That's exactly what they wanted. Because when I started going through with them like, okay, we got three months to get this cleaned up, another 45 days to get it sold, another 45 days. So we're six months into this, Mom's running out of money and the two of you and your busy jobs and careers on the weekends are coming over here trying to clean this out enough to get the repairs done. So these were all the things that led up to having that conversation to that three grand. I'm going to see real quick. Give me two seconds. Let me see if I can find this email that I sent to them. Feel free to jump in and ask any questions while I'm looking for this. Yes, I did buy this with no inspections. Okay, found it. All right. It's on septic. Well, we did a septic pump insert on it like we normally do just to make sure. Where's the email? Is it here? Okay, let me walk you through this. I gave them three options. Okay. Traditional as is option. So kind of like that. House on Carol, utilities on. Leave the stuff. This is what it's going to look like. And this is how I cut it down, right? 10% cost of sale, 6% real estate fees, 1% closing cost, 3% negotiated room for seller concessions if need be, two to three months of taxes. So we just went through all the things, right? So when it ended up, they might end up around that 240 range as a sales price and their net. Right. So here's how I broke it all down for them. Traditional sale, 275 Cost of sale, approximate repairs, holding costs, which is utilities, taxes. Approximately six months of timing. They clear 225 at the end of the day. Now as is investor offer off market, $200,000. Right. Just straight out, leave everything. This is what it looks like now. Started going down towards it and I did the, the last offer because it was free and clear. If you look at an as is sale to Investor off market, $200,000 net offer, plus seller financing, principal and interest payments of $3,000 a month. Pay attention to that because let's go back to the root of the problem. What was the number? It was $3,000 terms would be negotiable for how long? The note would work over five years. This would increase the money towards mom's care by nearly two years. This goes back to our financial literacy of showing people how numbers work. And what's crazy is the amount of our clients that are not financially literate and we need to explain things to them in layman's terms. The goal here was $3,000 a month is what they needed to cover. Now I could have gone out and used private capital to buy this house. We're going to get to the next stage of this in just a second. But seller financing. What I told them, like, I'm going to go borrow money to buy this house. You're going to get mom's money, and how are you going to grow that to offset that $3,000 a month? Well, the typical answer is, well, we'll just put in like a 3 or 4% money market. I'm like, well, we can, we can grow that faster if you want to, if you want to leave the equity in the house and be the lien holder on the property. And we started walking down the road of seller financing. Those are the options I gave them. We went back over, sat at the dining room table, we walked through it. They wanted to 10 for it. I was okay with it because there was a different looking at this property. So for the gentleman that asked, like, am I scrubbing mls? If this was an mls, I would look at this a little differently. And here's how I looked at this. And this is why no opportunity where there's something is worth having the conversation over, even if it's five minutes, even as an email to look at and go, yes or no, this is the reason why. And I'm always going to give you a reason why. If I can pick it up for this number, I can do it. If I can't, that's okay. Right? It's an opportunity. It's a conversation. It's kind of like a letter of intent. It's really outlining their options. So when I go on appointments, I will outline three to four strategies for the seller. They get to choose their own adventure they want to put on the market. Cool. They know what the ramification is. If they want to sell it as is on the market, they know what that's going to look like and they can do the easy, convenient thing. I also asked if they wanted to keep it as a rental. They didn't. That was off the table early on, so I did that. Yep. So let me go back here. All right, here's, here's what I did with them. We paid 210 for it. I have 5% interest on it as a seller carry, but I did a principal and interest payment. So I'm reducing the principal of the note by $1,000 a month. So it's not going to cash flow for me. But it was intentional and I'll show you why. The $3,000 was the number they needed to make mom comfortable. And we extended her assisted living care money by about two years by doing this for them without the risk of the market changing stocks, any of that other stuff, where's it got to go? It all stayed put. It worked really well for them. They were super happy with it. Right. So my holding costs on this, with the current note not including the thousand dollar principal reduction is $1300 a month. Now here's a retail side. 280, $15,000. I didn't put all the commissions in. Here's why I'm looking at my equity position at the end of the day, because we kept this as a rental and there was a reason why we kept it a rental. Which leads back to the conversation of what about the MLS stuff? It's getting to see, like what are options and what do things look like. So here's what I saw on this house that most people will not see. I was able to pay probably about what I put on here. I think I paid 80 cents on the dollar for this house. Right. Take the commissions out. I got about a 10% discount on it. We're going to keep it as a rental. But I also got seller financing, which made it simple. I have a gentleman right now that specializes in lot splits. This house is a 14,000 square foot lot. It can be split. I can remove this home. So while it's being rented for the next 12 months, the lot is in the process of being split and two new 1500 square foot manufactured homes are in the process of being ordered. So when it's all said and done, I basically paid $100,000 per lot. I will put two new 1500 square foot homes on it that will now produce $4000 a month in gross revenue as rentals and they will be brand new. This is, this is where the outside the box, the creativity comes in. And, and it's, it's learning to look at those things. Like, is this lot splittable? Is it big enough to do it? What does the neighborhood look like? This is where some of the MLS deals were. Like, is there something here? Not something here. What do, what does it look like? So that, that is some of the stuff that, you know, if you watch me on Instagram, I'm always doing the crazy. Nothing is ever super traditional. It's always outside the box. You don't need to be there yet. What you do need to do is question the property and go, is there something here? Is it at a price that potentially works? And should I send it over to Steve and can we make something happen? Right. And again, the more you practice, the better off you are. So that's, that's what this house will turn out to be down the road. So if any of you are operating or looking at, you know, maybe you set up a search in mls, right? This is one thing where you might find an MLS is owned land for manufactured homes. I will look at those all day long. And it's okay if it's in MLS for you to call the agent and go, hey, I've got a buyer. That's me, right? I have a buyer. What do you think the lowest price you'd take, you know, for cash? Or you do terms, right? Negotiate it out on my behalf, get it to a point that there's a conversation, then bring it to me and go, hey, I've got this deal. This is kind of where they're at. I talk to the agent, where do we go from here? That's the fun part, is like if you're not working with a buyer or seller right now, you got a buyer all the time. If we can just make the numbers work. And like I said in my post and everything else, if you want to increase your income five to ten grand a month without representing a buyer or seller, you can absolutely do this. If you will just focus and spend some time on it. Whether it's each day or once a week, the more you do this, the better off you're going to be. And the better off when you're out with clients, when you see something, you're like, oh shit, I need to write that address down because I need to come back to it, right? Because there's something here and that, that's where these things come from. And that's where the preparation starts happening. It's, you know, I was with clients showing homes in Sedona and we looked at a subdivision like this is a mixed use subdivision. There's manufactured homes and stick built. There's a lot for sale. Well, I just installed my first manufactured home, so I understand the pricing and the routine of it and what it costs. I'm like, there are 1500 square foot, 20 year old manufactured homes in this community that I just showed for 550. That lot is $100,000. I can put a 2,000 square foot manufactured home on it for 200 grand, making it a $300,000 property. There's a pretty good profit spread in that. But in our case, we're going to keep it as a rental for different purposes. But this is where you start getting really creative and you start understanding the zone of genius that your real estate license and the knowledge that you have and how to comp properties, how to look at properties and the knowledge combined with what you learned today. How does it change your perspective and how does it change your value for your clients, for yourself, for your future? That is the important part of understanding these numbers and using the spreadsheet that you all got. And if you signed up for the class, you got the email yesterday with all this stuff in it. And I would, I would practice it, practice it with clients home, show them the difference. Like, if we did it this way, this is what it would look like. You can actually take this sheet. So let me, let me share with you how to use this in like a seller situation to where you can point out the numbers. Right? It's, it's easy to do a net sheet, but the net sheet doesn't have placeholders for all this stuff. Right. So I'm gonna leave out the date purchased. I'm going to take this same deal and go, okay, we're going to change it to where I want you to picture this. The seller is, has these holding costs now. So you're putting in the stuff that the seller has, right? So let's say they owed 170 on this house. Amos keep their interest rate at 5. Right. It's not going to factor principal and interest, but it's, it's close enough in most people's mortgages. But on this one, you're like, okay, so seller, it's probably costing you roughly 12 to $1300 a month to hold this. And if you go through and we can sell it for 280 and you have to put $25,000 into the house, well, not 250. That would be awkward. It's going to take you four months to clean it up, get everything ready. We're going to factor in 1% for inspections, 3%, 3%, or however you guys want to use percentages in there because of the price range. You know, you got 1% seller closing costs, you're probably going to have some concessions. So we'll take a bottom of the road, right? You've just showed the seller what the flip looks like for them to do all this stuff. Okay. It's factored in their mortgage payments, their holding costs. Because a lot of times we're going through numbers. We're not factoring in the seller's mortgage costs and things, which is really going to come out of their bottom line. If they put it all in the same bucket from today going forward, this is what it's going to cost you. And it's coming out of the bottom Line. And sometimes we don't factor that in, especially with people with really high mortgages where it's like, God, it's going to be 20 grand. Where the holding costs. So am I better off just being done with this rather than continuing to go down that road? Okay, One of the rules of thumb when you're dealing with sellers, which is really important, is if we put a dollar in, we want to get two out. If you're going to invest in a dollar, you need to get a dollar return on or else it's not worth it because there's risk, there's headache, there's timing, there's contractors, there's all the things. Okay, so in this same scenario, if I go to the seller and I'm like, okay, what if we just sold it as is, oh, take one month, right? This is, this is where it kind of comes into play, where the numbers, where you're showing the seller like, hey, if there's no commissions, no anythings, you can profit 21, $1,000 and be done. You can take the risk on the 47,000, just depending on price. Right? Because there's no guarantee on what we're going to get for sales price. And you can kind of adjust that back and forth when it comes down to it. So this is what it looks like when we're explaining it to a seller and understanding what their mortgage is, what the time is, what the cost is, and understanding like, well, and by the way, what if, what if you're remodeling that and they want to do a kitchen and this one was I think, 1500 square feet. So if we use the same 55 a square foot, you'd be $82,000 to make it similar to the other houses in the neighborhood. And one of those questions, if we go back to the seller, questions is, do they have the means, money and time to make the repairs to do this? Some people we've all run into, they don't have 25 grand to put it in the property. They don't have that time. So if they don't have that time or wherewithal, then this is the next thing. And by the way, I want to give you a piece of advice. That person may not have the time or the money. You are earning your income by guiding them through the sale of the house, not doing all the things in between, getting the house ready and putting it on the market. Okay. I, I watched my dad do this for years. I did it for a little while, and I just refuse to do it now. I I'm not coordinating your contractors. I'm not meeting people over here. I'm not coming over here with an effing broom, okay? That's not why I'm here. That. That is not my strength. And some of us buy jobs, and. And we tried to maybe raise our commission a little bit to cover coordinating all that stuff. And here's what happens. What has happened in the past is we have felt bad because we referred a contractor to them that screwed something up, or we were supposed to coordinate it, or they did something wrong, or the timing, all the pieces. And so, you know, now, I mean, granted, you know, Wendy's the general contractor, but it's not part of my business. I tell people, like, hey, if 25 grand, you can meet with Wendy and see if she has time on her schedule to do these things. I can make that referral to you, but I'm not going to manage it. I'm not going to monitor it like that. That is just not what I do. You all have to make your own decisions on those things. I just think sometimes we take on jobs, and it's very unappreciated that we're over there, we're letting people in, and we're doing all this stuff. And by the way, if you. That's what happened with that tile job. I told this gal, Rene, I'm like, hey, no problem. I will coordinate with the tile guy. I will get him hired and get him over there to do it. He did a really crappy job. And guess who got stuck with it. Rene didn't call him and hire him. I did. And Renee refused to pay the bill. So the contractor said, well, you hired me. You owe me the money. And we had to fight through that. So be careful when you're doing things on behalf of your client that either a, you have something very specific in writing as to they have given you permission to do these things, and they're responsible for the bills so that you don't get stuck with those things because all of a sudden, you do all that well, number one, did you get a listing agreement signed ahead of time right before you started that process, or are you just doing it on hope and faith that everything is going to work out well and making sure that those lines don't get crossed and they're not blurred? All right, Garrett has some questions somewhere. Find the first one just to. Don't skip on. Okay. One of the things was asking, you know, do you buy with hard money or private money as you are moving through this? I use everything with private money. And what I mean, the difference between hard money and private money is hard money is going to be through traditional people. Capital Fund 1 LM2 Brad Fry all these people that are traditional hard money lenders, that's what they do. Their rates are higher. One of the goals in your sphere of influence is starting to have conversations about where people are investing their money and what their rate of return is by asking those questions. If somebody's like, oh, yeah, I've got a half a million dollars in a 4% money market. You're like, I can make you an extra 2 or 3% on that annually. Would you be interested? And it would be secured by real estate. This is how we raise the capital to buy houses. And we did it through our clients. I didn't go out and post Instagrams and do webinars. I did it one conversation at a time. And that is how we've continued to raise capital to buy houses, to solve problems, just like we do. The cool part about it is that when you have this conversation with a client, they have an amazing feeling about the investment that they're having. They're not just getting an 8% return from Apple, they're getting an 8% return on their money that's secured by real estate. And they are helping you. And when your investors and your clients see you winning, they love that. They love to be part of that investment. I have several older investors that are in their 70s that love to just have conversations like, how much money did you make on that one? How'd we do? What's going on? How's your family? What are you guys doing? Right? And that is a lot of fun to have. When you get to the point of those relationships where those people trust you with their retirement, with their life, and now you're going to it. You also have to understand, too, that you're taking on a very large responsibility that you can repay those debts and that you're not just taking things on. Okay, but when I first started, it was a lot of traditional hard money, and it was hard to operate because you've got to have 10 or 20% down. I think a lot of the hard money lenders are closer to 20 right now, some even 30. So you have to have that money to put down, and you have to have the money for repairs. So I couldn't do all the things that we were doing if I had to do traditional hard money. That's why I started figuring out if I can show my clients how to invest with me and let Me take the risk. They have the reward of just getting a constant 8% return and I take on the risk of the property. It satisfied both property, both people. Right. The investor didn't have to own the property. They, they weren't worrying about their profitability on the end of it. And that was how we started to create those relationships. So I encourage you to start having conversations with people and just asking questions. You know, where's your money? What do you invest it in? Would you consider investing in real estate if you didn't have to manage it or mess with it? Those are the things we start asking and that's where we started raising capital. We're using title reps. Actually we don't use our title rep to skip trace. We, we get a lot of different lists from lawyers, title and going through that. But I know that Brandon has a virtual assistant that's doing skip tracing. I don't know all the software to be perfectly honest with you. I know my numbers really well and I know to how to have this conversation with you really well. To dig the other things up is not my specialty. When it comes down to that stuff, it just isn't. We don't chase things down. We're more prepared for opportunity than we are chasing the leads, if that makes sense. One thing I want to mention, you know, as Christy asked about the, the title people, one of the things when you start getting into the investing and stuff like this, your title rep is going to make all the difference in the world. We've worked with lawyer's title for over a decade. Kim Holt is our title rep because she's old school. When you start getting the seller financing wraps the weird shit that we do, you got to have somebody that's very, very versed in it. So make sure that whoever your title rep is that you definitely have that piece in place. Because when you start getting creative and outside the box, some title companies and some title reps are like I'm not touching it, it's not the norm. Okay, so Gabe asked if my total monthly cost $1400. How are the sellers getting the $3000 that was in that spreadsheet? It didn't factor in a principal and interest payment. I did an amortization chart for them that gave them a principal interest payment. Most of the time we're just dealing in interest only payments. When we're dealing with our hard money or our private capital. On that one, it was just taking fourteen hundred dollars. And then you got to, you got to take all the additional holding costs out and we did the 200,000 that I borrowed from them and we amortized over at five years to basically pay the note off in five years by getting to that $3,000 a month, which ended up being 5%. Got it. Thank you. Absolutely. Donna asked how we run things to the broker. Okay, so I think Lindsay had also said something about this. Here's the deal. When I, when we buy a house, I can even pull the. I'll pull the contract up in just a second. When we buy the house, we use an AR contract just like normal. The only difference is, is it, it has a bunch of verbiage in there that I'm a professional investor, I intend to make a profit either by keeping the house or flipping the home. And then it goes on into page nine where it's just the seller is unrepresented. And then there is a for sale by owner or the unrepresented seller agreement where we put the commission in there. So by doing all that, everybody signed the disclosures, it's all in there as to how it goes. And then it's just taken into the broker and a commission is paid at closing just like normal. Because we have the for sale by owner agreement. The reason, there's two reasons we use the for sale by owner agreement. One, it does cut that agency relationship, right. Because some of us are being called out as a listing appointment. And it turns into we went through all these numbers and now I'm going to do a for sale by owner agreement so that I can kind of cut that tie and then move into now I'm going to be the buyer and then explaining to them that once I get to a net number, so say it's $200,000 and I want to bring $10,000 in to limitless Real Estate Strategies and I need to pay you $10,000 referral fee. I'm going to tell the seller, hey, this doesn't impact you at all because it's a cost of sale. So for tax purposes or anything else, but I'm going to raise the price from 200 to $220,000. And you're going to agree to pay me a commission on this. This is how I keep the lights on in my building and how I pay payroll. And I haven't had anybody kick back on that. Right? So now I have those documents. I submit everything to the broker, submit everything to title company title pays the referral fee. That's instructed. And then they pay real broker, which is where I'm at. And all that goes in and Flows just like normal. Here's the piece is also very important as to why we do this. I had actually Brandon I it we were having conversations we first started. He's like, I don't understand why you're doing this. Here's why. Okay. If you start doing flips or you're doing wholesaling, depending on how your accounting works as real estate agents, this is our primary business, right. This is, this is what our taxes are based on, this is what our income is based on. This is how you qualify for things in the future. Some people say like, well you're just going to get taxed on that 10 grand. Yeah. And when you flip a home you get taxed at the same amount of money. Okay. So If I make $40,000 on a flip, I'm still taxed at 30%. If I pay $10,000 in commissions, I'm taxed at the same rate. Because a flip is ordinary income every time. The only difference is on flip income that's sporadic off book income. You can put it into your P L but it's not consistent income. Guess what is my 25 year career in real estate where I'm taking profits pre profits from the property and paying myself in order to do two things. One, keep my P and L very bolstered for the banks so that I can qualify and I show income. And number two, it goes back to the brokerage, right? I'm investing, I'm paying my caps, I'm doing my things, I'm trying to get there as fast as I can to my elite status so that I can receive my shares that I get for hitting that. And if I pay myself to do it, guess what? The rewards that I get down the road are very, very intriguing. And that was why I'm like, well I'm going to play the game and this is how I'm going to play it. I'm going to pay myself to buy houses and I'm going to meet my caps and I'm going to take my stocks and my stock match and all the other things. It's another side of the investment. That's why I started doing it. So that's how I get it from into the brokerage. Oh, do I ever rent to own? Yes. You know, from Amy, we've done lease purchases, I've got a couple of clients and lease purchases in that again, whole nother topic. It's a really good exit strategy. Sometimes out of a flip that might be a little bit less profitable where you can kind of go down that road. So yes, we do do lease purchases. Part of it is knowing as you, as you go forward. Right. The purpose of today was knowing the numbers and knowing that there's another source or stream of income to allow you to be market proof. Now if you move forward in this now, it's kind of the next phase. What if you find something like 66, you're like, I really don't want to keep that as a rental, but I got seller financing. Well, I'm just gonna turn around and do a lease purchase. So I'm gonna sell it to somebody for $300,000 on terms, and they're gonna put $10,000 down. They're gonna lease it for $2,200 a month, and then they're going to buy it in the next year or two. You're not getting a whole lot of profit up front. You got a little bit of down, but if it was gonna be a rental property anyway, it might be worth it. Right. And by the way, if they do a lease purchase, you also have the option, if you made $100,000 on that to 1031, exchange that and not have ordinary income tax on it. That's the problem with flips that a lot of people don't realize is like, yes, it shows a hundred thousand dollar spread, but after you pay cost of sale and you pay taxes, the profit really isn't that great unless you're doing it in volume. Okay. That's why I prefer to keep things as rentals when I can, or at least rent them out for a year and then sell it and be able to move the money into another project because it makes more sense if you can afford to hold it. Maybe you have a partner. This is where we start creating wealth and we start creating future legacy. What else you got? That's another buy box. Got it. Okay, well, these are the numbers and the stuff. This is the important part of it. So what's next? How do we go through this? How do you start this process? How do you get really good at it? Okay, first of all, I want you to be as confident in yourself, as a buyer, as your confidence in what you sell to buyers and sellers, as representing them as an agent. This, this is like the most critical piece because I guarantee you, every one of you would raise your hand right now and said, if I knew how to do this 10 years ago, I don't know how many opportunities I missed. And this is the regret I'm hoping to stop right now is that you never look back and go, I wished I would Have I do enough of that looking at my dad? I do enough of it in my own career. You know, Brandon worked with me during the foreclosure days. It really sucks to look back and go, I wish I knew. I know now, back then, right? I totally botched that saying. But you know what my thing is, right? If I had all this knowledge right now and I applied it back to 2008, rather than running around vacant shitholes, fighting with homeless people and stripping the wires out of things and making $750 after managing a house for seven months for Fannie Mae, I would have been raising capital and buying the $20,000 homes, and I'd definitely be retired at this point. But I didn't have the mindset. I didn't know how to raise capital. I wasn't financially literate. I didn't understand it. And so I'm hoping this makes a huge impact in your life is understanding, Holy shit, I have a real estate license. This is what the opportunity is, and it is so great. But so many of us spend our entire career serving everybody but ourselves. And I want you to kind of sit back, like on the airplane and think about the oxygen mask coming down. And what do they say? Put it on yourself first and then your kid. And what we've done is, if this kid is your client, we are constantly putting the oxygen mask on them, and we are depleted. And we're not taking our skill sets and we're not applying it for our own benefits. By the way, you have absolutely every freaking right to find a deal that's at 50 cents on the dollar and keep it for yourself and not bring it to an investor, not bring it to me. I learned that the hard way. I watched my dad sell his soul to Satan every time he picked up a great deal. And that jerk would pay my dad, like, three or four grand and he'd make a hundred. And I just. I refuse to do that. And I hope that you will see that and stop, you know, doing everything for everybody else and start thinking about yourself and your own family. Because what I don't want anybody on this call to do is experience. What I experienced with my father is looking back and going 40 years in this business serving people, making people money. What do I have to show for it? We have one of two ways to get there. You can grind it out, have a big team, do a gazillion sales a year, and be putting money away, which is your own money. Or you can take your skill set and your knowledge and you can go create Money. That's what we're doing here, right? Just by these strategies today, you can create money doing this. And it's going to be income right now, but eventually you're going to be able to create equity, you're going to be able to create other sources of income and understand what the value of having your real estate license is and the value of the knowledge that you have in your market. And the more knowledge you have, the more things that you have, the better you serve your clients and the better you serve yourself. And I think that that is very, very important to understand. So let's talk about this, right? Practice is everything. I recently spoke to about a thousand agents and I asked how many of you are taking time every week and scheduling an appointment on your calendar to serve you as a client. You see, in my business, I am the investor. I am also the acquisition person. I am also the realtor over here. But I take time for me as the investor and I will go and practice, I will look at properties, I will take pictures, I will like, eh, I'll take Wendy to go look at something. She's like, no, right? If you're not doing it, it's not going to happen because all of a sudden opportunity is going to rise out of nowhere and you're going to have a panic attack. And not how to capture it. This is part of knowing how to capture it. Take wholesale emails. We all see them, right? Look at what they're pretending the value is and what the price is they're selling it for and plug it into the spreadsheet and go, does this actually work? It may or may not. And compare it to the emails, right? Or compare it to the comps. It's important that we do this and we schedule an appointment back to what I said. Out of those thousand agents, 00 people are taking the time to be the buyer. And I think right now a lot of us have the time to do it. We're just not willing to do it. And we sometimes don't see the value in doing it. Fill up that spreadsheet every time, Plug it in, play with it, tweak it. What if I could get to this? What does this look like? It's just going to make you better at what you do. Schedule a couple hours a week, put it in your calendar, do it. Talk to your spouse, your partner, team member, somebody. Do it with somebody. Go through it, have some fun with it. If I gave you right now, I want you to think about this. If I gave you a half a million dollars of monopoly money right now. How would you spend it? It's all you have. So your only goal is to grow it. So how much risk are you willing to take? What do you have? And the reason I say that if you're not practicing these things and all of a sudden tomorrow you inherited a half a million dollars, do you know what to do with it? Do you know where to put it? Do you know how you're going to grow it? In your knowledge? You know in the, in the book the Millionaire Next Door, the one thing he talks about about these 10 millionaires, he studied every one of them use their zone of genius in their career to influence their future wealth. They didn't just work in it like an auctioneer. He was like, oh yeah. He's like, I get dibs on so many great things because I know the value of that piece and when it doesn't sell at auction, I get to buy it. Same things with houses. If you start understanding the value and the knowledge that you have, you see things different than the general public does, which allows you to capture certain things. Okay, working with Brandon and I, I'm going to tell you right now, these deals that the email address that's up here, that goes to Brandon and I, Brandon's going to be first look on it, having the conversation. He may reach out. You can also reach out to Brandon. All this information will also be in the follow up email that comes from this. We want to work with you. There's going to be some training, some different things that goes through it, but we want to work with you on stuff. We want to figure out how to solve problems together. Right? Best way is just start the combo. What is the seller's situation, what's the condition of the property, what's their timing? And a lot of photos. We buy a lot of houses on photos. It kind of like gives us an idea because I can factor, you know, by looking at the one front photo on Carol, I can tell you it's going to be a full one. It's going to need 90 to $100 a square foot. Good news is, is you've probably already had that conversation with the seller when you've been there. Because we've had this conversation here and if you're using the spreadsheet, you can show the seller real quick what it looks like. Okay. So you know, in the future you can take this email if you have something that's questionable conversation whatnot, as much information as possible in that email. If you need to call and go through it. That's okay too. It's just if we have the address and then I can call you back because I've been able to research it and I have some stuff. It makes it a little easier and a little quicker for us to do that. I'm going to ask for some love, some shout out on Instagram today. Any takeaways that you guys got really important. The other thing too, if you haven't. I want to open your mind to what is possible. Okay. I took an 18 month journey. I worked with a ghostwriter. I published my first book in June. Super excited about it. Here's, you know, the comments and things that I'm getting from people is it's just an eye opening scenario. I go through a lot of the craziness in my life from when we lost everything, how we built it back up, and how we built what we built over the last eight years. And I want to give you guys some, some ideas. I was doing exactly what each of you is doing right now. Eight years ago, 2015, when my dad passed, my eyes were opened up to what my dad was doing on the investing side. And I looked at and I said, if we just tweak a few things, I think this can be part of our business. It can be another arm and another leg. And we started going down that road and we started to see things and experience things and we started to put things together and put our contracting teams together and it started to snowball. And so what's going to happen is you're going to start seeing these things and it starts snowballing and you're like, oh my God, this is so amazing. And it's so much fun because I can still work with clients, I can still do the investing side, I can work with you guys. And it just makes the life of being a real estate agent or strategist so much more fun. So I'd encourage you to order the book. Garrett, put the link in in the chat. It's really just going to open your eyes to philosophy and how we built what we have over the last eight years from being a traditional real estate agent. I didn't inherit any money. My dad died broke. Nobody gave me any money. All I did was take the knowledge and the legacy that my dad left me and I started to apply it and I started to learn things. The only difference that you guys have a leg up on is nobody was there to guide me. I learned by the braille method. We've lost as much money as we have made and it sucks to learn that way. But I guarantee you like being around, being in the ecosystem that I live in. Reading this book, you will start to see things and you don't have to go through the hard things that I did when I did it. And by the way, we'll point something out here. As you know these numbers and you go through these things, the goal is to eventually start keeping homes, right? Whether it's one a year or two years. So here's what I'll leave you with. And I would encourage you to dream. What's your dream life budget? What do you need to operate? We talked a little bit about this earlier. What do you need to operate? Is it ten grand? Is it twenty grand a month? Maybe it's five grand. I don't know. What's it going to take to get there? In real estate, every one of these deals that we have bought and gone through, you know, we've gone through our specific systems on how we buy things. It's allowed us to take something with a massive amount of equity in it, repair it, refinance it, and keep it. Because we created the down payment. We didn't have a gazillion dollars to put down payments on the 96 homes that we own. We created the equity by understanding how to negotiate what our repairs look like. And we started going down that road to build that portfolio. You may only want a couple of properties. Some of you can still house hack your way to your future by living in them. Right? Here's a little tip, just so you know. Crazy piece, actually, I want to. I want to see this. Garrett, everybody, type A1 into the chat. If you don't currently own a home. No, just a primary residence right now. If you don't own a home, throw it in there. Few of you. Crazy piece that I want you to see. If you took any one of those deals we just did the numbers on as a realtor, slash investor, you can go buy one of those deals as an investment property with hard money. Get it fixed up, don't sell it. You're going to go move into it and you're going to refinance it. Owner occupied. You're going to have a boatload of equity in it. It's going to be remodeled, and it's going to be something you keep as a rental. It is a crazy scenario. What can absolutely be done right now? And for those of you that have a bunch of myths holding you back, I'm telling you, I break all of them in the book. There's nothing off limits. Here's what you have to be willing to do, you have to be willing to invest. Some of you are like, what's he gonna sell? I'm not selling anything. I'm telling you, you have to be willing to invest in yourself. I did this class today to simply give back to the industry that has been so great to me, and it has created a ton of wealth for us. And I believe that the more knowledge you have, the more we win together. And the mindset has changed, and we serve our community and our clients way better than we could traditionally. Right? So I'm not selling you anything. Just an FYI. I'm totally giving this to you guys 100% out of my heart and out of gratitude for where I'm at in life and where it's done right. These are all things I've learned the hard way, and I'm trying to make it easier for you. But there is this one piece, right? If you're willing to invest in a mentor or a coach or something, when it comes down to one of these deals. Hey, I found this. I really want to keep myself. What's the investment to have you walk me through this system? Okay. It's a conversation we can have. Don't try to do it alone, because I guarantee you the stuff that I've learned on how to refinance these things and how to move stuff, it all starts when you buy the house. And if you screw it up when you buy it, you can't fix it after that. And it's just really important to understand that. So if you're in that position, you're like, I do want to buy my first home. I would love to do it that way. What does it look like? I'll coach you through it. There's going to be an investment because it's my time, right? And I only have so much of it. And. And I gave as much as I could today because I love our industry and I think we can be better. And I don't want anybody to ever end up like my dad. And I want to be able to have better relationships with each and every one of you so that we can all win together rather than this constant industry pissing contest. Hey, Mariano, are you still on? Yeah, I'm here. What's the question that you asked? Contact info. Oh, for hard money lenders. Private money lenders. I don't give private money lender information out. That's. That's something that's sacred in my company. Hard money lenders. Yes. I will share the couple of contacts that I have beginning investors. Yeah, the falling short or hesitant to do a deal for, for yourself. I totally understand that. One of the things that I did start early on was I partnered with people that had money. I did all the work, we hired the contracts, we did the things, they paid all the bills and we split the profits. That was the way that got started. And the more they trusted us, the more we able to lean into the relationships with them. Starting off with hard money is very hard because the relationship has to be established and we're going to have to have money to do it. Now, I will tell you this. If you have equity in your home or you have maybe a rental property that has some equity, some of the hard money lenders will do what's called a cross collateralization, where they will basically attach a second position against a primary or secondary so that you don't have to put anything down. You just have to remember what you're sacrificing by doing that. So you want to be careful with it. That's why, you know, when you're in the beginning stages, you want to look at it, you want to practice, you want to make sure you're not jumping in too deep without having some sort of safety net. Yeah. Danny, thank you, Steve. Yeah.

Hey, Steve, thanks for putting this together, first of all, and absolutely, I, I, I hear you loud and clear. I took your dad's classes back when he was on 16th Street. As a matter of fact, I might have met you because he just, he did introduce the boys. But like your dad, I was one of those that made three to five thousand dollars per deal while, you know, the investor guys made the money. And, you know, if I had to do it over again, I'm smarter. A different approach and thinking about getting back into it. You know, it's a little bit tougher to do than it was back then. Pretty much did it from 2008 to 2012. Small book investors and made several of them pretty wealthy. I didn't have the capital to do the means and more so the knowledge to do what it took. Kind of hindsight, 2020 should have a different approach. But anyway, the question I have is back in the day, I would walk into a Property and within 15, 20 minutes know @ a glance how much money we needed. You know, a dollar a square foot to paint, dollar a square foot to, to put flooring in there, cabinets for ten grand. And in ten minutes we can throw some quick numbers because it's a pretty fast moving game. We were buying properties down the courthouse with John Ray. So my question to you is, do we have kind of rule of thumb numbers at a glance that we can walk into a property? And I know that material cost and vendor cost, everything else has increased probably threefold. Rule of thumb, you know, what kind of. What kind of cost we're looking at? Flooring, General.

Yeah.

Flooring, paint, that kind of thing.

Yeah. So general costs, I'd love that. You know, I do the. The bigger breakdown of about 50 to 55 a square foot for a house, which is a quick, easy number. I'll give you some breakdowns. This comes straight from my wife, so I know how expensive it is. You can, on average, plan for $10 a square foot in a house. I don't care if it's tile or carpet. For demo removal, it's about $10 a square foot. Flooring is not cheap. Okay. Obviously, you can cut costs and buy cheaper tile, things like that. But that is our average from our P. Ls over the last 12 months is about $10 a square foot. And I don't care if that's laminar tile. It's not super high end, it's not super low end, it's medium end. On paint, you're about three to $3.50 a square foot right now. Interior or exterior? Okay. The average kitchen with appliances is about 15 to $17,000, including granite appliances for, like, your average small kitchen. Bathrooms are probably between 5 and $7,500 right now. Okay.

That'S good. So kitchen, you were looking at 15 to 20, you said?

Yeah. Okay. All right.

Everything's gone up considerably.

Yeah, it's gone up extremely. Like, I mean, I remember we used to buy kitchen cabinets for the average kitchen for about 2,700 bucks. And they were good cabinets. And now I think our average is about $7,500 just for cabinets.

Right.

Okay. Well, thanks. That helps a ton. And again, thanks for. For putting this on.

Hey, I've got a. I've got a question for you, though. Yeah. In those days when you were working with those investors, did it. Did it ever cross your mind to try to borrow money from those people or try to partner with them rather than just doing the legwork?

Well, I'll tell you what. And you know, you know, the market kind of dried up pretty quickly. Most of the guys that I was working with were working with people that they were borrowing money from. And yes, I considered it, but again, I was kind of working with blinders, if you will. And just looking at the deal in front of me, looking at the deal in front of me. Toward the end there, I was given the opportunity from one of my investors. At that point he had pretty much 15 properties that he owned outright after coming to me with a $75,000 credit line. And he offered to finance 100% deals for him because I made him wealthy. And at that time everything kind of dried up overnight. So my opportunity just kind of went, went by the wayside overnight. But again, the knowledge didn't go anywhere and I'm looking to get back into it now. And that's why you're. The opportunity to be here today was huge to me. And just seeing your success in, in what I, what I figured, what I feel is a short time.

Thank you. You know, it's. My dad was such a great man. He was so knowledgeable, but he just chose to keep putting the, the oxygen mask on everybody else and it was kind of to his detriment. Not that he couldn't have done both, but at that time it just. I always go back to it. I know Brandon and I have the same conversation all the time. It's like the amount of twenty thousand dollar homes in Maryville that you could have paid 22% interest on and put a fence around it for a decade. Yeah. The amount of money that could have been made in those times just, I always like, I just want to cry, I want to crawl a ball. But here's the deal. The two best times to plant a tree, 20 years ago and now. So it's never too late to start. And doing this for, for you guys is about being prepared for opportunity. It's not like some of us will search the opportunity. And as you go on and more people know you're investing and doing things like what we're doing, they will bring you opportunities, but you have to be prepared to capitalize on them. And if you're not prepared to capitalize on them, they just flow through. And being prepared has to do with mindset and has to do with risk, reward and all the different pieces. And some of you are going to take a little bit slower approach and that's okay. Just don't do what we tell our buyers not to do. Like keep in the game, buy a house, don't worry about it. Like it'll be okay. Right. And that those are some of the things where we just kind of keep learning and keep doing so that we don't miss the opportunities. Right. And you only miss opportunities if you don't understand the numbers. Because the numbers is either it'll either make or break you at the end of the day, and that's why I wanted to do this for you guys, is just so that you understood the numbers and where my brain thinks. Thanks again. So thank you for that. Anybody else got any questions as we kind of wrap up here? You are more than welcome, Jamie. All right, I'm gonna let you guys go a little bit early. I am so humbled, the amount of people that were here and that you hung in there for this two and a half hours with all this craziness and numbers, and I'm sure you have some brain fry. You are going to get a replay of this so you can go back and watch it go through the numbers. You have the spreadsheet, and I just encourage you to start practicing, start getting into it, start figuring it out so that you are prepared for this, whether it's now or in the future. And remember that, you know, I'm always the buyer and we can always work together on things and don't ever feel like, well, I don't want to call Steve because of this. Here's the deal. I guarantee you, it's kind of like, I want you to consider this. It's very similar to my investment in my cpa. Every year, it's a shitty cost, but I wouldn't do it without her because she saves me or creates way more, you know, less tax liability for me every year. So there's sometimes I'm going to see things that you don't, and I'm going to help cover your blind side, which could increase your income. Right. That's why we're here. It could increase your wealth. It's definitely going to increase your knowledge. So don't be afraid to reach out. Let's figure this out together. Let's make it great. And I appreciate you all for showing up today, and I hope you have an amazing day. And let's go. Let's go create some opportunity and serve some people. Hold on, there's some more. I just put the new podcast because you're having these conversations live. Yep. The other thing, too, that you guys might be interested, I haven't done a lot of pushing on it, but Garrett just put the podcast called Real Estate Revolution in there. I do a lot of live coaching on that podcast. We're breaking down deals, different things. A lot of knowledge in that podcast. You know, if you come to me and you've got something, I may send you a link and like, hey, let's cut this up on the podcast because it creates good content for both of us and it's something that I do enjoy doing. Thank you for reminding me that. All right, everybody, have an amazing day, and let's go solve some problems.

Good job, Steve.

Have a great day.

Thanks, brother.