The Blueprint To House Flipping—Everything You Need To Know

Hey, it's Mark Podolski, the land geek with your favorite niche real estate website, www.thelandgeek.com. and before we talk to today's guest who is kind of a big deal in real estate passive income too, I would be remiss if I didn't properly introduce my co host, Six Sigma, the automation specialist himself, Scott Todd from Scott Todd.netlandmodo.com and most importantly, not automating your Craigslist and and your Facebook postings. Posting domination.com TheLangic Scott Todd. How are you, Mark? I'm great. How are you? I'm great, I'm great. Are you excited about today's guest?

I'm exhausted just hearing what all he's got going on. So yeah, I can't wait to hear his story and to get some nuggets from him and I can't wait for him to hear about our passive income model.

Yeah, yeah, absolutely. Yeah, absolutely. So before we talk to our guests, I just want to remind the listeners today's podcast is sponsored by posting domination.com thelandgeek because let's face it, Scott Todd, when you can press one button and put up 124 ads, you're dominating on Craigslist.

And you know what, they got a stick too, right? And that's what we teach in posting domination is how to defeat defeat. That one website Craigslist algorithm. Maybe they'll buy Posting Domination link for everybody or buy it and take it off the market.

There you go. There you go. Well, our guest today, I know could take advantage of posting domination because it's Mark Ferguson from investformore.com. if you don't know about Mark, he is a professional land Investor. He's done 120 flips. He's currently working on 16 flips. He's a real estate agent with a team of 10. Mark Ferguson, you're a big deal. Welcome to the podcast. How are you?

Hey, great to be here, Mark. Thanks for having me. I'm excited.

So Mark, how does Mark Ferguson start as a real estate agent and then go into the house flipping real estate star that you've become today?

Well, I got my degree in finance back in 2001. Couldn't find a banking job which is what I wanted. So I went and worked part time for my dad as an agent and that turned into a career and he flipped houses once in a while and I kind of fell in love with that part of the business and built that up and up and up and ended up buying him out eventually and taking it over and just trying to keep building bigger and bigger.

So what. What do you like about house flipping and what don't you like?

I like seeing the houses turn into something different. You know, I like going there, making repairs, sometimes changing the floor plans a little bit, adding value. And I like to say I'm addicted to buying houses. I mean, I just. I am addicted to a good deal. I can't help buying more and more and more. And that's really the fun part of it. Whether it's rentals, whether it's flips, I just love finding those great deals. And there's some very stressful parts of flipping as well. I mean, finding contractors is a constant struggle. We're starting to build up our own crew because it's such a hassle finding good contractors. You find good ones, something happens to them, they stop working as hard, they start charging more. And, you know, there's just issues you have to deal with when you're doing that many flips. Like yesterday, you know, we had an inch and a half of rain in 15 minutes, and one of the basements flooded. We had hail damage on other properties. And when you have that many flips going, you know, a storm becomes a really big deal. Trying to get everything taken care of and check on everything.

Wow.

Scott. Todd, what do you think?

Well, is it. Is it the excitement of the deal that you like to hunt down, and then, like you said, that you like to. You like to see what it transforms to, right? But flipping is not that easy, right? So why is it that there's this. There's this draw in the marketplace to, like, these to be a flipper, right? Like, what's the draw?

I think you're right. It's really. It's not that easy. I mean, there's a lot that goes into it as far as figuring costs, making repairs, getting your numbers right, and finding deals is not easy. And I think a lot of it's been glamorized by television. You know, you watch HGTV and the shows. They make it seem so simple. Like, oh, you just pick up a deal and then you do some repairs, and then maybe there's a hiccup or here, you know, here or there, but you make $100,000 on a deal, and I think people see that, and they think, you know, they can get it done on the weekends, and it's not that difficult, and they make all this money, but there's so much more to flipping that they don't understand. And that's really the difficult Part and the stressful part. And that's why you see so many people jumping into it. Plus, you know, you've got the big companies, you know, teaching people at their seminars and charging big money to try and glamorize flipping as well, which I think draws out a lot of people who think it's going to be simple and easy and just a weekend job.

Right. So if you could do it all over again, Mark, what would you have done differently?

You know, in the beginning of my career when I was an agent, I had very few goals. I was not really into self help. I was kind of thought I could do it all myself. So I really started to see success when I started setting goals, going to conferences, really trying to work on myself. So one thing I would do earlier is just really network with people, learn from others, find people who could teach me. I had my dad who helped me, but I didn't listen to him very much. I tried to do it on my own still and just listen to people more, be willing to not think I could do it all myself. And then I would have bought rentals and properties much earlier because flipping is a great income, but it's more of a job than it really is investing because once you sell that house, you're done. So rentals, I think are really a key to that passive income building wealth where flipping is more of a job.

Yeah, I mean, I learned that the hard way too. When I first started, I just flipped, flip flipped. And I really, you know, regret it to this day. It was one of my biggest mistakes for sure. If, if you're going to say that you only could invest in one class of real estate right now in today's market, what would it be?

That's tough because I started out with single family rentals. That was what I really liked. But you know, is 2010 to 2015 was when I bought most of my rentals. When the market was down, rents were still pretty high. You can get amazing cash flow in my area. And I'm in Colorado where prices have gone from 110,000 to 260,000 for median values. So it's been incredible appreciation. And rents haven't gone up that much, so they're not really that great of a draw anymore. And what I've really moved into now is commercial. So I started looking at kind of industrial flex space, shop space, warehoused conversions that are easier to manage, kind of. There's a lot of opportunity for growth and there's huge demand here right now for it.

I like it. I like It. What do you think, Scott?

So is it that you're again, like, are you chasing the deal, or do you just. Do you think that the market changes to where you have to do that to sustain? Like the move to commercial? Is that because you wanted to or really because the lack of, like, deal flow?

I think it's both. So I think the lack of deal flow forced me to do a couple of things. And the first thing I did was look for a new market. So, you know, I went. I looked at Florida, I looked at some other markets where prices were much lower, rents were higher in comparison. I even bought a property in Cleveland as a turnkey rental. And I really like those markets, but it's not easy to buy out of state, you know, when you're 2,000 miles away. So I kind of put that off. Put that off. Then all of a sudden, you know, my flipping business has been taking off, and my project manager, Nikki's like, you know, we really need shop space. We need somewhere to store all our materials, all our stuff. I'm like, okay. And I started looking into shop space and commercial, and I saw this opportunity there, and I got really excited about it. You know, I saw this opportunity where you could take buildings that weren't managed well or were vacant or needed some kind of work and kind of, like large, know, multifamily apartment buildings. You could, you know, raise the rent, add value, and really increase their value based on better management, better use of the property, and kind of seeing the scale you could do with some of these properties was really exciting. Got me completely out of my comfort zone and really challenged me. So it came from necessity, but it turned into something really exciting and really fun.

How are you going to finance this stuff?

That's the tricky part. You know, there are local banks who will help me, but, you know, they're doing 70% of the deal. They'll do some of the repairs, but then some of my own cash will be involved. Partners will be involved. I've got a couple partners who are working with me now. I actually have a deal under contract now. That's 280,000 square feet. So that's a bit of a challenge, and it needs a lot of work. It's been vacant for 13 years, so, you know, I'll probably be making more repairs than the property costs. But, yeah, definitely need partners contracting. You know, finding people can work in a place like that is a challenge. Completely different than flipping. And it's. It really has gotten me out of my comfort zone. It's been exciting and stressful at the same time, but it's fun.

So there's a. There's a. There's a building that's in my hometown. It's. It's one that, growing up with, I drove past it on the interstate all the time. It's. It's a. Like an office kind of a complex, you know, And I keep driving by this thing and I tell my kids, I'm like, that I want to buy that building one day. I want to buy that building one day. Because it's not like I remember when it was, like, newer, you know, like, it was in better shape. And it just. It needs some, like, it needs repair. Okay. I even, like, have dubbed it. My last name is Todd. I've dubbed it Todd tower. You know, the kids kind of get a chuckle out of it. But deep down inside, I really think that there's an opportunity. Where do I find the money? Where do I find the partners that can help me put in that money so that I can make my Todd tower dreams come true?

You know, most of my money comes from other investors, Real estate investors in the area. And they've helped me. You know, they've invested money with me on my flips because they've seen me doing it for so long. They've seen my experience, and they're familiar with real estate, so they're really easy to work with. You know, you don't have to do much convincing with them. If it's a good deal, they see it and they're like, okay, sure, I can text one guy and say, hey, I've got a new deal. Do you want to fund it? He's like, yeah. Doesn't mean ask for the address anymore. So it's just a matter of, you know, are you going to pay 10% interest or what are you going to pay on it? So I think you start with people, you know, networking. Those are the people you always start with, is who you know in the area. A lot of times, you know, people have a lot more money than you think and just telling them about certain deals, telling them what you're doing, you know, we have to ask them. Sometimes they'll start to inquire and get curious, and then you can, you know, go deeper and deeper into what you're doing. And then besides that, my plan is to go for some of the bigger fish in my town. I know there's a couple of people doing some big developments. My town's 100,000 people, so it's not huge. But there's one family that's bought 18 properties and a couple blocks. We're planning to do some major developments. They put up a new hotel. I know who, some of the investors are there. And then some of the investors who are investing with me are like, hey, I've got a buddy, I've got a friend. I know someone. My lawyer's like, hey, I know someone. My CPA is like, hey, I might know someone. You just got to network and talk to as many people as you can.

So you know, I know you've got the podcast, you've got a forum, you help people learn how to buy and sell real estate. What's the typical newbie question you get about flipping?

I think a lot of people ask me just what do I do if I don't have any money, how do I get started? And it's tough because it's not easy to flip without money. You know, there's some hard money lenders out there who will lend you a lot of the deal, but most likely not all of it. If you can find partners like we just talked about, local people who can help you out, that's probably the best way to do it without money. But what I tell people is, you know, one of the best ways to get started in real estate, whether it's flipping rental, is to use your owner occupancy qualifications to buy a house, live there in a year or two, then sell it or rent it out. And you can buy with so much less money and it might take some time, it's not going to happen overnight, but it's one way to get started. And so many people I talked to, I'm like, have you talked to a lender? Like, no. Like go talk to a lender. Even if you know your credit is horrible, they can help you fix it. They can tell you how bad it is, they can tell you if your debt to income ratio is bad, they can help you fix your own financial situation. So I mean, even if you're wholesaling, even if you're doing off market stuff where you don't plan to use a loan yourself, at some point you may, and the sooner you can fix your own financial situation, the better off you'll be.

I like it. I like it a lot. So let's talk about your dad for a second. What would you say was the biggest life lesson that you learned from your father? Especially in real estate?

Yeah, I mean, to do business the right way. So he was an agent? Well, he still is an agent but he's retired. He doesn't do any deals anymore. He started in 78, right before I was born. And he was very well known in our community for a very long time. And the biggest thing he was known for was being honest and putting his clients above himself. And that got him so much repeat business. So many people respected him and so many people trusted him that, you know, at the end of his career, he didn't have to advertise, he didn't have to market. He had people coming to him. And you can use that same mentality in investing as well, where, you know, I haven't backed out of a contract in probably four years. You know, if I say I'm going to do something, I do it. I don't play games with inspections. I'm not trying to beat up sellers over nickels and dimes. I try and build my reputation as if I say I'm going to do something, I'm going to do it. And now I have agents coming to me or sellers coming to me trying to give me deals because they know if they're in a tough situation, I'm not going to mess around with it. I'm going to make it right. I'm going to do what I say I'm going to do.

Yeah, I think it's a great lesson about patience and trust, right, Scott?

Yep, that's right.

I mean, you know, a lot of people, you know, they give themselves, let's say 90 days to start establishing something in real estate. It's not enough time to build a track record. I mean, it takes patience, it takes grit, it takes, you know, a constant supply of energy and action and motivation. And Mark, what other adjectives would you add to that to, to say, okay, you want to be a successful real estate investor, this is the recipe that you need to follow.

And patience is huge. Like you said, it takes. It's not going to happen overnight. I mean, even if you're trying to do, you know, there's so many people trying to sell wholesaling as, you know, get rich quick with no money involved. It takes a long time to set up a direct mail campaign. It takes a long time to find motivated sellers. Same thing with rental properties or fix and flipping. You've got to learn your market. You've got, you know, find contractors, learn what repairs cost. There's so much that goes into it. And being patient, persevering, really studying and educating yourself as well as just, you know, making sure you take action. At the same time. You don't have to buy a house, but going out and seeing houses, talking to lenders, talking to CPAs, whatever you can do to get yourself out there. The sooner you start, the sooner it will happen. But like you said, it won't happen, you know, for a few months at least, sometimes much longer.

Alright, so you're gonna have a dinner party, Mark, of your three favorite real estate investors or podcasters or whomever it may be. Right. Who would you invite to dinner and what question would you ask them?

All right, I would invite Jay Scott. He's a well known flipper, wrote a really good book, the book on Flipping Houses. So he is from the corporate world and super smart. I mean really smart. So I would pick his brain over and over again just about the mentality of how he runs his business because he does so many different things. He's got inventions and all kinds of stuff going on. So I just want to pick his mind on inventions. I think even though they're one of my biggest competitors, BiggerPockets is a great site. They do a really good job. Brandon Turner would be fun to have and talk to about, you know, he does a lot of great YouTube videos. He does a lot of great, you know, writing as well in his books. He's also an investor right now in today's market. You know, he's not one of those, you know, people who did things 20 years ago and still, you know, trying to teach people how to invest. So he would be a good one. And finally, I think, boy, I would say, well of course you, but I can't count you because you've already got your own show. But flattery will get you everywhere. I already had you on my show.

So obviously I know.

Boy, Jay Henriks is someone who doesn't really have his own podcast or show or teachings, but he was someone on my podcast who was really, really good. Has done land development, developed timber, done hard money, done land, you know, subdivision development is a broker, Turnkey Rentals just did so many things in his career. I would want him to just pick his mind on business and you know, how he's progressed through his career from spot to spot to spot and just finding more and more opportunity.

Yeah, I think that's, you know, those are really good people to definitely have for dinner. Scott Todd, who would I have for dinner? Well, what do you think of his guests?

I like him. I think that, I think that the fact that you're not necessarily going after people that you can, you know, that, that are just in your circle there, the people that are, that you want to learn from. And it sounds like you've Got a distinguished list there of people based on intelligence and other. Other things. I think a lot of times people get caught up into the fact that, you know, they. They're either afraid of somebody, like, like you said, Brandon, maybe you and Brandon compete against each other. Hey, embrace the competitor, right? Because it's not like you've got to go there and be, you know, enemies or duking it out. The reality is that there's enough for everybody in the space. And I think that a lot of times people get confused by that. You know, they don't want to. They don't want to like their competitors, but there's no reason not to.

Very true. And Brandon, I was on BiggerPockets podcast. Brandon was on my podcast. And sure, we compete, but there's a lot you can learn from each other. And working together is much better than trying to choke each other out.

Now, when you say you compete, I mean, he's in Denver.

Well, I just mean as far as our blogs in our space goes, BiggerPockets, what started in Denver, So we don't compete as investors. We compete. You know, we both have podcasts. We both have, you know, real estate books that are, you know, in the same genre and, and do very well. So they're definitely bigger than I am. They have a lot, you know, bigger populace. But, yeah, we're in the same space as far as that goes.

Okay, great, great. Well, Mark, we're at that point now in the podcast where we're going to put you on the spot and ask you for your tip of the week. A website, a resource, a book, something actionable where the art of passive income listeners can go right now, improve their businesses, improve their lives. What have you got?

Yeah, I think my tip of the week is kind of what we were talking about earlier with your market. You know, there's a lot of people teaching how to buy rentals, how to flip if you should buy multifamily or commercial, or if you should, you know, buy cheap houses, expensive houses. I think you have to look at your market. Real estate is so location specific. And, you know, multifamily might not work in your market. Commercial might not work there. Single family homes might not work there. But there probably is some investment that will work in your market. And just studying values and rents and opportunities will help you figure out what the best investment is there. So don't close your mind off to certain investments in your market. Really have an open mind to what may work.

I like it. I like it. Scott. Todd, what's your tip of the week.

Oh, boy.

All right, Mark. It's a book. All right.

You've heard of Gene Simmons, right?

The rocker.

The rocker Kiss.

I want a rock and roll all night.

Yeah, we got to take that mic away from you, I think.

But it's okay.

It's all right. Yeah. So he wrote a book, 2014, called Me, Inc. And it's an interesting book.

All right.

Like, he starts off like most authors. Like, the first half is his story, which. Very interesting story, what you can learn from him. The second half is kind of him telling you how, you know, how you should build your own brand, how you should build your own, you know, bring out the rock God in you as part of the title. And, you know, look, there's chapters of it that I just passed through because, you know, he talks about women. You can start your own business. There's a whole chapter dedicated to women and to children. Pass through those. Because it didn't apply to me. And that's okay. But what I thought was fascinating was. Was he does give you some real examples of the way that he thinks. I think that that's what I enjoy. Anytime I can get into the mind of how someone who's more successful than I am thinks, then it kind of helps you to see, like, man, there's. That's an interesting way of thinking. And then when you come across a pattern or something else in the future, you can see how maybe that would apply to you. So I found the book to be pretty fascinating. You guys should check it out.

Wow. Very cool. You know, it's funny because when you see the guy, you don't think much of him. Tell you, he had that reality show. Yeah. And he had some scandal.

Yeah. And he talked about. He talks about. In the book, he talks about being selfish and immature all of his life. And he kind of, you know, explains. Kind of explains his. Why. Why. Why he felt like he was that way. But the guy is extremely intelligent. Like, extremely. The stuff that he's put together, and you wouldn't even realize. Here's an example.

He.

He was basically saying that he.

He found.

He, like, uncovered or he discovered, I guess is the right word. He discovered Van Halen. And he. He had created a record, his own recording label. I think it was called Kiss Records at the time. And he signed Van Halen to a recording contract with Kiss Records. And his entire vision for Van Halen was that they would open on his tour. On the Kiss tour.

They would.

They would open in every city, and he would give them basically all of this Publicity. He would help them to build this entire fan base. And obviously, he would benefit from a revenue stream in addition to Kiss. He would benefit from this revenue stream of Van Halen.

Right.

I mean, sound logical? And there was massive income in the rock business. There you go.

So four.

He had four members of Kiss, and two of them did not approve. He basically had to go and tear up the contract for Van Halen and say, I'm sorry, we can't do this. And basically, that was like, almost towards the end of his. His partnership with his first two, or first. First bandmates, if you will. And, you know, it just kind of goes to show you, like, here's. Here is the ultimate business guy. I mean, you look at him as kind of a crazy rocker, but behind that crazy rocker is a true businessman who's really looking at passive income. And you wouldn't believe all of the trademarks that he owns. I mean, like, he owns so many trademarks, and he's always looking for.

Abilities.

To turn on passive income sources. Here's a trademark that he owns. You ever see, like, the cartoon of a money bag with dollar signs on it? Yeah, that's his.

This guy's a genius.

You wouldn't even. You wouldn't even know, man. You would not even know.

All right, I'm definitely gonna have to read this book.

Yeah, yeah, it's really good.

I remember being a kid and I didn't love the music as much as I loved the records and getting a toy with the records. Right? Yeah. You know, it's interesting because I can't think of another band. I mean, now there's maybe a few of them, but, you know, he really had an anonymity in a way, which, you know, most of these rock stars don't have, except for maybe Sia and those guys that. Yeah, yeah, yeah, yeah, yeah.

The.

I can't even think of them, you.

Know, we're talking about.

I think so.

Yeah.

What was your song? All Night?

Yeah, yeah.

Fun, whatever.

Yeah, yeah, yeah, they're big. Yeah, they're big, but you don't know what they look like.

Now, see, that's the other thing that Gene Simmons did, is that he. He literally trademarked their faces. And you can't trademark a face. Okay. Like, I can't trademark my face, but because of the paints, he could trademark the paint and he could trademark the faces. So the faces are trademarked, the logo is trademarked. This guy has trademarked everything. And in the book, he actually walks you through this whole. He literally. This is what he said. He said, look, I'm gonna come up with an idea right now. Let's call it baby 101. He's like, now what I'm gonna do is I'm gonna go and I'm gonna check to see if the trademark is available. It is available. He's like, so I'm gonna, I'm gonna trademark it. And then what I'm gonna do is I'm going to just think about, okay, well, how can I do this? Well, there's a lot of, there's a lot of moms that don't really know what they're doing with their baby. You know, you have to take a driver's test, but you don't have to take a baby test. So maybe I'm going to provide content on, hey, when your little baby is crying, screaming, maybe this is what it means. And we're going to have a TV show that teaches them how to do this. And then what I'm going to do is I'm going to find a producer because I don't know anything about babies, I don't know anything about production. So I'm going to find a, I'm going to find a producer who's going to help and they're going to basically take the concept and create it. Then what we're going to do is we're going to go to Target and we're going to get Target to license from us the baby 101 name for clothing and for baby stuff. And he's like, so then I'm going to get an income stream from that. I'm going to get the tv, the TV show is going to be the infomercial for the product line and we're going to have formula and we're going to have all this other. So I mean, this is the way this guy's mind is thinking. So after I get done with that section, I'm like, wow, wow. I go and I look up the trademark. Baby 101. Sure as heck, man, he just registered it in 2016. Gene Simmons Co. Owned Baby 101. Like, why is that not trademarked?

Unbelievable.

I trademarked the Land Geek real fast.

My tip of the week is learn more about Mark Ferguson. Check out his podcast, but go. The first place to start is invest for F O U R More M O R E dot com. I have a link to the site and, you know, learn all about, you know, real estate. And if you want to be a real estate agent, he's got information on there too. Mark Ferguson, are we good?

I think So, I mean, one day I read a really, really good book too. I'll just. It's hard to say online, but the subtle art of not giving and I love that book.

I just finished it.

Awesome.

I just finished it. And I'll tell you what was interesting to me about that book is this guy's young. Yeah, he's really young, like in his 30s young. But he's been through some stuff and I thought there was some very ancient type of wisdom coming from a 30 year old. So it was. I thought the book was great. Yeah. Scott, what do you think?

Oh, I thought it was a. I thought it was a fantastic book. I actually used it on a. As a tip of the week. And, you know, I've had some people tell me, like, oh, man, I'm surprised that you like that book because it was self help, but at the same time, I mean, I just saw like this. The way this guy thinks is incredible.

Yeah, Yeah.

I laughed the whole time.

It's really funny.

It's funny. Yeah, it was great. It was great. So, great tip. Mark Ferguson. All right, well, you know, I want to thank all the listeners. The only way we're going to get the quality of guests like a Mark Ferguson from investformore.com is if you do us three little favors. You got to subscribe, you got a rate, and you got to review the podcast. Send us a screenshot of your review to support the landgeek.com we're going to send you for free the $97 passive income launch kit. Scott, you ready?

Oh, boy.

You doing this?

Okay, let's do it.

Ready? One, two, three.

Let freedom ring.

It just never gets better. Mark Ferguson LAUGHS So that's good.

Hey, that was good.

All right, Mark. Well, best of luck. We'll, you know, thanks again. And my God, you got a lot of books. You guys gotta check out Mark Fergson's books. This is great. Fix and slip. Build a rental property empire. How to change your mindset to achieve huge success. I think Mark just wrote a book during this podcast.

I have a new one coming out next week too.

What is it?

The basics of buying and selling houses. So it's really for anybody. Doesn't have to be an investor. Just goes through everything. You need to know that your agent, lender, title company may not tell you that you're just kind of trusting them on. So you know you're getting a good deal, know how the process works and aren't getting ripped off.

Very cool. All right, thanks, Mark Ferguson.

Scott.

Todd, thank you. And we'll see everybody next time.