From property inspector with no rentals to 20 deals per month

0:00You have to see what it's like when it's good but more importantly you have to see what it's like when it's bad so when money starts to get a little bit funny and things start to go a little hairy you got to see how they claw out of it you know so we had a scenario in I think it was 2021 into 22 when rates were low so we started wh we were wholesaling everything we were taking down some flips and then finally we were like okay let's let's start holding some rentals together and then we flipped it to like let's buy a ton of rentals and so we stopped so we we instead of direct were s direct to seller getting these contracts but instead of monetizing them as a wholesale deal we' raise private money and then we' do the bur method on the back end of those deals so money got super super tight we were keeping money in deals and we weren't really tracking it that well and we knew we were making money but we just didn't know where it was at until we look we kind of reverse engineered it and we're like

0:48oh my God we have no cash we have all these assets to speak for it but this is a problem and we I I remember we sat outside our office and we're like what in the world are we going to do and we both looked at each other it's like we gotta figure it out so we both kind of just like fist bumped we're like let's let's let's go harder and we just got to claw our way out so those are the scenarios I mean that you are going to get in with a business partner some people they fight or flight and they just they run they put their heads down they they go away but not not not what we did that's awesome yeah I I can totally relate to that I've been in those situations before it's you know there's always a shortage of something you know whether it's deals or money or you know time or whatever and you got to figure out how to how to solve that problem and that's great that you guys were able to work through that of of all the different

1:37Strategies well actually first I want to I want to understand how you Source deals you mentioned postcards initially then you mentioned text messages yeah what what's the main strategy that you found to be most effective and that you're using today yeah so we're doing mostly cold calling now so texting it's it's gone up and down so for if this was two years ago I'd say our main form is texting but since the the laws and regulations have been coming out lately and I think it's kind of lightening up but I would say 95% of our deal flows coming from cold calling so we have six overseas cold callers that are basically plowing through lists and then they're dropping warm leads into our CRM we have two Acquisitions team members on our team that are just talking to sellers all day so that's our direct to seller side and then we also hired what we call our JV manager

2:25JV Department to where he's doing what I was doing before which is related ships wholesalers and reers and going out there and just being that guy for them and going out there and just trying to follow up and kind of do the same thing you would to a seller but the same thing with a wholesaler and that's pretty much a free marketing strategy so anybody that doesn't want to wholesale that's a great great method to get really really good deals yeah so what what does that bring in for for the direct to seller side of the business with six cold callers what type type of volume are they are they calling on a daily basis and then how many deals does that turn into typically yes so we're doing I forget exactly what how many calls they're making but I think they claim they do like 10,000 dials a day or

3:14Week I mean they're plowing through phone calls on like a on on a quadruple line dialer even like I think I have a 10line dialer too but they're just plowing through calls going through a script trying to get to the next person and right now we're 40 leads from from those call we know is one contract and we're about a 75% close rate on those contract so every month we're doing 13 to 15 contracts and we're closing usually about 10 of those some get killed just for sellers line because we're doing a lot of virtual stuff too it's in our Market but we're locking up stuff on the phones most of the time and that's a whole whole another conversation you want to talk about that but yeah that's that's our main strategy on on the wholesaling side okay and are all those wholesal then do you decide you know which ones you're going to

4:02Hold on to or at this point yes most of the our first option on them is wholesale because we want we we're trying to just separate all of the all of the entities and because we have a full-time dispo dispositions team member which if he doesn't sell the deals he doesn't make any money so it's it's much easier now that we have because I was that seat for years and if I want to go keep it as a rental it's like oh okay we just pay our Acquisitions guy their commission and they and nobody's hurting but now that we have that seat it's forcing us to wh s which is why we started the JV department is like okay we still want to we're flipping 15 houses at a time so we need to feed that engine as well and if we're not buying our direct to seller stuff it has to come from somewhere else now we are cherp picking some of the best deals or ones that we think we should get more on but majority of them are being wholesaled okay and

4:51the you mentioned doing this all virtually even though you're focused on the Columbus Market yeah what I guess what's the T behind that and how do you how do you do it virtually yeah so I would say our deals are done 7525 virtual to in person just because I mean time is your your best asset that you have and I mean if you're really good it's all about a sales process you know so if you're really good on the phones you ask the right questions you really should be able to get somebody a pretty good offer on the phone and it's not that we're never going to the house it's just the first touch to that seller sometimes will be our inspector so we'll lock it up over the phone and say hey Miss Miss Susie if what you're telling me to be true and all these motivations are are something that we can help with we can give you let's call it 100 Grand but if it's if the house is is different than

5:39what you're saying after our inspector comes through we're going to evaluate we're going to underwrite and we're going to maybe come back on this price if it's not what you say so I hope you're telling me the truth so then we send our inspector in they give us 150 200 pictures of the house in a one-page report we then look at it we run a deal analyzer and we say okay what do we want to dispo this out what do we think some will buy it for and where are we at on it pricewise and if they don't match up we'd then renegotiate or kill the deal or pop it out and see what we get and go from there yeah and then we'll meet people in person there's always those stubborn sellers so that's part of our sales process too hey we can get this done over the phone right now or I can come meet you and Shake Your Hand today if you want yeah do you typically ask for a price from them that they that they want to sell it for try to yeah yeah okay yeah yeah

6:28I I I remember back when I was first getting started you know I I didn't understand this concept and and so you'd spend all day you know getting a lead and then going out meeting them doing all this analysis just to call them back up and say hey here's my offer and then they're like that's not even close to what I wanted you know and so I think it's so smart to reverse engineer that and just you know work with the people that are most negotiable are in the situation you know people think well you're giving these lowball offers it's that you're finding people who you know have a problem and a situation that they cannot solve by selling the the house on the MLS you know like I can't tell you how many hoarder houses we bought and how many you know one lady called me who was locked out by the health department because her house was so nasty

7:17I mean like dead animals and stuff inside like those are the types of people they're not listing on the MLS so you know that's part of our sales process too sorry to cut you off there but sales process is we we literally tell them that so hey if you're looking for the highest and best price for your house listed on the listed on the market yeah and if they're like okay I'll go list on the market then you know you're not talking to somebody motivated but you just gave them that option if they still continue to talk to you there's something that you have you have to peel back the onion a little bit and figure out what's really going on in that situation why are they talking to somebody that they already told you they're not going to be the highest offer right exactly yeah 95% of people should sell on the MLS but that 5% that's that's the people that it can be a great win-win for so so

8:06your team then it sounds like you have quite a few team members what is that what is the breakdown of that you already mentioned the the cold callers the Acquisitions team members the JV team member the dispo guy who else do you have on the team yes so I don't really count the the cold calling people as our team members those are just kind of outsourc subcontractors I would say but we do have virtual outside of that so we have a two data managers so we're really tight with our data on our wholesale side we're not really a spray and prey type wholesale company we we use a lot of you know REI sift I'm assuming we use a lot of REI sift a lot of things like that to try and save money and we got a and we also have a lead manager on that side so three VAs on the acquisition side one on the dispo side and then we have a full-time in-house

8:55transaction coordinator so our wholesaling company has three four people on staff and then four virtually in the Philippines and then our flipping company we have two project managers I have a full-time content guy so for social media I always miss people full-time property management team member a VA on that side too and then a full-time maintenance guy and then all we also have the JV Acquisitions team member as well okay and and how did you decide when it made sense financially to hire these different individuals you know it all started to to us on the acquisition side so with the end in mind what did we want our business to look like we want autonomy we want lifestyle freedom

9:44and we also want to build a business that we don't have to be stuck in every single day and I learned a lot of this from my business partner Andy I'll talk about him a whole lot if anybody's on here and follows me on social media you may not even know I have a business partner and that's by Design he he actually went bankrupt when he was 22 so he went bankrupt when he was 22 he had a business partner in car lots that passed away signed everything over to him he was getting sued he signed a cognovit note on a bunch of cars and they came down on him and took it all so a lot of those lessons that he learned from that really trickled down into why we do what we do now so he knew that he'd been on the phones for a long time and he did it for 10 years and he's like I do not want to talk to sellers all day every day I put my time in first person we're going to H hes in Acquisitions so you got to keep the I mean any real estate

10:33business really leads and in Acquisitions are going to be the lifeblood of your business and you can't stop that so if you want to get out of it you gotta you got to train somebody you're G to take a couple steps back to take a bunch forward to go work on whatever you want to work on and then everything else just kind of came out of necessity our businesses are a lot of when we both put our heads together and we go at something hard things change really fast it works but it's like we call a leaky bucket we've got five holes in Four Hands when we start plugging one the other one starts leaking and we start to do this all the time and it's kind of a it's a good thing to have and it's also bad because we we we change Focus to certain things every now and again got it yeah yeah that makes sense and so how do you spend your time like what's your main focus now as the guy who's running these teams yeah

11:21Mo most of my time is bigger picture items so I'm I'm raising a lot of capital I'm raising actually all the capital for our deals so everything has now kind of almost stems from social media so social media has grown really really big bigger in the past two three years and everything kind of stems from there so I raise a lot of capital on there spend a lot of time it's just crazy going from being a home inspector where you wake up and you work and you make money to just the way work changes you know and I still have a hard time wrapping my head around that like if I'm going to golf with a private money lender I still feel bad about doing it because I'm not actually I feel like I'm not actually working which is it's just such a weird mindset and conceptual thing but anything that moves the business forward go to masterminds meet with people host events I host networking events in Columbus

12:11make content stuff like that got it okay and then I was going to ask you about the the the list that you're calling to that you give your cold callers what type of leads are those where you get them from yeah everything we get is from propstream and then free list so $99 propstream account and a lot of times we're getting free and clear High Equity Bank and like we're just pulling those every single month and then what we do is we also pull code violations evictions tax delinquents water shut off lists all free lists from your county and what we do is we pop those into reift which will then stack them so anything that's on those lists both of them so say somebody's on a free and clear list and also a code violation we're definitely going to Target Market them because that's a higher likeliness

13:00of motivation and can sell at a discount because you can have the most motivation in the world to sell a house but if you just bought it last year at top dollar I can't really do anything for you unless I sub to it which is not really our strategy either so I want somebody that can sell at a discount and be motivated as well yeah that makes yeah that makes a ton of sense and then of of the different strategies that you do have you identified one as being the most profitable or are they all similarly profitable wholesaling is definitely the most short-term profitable I mean just it's pretty crazy we've been hiling a lot more too so taking stuff from wholesale to retail that's been pretty great as well but I mean longterm is going to be the the the holds on the

13:48Assets and restructuring debt and pulling out tax-free money that's really the Long play on what I want to do yeah and have you found it harder to find buyers for your wholesale deals with the market kind of Shifting yeah it's been it's been really weird and cyclical you know I mean last maybe August to September or no to like December it was dead nobody was buying anything and then something happened around like February and people started to buy again and it's been a little bit slower recently which is weird so I I don't know what happens it kind of comes in waves and I I can't really put a pulse to it yeah interesting yeah yeah I've heard different things so I think yeah I think you're absolutely right it just is like little little cycles and

14:37from the rental side of things though what what type of rental properties are you guys targeting that you like to hold most of our stuff is one to Fours so if you've ever been to Columbus Ohio a lot of duplexes a lot of small multis so a decent amount a portfolio is duplexes a three unit and a lot of single families I mean it it kind of just came from I most of our Target marketing is single family people that have things they want to sell so not a lot of large multis but with with that being said I mean we we will buy small multi we've got a couple eight units a nine unit my office building I own we're buying a 32 unit office building right now so I understand that side I I actually really really like Commercial Banking financing that type of stuff I'm kind of a math nerd but not

15:25as much my my main strategy I see okay and are these primarily TurnKey properties are you doing the Burr method or what what does that look like I'm doing the bur method on everything if I can't have some sort of if I can't buy it super discounted and then put my own my own construction into it I probably not going to do the deal oh okay what what's the metrics that you use to determine that it is a good deal I mean I'm just looking at arv I'll take the arv times 75% minus my rehab and money costs and then boil it down to purchase price and then on on so that hopefully I can get all of my money out but to me that's a pipe dream if you I hate anybody that'll say online that they have their whole portfolio they've never had a dollar in I'm just like that's just that's that's ridiculous right you know so I'm not afraid to keep cash in so when

16:14I do keep cash in what's my cash on cash and I what's my return I'm actually making on my money because when I told you that we almost went bankrupt like in 2022 we had no cash we weren't looking at that you know we were so focused on just keeping assets deals were cash flowing but it's like well if you keep 60 Grand in on a deal that the arv is 300 I mean you might as well just go buy a turnkey asset at that point you know so really looking at where your money's at and don't get don't fall in love with owning rentals so much that you get yourself broke