Ep20 Fast Flipping with Abraham Sanchez and Julio Calvo

[00:00:00] [SPEAKER_05]: What we're doing right now is basically 25-30% gain on majority of the deals and we've gone up to 50% on profit margins. So that's where we want to be positioned at any time because it gives us space for error any given moment and we're creating value because your ARV could be different than mine.

[00:00:17] [SPEAKER_02]: From cornfields to high-rises, office to industrial, houses to hotels and every other asset class in real estate, we cover the people, the projects and the profit. Welcome to the Investing in Iowa Show. This show is for go-doers, action takers and business owners. It's for people like you who are sick of Uncle Sam taking a huge bite of your apple.

[00:00:40] [SPEAKER_02]: If you're looking to get ahead of what's taking place in Iowa, learn who is doing what and how you can get in on the action. You're in the right place. Hosted by Neil Timmins, an Iowa native who has been involved in over $300 million in real estate right here in Iowa. Recording in studio from West Des Moines, here's your host, Neil Timmins.

[00:01:03] [SPEAKER_04]: I've got Abe Sanchez and Julio Calvo here on the show. Guys, welcome to the show.

[00:01:08] [SPEAKER_04]: Thank you very much for having us here. It's a pleasure, Neil.

[00:01:10] [SPEAKER_05]: Say for the audience to say, who are you? Where are you from? What do you do?

[00:01:13] [SPEAKER_05]: So I'm going to start off. My name is Julio Calvo. I've been an investor. Well, I didn't start as an investor. I started as an agent with Keller Williams Realty.

[00:01:22] [SPEAKER_05]: And then I put myself in the position of flipping properties after a year or so. And ever since I've put myself into the flipping side of properties, I would say I started around 2016 when I started my first flip.

[00:01:39] [SPEAKER_04]: 2016 with your first flip. Abe, what's your backstory? And then I'm going to break it full circle here for everybody.

[00:01:45] [SPEAKER_06]: I'm also Abraham Sanchez, born and raised here in Des Moines, Iowa. I've been a real estate agent for the past seven years, six years.

[00:01:54] [SPEAKER_06]: And I started flipping properties about three years ago. And we actually made a team, me and Julio, as buyers and listing agents.

[00:02:04] [SPEAKER_06]: And then we went ahead and also made aging homes. And that's the one that basically takes care of all our flips that we do currently.

[00:02:13] [SPEAKER_04]: Yeah. So you guys flipped property together. Talk to me about that process and maybe how you both maybe independently got started flipping.

[00:02:21] [SPEAKER_04]: And then what had you come together and work together?

[00:02:25] [SPEAKER_05]: So originally I was already flipping when I met Abraham. I was with Keller Williams and then I jumped over to another brokerage called Realty One.

[00:02:33] [SPEAKER_05]: So I was working there after a couple of years. And then Abraham was becoming a new agent into real estate back in 2000.

[00:02:42] [SPEAKER_05]: I don't know what we could say. It was 1920.

[00:02:45] [SPEAKER_05]: Yeah. It's been a few years. So basically when he began there, I kind of was seeing he was becoming a new agent.

[00:02:50] [SPEAKER_05]: And I was actually just expanding my real estate business as needing buyers agents to come and work for me.

[00:02:58] [SPEAKER_05]: Right. So basically when he came on board, come and shadow me, come and see what I do.

[00:03:04] [SPEAKER_05]: You know, hey, I do listings, you know, come and see how you get a buyer, you know, how to get leads.

[00:03:09] [SPEAKER_05]: So it all started just general real estate. When he came over, that's when he started.

[00:03:13] [SPEAKER_05]: Also, I was like, well, you want to come for a long? I'm going to come. I got these flips going on too.

[00:03:18] [SPEAKER_05]: So you want to come? He's like, oh yeah, for sure. Why not?

[00:03:21] [SPEAKER_05]: So he just jumped on board and he started seeing what I was doing. At the beginning, I'm not sure if he really showed interest or not.

[00:03:28] [SPEAKER_05]: But I remember him eventually was like, man, how do you do this? How do you became about this?

[00:03:33] [SPEAKER_05]: And I said, I mean, it was hard. Originally, that's what I was telling him. I was like, it's not easy, but I'm trying, you know, I'm investing all my commissions and flipping.

[00:03:42] [SPEAKER_05]: Yeah. You make money in the real estate world, specifically the brokerage, and then you deploy that capital.

[00:03:48] [SPEAKER_05]: I would always deploy that capital to flips. Because I mean, the thing is that what drove me that way was seeing other people doing it.

[00:03:54] [SPEAKER_05]: And I was the one seeing the numbers, listening. I was the one getting them the deal. And I was the one seeing the process and then selling the property and then seeing the auto statement at the end.

[00:04:05] [SPEAKER_05]: Oh, shoot. You know what? This is cool.

[00:04:07] [SPEAKER_04]: As I like to say, you were there for conception, which is getting the deal. You were there for the birth, which is selling the deal and the profit shows up, right?

[00:04:14] [SPEAKER_04]: Correct. Yeah. And that's what ultimately it sounded like. That's how what led you into that space.

[00:04:19] [SPEAKER_05]: That's what led me. That's one of the biggest components. But before that, I was already doing flips, but just not the way it was intended.

[00:04:28] [SPEAKER_05]: Because when I started, I told this story today. We had a meeting this morning. My first flip took me about eight, nine months.

[00:04:35] [SPEAKER_04]: What were you doing?

[00:04:36] [SPEAKER_05]: Oh, man. It was horrible because when I got this first deal, I got it kind of in a not so good area. It was on Southwest 9th near university. And when I got that deal, I just hired the wrong contractors.

[00:04:50] [SPEAKER_05]: It was always the wrong contractors. I would get the contract and we would talk numbers. And at the end, the numbers were working out.

[00:04:57] [SPEAKER_05]: Well, the first contractor that I had with that flip, he just wasn't. I mean, he started off very good. And then he started seven deals. The thing is that I hired him and then he started seven deals.

[00:05:08] [SPEAKER_05]: So I was just like, OK, well, maybe that's his team. I'm not going to question the things that are getting done, you know, and then it's like, OK, he started seven deals.

[00:05:15] [SPEAKER_05]: He was one fourth of the way and he's like, hey, I'm out of the money. Yeah.

[00:05:19] [SPEAKER_05]: I'm like, what do you mean? I haven't given him all the money, but I'm like barely one fourth done.

[00:05:23] [SPEAKER_05]: I gave you about half. And then he disappeared for some time. I ended up having to hire another contractor.

[00:05:30] [SPEAKER_05]: The second contractor, I think it was for the siding and the roof. Well, he asked me for $5,000 up front to do this deal right now.

[00:05:37] [SPEAKER_05]: And then a week later, he said he was going to start the work and come to know he banished.

[00:05:42] [SPEAKER_05]: You've never seen him again?

[00:05:44] [SPEAKER_05]: Never. I knew where he was living. I know the car he was driving, but the car that he was driving wasn't his car.

[00:05:51] [SPEAKER_05]: And where he was living, he was just renting a room.

[00:05:54] [SPEAKER_05]: And he's like, well, how are you going to not, you know, trust me? I live here. I drive this.

[00:05:59] [SPEAKER_05]: You see all my equipment and you see all of my stuff. There's nothing. I'm like.

[00:06:02] [SPEAKER_05]: And then he brought a big crew the first day that he started walking. He's like, yeah, we're going to do this.

[00:06:06] [SPEAKER_05]: We're going to do that. And then come to know, boom, that was my second loss right there.

[00:06:10] [SPEAKER_05]: Same property?

[00:06:11] [SPEAKER_05]: Same property.

[00:06:12] [SPEAKER_05]: Same property.

[00:06:12] [SPEAKER_05]: That's why it took eight months.

[00:06:13] [SPEAKER_05]: So basically it starts there, right?

[00:06:15] [SPEAKER_05]: Yeah.

[00:06:15] [SPEAKER_05]: It starts there. But then again, now coming back to it, that guy vanished.

[00:06:19] [SPEAKER_05]: I went back to my first lead, which he still had money in mind.

[00:06:22] [SPEAKER_05]: We made back up again. He came and worked for me. I told him, here's more money.

[00:06:27] [SPEAKER_05]: Just help me out. Let's get this done.

[00:06:29] [SPEAKER_05]: Okay. He came back. He starts working, but then he starts lacking on work and coming.

[00:06:34] [SPEAKER_05]: You know, he's like, hey, this whole week came by. What have you done?

[00:06:37] [SPEAKER_05]: You came this day, you worked four hours and you left.

[00:06:40] [SPEAKER_05]: Well, we got a little bit of ways away, but then he's like, okay, well, we started with the kitchen.

[00:06:44] [SPEAKER_05]: We started living room first level.

[00:06:46] [SPEAKER_05]: And then he's like, well, I'm going to order you cabinets. And I mean, I don't know what I was thinking, to be honest.

[00:06:51] [SPEAKER_05]: I was so naive over the situation. I just want to do it. Because I remember I bought cabinets that somebody in Craigslist was selling.

[00:06:57] [SPEAKER_05]: And then he's like, I'll make it work. I'll fix it.

[00:07:00] [SPEAKER_05]: Yeah. Because they weren't sized in the kitchen. So now he's got to me rig it.

[00:07:04] [SPEAKER_05]: I was so naive over the situation. I said, well, if you think it's a good deal for high quality cabinets.

[00:07:10] [SPEAKER_05]: Okay, well, let's just go ahead and do it. At the end, it came out nice. I'll see if I can find some pictures. Maybe we can put it.

[00:07:16] [SPEAKER_07]: Yeah.

[00:07:16] [SPEAKER_05]: But it turned out nice at the end, but at a cost because he modified it, right? And then guess back then we used a lot of granite.

[00:07:25] [SPEAKER_05]: No, quartz. Not like we do. And I also gave him the money because he worked or he worked at that place or he knew somebody that worked at that place.

[00:07:34] [SPEAKER_05]: And he bought those countertops. Well, come to know, again, he gets lost. Oh, my God.

[00:07:40] [SPEAKER_05]: And then at that point, I swear I don't make up this. I can't make this up. I knew where he was doing these counters, right?

[00:07:47] [SPEAKER_05]: So I went to the guy and I said, hey, I just come to pick my countertops. I don't know where this guy has been. He's vanished.

[00:07:52] [SPEAKER_05]: He's like, man, I got you that counter. Those counters are not paid for. Oh, my God. I was like, they're not paid for? He's like, no.

[00:08:01] [SPEAKER_05]: No. And then we were just talking back and forth. I'm like, what can we do? He's like, well, I'll be honest with you.

[00:08:06] [SPEAKER_05]: I can't really do anything with them either. Just give me some money for you.

[00:08:11] [SPEAKER_05]: So at the end, I mean, that turned out a little bit good. But then again, I ended up paying for that twice.

[00:08:15] [SPEAKER_05]: Well, once and a half. I don't know what it was. I don't remember what was the original price, to be honest.

[00:08:20] [SPEAKER_05]: But then again, I took those. Yep. And I worked in that guy still installed him for me. He was that nice.

[00:08:25] [SPEAKER_05]: Well, then again, I was once this is done, the house is still not finished. There's still trend.

[00:08:30] [SPEAKER_05]: There's still some stuff still laying around. And then I ended up buying appliances and I ended up

[00:08:35] [SPEAKER_05]: putting in the property and, you know, the house sat there for, I don't know, a week or two.

[00:08:38] [SPEAKER_05]: And then I come check on the property and oh, no, somebody calls me and says, hey,

[00:08:43] [SPEAKER_05]: do you have somebody working at the house? I know the house has been sitting, you know,

[00:08:46] [SPEAKER_05]: not a lot of movement has been going on. I'm like, no, nobody's supposed to be there.

[00:08:49] [SPEAKER_05]: We'll come to know they were already stealing my appliances, new appliances from the house.

[00:08:55] [SPEAKER_05]: God. And I was like, you got to be kidding me.

[00:08:57] [SPEAKER_05]: You've had a lifetime experiences in one property.

[00:08:59] [SPEAKER_05]: One property. The crazy part about all this is even though I experimented horrible things

[00:09:05] [SPEAKER_05]: with my first flip, I did it out of-

[00:09:08] [SPEAKER_05]: No, that was my next question is a lot of people would go, I'm one and done.

[00:09:12] [SPEAKER_05]: And for the longest time I did. But then again, I took it as this. I did not lose on the deal.

[00:09:16] [SPEAKER_05]: I don't know. God was great with me. I didn't lose money on the deal. So I took it as like

[00:09:23] [SPEAKER_05]: a learning lesson. And when I saw all the money together, the money that I was putting for my

[00:09:27] [SPEAKER_05]: commissions and then putting it all together on this deal, I said, okay, it's a savings.

[00:09:32] [SPEAKER_05]: You know, I saved up the money. So I think I came out with like 50 or $60,000 combined. I think

[00:09:39] [SPEAKER_05]: I ended up spending like 30,000. I mean, we're talking about 2016, the materials and stuff wasn't

[00:09:44] [SPEAKER_05]: so expensive. So you were that positive on the deal?

[00:09:48] [SPEAKER_05]: Well, actually, you know what? No, no, I'm incorrect. How did that work? No, because I

[00:09:54] [SPEAKER_05]: remember that one thing I missed, I forgot. This deal that I bought, I bought it on contract.

[00:09:59] [SPEAKER_05]: So I was paying a monthly mortgage on it and I took so long that was still part of the investment.

[00:10:05] [SPEAKER_05]: So I think it's way more money. I did come out a little bit positive, but I ended up selling it

[00:10:09] [SPEAKER_05]: to a relative of mine because I need to make some money. And the relative was like, oh, I've seen what

[00:10:16] [SPEAKER_05]: you've done to this house. It's a beautiful new roof. You know, we painted the exterior. We did

[00:10:19] [SPEAKER_05]: the whole interior brand new. And I managed to just cut even.

[00:10:24] [SPEAKER_05]: It's not as easy as a 22 minute television show.

[00:10:27] [SPEAKER_05]: No, no, no. And that's another thing where I think those TV shows are rigged.

[00:10:32] [SPEAKER_05]: Well, maybe not because we've proven otherwise.

[00:10:35] [SPEAKER_04]: Yeah, we'll get to that in a minute. We're going to set it up to get through. Question for you before

[00:10:39] [SPEAKER_04]: I move back over to Abe. Why did you not just quit? Because that sounds like a terrible experience

[00:10:44] [SPEAKER_05]: that lasted eight months. Well, I still had to keep on going with real estate.

[00:10:47] [SPEAKER_05]: Yeah. Just real estate was my life right then. Because that's what got me out of the hole.

[00:10:51] [SPEAKER_05]: Just general real estate itself. So I'm like, I can't let one big hole, you know, just keep me in.

[00:10:56] [SPEAKER_05]: What'd you do before real estate?

[00:10:58] [SPEAKER_05]: What'd I do before real estate? What did I do? Oh, I used to work at a company called EFCO.

[00:11:03] [SPEAKER_05]: EFCO Economy Forms. I used to be-

[00:11:05] [SPEAKER_07]: You're a car's car.

[00:11:06] [SPEAKER_05]: Yeah, yeah, yeah. So I started as a material handler and then I went into the shipping department and then

[00:11:11] [SPEAKER_05]: into the receiving department. I worked there for about three years and then I moved.

[00:11:16] [SPEAKER_04]: What you don't know about this is that I spent a summer working there and my father was chief

[00:11:20] [SPEAKER_04]: financial officer. I was there for about 16 years. He's long. He wasn't there when you were there.

[00:11:26] [SPEAKER_04]: He's long since gone. Really?

[00:11:28] [SPEAKER_04]: Yes, I'm familiar with this. Yeah.

[00:11:30] [SPEAKER_05]: So you know how dark that place is. You know how dark that place is. That place got me depression.

[00:11:36] [SPEAKER_04]: I worked there going into my freshman year of college. So in between senior high school and

[00:11:43] [SPEAKER_04]: freshman year of college, my father got me a job there, all manual labor, all everything. And I

[00:11:47] [SPEAKER_04]: think at the end of the day, I'm certain he got me a job there so that I would buckle down and get

[00:11:54] [SPEAKER_04]: through college as quick as I could and know that if I don't take college seriously, for whatever

[00:11:59] [SPEAKER_04]: reason, this is be my existence. So therefore, I graduated college in three and a half years with two

[00:12:05] [SPEAKER_05]: majors. Wow. You knew, right? Oh, I learned quick.

[00:12:09] [SPEAKER_05]: I think that's what got me going to because I said, this cannot be my life. I cannot come to

[00:12:14] [SPEAKER_05]: this place day in, day out and still thrive in the world and say, Hey, I'm going to retire at 65.

[00:12:21] [SPEAKER_05]: That was in my life. You know, I know for a fact, I could not do that for the rest of my life

[00:12:26] [SPEAKER_05]: because just going there on a daily basis. I worked there for about three years and thank God I left

[00:12:32] [SPEAKER_05]: that place. I mean, nothing wrong with that. I made a lot. It gave me a big support in life.

[00:12:37] [SPEAKER_04]: If there's an old saying, all you get from work is a paycheck. You didn't learn.

[00:12:41] [SPEAKER_04]: Yeah.

[00:12:41] [SPEAKER_04]: You didn't get enough. And it sounded to me like you took a paycheck, but you took a life lesson

[00:12:45] [SPEAKER_04]: that is priceless.

[00:12:46] [SPEAKER_05]: Priceless forever. I still remember that place. I still remember every corner, every place.

[00:12:50] [SPEAKER_05]: You can remember the smell.

[00:12:51] [SPEAKER_05]: The smell.

[00:12:52] [SPEAKER_04]: You remember?

[00:12:53] [SPEAKER_04]: The welding smell, the ashes.

[00:12:55] [SPEAKER_04]: It's etched in memory forever.

[00:12:57] [SPEAKER_04]: Yeah.

[00:12:57] [SPEAKER_04]: I can go back to it. 27 years just in memory to go. Yeah.

[00:13:01] [SPEAKER_05]: I remember putting my hand before not even knowing a weld was so hot.

[00:13:04] [SPEAKER_05]: Yeah.

[00:13:04] [SPEAKER_05]: Burning your tips on your fingers. You know what I'm saying? No. And you can get hurt

[00:13:08] [SPEAKER_05]: quick like this.

[00:13:10] [SPEAKER_05]: Yeah.

[00:13:10] [SPEAKER_05]: Yeah. It's insane. So just moving things around, seeing all this stuff that's going around.

[00:13:15] [SPEAKER_05]: Abe, what was your first property?

[00:13:17] [SPEAKER_05]: My first property was a duplex.

[00:13:19] [SPEAKER_05]: Okay.

[00:13:19] [SPEAKER_06]: It was a duplex and similar to Julio's, it was on contract sale.

[00:13:23] [SPEAKER_06]: Yeah.

[00:13:23] [SPEAKER_06]: So obviously I just put the down payment from the money that I had saved up.

[00:13:27] [SPEAKER_06]: On that first deal, I did partner it up with my father just because at that time I didn't

[00:13:32] [SPEAKER_06]: have, you know, 60, $50,000 sitting around.

[00:13:35] [SPEAKER_06]: Yep.

[00:13:36] [SPEAKER_06]: So I started that. I didn't take as long as Julio just because I was also kind of being

[00:13:40] [SPEAKER_06]: guided by him in the aspect of, you know, what to do, what to not do. But regardless, doing

[00:13:47] [SPEAKER_06]: it myself, I want to say it probably took me around five to six months. It was a pretty

[00:13:53] [SPEAKER_06]: big duplex. It was a two in one, both units, exterior and interior driveway, all that stuff

[00:13:59] [SPEAKER_06]: was needed. So that's where it took most of the time, especially because I was also learning

[00:14:03] [SPEAKER_06]: prior to that. I mean, I would go into the storage and I would be looking at materials

[00:14:09] [SPEAKER_06]: and I'd be like, what's this, you know, what is this being used for?

[00:14:12] [SPEAKER_06]: Yeah.

[00:14:12] [SPEAKER_06]: So that kind of also, like I said, Julio kind of guided me through that. A lot of videos

[00:14:17] [SPEAKER_06]: as well. A lot of YouTube videos.

[00:14:19] [SPEAKER_05]: I remember he was doing a lot of stuff. Well, he wanted to do a lot of stuff himself.

[00:14:22] [SPEAKER_05]: I said, yeah, I wanted to do a lot of stuff myself.

[00:14:25] [SPEAKER_05]: What are you doing? I said, cause I would come and check up on him. I said, how's it going,

[00:14:28] [SPEAKER_05]: man? Yeah. And I remember that he left his house super, super nice, super nice too. And

[00:14:32] [SPEAKER_05]: I was like, stop putting in this, all this extra stuff. He's like, I know it's going to become

[00:14:37] [SPEAKER_06]: valuable, but I made that house as if I was going to live as if you were nice fixtures, you

[00:14:42] [SPEAKER_06]: know, brand new cabinets, brand new flooring stuff that it really didn't even need.

[00:14:47] [SPEAKER_06]: He was new drywall.

[00:14:49] [SPEAKER_06]: It's kind of like a high end.

[00:14:50] [SPEAKER_06]: Yeah. It was pretty high end, but it paid out. I mean, at the end of the day, that's

[00:14:53] [SPEAKER_06]: the property that started me, uh, in this flipping business. And it's something that later on,

[00:14:59] [SPEAKER_06]: we decided to go ahead and team up on the flipping side as well. You know, we were like, Hey, if

[00:15:03] [SPEAKER_06]: it takes you so amount of time to do one deal, uh, let's team up and let's do it. And

[00:15:08] [SPEAKER_06]: half the time and let's move on to the next one. And it just makes it easier because,

[00:15:12] [SPEAKER_06]: you know, managing contractors, uh, getting materials, all this other stuff, it just makes

[00:15:17] [SPEAKER_06]: it easier between two people, you know? So also on the investing side, you know, especially

[00:15:21] [SPEAKER_06]: with, uh, as Julio as well, I was investing all my commissions, all the commissions that

[00:15:26] [SPEAKER_06]: I was getting, I was investing it. Um, and at this point it really played out from something

[00:15:30] [SPEAKER_06]: that we started basically, you can say from scratch.

[00:15:32] [SPEAKER_04]: Yeah. I'm going to fast forward to get a snippet and I'm going to bring it back. Since 2021,

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[00:16:15] [SPEAKER_03]: Together, I would say about, about 125.

[00:16:18] [SPEAKER_03]: A lot of 120, 130.

[00:16:20] [SPEAKER_04]: Okay. So now let's go back. You're starting to work together. What roles, how do you work

[00:16:25] [SPEAKER_04]: together? What roles do the two of you serve so that one plus one equals more than two?

[00:16:30] [SPEAKER_05]: It was just leveraging time to be honest. Even though we were slipping, we were still ages full

[00:16:34] [SPEAKER_05]: time. We had to live off of, you know, this wasn't still maintaining at this point when we were doing

[00:16:39] [SPEAKER_05]: flips, these investments were just supporting other investments. That's all I was doing.

[00:16:44] [SPEAKER_05]: So at this- No money's coming out.

[00:16:45] [SPEAKER_05]: No money.

[00:16:46] [SPEAKER_04]: You're not pulling any money out.

[00:16:47] [SPEAKER_05]: No money, nothing. Yeah. We were still living off of what we made off commissions and still,

[00:16:51] [SPEAKER_05]: sometimes we still needed to pull from what we were pulling out of here to try to fund these other

[00:16:55] [SPEAKER_05]: deals. Because this is the thing. We went into more deals that we could potentially,

[00:16:59] [SPEAKER_05]: then this is another thing I learned, you know, don't buy more than you can chew. Don't buy more

[00:17:03] [SPEAKER_05]: than you can chew. And that's a big factor. And that's what we were doing at points, you know?

[00:17:08] [SPEAKER_05]: And we were like, Hey, you know what? I'm taking emails, responding back to emails, title, you know,

[00:17:13] [SPEAKER_05]: whatever, closing, listing appointments, buyer's appointments while I'm loading this freaking,

[00:17:19] [SPEAKER_05]: you know, all this lumber plywood, you know? And it's like, I remember I, you know, having to pull

[00:17:24] [SPEAKER_05]: my phone because it's ringing and I got to make sure I got to take this call. And I was like,

[00:17:28] [SPEAKER_05]: you know what? This is not, I can't. And that's the way we were like, you know what? Today I got

[00:17:32] [SPEAKER_05]: to work. How about you take care of the workers and this? And we were mix matching, you know,

[00:17:38] [SPEAKER_05]: the timeframe. It was like, if you're not so busy, can you go ahead and take care of this?

[00:17:41] [SPEAKER_05]: And then eventually we started buying equipment and we were like, Hey, you know what? How about you

[00:17:45] [SPEAKER_05]: go dump the trailer? You know, and I'll stick around it. Or maybe it's like, Hey, after my

[00:17:49] [SPEAKER_05]: appointments, I'll go back and I'll dump the trailer in the afternoon because it's already full again.

[00:17:53] [SPEAKER_05]: Right. So it was just mix matching because we also, we're not just like the investor. We actually

[00:17:59] [SPEAKER_05]: a project manager. Yeah. We're the design crew. We're doing everything.

[00:18:03] [SPEAKER_04]: Because the heat of this business on the flipping side, in my opinion, like yours,

[00:18:07] [SPEAKER_04]: is the contractor side of things. Yes, you have to buy right. No doubt about it. Even if you buy right,

[00:18:12] [SPEAKER_04]: you screw the contractor piece up, your profit's gone. It is all in the contractor.

[00:18:16] [SPEAKER_05]: And it's super easy to mess it up. The thing is that if just one thing can blow away your profit,

[00:18:22] [SPEAKER_05]: I mean, and this profit could take, even though you can finish a property in however fast you think

[00:18:28] [SPEAKER_05]: you can, it'll still take what? Listing the property after you sell the property, 30 day,

[00:18:33] [SPEAKER_05]: 45 day closing. But if there's no issues, that's if there's no issues, there's title issues extended.

[00:18:39] [SPEAKER_05]: Yep. So any deal, no matter how fast it is, it's been on three months. So if you can't support

[00:18:44] [SPEAKER_05]: yourself for three months, why is it even beneficiary? And then even worse if you're not

[00:18:48] [SPEAKER_05]: making any... That's three months if you've got to dial that.

[00:18:50] [SPEAKER_05]: I'm sorry. I'm talking numbers today. I'm sorry.

[00:18:53] [SPEAKER_04]: Your first story was eight months and no profit.

[00:18:56] [SPEAKER_05]: So now you see, that's the thing where I'm carried away now by what it is, but that's

[00:19:00] [SPEAKER_05]: best case scenario, working everything perfect. But you can take a year with say work three,

[00:19:05] [SPEAKER_05]: four months, four, five months and make zero profit.

[00:19:07] [SPEAKER_06]: I've met investors where they take more than a year.

[00:19:11] [SPEAKER_06]: Yeah. No, I still to this day, no investors that take houses in the market or houses that aren't even

[00:19:17] [SPEAKER_06]: halfway done and where he had 10, 15 houses.

[00:19:21] [SPEAKER_04]: I'm curious when I see those same things too. And when I see them, oftentimes it's somebody who's

[00:19:26] [SPEAKER_04]: doing work, somebody who's doing work themselves.

[00:19:29] [SPEAKER_04]: Correct.

[00:19:29] [SPEAKER_04]: And I've always said, if you're in the business, you're in the house flipping business,

[00:19:32] [SPEAKER_04]: you can't...

[00:19:33] [SPEAKER_04]: No, no way.

[00:19:34] [SPEAKER_04]: Meaning if you have decided to go grab the roller and paint the walls, you have opted for what? A $15

[00:19:41] [SPEAKER_04]: or $20 an hour job.

[00:19:43] [SPEAKER_04]: Correct.

[00:19:43] [SPEAKER_04]: And house investors, people orchestrate the deals, the people who put everything together,

[00:19:48] [SPEAKER_04]: run the projects, right? Control those people are worth way more than $20 an hour.

[00:19:52] [SPEAKER_04]: Correct.

[00:19:53] [SPEAKER_04]: Oh yeah.

[00:19:53] [SPEAKER_04]: And you've got to act like that.

[00:19:55] [SPEAKER_04]: Yeah.

[00:19:55] [SPEAKER_04]: And you've got to run an actual business, not want to function inside of the business that is

[00:20:00] [SPEAKER_04]: lowly compensated.

[00:20:01] [SPEAKER_04]: Correct.

[00:20:02] [SPEAKER_04]: Right.

[00:20:02] [SPEAKER_04]: Correct.

[00:20:03] [SPEAKER_05]: And that's the thing. We actually had a meeting today, this morning, and there was a gentleman

[00:20:07] [SPEAKER_05]: saying that, he's like, yeah, I like doing it. I'm like, yeah, you can't just be sitting in front

[00:20:11] [SPEAKER_05]: of a computer. I said, well, that sitting in front of a computer is making you probably

[00:20:14] [SPEAKER_05]: thousands of dollars more than going and doing a maintenance job. You know, that's going to,

[00:20:19] [SPEAKER_05]: like you said, they're trying to save a couple of hundred dollars.

[00:20:21] [SPEAKER_05]: You don't save it. You earned it.

[00:20:23] [SPEAKER_05]: Yeah.

[00:20:23] [SPEAKER_05]: Yeah.

[00:20:24] [SPEAKER_05]: You earned it. You earned it. I mean, you got to kind of know the background of people because

[00:20:28] [SPEAKER_05]: to a lot of extent, some people want to do that. You know what I'm saying?

[00:20:31] [SPEAKER_05]: When you come from a background, hardworking, I mean, I was working at a contract once I

[00:20:36] [SPEAKER_05]: remember working for Jetson Builders, Jetson Construction. I'm sorry. Building bridges here

[00:20:41] [SPEAKER_05]: in Des Moines.

[00:20:41] [SPEAKER_05]: That was a great paying job. I swear that was the hardest job. And I said, I don't want

[00:20:47] [SPEAKER_05]: to go and shovel dirt, you know, and get in the mud, have three quarters all the way,

[00:20:52] [SPEAKER_05]: go home and not even want to go out. Not want to anything because I'm already tired.

[00:20:56] [SPEAKER_05]: No, I'm not.

[00:20:57] [SPEAKER_05]: I know you too. You guys are too pretty for that.

[00:21:01] [SPEAKER_05]: We build ourselves there. You know what I'm saying? And that is true. And I feel well-deserved

[00:21:06] [SPEAKER_05]: about that for sure. Because I mean, from where I come from, where we're sitting right

[00:21:10] [SPEAKER_05]: now, I think it's, I don't know. I love it. I wouldn't change for anything. You know,

[00:21:14] [SPEAKER_05]: that's even great.

[00:21:16] [SPEAKER_05]: 120 projects in three years. They don't do it themselves.

[00:21:17] [SPEAKER_05]: No, it's been a hard work. But then again, we've developed a kind of a strategy to become

[00:21:24] [SPEAKER_05]: that good, you know?

[00:21:26] [SPEAKER_04]: Well, let's talk about that strategy. What's it take on the front end to buy a house? And

[00:21:29] [SPEAKER_04]: walk me through a cycle of a project and what the strategy is when you go into a particular deal.

[00:21:35] [SPEAKER_04]: And also what makes it a buy and what deals do you pass on?

[00:21:38] [SPEAKER_04]: Well, I can go ahead and answer that.

[00:21:40] [SPEAKER_05]: A lot of things there.

[00:21:41] [SPEAKER_05]: Yeah. No, it's a big, it's a big thing. So basically the main factor is seeing comps.

[00:21:46] [SPEAKER_05]: To me is number one is always comping out the property or anything. I'll comp the property

[00:21:51] [SPEAKER_05]: at the beginning before, when I'm looking at the property, I'll comp the property two or three

[00:21:56] [SPEAKER_05]: times with similar properties in the area. And then we'll go based off of the amount invested.

[00:22:03] [SPEAKER_05]: And the thing is learning or knowing your numbers, key factor, you know what I'm saying? So like say,

[00:22:09] [SPEAKER_05]: if you need siding, windows, roof, you know, those are big ticket items, HVAC.

[00:22:14] [SPEAKER_05]: Yep. So I start with those and then I work myself with the smaller ones.

[00:22:18] [SPEAKER_05]: So basically as rule of thumb, you know, I always, every single deal or any single deal,

[00:22:23] [SPEAKER_05]: or any deal, I would like to position myself to be good 50% buying, purchasing. That's kind of like

[00:22:30] [SPEAKER_05]: my center.

[00:22:31] [SPEAKER_05]: When you say 50%, what do you mean by that?

[00:22:32] [SPEAKER_05]: 50% ARV from where I have it, my ARV.

[00:22:35] [SPEAKER_04]: Your ARV, you're saying less repairs?

[00:22:38] [SPEAKER_05]: No, my ARV, my after repairs value, market value of the property. And then basically that's where we

[00:22:45] [SPEAKER_05]: usually could be, but if we can be lower than 50%.

[00:22:49] [SPEAKER_04]: So you're saying the as is price today versus the ARV, you want to be 50%.

[00:22:54] [SPEAKER_04]: What was that again?

[00:22:55] [SPEAKER_04]: The as is value. So you're going to, let's call the ARV $200,000. Where do you want to be buying it

[00:23:01] [SPEAKER_04]: today?

[00:23:01] [SPEAKER_04]: So if it's possible, I mean, less than a hundred.

[00:23:04] [SPEAKER_04]: Less than a hundred. Got it. And then above a hundred. So say you pay a hundred,

[00:23:08] [SPEAKER_04]: then you're going to go in and remodel.

[00:23:10] [SPEAKER_05]: That's if there's extent of work.

[00:23:12] [SPEAKER_04]: Yeah.

[00:23:12] [SPEAKER_05]: So basically let's say, Hey, you know what? You got to think about commissions. You got to think

[00:23:16] [SPEAKER_05]: about if you're going to sell it as a property, you got commission, you got to pay taxes,

[00:23:19] [SPEAKER_05]: you know, title, abstract, and anything that can come in within title. Right. And then on top of that,

[00:23:24] [SPEAKER_05]: I deduct, you know, the investment portion of it. And then I want to calculate at least a,

[00:23:30] [SPEAKER_05]: I'll be honest with you. What we're doing right now is basically 25, 30% gain on majority of the

[00:23:35] [SPEAKER_05]: deals. And we've gone up, up to 50% on profit margins. Right. So that's where we want to be

[00:23:43] [SPEAKER_05]: positioned at any time because it gives us space for error any given moment, you know,

[00:23:48] [SPEAKER_05]: and we're creating value because your ARV could be different than mine.

[00:23:52] [SPEAKER_05]: Correct.

[00:23:52] [SPEAKER_05]: You know what I'm saying? So you could be saying your ARV is 200. Maybe I can sell it for 250.

[00:23:57] [SPEAKER_05]: Correct.

[00:23:58] [SPEAKER_05]: With the right finishes.

[00:23:59] [SPEAKER_04]: Yeah. So how do you create value? You add square footage, you add bedrooms, you add bathrooms.

[00:24:03] [SPEAKER_05]: Finished basement, finishes, driveway, roof, windows, and overall aesthetic. Aesthetic is big,

[00:24:12] [SPEAKER_05]: you know, do those nice finishes, always have those nice appliances, bright countertops.

[00:24:16] [SPEAKER_04]: Sell the sizzle. When somebody comes in and that buyer comes in, they're going to walk that property

[00:24:19] [SPEAKER_04]: and it is not just about three bed, two bath, 1500 square feet. It's about the feeling you get

[00:24:25] [SPEAKER_05]: when you stand in that property. Correct. And you also got to know, I got a background

[00:24:29] [SPEAKER_05]: selling properties. Yes.

[00:24:30] [SPEAKER_05]: So I know what people look at. You know what people are attracted to. Kitchen and bathrooms are

[00:24:35] [SPEAKER_05]: big ticket items. That's what a lot of buyers look at.

[00:24:39] [SPEAKER_05]: Yeah.

[00:24:39] [SPEAKER_05]: Right. Yeah. So that's big, but that creates value. But not only that, sometimes like that

[00:24:44] [SPEAKER_05]: Dean property, you know, we were like, Hey, we were considering doing the garage, but it's like,

[00:24:49] [SPEAKER_05]: Hey, this property doesn't have a finished basement. At that point, I calmed the area.

[00:24:53] [SPEAKER_05]: I said, okay, let me go look at properties that don't have garages, square footage and what they

[00:24:59] [SPEAKER_05]: have. A lot of these properties in the area were selling for like one seven, right? But it didn't have

[00:25:03] [SPEAKER_05]: a garage and it didn't have a finished basement. And three, it didn't even have nice finishes. So I

[00:25:08] [SPEAKER_05]: said, you know what? Why not make everything's going to look nice. Everything's going to look

[00:25:12] [SPEAKER_05]: new. We're going to finish a basement and it's going to look beautiful. If I listed for 20 K,

[00:25:17] [SPEAKER_05]: I'm just doing a basement. I could even gone higher because now when I put it under contract,

[00:25:23] [SPEAKER_05]: it's sort of like this. Right.

[00:25:25] [SPEAKER_05]: So that means I potentially even sold it cheap. Yeah.

[00:25:28] [SPEAKER_04]: Well, you're referring to a property in which all of us know about. We were talking about this

[00:25:31] [SPEAKER_04]: pre-show. And what I hear you saying is that you just simply ran the comparables. You were at a

[00:25:34] [SPEAKER_04]: spot where going into the property at the time of purchase, you thought there was a dilapidated

[00:25:40] [SPEAKER_04]: garage. The idea was to rehab that garage. You get in there and realize it's way past dilapidated.

[00:25:45] [SPEAKER_04]: It's got to come down. Correct. So now all of a sudden you're in a position to go,

[00:25:48] [SPEAKER_04]: do I spend the money and put up a two car garage or do I pivot and finish the basement instead?

[00:25:53] [SPEAKER_04]: Then the math is the one that gives you the answer. Correct.

[00:25:57] [SPEAKER_04]: You just run comps to go, where's the demand? Where am I going to get paid? The highest

[00:26:01] [SPEAKER_04]: ROY. And you identified that. Finish basement's got to produce me a higher ROI than a two car garage.

[00:26:06] [SPEAKER_05]: Yep. Yeah. Yeah. And I knew at that point that it was just going to sell no matter what,

[00:26:11] [SPEAKER_05]: it was just going to sell. I had it in me that I'm like, it's going to sell because it's going

[00:26:14] [SPEAKER_05]: to sell. No questions asked. Any of an angle with anything, they're like, I like it. I want it.

[00:26:20] [SPEAKER_05]: And that's what I want with properties that we're doing, getting them done right. Getting them

[00:26:24] [SPEAKER_05]: done right. Getting them done on time and- Not cutting corners.

[00:26:28] [SPEAKER_05]: You know, creating value, not cutting corners. Like they say, you know, it's the difference

[00:26:32] [SPEAKER_05]: between cutting corners and doing the right thing. You know what I'm saying? And it's a big difference.

[00:26:37] [SPEAKER_04]: But- You put a fantastic product out on market. Now, how many houses does a buyer,

[00:26:42] [SPEAKER_04]: so put on your realtor hat, how many houses does a buyer see before they decide to pull a trigger on one?

[00:26:48] [SPEAKER_05]: Minimum five, 10.

[00:26:49] [SPEAKER_04]: Yeah. Not that many. A handful to maybe two handfuls, right?

[00:26:54] [SPEAKER_04]: Yeah.

[00:26:54] [SPEAKER_04]: You put a killer house on the market for sale, they're somewhere in the process of seeing five

[00:26:58] [SPEAKER_04]: to 10 and yours is in the mix. At the end of the day, all of us as house buyers, you can just make

[00:27:03] [SPEAKER_04]: the best decision you've got given the options that are available to you that you feel has the greatest

[00:27:08] [SPEAKER_04]: value to you. At that time, when you're looking to buy a house, that's the winner.

[00:27:12] [SPEAKER_05]: That is. And it's going to stand out between all of them.

[00:27:14] [SPEAKER_04]: Correct. It's about putting a product out there that's in the vein, in the pond of what's taking

[00:27:19] [SPEAKER_04]: place right now.

[00:27:20] [SPEAKER_05]: Oh, absolutely. And that's what's bringing the market. And especially in this type of market

[00:27:24] [SPEAKER_05]: that there is, I don't know why, but people love well-done houses. They love it. They want to get in

[00:27:29] [SPEAKER_05]: there and want to feel like they're living in paradise because it's their own world inside that

[00:27:33] [SPEAKER_05]: house.

[00:27:34] [SPEAKER_05]: When you're running comps, are you looking at actives?

[00:27:36] [SPEAKER_05]: I do look at a little bit of actives, but I go mostly on sold. And I try to go about a year back.

[00:27:41] [SPEAKER_05]: A lot of people try to go six months. I think a year as well.

[00:27:44] [SPEAKER_05]: To do. I go a year and I do look at pending. And so, but I really don't like focusing myself in

[00:27:52] [SPEAKER_05]: active unless it's like, oh, you know what? This property went active and pending within 48 hours

[00:27:58] [SPEAKER_04]: and there's something attractive to it. We've always used it when we flip at not as a guidance

[00:28:03] [SPEAKER_04]: of price, but as a guidance of this is what the competition, when they walk our house, they're

[00:28:08] [SPEAKER_04]: walking these other five, he's walking these other three, this is what it's going to look like.

[00:28:14] [SPEAKER_04]: Competition will look like right now and this point of time.

[00:28:18] [SPEAKER_05]: And the reason maybe we don't focus a lot on that is because we turn in a product that is just

[00:28:24] [SPEAKER_05]: beautiful. So that's the thing. It's like a lot of people try to refurbish things.

[00:28:28] [SPEAKER_05]: I don't like refurbishing because it sucks when you're looking at a nice wall or a nice end.

[00:28:34] [SPEAKER_05]: And then it's like, oh, I fixed that area, but this area looks bad. I think it'll stand out

[00:28:38] [SPEAKER_05]: by a lot and people will see that too. So why not just do it all?

[00:28:41] [SPEAKER_04]: Yeah. You'll go further in the house. And the idea is you'll push the upper end of the market range

[00:28:46] [SPEAKER_04]: on at a sale price.

[00:28:48] [SPEAKER_05]: Right. And I don't know, we just always have gambled on that and it's paid out. We've always

[00:28:52] [SPEAKER_05]: gambled on doing the best, providing the best, putting in the best. And the thing is that putting

[00:28:57] [SPEAKER_05]: in the best is bringing us 25, 15, 25% more than what we were intending to get percent wise on the sell.

[00:29:05] [SPEAKER_05]: Because you can push the market. You can push the-

[00:29:07] [SPEAKER_05]: You push it. I remember back in 2020, my God. I mean, we were buying properties that we were like,

[00:29:11] [SPEAKER_05]: oh, ARV is going to be 150. We ended up selling for 230. What did we create there? 25%. Oh my God.

[00:29:19] [SPEAKER_05]: Now look at it from the point of view as a rental. You buy this property at 60K. We put in 40, 50K,

[00:29:24] [SPEAKER_05]: we're at 110. We take it out and we get a refied at 230. Bank's asking 30%. We're sitting 150.

[00:29:31] [SPEAKER_04]: We still got a cash. Dash out refi, net positive in your pocket. You're going to recycle it and

[00:29:37] [SPEAKER_04]: you've got a property, cashline property and you recycle this dollars in the neck.

[00:29:40] [SPEAKER_05]: Yep. It's just rinse and repeat. And the thing is that we fell in love.

[00:29:44] [SPEAKER_05]: I mean, we're doing the same amount of profit as we would have flipping it or we would have made a

[00:29:49] [SPEAKER_05]: whole lot more money just flipping it. But we have, and then we're saving on taxes.

[00:29:54] [SPEAKER_04]: How many do you have now in the portfolio, on the rental license?

[00:29:57] [SPEAKER_05]: Right now, portfolio is around 43, 45. I don't recall. It's around 43, 45.

[00:30:03] [SPEAKER_04]: How do you manage the portfolio? As in who's the property manager?

[00:30:06] [SPEAKER_05]: Both.

[00:30:06] [SPEAKER_05]: Both of us?

[00:30:07] [SPEAKER_05]: Both, but-

[00:30:07] [SPEAKER_05]: You guys wear so many hats.

[00:30:09] [SPEAKER_05]: What? The thing is that he's been tackling, we have different entities. I tackle one entity

[00:30:13] [SPEAKER_05]: and he tackles another entity. But we leave them so nice that we really don't have any issues.

[00:30:19] [SPEAKER_06]: The maintenance callbacks.

[00:30:20] [SPEAKER_06]: Horror stories from other investors that, hey, this happened on this rental. We're having issues

[00:30:27] [SPEAKER_06]: with the tenant, this and that. We leave them so nice and so well done that we never really had any

[00:30:32] [SPEAKER_06]: big issue. Besides basic stuff that, hey, my AC, whatever, this and that. But in general with the

[00:30:37] [SPEAKER_06]: house, everything is so well done that-

[00:30:40] [SPEAKER_06]: Or new.

[00:30:40] [SPEAKER_06]: Or new that-

[00:30:41] [SPEAKER_06]: Had any worse.

[00:30:42] [SPEAKER_06]: Because other investors apply a bandaid when surgeries need it.

[00:30:44] [SPEAKER_05]: Correct.

[00:30:45] [SPEAKER_05]: Correct. And that's another thing. We don't discriminate rentals nor flips. We'll flip a

[00:30:51] [SPEAKER_05]: property as a rental no matter what. And that'll create that appraisal value the same or it's

[00:30:59] [SPEAKER_05]: not-

[00:30:59] [SPEAKER_04]: What do you mean by that? I'll elaborate on that so I understand.

[00:31:01] [SPEAKER_05]: So basically it's like a lot of people when they do a rental, they try and I've known investors

[00:31:05] [SPEAKER_05]: and I work with investors that just want to paint, put flooring.

[00:31:09] [SPEAKER_04]: Yeah. They want to bandaid a rental property and not put the money into it. When you're saying

[00:31:13] [SPEAKER_04]: flip, what do you mean?

[00:31:14] [SPEAKER_04]: I'm a flipping.

[00:31:15] [SPEAKER_04]: You mean you're going to invest, you're going to fully renovate it and turn it over.

[00:31:19] [SPEAKER_05]: Do it the same way as a- Because people, I like commenting on that because a lot of

[00:31:23] [SPEAKER_05]: people tend to think like that.

[00:31:24] [SPEAKER_05]: Correct.

[00:31:25] [SPEAKER_05]: If not, most of the people I could say.

[00:31:28] [SPEAKER_05]: Because a lot of people would be like, oh, I'm not going to do this to a rental. They're

[00:31:31] [SPEAKER_05]: going to destroy my house. But you don't got to see it from the point of view of destroying

[00:31:35] [SPEAKER_05]: the house. You got to see it from the point of view of appraisal. You got to see it from

[00:31:38] [SPEAKER_05]: the point of making that house rentable. And three, for the most

[00:31:43] [SPEAKER_05]: amount of money, maybe I'm not cash flowing 200 bucks. Maybe we're cash flowing 700, 800

[00:31:48] [SPEAKER_05]: bucks.

[00:31:49] [SPEAKER_04]: Yeah. You're going to push the rental values, meaning your monthly, how much you're going

[00:31:52] [SPEAKER_04]: to get out of that thing and rent. Because now you're at the upper end of the market.

[00:31:56] [SPEAKER_04]: We got three.

[00:31:57] [SPEAKER_04]: You also give somebody a property that is in much better condition. You have attracted

[00:32:02] [SPEAKER_04]: a better tenant.

[00:32:04] [SPEAKER_04]: Exactly.

[00:32:05] [SPEAKER_04]: You've got to hire something to respect.

[00:32:07] [SPEAKER_04]: Yeah.

[00:32:07] [SPEAKER_04]: Correct.

[00:32:08] [SPEAKER_04]: You want to find out how to get a property destroyed, give them a piece of crap to begin

[00:32:11] [SPEAKER_04]: with.

[00:32:11] [SPEAKER_05]: Yeah. They won't care for you already.

[00:32:13] [SPEAKER_04]: They don't care for you. You've attracted the lowest level of tenants.

[00:32:15] [SPEAKER_05]: Yeah. So the more you rent a property, you'll get better tenants. If you want to go on the

[00:32:20] [SPEAKER_05]: low, hey, rent a 900, two bedroom house. And I'm not discriminating the east side, but give

[00:32:26] [SPEAKER_05]: them something that looks bad already. They won't care for it.

[00:32:29] [SPEAKER_05]: The more they pay, the more they pay attention.

[00:32:31] [SPEAKER_05]: Correct.

[00:32:32] [SPEAKER_05]: Yeah. And then, like I said, on top of that, it's just profit, profit, profit on three things.

[00:32:37] [SPEAKER_06]: Not only that, but it also saves a lot of time and money when it comes to getting the rentals

[00:32:41] [SPEAKER_06]: certificate.

[00:32:41] [SPEAKER_06]: Sure.

[00:32:42] [SPEAKER_06]: Oh, a rentals certificate.

[00:32:43] [SPEAKER_06]: That's another thing.

[00:32:44] [SPEAKER_06]: It's so easy too.

[00:32:44] [SPEAKER_06]: It's become so easy that inspectors come in, they're more amused with the product.

[00:32:49] [SPEAKER_06]: Yeah. They're amused. They're like, we know this property, we've seen this property.

[00:32:52] [SPEAKER_06]: And for you guys to do this, I mean, it's just, it's mind blowing, you know, just how nice

[00:32:57] [SPEAKER_06]: we leave the properties. I mean, you get them in your pocket and I already know whose house

[00:33:01] [SPEAKER_04]: I'm going to go see. They already have a grill.

[00:33:02] [SPEAKER_04]: You build a reputation.

[00:33:04] [SPEAKER_04]: Correct.

[00:33:04] [SPEAKER_04]: That when they come out, they know what they're going to do.

[00:33:06] [SPEAKER_04]: Yeah.

[00:33:06] [SPEAKER_04]: All right. Three bed, two bath, 1400 square feet. Needs roof, needs siding, needs windows,

[00:33:13] [SPEAKER_04]: needs flooring, kitchen, baths redone. You get the keys today. When's it going for a sale?

[00:33:19] [SPEAKER_04]: How long does that flip take?

[00:33:20] [SPEAKER_00]: Hi, it's Ava Bauckamp, the investment relations manager for Neil's firm, Legacy Impact Investors.

[00:33:26] [SPEAKER_00]: I'm inviting you to join us for our next investor workshop, our monthly legacy briefings.

[00:33:31] [SPEAKER_00]: In these tactical Zoom calls, we cover topics and case studies for subjects such as taxes

[00:33:36] [SPEAKER_00]: and depreciation, navigating macroeconomic shifts and evaluating deals as a passive investor.

[00:33:42] [SPEAKER_00]: At each virtual workshop, we are joined by an industry guest who covers their topic in 45

[00:33:48] [SPEAKER_00]: minutes or less. No fluff, no pitches, just education and conversation with an expert each month.

[00:33:54] [SPEAKER_00]: Every workshop ends with live Q&A from Neil and our guest.

[00:33:58] [SPEAKER_00]: All briefings happen on the last Tuesday of the month at 3 p.m. Central.

[00:34:02] [SPEAKER_00]: If you can't make it live, recordings are sent out exclusively to those who've registered in advance.

[00:34:08] [SPEAKER_00]: To join us on the last Tuesday of this month, visit LegacyBriefing.com.

[00:34:13] [SPEAKER_00]: Go to LegacyBriefing.com to register.

[00:34:16] [SPEAKER_00]: If you're a first-time registrant, I'll send you a free resource at signup.

[00:34:19] [SPEAKER_00]: Head to LegacyBriefing.com and I'll see you soon.

[00:34:23] [SPEAKER_05]: On average, I would say 80, 90% of the properties will go back on the market within two weeks,

[00:34:30] [SPEAKER_05]: within 14 days.

[00:34:31] [SPEAKER_05]: Yes, 14 days.

[00:34:33] [SPEAKER_05]: It's kind of our goal on every single property.

[00:34:36] [SPEAKER_05]: I can't say every single, but that would be always our goal unless we are coming across

[00:34:41] [SPEAKER_05]: a nuisance property that we got to officially work with the city and we got to take it to

[00:34:47] [SPEAKER_05]: new city.

[00:34:47] [SPEAKER_05]: We got to get an architect.

[00:34:49] [SPEAKER_05]: We got to get an electrician.

[00:34:51] [SPEAKER_05]: We got to get a plumber.

[00:34:53] [SPEAKER_05]: We got to get an H for the guy.

[00:34:54] [SPEAKER_05]: And then we can start our work.

[00:34:56] [SPEAKER_05]: It's always a process.

[00:34:57] [SPEAKER_05]: I've done basically flips and new construction where I already know the process, but it's

[00:35:03] [SPEAKER_05]: not all about us.

[00:35:05] [SPEAKER_05]: The contractors can destroy a fast moving project because they don't care.

[00:35:10] [SPEAKER_05]: I mean, maybe they don't care.

[00:35:10] [SPEAKER_05]: Maybe they do care.

[00:35:11] [SPEAKER_05]: Maybe they're just busy.

[00:35:13] [SPEAKER_05]: Maybe they're like, oh, I don't want to go today.

[00:35:15] [SPEAKER_05]: I can't obligate them.

[00:35:16] [SPEAKER_05]: Basically at that point, going back, why two weeks?

[00:35:21] [SPEAKER_05]: I don't know.

[00:35:21] [SPEAKER_05]: We just got a system in place that makes sense.

[00:35:25] [SPEAKER_04]: How do you build that culture?

[00:35:26] [SPEAKER_04]: How have you been able to build that culture where speed is imperative?

[00:35:32] [SPEAKER_05]: Well-educated work, well-taught workers, people that know we don't really don't sub out

[00:35:38] [SPEAKER_05]: any of our projects.

[00:35:40] [SPEAKER_05]: If we ever do sub something, it's for a faster process.

[00:35:43] [SPEAKER_05]: Our workers do siding, roofing, windows, foundation, egress windows, driveways.

[00:35:50] [SPEAKER_05]: We do cement.

[00:35:50] [SPEAKER_05]: We do it all.

[00:35:51] [SPEAKER_05]: Anything that you can think of in a property, we can do except for NH.

[00:35:54] [SPEAKER_05]: We can do electrical.

[00:35:56] [SPEAKER_05]: We can do whatever.

[00:35:58] [SPEAKER_05]: So basically, we have something in place.

[00:36:00] [SPEAKER_05]: Hey, you know what?

[00:36:00] [SPEAKER_05]: We're going to start.

[00:36:01] [SPEAKER_05]: We always know where to start.

[00:36:03] [SPEAKER_05]: Anything is structural.

[00:36:05] [SPEAKER_05]: Then you get, it's like, okay, what are we going to do with these walls?

[00:36:07] [SPEAKER_05]: Are they repairable?

[00:36:08] [SPEAKER_05]: Or do we knock them down?

[00:36:10] [SPEAKER_05]: What do you think?

[00:36:10] [SPEAKER_05]: You can sometimes spend way more money trying to fix a wall than replacing it.

[00:36:14] [SPEAKER_05]: The sheet of drywall is $13, $14.

[00:36:16] [SPEAKER_05]: Why not sheet it all again?

[00:36:17] [SPEAKER_05]: Put all new drywall.

[00:36:19] [SPEAKER_05]: Tape it.

[00:36:19] [SPEAKER_05]: Texture it.

[00:36:20] [SPEAKER_05]: Takes about the same amount of time.

[00:36:21] [SPEAKER_05]: At that point, once you tape, textured, paint, put light fixtures, it almost looks like a

[00:36:25] [SPEAKER_05]: dumb product.

[00:36:26] [SPEAKER_05]: All you got to do is flooring, baseboard, and the rest is space and stuff.

[00:36:30] [SPEAKER_05]: Send the cleaning crew.

[00:36:32] [SPEAKER_05]: You know?

[00:36:33] [SPEAKER_05]: Time is money.

[00:36:34] [SPEAKER_05]: Is it not?

[00:36:36] [SPEAKER_05]: That's the biggest thing there is.

[00:36:38] [SPEAKER_05]: Time is, you can't buy time.

[00:36:39] [SPEAKER_05]: Time is money.

[00:36:40] [SPEAKER_05]: Nobody can.

[00:36:41] [SPEAKER_05]: Not the richest person can buy time.

[00:36:43] [SPEAKER_05]: And just having a product ready creates more time for more business throughout the year.

[00:36:48] [SPEAKER_05]: Because we go on a base-to-base year, right?

[00:36:50] [SPEAKER_05]: We got to pay taxes at the end of the year.

[00:36:53] [SPEAKER_05]: And what do you got?

[00:36:53] [SPEAKER_05]: You got to leverage that time.

[00:36:56] [SPEAKER_05]: You got to fit it all you can.

[00:36:57] [SPEAKER_05]: You got to maximize profit.

[00:36:58] [SPEAKER_05]: You got to maximize your work.

[00:37:00] [SPEAKER_05]: Always have a goal.

[00:37:01] [SPEAKER_05]: Our workers always have goals.

[00:37:03] [SPEAKER_05]: We incentivize a lot of stuff.

[00:37:04] [SPEAKER_05]: At the end of the year, we give them, we do the food.

[00:37:07] [SPEAKER_05]: You know?

[00:37:07] [SPEAKER_05]: We just incentivize so much stuff for the workers to be so happy in a great environment

[00:37:12] [SPEAKER_05]: that they're just producing kicking butt for us, too.

[00:37:14] [SPEAKER_05]: As much as we're kicking butt for them, they're kicking butt.

[00:37:16] [SPEAKER_05]: Because I say for them, too, is because we're also got line-up work for them.

[00:37:20] Right.

[00:37:20] [SPEAKER_05]: We don't got work for them.

[00:37:22] [SPEAKER_05]: They don't got a job.

[00:37:22] [SPEAKER_05]: Correct.

[00:37:23] [SPEAKER_05]: And it just comes by consequence.

[00:37:26] [SPEAKER_05]: Our consequence of getting a property creates work for them.

[00:37:29] [SPEAKER_05]: And that's what keeps us motivated.

[00:37:31] [SPEAKER_05]: Okay?

[00:37:31] [SPEAKER_05]: We're providing business.

[00:37:33] [SPEAKER_05]: We're growing.

[00:37:34] [SPEAKER_05]: And everybody's winning.

[00:37:35] [SPEAKER_06]: Abe, what are you most excited about this year?

[00:37:37] [SPEAKER_06]: Growing the portfolio.

[00:37:39] [SPEAKER_06]: We're actually looking at expanding to Florida.

[00:37:41] [SPEAKER_06]: So that's what I'm mostly excited for.

[00:37:44] [SPEAKER_06]: Where did Florida come from?

[00:37:46] [SPEAKER_06]: That was a curveball.

[00:37:47] [SPEAKER_06]: I didn't know that answer.

[00:37:48] [SPEAKER_06]: Iowa winters can be harsh sometimes.

[00:37:51] [SPEAKER_06]: I've been here.

[00:37:53] [SPEAKER_06]: Very hard.

[00:37:53] [SPEAKER_06]: And instead of flipping here, why not flip in Florida?

[00:37:56] [SPEAKER_05]: You know, when it's 90 degrees.

[00:37:58] [SPEAKER_05]: We've grown to the point that we don't necessarily have to be running around a lot at this point right now.

[00:38:03] Right.

[00:38:04] [SPEAKER_05]: Now we're implementing people to do our job that we were boggling our heads with.

[00:38:08] [SPEAKER_05]: And now we can say, hey, we have more time.

[00:38:10] [SPEAKER_05]: How about we start growing somewhere else?

[00:38:11] [SPEAKER_05]: Because we have this market control.

[00:38:13] [SPEAKER_05]: We have something in place.

[00:38:16] [SPEAKER_05]: All we're doing is just growing.

[00:38:17] [SPEAKER_05]: Why not grow it?

[00:38:18] [SPEAKER_05]: Because honestly, Florida is a place to vacation.

[00:38:22] [SPEAKER_05]: Yeah.

[00:38:22] [SPEAKER_05]: You know what I'm saying?

[00:38:23] [SPEAKER_05]: There's a weather.

[00:38:24] [SPEAKER_05]: There's a lot of things to like down there when it's February year.

[00:38:26] [SPEAKER_05]: Yes.

[00:38:27] [SPEAKER_05]: Why not also maybe live part of the year somewhere nice?

[00:38:31] [SPEAKER_05]: My kids love it.

[00:38:32] [SPEAKER_05]: He loves it.

[00:38:33] [SPEAKER_05]: And that's another thing.

[00:38:34] [SPEAKER_05]: We still don't know until we start doing the business, but that's growth.

[00:38:37] [SPEAKER_05]: At the beginning is growth and then comes pleasure.

[00:38:39] [SPEAKER_05]: But we stumbled upon very good deals that are very tempting.

[00:38:42] [SPEAKER_05]: So that's why we also want it.

[00:38:44] [SPEAKER_05]: There's a lot of people investing in Florida too.

[00:38:52] [SPEAKER_04]: Yes.

[00:38:55] [SPEAKER_04]: Well, with that, I'm going to take a hard pivot.

[00:38:56] [SPEAKER_04]: Why Iowa?

[00:38:57] [SPEAKER_04]: You guys are here.

[00:38:59] [SPEAKER_04]: You do a lot of things here.

[00:39:00] [SPEAKER_04]: You're still here even though Fuller is a question for the balance of this year.

[00:39:04] [SPEAKER_05]: I don't think we'll ever leave Iowa.

[00:39:06] [SPEAKER_05]: Yeah.

[00:39:07] [SPEAKER_05]: Ever.

[00:39:07] [SPEAKER_05]: Why?

[00:39:08] [SPEAKER_05]: Iowa is prime.

[00:39:09] [SPEAKER_05]: Iowa's growth.

[00:39:10] [SPEAKER_05]: Yeah.

[00:39:11] [SPEAKER_05]: Iowa is just barely starting to grow.

[00:39:13] [SPEAKER_05]: People think that it's given its whole potential.

[00:39:15] [SPEAKER_05]: No.

[00:39:15] [SPEAKER_05]: This is just barely starting to take off.

[00:39:18] [SPEAKER_05]: Iowa is going to be our base.

[00:39:20] [SPEAKER_05]: Iowa is going to be our backbone before anything.

[00:39:23] [SPEAKER_05]: Florida is just extra.

[00:39:25] [SPEAKER_05]: Iowa, we're actually venturing into commercial too.

[00:39:29] [SPEAKER_05]: That's another very exciting portion of our business too.

[00:39:32] [SPEAKER_05]: On the commercial side.

[00:39:33] [SPEAKER_05]: On the commercial side.

[00:39:33] [SPEAKER_05]: I think I've talked numbers that would take us maybe 15 flips to make that profit,

[00:39:38] [SPEAKER_05]: which we're looking on a commercial.

[00:39:39] [SPEAKER_05]: On the commercial side.

[00:39:40] [SPEAKER_05]: On the commercial side.

[00:39:41] [SPEAKER_05]: Yeah.

[00:39:41] [SPEAKER_05]: Yes.

[00:39:42] [SPEAKER_05]: We got a deal lined up right now that we're buying for dirt cheap.

[00:39:45] [SPEAKER_05]: That's probably worth $2 million once done.

[00:39:48] [SPEAKER_05]: So it's like, if we can get that done, maybe for that project, we're calculating three,

[00:39:53] [SPEAKER_05]: four months.

[00:39:53] [SPEAKER_05]: But three, four months making, creating a capital of 1.5 million.

[00:39:58] [SPEAKER_05]: Yeah.

[00:39:58] [SPEAKER_05]: Why not do more of those if it turns out good?

[00:40:01] [SPEAKER_05]: We have everything.

[00:40:02] [SPEAKER_05]: Yep.

[00:40:02] [SPEAKER_05]: Needed to do anything, to be honest.

[00:40:04] [SPEAKER_05]: I mean, not just only commercial, but anything.

[00:40:06] [SPEAKER_05]: I mean, we've even talked about building new construction, but not new construction,

[00:40:10] [SPEAKER_05]: single family, multi-family.

[00:40:11] [SPEAKER_05]: Yep.

[00:40:12] [SPEAKER_05]: Apartment buildings.

[00:40:13] [SPEAKER_04]: Hey, I'll ask this question because I ask it of a lot of clients, but we're a lot of

[00:40:16] [SPEAKER_04]: clients, meaning a lot of guests.

[00:40:17] [SPEAKER_04]: We're going to touch on it and move on quickly.

[00:40:19] [SPEAKER_04]: How do you guys finance your deals?

[00:40:21] [SPEAKER_05]: Okay.

[00:40:21] [SPEAKER_05]: So right now we've been financing a lot personally and we have had investors until you've made

[00:40:28] [SPEAKER_05]: it a little bit easier for us to do more business.

[00:40:31] [SPEAKER_04]: On our lending business.

[00:40:32] [SPEAKER_04]: On your lending business.

[00:40:32] [SPEAKER_05]: That's why I said we touch on it and move on because it's really self-serve and that's

[00:40:35] [SPEAKER_04]: not my intention.

[00:40:36] [SPEAKER_05]: No, no, no, no.

[00:40:37] [SPEAKER_05]: I want to thank you.

[00:40:38] [SPEAKER_05]: I'll be honest with you.

[00:40:39] [SPEAKER_05]: It's not extra or nothing.

[00:40:40] [SPEAKER_05]: It has really driven us to another level and you've come into play in a different way

[00:40:46] [SPEAKER_05]: because we were really doing everything ourselves.

[00:40:48] [SPEAKER_05]: We were funding everything, but it's like once you came into the picture, we're not afraid

[00:40:52] [SPEAKER_05]: to take even more business than what we're accustomed to.

[00:40:55] [SPEAKER_05]: More upstairs.

[00:40:56] [SPEAKER_05]: No, we're not letting go of, we're trying not to let go of anything that makes sense.

[00:41:01] [SPEAKER_05]: Sure.

[00:41:01] [SPEAKER_05]: Back then, if it was makes sense, we'll get it.

[00:41:03] [SPEAKER_04]: And previously, you'd have to let go of things that made sense because you just run out

[00:41:07] [SPEAKER_04]: of cash.

[00:41:08] [SPEAKER_04]: Yeah.

[00:41:08] [SPEAKER_05]: Honestly, remember the point where I mentioned don't bite more than you can chew?

[00:41:11] [SPEAKER_05]: Yep.

[00:41:12] [SPEAKER_05]: Okay.

[00:41:12] [SPEAKER_05]: That's the thing.

[00:41:13] [SPEAKER_05]: But when I said don't bite more than you can chew on our end was funding.

[00:41:17] Funding.

[00:41:18] [SPEAKER_05]: We can take care of it.

[00:41:19] [SPEAKER_05]: I can put 10 more people right now in place if I need to, to build more work or whatever.

[00:41:24] [SPEAKER_05]: So at that point, it's like, why not just grow more?

[00:41:27] [SPEAKER_05]: And that's why I think it's great.

[00:41:29] [SPEAKER_05]: You come at the right time, I think.

[00:41:32] [SPEAKER_05]: Because it was actually, we had tons of money invested in other places.

[00:41:37] [SPEAKER_05]: And now ever since you came in the picture, we've been actually stepping a little bit

[00:41:41] [SPEAKER_05]: back, taking part of the funding that we've had in other businesses.

[00:41:45] [SPEAKER_05]: And now we're leveraging it into this business, tagging you along.

[00:41:49] [SPEAKER_05]: Yeah.

[00:41:50] [SPEAKER_04]: Yeah.

[00:41:50] [SPEAKER_04]: It's fun to watch you guys do what you do so very well.

[00:41:54] [SPEAKER_04]: Thank you.

[00:41:54] [SPEAKER_04]: As quickly as you guys.

[00:41:55] [SPEAKER_04]: Thank you.

[00:41:56] [SPEAKER_04]: Are you guys ready for the final three questions?

[00:41:58] [SPEAKER_04]: Ready.

[00:41:58] [SPEAKER_04]: If you had one piece of advice to your 20 year old self, what would it be?

[00:42:02] [SPEAKER_05]: Ah, that's a good one.

[00:42:04] [SPEAKER_05]: Honestly, learn faster.

[00:42:06] [SPEAKER_05]: That's hard.

[00:42:08] [SPEAKER_05]: But I don't know.

[00:42:09] [SPEAKER_05]: I wish I could teach all my wrongdoings.

[00:42:12] [SPEAKER_05]: And I think I'd be, I don't know, crazy millionaire if I would have known.

[00:42:15] [SPEAKER_05]: Because I let go of so much stuff ever since I was 20.

[00:42:19] [SPEAKER_05]: And if I would have made the right choices, the right moves at the right time and know

[00:42:23] [SPEAKER_05]: what I know now, I don't know.

[00:42:25] [SPEAKER_05]: Maybe I would be somewhere way even higher than where we are right now.

[00:42:29] [SPEAKER_06]: It would say you?

[00:42:30] [SPEAKER_06]: For me, to be honest, it would just be get a little bit more savvy with counting with numbers

[00:42:39] [SPEAKER_06]: in regards to school wise.

[00:42:40] [SPEAKER_06]: You know, during high school, I wasn't the best student.

[00:42:44] [SPEAKER_06]: You know, in regards to, it's kind of hard for me to learn a few things just because

[00:42:49] [SPEAKER_06]: I would get bored.

[00:42:50] [SPEAKER_06]: But I think for me, something that going back, it would be just getting a little bit more

[00:42:54] [SPEAKER_06]: savvy in regards to like paying a bit more attention like with accounting or other subject

[00:42:59] [SPEAKER_06]: in school.

[00:43:00] [SPEAKER_06]: I think it would just be something that would be more beneficial.

[00:43:04] [SPEAKER_06]: Not really beneficial, but it's just something that I would change, you know, because maybe

[00:43:07] [SPEAKER_06]: some of the stuff that took me a bit to learn, I could have already had it learned, you

[00:43:12] [SPEAKER_06]: know, and it would have just been much smoother because right now, I mean, with numbers, I'm

[00:43:16] [SPEAKER_06]: pretty good right now with numbers.

[00:43:18] [SPEAKER_06]: It came out of the list.

[00:43:19] [SPEAKER_06]: It came out of the list.

[00:43:20] [SPEAKER_06]: At the beginning, it was something that cost me money.

[00:43:22] [SPEAKER_06]: You know, so I think that's something that going back down the road, I would have done

[00:43:27] [SPEAKER_06]: that different.

[00:43:28] [SPEAKER_06]: Sure.

[00:43:28] [SPEAKER_06]: But it's something that whoever's watching this can learn from that eventually pay a

[00:43:33] [SPEAKER_06]: bit more attention in those things.

[00:43:35] [SPEAKER_06]: Two books that changed your life.

[00:43:36] [SPEAKER_06]: Two books.

[00:43:37] [SPEAKER_06]: We were just talking about that.

[00:43:38] [SPEAKER_06]: Yeah, we were just talking about that with Tony, actually.

[00:43:41] [SPEAKER_06]: Yeah.

[00:43:41] [SPEAKER_06]: Yeah.

[00:43:41] [SPEAKER_06]: I won't be honest with you.

[00:43:42] [SPEAKER_06]: Like I just mentioned, and that's something that I'm actually working on.

[00:43:45] [SPEAKER_06]: As of today, we were just speaking out with Tony.

[00:43:48] [SPEAKER_06]: Mine was rich that poor day.

[00:43:49] [SPEAKER_05]: It really brought a lot of knowledge, knowing having somebody that really gone to college

[00:43:56] [SPEAKER_05]: and I never had nobody go to college.

[00:43:59] [SPEAKER_05]: I learned from the streets.

[00:44:01] [SPEAKER_05]: That's a big knowledge right there.

[00:44:03] [SPEAKER_05]: You can build wealth no matter who you are.

[00:44:05] [SPEAKER_06]: As I was mentioning with myself, I wasn't the best at school.

[00:44:08] [SPEAKER_06]: So books for me to this day are somewhat boring in regards to reading it.

[00:44:13] [SPEAKER_06]: You know, but there's, I'm working on going into Audible and listening to them, you know,

[00:44:18] [SPEAKER_06]: so I can extract that knowledge.

[00:44:20] [SPEAKER_06]: Because like I said, I've had to learn kind of the hard way.

[00:44:22] [SPEAKER_06]: And by learning the hard way, it kind of, you know, it comes at a cost sometimes.

[00:44:27] [SPEAKER_06]: So it's something that in real estate, there's so much to learn.

[00:44:31] [SPEAKER_06]: So much to learn every day, no matter who you are, how experienced you are.

[00:44:35] [SPEAKER_06]: Every day is a learning process, especially with real estate.

[00:44:37] [SPEAKER_06]: So it's something that I personally want to start working on and getting as much knowledge

[00:44:42] [SPEAKER_06]: as I can in different aspects.

[00:44:44] [SPEAKER_06]: You know, we've mastered the aspect in regards to flipping and rental, but there's so many

[00:44:50] [SPEAKER_06]: other aspects where we can go ahead and just, you know, kill it as well.

[00:44:55] [SPEAKER_04]: If you were cast away on an Island for a year, you could only get three pieces of data about

[00:45:01] [SPEAKER_04]: your business every month.

[00:45:03] [SPEAKER_04]: What three things must you know every month to know how your business is running?

[00:45:07] [SPEAKER_05]: Cash flow.

[00:45:08] [SPEAKER_05]: Funding the money in the accounts, accounting.

[00:45:11] [SPEAKER_06]: And I think the deals that are just coming in because if you have those things on check,

[00:45:16] [SPEAKER_06]: I mean, it's endless money.

[00:45:18] [SPEAKER_05]: And what were the three questions again?

[00:45:20] [SPEAKER_05]: I mean, what three things?

[00:45:22] [SPEAKER_05]: Three things.

[00:45:22] [SPEAKER_05]: Yeah.

[00:45:23] [SPEAKER_05]: What are the three things?

[00:45:23] [SPEAKER_04]: From the business.

[00:45:24] [SPEAKER_04]: Yeah.

[00:45:24] [SPEAKER_04]: From your business that you need to know to know how your business is running.

[00:45:27] [SPEAKER_04]: So yeah, the cash flow.

[00:45:28] [SPEAKER_04]: The cash flow.

[00:45:29] [SPEAKER_04]: Your cash flow.

[00:45:30] [SPEAKER_04]: And then what I hear you say is what's your cash balance and your-

[00:45:33] [SPEAKER_04]: Cash balance.

[00:45:34] [SPEAKER_04]: Yeah.

[00:45:35] [SPEAKER_04]: And payroll.

[00:45:36] [SPEAKER_04]: Payroll.

[00:45:37] [SPEAKER_04]: Yeah.

[00:45:37] [SPEAKER_04]: I like that you said cash flow.

[00:45:40] [SPEAKER_04]: What I think a lot of people miss out on in real estate just by looking at the net operating

[00:45:46] [SPEAKER_04]: income of your rentals is that net operating income is not cash flow because you've got

[00:45:51] [SPEAKER_04]: debt pay down in there.

[00:45:52] [SPEAKER_04]: That shows up as profit, but it's not cash.

[00:45:56] [SPEAKER_04]: Yep.

[00:45:56] [SPEAKER_04]: You can't eat that.

[00:45:57] [SPEAKER_04]: It doesn't fund your business.

[00:45:58] [SPEAKER_04]: It doesn't fund your payroll.

[00:46:00] [SPEAKER_04]: So I echo what you said because that's...

[00:46:03] [SPEAKER_04]: I've never said it on the show, but that's one of my three is exactly just that.

[00:46:07] [SPEAKER_04]: All right, guys.

[00:46:07] [SPEAKER_04]: I've asked lots of questions.

[00:46:08] [SPEAKER_04]: We could talk all day, I'm certain.

[00:46:09] [SPEAKER_04]: But what's one question I did not ask that I should have asked?

[00:46:13] [SPEAKER_04]: What did you not?

[00:46:15] [SPEAKER_04]: None.

[00:46:15] [SPEAKER_04]: What can you might touch in regards to real estate?

[00:46:18] [SPEAKER_04]: Anything.

[00:46:19] [SPEAKER_04]: Or anything?

[00:46:19] [SPEAKER_04]: Real estate, personal, anything at all.

[00:46:22] [SPEAKER_04]: There's no wrong answer here.

[00:46:23] [SPEAKER_04]: We talked about the real estate.

[00:46:25] [SPEAKER_04]: We talked about rentals.

[00:46:26] [SPEAKER_04]: We talked about how we started.

[00:46:28] [SPEAKER_04]: We started.

[00:46:29] [SPEAKER_04]: There's no possible way who Leo is speechless.

[00:46:31] [SPEAKER_06]: I am.

[00:46:33] [SPEAKER_06]: He talked about what our goal is.

[00:46:35] [SPEAKER_06]: We talked about our goal.

[00:46:36] [SPEAKER_04]: Well, we talked around goals.

[00:46:38] [SPEAKER_04]: So maybe we'll touch on goals.

[00:46:39] [SPEAKER_04]: We talked about you being excited for this year and what about.

[00:46:43] [SPEAKER_04]: But talk to me about specific goals.

[00:46:45] [SPEAKER_04]: What do you want to accomplish?

[00:46:46] [SPEAKER_04]: You've got 45-ish in the rental portfolio.

[00:46:49] [SPEAKER_04]: What is actually the goal in the rental portfolio?

[00:46:52] [SPEAKER_04]: Or is it to grow that?

[00:46:54] [SPEAKER_04]: Or is it to convert some of that to commercial?

[00:46:55] [SPEAKER_04]: What's the goal there on the holding side of this?

[00:46:57] [SPEAKER_05]: Well, to be honest, what we're thinking is we didn't have a specific number of growth.

[00:47:02] [SPEAKER_05]: So, I mean, honestly, I foresee that growing to 1,000 properties.

[00:47:06] [SPEAKER_05]: For reals.

[00:47:07] [SPEAKER_05]: I mean, I can easily see it.

[00:47:09] [SPEAKER_05]: You know, maybe if it doesn't become 1,000, I think I'd be more than happy with 500.

[00:47:14] [SPEAKER_05]: Yeah.

[00:47:14] [SPEAKER_05]: And 500 would give us plenty to live off.

[00:47:17] [SPEAKER_06]: One of the other biggest goals would be going into that new development era where, you know,

[00:47:24] [SPEAKER_06]: multifamily.

[00:47:25] [SPEAKER_06]: That does excite me.

[00:47:26] [SPEAKER_06]: That's something that is, you know, that commercial space.

[00:47:28] [SPEAKER_06]: The commercial space.

[00:47:29] [SPEAKER_06]: I mean, it's just something that excites us because it's something completely different

[00:47:33] [SPEAKER_06]: from what we're doing right now.

[00:47:34] [SPEAKER_06]: But the reward is much, much bigger.

[00:47:37] [SPEAKER_06]: So, that's something that eventually we want to go ahead and focus on that.

[00:47:42] [SPEAKER_06]: Because like Julio said, you know, we can have one deal give us the same as 10, 15 flips.

[00:47:48] [SPEAKER_06]: Right.

[00:47:48] [SPEAKER_06]: You know, so why not focus on that one deal and maybe do three, four, five of those at a time?

[00:47:55] [SPEAKER_06]: You know.

[00:47:56] [SPEAKER_06]: So, it's something that we're looking forward to it.

[00:47:58] [SPEAKER_06]: And that's one, I think, one of our biggest goals that we have.

[00:48:00] [SPEAKER_05]: And hopefully houses to hotels, right?

[00:48:02] [SPEAKER_05]: Yeah.

[00:48:02] [SPEAKER_05]: No, absolutely.

[00:48:03] [SPEAKER_05]: I mean, the biggest thing I know so many people that don't even have it, I think have 50 rentals.

[00:48:08] [SPEAKER_05]: They're living very well.

[00:48:10] [SPEAKER_05]: Super well.

[00:48:10] [SPEAKER_05]: Sure.

[00:48:10] [SPEAKER_05]: They're not worried about anything.

[00:48:12] [SPEAKER_05]: I see them.

[00:48:13] [SPEAKER_05]: And it's like, my goal, our goal of even coming to 500 properties is, it seems so easy now.

[00:48:19] [SPEAKER_05]: But this commercial, you know, an old tight family ordeal, you know, could fetch a whole lot more.

[00:48:26] [SPEAKER_05]: Sure.

[00:48:26] [SPEAKER_05]: Make it more fun.

[00:48:27] [SPEAKER_05]: I think it'll be more interesting.

[00:48:29] [SPEAKER_05]: Get to 500 or a lot faster.

[00:48:31] [SPEAKER_05]: Yeah.

[00:48:31] [SPEAKER_05]: Oh, yeah.

[00:48:31] [SPEAKER_05]: Oh, yeah.

[00:48:32] [SPEAKER_05]: Easily.

[00:48:32] [SPEAKER_05]: Yeah.

[00:48:33] [SPEAKER_05]: I mean, I've known, I've seen, I follow a lot of people that, you know, do commercial

[00:48:37] [SPEAKER_05]: with the state.

[00:48:37] [SPEAKER_05]: They, they're talking about 50, 60, 70 million and they're talking like it's chips.

[00:48:43] [SPEAKER_05]: I don't know.

[00:48:43] [SPEAKER_05]: You know?

[00:48:43] [SPEAKER_05]: And it's like, I need a 1031 exchange because I don't want to be paying taxes on all this

[00:48:47] [SPEAKER_05]: money.

[00:48:47] [SPEAKER_05]: They parked their money somewhere and they just parked their money wherever so they don't

[00:48:51] [SPEAKER_05]: have to pay for it.

[00:48:52] [SPEAKER_05]: Then they get it out in the next few years or whatever.

[00:48:54] [SPEAKER_05]: It's like, and they're generating, I don't know, like $50,000, $70,000 one building,

[00:49:00] [SPEAKER_05]: you know?

[00:49:01] [SPEAKER_05]: Yep.

[00:49:01] [SPEAKER_05]: If not more, some of them are per month.

[00:49:05] [SPEAKER_04]: Yeah.

[00:49:05] [SPEAKER_04]: It's incredible what can take place in here and the sky is the limit, right?

[00:49:09] [SPEAKER_04]: Right.

[00:49:10] [SPEAKER_04]: Hey, see, for people who they want to find you, they want to follow you, they want to

[00:49:12] [SPEAKER_04]: connect with you, where can they go?

[00:49:14] [SPEAKER_04]: What should they do?

[00:49:14] [SPEAKER_05]: Main one for me is the Calvo Real Estate Group.

[00:49:17] [SPEAKER_05]: A lot of people reach out to me through there.

[00:49:19] [SPEAKER_05]: I am in the plans of building some new websites.

[00:49:22] [SPEAKER_05]: We're planning on starting our TikToks.

[00:49:24] [SPEAKER_05]: Yeah.

[00:49:24] [SPEAKER_05]: A lot of people have been asking for those, everybody that we talk to, people that know

[00:49:28] [SPEAKER_05]: us are really pushing the envelope for us to do TikToks.

[00:49:33] [SPEAKER_05]: They want to see that time lapse of beginning to end.

[00:49:35] [SPEAKER_05]: Sure.

[00:49:36] [SPEAKER_06]: And how fast do, you know?

[00:49:37] [SPEAKER_06]: So we want to show them on a daily basis, you know, how our lives run around this business

[00:49:43] [SPEAKER_06]: and something that won't only benefit us, but it'll benefit the rest of the audience

[00:49:48] [SPEAKER_06]: as well.

[00:49:49] [SPEAKER_06]: No doubt.

[00:49:49] [SPEAKER_06]: Abe, how do people find you?

[00:49:51] [SPEAKER_06]: They can find me either, same on Facebook, Abraham Sanchez.

[00:49:54] [SPEAKER_06]: I have my business account on there.

[00:49:56] [SPEAKER_06]: So just Abraham Sanchez.

[00:49:57] [SPEAKER_06]: That's the easiest form of contact.

[00:50:00] [SPEAKER_04]: Perfect.

[00:50:00] [SPEAKER_04]: Links below in the show notes, everybody.

[00:50:02] [SPEAKER_04]: Guys, thanks for being here.

[00:50:03] [SPEAKER_04]: Thank you very much for having us, Neil.

[00:50:05] [SPEAKER_04]: Thank you, Neil.

[00:50:05] [SPEAKER_04]: It was a pleasure.

[00:50:06] [SPEAKER_04]: Thanks for listening.

[00:50:07] [SPEAKER_04]: If you're enjoying the show, may I ask a favor of you?

[00:50:10] [SPEAKER_04]: Naturally, subscribe so you never miss an episode.

[00:50:12] [SPEAKER_04]: But would you rate and leave an honest written review on Apple Podcasts?

[00:50:17] [SPEAKER_04]: It does a lot for us here at the show, and I appreciate reading your thoughts.

[00:50:21] [SPEAKER_04]: Great guests make for a great show.

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[00:50:31] [SPEAKER_04]: Visit Investing in Iowa to fill out an application or recommend a guest.

[00:50:36] [SPEAKER_04]: And if you want to connect with me one-on-one, go LegacyImpactInvestors.com.

[00:50:42] [SPEAKER_04]: Click on the Invest With Us button in the top right corner.

[00:50:45] [SPEAKER_04]: And there, you can pick a time for the two of us to get on the calendar and connect.

[00:50:49] [SPEAKER_04]: Until next time, keep investing in Iowa.