Ep33 Creative Investing with Ethan Montang

[00:00:00] It has been extremely difficult to get conventional lending along the way.

[00:00:04] You can only go so far with that service coverage ratio lending as well, but it all has this

[00:00:08] cap. So I realized I needed a way to still continue to grow my business and expand where I was at.

[00:00:15] From cornfields to high-riseness, office to industrial houses, do hotels and every other asset

[00:00:21] class in real estate, we cover the people, the projects and the profit.

[00:00:25] Welcome to the Investing in Iowa Show. This show is for go-doers, action takers and business owners.

[00:00:32] It's for people like you who are sick of Uncle Sam taking a huge bite in your apple.

[00:00:37] But you're looking to get ahead of what's taking place in Iowa. Learn who is doing what

[00:00:42] and how you can get in on the action. You're in the right place. Posted by Neil Timmins and Iowa

[00:00:48] has been involved in over $300 million in real estate right here in Iowa, recording

[00:00:55] in studio from West of Iowa. Here's your host, Neil Timmins. Ethan Montang, welcome to the show.

[00:01:02] Thank you so much for having me, Neil. I appreciate it. How many of you are here?

[00:01:04] Say put the audience to say who are you away from? What are you doing? 32 years old, I'm a

[00:01:09] single dad. I've been investing about my first rental in 2016. Started with single family and

[00:01:16] up in and now I pretty much solely focus on multi-family commercial. And I bought my first business

[00:01:22] recently. I bought your first business. We got a lot on Packer. Take me to the beginning. Tell

[00:01:27] you about the very first rental. First rental was in Ames, Iowa. It was a househacker,

[00:01:32] typical traditional way. Didn't buy it right but ultimately I lowered my expenses because

[00:01:38] there was a three bedroom one bath house. I ran it up to the bedrooms to my buddies.

[00:01:42] I lived in one room and therefore was a pain rack anymore. I didn't buy it at the right price

[00:01:48] two or three years later when we finally sold, I sold it for like a thousand dollars more than what

[00:01:51] I bought it for. But I got out of renting for that year those years. What led you into that

[00:01:57] particular purchase? Was it new going to school and househacking or was it an actual true,

[00:02:02] you know, to be in Tent being an I'm an investor when we buy this. Yeah so I used to rest on college

[00:02:07] and I got hurt in my scholarship dropped out when Tera opened travel and when I came back

[00:02:12] my dad was like what are you going to do with your life? And I was like I was a great question.

[00:02:19] So I was thinking about it one night and I was in my car and I heard a fortune builders

[00:02:24] had come on. They had come to this free real estate course and it was just like there's something in

[00:02:29] my head. I'm a Christian or I don't know what your faith through but something spoke to me and

[00:02:33] like you know as long as nothing bad ever happens the population will never decrease and therefore

[00:02:38] people always need places to live. So that was kind of like okay I'm just going to call this number

[00:02:42] go to this free course and just see what happens well at that course I learned about Rich Dad

[00:02:47] Poor Dad and read that and that was you know 11 years ago. Okay, so you go past the first rental

[00:02:53] and start flipping from property. Yeah I was very slow. I was very slow. I'm keeping it at the same

[00:02:57] way. Yeah, exactly. Very slow in the beginning. I only did a deal every year from my first three

[00:03:02] years. Well single family, dueplex, first flip, all the names sold those four units and bought

[00:03:09] 15 units in Bound and that's kind of where it ramped up from there. I think that was about 2018.

[00:03:14] Hey Iowa investors. This is Avabau Camp. Chief of staff at Legacy Impact Investors

[00:03:19] have you thought about adding real estate to your portfolio but don't have the time or desire

[00:03:24] to play landlord at Legacy Impact Investors we do the heavy lifting. Our team finds the deals,

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[00:03:40] to a maintenance call. They just share an income appreciation and tax benefits. These opportunities

[00:03:46] aren't for everyone. They're for qualified accredited investors only. If you want to learn more

[00:03:51] please visit Legacy Impact Investors.com to apply. What did you learn flipping houses? That I wasn't as

[00:03:58] skilled as I wasn't as easy as they make it seem on YouTube and Instagram. You're telling me

[00:04:05] that easy is that the HDD-2222 minute jump program. It's a great hit right? Yeah, what are they doing?

[00:04:11] I do it in 45 minutes. It's out of here taking me over a year. I'm doing some wrong.

[00:04:17] We're doing everything. I'm going to see how you run a project. I got lucky enough to stumble into

[00:04:21] my still-to-the-day business partner Shannon and he is just a phenomenal artist. He is so skilled

[00:04:27] and talented. Water Boy work in all the demo and stuff that looked cool on Instagram because I

[00:04:32] made content myself but then in the real finish work I left to him and we met in 2017 and have been

[00:04:40] together ever since. See you bought some multi-family him, bro. How'd you manage it? Managed it myself.

[00:04:45] It was difficult in the beginning but you know, quick books. Some of those these apps they help

[00:04:50] but there's not unless you're paying for someone to teach you how to learn them or YouTube,

[00:04:55] it was very difficult so I made a significant amount of mistakes as a property manager.

[00:05:01] However I read this book, LandLewing on Auto Pilot by Mike Butler. Yep, completely changed.

[00:05:06] How I was managing my properties and I made the, you know, continuing forward a lot simpler.

[00:05:12] Give me a two or three thing. Wait, wait, wait. So I looked, you know, I'm 32. My company's young

[00:05:17] pro. I started studying real estate at 21. And you're looking young today and I look young today.

[00:05:23] Thank you for that. So I very quickly realized in this real estate game I was significantly younger

[00:05:30] than a lot of the people I was interacting with and I didn't want to be judged or especially

[00:05:34] by the tenants too. Younger investor or establishment investors can look back on themselves and remember,

[00:05:39] oh, I was young too. I know what that hunger is. He's one of those kids. Well,

[00:05:43] attendant they don't have that same mindset and they think you're just born into money or some

[00:05:48] rich kid or just whatever scenario a story they make up in my head. And I knew to eliminate

[00:05:54] that was just to not identify myself as the owners. So that's one thing I stop doing a long time ago.

[00:06:00] Yeah. I learned that same thing from the book. You're always a property manager right?

[00:06:03] Yeah, everything on. Yeah, never the only thing. What software system were you utilizing the

[00:06:07] Open Manager at that time? Quick books. Was the only one we have moved now to Appfolio and they think it's a bit

[00:06:14] better, but I didn't even have a way to track like conversations with tenant. It was all through email

[00:06:20] and then moved to texting and I was like, oh, God, should not have given my tenant my number to 15 tenants.

[00:06:26] A lot of those things now are huge factors in the where I'm at when a situational arrives. I can

[00:06:33] remember, oh, this is the reason why I don't do it this way. I operate and navigate different now

[00:06:37] because of all the mistakes. I made it in the beginning. It's something for them. Yeah,

[00:06:42] they're tremendous learning lesson. Yeah. What about you? Give me one of your learning lessons or

[00:06:46] your favorites from the landlord in the public. It's been years since that occurred. The biggest

[00:06:51] one is that never give me your name. That would also, you know, to take a one step further,

[00:06:55] never buy a property in your name. There's lots of research to do that. But of course put it in

[00:07:03] a recall years ago, having buying one of my first properties. He had put it into my personal

[00:07:09] name at the time because he got better alone. Terms, terms. Yeah. And so a neighbor hated that

[00:07:15] a fact over for rent. So I literally get a harassment calls from a neighbor. That's ridiculous.

[00:07:20] Yeah. And so then it was like, all right, we're going to fix that quickly and deal it over. Yeah.

[00:07:24] Getting a company in nobody knows. Yeah, privacy goes on. It really does. You know,

[00:07:30] one of the things I liked in the book a lot, which is this is a great segue for what you do

[00:07:35] today. He has providing your tenant multiple options at the time of renewal. So at the time of renewal,

[00:07:42] it's, you know, if this applies. Yeah. If this applies. You've been a fantastic tenant. We want

[00:07:47] to offer you the option now at 8 to extend. And I mean, these are different options. Yeah. One year,

[00:07:52] two year, three year. Yeah. And they have three different prices. Yeah. Share with them. Here's

[00:07:56] not the rest of the beautiful thing. One of the things that you do, I think is super interesting

[00:07:59] is when you're buying properties today, you like bringing multiple options to the table. Correct.

[00:08:04] Yeah. Talk a little about that. Then let's, I want to go into something. Yeah.

[00:08:09] Specific that you've done, we're going to actually put some context totally. Well,

[00:08:12] I quit my job in 2019 to do real estate full-time. It has been extremely difficult to get

[00:08:20] conventional lending along the way. So they love the bank. Let's see. They have a couple years of

[00:08:25] years of experience. And then past that, if you're in this business, they want to see tax returns

[00:08:29] and everything. I want to say track or do how dollars are. I'm an dollars. Yeah. And you can only

[00:08:33] go so far with that service coverage ratio lending as well. It all has this cap. So I realized

[00:08:39] I needed a way to still continue to grow my business and expand where I was at. And so what I

[00:08:45] realized was I didn't have the luxury to buy with conventional lending, but I need to figure out

[00:08:50] if a seller would still be willing to. What I didn't want to come in was just instantly be the

[00:08:55] guy that's only buying on contract even though that's what I do focus on. And that is my goal.

[00:09:01] Because I am capable of buying other ways. Just how do I have to structure it? Who do I

[00:09:05] have to bring in as a partner? All these different scenarios. So what I realized was why don't I just

[00:09:11] every single time I encounter a deal, whether there's an agent involved or not right now. I may

[00:09:16] have to communicate more with the agent on why I'm presenting it this way. But if they're not

[00:09:21] involved and it's just me and the seller, I'll give them an all cash offer which will be the least

[00:09:26] price offer. I'll give them a bank finance offer which will normally have the worst terms like

[00:09:32] 75 day closing or you know as I put terms in there to deter them specifically from that one.

[00:09:38] But that is the middle price offer. And then the highest price offer is always my seller financing

[00:09:43] offer which is as close to what they want as possible to what I need on the backside.

[00:09:48] Yeah and what you need on the backside. Let's talk through, give me an example of a

[00:09:51] traditional seller price deal. It's 100,000 bucks as the seller wants. So let's talk through

[00:09:56] what some of those terms might look like. What you have, I think five negotiating things.

[00:10:02] So we already went over purchase price. You have down payment. You have balloon. The amount of

[00:10:07] time before you have to pay them there lump some interest rate and amitirization schedule.

[00:10:13] You can also even get more creative and start tacking on what do we want to your payment type?

[00:10:18] Is that loan or is that interest and principles? Is it interest only? Do you need four months

[00:10:23] before you need to make your first payment and is a cruel of interest going to happen in that

[00:10:27] time? I mean, you can really get so creative. You forgot my hair one which is principal only.

[00:10:32] Oh yeah. No inches. No inches. Just principal payments. I've

[00:10:37] done one of those before. I've done one as well. I did one. I'm 11 year fully advertised loan

[00:10:42] principal only. Principal only. Wow. Still on your books today.

[00:10:47] Yeah. Come on. You have a property? No residential. Residential. Residential.

[00:10:51] And was it a big value ad? It was, I think put about eight or 10 grand to this thing and then

[00:10:57] turn around sold on contract. Wow. Look at that. Look at down payment. I think it's the interest

[00:11:01] of the contract. Like nine percent. Nine percent. So I got an our down payment. I think I gave

[00:11:07] like 144 and 75 hundred bucks down. Yeah. Nine percent interest is nice too. So GF zero.

[00:11:14] Yeah. Correct. Yeah. There are minutes. We're going to go down. Why structure these in a couple

[00:11:18] of things. But let's answer the big thing because I know some of the audience are going,

[00:11:22] this sounds crazy. So this is even possible that anyone would ever do an 11 year fully

[00:11:27] amtimes loan done. Anyone that's ever getting new germs? But so let's talk about that.

[00:11:31] Why would a seller do this? That's the great question. I get this all the time and I think people

[00:11:36] is minds are a bit too conditioned to be able to understand there's much bigger picture.

[00:11:42] Capital gains everybody knows about that one, right? And that's a huge thing people like to

[00:11:46] avoid. But the other thing that people forget about too is when that money comes in it also raises

[00:11:50] the income bracket that you're at. So that's two different massive fees that you're going to encounter.

[00:11:58] You don't have to pay capital gains. If you're trying to buy a property from somebody that's

[00:12:04] their primary, they don't have to pay capital gains anyways if they've been there for two years. So

[00:12:08] that's a great question to ask when you're talking to sellers as if this is their primary.

[00:12:14] Well, when it's not right you have the boosting of the income bracket as well as the capital gains,

[00:12:19] then you're left over with a much smaller finite amount of capital. Well, prior to that,

[00:12:24] they then have a much larger lump, where they can lend to me at most of the deals I'm doing right

[00:12:30] now are 4%. Now we do know that you can take it to a bank and get about 5.5 and a half depending

[00:12:35] on where you're putting that capital. However, that's that little smaller amount because they just

[00:12:41] paid capital gains and they just paid that. And then it's the whole process too. Whatever 5.5%

[00:12:47] that's not paying them monthly in its education. So why would a seller do that? Because they don't

[00:12:52] have enough education and when you educate them, there's tons of benefits to go for both parties.

[00:12:57] You know, oftentimes you end up with a down payment. They know like and trust this asset,

[00:13:01] right? Oftentimes they've owned the asset for years. In fact, nobody knows the asset better than them.

[00:13:07] It doesn't matter what it is, right? Well, there's a business. A car or there's a multifamily.

[00:13:11] You can sell it for an insurance. Sure. Yeah. There's a whole bunch of reasons. Another one is

[00:13:16] going down this as is path. Why would somebody sell a home as is? Why would they sell it for cash?

[00:13:20] Why would they sell it in discount, quote unquote? Right? Oftentimes because money is not the greatest

[00:13:26] motorbany tractor. There's a slow of other benefits. Time. The fact that you'll buy it full of

[00:13:32] crap. Yeah. Right? 100% you can buy a hoarder house full. Yeah. A realtor's an on-list in hoarder.

[00:13:38] No, they're not. Right. So there's not to reasons why somebody wouldn't have been doing it that way.

[00:13:42] And if you don't perform, they just get their asset back. They're in the same position as a bank

[00:13:48] would be. So it's like you listen, they get it down payment, they monthly payments if you mess up.

[00:13:52] They just get the asset that they know best back anyways. Right. Yeah. So when you're going through

[00:13:57] educating somebody, it seems like, you know, they're going to have a range of questions because

[00:14:01] you provide an options. You've given them three years. Just like go back to my lead into the

[00:14:06] signal and I give somebody an attended option of one two or three years. Oftentimes I get questions coming

[00:14:10] back, right? Yes. And so it's part of educating them along the way. So I'm curious as to what percentage

[00:14:17] you make three offers to one person at a time. How often they go in and bucket one two or three?

[00:14:23] So the first I'll still do that even when it's a seller finding it's not for, right? So yeah,

[00:14:28] the first when I listed those out was to figure out if they would do seller financing.

[00:14:34] Now if I already know that they're willing to do that, it will be the same thing. You know,

[00:14:37] just those couple different offers will be seller financing. Sure. Offers. The closer you get to

[00:14:42] huge with relationship, the closer you get to the seller, the less people involved, less heads,

[00:14:49] less agent, whatever it is. If you're being a good person and giving them what they want inside

[00:14:54] the offer as well, you're much more likely to get that. But in the beginning, I don't know, 25%

[00:15:00] maybe. Yeah. I was putting up. Just like you, you got to put out offers to, you know, but one out of

[00:15:05] every four offers is that they're okay to do seller financing. That's a great ratio to me.

[00:15:08] Yeah. It's incredible. And saying, yeah, all right. Tell me about one deal. Just pick a deal. Pick a deal.

[00:15:14] But deal, you can actually talk about it because I never talked about it. Yeah,

[00:15:16] a couple. And in previous weeks, we connected. We talked about, yeah, whole host deals that are

[00:15:22] in the pipeline or in the works. So I know, okay, I got this vacant building one time for 50k.

[00:15:28] Okay. This was actually my zero percent interest deal. It got brought to us by our church.

[00:15:32] And this goes to just speak about telling people what you do because there is no way we

[00:15:39] would have gotten this deal unless people in the church knew we had started. I'm not saying

[00:15:44] brag, it's just get out there. What do you do? And then when the other person asks,

[00:15:48] what do you, I'm a real estate investor? I think houses or whatever it is. So our church brought

[00:15:52] as this deal completely vacant hadn't been nobody had been in it for six years. I was like

[00:15:58] 14,000 square feet or something like that. I ended up putting the terms together and in Grant

[00:16:03] Cardone's 10x book it was if you buy anything cheaper than what it cost to build you always being a good

[00:16:09] spot. There was, I believe, like 78 windows in this building that were all brand new vinyl. So

[00:16:16] up $400 in window, we were looking at like 45k and windows alone without the building. It took me

[00:16:23] 10 months to clean it out, do some like painting a few places, figure out how I was going to build

[00:16:30] my first proper pitch deck. I went to the Rhea and like stood up in front of everybody's life.

[00:16:36] This is the deal I got. But 10 months later, I sold it. So I bought it on seller financing the whole

[00:16:42] time sold a 10 months later for 149,900. Only put in because my payments were going to principal.

[00:16:49] So I still got that back. I think we put in less than 7 grand into the whole thing of dumpsters and

[00:16:55] you know, other stuff along the way. Yeah. In Crow 1031 that into a sixplex and anchoring and I went to

[00:17:03] my agent. I think I was 25 years old. So I was still very new investor and I went to him and I was like,

[00:17:09] hey, I can either let you get your 3.5% on this or I'll give you 40% of whatever I make on profits

[00:17:16] but from here on out, you and I are business partners. We got to take all the money that we make from this

[00:17:21] and roll it into the next one and you and I are going on a journey together. He's about a decade older than me.

[00:17:27] And his name is Dustin Cupcut. I don't know if you know Dustin. I certainly know that. Yeah. Good guy.

[00:17:32] I've been a heck of a dream. Yes it is. And those in 2019. What got you attracted into the

[00:17:37] multi families over the singles? Because you made that pivot pre-quick in your career. Yes. My second

[00:17:41] property was a duplex. Cash on cash from a pretty big nerd with Excel and when I just did the

[00:17:47] math on my first duplex, okay, I'm going to still live in here. I'll still rent out a room in the

[00:17:53] unit that I'm on and then I'll rent out the whole unit. It just became a much different. I was like,

[00:17:58] oh my gosh, it's all about multiple doors in the same location. Makes that service much more

[00:18:03] reasonable. You bought a business. A body business. Tell me about that. So I bought a bar names,

[00:18:09] big shift. I've been an entrepreneur, not in a you've got to be here at this time for a very long

[00:18:17] time. But when I looked at the numbers two years ago I bought a 57-plex for 2.4 million in a net

[00:18:24] cash flows, 124,000. Bought the bar for a million. So significantly cheaper and it cash flows

[00:18:32] 270. Also less than 50% cheaper and no redoubled the cash flow. Higher to completely new team got

[00:18:39] six new bartenders, bound a new bar manager, he'll be taking over at the end of September. And this is

[00:18:45] just my next step into creating financial freedom for me and my family. When do you buy the official

[00:18:51] license transition happen two weeks ago? I took over about three months. Okay. Okay. No, I just

[00:18:56] lick your licensing and transfer. I'm generally curious because I've heard about bars in the past. Did

[00:19:01] you buy a business or have you buy yourself a job? That's a great question. To be truthful

[00:19:06] for the past three months I bought myself a job. But my reasoning behind that was,

[00:19:11] is I didn't think anybody would respect their boss that doesn't know how to do their job.

[00:19:15] So I knew I had to have to go into this grind season until I found a manager. But then

[00:19:21] what I didn't want to happen was find a manager right away, hire him and then he shit and I

[00:19:26] don't know how to train the next person. So now if it's a terrible manager dude, all right,

[00:19:32] you're gone. I control my schedule anyways. I'll come up to the bar until I find an manager

[00:19:36] and then I'm on to the next one. So I bought myself a job but here at the end of September

[00:19:40] I'm confident in the personal hired and the new girls I've got on the team that I'll have a lot of

[00:19:45] business. If you're a house clipper, execute the burst strategy or do double closings and are in

[00:19:51] a need of money. Little guy loans is your go-to lender here in the Des Moines area. Time is money,

[00:19:57] loan approvals and 24 hours, closings and five days. Little guy loans was founded by Neil Timmems

[00:20:04] and investor just like you since he has been in over 10,000 homes in Des Moines there's never

[00:20:10] an appraisal. Houses, multi-family and commercial property loans up to 1 million. Check out

[00:20:16] www.googleguilones.com. Going through a six-price, what do people want to buy yourself? It's

[00:20:22] a relates to hiring, training, ultimately investing in people. I'm not as systematic as I should be.

[00:20:30] I've done really good with being creative and pivoting and being able to adjust very quickly

[00:20:38] in difficult situations but I'm not as systematized and organized as I should be, which is what

[00:20:46] initially drew me to the business. This is a way for me to learn because of the previous owners

[00:20:51] they kind of took me under their wing. We'll show you rather than you just buy this and

[00:20:55] kind of go on. In that moment with just how I'm training people, I have way I'm typing down

[00:21:01] to give to my managers like this is how you train them so it's just repeatable. Both of them,

[00:21:06] the business is helping me better as a real estate investor. The only reason I was comfortable

[00:21:10] even buying the businesses because the knowledge I have as a real estate investor, how is it helping

[00:21:15] you become a better real estate investor? You get so used to only dealing with real estate investors

[00:21:20] or a very niche people and then when you deal with your tenants, you're used to that right?

[00:21:25] You're used to that shift but now in the bar people think I'm just a bartender. They have no idea

[00:21:31] the circumstances and it just lets me be more genuine and come a better listener and I care about

[00:21:38] just the same way I did with real estate but it's not always about I guess I'm still cracking

[00:21:43] a beer and making money off of you. True but just being present with what the people are saying

[00:21:48] because that's all they want. Just like the tenants want to be heard from their landlord or

[00:21:52] and the sellers want to get what they want from the buyer, the bartender wants to talk about

[00:21:58] his life problems to somebody that's there to listen while the same game. Interesting. Tell me

[00:22:04] about that on contract with terms. I did it. No! I built it around. I built it around. I did not

[00:22:11] go! I thought it was going to be amazing. I built it around terms initially but I got the seller

[00:22:17] actually went through something and gave me an opportunity and he was like scratch these terms.

[00:22:22] If you want to do a cash offer, I'll give you a significant discount on those. Like okay,

[00:22:26] you haven't seen my office yet but I have an office downtown to mwyne and the seller of the bar

[00:22:31] was also the seller of that warehouse and I bought that on contract which is what led us into

[00:22:37] the situation on the bar. It's funny how those things will. It really is.

[00:22:42] That doesn't go. What are you most excited about in the next year?

[00:22:45] The becoming a better leader. I've been really good about my readings every day again.

[00:22:50] That's been important and I think I team that trusts me in my vision and now I need to

[00:22:58] continue grinding it out and kind of see where we grow because we have a second acquisition

[00:23:03] downtown to mwyne that's coming. About property or a bill day in a business.

[00:23:09] Both. Yeah. But though we're going after both now. Okay, why could be exciting? Same guy.

[00:23:14] That's kind of taken me under as we improved. When you're a younger person, you really don't have

[00:23:18] much of value besides time. You don't have money. You don't have experience. You definitely don't have

[00:23:23] time. Energy. So try to connect yourself to somebody who's years ahead of you and it doesn't

[00:23:30] care if you're getting them water or getting them coffee or driving them around so that they

[00:23:35] can be on their phone and do emails. Figure out how to attach yourself to somebody with,

[00:23:39] you know, that's farther than journey and it will skyrocket your progress. Yeah, there's no

[00:23:44] about that. To be able to latch on to somebody. Do you have a mentor when you came? I've had lots of

[00:23:49] mentors over the years. And certainly a paid to get in lots of homes. Yeah. I like you and make

[00:23:54] believe our education. So if consumed lots of books and tried and done lots of things.

[00:24:00] What about the reverse side of that? Have you had a mentee? I would think so. Yes,

[00:24:04] you know, I used to honor remax for a number of years as I got, you know, started my career on

[00:24:08] that, both your set of the business, selling houses and we had a team there terrific team.

[00:24:14] And I like to think I attributed to it helped people from not being, you know, ultimately

[00:24:19] to first day in the business too. Yeah. Many have gone on while these success occurs.

[00:24:24] I want to be around for over just tremendous success there. Doesn't it

[00:24:28] supposed to be selfless? But it's almost a little selfish with how great you feel when you

[00:24:32] like teach somebody something and you see them go out and apply it. No doubt. Yeah. Yes. And then

[00:24:37] surrounding yourself with people who all to me today, we've got a killer team. And I think I'm the

[00:24:42] least qualified person to be here. Which makes me feel wonderful. Right. When you're the smartest

[00:24:47] person in the room, you need a room. Yep. All right. Yeah. You could do this what you do anywhere for

[00:24:53] here. Why? Why? Why? My son, I won't be here too much longer. I'd like to get my pilot

[00:24:58] slice. Oh that's the 2025, some of the things on my on the list is I want to get my pilot slice.

[00:25:03] Yeah. There's a place in Bound that does the training so I'd really like to do that. But ultimately

[00:25:09] I'm not, I'd like to move. But he's too young right now. Yeah. Now understand that.

[00:25:16] What are you for me? Yeah. Why? Well yeah. Why? Oh I love it here. Born and raised here

[00:25:21] went to school at Omaha. Play football there. I tried to look over there and then came back here.

[00:25:25] Bits in Crabble. People are incredible. It's a wonderful environment that you can plan

[00:25:29] better. Doesn't have the wild swings. Mm-hmm. You know, that's probably more in line with

[00:25:34] two of my person, Helen and the ability to plan at XCure from work with incredible people.

[00:25:38] I know it's your podcast. Why I'd love to hear about the first deal they kind of changed

[00:25:42] your path or when you pivoted like oh I want to do things more like this deal.

[00:25:47] So I was in broker for lots of years. I did very well. My 20s get to my 30s

[00:25:51] I've got a couple of dollars sitting around and it's like what am I doing?

[00:25:54] I don't understand the stock market at all. And so flipped the handful of homes

[00:25:58] and then I was at lunch with my good friend, Si Phillips, shout out to Si.

[00:26:03] And we were having lunch and he says you should buy a rental property. And I said oh you know

[00:26:07] all right well I'm gonna give us some thought. But I was at lunch. I don't know dare to later

[00:26:11] with my other good friend. I would call him a minty Jason Stuyvesant.

[00:26:15] Great guy. And Jason says you know I got this property. It's coming on the market.

[00:26:19] Probably not a good flip but maybe make a good rental to up in Urbandale.

[00:26:23] He's just telling me when he had going on I was like you know what?

[00:26:26] I'm in the rental game now. I think I decided at lunch right?

[00:26:31] I was like that sounds like one for me. And so you know with that handful of days whatever it's

[00:26:36] under contract and that was my first rental I remember everything about it. I know that

[00:26:41] has to be inside and out. Yeah right. You know that went on to about the one next door

[00:26:46] and then ultimately you know I threw four years later I had about hundreds of houses both

[00:26:51] flipping and turning into a rental portfolio. Are we called buying my first industrial building 17,

[00:26:57] thousand square footer? Hi, these are tenant there? They're bakery? Is hi, the only tenant?

[00:27:02] Yeah and most of your building single tenant, the industrial's are.

[00:27:06] Okay. Yeah some of the offices you know the one where we recorded it.

[00:27:08] Because like this one is a small-time tenant building in the office site.

[00:27:12] And so I remember buying that thing fast-forward you know two or three four months and I'm like you

[00:27:16] know what? I never hear from these people. This is where the department manager arrived at

[00:27:20] straight triple net deal. I was like this what did I just find? I felt like I found gold something.

[00:27:25] I was like this is so much easier than doing you know banging and adding it into a wall

[00:27:29] during single family reclass rentals. Yeah. They're certainly easier paths. It's very much

[00:27:33] so. Yeah. Until that led to you know shortly thereafter, mine whatever it was eight or ten or 12

[00:27:39] hundred properties. Yeah yeah we don't quite to go there's a busier path. Yeah.

[00:27:44] Even if they're not multi-family like that deal that we didn't we signed those ten single

[00:27:50] family houses that snorthy grand. Yeah right, so we got those under contract. But so many investors

[00:27:55] will be way more attracted to that than if they were the same property count but they were all

[00:28:01] over the place. I mean they're just right there it's yeah there's no doubt on the single family

[00:28:04] said if you can concentrate with an uplock with an neighborhood and you're in your building

[00:28:09] a portfolio your portfolio is more valuable with concentration versus scattered type. Yeah.

[00:28:15] Way more difficult to manage. Yes definitely. How many units do you guys manage now?

[00:28:20] 20 on the single family small multi-side and Airbnb I think it's about 25 and then a few hundred

[00:28:26] thousand square feet on the commercial side. Yeah because you guys only probably manage for yourself

[00:28:31] you don't manage anybody. Yeah God bless all the property matters out there. Yeah.

[00:28:39] Talking on the back side of the podcast and about proper management about ownership investment

[00:28:43] ownership and you said you know I've been doing this in lots of years he said the people who

[00:28:46] burn out are the people who are closest to the tenants and the people who are happiest are the

[00:28:50] investors for the away from the tents. That's good to know. That's sad that's sad. I was like you know

[00:28:57] it's sad but you and I both bought on a property is direct from the seller who are property managers

[00:29:01] who own their own stuff who are seasoned and it's a hundred percent true of it is. It's almost like

[00:29:07] natural progression into a being coming a tired landlord because you just consume all of your

[00:29:13] tenants stress and just issues with their lives that they don't bring that to your employer.

[00:29:19] Work, why are you saying you can bring that to your landlord? It's been beyond me but it happens

[00:29:24] frequently. Yeah it's unfortunate oftentimes their problem is now you're a property. Yeah. Well

[00:29:29] the bright side is of you have two paths to go down. He said there's a lot of happy investors who

[00:29:34] properly manage it but the right structures in place and that's ultimate with the show he's

[00:29:38] about investing not probably mentioned. Right? Yeah. It's just a good point of it.

[00:29:43] You ready for the final three questions? Yes sir let's get to it. One piece of advice you give

[00:29:47] your 20 year old self. Find content like nails to educate yourself and then go find a

[00:29:54] season investor and bring them water drive them around and spend as much time with them as

[00:30:00] physically possible. It's probably the number one piece of advice that's identical on this show

[00:30:05] is to go work for somebody who's free. Don't expect to get paid. Multiple people live.

[00:30:10] So what you've just said it's unbelievable advice. Every call they make just be quiet and listen

[00:30:15] to hopefully they'll put it on speaker phone if you're lucky enough to put it on speaker phone

[00:30:18] and otherwise just be quiet listen and spend time around see why they're doing what they're doing

[00:30:24] pay attention. Two books that change your life. The one thing? Oh here a killer? Yeah extreme ownership

[00:30:30] that was another job. Oh yeah my job go. All right ready for this one? Yeah I'm excited. If you were

[00:30:35] cast away on an island for a year you don't like it three pieces of data about your business

[00:30:39] each in every month I let you define your business. How do you see fit? What three things do you

[00:30:44] need to know each in every month? I really like this because I don't want to know if our

[00:30:50] debt service obligations were paid. I want to know our occupancy rate and probably the cash flow.

[00:30:57] What about you? All good things. I don't ever answer the thing. You're looking at every

[00:31:01] day to day so I'm not really flips it around on you. Not that one. No yeah so P&L

[00:31:08] what's the rent role? What do we have vacating? Yeah and then we don't have a report for it but

[00:31:13] I gotta know how my people are. How many people are doing it? Yeah right I've asked tons of questions

[00:31:17] you and I could talk for whatever. What's one question I did not ask that I should have asked.

[00:31:22] Man you are good at this one question she didn't ask. Maybe like why? When I do this?

[00:31:27] Yeah it was great let's do a tired my mom when my mom was boy my dad was in the military. He

[00:31:32] was hurt when the war had not arranged medically discharged and my mom had to start cleaning

[00:31:37] people's houses when he got retired and so at 21 years old dad did 32 years in the military.

[00:31:46] He got hurt down range. Mom's having to clean people's toilets it's like something's not

[00:31:50] adding up so did the solid take care of my mom. Only a couple months she's down to one to two

[00:31:56] days of cleaning a week. She's on payroll for the bar and for the real estate stuff and

[00:32:02] hopefully by the end of this year so we're done cleaning permanently. For people who want to

[00:32:06] find you they want to follow you if they want to connect with you we're going to go what you

[00:32:09] do. Instagram Facebook YouTube and TikTok Ethan Monten. Links are below in the show notes

[00:32:17] if you think I appreciate you being here. I appreciate it thanks for. Thank you. Thanks for listening.

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