Nathan Cron is the broker at New Western in San Antonio and Austin. They did 370 deals last year!
Nathan is also a good friend of mine and we have done a lot of business together. He is one of my ‘go-to’ guys whenever I wholesale a deal.
In this episode, Nathan shares how he got started in this business by answering a newspaper ad after college. He credits his success to being blessed to get started with that company and getting the proper training. He now gives back by helping people get started through New Western.
He shares the stories of a couple of deals where he bought them, fixed them up and then rented them out for incredible cash flow.
Nathan shares my belief that it’s important to buy conservatively (cheap) and try to stay as debt free as possible. We talk for a while about how the market is always cyclical and if you want to be successful throughout each cycle, you have to be somewhat conservative.
Nathan’s strategy for attaining his goal of $10,000 month in passive income is just plain smart. He waits until he has the cash to buy the house without a loan. This way he gets incredible cash flow, tax benefits and security. He’s also a little different in that he rehabs these houses as if he is going to sell them. Most landlords do lesser rehabs for rentals to save money. He doesn’t want to have calls about broken toilets and clogged drains so he makes sure his rentals will be as maintenance free as possible. This also does wonders with attracting the “right” tenants. The tenants that won’t make your life miserable.
We also talk about how being resourceful is what separates those that succeed at real estate investing from those that do not
Anybody that’s followed the flipping junkie blog for any length of time knows I don’t care much for rentals (really, more specifically, managing rental properties). I really enjoy just fixing up a piece of junk house and selling it quickly for a nice profit. I’m sure I could learn to love rentals if I just knew how to do it with as little hassle as possible. That’s why I decided to have todays guest on the show. He is an expert on cash flowing houses and apartments.
This episode was packed for of information from Joe Fairless. He controls more than $21 million worth of real estate, attends more Third Eye Blind concerts than anyone else, is an author and comedian, and host of the very popular Best Real Estate Investing Advice Ever podcast.
Joe was very courteous today as I had problems with audio that delayed the recording of the interview for about 5 hours…. Luckily, he was flexible and was still able to be on the show. So, extra thanks to him for that.
In this episode Joe talks about the four single family properties he bought in Texas (he lives in New York) for cash flow (he sold one to cash out). He shares with us how he calculates the cash flow using the calculator mentioned in the links below.
He also shares insight into his first big apartment complex deal….168 units that he had to raise over a million dollars for!!!!
Do you know the difference between economic occupancy and physical occupancy? I didn’t. Joe breaks it down for us and why it’s so important to find out about economic occupancy when evaluating an apartment deal.
Joe also shares his ingenious strategy for determining if an area is improving or decaying by checking out two local restaurant chains that are in almost every city.
There are some great rules of thumb also mentioned throughout the show. Some are:
* 1 manager for every 100 tenants
* $250 per unit per year should be set aside for cap ex (capital expenses like roof replacement, exterior maintenance etc)
Enjoy the episode!
Mitch Stephen has been flipping houses in San Antonio for over 20 years. Over that time, he’s managed to purchase over 1000 houses!
He specializes in owner financing properties.
He is also the author of several books. One is My Life and 1000 Houses: Failing Forward to Financial Freedom, which details his journey in real estate investing and My Life and 1000 Houses: 200+ Ways to Find Bargain Properties.
And just to show you what kind of guy Mitch is, I want to share the story of how I got his first book.
I found out about it when it first came out and ordered it right away. I didn’t receive it within a day or 2 and, honestly just wanted to say hello to Mitch so I called him. He promptly drove 45 minutes to my houses and personally delivered the book to me. That’s incredible service!
In this episode Mitch talked us through a typical owner finance deal where he can buy a house cheap and owner finance it to a buyer as-is. There are a ton of benefits to doing this instead of renting.
First, he makes money on the sell with a down payment from the buyer. The buyer does the fix up so that Mitch doesn’t have to. The collateral for the loan is improved by the buyer making the loan even more secure. Mitch doesn’t have to pay the property taxes and insurance as he’s sold the house to the buyer. He also is not the landlord so he doesn’t have to fix toilets or anything else.
There was a lot more detail shared within the episode, so be sure to listen and be ready to take notes.
If you are planning on owner financing properties, you really need to be aware of Dodd-Frank. Mitch discusses how to make sure you are in compliance using a cool short-cut.
Mitch also discusses why he likes driving for dollars so much and some tips to make it even more profitable. He also discusses why he doesn’t feel bandit signs work as well as they used to.
You will also find out about his system for knowing which marketing he is doing is producing the calls he receives
Tucker owned a mortgage company and switched to investing around 2008-2009.
He wholesales, rehabs and does new construction.
Tucker talks about the transition from rehabbing to adding additions and moving into knock down and new build.
Learn how he determines which strategy he is going to pursue with the deals he gets.
He also tells us how he uses driving for dollars and direct mail to get his deals.
Tucker shares how he deals with the high levels of competition with key tips on how to talk to sellers to improve your chances of getting them to sell to you because they like you more.
Motivated sellers sell at a discount because they want the ease of disposing of a property. They know they are giving up equity in exchange for a quick, hassle-free sale.
“We’re in the business of getting people to exchange equity for ease of transaction.”
Mark Ferguson fixes and flips 10 to 15 houses a year and owns 15 long-term rentals. His grand plan is to purchase 100 rental properties by January 2023.
Mark tells us about how he got started working with his dad, who is a Realtor and house flipper.
In this episode, Mark shares his strategies for competing for properties on the MLS. Key points include:
<li>checking for new listings multiple times a day</li>
<li>getting out to see each house and make an offer within hours</li>
<li>have assistant in his office draw up the offer contract and send it to him to docusign and then forward to the listing agent</li>
He was also gracious enough to share his strategies on making his offers stand out by making them stronger. Some of them include, increasing the amount of earnest money, remove any contingencies (including the inspection contingency) and offering to close quickly.
Mark is smart because, even though his market is crazy hot right now as it is in many other places around the country, he has kept to his buying criteria. Others stray from their buying criteria and start to offer more for houses in order to get more deals. These are the same people that end up going broke when the market changes.
Seth Williams is an experienced land investor, residential income property owner and commercial real estate banker. He is also the Founder of REtipster.com - a real estate investing blog providing real world guidance for part time real estate investors.
This interview is packed full of interesting information about buying and selling vacant lots….and the really cool thing is that most of it relates to buying and selling houses.
Find out how he builds a mailing list that typically gets better than a 10% response rate along with the exact message he puts on his postcards.
Learn how he analyzes these deals so that he knows what he can offer and still make a great profit.
Seth also shares how he is able to sell these lots for passive income and make even more money.
There were several things that surprised me during the interview, like when he informed me that most people that buy lots from him aren’t going to build houses on them. Find out why, in today’s episode.
Top 3 Things We Love (and Hate) About Our Businesses
1. Freedom to do what I want, when I want
2. Large pay days (and thrill of the chase getting deals)
3. Working the business with my wife
Hate - strong word, dislike is more accurate
2. Bad contractors
3. Dishonest investors
Never a dull moment…ups and downs…
Seth’s Loves and Dislikes
1. Thrill of getting accepted offers - that it’s possible to get great deals
2. Passive Income
3. Large Paydays
1. Times when properties don’t sell immediately
2. Uncertainty of whether deals will be consistent in his pipeline
3. Cumbersome and time-consuming processes for buying and selling
He got started investing in real estate during college around 2005 and 2006. The <strong>real estate market then was white hot</strong> and that <strong>made it difficult to get good deals</strong>.
<strong>Seth decided to start buying and selling land. </strong>
Seth finds his deals by tracking down people that own vacant lots that are delinquent on their property taxes. He does this by contacting the tax assessors and treasures for the counties where the properties are and asks for a spreadsheet with the addresses and owner’s information.
Some will give out this information quickly and without hesitation and then some counties will make it very difficult, if not impossible.
He gets these records anywhere from free to up to 25 cents per record.
With records in hand, he then sends out post cards to the people that are delinquent on their property taxes. <strong>He says he typically gets better than a 10% response rate (which is pretty damn good) with these postcards!</strong>
Kevin Ramirez is from Venezuela living and is doing business in Raleigh, North Carolina.
He started in Real Estate at 19 years old with a flip, found a JV partner to fund the whole deal and after that fell in love with the business. He currently focuses on rehabbing and wholesaling. Every deal he has done has been without his own money.
Currently 21 years old, still a one man operation, he is working on building systems to automate his business. With 19 deals to date in 2015 he is looking to close the year with 25.
He doesn’t yet consider himself an expert and stays open to learning more and more every day.
What you will learn in this episode:
<li>How Kevin Ramirez was able to get funding for his first deals even though he was 19 years and new to the business</li>
<li>Find out how his first flip made a total profit of $65,000</li>
<li>Where he found his money partners and how he got them on board with him</li>
<li>What key points need to be covered in a Joint Venture agreement when flipping</li>
<strong>Kevin’s first deal generated a total profit of about $65,000!</strong> Not bad for any deal, let alone a first rehab deal.
Sharon Vornholt is the owner of Innovative Property Solutions in Louisville, KY. She has been investing in real estate since 1998 and has been a full time wholesaler since 2008.
Sharon is the creator of the Louisville Gals Real Estate Blog and the popular podcast “Let’s Talk Real Estate Investing”. She is also a mentor and a coach who loves teaching others how to succeed in this business.
How she got her start
Sharon’s dad was a contractor that used to drag her to a lot of different job sites. She owned and operated a house inspection company for 17 years.
She then attended a Real Estate Investor Association meeting and learned about flipping houses. She then started rehabbing. Her initial plan was to rehab and get big chunks of money to buy rental properties with. That worked for a while, but then the market changed….big time.
In 2008, she found it difficult to sell houses (as did everybody across the country). This is when she found out how awesome wholesaling was. She decided to try and sell a house she was going to rehab to another investor and see if she could make money quickly, without doing any fix up.
She’s been wholesaling ever since.
In this episode, Sharon talks about the differences between an assignment of contract and a double-close. The gist is that assigning a contract involves getting a house under contract and then selling the contract (as well as the obligation to close on the contract) to another investor for a fee.
Double-closing involves a little more complexity. Not much though. There are two transactions with a double-close. You have a A B transaction where the seller of the house sells the house to you as the buyer. Then you have a B C transaction where you are the seller and the investor that is buying the house ‘as-is’ from you is the buyer. he funding from the sale from you to the end buyer goes to fund the first transaction between you and the seller of the house.
For many people considering wholesaling houses, the fear of not being to find a buyer and not be able to close the deal if they can’t find a buyer scares them from ever getting started. Sharon shares how she allows for an ‘out’ by using escape clauses. During the show, we went over three good escape clauses that included: ‘subject to accepted inspected’, ‘subject to partner approval’, and ‘subject to funding approval’.
In this episode, Mike Simmons shares awesome information about his house flipping business.
Having an accountability partner in this business can make all the difference in the world. Mike’s wife was his main accountability partner that kept him in line and working to make his business a success.
Keys to finding and approaching a mentor:
<li>Go to REIAs and Network</li>
<li>Provide value - If don’t have much money, donate your time</li>
<li>Ask around for who is doing the most deals and approach them to be your mentor</li>
<li>Get started by educating yourself and start taking action by doing some marketing to find some leads - when you have a lead you can take to a potential mentor, they will for sure listen to you and be more inclined to work with you</li>
Mike shares how he found a great real estate agent to find him deals.
He also reads the copy of the post card that he uses to generate lots of leads and the criteria he uses for generating his mailing list.
Mike Hambright is a Real Estate Entrepreneur. He’s purchased hundreds of houses over the past few years, along with his wife, Lindsay.
Mike is a professional rehabber, wholesaler, and owns a single family rental portfolio. He is also a mentor and coach.
Some of you may know Mike as the founder of FlipNerd.com, the leading social platform for real estate investors where investors find and market wholesale deals, find and build a vendor team, build community with other investors, and much more…. a super cool site.
He and his wife were in the corporate world before getting into real estate and he came to the realization that he needed to be in control of his income. That’s when he got into real estate investing.
In this episode, we delve deep into how to determine repairs costs for typical rehabs. This is something many of you out there are struggling with and definitely something I struggled with early on.
If you can accurately determine repair costs for a rehab, you could lose money on a flip. Not good.
You’re going to get to hear some great rules of thumb for determine the most common repair costs.
Learn what domino effect to avoid when doing repairs to a house and hear how to determine just how far you should take a rehab and how to know the level of fixtures and finishes to use.
You will also hear how to make a decent guesstimate for an unknown so that you can go ahead with your calculations and make an offer quickly.
We covered a lot of repair estimate rules of thumb in this episode while virtually walking through a house.
Justin Williams has been a full-time investor for over 8 years. He’s flipped over 500 houses. He considers himself a house flipping machinist. What he means by that is that he is all about building systems so that he could scale quickly and do more with his time.
Here’s what you will learn in this episode:
I was busy doing most of the work in my flipping business and had a talk on the phone with Justin.
His excitement and approach to flipping through systems really inspired, so much so that I asked if he’d mind if I flew to California to hang out with him for a day to learn more. This was out of the blue, mind you and he still accepted.
I immediately booked a flight and spent a day of crash course learning from him.
Geremy Heath is the owner and founder of Texas All Cash Home Buyers. Texas all Cash is a residential redevelopment that turns around distressed properties for profit in the both the San Antonio and Austin areas. Since starting the company in 2009 Geremy has successfully completed over 150 rehab projects.
Geremy came to the US from Australia in 2006 and met his wife a couple months later. While at the airport to leave for their honeymoon, he purchased a book about real estate investing. Much to his bride’s dislike he burned through the book during their trip.
The fire was lit and he became passionate about leaving the rat race and working his way to financial freedom through real estate investing.
In this episode Geremy tells us how he developed the right mindset to be able to become a success with house flipping.
You have to expect to achieve the outcome you want. You have to believe you are going to make it.
Find out how to get the proper mindset in this episode so that your odds of success are greatly improved.
Brandon, house flipper, landlord, senior editor at Bigger Pockets, all around real estate investor shares what he feels is the best way to get started in house flipping.
He recommends people start with a live-in flip. The strategy involves buying a house that needs work and living in it while you fix it up and then selling it, either right away or several years later.
I completely agree with Brandon that this is an awesome way to get in the business and learn the ropes.
The benefits he describes makes this insanely obvious. Those benefits include:
* Getting a much cheaper loan than hard money
* Learning how to properly fix up houses
* Avoiding capital gains taxes when you sell the house (if you live in it for more than 2 out of the last five years - reference link here)
You can also get first dibs on HUD foreclosures as they usually give a 10+ day window where only homeowners can buy their houses. During that period, investors cannot bid on them. How awesome is that?!
* How my father inspired me to start flipping houses, which led to my wife and I flipping over 200 houses and changing our lives forever
* You’re going to learn the simple house buying rule that will make sure every deal you do will make you money
* Also, find out what major problem arouse when trying to buy 30 houses within 30 days…and it wasn’t buying bad deals
* He also shares his thoughts on what separates the people that make it in this business from the ones that don’t
Who is Frank Johnson? Frank Johnson has been flipping houses in south central Texas for over 18 years. He also happens to be my father.
He was my first mentor in this business and still helps me through tough situations and reminds me of things that I’ve forgotten…like always making an offer no matter what. If you go and see a house, even if it’s the last house you would ever want to buy…you should make an offer.
Hello! Welcome to the brand new Flipping Junkie podcast!
This podcast was started to allow you to learn how to flip houses so that you can become your own boss and take control of your life. Don't you want to be able to take vacations whenever and for as long as you want? Don't you want to be able to take your kids to school, pick them up and make it to every single function they have? Don't you want to ditch that life-draining job?
I wanted all of those things and flipping houses has allowed me to attain them.
Now, my mission is to help you do the same with the awesome business of real estate investing. Thanks for listening!