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Interview with Jerry Norton

Interview with Jerry Norton

Jerry Norton Talks About Building the Ultimate Lifestyle While Traveling Across the Country in an RV with his Family

Video Replay of Interview with Jerry Norton

Podcast Replay of Interview with Jerry Norton

Show Notes:
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00:00:00 Hey everyone, thank you for joining us for today’s episode of real estate disruptors. Today we have Jerry Norton with flipping mastery and is here to share how he went from low margin, high volume wholesaling, flipping to high margin flows through new construction, a multimillion dollar flips. If this is your first time tuning in, I’m Steve Trang, broker, owner of Stunning Homes Realty, founder of the offer fast homes APP, the one app you need for wholesaling, and I’m on a mission to create 100 millionaires, so please message me if you ever need any help with your business. I know people are doing that now and I appreciate that. I want to give back as much as we can be excited for the show. Please give me a wave, please give me a thumbs up. And as a friendly reminder, I do not charge a dime for this show. I don’t make any money doing this. So here’s all I ask. This is what it costs for you to listen to this show. If you get value today, please tell a friend by sharing this episode right now, tagging a friend below or telling your best takeaway from the show later on. That way we can all grow together and don’t forget this is a live show, so please post your questions for Jerry answer. He’s an open book and he’s gonna. Tell us everything we need to know. You. Ready? I’m ready. Okay, so first thing is what got you in the real estate?

00:01:09 Well, great question. So I’ve been full time now for about 15 years and when I first got into real estate, I was working construction, digging holes, minimum wage, a mid twenties, you know, going nowhere in my life knew two things. I wanted to change that I didn’t know how a real estate was one of those things that was always felt kind of elusive, but I was a hustler. And so when I learned about wholesaling, I was like, I can do this. This is hustle work because wholesaling is also work, right? I can do this. Your mid twenties. Yeah. I’m in line with today’s demographic of wholesalers. Yeah, I mean that’s. You’re right, that’s Kinda, yeah. So if you’ve got some hustle and your mid twenties, most people can do really well with. And this was Detroit. So I was doing low end, low, low end. I’m talking like five and $10,000 houses. Detroit.

00:01:56 Yeah, when I started then. Yeah. Okay. Um, and then somewhere along the way you got into wholesaling and flipping. So what was that journey like?

00:02:05 Well, so first I thought I was a buy and hold guy. That’s what most people who get into real estate, they think of cashflow rentals. So at the time what was happening was I was working with a couple of wholesalers who were bringing me deals and I don’t know if you remember this, anybody listening in in 2004, 2005, but they had this, they had this, uh, no doc, no verification, no income loan. All right. Ninja. Like if you could fog a mirror, you could get alone. And that was me. I mean there was, they had no business giving me loans. What was happening though is I, a wholesaler would bring me these deals for like 20, 30. I put 20 into him, I’m all in for 50. They’d appraised for 80. They would refund me with no, no credit, no, no, nothing. They refined me at 50 and I’d turn around and do another one.

00:02:47 So this wholesaler in the course of a year, year and a half, I picked up 20 rental properties literally virtually without not having no business doing that. And I quickly learned what happened was I woke up one day and I’m like, this sucks. I don’t. I’m not made for this. Where’s the money? I was the question I had. Where’s the money? And I’m like, these wholesalers that brought me these 20 deals, they were making seven, $10,000 a deal. I was happy because they were fitting the numbers right? But I was like, Dang, these guys made a lot of money. I haven’t seen a dime with these rentals. What am I doing? And that’s when I kind of had a mind shift change and got out of all of those rental properties. Took me a little while, got out of all of those and went straight wholesaling and did wholesaling full time for about two years before I ever touched a rehab.

00:03:33 And as he went from that and he started flipping. Yeah. So then what happened was, is this is Detroit and what happened was as I started, I started wholesaling to out of state investors because the bottom fell out. Right. And so all this outside money was coming to Detroit. I called it the cheap factor, so California and then overseas I’d wholesale in my house, but then they couldn’t, they wouldn’t buy another one until they got that one fixed up and rented. So I was like, well let me help you do that. So by default I got into the renovating and so then I was doing a turnkey model where I’d, I’d renovate it, put a tenant in it, sell it, ready to go. I still a popular model today. Yeah, still works today, but I did. I mean I was doing 70, 80 of those a year for a few years until.

00:04:13 Oh, eight. Oh nine. That fell out. And at that time I said I got to reinvent myself. So I took basically what I was doing and went retail, so first time buyer market, the 1:50 to 200 price point and I started just continue what I was doing, but now flipping retail rather than the turnkey rental to investors because my investors were doing the same thing, they would buy one refi by another one [inaudible]. So I’d sell one guy 10 houses and it was, it was nice. Well, when they can no longer do that, I could only turn key to cash buyers. And so my model basically kind of fell apart. And then at which point from there did you turn into a higher end, your, your big transition? Because at one point he says, screw this. Yeah, what? Screw this volume model. Well, so a couple things happened.

00:04:59 Um, my wife and I had this, we’ve had this dream for years of traveling with our family in an rv and we homeschooled our kids. And so we had this vision. But at the time I was so tied to my business, like it was a, you know, I was doing 50 to 70 retail flips, fix and flips and some of your listeners, that’s not very impressive. Some of them it is, but I was a one man show doing that are really not real good. System’s just running around ragged. So it was, it was not. At first it was great because it was a lot. I was making good money, but anybody knows when you’re flipping after a while that wears off, you’re like, yeah, this, I’m making good money, but I’m not happy working like a dog. Yeah. And I hit that point where I’m like, something’s got to change.

00:05:40 The money’s awesome. But I’m no longer enjoying this. Like the thrill of the monies over the honeymoon’s over. I mean better than digging holes for minimum wage. So we, uh, so we started to have this vision of, well, what would that look like? And at the time I was like, there’s no way this whole thing would fall apart if I leave for a day. Right. So, and then at the same time something happened where a, I did this deal and it was, it was way out of my, my bread and butter or my comfort zone. It was a, it was almost a 400,000 arv and I’d been flipping hundred and 50 in Detroit. Yeah. Suburbs. Yeah. So on 150 arv is I’d make 20 5:30 profit. Right. And I was happy. That was good. That’s what I thought was the model. Well, I did this house that sold for like three 75 or 380 and I made 75,000.

00:06:28 That’s a little better. Yeah. Well what I did is I said, well wait a minute. I took a step back and I said, wait a minute. It was the same amount of time, energy and effort to do this one for three 75 as it was for these little ones for 150, but I mean three times as much money. So you went from 25 or $150 to 75 k on about 400. On about a 400 and. But, but here’s the big takeaway, same time, energy and effort, because I got to still manager, we have, I got to get a painter, I mean things a little different because it’s a bigger home and little nicer, but basically and more capital. I mean that was the big thing, more capital, but apples to apples, it was three times as much money for the same amount of time, energy and effort.

00:07:09 And that was the biggest Aha moment for me was why am I doing 50 deals a year? Why don’t I do 10 and make us just as much money or maybe even more. And that was kind of a transition I was going to at the same time, our family did a 30 day RV trip just to kind of test the waters. And we did that trip and it was horrendous. It was horrible. We had the worst experience ever. We had six kids, six kids. Well we were, the RV was too small and we were trying to cover too much ground and we got home and we’re like, okay, that dream’s over. Cross that out. We’re not doing that. But it, it, it, uh, and my business fell apart while I was gone for 30 days. Right. So we get back home and we’re like, you know, if we would’ve had a different setup, it would have been better and if we would’ve done this different than that, different and we couldn’t get away from just that idea of no nowhere to go open road.

00:08:01 Our kids real education, learning, spending time together. And so we came back to it and we got the right RV. We did. We got this 50 foot. I mean it was awesome. Custom built for us and we sold everything. I mean, okay. My 8,000 square foot house cars, boats got rid of everything. All we had left. Steve Fit in a one unit storage unit, like a one bay storage unit. That’s all he had left. He pulled the suburban behind the RV, left January 15th and went straight to Florida because this is Michigan Winter, right? Straight to three days to Florida, straight to Florida. And did a whole year. And when I did that, it was the biggest leap of faith in my business because I didn’t quite have, I didn’t know how it was gonna work out, but what happened was, is not being there in the day to day.

00:08:46 And also I kind of opened up and I said, you know, why can’t I do the same thing and other markets, why’s it have to be Detroit? Uh, there’s a learning curve there, but I started deals, you know, outside of my home market, following the same principles, right formula and you do these things and comps and all of that. And what I found was when I was forced to not be there in the day to day, I figured out how to manage things remotely. And I hardly work that entire year. Here’s the thing, here’s the big lesson I hope people take away. I hardly worked. I mean I worked a little bit but hardly like maybe maybe 10 hours a week was about it in the RV that year. But my real estate business made more money that year than any year previously. What do you agree with that too?

00:09:33 Well, I attribute that to building systems, first of all, doing higher margin deals. Yeah, right. That was a big one. But then also finding a way to get stuff done that I didn’t have to do and I, I, I couldn’t, I, I was so stunned that I was doing all of these things that I thought I had to do because I was there. That’s the biggest temptation when you’re there, you’re like, oh, I’ll just run out to the property and check on the painter, you know, are all, just go do that. And I wasn’t doing any of that anymore. I was, I was learning how to outsource all of that and I found that other people could do it probably better than I could anyway. And it just became a thing where I would manage a few processes, doing the right types of deals now and freed up so much time, you know, not being there at the job sites at the deals.

00:10:18 Well, so that’s crazy. Right? You had your business that you were, you know, it was going, but you were frustrated with and he said I’ll just let someone else manage it. I’m going to go hit the road and do what I do 10 hours a week. And it just kind of took care of itself. Yeah. So you were still getting deals sent to use your phone. I mean, I’ll know. What year was this? 2,000. 13. Two thousand 13. So you know, getting sent to maybe your iphone right. And you analyze it and then you’ll say yes or no. And then everyone else is doing the work.

00:10:45 Yep. I even had a first layer analyzing, so I paid a guy 50 bucks to analyze a deal that would come to me. Yeah, a 50 bucks. Right. And I don’t have to do it now. Right. So then it would come to me. So. So nine out of 10 he’d kill. I’d get the one that passed the sniff test.

00:11:01 So you paid him 50 bucks regardless of whether or not you took it down? Yeah. Wow. Okay. That’s serious. Yeah,

00:11:07 it. But it didn’t really cost that much for me not having to do it anymore. Oh my gosh. It was huge. Just that alone, she transformed my entire business is big nugget. Yeah. Yeah. And there’s guys that know this business like I. So, so this guy is a five deals a year guy. 100 full time, but he’s a, he’s a, I’m going to run to home depot, I’m going to do this. So as a side thing for me, he analyzes my deals, paying 50 bucks. He makes a couple grand a month. I don’t have to do it. Saves me hours and he knows what I’m looking for. So I’ve trained them well On. There’s two things, right? Arv and repairs. Yeah. You get those two right, then you can, you can get your by number. Wow. That’s incredible. Yeah. So it’s, it’s been working really well.

00:11:46 Okay. Any other big takeaways that you could, you could expound upon, right?

00:11:51 Yeah. So like if someone were to say to me, you know what, and I, this was one of your questions you were at, you were asking me earlier, was, you know, what advice would you give somebody new in the business? Really anybody is the thing. The mistake I made in the beginning was the same mistake everybody makes, which is this mindset of if I Hustle, then that’s how I’m going to win and that’s how I’m going to get ahead. But here’s the thing, if you work 100 hours a week, then you are only two and a half times an average employee working 40 weeks. That is huge for me because two and a half times working 100 hours a week, that’s seven days a week. That’s every waking hour you’re working in. All you’re getting is a two and a half times gain. That’s not scalable. It’s not scalable. Why would you do that? So I have a different mindset of figuring out your lifestyle first. And in today’s Day and age, there’s two things you need to scale a business without overworking its technology and its people,

00:12:50 right?

00:12:51 Right. If you’ve got technology and you’re using technology, right, you can save so much time, right? And if you’ve got the right team, people doing things than they can save you so much time. So I’ve been focused now on the past several years on how do I, how do I build out my technology and maximize and optimize and how do I get the right people doing the right things. And those two things allow me to not overwork but still grow and scale my businesses.

00:13:16 Now it sounds really simple, right? It’s just those two things. It’s. But each of those two things is amazingly detailed. Right? So I, I’ve, I’ve told many people that I’m incredibly blessed that I have amazing people behind me. If I didn’t have the people behind me, I wouldn’t be doing the show right now. I’d be returning phone calls, text messages, whatever. So, but it took me a long, long time of personal development to good this point as far as the people side. Right? Totally. And then the technology side, so I have an APP that we’ve created and it’s working, you know, we’re getting good feedback, but that wasn’t easy. So you built your technology, are you dealing with developers? You negotiate with the programmers? What does that like?

00:13:52 So I have all my own software that we’ve created and it’s uh, so my, my deal management platform is called flipster and it’s an entire. Oh that’s your company. I’ve heard of it. Yeah. Okay. So we developed that. It’s uh, it’s for flippers, wholesaling and fix and flip, but it’s an entire platform for managing every part of the business. So everything from everything from acquisition, analyzing, offering, whole wholesaling, your cash buyers, your crms, your website, like all of it. Eight is he funding everything, proof of funds. So we built a platform and I basically just took everything I had been doing for years that’s been on spreadsheets and kind of all over and put it in an all in one, all inclusive platform where you can just manage everything and it communicates with itself. And so it’s really cool. That alone has really helped me grow my business and manage it because here’s the thing, you can do one or two deals and be unorganized, right?

00:14:42 But if you want to start scaling, you start forgetting it. I mean, I don’t know who I talked to yesterday and Yoga. Where’d that go? You’re driving across town looking for your paperwork or that? Yeah. Oh yeah. I was a mess. That’s how I operated for a long time. And so that tool, uh, we have some really cool deal analyzer tools. Some, uh, we, I have one tool that is an on market deal finder tool and we get 1500, 2000 downloads of that software because I give it away for free a week. We get 2000 people download that a week. Amazing. And it’s just a time saving tool for on market. What it does is it, it basically gives you a list of everything that’s underpriced, which is probably a motivated seller, but weeds through everything on market and says, here’s, here’s, here’s what’s under the average price per square foot, here’s the percentage below.

00:15:30 And then there’s a way to organize and manage that data to keep it, you know, so it’s just a time saver, but it’s huge. Absolutely. Have something like that if you’re doing deals, it’s, it’s a, it’s a no brainer. So the way I do my, if you’re interested, see, I have a, I have a, a development team that’s in Pakistan and there are three person team. My lead developer is like 12 bucks an hour. He would be $180,000 a year. US Some guy. Yeah. Oh, we press them out there. He’s amazing. And he’s living probably top of the food chain in Pakistan and he manages a couple of guys. So when, when we do a big project heal, we just deal with him. He brings on help and that’s how we kinda build out all our software and tools as fascinate. Yeah. Uh, so you’re a licensed broker.

00:16:19 Tell me about that. So right when I got into real estate, I got my license not for, not for being a real estate agent, but just to have access to the mls because I wanted to set up my own showings, I wanted to access properties and I wanted to run comps and an o four o five. These other tools like zillow, redfin, they weren’t developed really then. I mean if you didn’t have mls it was hard to do the business line dark. Yeah. I mean you could get an agent but then you’re always waiting on the agent. So I just got it for my own investing. What I found was every year the broker would pull me in and he would say, you know, you’re not, you’re not making any sales, because I was, I was doing deals but not running them through the brokerage. So I’d have to find a new broker.

00:16:59 So finally I just said, you know what, screw this, I’m going to get my broker’s license. I don’t got to answer to anybody. So that’s my. They got my broker’s license. That license. That brokerage is still active in Michigan. I have usually five or 10 agents that, uh, work under that brokerage. I spend maybe a couple of hours a year in, in that business because I’ve got a, I’ve got someone that manages those guys and super hands off and yeah, but I keep it active and it’s great and they pay me basically a per transaction fee and then, and then I tell them, don’t ever ask me for anything. I don’t want to hear about it, follow the rules and the law and order your insurance. No insurance of all the rules. So they’re all investors so you know, um, and then you have a. I was kind of a surprise. So I was telling my buddy, Max, you know, Jerry’s coming on the show, Jerry and Erin was like, oh, that’s

00:17:50 the guy with the, with the big following. He’s got the program, whatever or not the program, you’ve got the youtube channel. So I looked it up. I was like, you’ve Kinda like 14,000 subscribers. What’s that about?

00:17:59 Well, just to put that in perspective, my goal is a million a million subscribers. Yeah. And it’s not about the subscribers. That’s just the benchmark, so everything I’ve done in my training business for the past eight, nine years, I was telling you this before the show, it’s all been paid advertising so you know, I’ll pay to run ads, I’ll get people in my funnels that do my books and my programs in my home study courses in my coaching and all of that, but it’s been a. So I look at that following though and we built like a million subscriber email list and so I know, I know online marketing, I know email marketing, I know those things, but what I haven’t done is I haven’t built any kind of, in my opinion, any kind of organic a following by giving, by really being impactful. Right? Or so now I’ve completely changed that.

00:18:49 I mean we’re still going to do advertising because it works, but now what I want is I want to really have influence and impact, but I want to do it organically. I don’t want to pay my way to it. I want to. I want to build that by giving good content. So that’s the goal with the youtube channel. We’re doing a video a day on the channel, um, but like I was telling you, my, my vision isn’t, you know, 15, 20,000 subscribers, it’s a million subscribers because that for me, that’ll be a benchmark that I’m really having a massive impact. Yeah. So, but I’ve got to, I’ve got to be able to really put out good content, consistent content and have it mean something to somebody for it to really happen.

00:19:24 Oh yeah. I mean to have a. When I was looking at it like a video a day, now it’s, I can’t even imagine doing that. So yeah, that’s real estate freedom TV guys. If you guys want to check it out, it’s pretty cool. Um, and it looks like we were talking about impact and given back, financial freedom seems to be the message, the core message. Yeah. So talk about that.

00:19:44 Yeah. So, you know, Kinda like I was saying a minute ago, uh, I want to, I want to be, you know, we’re, we’re dead a whole lot longer than we’re alive, right? So I want that to mean something. And so too often people get into real estate and it’s about the stuff, it’s about the money, it’s about the house and the luxury cars. And there’s nothing wrong with that. I want nice stuff too. Yeah, yeah. But I don’t want that to be my sole focus. And it was for awhile. It was all about the money, right? But, uh, I’ve got eight kids and I want to be balanced. I don’t want to overwork. I love real estate. But if, if I’m honest, it’s not about houses, right? It’s about what that provides. And so for me, I look at it, there’s four things. There’s be, do, give and be, do, have, and give to be the person, develop yourself, your talents, your hobbies, uh, be able to have nice things, right?

00:20:36 And, and do nice things, but also give back in a meaningful way and be able to do those things that really matter. And I think the only way to do that is to have time. And the only way to have time, I think you have to have financial, financial first, but if you’re, and if you’re careful than that can free up time. So one of my mentors, and this is kind of where I learned this, one of my mentors taught me that too many entrepreneurs get into business and they have this mindset of, you know, in the beginning I’m going to work 80 hours a week and 100 hours a week and then someday in the near future, hopefully I’m going to arrive and as soon as I arrive then I’m going to live my dream lifestyle. Right? But what happens is during those two or three years, you develop habits and then they get there and they could, they could change, but they don’t change because they’ve just developed these habits. So I’ve kind of looked at things and said, any project I take on, I look at it and I say, can I do it without overworking and becoming imbalanced? If I can’t and I don’t see a clear way to do it, then don’t do it. Right? So that’s Kinda my filter is, is it going to jeopardize my ideal lifestyle? Is there a way for me to do that thing? But, but not, not become imbalanced by doing it and overworking and I’m not perfect at it. Oh No, no. But I try.

00:21:55 So that’s. But that’s one of the things that, you know, we try to impart on, uh, at our brokerage and other people that we work with is that everyone has this idea that you’ve got this business and you figure out life around it. Yeah. Right. And it’s backwards. It’s backwards. You guide your life and your business surgery life. Yeah. And so yeah, a lot of people get that wrong.

00:22:14 Yeah. That’s why when I look at deals, so let’s say a deal comes in and I put it through a filter and the filter is first, my first filter is what do I have going on in my life right now? If it’s, if I’ve got a lot going on personally in my life than my, my step is wholesale it because then you’re done. Right? All right. If I’ve got bandwidth. So my second filter is an okay business wise, does this deal make sense to take on? So I either wholesaler fix and flip it. So fix and flip is a whole nother layer of management, right? Because you got to get funding, you’ve got to do a renovation. So then I say, is it worth the return on investment? Is this worth the time, energy and effort it’s going to take me to take on this deal and if I’ve got the bandwidth personally and in my business, I’ll take it on. If I don’t, I wholesale it and I love that model. Right? That’s a great model. It’s a great model because it keeps you in check so that you’re not overdoing it. Too many people are like, I’ll take it on, I’ll take it out, I’ll take it on. And next thing you know you’re working, you’re overworking and your relationships are falling apart, your spirituality, your personal, like your health, all those things go secondary and it’s all about the deal. The fastest way to broke. Yeah, and miserable and unhappy.

00:23:19 So guys that were married, this is a live show. So please do ask your questions. Okay. So we talked about you were doing 50, 75 deals in Detroit, right? And you’re wholesaling, it was a low, it was a high volume, low margin business. So a low margin on those wholesales and flips years flibbles 25 k, what was the

00:23:37 all sales seven, 10, seven years. Every now and then I’d get like a 12 or 13 and then that was a big deal. Now that’s. No, that’s not a big deal at all. Right? We’re a different market but.

00:23:46 So back then that was the. And I think those numbers are pretty consistent with today. Yeah. If someone’s wholesaling and flipping, yeah, you’re pretty average seven. The 13 is it? Music is a good target for wholesale and the flip is 20 to 30, right? So now three level entry level. Right? And so you’re, you’re talking about new construction in luxury. So let’s start with luxury. Okay. We’ll talk about new construction luxury. What is your um, how do you define luxury and after that, what’s your target acquisition? Great. So

00:24:18 to me, I think the safe place for people to transition to is the three to 600 because that’s still, that’s, I wouldn’t call that luxury. I typically call luxury over 600 in most markets. Now in California you can buy a shed, you know Sandra’s crap or cd or whatever. Right? But in most markets you start to change into a luxury buyer, usually over six, 700 because now you’ve got to start thinking about, you know, do I put in a sub zero, $20,000 fridge, you know, am I doing like crazy crown or am I going really? So. So your strategy details matter. More details start to matter a whole lot more, not three to six, they’ll three to six is basically the same thing you’re doing at 150 200 in a nicer neighborhood and a bigger home. So now it’s 4,000 square foot instead of 1800.

00:25:02 And it’s just, I mean other than that, you’re almost doing the same granite, the same everything else. You’re just a different neighborhood. So it’s, it’s an easy transition, but your margins go way up. Yeah. So I liked the three to six is kind of. That’s now my low end is three to six luxury though is pushing that six to a million, a million, 2,000,003. So for example, I’ve got a deal right now up in Scottsdale, bought it for 6:30 our. We’re almost done. Our Rehab was two little over two and we’ve got a couple of interested buyers at one point too. So I mean we’re looking at about a 400 gross now I’ve got obviously closing fees and carry and stopped. But a gross $400,000 spread on one deal. Yeah. And it’s still a six month turn, you know, like we’re turning it in six months, hopefully.

00:25:48 Maybe maybe a little longer time on market a right? Because you’re at that price point where you might have to wait for that buyer a little bit longer, but nothing really changes a whole lot more on my lower end model other than you better really understand that buyer what they want get, get. So get a designer and like don’t guess. Yeah, on your, on your electrical fixture, on your light fixtures and you’re, you know, don’t guess in a professional getting get experts. So I, I get experts, I get expert agents and designers and I really try to make sure I know that buyer way more than you don’t need to know your buyer at 200 grand. You need to know that buyer. A lot of them, they’re just out of those guys out there. Yeah. And it’s easy to figure out what’s in style today and all of that, but, but at the higher ends, you really got to know your buyer.

00:26:35 It’s very market specific, but you know, think about it. I’d have to do 15 houses at 25 a right or whatever, 12 or 12 or so to make the same on just this one deal. And here’s the thing, there’s way less competition buying a house for 600. It was almost no competition, almost no competition. Yeah. So not all markets can support it. Arizona can. Right? And so you got a hit, but every market has their high end. Every market does. I don’t care what market you’re in, there’s their suburbs that are your million dollar neighborhoods, right? So that’s where you go and there’s, you’ll find that it’s, you know, I’ve, I think 80 percent of fix and flippers are under $200,000 Arv. So maybe another 10 percent go from 200 to maybe 3:50, virtually none, maybe five percent or the higher end flippers. Alright. So it’s a different world there.

00:27:28 So we’re looking at a 600 plus. Right? So you buy in this one for 600 and you were talking about gross margin and 400. What is. Oh Hey, how did you, how did you source that deal? Yep.

00:27:39 Well, so, uh, I started, I picked Desert Mountain Scottsdale and then we just started really looking. So I like to look at new construction first and if I can understand the new construction market then I can kind of see, I can kind of see what retail is doing on flips around that. So same homes that are going on there that are, uh, your remodel homes. And then I try to figure out, okay, well, if this is what the new construction buyer looks like, what does the, what does the retail in that same neighborhood or that same area look like? And so I, but I always kinda go in first with new construction in mind and like I’ll give you, like for example, in Fountain Hills here, we’re doing one where um, bought the lot for 100. We’re doing about 800 construction, maybe 8:50 build 4,500 square foot.

00:28:28 And so I’m all in around nine and maybe nine slash 50, but I’m backends one for and so, and it’s a 4,500 square foot. I know my buyer, it’s a second home buyer from Canada that buys new construction and found hills. And I know because I’ve done my homework to learn what does that buyer want, what, no steps at all. Oh yeah. You know. Right. And, and what kind of. So pool and kitchen and all of that. We spent a lot of time trying to learn. Um, but from that and understanding that buyer, I can now start to look at the rest of Fountain Hills for example, and understand, well there’s a certain buyer that is not the new construction. Notch it down now. What are they looking for and how do I provide a product that’s like new construction? Yeah. Is typically the way I’ll go.

00:29:17 Okay. Uh, but going back to the other property in Scottsdale, how did you source that specific deal?

00:29:21 I just decided that I want us, I want us, I want to search that area. It was on market or that market. Yeah, it was all good. Good. Yeah. So it was on market and there’s three or four more that I’m really Ian, you know, I got to this one because it’s a little.

00:29:35 I’m pushing the market at one, two. All right. Pushing your market. So you’ve sourced it, you’ve taken it down then then I’m assuming you have

00:29:42 lenders that you work with on a, on a first name basis that gives you a pretty good rates. Yeah. So, uh, I mean, what, what 100 percent funding, so hundred percent funding about the rehab. So what I do is I do, I usually do an 80 slash 20 or 90 10, so I’ll get, I’ll get a hard money asset lenders at the 80 to 90 percent and then private money on the. So that’s total. So purchase and Rehab, right? That’s what’s so cool about the market today. Hard money lenders are cheaper than they’ve ever been. Oh yeah. I mean like single digits. I mean, are you kidding? I paid, I paid 15 to 18 percent when I first started and eight points.

00:30:22 But it was all that was available, right, right. You know, so. So now if you can show a track record, you can get down to nine percent. One point if you can. Now if you’re new, you might be paying 12 percent. Two points, uh, 80 percent. So come in with 20 percent. So I’ll use private money to cover the other 20 percent. I’m 100 percent. Okay. So you said six months. Hold time. Uh, you, you manage a cruise, you have a crew. What was that look like? Yeah. So there’s two models there. I liked the GC model and manage the GC. Now I haven’t always been under that belief, uh, but you have to, if you want to scale and you have to, if you want to do remote. So like I just did a deal in Houston, Texas. It was a hurricane Harvey House. I never saw the property once, not once.

00:31:06 I didn’t go out there in the beginning, middle or end. And so I had to rely heavily on my. I’ve got a system I follow for my remote deals and it’s basically you gotta have a GC, you’ve got a budget higher than you normally would, right? Because if you want a good gc you’re going to pay for it. Yeah. So I go into every deal 20 percent higher than my competition so I got to work harder because I got to buy it less because I’m paying more, but I want to build in my management into the deal. And then my system is, I have a narc who follows up on the, I call them monarch, but it’s basically someone that goes out to the property here was the title until back to tattle tattletale. Yeah. And those guys are cheap. I mean, all I want them to do is go out there and take pictures and video and tell me what’s going on.

00:31:47 Kind of like a secret shopper and the GC never knows when the NARC showing up. Yeah. So he can’t screw with me. Okay. Yeah, that’s a huge as, I mean, that’s a huge nugget. Yeah. I pay him. So I find someone really local. Usually it’s a freelance photographer on craigslist because all I need them to do is go out there and take video and pictures and tell me what’s going on. That’s it. His need to know any construction, nothing. The need to talk to anybody. So he’ll go out there at 10:00 AM and say, oh, there’s nobody here now call my GC. No. So yeah, we’re working away.

00:32:18 No you’re not. And so now I take massive action to correct if we’re off off our timeline, but I don’t need to be there. That’s incredible. I mean you also, it’s really just about everything. So you got the, you got the narc and you’ve got the GC. Uh, that’s pretty much it. That’s all I need. Am I missing anything? No, I mean all what I’ll do is I’ll get all the very first thing I do, so when I get an overseas or with cs remote deal out of state deal, I’m the very first thing I do before I even picked my gc or anything is I decide who my listing agent’s going to be and I go for a top selling agent and I make them double as my designer. So they come in right from the very beginning and they tell me this is what you should do and not do because they know, right? They’ve got the buyers, they know their market right now. Don’t do this with any agent, but a really top selling agent and they love it because I tell them, look, I plan on doing 12 to 15 deals in this market. I get them to do it for a flat fee. My whole thing was the 1500 bucks. Oh Geez. Okay. Now you’re not going to like that.

00:33:19 No, no, no. As a broker. And he won’t stop talking to that model now. I’m offended right now. Okay. Uh, so then now that what will, what will be the net profit percentage of the deal, like a luxury, like what’s the target?

00:33:33 So I still try to follow the 70 percent formula. So Arv Times point seven, less repairs and that gives me about a 15 percent profit margin.

00:33:42 Okay. So 15 percent profit margin is the target after gcs pay agents page,

00:33:48 not in the bank. Yup. 15. And a lot of people look at that and they go, well, why aren’t you happy to make 200 instead of $400? The reason why is you’re taking a bigger risk, right? You’re borrowing more capital sometimes. Sometimes you’re, you’re not right on, you might have to sit a little. I mean there’s things that can go wrong. So six months starts, I better hit a home run. Yeah, I better hit a home run. So I want that. I still want that 15 percent margin. Yeah, on the. Even on the big ones. Okay. And you should like, you deserve it. You should.

00:34:20 Uh, so now let’s take a turn. Whereas that was, that was luxury multimin multimin as the same margin for multimillion 3 million target. Okay? Yup. Now new construction, not a lot of people are involved with new construction and talk about what new construction.

00:34:37 So your formula is not, it’s slightly different, but what’s, what’s, as the fix and flip formula, it’s a little different because basically in with fix and flip, you got two things. You got your house in the Rehab with new construction, you have your lot and the build, but you’re still dealing with kind of two things. So with new construction, everything is about price per square foot. Like that’s the measurement. You look at everything, so your build price per square foot and um, your, your and your sale price per square foot. So once you convert your thinking with new construction to price per square foot, it allows you to really understand how to look at, at that model. So, and are really general rule is whatever you’re selling for price per square foot. So let’s take $400 a foot price per square foot. You want to be building.

00:35:27 Now, this isn’t always the case, but it’s just a general rule. You want to be building for $200 a square foot, so you have your cost to build is 200 square foot. You’re selling 400 bucks a square foot. Obviously you have your lot now in there and your lot if you’re about 10 to 15 percent of your sale price. So I’m trying to ballpark a little earlier, but it’s good. It kind of gives you a way now to look at things. So, so, but. But what’s nice about new construction is all of the guesswork is gone. Like what I do is I run my numbers. I think I’ve got my numbers, but then I spend the money upfront for my design micro textural plans and I’ll spend 10, $15,000 typically on a set of plans, custom plants. When I say custom, I want to, I want an architect to build a plan on that lot capturing views or whatever the right layout where your project and you know it’s not Internet plans for a dollar a foot.

00:36:25 No, not when you’re doing high end. After you’re building a 300,000, yeah, buy it off the Internet and Plop it on a 50 foot ladder, so we custom build it. That’ll you’ll have to invest 10 to $15,000, but now you can bid that out and when you bid it out, you bid it to the dime. It’s all new, right? So contractors now there’s no guesswork and let’s just change something. There’s no surprises when we also guys. Yeah. Oh my gosh. Rehabbing. It’s like I’ve done hundreds of rehabs and every single one it’s like, well he didn’t know that was there and oops, now we’re over budget or we didn’t know the sewer line was.

00:37:00 So that’s what’s. It’s more predictable and think about it. You know, there’s nationally treated builders, there’s not very many nationally traded rehabbers. Yeah, because every deal is unique to the deal. Whereas construction, no, you can have a model and it’s. You can understand your costs upfront. So then when I bid it out to builders right now, I know my numbers and I can say, does this make sense? Do I move forward? So I’ve done lots of deals where I’ve invested 10, 15,000, found out that my cost to build is way higher than I thought right now. It doesn’t make sense. I don’t do the deal.

00:37:34 Yeah. And that goes back to one more time when earlier by 15 percent margin because you have these other deals where you’re spending 50 bucks every time for the guy to underwrite it and you got these hard costs that they’ll deal happens. You still got that hard cost. Yeah.

00:37:49 Yeah. But well here’s what’s so cool about new construction. The other thing I love about it is you can be way more creative on your acquisition with lots. So. So lot owners will sell their lots and they’re way more open to creative financing then they have to be. They have to because it’s dirt and there’s no value in it. Right? Right. Now. So I’ll buy a lot of my dirt, I’m on terms and a lot of times what I’ll do is I’ll get that lot owner to subordinate and carry. So they’ll carry it for me and they’ll subordinate, meaning they’ll take a backseat to my construction loan, the second lien, and now my construction lender will look at the lot as my acquisition as my equity and they’ll give me 100 percent construction. So now I’m doing a deal. One hundred percent financed.

00:38:33 Yeah. And

00:38:36 I didn’t put a dime down on the lot because I’ll tell the lot owner, I’ll see. I’ll give you 200 for your lot, but here’s what I need you to do. I need you to wait to get paid til I sell it, but it’s not selling. It’s sitting there and you haven’t been able to sell it. So all I need you to do is subordinate to my construction lender. Will it still leaned up? Second place, once we sell the house, you get paid your 200,000 and you get your lot moved. Okay. As now that $200,000 lot, the bank or my construction lender will now look at that as basically $200,000 down and then they’ll give me the six or 700 or whatever for construction. So a hundred percent financed. That’s incredible. So that are you still looking at the same profit margin of 50 percent for new construction?

00:39:18 Okay. So then how do you acquire those new construction? Well now you’re, now you’re sourcing lots and so you gotta, you gotta start to really understand what your new construction market. So you always start with what is new construction selling for? And that’s the same as flipping, right? What’s my arv? And we’ll call it after repair, we would call it new construction sale price. Right? And so you start there, now you’ve got the second thing you’ve got to figure out is well what’s it going to cost me to build that house that sold for two point 5 million or whatever. Start to figure out that number and then run your formula and get to your lot by and now you know what you’ve got to acquire your lot for. Yeah. So it’s pretty similar, right? With houses you, you right? So you, yeah. You back into your bi.

00:40:03 Yeah. So here you’re backing into your lot by following pretty similar process. So then at the same construct are the same gc that’s doing your rehab is at the same gcs building these properties? They’re all completely different DC. Yeah. So they’re builders. Okay. So I’ll hire a builder to do the new construction usually. So like is there like a builder that you, you like in town or. Well, so every market is different. So in my, so I do new construction in Utah and in Utah the builder like the be a builder is so competitive that there’s a lot of them. And I can hire a builder for a flat rate of like 25 grand. Like here in Arizona they want 15 percent, you know, it’ll cost me a hundred and 80 grand to hire that builder where I can do the same thing in another market for like a really low flat fee.

00:40:55 So I’m always trying to figure out like how do I do this? What’s the right way to do it. Fascinating. Yeah. Every market’s a little different. So the other thing we talked about, we talked about luxury with heights about new construction when the advertising about virtual flipping. So we, there’s virtual wholesaling and there’s some people that play in that space. I haven’t heard a lot of people virtual flipping. So talk about that. Well, fix and flip. Yeah, yeah. Well it goes back to that GC NARC system. You’ve got to really have good eyes on the ground and it’s still not full proof like I’ve gotten. I’ve gotten into some bad whenever I get over my head on a virtual, it’s because I’m not getting the right information. And My gccs taken me for a ride so I ended up, I ended up not having the quality that it needs to be because he’s cutting corners because he knows I’m not there everyday looking at it.

00:41:46 So the way that you prevent some of that from happening is you got to have a really good eyes on the ground. So my agents got to be eyes on the ground. My narcs gotta be eyes on the ground. MIGC better be an honest good GC. If you can get those three things then you can do deals remotely. Um, but I look at every time I go into remote market, I try not to look at one and done because there is a learning curve. Every new markets there’s a learning curve. So I look at it and say, I like this market. I like what’s going on here. Um, I’m in it for the long haul. I’m not so worried about my first deal as I am my fourth or fifth deal. Yeah. Right. So let’s, let’s find the right team. Maybe that takes a dealer to get that right.

00:42:29 I don’t do so well. I mean, I don’t want to lose money, but I’m. But I’m looking at it a little more long term than just like one deal. Okay. You know, it makes sense. But I have a, you know, I have a pretty healthy relationship with risk and fear and most people don’t. A lot of people that want to get into flipping, they really struggle with that fear and fear of, well, fear of messing up, fear of losing money and anybody I coach, I tell them, you’re going to like just, let’s just get that out of the way. You’re going to lose money on a deal and they look at me like, what? You’re going to lose money on a deal just as a matter of time. If you’re not, then you’re not in the game long enough or you know, you’re not, you’re not doing the game. Right. Because you know, nobody bats a thousand percent, right? I mean, what’s a hall of fame? Baseball player? 300. Three 50, 300. Yeah, I mean, that’s good. That means you’re not getting on base seven times. So I kind of look at it and I say at the end of the year did I win more than I lost? And make sure that, that margin, that, that really shows really good, but you have to, right? Because you’re not going to hit it. You’re not going to do it perfect every time on every deal.

00:43:38 Yep. Uh, so max has a question, we kind of talked a little bit, but you know, someone that’s wholesaling right now in this market, right? So that’s who’s listening right now, a lot of them, 25, 30, and they’re wholesaling today. So what advice would you give them? If they want to make this a pivot to not just flipping, but luxury flipping

00:44:01 well, so if you’re, if you’re wholesaling, what I would say to a wholesaler is really sit down and think about your end game. Very few wholesalers stay wholesalers. Yeah. It’s a hard life because it’s such a hustle life, so it doesn’t, it’s not conducive to, uh, really the, the ideal lifestyle for most wholesalers. Now I’m generalizing because there are some that just ramp their model up and they just crush it and they just stay wholesalers. But generally speaking, what I’ve seen is people transitioned from wholesaling into the next step would be starting to do some fix and flips because you start to look at it and you go, you know, I pass that deal off for 10 grand. That fix and flipper just made 40 wait a minute. What’s he doing that I can do? And you start to think about, well maybe I should transition into that.

00:44:51 And so those are some things to kind of think about, well, where do you want to be? We’re are, do you want to stay a wholesaler? Do you like that model? So much so that you could see yourself doing it in 10 years if the answer is no, then start to think about what that looks like and what do you need to learn, what he needed to do to kind of start to transition into that. And that can be a two year plan. I mean, for me, I did it two years, five, six deals a month and I was happy as could be. It was great. Um, but I looked at the business and I said I want to always progress. How do I learn? What’s the next thing for me to do to progress in my journey? And it’s either do more wholesales or transition into higher profit deals.

00:45:31 And so that’s kind of one thing to really think about with, with a wholesaling. Okay. Well I like that. Um, so is there anything that you attribute your success to because you know, there’s a lot of people that flip [inaudible] what, what, what’s, what’s been the key to your success? I would say a b. developing my mindset more than anything else. So when I, when I first started wholesaling, I knew my mindset was wrong. I had a really bad mindset, scarcity mindset. I grew up poor. I had a belief that success was directly correlated with how hard you worked. As my dad taught me, good principal and I’m. My Dad taught me the same. Yeah. But it doesn’t equate to money like there’s no relationship. You tie the relationship. Yeah. So I thought I’m gonna if I work really, really hard for a long time, then I’ll see the fruits and it’s taken me a lot of work to change the mindset to more of a work smarter, not harder to get ahead and more of a, a business mindset.

00:46:32 And so this, this is like the biggest thing I could say to somebody is, especially wholesalers, don’t focus on doing a deal because maybe you do a deal, maybe you make some money, but in flipping every deal you do, you’re out of business, right? You got to do another deal to make money again. And so, so many flippers chase a deal instead of building a business that does deals. Yeah. And if you can adapt the mindset of how do I build a business that does deals, because now you have processes, you have systems, you have, you start to build a team, you start to think outside of chasing and hustling and doing a deal, and that’s the only way that you can really scale in this business and maintain a good work life balance and have a good lifestyle is you’ve got to develop out the business side of this. And I see so many wholesalers that just, they just focus on the deal, the next deal, the next deal, and they’re inefficient and they’re working really hard, but they’re not getting ahead. They’re, they’re, no, they’re no better off than they were last month or last year because they, they’re not developing out the business. So the business.

00:47:41 So let’s talk about that little bit because we talked about, you know, you got your guy to underwrite or 50 bucks and you got, you got an arc and the and the GC. That’s property specific for the most part. Yeah. So your operations today, right? So I mean, how many flips you have going on right now?

00:47:55 So I’m just a handful. It was a half. Yeah, I just do. I just have a handful of deals going on right now at any given time. So who, who is on staff in your organization? So everything I’m doing on my own ideal business, everything is a location specific, so whatever, wherever I’m doing a deal, I’m going to build my local team there. Okay. And that’s my GC, monarch, my agent. Those are my three key people, you know, titles important. But that’s not as critical, you know, but those are my three. Maybe a designer if I’m doing higher end than I needed, I need a good designer but I’m going to build my local team there. And then the other thing that I do that’s been really instrumental to my business as his bird dogs. Yeah. So I mean I used to do a million mailings, literally a million mailings a year, 2012.

00:48:45 I did a million mailings. Like that was my total mailings. I did and I did crazy marketing and now I’ve transitioned. It’s taken awhile. But now I’ve got bird dogs are nationwide and I teach them, here’s my criteria, here’s tools to go, like find deals on training and teacher, but find deals that meet my criteria and bring them to me. So now I no longer chased deals. Deals chased me. Yeah. And I mean, you’re bringing me some deals. And so, uh, so yeah. So that’s kind of my model now is if you buy into the bird dog model, it’s the most brilliant model ever, right? Right. Wholesalers, Bird dogs, finders. I kind of put them all in the same category. It’s other people that are willing to do the marketing than negotiating the contracts and bring them to me as long as they’re in my formula. I don’t care how much they make on a deal as long as it fits my criteria, my formula and that now has, has allowed me to really stop all acquisitions department completely.

00:49:46 Yeah. So you don’t have to have an acquisition department, a marketing department. It’s just the old come. If you build a good referral network, a good bird dog network. So then the other part we’re talking about was you’re either gonna flip, we’re going to wholesale. Yeah. So on the wholesaling side, are you the disposition arm? So the one that’s passing that on.

00:50:04 So my, my, uh, my same guy, so we have a process where we basically, if I don’t want it, but it’s a deal we call wholesale, so I don’t even want to develop a cash buyer list. What I want to develop is a wholesaler list because what I found is other wholesalers that are doing that business really full time, the players, they’re going to have a better cash buyer than I would or that I’m willing to develop. Yeah. So I’ll go to, I’ll go to you steve and say, Hey, I got this deal, a shopper to your shop it to your buyers and we’ll call wholesale. Yeah. And even that has worked brilliantly and I don’t even need. I can find the players on craigslist in about an hour, right? I can, I can find them, I can talk to them and I can call wholesale a deal in an hour if it’s a deal.

00:50:50 Yeah. Because if it’s a deal, those guys are going to have buyers ready to go. Right, and they’re glad they’ll gladly call wholesale with you. Yeah. Simple JV agreement done. Okay. That makes a lot of sense. In a lot of those are 20 grand, 30 grand gross that you’re, that you’re splitting with that wholesaler and so it’s a little different mindset because everything you learn about the businesses, build a cash buyer list, build a cash buyer list and then do this, do this massive acquisitions and you are, if you want to dominate as a wholesaler and own, own the whole thing, right? Acquisitions to disposition a. But since I’m kind of more focusing on higher margin flips, I don’t need. I don’t really need that model so much as not as not as critical to your operation. Yeah. So yeah.

00:51:36 Let’s talk about markets because you talked about Hurricane Harvey and whereas obviously here, heard about what you thought. So what markets are you? Are you, are you virtually flipping in?

00:51:45 Well, so it really doesn’t matter if somebody finds a deal that meets that criteria. I like, I don’t care where it’s at in the US. Okay. Now I have a few rules like I don’t like low end, so my, I mean ideally like I was saying earlier, I love the three to 600. I get really excited there because I can learn that model anywhere. Yeah. It’s, that’s an easy one to learn over 600 in a market, I don’t know is a little more work because there’s some nuances there because now you’re hitting luxury and that’s going to change market to market even what you do, you know, and what that buyer wants. Uh, the under 300 I don’t get so excited about and I won’t touch anything that ARV less than 100. Yeah. One hundred and 50 because it’s just for what you will make on that.

00:52:28 It’s not worth the time, energy and effort if you know how to make more for the same time, energy and effort at a little higher end. Yeah, right. Oh yeah. Oh, it makes a lot of sense. Yeah. Like I honestly, Steve, I see the flippers here in Arizona and it blows my fix and flippers. It blows my mind how competitive it is at the $200,000 price point, how little margins they make and how they’re. There’s one after another that’ll do it. I just, I don’t understand it. I don’t understand a five or $10,000 profit margin doing a fix and flip. Right. Well, for the risk. Yeah, there’s, there’s easier ways to make five or 10 grand. I mean the wholesaler made more than you did, right? Usually.

00:53:10 Oh, I think that’s kind of the attitude you see in there on our facebook farms. They’re like, man, the wholesale is, is he is eating better right now in the flippers are.

00:53:17 I did one. I did one this past summer. Steve, it was A. I picked up a package back in, back in Detroit, old park, Michigan. It was five houses from a burnout. I picked them all up and these were, these were my old model of 100 2,550 arv, little thousand square foot brick ranches. Twenty five grand easy rehabs. Like I just, I can do that in a, like in my sleep and one of them I was like, you know what I had done the other four. I’m done with this, I’m bored with this. I’m just going to wholesale this last one. I make two phone calls and I wholesale this thing for like 32 grand to a fix and flipper and I know what it takes to fix them up. I know what it’ll sell for and I’m like, he’s going to make 15 grand if he does everything right, he’s going to 15 grand.

00:53:59 I just made 32 wholesaling it so I get it. I mean I see why now there has been, there is no better time to wholesale, but here’s the thing, here’s the tradeoff. Harder to get deals, make more money than you’ve ever made wholesaling because the buyers are overpaying their way out of formula. They are like in Arizona, I think I talked to one wholesaler that does about 80, 80 wholesale. Don’t know if you know Dave Maclennan. I know of him. Okay. Super. Great Guy. Good friends. I grew up with him, so I know him for a long time. He told me, he said, Jerry, my cash buyer formula is 82 percent. Eighty two percent. Yeah,

00:54:38 that’s what it is right now. That’s what it is today. It’s 82 percent minus repairs. I don’t, I don’t know anyone’s paying 80 percent outright, but 82 percent less repairs. Yeah. Two percent less repairs. That’s been the form of about a year now.

00:54:51 Five percent, maybe 70 percent, right? Like, so all my God, I can’t. So if you’re in, if you’re in the low end business, if you’re going to flip in the 200 price point, do not be a fix and flipper be a wholesaler because the wholesalers are making all the money, right? Because they’re there, they’re getting off market deals, they’re making 25, the fix and flipper who was doing all the work, taking all the risk and taking all the risk is making 15, 10. Yeah. Crazy. Crazy how that is. But it’s because it’s because it’s harder to find deals. So when you get that deal, there’s a lot of meat on the bone. Yeah.

00:55:26 Uh, so we already talked about flipster it has the name of your, that’s my software, your software. So is that the tool that you can’t live without? Yeah, that’s the tool you can live without. Okay. Uh, and then what would you do if the market dips?

00:55:43 Well, so I’m the fortunate thing about flipping is you really should, you really shouldn’t get caught in the market because you’re not in it longterm. Right? So what I luxury though, you’re in a, in luxury, you are in it a little bit. So there is, there’s more risk. There’s especially like the Paradise Valley, three to $5,000,000 homes, those are 18 to year turns, so you could definitely get caught in some of those. Um, I actually hope that we flattened out and we level out some more in the market. And the reason why is because I think the majority of flippers will go away because they’re surviving on accident right now. Yeah, because they’re writing and appreciating market. So they’re screwing up and still making money when it’s a, when it’s a flatter market, they go away a lot quicker and then you’re left with just people that know what they’re doing.

00:56:34 Yeah. And I won. I think it would help the real flippers and I don’t mean that in a disrespectful way. No, not at all is we have the same exact manner in real estate, right? Like you can have an appreciating market even with price it wrong. So. So yeah. So if the market will just flatten some then all of these flippers at 82 percent making 10 or 15, they will go out of business because they’ll start losing money. Right. And they only need to lose money a couple of times before they go back to the job or whatever. Yeah. And so then we’ll get back to more healthy formulas and it won’t be so competitive on the, on the, you know, the buy side. And I mean when I went through 2010, I didn’t slow down one bit. Um, I had to work a whole lot harder selling, but I could buy any day of the week, 2010 world foreclosures were like, like reo is, I would just buy oreos like any day I wanted, but then, but then it was like getting your buyer to qualify for financing was a whole nother story.

00:57:34 But I did find them. So what is your biggest struggle right now? Well, it’s the same as everybody finding deals, getting deals, you know, so because the challenge I have right now Steve, is because so many flippers will pay 82 percent and I want to be at 70 percent. The player, the wholesalers that have a list, they can make more with their lists than bringing me deals. Right. That’s my biggest challenges. I’m having a hard time from the serious, like a player wholesalers who are good at getting deals because they can make more with somebody else. So where I’ve had to really rely on is the entry level new bird dogs, bird dogs that don’t have a cash buyer list. Don’t know that they could get more if they did and they bring them to me, but they don’t know how to get more also.

00:58:23 Right, right. They wouldn’t know. They don’t have a buyer’s list yet. Right? Yeah. So it works, but it means I’ve got to cultivate 10 times more bird dogs because nine out of 10 don’t stick with it. Yeah. Okay. And then what would you consider to be your super power systems? Yeah. Systems having a business focus on this. You know, if you think about it, Steve, if you’re a onesy, twosy, flipper, let’s take fix and flip and you put all your focus in finding the deal, all your focus in managing the deal, all your focus in marketing and selling the deal, and you can turn a deal in four or five months and then you start all over again. You’re only going to do three deals a year Max. Right? Right. And that’s how most flippers operate there. There are three to five a year company, but they could easily do 10 or 15 and half the work that they’re spending right now, if they just learned how to develop out some systems with technology and, and some team people.

00:59:22 Yeah. And there. And they would make way they’d make way more money and they’d have way more time and freedom. Right? Which is the end goal, which is why everybody does this in the first place. Like, why are you doing this? I found that I went from one job to another job. I made more money, but it was just another job and that’s not why I did this fulfilled. Yeah. I wasn’t fulfilled. So focusing on that lifestyle first is key. Absolutely. Uh, was the greatest lesson you’ve learned that success in this business is 90 percent mindset, 10 percent skill. You can learn how to wholesale. You can learn how to fix and flip. That’s the 10 percent. But if you don’t, if, if you don’t have an abundance mindset, you don’t have a healthy relationship with money and how that works with time, with success, then you’ll, you’ll just self sabotage.

01:00:07 You’ll never, your thermostat will reset back to broke and back to struggle and back to hardship and back to scarcity. And that’s so incredibly true about the thermostat. Um, so for you guys, I don’t know, you got your temperature Thermostat, right? If it says 75 and the room gets hotter, AC turns on and gets lower heat heater turns on. So we all have a financial thermostat and if you’re accustomed to a certain amount of money when you start, when money starts coming in, you find a way to blow it to get back to the same consciously. You don’t even know you’re doing it. Find a way to do it. And we see that with people that win the lottery. And I did that for a long time. I was roller coaster and I’m like, why am I broke again? I just made money, you know?

01:00:47 And so I had to really work on that. And secrets of the millionaire mind was transformational for me. T harv Eker, his book, I still listened to that book a couple times a year on. Oh really? Yeah, I’ve listened to it 25 times. Yeah, because I got to go back and make sure my, my, uh, know my well files are, are aligned, my affirmations and because you know, these things are ingrained in us from our childhood, they’re not easy to eradicate programs crammed in there deep and they’ll resurface, they’ll, they’ll rear their ugly head. You know, the other thing I think Steve is, um, you know, what I tell people is make more offers. And so I have a belief that if you make 100 offers a month, that’s five a day, five days a week, 25 a week, 100 a month. If you just do that, you will get a deal.

01:01:35 It’s the law of averages. It’s just, it’s just how it works. Exactly. But most people aren’t willing to do it. No, they’re afraid of rejection. They’re afraid of rejection. That’s the exact reason why they’re afraid of rejection. And I, I tell people this and they get to offer number 40 and then they say to me, you know what? This doesn’t work. And it’s like you’re giving up too early. Make 100 offers. You will get that deal of a lifetime. If you’re willing to make 100 offers a month, all right, just do it. Yeah, let it roll off your back. When you get the rejection, don’t sweat it and just make more offers. If that property still available. If they’re asking one 80 and you offer 1:10 and it’s still available next week. Offer again. Offer again, offer. Again, I can’t tell you how many stories where you know it’s, it’s listed for one slash 20. You offer 60. They say no, you offer Ganja, Ganja for again, six months later they take your 60. Like that happens more than you will think if you’ll just do it.

01:02:28 Yeah, right. Oh yeah. It makes a lot of sense. So Shawna Danda, uh, Amanda had a question. Is flipster a mobile app or a desktop APP?

01:02:36 It’s mobile friendly. So you log in just like you would on the desktop and it works just fine on your iphone or ipad. Yeah. Yeah.

01:02:43 So they want to learn more about flipster. How, how did, how did they do that?

01:02:46 So flipster, if you go to flipster software slash 97, that will take you to a, a video, you can watch where it goes through all what it is, it’s about a 10 minute video and then they can, you can decide a, there’s three different levels of it and then you can decide at the end of that video if you want to do the basic pro or prime. Yeah. And you get more things obviously, depending on which level you go. All right. Yeah. So it’s a monthly subscription. Yeah. Yep. Cancel anytime. Yeah, but you’ll find that it’ll, it’ll change your life. What I tell people is if you’re brand new follow, follow the flipster system of doing the data entry and the, you know, tracking everything. The temptation is, you know what, I really don’t need to do all of this because it’s just I got one deal going on and I can already know everything about it. But if you, it’s like anything. If you build the right mindset around it and the process, then when you start getting the three and four and five, you’re, you’re jamming. Man. You can do it, you can manage it.

01:03:52 Yeah. Yeah. Um, and then guys, this jerry is always looking for deals. Has got you built a nationwide referral network of bird dogs and if you want to send them the oldest pretty simply I do is. And you get paid $10,000. Yeah. Yeah. So he’s got the capital, he’s got the system and fixing them up and he’s selling them. So if you’re new to real estate one, ready to go by her or a seasoned wholesale, you want to get more serious cash. A biotech deals to just go to find houses, get paid.com, Fin d, h o u s e s g t id.com. And from there you can see a web training on how to get started on how to bring you deals. And then he’s also got that project we talked about earlier. It was real estate freedom TV. Definitely check it out. Uh, I, I watched a few episodes is pretty exciting. Oh cool. So, uh, and again guys, if you liked this show, please share this episode right now. And next week we do have Brian Cankdeska. He’s coming on, he’s another volume flipper and in our market, so he’s going to talk about his way of flipping and then I would be very interesting. Thank you guys for tuning in and thank you. Yeah, my pleasure. It’s been great. A lot of gems out of this. I’ll see you guys next week.

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