BiggerPockets Real Estate Podcast - 248: From Shop Teacher to Multifamily Syndicator with Todd Dexheimer

Episode Date: October 12, 2017

Looking to scale up your real estate investing business? If so, don’t miss this incredibly powerful episode of The BiggerPockets Podcast. On today’s show, you’ll meet Todd Dexheimer, who started investing in real estate while working a full-time job as a shop teacher at a Minnesota High School. Todd walks us through his journey of quitting his job and scaling his business to hundreds of flips and rental properties in just a few short years. You’ll hear how Todd analyzes markets before deals, how he puts together the financing on large multifamily purchases, and how he builds a solid team—no matter how far he’s located from the property. In This Episode We Cover: How Todd got started in real estate How he found and financed his first deal What exactly a 203k loan is How he bought a rental and a flip How to three projects at the same time while working a full-time job What his investing life looks like today How he scaled his investing to hundreds of purchases How he was able to gradually quit his job Tips for digging deeper with midsize multifamily properties What he looks for in a property Advice for getting the overall picture of the market (a unique way to study markets) How Todd manages to invest out-of-state How to get the right people on your team Why he chose Cincinnati The story behind his 84-unit contract How he manages his projects His ski resort story Todd’s vision of owning $200 million in real estate And SO much more! Links from the Show BiggerPockets Forums CBRE Marcus & Millichap ARA Rental Colliers Redi Cincinnati LoopNet Trulia Raising Money to Buy 1,000 Apartment Units with Brian Adams Books Mentioned in this Show Set for Life by Scott Trench Finding & Funding Great Deals by Anson Young (discounted!) Emerging Real Estate Markets by David Lindahl Rich Dad Poor Dad by Robert Kiyosaki The ABCs of Real Estate Investing by Ken McElroy How to Win Friends & Influence People by Dale Carnegie Fire Round Questions Is a roof deck on a multifamily worth building? What services could a person provide that would not be considered acting as a property manager? Short Term or Long Term Lease? Flipping a house with extensive mold (advice or order of repairs) Adding sqft to a home Owner wants to sell 9 mos from now…best way to tie up property? Tweetable Topics “It’s not just about good cash flow; it’s about your ability to get out of that investment in the future.” (Tweet This!) “It’s all a referral business. People talk about people they like and trust.” (Tweet This!) “If you’re going to try to raise money, you’ve got to have people who know what you do.” (Tweet This!) “Getting good tenants is the best strategy.” (Tweet This!) Connect with Todd Todd’s BiggerPockets Profile Todd’s Company Website Todd’s Linkedin Profile Todd’s Podcast Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 248. And I really did it slowly. I didn't purposely go out and go, these are the systems I need to be successful. This is what I need to do. I did it as I needed to. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the hype, you're in the right place. Stay tuned and be sure to join the millions of others who have benefited from biggerpockets.com.

Your home for real estate investing online. What's going on, everybody? This is Scott Trench. Did you say, you were about to say Josh Dorkin, weren't you? Yeah. This is the best. This is the best intro ever. Brandon Turner.

What's going on, Scott Trench? Good to have you here today. Thanks. It's good to be here. Thanks for making fun of me right off the best. Yeah, I'm glad you remembered your name. Whoopsies. It did sound just like Josh.

It did. You're doing better. You know, every time you sound a little more like Josh and it's creeping me out a little bit. I'm not going to lie. Well, check this out. For those people who can see behind me right now, you can see this beautiful oak door, if you're watching the YouTube version, this beautiful wallpaper right here that's all tore to shreds. I'm actually at my parents' house.

The home that I grew up in in Minnesota, and, you know, there's a lot of oak everywhere. where it's like oak threw up all over the house. It's fantastic. You move back in to save up for your next stop. Yes, exactly. No, I was on the East Coast and then I was flying back, but I knew I didn't want Rosie, my little girl, right? I didn't want her to have to fly six hours. So I was like, well, I'll just stop in Minnesota. It's halfway across the country for me and see the family and all that. Oh, my little brother, Chris, just had a little baby yesterday. My uncle again, which is pretty awesome. Little Elijah is new. So anyway, what's been new with you? Awesome. That sounds fantastic. I just had some, my parents in town this weekend.

they visited me. Ah. And yeah, it was pretty good. We watched some football toward the Coors Brewery, which is a kind of cool attraction here in Denver. I've not done that. It's had a great weekend. That's cool.

Next time I'm in town, you and I, you have to take me on a tour of the Coors building. Yeah. Well, maybe, maybe. Look at that, Scott. He's shooting me down publicly in front of hundreds of thousands of people.

It's kind of a long line. We waited in line for like a hour. I don't like, I don't do lies. That was more by, all right. All right. We'll go hang out and do something else. Yeah.

All right. Well, today's show, let's jump into the thing. Today's show is really, really, really, I mean, it's really good, but it's also like really like, it shifted the way that I think. And I think Hughes to Scott, right? Like, when we recorded this thing, like, both of us were like, man, like this just altered the way that I think about real estate in a large, in a big way. Perspective changing for sure. Yeah. Yeah, huge. And like seriously, I have to go make some big changes like today. Anyway, that's our little tease for you. But before we get to the show, let's hear today's. Tip.

All right. I didn't hear you saying quick tips, Scott. I didn't hear it. Quick. All right. You going to do it? Yeah. So today's quick tip is actually something that was mentioned on the show by Todd.

And it's a fantastic one. It's go out and try to get the phone number of the best real estate agent or a contractor or whatever person you're trying to connect with in the city that you're trying to invest. And then go on a referral hunt and call up their referrals and see what they're, names keep popping up in that market. And those are the people that you may want to consider doing business with. Yeah, follow that rabbit hole, as they say, you know, call one, see who they recommend. I love it. Super good tip. So, and there's a lot. It's actually a ton of really good tips in this, especially if you guys are like interested in buying, you know, I mean, well, let's talk about the

guest real quick. So Todd, Dexheimer, he started as a flipper. He was a teacher, jumped into flipping, jumped into then buying rentals, started apartment complexes, syndication. The guy's wicked smart. And talks a lot about how to do that. How do you. raise money. How do you deal with that kind of stuff? How do you find deals? How do you deal with brokers? How do you invest in a new area? All of that stuff we covered today and more. So with that, let's bring in Todd. I think, is there anything else we got to do? But we can tell people like we always do, you know, leave us a rating and review. It helps us. We're currently number 12 in all business. I want to be number 11 in iTunes. So leave us a review rating. And with

that, let's bring in Todd. Todd Dexheimer is a real estate investor who's been doing this since It's 2008. He has rehabbed or flipped over 150 properties, and he owns 130 plus rental properties in three states. That's crazy. You guys will hear this. It's awesome. He does a lot of cool stuff. So with that, let's bring in Todd. All right, Todd, welcome to the Bigger Pockets podcast. How you doing, man? Good. Good. Thanks for having me on. Yeah, this should be fun. It's funny. I did not realize it until we were sitting here talking together that we are both in the same state right now, state that I don't even live in. So tell us a little bit about yourself, where are you at? And, you know, how'd you get into this thing, real estate?

Yeah, well, like you said, we're in the same state. I'm in the St. Paul area, Minnesota. Minnesota. And about like Minnesota, about what, 30, 35 minutes away from you right now. Yeah, weird. We should have been hanging out together and done this podcast in person. Exactly, exactly. Yeah, missed opportunity.

Right? We could have went to Cambridge. Oh, we could have. My grandma's, yeah. I'm actually going to see my grandma later today. It's like my once a year trip home to Minnesota, I got to go see my grandma, you know. This sounds really bad, but like we don't know how long she'll be there, right? I got to go every time.

So you got to go. You got to make it work. I got it. She's like 92. So she's over in Cambridge. Yeah. Anyway. Perfect.

All right. So, yeah, tell us about yourself. Yeah. So I got how I got started. So I used to be a high school industrial tech teacher. So wood shop, metal shop, that kind of stuff. And my wife actually took a job in the Twin Cities. And so right when we got married.

And when she took that job, I was basically reading and just. just trying to, you know, past time when she wasn't here because she was, we were separated, basically. So I started reading real estate books, read some, you know, Kiyosaki books and really just liked it. I did construction in the summers. Every summer, I did remodeling construction. And so I really got into the whole real estate thing. And it just, it just clicked. And I was, I was hooked just off of books. And timing was probably really, really. really perfect because by the time I felt like I knew enough to actually get into it, the market had crashed. And property values are way down. And so analyzing and looking at properties,

the numbers worked. And so eventually when I was up in like the St. Cloud area, which is about an hour from the Twin Cities, hour and a half from the Twin Cities. And we moved permanently down to the Twin Cities and I started investing there. So yeah. So that's kind of how I got. started just reading books and just really getting into it, loved it, bought my first rental property. My wife and I actually, so we bought our first rental property. We also bought a foreclosure to live in. And then I also bought a house to flip all within like two weeks of each other. So, you know, I got in nice and slow. Wow. So can you tell us a little bit about how you got involved?

So we know you had your background of woodshop and, you know, had read some self-education with some books. How did you finance that first deal and how did you find it? Yeah. So the first deal, I think the first deal was officially my house. So that was with an FHA 203K, I think it's called. Yeah, the repair one. The repair one.

Yep, yep. So that's how I financed that. So we only had to put in like five grand, seven grand. something like that. Well, then my next, and so I've, I found that through just a real estate agent. Okay. Before we actually go on, can you explain what a 203K loan is? Because I love that loan. Yeah. So, you know, this was a long time ago. This was 2008 and I haven't done one since. So I know things change. Sure. So I'll just give it my best description. It's basically a renovation loan, FHA. So you're only having to put at the time, I think it was three, and a half percent that we had to put down on the purchase plus the renovation.

This house needed, let's say, $40,000 of repairs, and I bought it for around 140. So I got a loan for essentially 180 minus than 3.5 percent. So it allowed us to get into the property for almost nothing out of our pocket, essentially. But you have to live in the property, right? Yep, you have. So you have to live in the property. There's other nuances. Like you have to hire a licensed general contractor.

The good thing is I worked for a licensed general contractor. Oh, nice. So I hired him, and I was the laborer on the house. And so it worked out pretty well as far as that goes. So we were able to do the whole thing. And we ended up selling that house two years later and made a decent chunk, $30,000. But that was all while the market was actually. still just going down. So the market during during that time was still crashing. What do you think

that would be worth today? You bought it for, you know, 40, 40 into it. Yeah, for 350. Well, that's one of those things like, like, yeah, I don't know. People always say like, I always regret every property I ever sold. I mean, we still sell, but like, man. Yeah. It's crazy. So here, here's what I love. So what I, if I could jump in, the 203K loan. So I love this loan product. Those people have never heard of it. It's just exactly what you said. You can borrow the repair, costs and the cost of the purchase and they wrap them all into one and you pay three and a half percent down of that. It's part of the FHA program. And so, yeah, what's super cool about this. Actually, by the way, it works for single family duplex, triplex or fourplex. So I've met some people

actually just this past weekend. I met a couple of people did the same thing. They bought a fourplex, did a two or three K loan. So they're basically like double house hacking. Like, you know, we talked about the word house hacking a lot where you use your primary as a investment as well. And there's the flipping way to do a house hack. And then there's the, rental way to do a house hack. Flipping way as you buy a house, single family, fix it up and then sell it for more, like you're flipping it while you're living there. In other ways, you got a rental. So people can do both with that. But anyway, 203 loan is fantastic. It's annoying because it's, you know, FHA and government sponsored. So. And one thing I'll point out here also is everyone's got

their unique advantage in real estate investing. You say this all the time, Brandon. Todd, your unique advantage here, it seems like, was, you know, you found, you were able to use an FHA and two or three K loan and you found a reasonable deal in the MLS at a good time. But you were able to basically get paid to work on your property all day long, right? And that's, that's awesome. That's a huge advantage that you were able to leverage that and to make, make a killing on this first purchase. So props to you. Yeah, it worked out pretty well. So, and the reason why I know what that house is worth now is, so the next house that I did after that, that my wife and I bought was literally a block, not even a block away. It was on the same block. It was at the end of the opposite end of the

block. I bought that thing for like $105,000 and we ended up selling it for $325,000. We put a lot of money into it. But yeah, so I know that market pretty well. We lived there for two, to basically live in flips. Yeah. That's awesome. All right. So you started by doing these living sort of live in flips. At the same time, do you say you also bought a rental some more in there? So yeah. So at the same time, I bought a rental and I bought a flip. So the rental was, I think the next purchase. And, My wife and I had about like $20,000 left in our account, maybe 25. And so we used all that money to buy the rental and to fix it up. And then so the flip, I actually partnered with somebody.

I thought he had a lot of money. So I partnered with him. He ended up not having a lot of money, but he knew people. He knew people with money. So it worked. So we did the, I had three projects going on at the same time to talk about stressful. And I was working a full-time job. Ooh.

Yeah, it was crazy. And I was doing most of the work on these projects myself. The good thing is it was the summer and I was teaching. So for the first, it was towards the end of the summer. So at the end of the summer I was, you know, putting in probably 16, 18-hour days. And then the school year started, again, the same thing. I was putting in huge days. But out of the three projects, two of them turned out really well.

The flip ended up being more of a flop like most people's flips. I think I made $2,000 and I did pretty much all the work myself. So, you know, do you regret it? Was it a bad decision to do? Or was the education worth it? Yeah, I would say the education was worth it. It was it painful at the time? Yeah. Yeah, it sucked at the time because I didn't make any money. Yeah. So I'm sitting here going, geez, I worked. I made $2 an hour and it probably didn't even, quite frankly, didn't even make that. So actually, I didn't do a flip for another year.

Just kind of recovering from, like, I'll never do that again. Yeah, I was buying rental properties. I just wanted to buy rental properties and just keep on going. But then I ran out of money. So I had to figure out what to do next. So naturally, I went back to flipping to make money to be able to buy rentals. So can we get a quick, or not a recap, an overall picture? Like, what have you done now?

Let's go to today. What does your investing life look like? How many units do you have? What kind of properties are there? And then we'll go back and dive in and zoom in on some of areas. Yeah. So I'll just kind of recap a quick. kind of what I've drawn.

So from that time where I bought the rental and the flip and the, my own house, I started buying more rentals, ran out of money, started doing flips. I flipped over 100 properties and would also, at the time, I would use those funds to buy another rental property. So I'd continually buy rental property. So I ended up accumulating somewhere near 80 units or so. I've sold some since. I've got about 50 of those original still.

And then, like I said, I've done maybe 150-ish flips. Right now, I don't focus on flips. I'm focusing on building my rental portfolio, buying out of state, buying, you know, small to mid-sized apartment buildings. So I was going to say, what do you define as small to mid? Like what unit numbers are that? Yeah, so 10 to under 100. Okay. which the nice thing I hear and I just sold my 24 unit but the nice thing about those size is that

they're generally too big for the average person who wants a duplex but they're too small for the big guys. Have you found that to be true? Yeah, you know, it's funny because I get people on, you know, bigger pockets or wherever and a lot of people don't, it kind of bash that size between that, you know, 10 to 75 unit. You can't have on-site management. you know, all these things that are true maybe, but also you also get, I think, a lot better deal on them. As far as a cash flow basis goes, I think you can cash flow on those better than a lot of the bigger stuff and better than a lot of the smaller stuff. Because like you said, it's that in-between market where the big guys don't want to touch it and the little guys can't touch it.

And not to call anybody a little guy. But you know what I mean? I mean, it's just it's that in-between market. And so I tend to find a lot of better deals in that market. Now, again, you're probably going to sell it for a little bit less on a cap rate basis or on a per-unit basis. But your cash flow and your operations can, you know, likely be better. So I really want to get into this medium-sized apartment purchase because I think that's a big goal

for a lot of users. But before we get to that, I wanted to kind of quickly talk about that transition. from these first three purchases where it seems like you were really hands-on, heavily involved, to this scaling system where you did, you know, dozens or hundreds of purchases. So can you talk about, you know, it sounds like you're really hands-on at first. I can't imagine you were hands-on with all these units as you scaled. Can you talk about that transition out of maybe doing the work yourself and into building a system that can handle that volume?

Yeah, it was forced upon me, really. I'm a very hands-on person. I like to have that control. but what I ended up doing is I was finding so many good deals that I couldn't. I couldn't do the renovations. I would buy five properties at once. If you're going to buy five properties at once, they're all going to sit there except the one. So I was forced then to find people to do the work.

I was forced then to find people to help me with the books. I was forced to, you know, basically for my own team. And I really did it slowly. I didn't purposely go out and go. these are the systems I need to be successful. This is what I need to do. I did it as I needed to. So even when I would have contractors, I would run to Home Depot and get the materials.

I would do things like that, not knowing any better until then I would get so busy. I couldn't run to home depot anymore and I had to figure out, you know, what to do. I remember I bought, I had a car and I would load my car. I had a Nissan Ultima and the thing rode, you know, and like, I swear at like a 45 degree angle because it was full of so much stuff, you know, concrete and two by fours and all kinds of stuff. Yep. So, yeah, I mean, essentially I just forced myself to become more hands off through buying enough properties. And what about what about your career at the same time?

You know, you're still teaching or how do that work? Yeah. So in 2008, so 2008, bought my first rental property. So 2008, 2009, I taught full time. 2009, 10 year, I taught half time. It worked out perfect with the school district and how everything was set up where I could actually take a point six, I think it was, position. And then the next year, I quit my job. So I did the full year of the point six and then I quit.

So I want to make a point on this because this is something I think a lot of people don't think about is that when you have a plan, to quit your job, not you in particular, but people listening. They want to quit the job. A lot of people think it's a all or nothing proposition, right? I've got to quit or I've got to have a job. But there's nothing to say. I mean, most jobs, not all jobs, but most jobs, there's ways to transition out slowly. Like if you were to give your boss the ultimate, most people, if you're a good employee and you were to tell your boss, hey, I'm going to be leaving. You know, you don't have to say this way, but I'm going to be leaving. Like, you can have me for another couple years, but it's going to be a little bit more part time or you can lose me all together right now. Most people,

will take you at half time. And so just throwing that out there for people listening, if you're thinking of getting out of your job, it's okay to back off slowly. Did you find that, like sometimes it works out, like you said in your case, did you find that like it worked out well that way? Yeah, it worked out perfect.

I'm glad. I mean, I'm really happy we did it that way. It was really easy transition then. And it came all down to the numbers, you know, we were sitting there and I keep on telling my wife, I'm going to quit, I'm going to quit. She says, no way you're not going to quit. And, you know, it actually, we went to church and the pastor said something

that resonated with both of us. And on the way home, we're sitting there in silence. So all of a sudden she looks at me and she goes, show me the numbers and you can quit. And so that's exactly what happened. I showed her the numbers and the numbers worked. And she said, wow, you're actually making more income through real estate than you are on your teaching.

Yeah, you can quit. That's cool. And so I didn't replace my income until I was actually making more income. And that's where I think a lot of people just go, oh, I'm going to become a million, are doing real estate. And they don't think about, you know, yeah, you can. But let's make sure we're actually on the right track to become that. Did you, did you find life was getting, sorry, Scott, I know, I just catch off.

Did you find life was getting harder after you quit? You know, like, I mean, was it harder to get loans? Did you find that things got more difficult in any way? Or was it just in every regard easier when you quit? Yeah, in every regard easier when I quit. Because I already had enough experience. At the time I quit, I had a handful of properties. I had done a handful of flips.

And I had a handful of banks that were already wanting to lend to me. So that didn't really affect anything. And the other thing that was good is I have a wife that was working full time. Yeah. And making decent income. So that helps a lot too, having that second. I think one thing that's just not discussed very often, but I suppose must be true is as someone like you that has this big portfolio, it's expanding.

and rapidly accelerating, you know, lots of flips, rental properties. You know, the stressful point must be right at that point before you quit your job while you're working full-time and managing this portfolio that's taking up all your time. And then after that, you know, it seems like that's when things would get a little easier because you don't have the burden of full-time work anymore. So, but I've never heard it really discussed. Is that right? No.

No, it's not right. No. It's stressful in both ends. So when you have, when you have, when you. have your full-time job, you're completely stressed because you're pounding out so many hours. And literally, I would wake up at, you know, six in the morning, go to work, get done at whatever time it was, three o'clock. And I would work until one o'clock in the morning. And then I'd go to bed. And we had our first daughter during that time. And so talk about stress, because I was fixing up my own house. I was at times doing my own construction on the flips. And even when I started

transitioning out of that, I was still in charge of a lot of stuff. So that was extremely stressful. Then I quit my job. Well, now I got major pressure because I told my wife I could do it. And if I don't do it, I kind of look like a fool, right? And this I decided was where I'm going to be. And I decided that this was going to make me my wealth and that that was the path to go. So now the pressure's on. So it just changed to the stress level, I would say, in a different kind of way. I was still putting in a lot of hours. It definitely took some hours back, but it created a different kind of stress level. Okay. Awesome. Well, good to be proven wrong there. Let's move. Let's move on back to the apartment purchases. Can you tell us a little bit about your strategy for acquiring these, kind of where you're

looking for them, how you search markets and just kind of give us an overview of what you're trying to achieve? Yeah. So I don't necessarily know it's just mid-sized. It's all about the opportunity. I'm looking at where can I achieve my goals. And so I'm still looking at larger units. I'm still looking at smaller units. I actually right now have 130 unit under contract. But I've purchased quite a few in like the 20 kind of range. So, okay, so right now I'm, I'm purchasing. you're seeing out of state. And the reason for the out of state is because I can achieve my goals out of state versus in state. Now, we can talk more about kind of what that looks like. But I chose a market based on the fundamentals of the market and, you know, jobs coming in, employment, you know,

all the employment factors and the population growth, all that kind of stuff. So are you not, are you not seeing that in Minnesota where you're at? So, sure. So Minnesota is seeing great economics. It's very, the Twin Cities is extremely strong. We have low vacancies. But what we're not seeing here and why I chose to invest out of state is that we are seeing extremely low cap rates. Yeah. We are seeing very little cash flow. So I just got, I just had an offering sent to me yesterday in a C class neighborhood, 37 units, I believe. believe it was, trying to sell it for $100,000 a door in a C-class neighborhood at a five-cap. That doesn't seem great. No, they're saying it's got a value ad. So I'm looking at the value ad.

A, they are, it's a brokerage. They're very heavy on their rental numbers. I don't think those can be achieved. And even if they can be achieved, we're looking at about a six and a quarter cap in a C-class neighborhood. That's not attractive to me. So what is attractive to you? What do you look for?

Yeah, so I don't want to talk just about caps because that's not everything that I look for. Sure. But in general, if I look for value-add properties, and if I can take a property, if I buy a property at a five-cap, that's fine. But as long as it's got that value-ed component where I can get it back up and above the current market cap rate. So if the current market cap rate, let's say is at 7%, if I can get it into that 8% or even 9%, then I think it's a good deal because I've got that spread. When the market does shift, if it does go down, I've got some cushion there to where, you know, if all of a sudden we are selling for an eight cap, I still, I'm not losing money in that case.

So I'm looking for that cushion. I need a value add that's got at least a point spread on the market cap. Okay. That makes sense. Is there a certain cash on cash return, overall return, IRA or something like that you look for? Yeah, so I specifically am looking more for my investors standpoint. So I do syndications on my deal. So I'm looking at what can I make my investors in the deal.

So I've got to be able to make them between a 15 and 20% IR on my target. If I'm looking at a deal and I say my target, I think this is what we can do. It's got to be 20%. I might not tell my investors that it's 20%. I might say it's between 15 to 20 because I want to be conservative, of course, under promise. overperformed. But yeah, that's kind of what I'm looking at. What can I provide my investors? So overall, cash flow, can we achieve strong cash flow? Is the market rent affordable for the tenants that are, you know, going to be living there? Or are we just jacking up rents because we can?

And we're just going to squeeze our tenants. And then, you know, what's the, what are the fundamentals in that market? And that's what I think is happening in the Twin Cities. I think there's a lot of squeezing just because we can. There's low vacancy rates so we can squeeze so we can push rents to, you know, $1,200 for a two bedroom just because we can. So if not in the Twin Cities, what market are you finding these kinds of deals in? Sure. So right now I'm focusing in the Cincinnati area and Lexington, Kentucky area. Okay. Why are those markets? What do you like about them in terms of their fundamentals? Yeah. So again, Cincinnati has a really good job growth. It's just was there was just an article that it's the top growing economy in Ohio and one of the top

in the Midwest. People are moving into the area. There's a lot of gentrification going on. There's a lot of that movement that's happening that's positive. We're also seeing affordable rents. So people can actually afford to live in their place, even if you do raise their rents, which is what I really like to see. And then it's a city that I think has opportunity as far as being able to a true value ad property and getting that spread that I was talking about earlier. And that's what I don't like about the Twin Cities. I don't think there's any, I shouldn't say any, there's very few true value add properties. And again, you're squeezing your tenants anytime you try to raise your ramp.

So I think that's really important. You know, people, I hear people talk about they're getting into certain markets or they're investing in markets. But you've got to look at the overall picture, you know, what does that market do? When people talk about they're getting into Cleveland and Memphis and Montgomery, Alabama and whatever, that's great. If you're only looking for cash flow, those markets are fine. And don't get me wrong, they might be great markets because I haven't studied those in particular to a really close degree. So they might be good growth markets. But in general, you want to also look for growth.

Is this city seeing positive things happening to it, not just is it good cash? cash flow, but can I get out of this investment in the future? That's a really good point. I think that's a fantastic way to analyze markets. I mean, yes, cash flow is critical, obviously, to any investment, but so is opportunity. And I think that investors that forego looking at the opportunities, the long-term trends, you know, really miss out on potential big gains that folks like yourself, if you're correct, may achieve.

I did not know that about. And vice versa. Yep. I did not know that about Cincinnati. I'll have to go and look at that because I've never heard that. before about that particular market. Do you have any good ways to recommendations for people that want to study the market more like how do I find, how do you know Cincinnati is growing in population other than just

somebody telling me? Yeah, so several things. The major brokers have really good resources. So if you go to CBRE, Marcus and Milchamp, ARA, Coaliers, they all have reports that they put up quarterly on a lot of the markets. And they're going to have data right in there that they, pulled from the reliable sources such as the Census Bureau, co-star, that type of stuff.

So they've got great presentations. Those are fantastic resources. Now they are sales reps. You do have to remember that. Yeah. You know, don't completely rely on them. Cross-reference them. The Census Bureau, Department of Labor Statistics,

those are also great resources to go to and to check that out. The other thing I really like doing is going right on at the city web page. and finding out what they're what they're saying on their web page. Cities and counties that are progressive are going to show that on their web pages versus cities that really aren't doing anything. They're not going to talk about that kind of stuff. That's just how it is. And then are there nonprofits?

Are there nonprofits that are trying to bring in business? City has a Cincinnati, sorry, has a ready Cincinnati. Yeah, I think it's called Ready Cincinnati. It's a nonprofit trying to bring in small businesses. And then you can look at the comprehensive plan as well, Chamber of Commerce, all that kind of stuff. So put it all together, lump it in and say, is this, is progress actually happening in the city or are we stagnant and or declining even worse? That's fantastic advice. I think I'm learning a ton here right now.

Along the lines of this, you know, hey, you've cited on Cincinnati, you've decided in Lexington, Kentucky. How do you then go about building your team on the ground to manage these businesses? is. Yeah. That's definitely a challenge because you're out of state. One thing I did is I got a sideline number. So it's a 513 area code number. So it looks like I'm calling from Cincinnati when I call people. So when I'm first having my, yeah, because when I'm first having my conversations with, especially contractors, a lot of contractors are apprehensive to talk to somebody from out of state. And so I don't let them know I'm from out of state. We talk. We get to know each other. I meet them. We start doing business with each other. And they find out that I'm from out of state, but they don't care. And I might even tell them that I'm from out of state, but they don't care by that time because they trust me. They've built that trust. We've already paid them, that type of thing. They're dealing with my property manager. Okay. So how do you build that team? First thing I would say is when you're going into a new market and you've identified that market. Oh, one thing I wanted to say before we transitioned into this is I said a lot of people go when they're looking at markets. They go into like Forbes and

They just do like a Google search. You know, what are the hottest real estate workers? Where should I invest in? When you get, when you do a search like that, you're going to get Forbes and Business Insider and all these places and they're going to call out, you know, San Francisco and Seattle and, you know, all the, Austin, Texas and all the markets that have been hot in the past that were great, fantastic markets to invest in the past. But they're not forward thinking at all.

So just be careful by looking at those web pages. Yeah. And I'll comment that every year. out with a study on the best markets for real estate investors. And that is a past looking study. And it just says, hey, here's what happened over the last year. And it's for discussion purposes and interest only. And yes, that is exactly right. If you go to these publications like mine, they're fun to look at interesting. I think they do have some insights, but they are not predictors of a future performance. And really to get what you're trying to get at, you have to do exactly

what Todd is saying here. Yeah, you want to be forward thinking, not backward thinking. And Backward can teach you lessons, but you know, you can also get in trouble by doing that. So let's talk about building the team. When I first go into a new market, I'm contacting all the top brokers that are in that city. I think that's really important contacting those top brokers. And then I get referrals from those top brokers. Who are the lenders? Who are the property managers?

Who are the contractors? And then I go down that line and I keep on calling people. So I'm calling the lenders. I'm calling the property managers. I'm calling managers. And I'm asking them the same types of questions, who are the top real estate brokers, who are the top contractors. And so I'm getting referrals.

And you'll start hearing the same names a few times. And those are, you know, people that definitely you want to talk to. So you continually get referrals and feeding from those referrals asking for back referrals, basically. So just it's all a referral business. People want to talk about people they like and try. trust. Yep.

So, and then getting to know them, of course. I think being in the city is really important. I think there's a lot of out-of-state investors that don't want to actually take the time and effort to travel into the city and spend time there. So on that note then, let's say I'm looking, I mean, because like last week I was looking at a deal over on the East Coast. I live in, you know, Seattle, right? So I'm looking at a deal over like in Connecticut.

And, you know, I run the numbers. It looks good. At what point do I go out to. that area and start building the team. Do I wait until after the property is under, I get it under contract or do I want to do I, do you risk it ahead of time or or do you pick the, do you pick the market first and then find a deal on the market?

Maybe that's another way looking at it. Yeah, I picked the market first and then pick the deal from there. You know, I don't know where you found that property, but potentially you found it on like loop net. Exactly. Yeah. So if you found it on loop net, is it a deal? It might be.

Probably not, but you know, maybe. Right. Right. Right. There are deals on loopnet, and I don't want to discount loop net because some people just say throw it out the window. I've actually found some deals on there. So don't throw it out the window. But you want to get to know all the people in that market first. So I think going to the market first and understanding do you really want to invest in that market? I went down to Cincinnati, to Jacksonville, to Memphis. And I chose Cincinnati because I liked that market the best. I didn't really like Memphis in the idea of investing there.

I didn't really, Jacksonville was okay, but I liked Cincinnati better. So I took some time and actually flew to some different markets. I like that. And then I think you need to actually choose that market and you need to stick with it, at least for a while until you understand that market and can actually, you know, then expand from there. To me, expanding slowly is better than picking five different markets and just sprinkling your investments through a lot.

I've got a question more on the personal side of this. Cincinnati is a place where you're investing and making all these connections and meeting these brokers, I assume, flying out too regularly. How much did the fact, do you like the city? Do you like spending time there and did that factor at all into your decision to buy there? I would say probably on a subconscious level. Yes, I did like the city. I think it's a cool city. It's beautiful area. So I did like it. It wasn't, I didn't leave there telling myself, Wow, I really like Cincinnati and, you know, it's a beautiful area and I could, you know, spend time here. That's why I'm going to invest here. That's not how it happened. But yeah, maybe. I mean, it definitely was an area that I said, okay, I can see the, I can see what's happening in the city. I can see the positives.

And I see reasons why I should invest there. And I'm comfortable with enough areas to be able to make investments in. And that's the other thing. You want to be able to make sure that, you know, you're, you might see these deals on loop net or deals that brokers are sending to you. And they look like on paper, they're fantastic. But you want to actually go there because they might be D areas that the broker's telling you is a C plus area. Yeah. How do you know, how do you know an area is a C versus a D versus a A or B? Like, what do you look for in that like, is it just intuitive? You're like, oh, this is horrible. Yeah. I think, I think as far as a D area, yeah. It's intuitive. I mean, you can go there and spend a few hours there and go, okay, yeah, I'm getting out of here. If you feel, if you, if you've got shivers going down your spine when you're driving around, I think that's probably a D area. But how else do you find out? You look at crime statistics. You can look at go to like Trulia. They've got their heat map. So you can look at that. You can talk with the local brokers.

Again, they're sales reps. But you can talk to the police. You can talk to mortgage brokers. Mortgage brokers are, you know, they can't red line, but they're also going to tell you the truth likely. Property managers often will tell you the truth. So I think, you know, just getting engaged with all the people you talk to is going to definitely help too. That makes sense. That makes sense.

You mentioned a little bit ago that you were under contract on 130 units. Is that right? Yeah. So I've got 132 unit under contract and I've got an 84 unit on contract. under contract. Can we pick apart one of those? I mean, like, yeah, I mean, that's awesome. But can we like, I know you haven't closed yet, but. Let's do the 84 because I'm closer to closing on that. I'm, I'm doing my capital raise right now. Okay. The 132 I'll probably do in capital raise in, you know, a couple weeks.

Okay. So, yeah, I mean, how did you find it? How did you, you know, if you can tell us where it's at. Yeah, let's just what kind of walk through that story. Yeah. So that one is in the Lexington area. which is about an hour and a half from Cincinnati. Again, Lexington is just a different, a different type of city. I like Lexington because it's got an urban growth boundary, which means basically it's farm fields outside of the city proper. And then the suburbs are maybe 10 miles away, 5, 10 miles away. So it's a little different.

It's like Europe, if you've ever been to Europe. Yeah. So, and then they also have since like 1860, Lexington has had between 1% and 3% population growth. both every year without missing a beat. Interesting. So and there's no like you, when you look at the fundamentals, it's gonna continue.

So I like that city, it's just slow and steady and it's continuous. So this deal in particular, how did I find it? It was by forming a relationship with the broker, top broker in that city. And I've been reaching out to him and talking to him about properties, putting offer on two properties, you know, toured the city with,

with them, looked at a bunch of properties. And this particular property was next to a property that I really liked that I put an offer on. But that was a 40, 40-ish unit property. And I said, well, look, if I'm going to buy a 40-unit property in a new market, I really want to make sure I'm going to be able to buy at least 100 units relatively quickly. So are there any properties real close by that I can put an offer on that'll get me to a hundred. hundred units. I said, well, let me check. So they got back to me with another property. So I put an offer on that, and that's the 80. So I put an offer on the 84 unit and an offer on the 40 unit. I didn't get the 40 unit accepted. Somebody else bought it. But the 80 unit that wasn't listed,

we negotiated and we got the deal done. That's awesome. So that wasn't a listed property. That was just basically through my solicitation to the realtor, find me another deal. They found the deal and we got it done. Man, that's awesome. I've not actually heard that tip before, but find a property you want to buy and then ask them to go and find you more in that area. That's neat. So, yeah, because, you know, they're listing property. Their deal, their job is to sell properties, right? And it's easiest for them to sell the properties they already have in their books. But if you're, if you're diligent and trying to get them to find new properties for you, I think that helps a lot. And the other thing I do with, with agents is if I see a property that I like that

I drove by, I will, instead of calling them, calling that property myself, mailing that property myself, I will oftentimes just tell the broker that I like, that I want to do business with that I know is really heavy in the market. Look, I really like that building. I like whatever, Easter Ridge Apartments. Can you contact the owner and see if they'll sell it to me? And that that really helps build that relationship with the broker. Brokers are really important. Granted, are you going to have to pay a little bit more? Sure, you're going to have to pay essentially a commission, but it's worth it in the end.

Are you paying a commission when you buy that? Because normally on residential typically, right, you pay it when you sell. Right, right. No, I don't. I technically know, but when you really think about it, yeah. Yeah, they're going to compensate. The commissions, right, the commission's being paid. Yeah, also.

So I have a question about the financing behind this. You know, I assume that you're not a hedge fund. and have lots of capital sitting around at all times ready to deploy. And it sounds like you're offering on very different types of properties, different sizes, in different places all at once. So do you raise this money from your, in a syndication, before you begin offering on these properties? Do you know how much you can raise?

Or do you contact these investors after you spotted a deal and then raise the capital for these payments? Yeah, it's a little bit of both. I mean, I know that I have enough investors to get deals done, but I haven't got commitments from any of them. Potentially, it could fall through because I can't raise that money. But I've got enough investors that I can go to and say, hey, this is the deal.

Here it is. Do you want to do it? So I'm not just going in completely blindly and going, all right, now say my prayers and let's hope that we can raise money. But still, I've got to do, if these two properties completely go through, the other ones in the due deal is in space, so we'll see. But if they go through, I've got to raise $2 million in, you know, to a month and a half. Wow. So how do you get these investors? Where are you finding them? Because I'm not going to lie. Like this is, this is what freaks me out. This is the one

thing that stops me from doing bigger properties is I'm afraid that if I go and put it under contract that if I got to go raise $2 million, I'm not going to be able to do it. Because I'm not going to go on here on the podcast and be like, hey, everyone give me money, right? Like I don't, that would probably violate like a bunch of SEC rules but like probably would but like I worry about that like how like how do you know and then how do you find those investors yeah I struggle with that's I struggle with that still what I was doing a lot of deals and I wasn't telling anybody about deals I wasn't talking about what I was doing I thought it was just braggadocious if I said what I did so I kept my mouth shut and so now it's like wait a second now if you're going to try to raise money, you got to have people know what you do. And so that's kind of been my job lately is to educate other people on what I do and get interest from them. So it's all about getting interest from people, telling people what you're doing and trying to build that list. And I, quite frankly, I'd say I still have a small list. I don't have any really rich uncles. I don't have rich parents.

I don't have any family member that's, that's rich. So it's all through the, the friends network, which is the harder one to build, I think. And I came from teaching. So I didn't have any rich colleagues either. So that's definitely difficult. I mean, yesterday, so yesterday I left a meeting with one of my very potential investors. He's done a lot of deals with me. And I walked away going, am I going to get this deal done?

because he when he left the meeting he goes yeah maybe I'll do a hundred grand I got to really assess though because I'm looking to retire in two years and I don't know if I'll do any and I'm going I thought you're going to do 200 grand you know and and but then last night I get a text message from a high net worth individual super high net worth individual saying hey let's talk tomorrow about the deal and so it's like okay now I'll all of a sudden, I'm, you know, I'm thinking positive again. So it's a roller coaster. It definitely is.

And it's hard to guarantee you're going to raise that money unless you've done it a ton of times. And I've raised money, but it not, I'm not less massive syndicator or a public company that can raise, you know, $20 million with a drop of a pin. Yeah. So here's another question on that note. Then this is, again, the whole podcast is just me selfishly asking questions. But I struggle with keeping track of people who tell me occasionally, like I meet somebody and we talk about real estate and they say, hey, yeah, if you ever got a deal, I'd love to put some money in or I'd love to, you know, talk about being a lender.

I really struggle with a system for managing that. So what do you do? I mean, do you have an Excel document or what do you do? Excel document. Okay. I got an Excel document. It has their names, has, I try to get as much information, of course, from them, like their phone number, their email, and all that kind of stuff.

I haven't done it yet, but I will be starting a just a quarterly mailer. And, you know, everybody that I can put their email address in and just send them a quarterly mailer on what we're doing and what's going on in the market, that kind of stuff. Yeah, you know, there's an investor we had on the show a long time ago, Brian Adams, and he's an apartment syndicator. And I got on his list at one point because I told him, yeah, if you ever got any deals, you know, maybe I'll go in on one. So he put me on his list.

But every month I get a newsletter from him and there's like information. about the deals he's doing. And like, it's really, really cool. And like, every time I get it from home, I'm like, man, I should be doing this. Like, I should just have a list that I send people quarterly or monthly or whatever. It's just, hey, here's what's going on with my business. Here's all the wins that we're having. Because now if I have a chunk of money, I want to invest in somebody, there's a very good chance.

I'm going to throw it at him because I, every month, I see how well he's doing, you know? It's just an interesting strategy. Well, you know, Brian probably took some time at the beginning to get this thing set up. Yep. Right. But now I bet he spends very little time on a, his monthly email blast. And so it's just about getting it started and actually doing it, the actionable step.

There you go. I just love your mindset about the financing and building this network in the first place. For me, I mean, and I'm sure a lot of other new investors kind of feel the same way. It's not really in my perspective or reality to look at purchasing a property and then going out and raising the money to do it. I get my financial foundation set first. I have enough for the down payment plus some reserves and then I buy. and that's the that's a slow way to do it. I guess one question I'd ask in regards to that is,

when did this transition start? Did you start doing this from the get-go? Were you buying deals other people's money and syndicating from the get-go? Or did this kind of transition into your model over time? Started pretty much from day one. Like I said, I bought three properties all at once and that third property, which was a flip,

I bought with a partner who brought the money to the deal. The next, I bought three more properties. After I did those, I brought three more properties at one time and I didn't have the money for them all. So I brought private money into the deal. Again, I don't have this big network of rich people, but it's all about putting yourself out there. There's people that want to do real estate.

Everybody, here's my thought is everybody wants to be a real estate investor. I agree. Yep. There's so many people that have demanding jobs or whatever else or, They just don't want to take that actionable step to become a real estate investor. But everybody, I'm sure there's some people that don't, but everybody wants to be a real estate investor. So get them involved in your real estate business. So they are now real estate investors, partner with people.

Yeah. I think everybody needs to rewind the last 30 seconds to listen to that again. That is so true. Almost everybody wants to someday be a real estate investor. We're in a very cool niche. And, you know, I think we have to remember that we have something to offer. We're not just asking for favors from people. It's like, man, we are going to give you the opportunity to become a real estate investor to be cool like us.

You know, you'd be cool like Scott Trench and like Todd here. Like, it's a powerful thing. It really is. I've got, I've got some investors that have done flips. And they invest in my flips when I was doing flips. You know, they would see that they can do a lot less work and make just. as much money on my flip than they can on their flip. And so they would invest in my flips. I've got another investor that was buying a lot of rental properties and decided they don't

want to keep on buying rental properties or a hassle. So they'll just invest with me. And there's there's even active real estate investors that will invest in your deal. So it's just it's about putting yourself out there. And again, I've done a, I think a terrible job at putting myself out there in the realm of things. But I've never let any, anything stop me from buying a deal. And that's, that's the key. If you want to do this business, if you want to really truly succeed in it, don't let barriers hold you back. Yeah. You got to do it. That's so true. And they kind of sum up that like what I'm here, like what I'm kind of, the vibe I'm getting from you is two things. One, you say the word deal,

right? It has to be a deal. If you have a deal, you can probably raise the money. But then like, I love the fact that you have that mindset of I'm going to raise this money. It's not a question of will I or will I not. It's like, I'm going to do it. I just got to figure out how. So you ask that question over and over. How do I do it? So I just bought three houses. I don't know how to fund one of them. How do I do it? I just bought a duplex. How do I fund it? I just bought an apartment complex. How do I do it? How do? Like just having that mindset, no matter what level you guys are at listening to this right now in the podcast, the one of what level you're at, use that word how. It's the most powerful word in the investors language. I bought a ski resort and I had no

flipping clue how to raise the money for the ski resort. And I got it done. A ski resort. Okay, we got to hear that story. Yeah. You can't just throw that into the end. Like, hey, by the way. It's an old defunct ski resort in southern Minnesota. And it was just sitting there. And we stumbled across the piece of property, beautiful 176 acre piece of property. And ended up striking a deal with the guy.

Then ended up getting 100% financing from a local bank on that deal because the appraised value came in at like 950,000. And I bought it for 430,000. Wow. That's awesome. So the bank financed 100%. 100% it worked out great. Ended up not doing anything with it. I was tempted.

I tried to convince my wife to move down there and make that our place and run events and weddings and stuff like that out of there. But we didn't do that. Ended up selling it. And now the guy that bought it, young guy, he's running weddings and events and stuff like that out there. I just interviewed him actually on my podcast. Oh, that's awesome.

So yeah, that was pretty cool. He's doing well. That's cool. But sold it and made a good chunk of money. So there you go. All right. Well, man, this is awesome. So last question before we head over to the fire round is like, where are you headed? What do you envision the next five, 10, 20 years of your life looking like? So in 10 years, I'm going to own $200 million worth of real estate. And by the time I am 70, I'm going to have over a billion dollars worth of real estate. I love it. That's where that's where I'll be.

I love it. And again, I'm not, you're not, I'm not sure if I'm going to do it. I got this. You know? Yeah, that's cool. You have to. You got it. All right, very cool. Well, let's shift gears here and head over to the world famous. Fire round. It's time for the fire round. Managing properties can feel like a full-on circus. You're juggling vendors, tracking payments,

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for free. Because if you're going to hire a property manager, hire one that manages your investment like an investment. All right. So these are the questions that come direct out of the BiggerPockets forums, which of course our listeners can go and engage in by going to BiggerPockets.com slash forums and smart guys and gals like Todd. Not that you're a gal, Todd, but smart guys like Todd and gals like Mindy are there answering

your questions. get to it. Number one, is a roof deck, a roof roof? People make fun of me about how I say that, but is a roof deck on a multifamily building worth it? Say that again. Is it a roof deck? Yeah, a roof, a roof deck on top of a roof. A deck on top of the roof. Somebody's asking if it's worth it. I mean, boy, it really depends on your asset class. And I think on the market as well, you know, if you're in the downtown A plus asset class and that's going to make the difference. then absolutely. If you're in a C-class neighborhood, I would say probably not. So I would say it depends on, really, it depends on the market that you're in and what does that market need? Is that going to set you apart by putting a roof deck in? Is that going to make you the new trendy place? And can you, can you be a trendy place? Or are you just a workforce type housing? I think it makes perfect sense. All right. Next question. I'm thinking about giving my tenants a shorter lease in case things don't work out.

or I mean, you know, there's something wrong with them. Maybe something like a three to six month lease. And if they're good tenants, I'll offer them a year long lease after that. Is that something I should do or is there a better strategy? Get good tenants. I'd say that's the best strategy. Is it a good strategy? I would say if, let's just say, I come from a cold climate.

So winter is really tough for us to rent in. So if you have a lease that is renewing in, let's say, January, would I sign a six-month lease? Yeah. But if I've got a lease that I'm signing in, let's say June, would I sign a six-month lease? Absolutely not. I think it depends on your market. Our market, in the markets I invest in, I would not do a six-month or a three, especially a month lease. But if you live in a market where that makes sense, then potentially look at it. A three-month lease can be really attractive for a market where you've got a lot of people that move in and out of it. You can charge a little bit more.

And again, you can fire the tenants if you don't like them. And I think I'll add on to that. Like I've bought a few properties in the winter and, you know, you have one or two tenants at a time. I usually try to offer instead of a three to six month lease, a 15 to 18 month lease because then I can get them for a long time and their lease will expire in the, in the summer months. But as you said, I try to get a good tenant first.

So that that's not going to be an issue. Yeah. And I would say it's a decent strategy if you've got a property and more of like a a C minus D plus type area where you think you might not be getting the best tenants. So if you think you're going to get kind of rougher tenants, then yeah, a three to six month lease makes you just easier to get rid of them. But if you've got a good tenant with a good job and everything's working out well, I don't, the longer the lease, the better.

Yeah. And one other point on this. If you're renting out rooms in your house, that could be a good time to do a month to month lease or something like that because if a tenant doesn't work out, they're your neighbor. and you might want them gone suitor. Yeah, I was actually going to say the month of month, I think I'd do that over the three to six.

Yeah, I agree. Accomplishes the same thing. Well, and the other thing, too, is, you know, if you got a three to six month lease and you want the tenant out and the tenant doesn't want to leave, you still have to evict them, right? I mean, just because you tell them to leave

doesn't mean they have to leave. So if that's what you're trying to avoid because you got a terrible tenant, that's a good point. You might not avoid it. Good point. All right, next one. So the owner wants,

to sell this property, but he wants to move out nearly nine months from now. I need to come up with a good strategy for tying this property up while managing the holding costs and risk associated with that type of transaction. What's the best way to accomplish this? You could do a couple of things. You could put an option to purchase on the property where you just tie it up with earnest money, but you don't actually do with a physical closing. So he's still in charge of all the expenses and all that kind of stuff. You could do a lease back to him if you truly trust that he'll make those payments, all that kind of stuff. You could do a land contract with them for that time or contract for deed.

Yeah, I'm all about getting creative in real estate deals to get deals done. So finding out what his true goals are and you've already found out that he wants to stay there for nine months. Now let's let's make it work. You've got to do your due diligence and make sure you can trust the guy or girl. But from there, make the deal happen. Do whatever you need to do to get it done. so you're both happy. But I would say make sure you're either making him pay for all the expenses

or you are signing a very strong lease and then making sure he's actually truly paying you the right amount and that he understands that if he doesn't, he or she, I can't remember. I think you, I thought you said a he, but he or she actually pays and knows that you can evict him. I think it's great. All right. So what services could a person provide that would not be considered acting as a property manager. Let me pull up the actual question here because I want to get a little bit more detail.

It sounds like this person wants to help out landlords. Like help out as a way of learning. Right? So they want to help out. But they're not a licensed property manager. So how can they help out a landlord that they know? Do you have any suggestions on things that they can do that they wouldn't be required to be a property manager?

Obviously, it's a state specific thing. Yeah. And I'm not an attorney. So I'll preference that. Yeah. Somebody wanted to help you out. What would you have them do? Yeah.

And I have people do that. time. I have people that want me to help, you know, kind of mentor them or coach them or help look at deals. And I'll have them show properties for me. But I don't pay them in return. They get, you know, benefit from what I can offer them. So they'll show properties for me. They'll take tenant calls. If I'm out of town, you know, it's a great thing because I'll have people that can actually take, basically take over. So that's an option that you can get a certain, get a benefit from them by learning. not getting paid. You could also do contract services. So you could mold a lawn. You could do other small maintenance things. I suppose you could even do showings and get paid for showings. Maybe not.

It depends. I would say you want to make sure you're definitely not cross the ballroom. The other thing, that would be really easy if they just made you a small ownership interest in the property, which some companies may want to do and some companies might say no. But if they gave you just even just a little bit of ownership interest in that company, now you can be doing other things and getting paid for those specific things. So that's a potential, but that would be probably somebody you really trust. Well, that's a tough one. I would have to talk with an attorney because, you know, you're right.

Yeah. You need to be a property manager if you're going to do property management. What other potential to consider is becoming a, employee. I believe that. Yeah, right, right. Yep, that would be definitely an employee would be good. All right, cool. Well, hey, let's go to the last second of the show, which we lovingly refer to as our Famous Four. This week's Famous Four is brought to you by finding and funding deals by Anson Young. This book is absolutely incredible for anyone who's struggling with the two greatest problems when invested in real estate, which are finding good deals that are going to make you money and

figuring out how to fund those deals. So this week only until midnight on the Wednesday after this podcast episode launches. You can get 20% off your finding and funding deals book. So go to BiggerPockets.com.com slash store and you'll get either the physical, the digital audio, we're all three at 20% off. Again, BiggerPockes.com slash store, finding and funding deals. With that, let's get to the famous four. Let's do it. All right. Question number one, what is your favorite real estate related book? I'm going to give you two. One is emerging real estate markets by David Lindel and the other one is ABCs of Real Estate Investors. by Ken McElroy.

I love both of those books. I've read the second, not the first, but now I'm going to go pick up the first. Yeah, I'm very interested in the first one as well. It's a great one. If you're thinking about going out of state, definitely it's a good one to read. That's awesome.

Yeah, and I remember that actually when I read the ABCs of Real Estate investing, Ken McElroy talks a lot about that in the advanced guide that came out after that. The advanced, yeah, a lot about understanding the markets. And, you know, honestly, like, I feel like this episode, just the last hour here, my entire perspective has changed a little bit from,

I've been looking for the deal everywhere. And I'm like, man, I got to look for the market first. I got to really zone in the market. Yeah. And I think in Ken's book, he points out several markets that if you had read that book at that time when he wrote it and started investing those markets, you'd be doing unreal. Because I think he picked out some of the North Carolina markets.

I think he picked out either Portland or Seattle. Yeah. Yeah. Cool. All right. Similar vein. What is your favorite business book? I like how to win.

friends and influence people by Dale Carnegie. Gets you in a great mindset. And just it just, it's a really positive, powerful book. Yeah, it should be required, required reading, I think. Absolutely. All right, so besides your vacations in Cincinnati

and Lexington, Kentucky, what do you do for fun? What are your hobbies? Yeah, so besides real estate, I bow hunt a lot and camp, camp and hike and play hockey. Awesome. From Minnesota. From Minnesota.

Of course you got to play hockey. Yeah. There you go. Played hockey last Friday. Nice. You have all your teeth. I do have all my teeth. Yeah.

I wear a helmet. Good. With a face mask. I am, by the way, I'm from Minnesota and I still can't. I can barely skate. I can like stand up and like shuffle.

That's about it. Really? Really. But the Mighty Ducks is still my favorite kid movie of all time. Yeah. I will watch that any day. All right. Number four.

What do you believe sets apart successful real estate investors from those who give up fail or never get started. You know, I guess, I mean, there's a, there's a lot of things, but it's not giving up, just committing yourself to what your, what your goals are. First, you've got to, of course, figure out your goals and know what that truly means to you. And then don't give up and be persistent. The other thing is be patient, especially with investors, young investors that are young or old, that are just trying to get started in today's market. And we're, We have a market in most areas that is pretty hot and deals are hard to come by and numbers don't work oftentimes.

And if you've studied and learned and understand the numbers, make sure the numbers work before you buy a deal and just be patient. Understand that you don't need to buy a deal today just to become a real estate investor. I think that's really important. That's where people, of course, in 2005 and 6 got in trouble. They're just not being patient and they just, they need to do a deal to become a real estate investor and they're going to fake the numbers and hope that it works. Just just never fake the numbers and be patient. I like it.

That's solid. Solid advice. All right. Where can people find out more about you? This is your chance to plug. Yeah. So a couple of things I've, by the time this show airs, I'll have a web page that you can go to at Venture D as in Dexheimer properties. venture d properties venture d properties

dot com also you can check out my new podcast that'll be airing the first episode the second week of october so by time this is aired this that that should be out we should have several episodes out that's called pillars of wealth creation and we're going to talk about real estate we're going to talk about how to run and operate a business and we're going to talk about financial success and freedom and how that all ties together and that podcast. And the other ways, of course, on bigger pockets or on LinkedIn, you can just look me up at Todd Dexheimer. All right. Well, Todd, this was fantastic. Seriously, like, this is one of those like mindset shifting shows for me in a lot of ways. So I'm super pumped to going out and analyze

some markets right now. So yeah, I'm doing the exact same thing after this. It's a, it's a fun business. I love it. I love every day. Every day to me is Saturday. So I just, I just love it. Very cool. Thank you so much. Todd, this is awesome. I'm sure we'll see you around. And yeah, keep in touch. Yeah, thanks guys. Thanks for having me on the show. All right. That was our interview with Todd Dexheimer. Amazing stuff. Man, like you said earlier, like prospective mind-blowing shift, isn't it? Yeah, absolutely. I thought, I thought that I was, I might have thought that I was some hot stuff with my investor market survey that I come out with once a year. This guy's research and what he puts into these market studies puts, that's a shame. So I got to definitely revamp that whole process and look at how to how to do all

that. This is a great, great episode. Yeah, it really was like, yeah. So I, yeah, different markets. I mean, like, we don't talk a lot about studying markets, but man, like now I need to go study some markets. So I just feel like I was doing it all wrong, you know, like, I, like, I've been looking for this mobile home park or a multifamily, something to 1031 into. And I've been looking all over the place. But now I'm going to, I'm going to pick a market. I'm going to focus it on that and then I'm going to look for deals within that market. I think that's, it makes a lot of sense. Yeah. I think another part of it was just how he approaches his business. I'll worry about the money after I find the deal. I'll worry about my network after I find the market. This is opposite of what a lot

of investors seem to seem to say on the podcast, on past episodes of the podcast and kind of opposite how I approach my business, but it makes so much sense. It's definitely something I'm going to look into. It's kind of like the jump out of the plane and build your parachute on the way down. You've heard that analogy like it's like that. I kind of like that. Like, you know, go for it, do it. And then, you know, don't be stupid and risky, but like do it and and figure it out as you go. And like, I think that's smart. Otherwise, people just get stuck in analysis paralysis for years and never do anything. So anyway, there's your encouragement of the day. So cool. Anything else you want to add before we get out of here? Scott Trench. That's what you got to do if you want to own a billion dollars in

real estate as is Todd's goal. That's awesome. All right. Well, I'm going to go hang out with my mom. So, because I'm at her house and my dad's at work, but I'll go hang out with my mom. I'm going to go hang out with Josh. He'll probably yell at me for hog at his office. You are. Oh, by the way, you have a new Instagram. Do you know what it is off top of your head? I want to get people a shout out to you go to your Instagram. Oh, I do not know what it is off the top of my head. Well, find Scott's Instagram and go check him out. I'd tell you what it is, but I don't even know what it is. I think it might be Scott underscore trench. Are you sure about that? Should we look it up? I'm looking me stalling for time as I pull it up. I'm going to look at right now. T-R-E-N-C-H.

You're right. Scott underscore Trench. Go follow him. He's got 357 followers. I want to see a thousand on there by next week. And you can see a picture of his black eye, which is pretty fun. So, all right. I'm like a 13-year-old girl when it comes to Instagram. I love it. So all right. Awesome. See later. Thank you. Adios. You're listening to Bigger Pockets Radio. Simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the hype, you're in the right place. Be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online.

It's time for it. It's time for it's time. The random six. All right. Now, before we let Todd go officially, we have one more little section of the show here. We want to throw in at the end here, which we lovingly call our random six. So these are six random questions just to get to. know you a little better, Todd. Number one, what's the title of your future memoir? What? What kind of question is that? You're going to write a memoir someday. And what's going to be that title? Every day is Saturday. Oh, I like it. There you go. That's pretty good.

That's pretty good. That's good. Man, I'm going to, yeah, we got to steal that, use that. All right. How long before your flight takes off? Do you arrive at the airport? Well, if it's, if my wife is involved or if it's just me, if it's just me about, about 35 to 45 minutes. All right. Depending on which airport I'm going into. All right.

It's a close according to my dad. If it's with my wife, we got to follow the rules. It's got to be two hours. If it's a, you know, in, in the country, what is it, whatever it's called? Or if it's out of the country. then it's got to be three hours. It's international. So you got to follow the rules with my wife.

Follow the rules. Yep. All right. Have you ever met one of your heroes? No. I don't know what I really have any. Wait, you're talking to Scott Trench right now. So clearly you've met one of your heroes.

Come on. Yeah, true, true, true. Just today. No, I don't really have heroes, I guess. When I was a kid, I thought Superman was pretty cool, but I haven't met him yet. I thought Luke Skywalker was awesome too. I didn't meet him.

No, I haven't met anybody amazing. I would love to meet, I guess, some really successful real estate investor. I'd love to meet Ken McElroy. He'd be a great guy, I think, would be fun to meet. But I wouldn't necessarily call him a hero. I'd call somebody I would want to, Sam Zell, again, another guy. But I wouldn't call them heroes.

All right. It's all right. I like it. All right. What do you most grateful for right now in this particular moment? My family. I got two kids that are fantastic, eight-year-old and four-year-old, and my beautiful wife. So definitely thankful and grateful every day for them. So they're at a fun time. My daughter just came home yesterday and she got elected to the student council. Cool.

She ran the mile on Friday and got second place. She beat all the all the, all the boys except one. That's awesome. All the girls. So yeah. Fun times. I love it. All right. So on that note then, how old did you say your daughter was? Eight years old. So she's in third grade. Okay. Well, sort of on that note. If you can sit down with your 15 year old self to not a child, but 15 year old self, what would you tell yourself? I think I would tell myself to, I don't know. You know, life is good. So it's hard to say let's make some changes. But I I would probably tell myself to get more involved in leadership activities and get more involved in volunteering opportunities.

And then to be more, not necessarily just social, but social with a purpose, you know, making friends with the right types of people and being involved in those types of situations, I guess. So be more involved in being more involved in being more. of a leadership person, which is what I'm trying to get my daughter to be. And that's why I was excited when she got the student council because I didn't do anything like that. I never did. I was just kind of the kid in the in the corner, you know, not necessarily that, but I just wasn't one to be, you know, in front of everybody.

Perfect. All right. What was your last question here? What was your very first job? I was a, worked at Bobbers Boat and Bate. That's such a Minnesota name. That's awesome. So we were, I was a doc boy. So I helped bring the boats in.

He rented old boats. I helped bring those in and I sold, you know, help cashier selling candy and stuff and worms and things like that. So that was my very first job. It sounds like you tackled the work with two years. Wow, that was amazing. That was pretty good, Scott. Can you say that one again?

You can record it. Listen. By the way, that was like, that, not only is that like the most Minnesota concept, but I think the most Minnesota name, like Bobbers, Bobbers, Boat and Bat was it? Bobbers, Boobbers Boat and Bate. I'm going to go to Minnesota, Minnesota State Fair and go get some bait from the Bobbers' boat and bait. Used to ride, it was a three-mile bike trip. I ride my bike there almost every day I'd work.

That's awesome. That's awesome. All right. Well, thank you, Todd. Yeah. Thanks, guys. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing on YouTube, Apple, Spotify, or any other podcast platform.

Our new episodes come out Monday, Wednesday, and Friday. I'm the host and executive producer of the show, Dave Meyer. The show is produced by Ian K. Copywriting is by Calico content. And editing is by Exodus Media. If you'd like to learn more about real estate investing or to sign up for our free newsletter, please visit www.w.com. The content of this podcast is for informational purposes only. All host and participant opinions are their own. Investment in any asset, real estate included, involves risk. So use your best judgment and consult with qualified advisors before investing.

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