BiggerPockets Real Estate Podcast - 272: No Money, No Deals, No Time? Overcoming Real Estate’s “Big Three” with Brandon Turner & David Greene

Episode Date: March 29, 2018

Struggling to build your real estate empire? Not after this show! It’s time to put the no money, no deals, and no time excuses to rest. This episode is 90 minutes of pure fire, as Brandon and David systematically help you overcome the “big three” roadblocks most real estate investors encounter. You’ll learn how to fund your next deal no matter how much cash you have (or don’t have). You’ll find that deals are out there — if you are willing to follow the tactics and processes laid out here. You’ll also learn how anyone can invest in real estate — even if you have only a few minutes a day. Today’s episode is unlike anything you’ve heard before, so grab a pen and a notebook and prepare to annihilate your “big three!” In This Episode We Cover: Having more options through continued education Why finding better deals comes first before finding money Ways to do deals with no money down Private-money and hard-money lenders The BRRRR strategy Seller financing: how it works Finding deals Understanding how properties are valued Having the right process in finding deals The L.A.P.S. funnel Ways to “fill” the funnel Getting a real estate agent Direct mail, driving for dollars, and many more strategies Finding time to invest in real estate The 1 percent rule Finding the right people And SO much more! Links from the Show BiggerPockets Forums BiggerPockets Podcast 252: House Hacking (Your First Deal) & Life Hacking with Craig Curelop BiggerPockets Twitter Profile BiggerPockets Podcast 044: Creating Systems to Flip Houses While Still Employed with Michael Woodward Zillow BiggerPockets Marketplace BiggerPockets Calculators Investor Carrot LeadPropeller Wix How to Build a Website with Wix BiggerPockets Podcast 217: How to Work Less and Earn More Using the 80/20 Rule with Perry Marshall BiggerPockets Podcast 268: Acquiring 20 Long-Distance Rental Homes (on a Military Salary!) with Rich Carey BiggerPockets Webinars Books Mentioned in this Show Set for Life by Scott Trench Long-Distance Real Estate Investing by David Greene Finding and Funding Great Deals by Anson Young Investing with Low or No Money Down by Brandon Turner The Millionaire Real Estate Agent by Gary Keller The Compound Effect by Darren Hardy 12 Week Year by Brian Moran 80/20 Sales and Marketing by Perry Marshall The ONE Thing by Gary Keller & Jay Papasan Tweetable Topics: “The more you learn about real estate, the more options you have.”(Tweet This!) “You’re doing the lender a favor by giving them a way better return with their money.” (Tweet This!) “Good deals are not found, good deals are made.” (Tweet This!) “The process is more important than the specific tactic.” (Tweet This!) “At the end of the day, consistency is what matters.” (Tweet This!) “Real estate is market specific.” (Tweet This!) Connect with Brandon Brandon’s BiggerPockets Profile Brandon’s Instagram Brandon’s Twitter Profile Connect with David David’s BiggerPockets Profile David’s Instagram Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 272. If you're really worried about not having money that people have used before to find success in the past when they didn't have money, you're not the first person with this problem. You're not even the millionth person with this problem. There are tons of people who have been here before. Books have been written, articles have been written, podcasts have been recorded. Tons of work has been done for how people got started. Just keep in mind when you're done listening to this. Find that first deal and that should supply you money for your second.

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, everyone?

This is David Green, today's host of the Bigger Pockets podcast, and I'm here with my co-host, Mr. Brandon Turner. What makes you think you can be the host today? That's weird. I have bigger, stronger hands than you and I can just take the microphone away. That is completely true. All right, guys, so this is Brandon and David here.

We're actually doing a special show today just for all of you that is a little different than normal. We're not doing an interview. We've actually done maybe half a dozen of these since the beginning of the podcast because sometimes we just hear certain issues that are coming up over and over and over and over with investors. We just want to touch on them today.

In fact, today we're covering the big three. I got no deals. I got no money. And I got no time. And so we wanted to just spend a good chunk of time. I don't know, I mean, hourish, whatever, going through that. Before we do, we got a few house cleaning things to do. So let's get to that first.

Number one, today is we got to get today's, uh, quick tip. All right. Today's quick tip is very simple. If you have not yet introduced yourself in the bigger pockets forums, we actually have a forum for that for people to introduce themselves. It's such a good idea to do, right? Is get out there and meet people and say, hey, my name's John,

unless your name's not John. And then say, hey, my name's, Bill or Sally, and I am looking to do whatever in wherever, right? By doing those things, people will jump in, they'll get keyword alerts, and they'll go in there and meet you, talk to you, you never know what kind of relationships you can do. So head over there, biggerpockets.com slash new member. I know we say this one a lot of times, but it's so important. So do that today. Here's why savvy real estate investors are obsessed with bonus depreciation. It lets you take that rental property or commercial building you own and depreciate.

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I am. Born ready, Brandon. You tell me where you want to go first. All right. So let's just dive right into this. So we're going to cover, like we said earlier, the big three today, which are no money, no deals and no time. And I think we should hit it in that order because that's generally the order in which people struggle the most, right? The biggest problem people have today, I hear it over and over and over, and over, especially with new investors that they don't feel like they have enough money to get involved. And so what we're going to do is actually going to go through kind of a, I think we'll go through a philosophy of how to think about not having money. And then we'll actually go through some

tactics, actual things you can do starting today to invest in real estate even if you don't have a lot of cash. That's not good? All right, good. I didn't give you a choice, everybody. So, why we start with that philosophy? So the thing I like to stress about no money, I would say I wrote a book on creative finance. And the thing I talk about in there is that creative finance is often like a toolbox. There is no one way to do it. The more tools you have, though, the more projects you can take on. So all you have is a hammer, you can hit somebody in the head with it or you can pound it in a nail, but you can't build the house. But the more tools you do have, the more you can take on. So I actually recommend getting a good broad overview of a lot of different strategies because then

when a deal comes into your view into your targets, you can figure out where best to fit it. How can you best take that deal down? So I definitely recommend that. Yeah, I think that that's an amazing point that Brandon made, comparing the more you know about real estate, the more tools you have in your toolbox or on your tool belt, the more opportunities that you're going to have to take down a deal. So we're going to talk about some of the common ways of people that are dealing with no money or no deals or no time can kind of overcome those hurdles. When it comes to the solution that you're going to use, though, you can only use what you already know. If you don't understand how seller financing works, you can't propose it to the seller

in a way that makes sense of them to where they're seeing a win. If you don't know how to explain to somebody that has the money that you don't have, hey, this is a great deal. You're going to get an amazing return in it. It's a really safe bet. You're not going to be able to use private money, okay? So the more that you learn about how real estate works, the more options you'll have, the more options you have, the more powerful you're going to be. And that's what this is all about. We want to be able to take down every single deal that comes our way. You can only do that when you understand a lot about real estate and the options that you have

available to you. Nice. All right. So the second thing on the kind of philosophical side of creative finance is this. The better deal you have, the easier the financing is. Let me prove that to you. If I were to sell you my house, my house is worth, let's say, three quarters of a million dollars, right?

$300 and some thousand dollars. If I were to sell you my house right now for $10,000 and you had two weeks to figure out how to come up with 10 grand to buy my house, but you had nothing, no money at all. What would you do? My guess is, even in that one second of silence, right, you're already starting your brains working. Like, well, maybe I'd borrow it from a parent or maybe I'd partner with you on it or maybe I'd partner with somebody else on. Like that exactly the point, right? Now, you're not going to find a $300,000 house for $10,000, right? But the point is, the better deal you get, the easier the financing becomes. So, like, while we are going to talk a lot about here about no money strategies and low money

strategies, remember that the deal matters more. And so that's where we're going to go after that. So why don't we just run through kind of a list of different things that both David and I have done in our investing to be able to acquire real estate deals. And actually, before we do that, maybe people don't know who you are, David. I know you've been on the show a few times, but can you give like a 30 second explanation of who you are in your investing strategies? You got it. My name is David Green. I've been a police officer officer. And that's enough. So we're going to go on. It's been about nine years. I've been a police officer. I started buying rental property with my own money, and then I was buying about two, maybe three deals a

year and kind of slowly building up my passive income. Well, I got to the point where I learned how to burr, and I started buying two to three deals a month. And I really saw, Burr is an acronym that stands for buy rehab, rent, refinance, repeat. It is the order in which you are purchasing and financing your properties. It's the most efficient way to do it. I'm sure we'll talk about that more today. But my career really took off as far as my success with real estate. And what I found is that when I learned more about real estate, I started making better, more efficient decisions and my wealth started to grow a supercharge rate. Now I'm passionate about sharing that with other people. So now I work as a real estate agent in order of California. I share the stuff that I've

learned about real estate investing with my clients. And I'm just kind of like totally jumped all in on this real estate thing. I'm a big fan of bigger pockets because I know the bigger pockets is what helped make me to be like at the successful level that I'm kind of operating at now. I wouldn't have done it without it. And I want all you guys to be able to do the very same thing I did because if a dumb blue collar cop can do this, all of you guys can do it too. Well, I don't know if dumb is the right word. we'll go with it. We're going to go through the list now of ways that we've done our deals using little to no money down. In fact, I mean, I didn't have any money the first like seven years of investing. I built, like I achieved financial freedom through real estate, like was able to quit my job

without ever putting money into deals. So like I want to kind of walk you guys through some of those strategies. And the first thing that I did, so I'll give you guys a quick story of how I did it. So I had a triplex that came up on the market in my area. Amazing deal for those triplex. I really wanted it. And there was one, two small problems. The first one is I had no money. I mean, like a thousand bucks to my name, maybe. And the second problem was I had no job because I just quit it to go flip houses, which I hadn't really flipped any yet. So like, I had no ability to get a mortgage, none, right? So what most people do is they go, well, guess they can't do it and they walk away. But the deal was so good. And that's why I was telling you guys earlier, the good deals, you figure it out.

So I actually went and I was talking with some friends of mine who knew that they loved real estate. Like they liked the idea of buying real estate. But listen, they were, you know, your quintessential bankers best friend. They had full-time jobs. Both of them worked for the government, made really good income, made, had amazing credit scores, low income, low debt. They had their house paid out. I mean, they were perfect borrowers, right? But they didn't have the hustle or the time needed to go in and put all the work into a deal. And so instead, what we did was just partnered together in talking with them. I said, hey, would you guys ever be interested? Or I think I even approached it this way. Do you know anybody who would be interested in this? That's how I always approach asking people

for like lending. I said, do you know anybody? Because then it makes it not so awkward, right? for somebody you know, am not asking them for money. I'm asking them if they know anybody that would want to be in on this opportunity. And that's another mindset shift right there. I'm not asking for money. I'm asking for people to join my opportunity. They said, sure, we actually think that would be a very fascinating thing. So I said, okay, great.

So what they did is they actually, because they had their house paid off, they used a line of credit on their house to cover the down payment. So they didn't even put any money in the deal. They got a line of credit on their house to cover the small down payment. And then we went to a bank and we got the mortgage in their name. Not all banks will do this, but this was a small local community bank. The mortgage is in their name, but both of us are on title. Now, even if they, we could have probably both put us on title as long as they were

were strong enough to cover, which they were. But at the time, we just all thought it would be better that way. Anyway, regardless, at the end of the day, I put no money of mine into the deal. Technically, they put no money of theirs into the deal because it was a line of credit. We bought the deal. And every year, this is why I love about the stories, every single year, we go once a year to this Mexican restaurant in my town, which is the, I don't know, it's like the best restaurant in my town or second best. And shout out to savory fair as being the best. But we go to this

Mexican restaurant. We sit down. We eat an amazing dinner. And then I show them all the books. And I show them, here's all the income that came in. Here's the expenses. Like, that's really all that they care about. Right. And then we figure out how much profit we made over the last 12 months. We each write ourselves a check for an entire year of the profit. And every year I walk out of that meal with like $5,000 extra. It's fantastic. I just love that. It's like free money. Every year I just get like five grand. And they actually use that money oftentimes for a cruise. They going to cruise every year and they just use that money. So again, it's like taking an asset with no money, figuring out a couple creative options in there and then getting a better life because of it.

So again, that's just, that's kind of a partnership, how I did that. There's actually a few different strategies incorporated in there, but primarily, like, I used a partnership because I didn't know what to do. So I don't know if you've used partnerships, do you want to go on to the next one or two and pick some else? Yeah, I think the point that I want to make about partnerships is that like when you're building a house, not everyone does everything. There's a roof guy. There's a contractor guy, there's an electrical guy, there's a plumbing guy, there's a floor guy. They all kind of specialize in what they do. And a lot of new real estate investors think that they got to learn how to build an entire house from the ground up. They have to know all the

framing and all the painting and everything. And you really don't. If you're really good at doing your thing, there are people out there that know how to do their thing. And when you put everyone together, that's how you build a house. Okay. So if you know you're really good at analyzing deals, get really good at analyzing deals and find people that are not really good at analyzing deals, but they're good at raising money. Or there may be like that gadfly that you can just talk to anybody and they can find people that might want to raise money for you for the deal or contribute to the deal. Or maybe you find a contractor who's really, really good at fixing stuff and he'll go in there

and do it for free to make the deal work, okay? There's always somebody who has a skill that you can be partnering with to fill in a gap that you don't have. That's the best point of partnerships. Now, the thing that I would say for people who don't want to partner with somebody is consider house hacking. Now, most investors know I need to put 20 to 25% down to find buying. an investment property because that's what most banks demand. However, you can buy a two, three,

or four unit property that will still qualify as a primary residence that you can use a primary residence loan to get. And sometimes those can be as little as three and a half, three point five percent down or even less. I know of in my area some government grants where we're actually getting the government to give you five percent towards your down payment. So you don't have to pay anything, okay? If you bought a fourplex that way, run it out three of the units and lived in one yourself. You could have yourself your very first investment property that would most likely cash floor, at least be breaking even, without having to put a lot of your money down, then you create equity through that property and boom, you got money for the next deal.

So that's actually how I started my very first, like, rental property. I had one live in flip, but my first rental property was a duplex. I lived in one half, rented the other half out. It wasn't an FHA loan, but it was basically the same thing. It was like a whatever. Back there was 2008, so they had a bunch of weird loans. But anyway, I bought this thing, lived in one unit. And then my mortgage payment was like $6.20 a month or $6.30, somewhere like that.

And the tenant came over and paid me rent a $6.50 once I got it rented out. And I was like, this is amazing. Like, that's how I discovered the power of rental properties. So that means I didn't have to spend all of my income going towards my mortgage payment, which most people do. They spend the biggest chunk of their money is either taxes or going towards that. So that was a, gave me the ability to actually stop working. That's when I quit my job and started flipping houses. And that was led to the triplex I told you guys about earlier.

So house tagging, very powerful. I know other guys do it as well. Like Scott Trench who wrote the book, Except for Life. Craig Curlop, who has been on the Bigger Pockets podcast. He's a Bigger Pockets financial analyst, I think. He does it. And others. Like, I mean, it's such, in fact, I was going through, I'm putting together a future

book for Bigger Pockets. This is the first hint at it, but it's coming out here this fall at Josh Dorkin and I are writing. And in the book is like a bunch of stories of our podcast guests and some really legit good real estate investors. And as I'm putting these stories together and compiling them and writing these stories, I realize a pattern. It was over and over and over and over of how many.

many successful investors started with house hacking. You don't need to, but it's such a good way to build that foundation. So yeah, great house hacking. Awesome. All right. Next up is private money. Now, private money is a fancy way of saying somebody else's cash, okay? We're living in an era right now where interest rates are ridiculously low. Now, that's good for spurring the economy. It's terrible for anyone who's trying to make any kind of interest off of their money. So if you find somebody, and they're out there, trust me, that has a lot of cash sitting in the bank, it's not doing anything. you can offer them the opportunity. Look, I found this great deal. We'll use your money, we'll use my deal and my time and my expertise. We'll partner together on the deal. However, you decide that you want to

offer it to them. And that's how you're going to put the deal together. Now, get out of the mindset of thinking that they're doing you a favor by giving you their money. You're doing them a favor by getting them a way better return than they would have got on the bank. And like Brandon said earlier, the better your deal is, the more likely they're going to be to jump in and want to do this with you. So if you find a deal, finding the money is going to be much, much easier. That's just a matter of We're going to talk later on in this podcast about the lapse funnel. And it's a really cool way that Brandon has come up to make sure you're successful at pretty much anything you do.

But if you get out there and you tell enough people, I'm looking for someone who wants to earn a really good return on their money. Somebody knows somebody that has that money that you can use for your deal. That's all good. Yeah. And again, just to harp on that one more point, one more time. I mentioned it twice already. Like I mentioned, Dave mentioned it like, you are not begging for money.

You have to get out of that mindset. If you find good deals, you are offering something amazing. What's funny is when I tell that story I told a minute ago about the partner, with the Triplex. I tell that story and I always get one of two react. Okay, one of three reactions. The first reaction people say, well, that was great. Good job, Brandon. Right. But a lot of times I get one of two completely opposite reactions. Some people say, well, why would that partner ever do that? They could just go do it themselves. You're just ripping them off, Brandon. The other people say, why would you give your partners half a deal for not bringing anything other than money to the deal?

That's crazy, Brandon. They're ripping you off. And isn't that funny how like they're completely two different opposing thoughts, yet like, it's just because like, where do you value, like, what do you value the deal and the, and the hustle and the knowledge and all that? Like, where does that fit in? And again, I value that very highly. Today, I probably wouldn't give somebody half just for giving me a down payment. In fact, I wouldn't, right? Like, I'd figure out another way because that's, like, very expensive money.

In fact, I'd probably aim for like hard money over that because I'm not giving 50% away. So speaking of hard money, you want to go there? Yeah. So let's say that you find this great deal and you offer it to someone and you say, hey, and you can come in on this, you'll finance it, and I'll do all the work, and they say, I want half. And you say, there's no way I'm giving you half, right? You can go find a hard money lender, which is basically just a lender who is lending money against a hard asset, which in this case would be real estate. And where I'm located, you're typically finding somewhere between

9 and 12 percent to use your money and somewhere between two and four points. Now, that is expensive, but it is usually much less expensive than 50 percent of the deal if that's what somebody wants. What's a point? A point would be 1% of the loan value. So if you're looking to borrow $100,000 from a hard money lender, a point would be $1,000. So if they want two and a half points, that would be $2,500, right? Now, that's because they're making a riskier loan to you because they're loaning against a property that's usually in bad condition and their money isn't secured by anything other than that asset.

So it's a little more expensive, but it's often way less expensive than half of the deal, okay? So hard money is another way that you can find people who they don't make money unless they loan money. They need you. You're a lead to them and they're trying to find people like you to let you borrow money to buy a deal. and if the deal is good enough, it will absolutely pay for the points in the higher interest rate that you're having to use to get the hard money. Hard money is definitely better than no money.

And if your deal is good enough, it'll work. Now, another strategy we can talk about is the Burr strategy. Burr is an acronym that stands for buy, rehab, rent, refinance, repeat. Okay. Now, all of those things when you're buying a rental property are being done in some point. Typically, when you're buying the property, you're financing it as you buy and they're kind of in the same step. Well, with Burr, you're not going to finance it until after you fixed it up, right? So a typical deal for me where I'm going to burst something would look like I buy a property that would normally be worth $120,000, but I get it for $60,000 because it's in such bad shape and this person really needs to sell it, okay?

Then I spend about $30,000 to fix it up because it needs a lot of work. But maybe I get $45,000 to $50,000 worth of that rehab because my contractor is better than everybody else's contractor because I've spent a lot of time finding the best ones, okay? So I've spent $90,000 on this house that's going to be worth $120,000. We call that the ARV, the after repair value. It's now worth $120,000. The bank's going to come in there, going to say, Hey, David, I see that you just bought this house for $120,000 and you want a loan. I'm going to let you borrow somewhere between 70 and 80% usually of whatever that after repair value is,

which would be what the appraiser comes back and says it's worth. So when he comes back and he says it's worth $120,000, they're going to let me borrow anywhere between $70,000 and $85,000 on that. Now, I'm not sure about the math. I had to just do it in my head. Maybe it would be closer to $90,000 to $84,000. So whatever 80% of 120 is is 96,000? There you go.

So somewhere between 84 to 96,000, right? Now, in this hypothetical example, I only spent $90,000 on this house, okay? So the bank's going to come back. If they let me borrow on the low end, 84, I'm leaving $6,000 in the deal. And if they let me borrow on the high end, I'm getting $96,000. That's $6,000 more than what I put in, okay? So I walk away with basically no money left in that deal on average because I added so much value through buying the property correctly and doing a very good rehab.

That's the way that Burr rewards you for doing a really good job with your investing, and you end up getting all your money back and then you can go invest in the next thing and you don't have to worry but not having money. Now, you need money up front to be able to do this, but it could come from hard money. It can come from private money. It can come from creative financing. There's all kinds of things that you can do to actually get that money. The point is you're getting it back so you can pay those people back without having a really high interest rate. And now, boom, you've got a property that you finance at a low interest rate is very profitable. I personally think way more investors should be doing this, learning how to buy. Burr is going to absolutely supercharge the amount of success that you have in real estate.

And understanding that I'm not leaving any of my money in this deal is a really powerful incentive to do a really good job. There you go. Yeah, I love the Burr strategy. I do it all the time. In fact, I talk a lot about on the show the fourplex that I bought for my daughter, Rosie, the week she was born. If you've never heard that, let me tell you a quick story. So the week Rosie was born, I bought a fourplex. I used direct mail marketing to get it. I bought the fourplex for super cheap. The guy wanted 90,000, but it was a disaster. I mean, just a complete pit needed a complete gut job. Every unit, pretty much you need to be remodeled. And it's actually four separate houses, but I really liked it a lot. So he on a 90,

I said there's no possible way I can do that. I could pay like 40. And he basically hung up the phone. A month later, came back and said, okay, can you go a little more 45? And I said, okay, I can do 45. And so I bought it. I ended up putting $120,000 of work into this. So it needed a massive rehab. And I went over budget on this thing. But at the end of the day, now we have a $160,000 total into it. It's worth somewhere between $220 and $240 right now. So I've got all this equity in it. So then I went to a bank and I refinanced it. Now, my plan was to refinance 80% of it. But the bank, when I went through it, they said that would be just fine.

Even the 70 to 80%, that's fine. At the end of the day, they stopped me and they only let me do like 110. I think my loans for 110. So I got a little bit of money left in the deal. If I want to go back now and refinance it again, which I might at some point, I could, but at this point I didn't. But either way, I didn't get all my money out, but I still got this thing done. Now it's on a 30-year, well, I shouldn't say that.

It's on a 30-year mortgage, but I set up payments so it's paid off in 17 years. So why did I do that? Why did I set up this path in 17 years? Because in 17 years, Rosie Lou is going to be going off to college. That should be worth by that point. 17 years from now, 220, 240, should be worth hopefully 350 somewhere in there, you know, conservatively. So, you know, she'll have a third of a million dollars to use for college or to use for her own real estate down payments or to use for whatever. But basically, I was able to help my daughter not be strapped by hundreds of thousands of dollars of student loan debt because of a real estate deal that I made today. And I mean, anybody can actually, I know we're not really talking about no money here, but I just love that strategy because any parent, if you have a kid under the age of like five right now or six or seven, all you need to do is buy one property that breaks even.

Like, I'm not saying break even. But like, if all you did was bought a property that broke even on a 15 year mortgage, you can pay that thing off over the next 15 years and that's your kids college. And you get to use that as a case study to show your kids how wealth and financial freedom works in the real world. So anyway, this is a side note there. I think that's just kind of one of my coolest things, strategies for real estate. Brendan, let me ask you, how much equity is in that house right now? So counting what I put into it or from the actual loan right now. So if I have 160 and it's worth 220, that, you know, let's say conservatively it's worth

220 and I have 160 grand of equity. But I only owe 110 and it's worth to, what did I say, $220? So what's that $110,000 in equity? So you've got $110,000 of equity in this property. If you wanted to buy another property, and this wasn't Rosie's property. It was just a regular person. Would you have any problem with $110,000 in equity in that house

that you could tap into through an equity line of credit or a business line of credit or anything else? Yeah, I definitely could. In fact, right now, I could even go to a bank or even a private lender and I can say, hey, look, this is worth $220, you know, minimum. It's kind of a weird property to estimate, which is why it's hard to know exactly what it's worth.

But you know, say it's worth $220, I only owe $110, hey, can I borrow a $60,000 line of credit on it? And most banks will say, in fact, I don't know why I never actually thought of doing that. I should actually just go do that. I can get a line of credit. This is awesome. This is like live helping from David Green here. If I go to a local community bank and say, hey, can I get a second mortgage on this rental property? There are some that will do that. Not a lot, but some. And then I have more cash to go and do another deal.

And so I could tap in equity if I want to, but I also just really like the idea of paying that off before college. So the point here is you really only need to get one really good deal. And that should provide you money for your next deal, which should provide you money for your next deal. And as long as you're buying right every time in adding value to your properties, you'll only struggle with not having money for your very first. deal. Okay. So do everything you can to get that first deal and do a really good job with it. And then boom, that problem is going to be solved for you. Okay. In order to get that first deal, another way that you can look into doing this is with seller financing. Okay. Now, really quickly, seller financing is basically just, I'm going to buy your house, but I'm not going to give you the cash for it that I got from a bank. You're going to hold the note and I'm going to make a payment to you instead of a payment to the bank all

the time. Now, you may be thinking people don't care about that, but they really do. There's people out there that would totally carry the note for you because they're probably going to get a better deal themselves as far as how much the purchase price of the house is. So one of the options that all do is I'll say, hey, I want to buy your house. They'll say, I want 100 grand. And I'll say, well, I can give you 65 and they'll say, no way I need 100. And I'll say, okay, I'll tell you what. I can give you 65 if I pay a cash. I can give you $85 if you fund half of the deal. And I can give you your 100 if you fund the entire thing is zero percent interest, okay? I give them options so that they don't feel like they're taking advantage of they can choose. And if they really want that 100 grand and they're willing to

finance the entire note, as long as I calculate it and make sure that it cash flows, that's a win win for me because I'm putting no money into this deal. The rent's going to be going up every single year. I'm making money right out the gate. He's happy because he got to feel like he got more for his house and he still has some passive income coming in. We all win. So don't neglect to tell people this is something that I can do for you if you're not having any money, right? There's tons of creative things like that that you should be spending your time learning if you're really worried about not having money that people have used before to find success in the past when they didn't have money. You're not the first person with this problem. You're not even the millionth person with this problem.

There are tons of people who have been here before. Books have been written, articles have been written, podcasts have been recorded. Tons of work has been done for how people got started. Just keep in mind when you're done listening to this. Find that first deal, and that should supply you money for your second. Yeah, I love that. And in fact, the mobile home park that I just closed on here a couple months ago, I bought my first mobile home park.

The seller actually carried the contract on that. Most of it, I think we put down, I think at the end of the day, we ended up putting down around 10%. It was supposed to be 20, but we, anyway, we had some good negotiation in there. I think what we had, five percent interest for a 25 year note on it with no balloon payment. Like, that was from a seller. And people say, well, why would he hold, why would this guy take a 5% interest on it when he was just getting all the cash flow before?

It's because now this guy who was like, I think he was in his 70s, maybe even late 60s, early 70s. Anyway, he's now like able to just get a check every single month. We're going to mail him a check. And he sold the people he knew. He's actually a bigger pockets member. So he knew me and the partners, Ryan and Mindy. And he could trust that we, We were just going to give him steady income for the rest of his life. He'll never again have to worry about that park. We have to worry about phone calls. We want to worry about tax stuff.

Like, we are now the owners of that park. He just makes money every month. So seller financing in a very cool way to finance your deal. My last 24 unit apartment complex also was seller financing. So you never know if you don't ask, right? It doesn't hurt to ask somebody, hey, can you carry the contract on it? All right. So then the last point I hear about money that I just want to cover real quickly is that this idea of

it doesn't have to be one of these. You heard example after example here. but like creative finance is about finding a combination of things. It's about asking how do I get this done, not like, you know, will I get this done? It's not a yes or no question, right? I think rich dad, poor dad talks about that, you know, Robert Kiyosaki says, you know, the rich, poor people say I can't afford it. Rich people ask, how do I afford it, right?

So like the way that I figured out most of these creative strategies was not reading a book. I mean, yes, you should read books. But I didn't, like, nobody told me in order to finance my 24 unit, I would have to do a combination of a triple net lease option, combine that with a home equity line of credit, combine it with the partnership, combine it with seller financing, and then burr the thing. Nobody told me that that's what I would have to do to get that done. And most of you have no idea what even I just said, right? But like, that's how I did it.

You know when I figured that out at about four in the morning trying to just trying to figure it out, asking that question over and over, how do I get this done? That's how you get these deals done. It's usually a combination of things. So if you have no money, you got to hustle, you got to figure this stuff out and continue to ask, how do I get it done? That is so good, Brandon. And I think you just are a perfect example of you had a lot of things in your tool belt.

You used all of them. You used the hammer for this, the crowbar for this, the screwdriver for this, the nail gun for this. You put everything together to be able to build that thing you needed to build. And your reward was you made a bunch of money because you knew how to do this stuff, right? And that's just a matter of educating yourself and knowing what options that you have available and not having a quitter's attitude where you say, I don't have any money, I can't do this. Screw that. There's people that have done it with no money.

you can do it with no money to listen to this again if that's what you need to do write these things down understand all the concepts we're talking about and study them until you can recite them to someone else that's when you know you really know it and don't let no money down hold you back now the next thing that we find that people fall into is uh this quitter attitude because of no deals they say well there isn't any deals anymore right now my opinion is the reason people do this is because they got used to 2010 when every single house was for sale and you would just like it was like hitting water falling out of a boat there was tons of deals everywhere, right? It wasn't hard to do.

Did you make that up? Yeah. That's funny. That's a good analogy. Well, now you got to look for water a little bit more, right? Or you got to make your own. Okay, and that's what we're going to talk about today. There's lots of things you can do.

If you take the same attitude that you had with the no money thing and you're like, I'm going to figure out a way to do this and you apply it to making a deal, you can do the very same thing where you can find a deal where it didn't appear that there was a deal before. That's how I'm getting like 80 to 90% of the properties that I'm buying. I am making it make sense for me. Now, the point is, you don't have to have like one specific tactic that's magic. And if I just do this, I'll be completely successful, right?

You have to pick something that you think is going to work, something that you feel comfortable pursuing, and just go and go and go and go until you master that thing and eventually it will pay off. There are tons of ways people are finding deals. The process and sticking with it is more important than the specific tactic. If you want to lose weight, there's so many ways to do it, right? You could do sit-ups, you can do push-ups. You can go running. you can do crossfit.

There's a ton of different things, but I guarantee you, if you just picked any of them and you stuck with it long enough, you would get results, okay? Once you've mastered one of them, then worry about going on and finding the next thing,

but don't be the guy that is always chasing the newest thing and trying to find the quick and easy fix without having to work hard. Those people never find success, okay? So Brandon and I both believe that in this market, in most markets in the country,

good deals are not found, good deals are made, okay? There's several ways to make deals, and we're going to share with you guys some of the secrets. You guys should tweet that. You guys should tweet that. Good deals are not found. Good deals are made.

That's a great idea. Do they need to give credits of Beardy Brandon when they tweet it? Well, my Instagram is at Beardy Branden. My Twitter is at Bram. This is confusing. And you're at David Green 24. Yes. All right. We'll make it easier. At sign, like Instagram, Facebook, or Twitter, bigger pockets. At sign bigger pockets. But yeah, good deals are not found. Good deals are made. David Green. Okay. So we're going to talk with you about, that's exactly what I'm going to do. We're going to talk about some of the ways that we are making good deals where there was no good deal.

okay the very first one and the easiest one so that's where we're going to start is just buying a fixer upper property when i find people that say david i can't find a deal that makes sense and i say show me what you're looking at every single one of them is showing me primo properties that pictures show great that are pretty much already at market value and they're trying to force that square peg into the round hole of a good deal and they can't find a way to make it work and they're frustrated okay i'll tell you guys right now the majority of what i'm buying is distressed property that needs some work and nothing that i look at looks really good if agents send me a deal that you that has like good looking pictures,

I'm irritated with them for wasting my time. I don't want it, man. I want a house that smells like cat pee, that has walls in the wrong places, that looks like somebody started to fix it up and then ran out of money and just left it there and it's been rotting for the last year, right? That's like the perfect deal for me to be able to find

because I can add value through my rehab and I can make it worth a lot more money. Now, there's a lot of different ways that we're going to do that, but Brandon, have you had a similar experience? I mean, I suppose so. I mean, everything I've ever bought, Every single property I've ever purchased ever has been a fixer upper. So there hasn't been one, right?

I think, I can't remember who it was. I think it was Michael Woodward, who was on the podcast back like four years ago. And he had this line that I thought was just classic. He just said, like, when he walks into his house, he brings his two boys in the house with him, he's two young kids. And they take a big whiff and just smells like, you know, cat pee and everything. And he says, boys, what does that smell like? In unison, they go, money.

Yeah. Like, I just love that story because, like, that's what, like, I've known investors who are like, oh yeah, I went to that house. I walked in the front door and immediately turned around. And I'm like, good for you. That's why I'm successful. That's why, because I go in and I'm like, I like that. So anyway, fixture uppers, fantastic.

And that's a good way to make a deal happen. But there's other ways as well. One of my favorite tactics is to look for what I call hidden bedrooms, which means you're looking for opportunity to add square footage, add a bedroom, add a bathroom, whatever, where there isn't currently one. Most specifically, this is going to be a little bit market dependent, but I'll tell you what I look for.

I look for two-bedroom houses that I can turn into a three-bedroom house and they're actually quite prevalent. Like most agents don't know what they're doing. So like, those just list the house at a two-bedroom house and not realize that there's actually a third bedroom and right now there's just, you know,

some reason, no closet or they call it a rec room. But the number of bedrooms makes the biggest difference for me, at least for rental properties, but flipping as well. Like the difference in value between a two-bedroom and a three-bedroom in my area is huge.

That might be different in your area. I'm not saying it's a hard and fast rule everywhere, but in my area, between a two and a three is massively different. I hate renting two-bedroom houses out. I love renting three-bedroom houses out. So the way that I do that, I look for two-bedroom listings that have over a thousand square feet. If there's over a thousand square feet listed on the listing, and it's only two bedrooms, there's probably a hidden bedroom somewhere, right? There's probably like this massive wreck room or this big attic space that's just like empty. And so I will often

turn those into a third or even a fourth bedroom making the value is significantly higher. Again, I found, you know, like this hidden deal, but really I just made it because nobody else saw that. So anyway, anything on that? Yeah, the reason that this works is because Brandon and I understand the way that properties are valued. Okay, now multifamily properties are considered a business and they're valued based on how much money they're generating for the owner, how much profit, okay? Single family homes, and by single family, I mean anything 40 units or less, are valued based on what somebody else paid for it. So appraisers are assuming that even though we're investors,

they don't care, they don't know the difference. To them, how much is this house worth based on what another house is worth because that's what most people who are buying a house to live and care about, okay? A three-bedroom house is going to be worth noticeably more than a two-bedroom house because almost everyone in the modern-day family wants at least three bedrooms. A four will be worth more than a three, but not as much as a three more than a two. A five will be worth more than a four, but not quite as much. And eventually, once you get above five, it doesn't really matter. It's just a square footage in that area, right? Yeah, it's a weird house because you don't need that many bedrooms, okay? So because we understand that, we know how appraisers think, we put the property

in a condition that appraiser is going to care about more, right? Now, another thing that appraisers care about isn't just the number of bedrooms. It's also the number of bathrooms. Like, anything more than one bathroom helps you a lot. It's hard living in a one bathroom house. If you can add a second bathroom to a house or a third bathroom to a house that has two, you can increase its value quite a bit because now they're using comparables that are three twos instead of two ones or two twos, okay? That's why that works. There's lots of ways that I figured out through rehabs where I can add value to my home without spending a lot more money. Okay, we don't need to actually go spend 30 grand to add another wing onto a house. Oftentimes, there's parts of that project that are already

done for you and you just have to go fill in the completions. So I do a lot of investing in Florida. Now, in Florida, they have what they call Florida rooms. It's like a sunroom, okay? Or we have them in California that, oddly enough, they're called California rooms. It's basically just like a part of the house that is like an indoor slash outdoor living space. So it has a roof, it has electrical run to it, but it doesn't have four walls. Maybe it's missing. one wall so you're still feeling like you're in the backyard. In Florida, they put up these screens or these nets so the bugs can't come in there and bite you, right? The cool thing is the foundation, the roof, the drywall, the electrical, and sometimes plumbing are already run to

that area, but it's not included in the square footage of the house. Now, appraisers care about how many square feet the house is because what they generally do is they say the average price for square foot for this area is $100. I multiply that times how many square feet the house is, say it's a thousand square feet, boom, that's how they come up with the value of your house. then they adjust it based on how many bedrooms and bathrooms has next to the comparable properties. If I can add three or 400 square feet to my thousand square foot house, I'm making the price per square foot get multiplied by a lot more square feet, which means my house is going to be worth a lot more.

If I can do that for only $6,000 or $7,000 because most of that work is already done and all I have to do is run up some drywall and put in a ceiling fan and maybe build a closet, not only did I add three or 400 square feet of space, but I did it very cheaply. and I could add a bedroom or a bathroom or both to the home. And boom, I've just created my extra bedroom. I routinely do this for $6 to $7,000, okay? And I add $30,000 to $40,000 worth of value to the house because I don't have to build a whole wing onto a house. I'm taking space that's already there and I'm improving it. Now, that deal might not have looked like a great deal when it was a two bedroom one bathroom house. It was worth all the same as the other ones. But if I buy it and then I make it a three bedroom two bathroom house with extra square footage, now it's comparing to much more expensive properties. My value skyrockets and then when I go to refinance and I'm getting all my money or sometimes more of my money back out.

The lazy investor wants a house that someone else has already done the work. The pictures look great. It's already renting for the most that it can be. There's nothing to be done to improve it. And they want to try to make that work as their investment. The wise investor looks for ways to add value to his property or her property, get more money back out of the deal and grow their net worth slowly and systematically. Man, that was awesome. I love that example.

The sunroom or the California room. Very cool. All right. So I want to shift gears here a little bit. We're going to still talk about how to find deals. I know you guys are looking for some actionable tips, and I hope that was actionable for you. But right before I'm going to give you a whole list of different things that we do to find deals.

However, before I do, I want to explain a little bit about the process because, again, the process is more important than the specific tactic. That's true in almost anything, right? But in this case specifically, like, again, I could give you a couple tactics which we will, but if you don't run it through the right process, you're never going to get through it. This is what the process looks like, and I call it the lapse funnel, L, A P-S, and it stands for this. Leads, you have to get leads into your business. Then you have to analyze them, A, you have to analyze them. Then of all the ones you analyze, you need to make some offers,

or I call that pursuing a deal. You have to go after some of those deals that you analyzed. Because now you know how much to pay for, right? Because you analyze it. So you go after them, you pursue it. And then the final S on laps is success. Some of those are going to turn out. Here's a real life example. So I sent out 300 direct mail letters a year and a half ago when I was looking for almost two years ago now when I was looking for that property for my daughter who was soon to be born. So I sent out 300 letters out of them. I got back like 40 phone calls. That was a good ratio. I got a good number back because it was a very targeted audience that I mailed to. It was like absentee owners who'd own their property over five years with a certain number of equity.

I can't remember off top of my head. So anyway, so I sent this list 300, got back 40 phone calls. Some of them were tire kickers, whatever. But of them, there was about a dozen that were serious like contenders, right? So out of those 12, I analyzed those ones. Seriously, so L is leads. I got 300 cold leads, 40 hot leads, you could say. And then I had 12 deals that were like worthy of analyzing. I made offers on all 12. And then I got one of those eventually accepted, right? So now, is that guaranteed you send out 300 letters? You're going to get a deal? Of course not, right? But if you consistently work this lapse funnel, you're going to get deals. In fact, this is the exact process that every single solitary,

investor in the world does. Don't believe me. Like they might not know the word lapse funnel because I made that up because I like making up names for things like Burr and house hacking, but like they, they do it anyway. Like you can't buy a house without pursuing it, right? They don't fall into your lap. You can't really pursue a deal unless you know how much to pursue it for. You have to come up with some kind of price in your head. And then you can't really analyze deals if you don't have some kind of lead source, right? So my point is this. Every single person follows the lapse funnel. The investors that are like the best in the world, the ones that we've interviewed here on the podcast for years now, like I came up with this sort of like methodology after talking to almost 300 different

investors. The ones that are the high volume investors are the ones that are getting their goals accomplished are the ones that recognize the funnel. Again, they might not say laps, whatever, but the same thing. They know how many leads they're getting. They know how they're getting leads. So that's what we're going to focus on next. Anything you want to add to that before we move on to the actual tactics? Yeah, I just want to add that this is not unique to real estate investors. This is how every successful business person or salesperson is making money. So in my first year being a real estate agent, I was the number one in my office out of 100, right? I didn't know sales. I was a police officer. The reason I did so well is I already understood this principle that Brandon is talking about that I was

applying it to my real estate investing business. So it made sense to apply it to my real estate agent business, right? I had to go get a bunch of leads, which for me was people that I knew that would know people that wanted to sell a house. I had to talk to them and analyze, is this someone who's going to send me referrals or is this someone who doesn't, right? Maybe they don't even know anybody who lives in a house, so that's not a person that's worth pursuing. Then I had to pursue the people that I knew would be most likely to send me deals, and then I ended up having success, okay? You can apply this to anything that you're trying to accomplish, but why not apply it to real estate investing? Because that's what your goal is, and that's where I'm going to get the most bang for your buck.

Technically, I applied this to dating, right? So there's a lot, there were a lot of girls out there in college, right? And there was tons of leads out there. And then I analyzed some of them, and I found some that were, you know, fitting. And then I'll have to be careful here, because Heather will listen to this later. And then I, you know, I analyzed them. And then I pursued one of them. And then I got rejected. This is actually true story.

I got rejected from Heather the first time I asked her out. And then I got rejected from Heather the second time I asked her out. And then the fourth time I was basically like, this is true story. I was like, I can't be your friend. I have to just break this friendship off because like I need like, I like you. And she's like, fine, we'll go out. And somehow, so like for the first like month, I thought she would just be nice because I held that over her, which there's a lot of sales techniques built into that story,

but I'm not going to go into it now because we want to get to the actual tactic. So funnels are everywhere. People make fun of me because I put approach everything in life into a funnel. By people, he means me. Brandon turns everything into a funnel. Everything into a funnel. All right. So let's get into some ways to fill your funnel.

Number one, the MLS, which means the multiple listing service, which is basically like the back in the day, let me give you a quick, like people that don't know the actual story. And you can correct me if you know this any differently than what I've known it. But back in the day, everyone had lists that they were, like, facts around. Like, here's all the properties that are for sale. And my brokerage would send it over to your brokerage. And we compiled this big list of them. Well, then this thing called the internet came around and those lists went online.

But still, today, those lists are governed by a whole bunch of different groups called the different MLSs. There's like a MLS in the Northern Bay area. And there's an MLS in the Seattle area. And there's an MLS in like different. There's tons of, I think there's hundreds anyway. And so the MLS is when people say the MLS is, when people say the MLS is, we really mean the MLS assesses, but that would be weird to say. Okay, so there's the MLS, we'll just call it that.

And it's where all the real estate agents put their deals that are for sale. So other real estate agents can see it. To have perfect access to the MLS, you need one of two things. You need to either be a real estate agent or you need to have a real estate agent that's going to give you access to it. You know, like give you a way into it. Now there's a third way and that you all know about it, I'm sure. It's the portals. So imagine a portal like you're sitting outside a house and you're looking through the window.

So Zillow, Redfin, Trulia, Realtor.com, those are portals. They look into the MLSs and they have special arrangements work out with the various MLSs, but they're not perfect. If you want great MLS access in a certain area, you got to get a real estate agent. So if only there was a real estate agent here in this room who could help us figure out how to get a good real estate agent. Well, since we don't have a good real estate agent, I'll just have to jump in and do the job instead. Now, the key to finding a really good real estate agent is something I refer to as RKR. Rock stars, no rock stars. Okay. You don't want just any real estate agent. You want a really good

agent. And furthermore, you want a good agent that knows how to work with investors. They could be an amazing agent that's really good at working with families trying to find a house and they will be horrible for the purposes that you're serving, right? Remember our tool belt analogy, you don't want to hammer one which you really need to screwdriver. You need to go find the right agent to help you. Now, one of the questions that I'll ask agents when I tell them I'm an investor looking for property is, do you buy properties yourself, right? If you find an agent that does buy investment properties themselves. They already get everything you're trying to do, especially if they're good at it, right? And they're going to know people that you're going to need

for your team. In the book that I wrote for Bigger Pockets, Long Distance Realston investing, I talk about the core four. Those are the four people that you need to put on your team to help you invest successfully. If you find an agent that already knows those people, boom, in one step, you've kind of figured out that problem for yourself. Now, agents will send you deals. Keep in mind that you're looking at deals for how you can make it a good deal. You're not just looking for something that's already been made. So tell your agent, I'm looking for houses I can add square footage to. I'm looking for two bedroom, one bathroom houses. That's what I want to go see. Then when you notice when they send you the list that one of them has a thousand square feet,

that's the one that you click on and you start looking into and say, hey, where can I take a dining room and turn it into a bedroom or a den or whatever the case may be? Maybe it already has a bedroom and all I have to do is add a closet and it's an official bedroom, right? That's something that you can do for six or seven hundred bucks and add a lot of value to your house by doing it Right. Let your agent know this is what you're looking for. And then kind of gauge how are they responding? Do they seem really insure themselves? Like, this isn't something I do. That's the wrong agent. Keep moving on. If they get excited when you talk about this, then you know you found someone they can help you. Yeah. And I love that. And so to go back to the RKR, the rock stars, no rock stars is find a rock star in your life. Find a rock star in your life. I'm somebody who's awesome. I'm somebody who's not somebody who's like, hey, who's awesome. I'm somebody who's not going to be good. It's just like, hey, guy at work is an agent, right? But at least it gives you some leads that you can then analyze and then you can pursue one of

those agents and you'll find a good one, right? LAPS works and everything. All right. So, anyway, so finding a good real estate agent, they can actually help you find deals on the MLS, like David said. One thing I like to do is have your agent if they have the ability, which most do. I'm assuming, do you guys have the ability set up automatic email alerts? Absolutely.

Okay, yeah. So I can get an email set up so that anytime a two-bedroom house comes on the market in my in my area or any house under $200,000, I'll get an email because I want to be notified very, very quickly. So I'm going to work with my agent to get the right email alerts set up. That's a very quick, actionable tip you can do today. Like, don't go to bed until that's done. So anyway, get a real estate agent. Okay, next up is going to be the wholesaler, right?

Wholesalers are people whose job it is to find a deal, put it under contract, and then find someone like you that wants to buy it. Now, the question that I often get asked is, is, David, if they buy properties for themselves or they're a wholesaler and they get great deal, Why would they give it to me? Right? That's the question. Everyone says.

The reason is they probably don't have enough money to buy properties that they get under contract, just like you were worried that you didn't have enough money at one point, okay? Everybody out there has the same problem. They either don't have money and they have deals or they have deals and they don't have money. But no matter where they are in the cycle, somebody's going to have a property that's a really good deal that they can't do anything with. You want to know that person and you want that person more importantly to know you,

so they bring you that deal. Now, the analogy that I like to use is I don't want to just go learn how to catch fish. I want to find a fisherman that is so good at catching fish that he catches more than what he can actually eat, and the fish are going to go rotten if he doesn't sell it to me at a discount, right? Now, I often find the most success with this with wholesalers, but I also do it with other investors who will earn a wholesale fee for bringing me a deal or a real estate agent who does it himself, but he's got three or four going on and his contractor is completely swamped and he doesn't have any more money. You might as well represent me in the sale of it than just lose it completely because that fish is going to go bad, right? So by using the lapse funnel to continually what we call lead generate for more leads,

it can be properties for yourself or it could be people that are going to find properties and let them know, if you find me a deal that means these criteria, I will pay you, fill in the blank. $5,000. I'll send you a bunch more referrals for your business. I'll let you partner on it with me, whatever you want to do. But find people that are also like you looking for deals and don't think that they won't help you just because they're also looking for deals. They're going to find fish that they don't have time to eat and they want to sell

it so that it just doesn't go rotten in the boat. Wow. Have you guys noticed David's really good at analogies? He's fantastic. All right. Another technique for finding deals, check out things like Zillow. I mean, I actually got a deal last year. Just somebody who was like, I want to sell my house. I don't want to use a real estate agent, but they know Zillow because Zillow is a, you know, it's a powerhouse, right? So they just went and posted or like put their house on Zillow. And I happened to be looking at it that day and I went and bought it and we flipped that house. And so check things like Zillow, but also you can just spend time analyzing deals you find over on Zillow or Realtor or Trullier Redfin and get real comfortable with it.

Those are good sites as well. Another online website you can go to find deals actually is called biggerpockets.com. A lot of you didn't know that we actually on Bigger Pockets have a marketplace. There are hundreds and hundreds of deals being added every single week from wholesalers around the country, from turnkey providers, from real estate agents. They list the properties on our marketplace and you can go in there and dig in and see what you can find. That's especially helpful since it's a national page if you're interested in buying out-of-state.

So every, you know, day or so just go in there. there and run through the list of all the new marketplace listings, you might find your next fantastic deal there. And then let's go to the big one that most, I'd say most high volume real estate investors use, and that is direct mail marketing. And I talked about it earlier. I sent out 300 letters. But yeah, it's like a simple process. You send a letter and then you get phone calls back and then some of them work out, right? It's just leads, lapse funnel, right? The problem is people will do like one direct mail like letter. They'll send out 500 letters, a thousand letters, whatever.

And then they don't get any calls. They don't get many and nothing works out. And they're like, this sucks. It doesn't work. Brandon's a liar. And then they go back to watching TV every night, right? But the people who are successful, they just consistently send letters trying to tweak and test them a little bit.

But they're always trying to improve their game. And over time is when direct mail marketing works. I mean, I've heard some stats and I don't know the exact ones now on top of my head. But it's like the average direct mail caller doesn't call until they've received like seven letters. Like it takes time and you got to make sure you get a letter. to them when they're in that moment of, okay, fine, I'm going to sell this thing. So drug my marketing can be very powerful. If you're going to take advice from anybody on persistence, it needs to be Brandon Turner. This dude married somebody so far out of his league that most

people wouldn't even believe me if I told you, he out kicked his coverage because he was so stinking persistent, right? If he got a great deal in a wife, you can get a great deal on a rental property using the exact same strategies that this guy uses, okay? What I tell people is if your job was to go out there and you wanted to chop down a tree and you swung the axe one time and the tree didn't fall, would you quit? What if it took five swings, would you quit? You're actually worse off if you swing five times and quit before that tree goes down because you've spent all this energy and you got blisters on your hands and you wrist thrown at your back and then you got no result, okay? You don't find success from hitting a home run on the very first pitch that you see. You find success

by slowly whittling down that tree over and over and over until it finally topples. And through the process of that, you learn what worked and what didn't work and the next time you go chop down a tree, you do it in half as long because you learn how to swing the axe better. Direct meal works the same way. Look at those analogies. That was wonderful. All right. All right. Next up is driving for dollars. You guys hear about this one a lot. It's also door knocking, okay? This is simply looking for properties that appear like they're in distress, knocking on the door and seeing if you can talk to anyone who lives there or finding out who the owner is through the tax records and sending them a letter saying they want to buy their house. Now, what I found is

there's three different ways that people find motivated sellers. It's from some form of The three forms are market distress, personal distress, and property distress. Market distress would be like 2010 when we talked about every single thing was for sale because the economy was in shambles. Personal distress is really the best way. That's where you find someone that's going through like a divorce or a death in the family or a gambling debt or whatever they have going on. They have to sell that house really fast.

Property distress is the ones that I tend to target. The house itself is in disarray and so it's not worth very much. If you're driving around and you look for houses that are in property distress, you're increasing your odds. by a lot that that lead is more likely to turn into something that's worth analyzing that's more likely to turn into something that's worth pursuing. If you don't know what to do, put on the bigger pockets podcast, drive around and educate yourself. And while you're doing that, look for houses that have really high grass, need a paint job really bad, look like nobody's been living there,

newspapers all over the place, all the signs that someone just stopped caring about that house. And then find a local real estate agent and say, I'd like to get the mailing address for this property right here. They can look it up in the tax records for you. You can send a letter to that person and say, hey, I want to buy your house and your odds of finding success are much bigger. Yeah, that's awesome. All right. Let's go through another couple. Here's a really tangible one that you can do right now. If you have no money to find deals, I'm going to give you something that it takes persistence,

but it can work really well. And that is using Craigslist, but not like posting an ad. You could do that too. That's not a bad idea. But I'm talking about going to Craigslist and finding mom and pop landlords who have listed their properties for rent. You can usually find them because they're not very good ads, right? Property managers, you can kind of tell which ones are those and real estate agents if they're

listing it. But look for mom and pop landlords who just are using. Craigslist to put their property for rent and then call them up. I mean, like, that is a lead right there. And why do I say that? Because every, like, I would say most, I don't have any stats to back this up, but I was saying most landlords hate their life. Like, most landlords have not read the book I'm managing rental properties that my wife wrote most of. Like, like, they don't care. They haven't read the books. They haven't talked to other landlords. They just somehow fell into it. And now they hate it because their tenants are taking advantage of them and they're not paying

their rent and they're having problems. There's a lot of that that goes on. So by calling those people. I mean, they give you their phone number right in the ad usually. Like, how much easier can it get, right? And you call them, be like, hey, I'm a new real estate investor and I'm looking everywhere to find my first property and I saw you had one for rent. And I'm not looking to rent it, but I would love to talk to you about buying it. Does any, any chance you want to do that, right? Yeah, nine times out of ten, you might hit a no. And one time out of ten, you might hear a yes. Or maybe let's talk about it. Right. In fact, I'd probably guess more than one out of ten, you'll get a, hey, let's talk about it.

Right. Everything's for sale to an investor for the right price. So get that. conversation going, and again, now you've got the leads, you're going to analyze some. You're going to have those conversations and you're going to pursue some of them, get rejected a lot. It's going to feel like high school prom all over again. And then at the end of the day, you're going to get some accepted. But here's the deal. I've told this to people all, like, all the time. And I've done this a little bit, but I'll tell you why I failed at it and why almost everybody does, because I'm not persistent or consistent about it. Right. So I've done this one a few times, but like, it's hard. I hate picking up the phone, right? So what I need to do,

I'm just thinking out loud here. Like, what I need to do is hire someone who likes the phone and they're going to make phone calls. And not just once. I want you guys to grab your phone right now. If you want to do this, grab your phone right now and hold it up. And you know how you can talk to Siri, right? So like, hold on and they like, remind me every Monday at 5 p.m. Go to Craigslist and get the landlords.

Right? And then Siri's going to do it for you. That's all you got to do to be able to get, like now you've got a system that you can work each and every week. And if you did that for 52 weeks in a row and you called 20 people every single week, Do you think maybe somebody in there would want to sell you a house and maybe you could work the laps funnel out, right? And if you're like, oh, I'm busy. I don't have time. Do you think you could find somebody that just has some stay at home time and say if they want to do it?

I mean, 20 phone calls a week is not that bad, right? So anyway, that's just another very simple thing. You don't have to have any money to do it. You just got to have some hustle. All right. Now, keep in mind that you may call those people email, those people reach out to them and they say, no, I don't want to sell, right? They may not want to sell today, but what do you think about six months later when the pipe is busted and the tenant hasn't paid the rent? and they have a dog that bit someone and they're looking at a lawsuit.

And all of a sudden, their emotional state is, oh, my God, I don't want to be a landlord anymore. If you don't call them when they're in that mood, somebody else is going to. It's going to be a real estate that they reach out to to sell their house or it's going to be another investor that buys it. It is very important to be systematically and work a process and politely call that person consistently and say, hey, I still want to buy your house. Are you interested in it yet? No, okay. And then two months later, three months later, do the very same thing because there is going to come a time where a lot of them don't want to own it anymore.

And with that same technique, we can find another lead source, which is going to be meetups or other real estate investors, okay? Lots of people own real estate. You are in the mood, if you're a bigger pockets person, of I want to buy as much as I can. I want to own as much as I can. And that's awesome, okay? There's a part in this cycle where you don't want to be a landlord anymore. You don't want to own real estate anymore. Either you're not good at it or you bought bad properties or your life has changed and you just don't want to put the time into it anymore and you want to get rid of it.

Be the person that finds that person first and say, hey, if you ever want to sell, I want to. be the first one to get a crack at it. I want to buy these properties, okay? Landlords on Craigslist, yeah, the reason that's going to work is because you know they own properties. Well, so do other investors, okay? And if you can build a really good relationship with that person through meetups, through RIA meetings, through bigger pockets, through whatever you're doing, they're going to come to you first. And I'll give you guys another little quick tip here. The more someone likes you, the harder it is for them to take advantage of you. The more they like you, the better price than better terms they're going to give you on that deal, right? So networking with other investors and letting

them know what you want to do and why you want to do it and bringing value to them is a great way to get first shot when they want to sell their properties. In fact, so here's a story. I haven't actually told the entire in-depth story yet about how I got the mobile home park that I got recently, but what happened was Ryan Murdoch, who's been on the Bigger Pock's podcast back last June, I think. He had bought a property from another Bigger Pockets member, and the guy had carried the contract on at seller financing. Anyway, so this is a few years ago. So now this investor was getting ready to retire, like completely get out of the game. And he had this mobile home. So you know what this guy did? He didn't go enlisted with an agent. He went and emailed Ryan and said,

hey, do you have any interest in a mobile home park? Ryan was like, no, not really, but I know a guy who does. So then Ryan called me up and said, hey, Brandon, I know you wanted a mobile home park. What do you think of this one? And he thought there was like no way I was going to care about it because like, you know, he thought it was a long shot. But it was exactly what I was looking for. So I said, sure, Ryan, if you partner with me on it, because I ain't going to buy a property. I mean, I'm in Hawaii right now, right? That's like $6,000. You cannot get farther away from Hawaii than Bangor, Maine. But Ryan partnered him with me on it. We brought in Mindy Jensen as well and her husband Carl.

And boom, now we got this awesome mobile home park deal that it's kind of like we use bigger pockets in so many ways. And we use that same technique you're saying. Just keep relationships with other investors. They can oftentimes be a great source. You know, one more just quick tip. And then we're going to move on to no time in finding deals. And this is just one last thing I'll tell finding deals is tell every single person you know that you're looking for a deal and get specific. Right.

So two quick, quick stories. The first one, when I was looking for my very first apartment complex, I read a book on buying apartment complexes. And like, it was a Ken McElroy's ABCs of real estate investing. And the next day at church, I was like talking to this older couple and I said, hey, someday I want to buy a apartment complex. And they're like, well, that's weird. We actually have one we want to sell.

Right. Was that lucky? Of course. Did I tell every single person I knew I wanted to buy an apartment? Yes. Right. Yeah, take advantage of luck. So just like tell everybody you want.

So when you're, when those situations come up, you're prepared. Second quick story, even quicker. I was at a real estate meetup that Darren Sager was holding in New York City. He's got an awesome meetup. He's holding pretty much monthly, brings in some really great speakers. And I was there. And I was talking about how I wanted to buy a mobile home park to everybody that was in the room. Everybody could tell.

And you guys have probably heard me as well, right? You know who was in that room that day? Mr. Ryan Murdoch, the same guy who then two weeks later received an email that said he, I told everybody in that room I wanted a 50 unit mobile home park. He got an email from a guy that had a 46 unit technically zoned for 50 unit mobile home park. And so I was top of mind to Ryan to think, oh, yeah, Brandon just said, he just told me last week or two weeks ago, he wanted one. So tell everybody you know. You never know who's out there that might have a deal.

If you have, like, you know, 50 friends that know you're the guy or you're the gal who buys real estate, they probably have 50 friends as well. So like, that's, I don't know the math there. It's a lot. Right. So like, there's a lot of people out there in your circle that know people who might sell you their property. So again, tell everybody. All right, we got to move on to the next one. This is going to be the world's longest podcast.

And the last one that will. A lot of people struggle with. They might have some money. They might have some deals even now, especially I have to listen to this. They're just saying, David, Brandon, I just don't have time. I got a full-time life. I got a full-time job. I got family obligations.

I got family obligations. I got, you know, civic obligations. I got, just life is busy. So I want to talk about that for a few minutes because, like, I know what that's like, right? Like, for those people who know me, like, this is going to sound like total, like, bragging. But, like, I have, like, one of the busier lives of anybody I know generally, right? Like, I do a lot of stuff constantly.

and I'm still writing books and I'm still trying to raise my little girl. I'm trying to surf on the beach in Hawaii. Like, I try to become cramolize in. So I've learned a few cool techniques to reduce the amount of hours that takes. So the first thing I want to mention is this. Understand that you have 168 hours in your week. That's actually how the math works out, right? So take 168, subtract out your 40 hours that you are at work and you're at 128.

Subtract out another 20 hours of, let's say, commuting and random, like, getting ready or and stuff. So now you're at, what are we at, 108? Right? take out another 50 hours of sleeping. That's fine. You're still at, what, 58 hours now of every week that you're just like losing. So I'm not saying that you don't, like, what I'm saying is this, take an inventory of what you're spending your time doing. Because with 168 hours in your week, there's probably time somewhere. The second point I'll make to that is this. It does not take three or four or five hours a day to invest in real estate.

Almost every single task. Me and David have been actually talking about this a lot since he's been out here. We've been just talking about how almost everything we do is like a one minute task or maybe a five or ten minute task. Very few things in real estate other than reading like a book or reading a contract take more than about 15 minutes. Here's what I mean by that. Right now, the next thing that I need to do to, you know, let's say let's go my apartment complex I got in Cincinnati. Like the next thing that I absolutely have to do to get that thing moving forward is I need to contact my assistant who is another tip. but I have a very, very part-time assistant. I need to contact her to have her contact the property manager on a systematized process.

So it's like a five-minute email I need to write. And then that's moved off my plate. It's onto somebody else. Now it will get kicked back to me. I'm going to move it on somebody else. Everything's like that. Maybe you need to analyze a deal, right? Maybe you need to make a phone call to an agent.

Maybe you need to go on Facebook and ask for recommendations for an agent. No matter what it is, everything is like a five-minute task. And if you are consistently doing that every single day, that's when progress gets made. The problem is people are like, you know, I don't have any time. So they work on their real estate for an hour or two one day because they're excited after a podcast like today's. And then they don't touch it again for a month.

And then they come back and they do it again. Like that logic does not work. Think about going to the gym doing that, right? I'm going to go run the treadmill. And then a month later, I'm going to go lift some weights. And then a month later, I'm going to go do the elliptical machine, which is pretty much worthless, I think. And so at the end of the day, like consistency is what matters.

Consistency with the right things. And so figure out what those few little things are that you need to do. And the way I generally recommend it is analyze a deal. Spend five minutes a day running the numbers on a deal, maybe through the bigger pockets calculators or however you do it and do that. Or spend 10, 15 minutes a day getting some leads coming in somehow. And over time, that compounds on it stuff. It's like the compound effect by Darren Hardy.

Anyway, those are just a few of my tips just for thinking about it. But David, I'm sure you got some more because you know a thing or two about not having much free time. Yeah, that's right. So the way that I got started buying real estate was by working like crazy. I was working a literal 90 to 100 hours a week and sleeping in my car twice a week because I didn't have enough time to drive home and sleep and come back again. So I was doing this with very, very, very minimal time. And what I found out is exactly what Brandon just said.

Most of the tasks that I was doing were somewhere between 30 seconds and three minutes. It was very little time that actually had to be spent once I understood what I was doing. Okay. So I came up with a couple of things that I can share with you guys to actually save myself a lot of time and remove that excuse of I don't have enough time. The first is what we call the 1% rule. The 1% rule is just a rule of thumb that states if a property rents for 1% of what you paid for it, it is very likely to cash flow positively.

So if I'm paying $100,000 for a house and it rents for $1,000, it will cash flow positive. $200,000 for a house and it rents for $2,000, it will cash flow positive. Now, you don't have to be right at that. But if you're close to it, odds are that that property is going to cash flow positive. I don't look at buy and hold properties that don't meet the 1% rule because I don't want to waste my time, right? I can right away throw out a ton of stuff that gets sent to me by not looking into it. to it. Another thing is I got really, really specific on my own criteria that I wanted for a house, and I didn't make so many of them that I would fall into analysis paralysis. Okay. So when anybody

brings me a deal, the three things that I'm looking for are, am I buying it under market value? For me, that means I want to be all in acquisition plus rehab for 75% of the ARV. So I want to be paying 75% of what that property is worth when I'm done. I want it to cash flow positively, which means it's going to need to meet the 1% roller close to it. And I want it to not be in a really bad neighborhood. If it meets those three criteria, I will buy it. Now, the reason that I can be so liberal with the way that I'm buying houses is because I know if it's 75% of what it's worth, I'm going to be able to burr it and get all my money back out. And as long as it cashless positive, it's not a bad neighborhood. Why wouldn't I do that deal? It doesn't have to be a home run, but that's a pretty freaking good deal.

And then I can go buy the next deal, right? Because my criteria are simple, but effective and safe, I don't need to spend a ton of time analyzing 50 properties and trying to figure out which is the best of these 50 that I could buy. just go buy the six that make the most sense, right? Or pick one out of those six and say, this is one I feel best about, buy it, burritt, see what I learn and go and do the next one. That's really all that you need to be thinking about when you feel like you're overwhelmed, you don't have enough time, is that you're probably making this more complicated than it really needs to be. Yeah, I like that. And another thing on that note is I don't typically, and this is maybe a little more of an advanced strategy, but I typically don't look at a property

until I'm in negotiation on it. Here's what I mean by that. So if I typically only get about one out of every 10 offers I make accepted. So, like, why would I go and look at those 10 properties? It's just waste my time, right? So when I find a property, I run the numbers based on all of my best estimates, whether my, if my agent's been in the property, hopefully, if I've had a contractor, maybe in the area, they might look at it. I'm not going to worry about any of that stuff. Or I'll just make it based on the photos. If it looks pretty good in the description, I'll run my numbers as good as I can, and I'll make an offer. Nobody, in the last five years, I've never, I don't think I've ever had an offer just flat out accepted. There's always some negotiation,

because everyone feels like they have to negotiate, right? That's when I go look at a property. So I wait, like, they're always like, okay, if I offer $95,000 for a property, they'll come back and be like, no, 120. And I'll be like, okay, well, I don't know if 120 will work, but let's go look at the property because now I've got a really good shot of getting this thing. And that's when I'm going to go and look at it.

So that has saved me a ton of time. Too many investors get caught up in the, like, I got to go look at the house, and my agent can't go until Saturday. And so I'm going to go on Saturday to look at it. It's going to take an hour to drive there and an hour to look at it, an hour back, and an hour over coffee that I got. I got to talk about the deal. And by the time they're done, they spent five hours and then they get rejected.

What a waste of time. You got to optimize your time. So anyway, that's another one. Another thing that I do is I constantly, you know, we talked about earlier about how almost every task is like a one to five minute task. Identify what that is. I call that the minns, M-I-N-S, your most important next step. Like, any tasks that you have, any big task in the world, like, I need to buy a rental

property. I always ask people, what's your very most, or like, what's your most important next step? And they're like, I got to buy it. I'm like, no, get more focused. Okay, well, I need to find a real estate agent. Nope, that's not it either. What's your next actionable step? Your most important next step.

I need to open up a browser window, navigate to Facebook.com, ask my family and friends for recommendations for agents. Now you have your most important next step. And you realize how stupid it is that you haven't been doing this for two months. Like, this has been on your plate for two months. And it's really only a 30 second task. So now you go do it. Either you do it then or you time block it.

you put it on your calendar as an appointment more important than meeting with the president, and you do it when the time says. You put in your calendar. You schedule it in. If you have to wake up 10 minutes earlier, wake up 10 minutes earlier. If that's what you got to do. Again, and I said it a minute ago, but I'll say it again now. The bigger pockets calculators make it very, very simple and easy.

I mean, let's be honest. Like, when we built the calculators, when I designed them and I put them together and a header developers build it, I did it more for my own sake or as much as for my own sake as anybody else. Like, I needed a better system for analyzing deals and keeping. track and organized on all that. So we built the calculator, so you can quickly run the numbers in under five minutes, figure out how much you can pay for a property.

Then I go an offer on it. And if you get rejected, there's even a feature that most people don't know about in the calculator that you can get reminded about that property later on. So I'll go in, if you click the word tools on the nav bar and go to previous reports, there's like this little ellipsies next to every one of the reports you've done. Click that and it says, remind me. You can choose one week or I think it's like one day, one week, two week, three week, four week, whatever.

So that way, if I want to go and reoffer out a month from now, I can do that. Or if I didn't want to follow up with the seller a month later, two months later, bigger pockets will actually remind me, which is a super thing and cool thing. So again, there's just these little techniques to be able to simplify your life. And the last thing I'll say is this on that point. When I got started and I started getting overwhelmed back maybe like eight years ago, I needed help simplifying all the things I was doing, right? So I brought in some help.

I realized I hated answering the phone. I hated talking to tenants. So I actually brought in my mother-in-law and said, hey, would you mind, and I think we paid her a couple hundred bucks a month when we started. We said, would you mind just answering phones and then just write down the message and then get it to us? And that was it. But that one thing saved me so much both actual time and like mental energy so I could focus on building my business. So people think all the time, well, I don't have enough money to hire a full-time assistant.

Don't do it. Find like little tasks that you can find other people to take off your plate. Maybe it's an overseas person. Maybe it's a family member or a friend or somebody who just needs to earn more money. Listen, like for every task that you hate doing, somebody puts food on their table doing that task, right? For every task you hate doing, somebody loves doing it. If you hate answering the phone, somebody loves answering the phone. My mother-in-law loves talking to tenants.

It's like her thing. She's like, it's amazing at it. And like, that's all she wants to do. She doesn't want to be involved with like buying, like, oh, they are now buying property. But even that, like, my father-in-law handles a lot of that stuff as well. So like, find people to do those little tasks in your life if you can't afford a full-time assistant. Anything you want to add? No, that's a mic drop, man.

That's very good. All right, guys, so we're going to shift gears here and head over to the world famous Fire Round. It's time for the Fire Round. If you own a large or complex rental property, congrats. And I'm also sorry. One day you're building a portfolio. The next, you're reconciling six accounts, five states, four LLCs, three partners,

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and we're going to address them because these are real questions that people are asking. But before I get to that, I just want to say, I hope you guys enjoyed that last segment of the show, like that whole segment of the show.

It's a little bit different show. So would you guys do me a favor? Head over to the show notes page for this podcast episode. You go to BiggerPockets.com slash podcast and you'll find it in there. And let us know in the comment section if you enjoyed this.

Any questions you have, any comments you have, let us know there. Kind of gives those feedback. Do you like more? Do you want more of these shows? You can also hit me up on Twitter at Brandon at BP.

And let me know, like this format. If so, we'll do more of these. If not, maybe we won't. But I thought this was kind of a fun idea to test out. So with that, let's get to the fire round. These questions again are from the Bigger Pockets forums. First question, few would deny that the market is cyclical. It goes up for a few years and then down for a few and then repeats. I want to hear from other investors, your thoughts about how to handle this. We're nearing the top, especially my area, and it scares me a little. I want to keep investing, but I worry about timing. Should I hold onto cash and wait for the downward cycle to begin? David, what do you think? This is an awesome question. And this is

why I wrote the book, Long Distance Real Estate Investing, because markets are specific to where you live. It is not the same market in the entire country. One market could be nearing in top. Another market might not have even got it started yet. And another market is getting some Amazon Supercenter that's about to go in and it's about to blow up. Okay. You may be maxed out at your market to where you feel like you're at the quote unquote top, but another market is ready to run and you can get in there. By learning how real estate investing works, you can be empowered to go invest in the markets that make sense, not just the market that's close to you. Okay. When people tell you, me that they're afraid that the market is reaching the top. The first question I ask is like,

well, how do you know what the top is, right? It may seem expensive to us, but are you taking into fact that wages are going up to and jobs are growing and companies are moving in and interest rates are really low and is it really near the top like what you're thinking. The next question I ask is when you say top, do you just mean that it won't cash flow anymore? That's what most people think. I can't buy a property that cash flows anymore. There's two things that you can do. One, you get better deals by getting more leads, pursuing those leads harder, analyzing more of them, and finding success or two, you go to a market where you are more likely to have success. Now, because I'm very busy, just like Brandon is running the businesses that we run,

it makes more sense for me to go to a market that has a lot of deals, right? I actually look for markets that have a high day on market. The average house takes a long time to sell there because I don't want to be fighting with 19 other investors that all want the same property. And I know that my appraiser is going to value it based on the comms. He doesn't care how long it sat on the market for. That's not going to be hurting me. Now, if I was trying to flip houses, it might not make sense for me.

but because I'm buying rentals, that's something that I want, right? I go to areas where I know I have a competitive advantage and it's going to be easier to find a deal. So I don't care what my market is doing because it's not my market. It's just the market where I live in, right? If the market that I'm in right now decides that it's going to be too expensive, it's too hard to find deals. Other people are there. I will go to another market and I will put my system together, build my core for, and start getting deals out of that area. Remember that real estate is market specific.

What is happening in your market is not what is happening in other people's markets and don't get discouraged. Yeah, that was great. The only thing I'd add on to that is like buy good deals in bad markets, buy good deals in good markets, buy good deals no matter what. That's why it's so important to run that lapse funnel and to know the numbers. So all right, next question, I'll let you take this one. All right. Does anyone have any tips on how to handle cleaning of the unit after guests leave? This is like an Airbnb type of a situation. There's a small window of time each day to clean and is almost impossible to do it yourself while working a full-time job. Brandon, you do Airbnb, right? I had an Airbnb. I actually just sold that Airbnb and basically, it basically, it basically

became just a flip. I held it for a year. And I'm not going to go into the reasons why I sold it, but basically it was just too much work. And this is one of the reasons why, because coordinating cleaners was tough. Now, this person's asking, how do you do it when I have a full-time job? You don't. Like, that's just a short answer. It's like, you don't clean the unit when you have a full-time job. You find somebody else. Remember I said earlier, for every job you hate doing, there's somebody who puts food on the table. There is somebody in your market right now who wishes they had a flexible job that they could go to for a couple hours to go and clean because they can't go and get a $100 an hour job at the local whatever,

but they can clean a house, right? There's people that are desperate for that job right now that you could actually help them put food on their table. You need to find that person. So what we did is we found a couple different people. There's one primary, and we just let them know. Here's what the deal is. People come and they usually stay for a day or two days or three days.

We need you to be flexible. And when they leave, you got to get in there. Like, there is no other option. Can you do this? We set the expectations up front. We define what we needed. And also, we have a very, clear checklist on what has to get done. This, this, this, this. We had pictures even on what we

wanted things to look like within the Airbnb. We systematized the whole process and we had a first person and then we had a backup in case the first person for whatever. Like one time her car got stolen and she couldn't do it. Had a backup run in there and got it done. So that, like, again, don't do that yourself. If you're using Airbnb that the guests are actually paying for the cleaning anyway. There's a cleaning fee. Like, don't look at that as income. Like your time is better spent finding deals or spending time with your kids. So that's my answer to that one. All right. Next one. That is awesome. Thanks. All right. If I was wondering, I was wondering if I should be building a website before I start my wholesaling business.

I was looking at my list of things I do. And we was wondering if I can get buyers and sellers on my team if I do not have a website. What are your thoughts on that, David? So a website is a tool that can help you, but it's not necessarily something that you have to have. Okay. Wholesalers do a good job because they find people that are in distress and need to sell their house. And because they have a deal, it's easy to go find a buyer. Like Brandon said earlier, find the deal and everything else is going to come. Having a website can help you, but it's not something that you absolutely need to have. Now, in today's world, having a website is so easy. I can't think of any reason why you wouldn't want to have one, right? If not for the simple fact that

when you're reaching out to people, it will just help you establish rapport that you can say, look, I have a website. I'm more professional. It might not be super effective at finding deals, but it might make your job easier once you found them to kind of build rapport with that person and get a deal. Now, a lot of people do use websites and they're very successful at it. I know there's one company called Investor Carrot, I believe, that basically makes like a high SEO website right out the box that helps people find you when they're looking to sell their house. Those work better in some markets than another. If you were in California with an investor carrot website and you know your house is worth half a million, you're not going to go to wholesaler and let him buy it for 200,000 very likely.

But if you're in like Indiana, Kentucky, some of these areas where they have like not as many people chasing after houses, you're more likely to call the person or to Google, hey, sell my house in Indiana, I want to get a good deal. Lead propeller is another one. That's a really good website that people use that they can drive traffic to them to find these deals. And they're not very expensive. Like, this is a really good way to kind of get started. See what works, see what does it, and then start building from there. You start writing blog posts and driving traffic to your website. And you start reaching out to other people like Brandon said and telling them, hey, I am looking to buy property. Here is my website. Check it out. If you hear of anyone that wants to sell, call me or have them

for my website, I can get in my idea what their house would be worth as someone who's going to buy it for cash. For me, in my opinion, this is a really cheap, easy, and quick way to get yourself started. You don't have to do it, but I don't know any good reasons why you wouldn't want to. Yeah, I actually made my website. So I have two of it. My apartment buying website was built through lead propeller and my like home buying website was built through Wix.com. It cost me like $8 a month or something stupid cheap like that, right? The one that's cost me $8 a month, I actually did a flip last year, made $50,000 on it. She found me through that website. So was that worth $8 a month for that Wix website?

If you guys go to YouTube also, if you type in, well, just go to Bigger Pocket's YouTube page and then look for the most popular video that we have on the entire, on the YouTube channel. You can like sort by popularity. The most popular video we've ever put out, it's got like, I don't know, almost a million views now, I think, maybe half a million. It's on how I built that exact website. I filmed it like four and a half years ago.

It's horrible quality because I was not really sure what I was doing with this technology stuff. But anyway, that video, people tend to like it a lot. So if you want to learn exactly how I built that website, website that made me 50 grand. Check that out. All right. So let's see. Last question of the day on here is not actually a question. As David and I were going through the forum, trying to look for a really good question, we just saw this post and we're like, we just have to talk about this for a minute because this is like the coolest thing. So James K put a post on there that basically said, let me pull up

and read the exact title of it. Multifamily Burr strategy. We talked about it earlier. It's like buying fixer uppers and then refinancing them later after they're fixed up. So multi-family burrers. strategy that created $4.5 million of value in 12 months. So James Kay is a syndicator in Austin, Texas. I think this property was actually in San Antonio. Yes, in San Antonio, 174 units. They basically, like, did the birth strategy. They bought it.

They fixed it up. And then they rented it, like, you know, raised all the rents, rented it out, got it fully working well. It says this. The deal was bought at $6.9 million. They added $1.3 million to the rehab. So now they're at, like, what, mid-eighths? the property then appraised at 2.7, 12.7, creating $4.5 million of value in a year.

And then they went and refinanced it because now it's got that new value. And they actually pulled out all their money and then some. So they actually made money at the thing. And so now they can go back with their investors money and do it again and again and again. Right. So anyway, that I just thought it was super cool. James Kay, nice work. Well, some of the things that I love about this post is that he's using the techniques that

we're talking about in this exact podcast to help you guys, right? So he bought this at a very steep discount. He said he bought it at $39,000 a door. Why? Because it was a direct buyer-seller transaction. He found an off-market deal where the seller needed to sell that property. They were very motivated and he was able to buy it. And then he did what we called the seller financing where he actually assumed the loan that they already had.

He didn't have to go get his own loan and pay closing costs, right? He got to take over a loan that they already had, which was in really good shape. And when you're buying multifamily properties, the loan can be a really big deal. He's able to just take theirs. Then he went in and he rehabbed it effectively, he added value through the reaffed. had he painted it he added new fixtures they made the place a lot nicer and that ended up increasing the rents by 173 dollars per door on average and this was what 169 units i think that it was 174 massive value that he created by bumping the rents up that much which made that thing worth so much more okay by combining all

of the tools that we've talked about today from his tool belt they were able to put them all into the same deal and create four and a half million dollars in 12 months by doing a really good job on a rehab. That is why I'm so excited about real estate investing and the stuff we're talking about on this podcast. This stuff works for the big boys and it works for the new guys, right? Like all of this, it's the same tools that we're all using. Listen to this podcast again, take notes, write down the stuff that you don't understand and write down the stuff that you really like. Master it so that you really know I can do this. This is how I'm going to make it work and deals that don't seem like good deals. Like maybe this one didn't even look like a great deal, but he knew how much he could

push the rents. He knew how much he could rehab it. He got it at a better deal than what he thought because there wasn't a broker involved. He did everything right and created $4.5 million in 12 months. That is amazing. Yeah. I love that. That's super awesome. So anyway,

I hope you guys enjoyed that little. It was not a question, but, you know, we're cheating, so that's okay. All right, so let's get on here. We're going to go over to the World Famous Femus 4 here in a moment.

But before we get there, let's hear from Mindy Jensen on what's going on this week on the Bigger Pockets Money podcast. Thanks for asking, Brandon. For this week's episode of the Bigger Pockets Money podcast, we're doing something a little different. Scott and I interviewed Brad Barrett and Jonathan Menanza from ChooseFI.

But our conversation ran so long that we had to split it up into two parts. So this week, we have part one of the epic ChooseFI interview. Thanks for letting me butt into your show. I'll let you get back to the Famous Four. All right. Make sure you guys check out that money podcast too. It's super awesome. Mindy and Scott do an amazing job over there.

And with that, let's get to today's. Famous for. All right. If you guys have listened to the show before, you know that this is the part of the show where we go through the same four questions every single week. And we ask every guest. Since we don't have a guest today, it's just me and David hanging out,

talking to you guys, telling you guys what we know about solving those three big problems we all have, no time, no money, no deals. We're going to tweak the famous for it just a little bit. We want to actually just give you guys some of our favorite real estate book recommendations and business book recommendations.

And then we'll go into hobbies in the last question. So first of all, favorite real estate books, if you want to know more about these topics, a few books that stand out to me, first of all, Anson Young wrote a book that we published here called Finding and Funding Great Deals. like it's about finding great deals and then funding them. Like it's like it's a no brainer.

Go pick that out bigger pockets.com slash store. Also David here wrote a book on long distance real estate investing called long distance real estate investing. And like, yeah, we're really clever with our names. So definitely check that out as well. You can get that bigger pockets that come out at store. You can also get these books at Barnes & Noble. You can get them on Amazon.

But if you buy them at bigger pockets, you get a whole bunch of tons of bonuses. And David's bonuses are actually super cool because I filmed them in my own living room. So we actually did a whole bunch of cool video filming in my own living room. You guys will love it. So check it out again, BiggerPockets.com slash store. But that's just a couple real estate books. Anything you want to add to that or you want to go to business books? Well, I really like the book on investing real estate with no and low money down that Brandon wrote because this is a problem a lot of people have, especially when they're new. What I find is that most of the people that are on bigger pockets, not everyone, but a big

chunk of them, they're new and that's why they're here, right? There's also a lot of successful investors that are here. I've listened to every single episode when it comes out. But for those of you that are new and you're worried about specifically the no money, get that book and realize that all of these problems have already been solved. You just have to use a tool that somebody else has already made. Another book that I really like is by Gary Keller is called the Millionaire Real Estate Agent. Now, the reason that I like this book because not everybody out there actually wants to be an agent or should be an agent is because he basically outlines what Brandon calls the lapse funnel. He talks a lot about how it is all about getting leads and then working those leads into the success that you're looking for. and it applies very, very, very strongly to real estate investing.

If you can train your brain to start working backwards from your goals, right? Like, I want to have success. For me, that's buying a house. How am I going to do it? I'm going to have to write offers. How do I know what offer to ride? I have to analyze a property. How do I know what properties to analyze?

I need to get leads. And then start working backwards from there using the men's, the most important next step. Okay, how am I going to get a lead? Well, first, I have all these things that Brandon and David just talked about that I can start pursuing. I need to start telling other people. I need to be joining a meet up. I need to be meeting real estate agents and meeting

contractors and write down a list of everything you need to do, and then use the men's funnel to figure out what's the most important next step that I should be taking to get myself a lead. By combining these things together, you're going to get great leads. Was that just so fire that it made you sneeze? Yeah, that was so fire. Anyway, sorry, I interrupted you with my scenes. No, that's all I'm getting at is take these techniques that we're teaching you because we've talked to so many successful people and they're all doing it. If you just copy what they are doing, you will end up having the same results that they're having. Retrain your brain to think along these terms and you'll find yourself successful

quicker than what you thought. Awesome. All right. So, let's see, favorite business book. He mentioned real estate agent. It's a real estate book, though. So business book, there's two that I want to point out that I made a big impact on me with the time thing.

Like, I don't know enough time. That is the compound effect by Darren Hardy. Fantastic book. I love that book. I actually read it over and over and over. And the next one, I actually read a lot, too. The 12-week year. Those are two books that have made a massive impact on my life.

And one more is the 80, 20 sales and marketing made a huge difference on my life as well in terms of thinking in terms of funnels and getting other people into your life to help you with things. That's by Perry Marshall. We actually had them on the podcast a while back. So again, compound effect, 12 week year, 80, 20 sales and marketing. And then, of course, the one thing written by Gary Keller and J. Pappas, and that had a big impact on my life as well. Yep. Those are pretty much the exact same books that I would recommend. And my advice to you guys would be if you know that there is something holding you back,

you have that little itch in the back of your brain that just says, I'm not doing this because of this reason. Find a book that tackles that reason. Listen to it on audio. Read it yourself. Talk to a friend about it. Start a group where you basically hold yourself accountable to all your buddies and say, look, I'm having a hard time with this thing.

It could be having confidence to move forward. It could be, I don't think I'm good at math and I can't analyze deals. It could be, I'm not a people person and I don't want to pick up the phone and talk to somebody. Talk to other investors and other buddies and let them come up with solutions for you. you for getting around it. Like Brandon acknowledged to all of you, 100,000 of people that are listening to this, I don't like to talk on the phone and it was holding him back, right?

But he didn't let that stop him. He went and found someone else that likes to talk on the phone. Not only is the phone talking getting done, but that person now likes him because he's letting them do something that they wanted to do, right? I do the very same thing in my business. Like, it could be a topic for another podcast, but I'm not afraid to say I suck at these things and I don't enjoy doing them

and I will find someone else to do it so I can focus on what I'm good at. And that's how we've been able to find success. and you guys can too. Love it. All right. Next to Washington the Famous Four is hobbies. What do we do for fun? Let's change a little bit. What have we been doing for fun here in Hawaii? We haven't been done a lot of fun stuff lately. We've been podcast. We've been masterminding quite a bit. We've been talking about like, you know, one of the things that I really like to do is find out in my friend's life and how I can help them get there with what I have going on in my life, right? And I found that when you pour into other people and you help them become more successful, you end up finding answers to your own questions and then they're more incentivized to do the same for you. So I would like to encourage everybody out here to go find the friends. that you already have are the business partners that you have and figure out what is their problem and help them solve it, increase that friendship, make it even better, make them want to return the favor for you. And maybe in solving their problem, you can kind of come up with what

would help you with yours. Yeah, that's awesome. Yeah, we've been doing a ton of that because I got a lot of problems. And David's a smart dude. So other things we've been, we're going to be doing some surfing on Saturday. That should be a lot of fun. So anyway, that's, that's hobbies. Lately has been that hanging out with family. We went to Waikiki Beach last night. We actually met Rich Carey, who was on the podcast just a few weeks back. Rich Carey is an awesome dude. We had some cheesecake factory with him. That was fun.

We got 99 problems, but Rich ain't one. Rich ain't one. So let's go to the last question. David, what do you think? I'm going to just ask you, and then I can maybe I'll chime in on your answer. But what sets apart successful real estate investors, those who find deals, who find the money, who find the time? What sets apart them from everyone else who struggles, gives up, fail, never get started? So every time I'm asked this question on the podcast,

I have a different answer as I kind of evolve through time. And what my answer is right now is I really believe that is the experience that the investor has when they first get started. If their expectation was I'm going to walk out there, make a couple phone calls, find a deal, get it under contract. Banks are going to be throwing it themselves to give me money. It's all going to be a 30-year fix rate at a really low interest. My tenants are going to be wonderful just like I would be and take care of my house.

They get discouraged very, very quickly before they've had enough success to make it worth it to power through that, right? And then they quit. So what I want to tell people is, understand that you need to protect your experience that you're going to have with this by seeking wisdom. Listen to these podcasts and understand there are going to be many hurdles that come up. It is, they are all worth it. Literally every single thing that I have ever accomplished in my life that I am proud of was hard. There's not one thing that fell into my lap and I'm like, oh, this was awesome,

right? And it just came really easy. I had to work for every single one of them. Now I don't trust it if it comes easy. It's probably not going to be good. Brandon just told us that story and it was kind of like, oh, ha, ha, my wife rejected me four times in a row. It is not. fun to get rejected by someone you have strong feelings for. That is really, really hard. And a lesser person would have quit and not got there, right? Because Brandon understood it is worth it to go through this pain, he ended up having kind of like, you know, the awesome fairy tale story at the end of the thing. But real estate can work the same way. Make sure that your experience is good by not having bad expectations and not setting yourself up to fail. Don't go after

homes that are in perfect condition and write way below asking price offers and then it gets discouraged when everybody says no. Look for houses that you know are more likely to take your Look for people that you know are more likely to trust you and respect what you do and ask them for money. Don't go to complete strangers that don't know you at all and say, can I have $90,000 to buy a house? Make smart decision so your experience isn't bad. Get some success and then you're not going to mind the headaches that come your way. I got nothing to add to that. That was awesome.

Drops Mike. All right, guys. So I hope you enjoyed this episode of the Bigger Pockets podcast. Again, a little bit different format than usual. But I thought since David was out visiting me here in Hawaii right now, I thought it'd be fun to just, you know, take his brain, talk together, kind of do a little mastermining together and try to help solve. your problems. Again, the big three that everyone struggles with, I don't have any money, I don't have any deals, I don't have any time. After today's episode, I hope you don't have those excuses in your life anymore and you can go out there and take massive action. So with that,

if you enjoy this episode, do me a favor. Share it on your Facebook page or, you know, whatever social media channel you like better or the best. Tell your family and friends about us. Like, you never know, like, whose life you could change completely because you introduce them to the world of real estate investing podcast. It's a cool way to do that. So if you thought those was a good show to share, share it. And of course, leave us a rating and review over in iTunes because that helps us reach more people by being in the iTunes charts.

So that's all I got. I hope to see you guys around. Make sure you check out the BiggerPocketsW webinars. We do them every single week. BiggerPockets.com slash webinar. And Dave, you got any final thoughts? Nope. This is the host of the Bigger Pockets podcast, David Green,

for Brandon married way out of his league. Turner, signing off. 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.

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