BiggerPockets Real Estate Podcast - 319: Avoid These Common Newbie Mistakes! Hard-Earned Lessons from Nathan Brooks

Episode Date: February 28, 2019

How does finding and closing 15 deals a month sound? Today’s guest shares exactly how his team does just that! Returning guest Nathan Brooks goes into detail about how he built a turnkey business that consistently finds and closes deals on a large scale. He also shares great info regarding how he uses the DISC profile to understand himself and his team members, his three-step process for rehabbing homes, and why he always has at least two sets of eyes on every deal. Plus, he reveals what he wishes he had done differently in the beginning and how to alternate between a “10,000-foot view” of your business and being on the front line. You also won’t want to miss his discussion about mistakes newbies should avoid. Nathan is a long-time investor with a heart-felt passion for helping others succeed. If you want to grow your real estate business, be sure to check out the incredible advice and encouragement he shares in today’s episode! In This Episode We Cover: How Nathan uses the DISC profile to understand himself What he would have done different if starting his business again His three-step process for rehabbing homes Why he always uses two sets of eyes on every deal How he utilized meetups to grow his business How his team is buying 12-15 deals a month His rule for replacing anything that doesn’t have a 10-year life span Mistakes for newbies to avoid How to alternate between a big picture view and daily activities to lead to success How he handled his nightmare flip And SO much more! Links from the Show BiggerPockets Forums BiggerPockets Webinar Seth Godin BiggerPockets Podcast 313: How to Be Happy AND Grow a Massive Business with Entrepreneur Jesse Itzler (and Josh!) Tony Robbin’s DISC Test How to Use the DISC Profile To Communicate Effectively in Business BiggerPockets Podcast 087: How to Thrive After The Collapse of a Real Estate Empire with Nathan Brooks BiggerPockets Podcast 260: The Ultimate Guide to Negotiating (for the Negotiation-Averse) With Former FBI Hostage Negotiator Chris Voss BiggerPockets Podcast 232: The Four Lead Sources Nathan Brooks is Using to Flip 120 Houses a Year BiggerPockets Podcast 159: How to Build a Real Estate Business That Buys 60 Deals a Year with Nathan Brooks Books Mentioned in this Show Traction by Gino Wickman Never Split the Difference by Chris Voss On the Shortness of Life by Seneca Extreme Ownership by Jocko Willink Go Giver by Bob Burg Fire Round Questions Any tips on negotiating with sellers in a competitive market? How can I tell if the wholesaler I’m dealing with is legit? Just curious if anyone else can share strategies for assessing property management companies? Tweetable Topics: “As soon as you can afford it, hire your weaknesses.” (Tweet This!) “The direction of your business is your responsibility.” (Tweet This!) “If you’re not taking professional pictures of your rental property, stop and start doing that now.” (Tweet This!) “Your business is only as good as you are.” (Tweet This!) Connect with Nathan Nathan’s BiggerPockets Profile Nathan’s Facebook Profile Nathan’s Company Nathan’s Meetup Group Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 319. So if you just say, like, I want a deal or I want a partner, you're not bringing the value to attract somebody else who wants that. But instead if you said, I'm looking for a contractor that I can give my time for the next two weeks on a job that's in this area, which is where I want to work, I will come and work, you know, a couple hours a day. And I'd like to learn what your process is. 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. Hey, what's going on, everyone? This is Brandon Turner, host of the Bigger Pockets podcast here with my co-host and crime, David Green.

What's up, buddy? Dude, I'm having a great day. We have an incredible interview today with just an all around solid real estate. I mean, he's not a guru, but he knows as much as one. This is a very experienced person who's kind of been through the ringer, and I can tell he knows his stuff. Yeah, he's a rock star. Nathan Brooks.

He's been on the show a few times before. We'll talk about that later. But today we talk about a little bit different topic. We go into what he would do differently if he started over. We spent a lot of time on that. We also dive really deep into the disc profile, which if you don't know what that is, it could completely transfer your business. In fact, David said in the show that it completely changed.

everything about how he ran his business. So we talk about that. We talk about how he's finding deals. He's closing 12 to 15 deals a month and he's not doing direct mail marketing. Wait to hear what he's doing to get those deals. It's something that everybody here, whether you've never done a deal or you've done 100, you could implement your business today. And yeah, it's fantastic. So without further ado, let's get today's quick tip. All right, so today's quick tip is simple. So Lauren over in the Bigger Pockets Marketing Department has been hard at work. negotiating a ton of excellent deals exclusively for our pro members.

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Steadily, landlord insurance designed for the modern investor. Without further delay, I want you all to hear this interview with Mr. Nathan Brooks. So let's get to that interview right now. Welcome to the Bigger Pockets podcast, Mr. Nathan Brooks. How you doing? I am so good, Brandon. you. Man, I'm good except I almost had Mithter.

And then that would have been awkward. So I said, there's a Freudian slip. He's the myth, right? The man, the myth of the legend. The myth. The only four-timer on the BP podcast. See, I know what you were doing, Brandon.

That's exactly what I'm doing. Thank you for supporting me there, David. And I'm supporting you, David, for supporting Brandon. So I think we're good. We've got a circle. Yeah. Let's just do this. It's a circle.

It's like the massage circles. You're doing great, Brady. You're doing great. All right. So Nathan has been on the show four times before, and I wrote down the numbers and then I lost them. What numbers were they? This is number four. So it's 87, 159, and 232, and this will be, I'm not sure.

All right. Well, this is going to be, you're pretty much on the show like every other week. So we're going to, there's a reason, though, because Nathan and I are actually pretty good buddies. We talk fairly often. We text like high school girls. And we have a good time with it. So, and Nathan, I just really, really look up to you a lot in how you built your real estate business. And so I just keep coming back to you for advice. And I'm like, why not bring the rest of the

BP nation into it? So that's what we're going to do today. Sound fun? Yeah, that's meaningful for you to say. And it's a real, in all honesty, you know, it's a real honor to be on here for the fourth time. And, you know, it's been a huge part of my growing, my success, my business and everything, too. So it's definitely mutual and I'm pumped to beyond. Well, let's go into it. So before we go into today's topic, which is we're going to be looking back and helping new investors by asking you, hey, what would you do differently if you could go back? Or what would you wish you would have known when you got started? I mean, let's first of all do away with the whole like, you know, one time I asked Seth Godin, this is a true story. Seth Godin, who's a famous author, writer,

blogger, very famous guy, I email them directly because I heard that he responds to all his emails. And so this is back like seven years ago. And I said, Seth, what would you do if you could go back and do it all over again. And he responded with, if I went back, I wouldn't be the person I am today, so I wouldn't change anything. Right. That's kind of like the, and I love Seth's game, but that's like the cliche answer. Like, of course you, you wouldn't be who you are today. So let's just throw away that. And besides that, we're going to talk about what you would do differently. Yeah, exactly. Before we get there, who are you? What do you do? How'd you get into real estate? Walk us through your story in a minute or two and bring people up to up to speed if they didn't listen

to your earlier shows. Yeah, absolutely. So I'm Nathan Broke. I'm out of the Kansas City market. I'm a turnkey provider of really well-renovated properties. We're pretty obsessed about that quality piece. And for years, you know, turnkey's got a bad rap because people didn't really do what the right thing was. So we'll do about 150 houses out of Kansas City this year. And I got the start back in the mid-2000s. And I rode the wave up and crashed and burn with the wave down.

And it had to rebuild my business, myself, my mind, how I wanted to do business. And so, you know, it's one of those things where I had that choice. I had that decision to make if I wanted to get back after it, after, you know, going through bankruptcy and having that horrible experience or not. And so started doing some more deals after, you know, post-bankruptcy and started to do some joint venture deals. And then, you know, from there, met my business partner in 2015. And that's when I really started to understand more and more and more kind of what seat I should sit in, what I'm good at, what I'm not good at, mainly from hearing from other people, right, when you actually start to listen and

learn. And so, you know, we've grown now. And so we have that turnkey company. We have a retail realtor team. This is our second year. We actually just, I just got the certificate. We had the number one listing top dog in our office for 2018, which is our first year of business. And our targets to do 30 million in sales for our second year. And then we just started a local meetup. And we've literally gone from nothing December 4th to almost 2,500 Facebook members and we'll have 250 plus show up at our third meetup ever in KC here in a week. That's incredible. All right. So on that note, let's go back and divide your story into kind of two chunks. There's what you would have done differently in the first time you got in real estate pre-bankruptcy. And then what would you do different now

the second time? Because it's really like two, almost like two different stories, right? You built something it collapsed, you built something else, both in real estate, right? So let's go back to the very, very beginning. You were first looking into real estate. What would you do different? You know, I definitely would have gone just a tiny bit slower. You know, and I think there's something about people who jump in and go after opportunities. And there's something important about that because there's so, I think there's a lot of people

who, you know, have that analysis, paralysis situation. and so we don't take the offense. But for me, I jumped in so fast and I literally had no idea what I was doing. So I was taking advantage of. I made some bad, bad decisions. And I just didn't have any context to what was actually going on, if that makes sense. It does. It does.

Yeah. So how do you balance the, I mean, it's the forever question of jumping in, taking action, doing stuff, or analysis paralysis, just not ever taking action. How do you balance that? How do you recommend new investors balance that? Well, I think, you know, now that I've learned so much about like a disc profile in Culture Index, there's a bunch of these things out here that we can learn. So I think it honestly starts with learning about yourself more first. So if I would have understood more that I'm that high deep, you know, disc profile person,

I'm going to literally just jump in, ready fire aim. And so if I would recognize that about myself, then I would have recognized like, hey, okay, we're going to jump in and that's cool. but let's make sure we understand what it actually looks like. So, you know, and really the bigger pockets of the world, you know, it's grown exponentially in the learning and in teaching and all the books that are out there. Honestly, if I would have found somebody who already had been doing it and I had learned more in kind of the path of what I wanted to look like or at least somebody that I was excited about,

would have made all the difference in the world. So now I spend so much more time doing that, you know, and now I have so much more clarity in what I want to or what I need to learn. about or what I want to go after. So you mentioned something there. I think it's credibly helpful for people and that's knowing yourself and you mentioned the disc profile is one of the ways you do it. So I know I wrote an article on bigger pockets about the disc profile and like kind of an

overview of it and how to help use it in your business. But can you explain a little of what you mean by how it helped you understand yourself and maybe how it helps you with the team members and putting them in the right roles? 100%. And I haven't read that article or I'm going to go back and read it too. So disc profile is wonderful. So to go, just kind of the short answer, D is for driver or like the general type. The one that's in the front of the room, that's probably the D.

I is influencer. So that's like a people person. High eye, low eye is not a people person. So you could be a driver and not a people person. You could be a driver and a people person. So S is stabilizing. That's like high S is, you know, takes a ton of notes and they like everything in order. low low s me you know that not in the details not not tracking all of all of those things and then

you know c is that caution and so it's it's like being high c is really really really every i dotted every t crossed super to the last 99% is not good enough so once we started to understand what all those things meant then we could say okay well you want somebody in a administrative situation to be a really won't need to be personable enough, but not so high eye that they're going to talk everybody and not get any work done. But you also need, you know, higher S, higher C, so that they're going to actually run the play, actually have the detail to do it. And so once I started to learn that about myself, then I could say, okay, well, I'm a high D, high eye. I'm terrible with details. So now I need to surround myself with people who are good at that. And one of the business coaches I have talks about

the like it and love it box. And if it's not in the like it, love it box that I'm doing, so I don't like details. Why am I doing them? So that was really the start of it. Brandon and I talk about how when something feels light or heavy, that's one of the ways of knowing if this fits within your skill set or not. But do you want to take on that, Brandon? Sure. I mean, yeah, it's just like ask yourself, does this feel light? And I think one of my coaches back in the day said that to me, does it feel light? Like if I think about like analyzing a real estate does, that feel light, it actually does. It feels like a light activity. You know, it doesn't feel heavy. But I think about calling up a contractor to tell them to pay, you know, like to show

up because he didn't show up yesterday. Oh, that's the heaviest thing of the world. It just feels like I'm carrying around a thousand pounds on my back. Right. So I've learned, yeah, it's, you know, I heard a quote from Sarah Blakely, the Spanx lady, Jesse Isler, his wife. Yeah, I heard a quote from her that says, as soon as you can afford it, hire your weaknesses. And it was basically what she's saying. It's like, yeah, find what you're good at, what you're not good at and hire that stuff out. The disc profile, by the way, people can access. There's a, there's a free one online. I know there's probably a few. I know Tony Robbins has one. If you type in Tony Robbins' disk, you'll find it into Google.

And then you can take it. You can have your team take it, your spouse take it. It's kind of cool. It's fun to kind of see. No exaggeration. It changed my life when I learned that. It seriously, it was like the Rosetta Stone that helped me understand how to communicate with people that were not me.

And I realized I was carrying around so much anxiety because I knew I'm a very high D. And then C, which is kind of rare. So my brain fights with itself. But most people just did not understand the way I thought and the way I looked at stuff. And I knew when I met a new person, I didn't feel confident that I could explain what I was trying to get them to understand until I learned disc. And then I was like, I went from feeling insecure to feeling super empowered. Like, I know how you talk to an I, I know how I talked to an S. I know how I talked to a C. And then, I mean, life just got a lot

easier. It's so true. And I love that, you know, like so a high D, high C and not to get too nerdy in the disc, but, you know, so you're somebody who has vision and somebody who likes those details. So to understand, so my business partner is a high D, high C. And because I'd always get frustrated, I'm like, as soon as I say something and I say it a couple of times, I'm like, well, why isn't it done? Right? Well, hey, guess what? If you go back and look back at my business now, some of those decisions that were made, you're like, okay, well, as soon as I say something a couple of times, I processed it out loud and then I'm assuming that it, whatever it is, whatever it takes is getting done. And it just simply not the case.

Yeah. Yeah, that makes a lot of sense, actually. I think I'm a, so David, you're what, D, you said, hi, D, high C. I'm a high, high, I, high S. Right. Which is why Brandon and I are really good partners, right? As long as our values are aligned and we have the same goal, the stuff he doesn't like, like calling and talking to contractors is easy for me.

That's a light activity. Like, I'm going to call that guy. I'm in a light of fire under his butt. And I'm even like, when we hang out, I take his phone out of his hand and I'm like, let me just talk to this guy for you. Yeah, he's done that. I do not care, right? I'll do it.

But the stuff that I don't know about doing, like putting myself. out there and being a little bit more like gregarious and Brandon is amazing with conflict resolution and making people feel comfortable. Even the way that the podcast works out, if you think about it, Brandon does a lot of the getting the guests going and getting them moving and getting them comfortable and carrying it. And I kind of hone in on specific details because that's what a DC's brain is going to do. This is so much easier because we understand that and then we can build out the system. And I really feel this is applicable to even the newbie investor because there's things about there themselves that they don't understand about why investing seems so scary. If they're like,

I don't want to go to a meetup and talk to people, I do not like people. That's not what you should be doing. Get a business partner who's like, I don't want to understand a spreadsheet ever. I just want to go tell everyone and hand out business cards and be fun. You marry those two things together and then investing's fun. Huge. It's huge. And you mentioned something that I think that you can't underestimate either, which is the culture in which you have it built and those values. And once you start to understand the culture and value part. And it's not the same. So we think about and we see these core values and we have, we've done that in our business. But, you know, it's, it, those values are indicative of the leader in that organization. And so they help, they're the guiding principle to

the way that that business runs. And the more I learned that, the more I understood that, hey, not only is it, is it like, you know, having the right person, right? And you have, so you understand the disc and you put them in the right seat. That's the Jim Collins, right? The, in the right seat on the right bus with the right leader going the right direction. But then culturally right and you start to realize that those things attract and reject each other. And if the culture, if it's right, you are going to have those people attracted to what you have going on in the first place. Yeah, I 100% agree. And I love that analogy of the get them on the bus. I use that phrase a lot. Yeah. When you find really talented people, get them on the bus, get them in the business,

find out where to put them, you know, find the seat for them. And if you have moving around a little bit, you can. That comes from good to great, right? Jim Collins. Good to great. Yeah, exactly. And the most terrifying thing about this in any person and any level of wherever you are in your business is that the direction is your responsibility. And so even if you've never done a deal before, now if you start thinking about, okay, well, these are my strengths and these are the things that I could do a really good job on. And then I can help, you know, understand who I need to put around me. And it might not be even having people on your team or on your staff, so to speak, but you still need to have, you know, an attorney and a title agent and

whether a real estate agent, whatever it is, contractors. And so now you start to understand what type of personality they are in the way that you communicate with them and all the more clear, all the more those expectations come out the way that you want them to be. Yeah, that's fantastic. So before we move on to the kind of the next topic, I want to get back to, you know, what you would do differently. But obviously, like, understanding yourself better, understanding the people around you was huge. And of course, if people want to read that article by David, it's called how to use the disc profile to communicate effectively in business. And you can find out the show notes of this page of this show, biggerpockets.com slash show 319. We'll put a link to it there.

All right. So let's talk about the pre-crash. So before the crash, what would you have done differently in terms of like mechanics in your business, like leverage or risk-taking exit plans, things like that? I definitely would have had clear. I just, I literally didn't understand how to fundamentally buy, operate, and sell or hold a deal. So I literally did not understand that. So I would definitely have better fundamentals on what the actual data looks like. So that's one. Number two is I would have also had a clear process in which I started and ran the construction portion of the job. So just a simple like, here's what the expectation. This is what it looks like when it's done. By the way, that's a great question for any conversation. You know, if there's

some idea that's coming about, okay, cool. Well, this is all really awesome. what does it look like when it's done? That's, of course, the high D and me who asked that question. And then, you know, finally, I think that it was about understanding my end goal and the clear that I've been on my why and how I actually am what the goals are long term, then the more clear those things, you know, you think about that analogy of like a mile and how many steps are there in a mile. And each step gets you closer to the end game. So it's a huge long journey, but all of a sudden you're at the end, you're like, oh, wow. you know, here we are. Well, if the more clear I was on what that ending looked like or what the target was, then I would have made a lot more concise, better, faster, more clear decisions. Can you tell us what went wrong? I know people can go back and listen to the first time you

were on the show. We talked a lot about it in show number 87, but what went wrong that first time? Like, if you had to boil down to a few mistakes that people can avoid today. It was definitely a kind of a confluence of multiple things. So it was hiring a contractor who was quote unquote a business partner, working with the bank that I didn't really understand, didn't really understand the terms, didn't really understand how it worked. And then I had some bad luck. The partner didn't do what he said he would do. I didn't learn from it. And I didn't also have a backup plan.

So I kind of just went into panic mode. And so ultimately, I had just a lot of different. problems happen at once. And then I had no backstop. So as far as having savings, more in that, in that reserves. So there just wasn't that ability to ride it down a little bit. And so I tell you what, now, you know, I don't go into these deals without understanding what my timelines are and how much money, you know, what's the worst case scenario? And there's a, there's a great book in money mastering the game. I can remember who they're interviewing, but Tony Robbins asks, like, what's the number one thing that's important. And all these guys talk about it's not actually making money.

It's first not losing money. And so I'm always looking at that downside. I'm always looking at what is the worst case. I'm always thinking about not just a exit strategy, but B and C. And what actually eyes wide open are the possibilities in this deal. Yeah, that's smart. Because, I mean, things do go wrong constantly. And so we always encourage people around bigger pockets, right? It's have that exit strategy, look at what could go wrong. You know, oftentimes it's really easy to, in real estate, look at everything from best case scenario. Like when you're analyzing a deal, right?

It's like, well, you know, we could probably only have $75 a month in utilities or, you know, it's probably only going to be 5% for repairs. Like, I caution people to, yeah, think instead, like, what's the worst that could happen or jet, maybe not the absolute word. I mean, like, you could have a meteor hit the building, right? But like, generally, what's like a reasonable worst case scenario? for this deal. Run your numbers that way. See what it looks like there. And then you can run maybe more of a medium like, hey, what if it's probably okay? And then make a better decision based

on that. And again, having reserves huge. Do you have a recommendation if somebody's jumping into real estate going to buy their very first house? Let's say they want to buy just a single family house, maybe something from like your turnkey company or whatever. How much should they have in reserves sitting in a savings account to be able to buy a call it $100,000 to $200,000 rental property? You know, so if we're talking to one of our turnkey clients, I will say, you know, say the mortgage is 600 bucks or something like that. You know, I like to have six months reserves. I just, I like the safety of it. You know, so was that $3,300, something like that, even as a few thousand dollars. You know, people, you know, I remember this so clearly. So I remember buying a

couple of homes pre pre foreclosure where I didn't do the inspection because I couldn't afford it. So, you know, you're like, can you think of a dumb. A dumber response than I can't afford the inspection. So I don't know better, right? I don't know what I'm buying. I don't know what I'm looking for. I've not done hundreds of deals now. I can walk it with 95% accuracy or whatever it is.

And I cannot afford the inspect. It's just so dumb. You're smoking that hopium. Just hoping that thing turns out. Yeah, I was just wild with that hopium, man. It was, and let me tell you, it doesn't work. very well when you, you know, sometimes you get lucky, but sometimes you don't. You can say the same thing about like, I'm going to, you know, start a partnership with this guy or

girl or I'm going to raise money from this group, but I don't have enough money for an attorney to at least look over our partnership agreement. Yeah. You know, you really should think twice if you don't have enough money for an attorney to look up your partnership should you have a partnership at that point, at least like a legal one at that point. I was just telling someone this yesterday that any time you catch yourself thinking thoughts like, oh, I don't feel good about this.

I hope it works out. you should just stop like stop right where you are do not take another step and say instead of saying I hope this works out what do I need to know in order to know that it will work out or at least know what could go wrong right and that's where the skills of being an investor actually come into play like I don't know what my repairs are going to be how do I find that out and don't take action until you or someone around you that you trust can get that right like your anxiety is there for a reason your fear's there for reason it doesn't need to be your excuse to not take action it needs to to be like a warning sign that, hey, you need to figure this piece of it out. And like education,

knowledge, understanding what you're doing. Now, I bet, Nathan, when you buy a deal, you don't feel much anxiety at all. I mean, I don't think we've asked you, how many deals is your company doing a month right now? We're doing 12 to 15. We're buying and selling 12 to 15 houses a month. Right. So that's like massive success. You guys are, you guys are kicking butt. And you don't feel like, I hope this works out. Now, there's going to be elements of your business where you may get a little bit of that. But then you're like, okay, I see what went wrong and you're going to readjust it there. Can you tell us how are you finding 12 to 15 deals a month in today's market? You know, we really focused, and I think I've probably talked about this before,

but really on the relationships, because ultimately, if people know that we can execute and we actually close, then, you know, well, A, it's that. So people now know that we'll actually close. And number two is that we have the economies of scale to actually come at something like that. so we have multiple people looking at deals all the time. And then we built out a proprietary system. So literally in 60 seconds, I can plug in numbers in the back end of my system. It pops out three numbers, which are the LTV of the deal loan to value.

So my all in cost to the value, my return on capital. So what am I going to actually make with my money invested? And then the third one, which I think that we don't talk about enough, is the return to the cost of construction. And we found when we would look back and see the ones that we got our butts kicked on, we would have been really high. So let's say it was a $200,000 ARV. We get this smoking deal that's $30 grand for the house or something, but you have $100,000 budget.

So now all of a sudden you take, okay, well, the scaling and the opportunity of having something goes sideways that's a $30,000 budget compared to $100,000 budget is totally different. So that's a massive, massive difference. So we can really, we can quickly get on. something, we pay cash, we can close it in a couple days or a week or a month or whatever that that person wants. Well, I think you recognize that the construction is the riskier part of the deal because more things can go wrong than just the price you pay for the house. Like you have a really good idea what an asset's worth. So you can mess up in small ways, but there's less

variables. But the construction, there's so many things that can go wrong. So when the deal starts to get heavier on the construction side than the actual price you paid, there's more opportunity for risk. And that's just so beautifully said. Like what you did is you recognize, here's the part where I can really get hurt. Let me avoid this rather than focusing on the things that aren't going to get you hurt as much. Like, should I do this in an LLC or in my own name? And that's where a lot of people get stuck. Right. Well, and, you know, I think one point before this conversation, we were talking about what to say no and our feeling, you know, how our feelings are. And the other cool part about having those metrics really clear is that it's faster to yes, but it's also

faster to no. And people, I think a lot of times are afraid of no. And, we need to be trained that no's okay. We just have to know why we're saying no. So I think that's a massive, massive opportunity. And then, you know, people who are buying homes for us, then can say, okay, well, I know this is a no. I can see the data right here. And now I'm going to move on to the next one rather than sending out my guys to go look at it or, you know, put in the contracts and all that stuff together that takes that most important thing, which is that human time capital to go do it. Yeah, that's really good. Hey, I'm wondering, so when we're I'm talking about relationships with finding deals.

A couple questions on it. First of all, are those typically wholesalers that are wholesaling deals to you? Are you guys also doing direct mail marketing? Are you doing anything else, like specifically on your lead gen? So we don't do really any direct mail marketing. We buy off MLS still. We build relationships in our meetup. So we're definitely getting deals out of that meetup and the opportunity, you know,

to talk to people about them. And we're also looking ways to help those new wholesalers too. So like, hey, let us help you understand. understand how to comp stuff better. Let's help you understand how to price them better for you. So then, you know, we can buy them and you know how to buy for us. And the other thing is having the clear buy box. So we talk about this a lot. And when we explain so that people, they already come to us and they're like, hey, this looks like a bridge deal. Right. So they already know, like this looks like this is something you guys would buy. And so the better we do at explaining

what we buy and how we buy it in the numbers that we need to buy them at. So MLS, wholesaler relationships and then other realtors that we know and then, you know, occasionally you buy them direct from sellers, but not very often. Okay. All right. That's great. And what I like about that is that anybody can do that today listening to this. If you're a brand newbie, you can go to networking events.

You can meet wholesalers. You can tell them what you're looking for. You can help them learn how to run the numbers if they don't know how. Or if you don't know how you can learn online and learn like, you know, how to run the numbers and then help them. I mean, like, you're not doing anything to buy 12 to 15 deals a month that. the newbie looking for his first deal can't do. 100%.

That's what I love. And the other thing about this, and I see this a lot. And in our meetup now, I actually coach people on this when I see people post stuff in there. So if you just say, like, I want a deal, you know, or I want a partner, you know, that's not really, you're not bringing the value to attract somebody else who wants that. But instead, if you said, I'm looking for a contractor that I can give my time for the next two weeks on a job that's in this area, which is where I want to work. I will come and work a couple hours a day.

and I'd like to learn what your process is. Whatever you want me to do, I'll do it. And the more that you start thinking about how you can help other people, those will naturally come back to come and help you. So let's move on a little bit and talk about your, so your current business model, you run a turnkey business, which for those who don't know, it's you basically buy, and correct people wrong on any part of here,

you buy properties, you then fix them up, you make them look and function. And again, you said you focus on quality, getting them really good. Then you rent them out, and then sell them, or do you sell them to out of state investors typically or just anybody, really, but usually probably out of state? And then you rent them out, and then you manage them, correct? Like, how does that work? Okay, so very simply, and we use the two set of eyes approach.

So two set of eyes when we buy it. So on the acquisition side, and then we have a full, you know, renovation scope in budget. So really by the time we close on them, we want to have all that stuff in place. So literally if we wanted to, we have a contractor assigned. I buy it on Monday. I started on Tuesday. Okay. So that's our goal. We're not always that tight on it, but within a week or two now, we're pretty much

typically on that job. So we run the construction and we take an approach that's anything that doesn't have a 10 year, useful life or more gets fixed or replaced. So this is one of those places where turnkey really got a bad wrap and people would basically lipstick on the pig, sell it as a turnkey home. And so we wanted to kind of go against that, make sure, like, listen, not only, are we giving you the scope of work to our client, but hey, if it doesn't have a 10-year useful life or more, we fix to replace it. And then, so we go through that and complete the

construction. Then we bring in, you know, two people again. So we have two sets of eyes and we go through literally three steps. So our team internally looks at it and make sure, hey, we create the punch list, if you will. And then we send in a third-party inspector and they, you know, go through it with a fine tooth comb. And then we bring in that property manager. So by the time it comes out of the factory, so to speak, we've really done a good job of double and triple checking everything that's in there. And then we send it immediately to the property management company, take professional pictures. If you are not taking professional pictures of your rental property, stop and go start doing it now. So it's so important.

It shows so much better. You'll get more rent for it. Don't even think about it. Go spend the hundred bucks or whatever it is and go have it. done. So it's vital. And then lastly, we actually tenant that property before we sell them. So that way we know that the client, because let me tell you, we've been through some nightmare situations where we sold it at prior to. And now we can literally say, listen, Brandon, David, you're buying a turnkey from us. Don't sweat it. We're going to have the tenant place.

So by the time you close on it, it as it is truly a turnkey property in it truly is cash flow day one. Yeah, that's fantastic. So let's talk about mistakes that people make, like newbies, especially when they're buying turnkey, when they're buying from somebody who essentially what you're doing. I mean, for those who still maybe not, don't quite grasp it, you're basically flipping houses, but instead of listing them on the market, you're selling them to your private list of investors, like people who are interested in buying out of state or, again, you probably have some that are in state, but usually it's like I notice a lot of people from California or New York or,

you know, Hawaii that. So, and I want to actually give you a specific example. example too. So we've started working with this company called ADPI, Active Duty, Passive Income. And these guys help military guys specifically invest in real estate. So as opposed to going and blowing money on the brand new F150 or the brand new Mustang. So I'm personally really passionate about this because I'm always the guy who goes in the airport and is like, hey, I see somebody in uniform or whatever. I'm like, hey, thank you for your service. So now when we get somebody like that, we get to explain the basic real estate education, right?

And so we know that, hey, you are not, you don't have to be an expert in Kansas City real estate. You have to know that this is what your goal is. So you want to invest in real estate. You want to get your spouse home from work. You want to, you know, your active duty service member, and you just want to take that money and invest it in something that's going to come back. So almost all of our clients are out of state.

And we always tell them, Listen, we want to build this so that you don't have to sweat it. You don't have to worry about it. You just need to understand what kind of returns you're looking for and that long term. This is a long term play. So for people who hear this and they're trying to figure out, is this right for them? Should I go turnkey? Should I do it myself? What are some ways people can know what the best option for them would be? Such a great question. So says the high seat. So, you know, turnkey is not for everybody, 100%. So turnkey is for the person who we have firefighters, we have military personnel, we have, you know, tech entrepreneurs, attorneys, you know, on and on and on. So those are the people who are professionals. They love what they do. They have money to invest and they want to have something else besides that stocks and bonds investment. And by the way, now is an incredible time to be investing. in real estate too. If you look at the tax benefits and all of the things that are, politics aside, the current administration that we have benefits as real estate investors. And if you haven't looked at that and you're thinking about investing now is definitely a time. So turnkey is not for somebody who maybe you're real handy when you want to go in and do some of the stuff yourself and you

could do that birth strategy, the buy rehab, rent, refinance, and repeat, which is wonderful. And that's how I started in real estate. If you are somebody who you like to build systems and build teams, and we know people who have teams, I know really successful businesses who have teams in other states, but you have to be very process driven. You have to understand how to build that team and be able to invest in it. So I think turnkey is great for somebody who doesn't want to swing the hammer, doesn't want to fix the toilet, doesn't want to have the headaches of running the construction, knowing how to buy it, knowing how to rehab it, knowing how to price it, and then buying a birth strategy or whatever is for somebody who wants to be a little bit more in depth

and go through those lessons and also, you know, reap the reward of having some equity or whatever in those deals. I have an analogy that buying turnkey is like going to 7-Eleven and getting a Coke out of the fridge. Like, it's just right there, right? I forgot to grab it at home. I don't have time to go to Costco and buy it and load it up and fight traffic and get at home and put it in my fridge and wait for it to get cold and then remember to take it. That's kind of like what my method is is I want to go find those houses and do all that work. But if you're someone who's doing really well and you just know I'm not going to do anything, turnkey could be a really good option for you because someone else has already done the work.

They've taken care of the part of the funnel that's the hardest. Exactly. And the other thing about it, I think that it is nice. And obviously I sell turnkey, so it seems a little self-fulfilling. But if you're in a market that is really tough to have cash flow properties, this way, even at the number of paying, you know, retail price, you still get a really nice cash flowing asset. and you get a really stable market in like Kansas City or some of the other Midwestern cash flow

markets that are just really good, stable, great long-term investment plays. Yeah. So let's say that I want to build a turkey company just like yours. And I want to do 12 to 15 deals a month. And I'm getting excited hearing all this. What are things that people need to know, like the most important thing they got to do to get started? And if you look at your whole career, what are the, what's the thing maybe that you would have

done differently or maybe just that you realize that? is when I figured out this piece, everything else fell into place. The most important part. You know, when I started to understand myself better and what I was good at, and the more clear objectively I was about it and I stopped doing the other stuff, the far better my business went. And we went through EOS implementation. So there's a book called Traction.

And so we started to learn about like, okay, what are, what organizationally? What does the company look like? And what seats should sit in where? and then who should do what tasks. And by the way, this is stuff I hate doing. So I don't like the detail. I don't like getting in to try to understand all those tasks. But let me tell you what.

It is a game changer. And once we finally started to be able to say, this is what my job is Nathan. I am the person who creates culture. I'm the person who sets the vision and helps explain what's happening as a company. I'm responsible to help lead and show the team from the front what I should do. And so if you really want to build a team, you are only as good as you are. That's the terrifying and wonderful thing. Your business is only as good as you are.

So you have to start today with learning not only what is your core focus as your company. You want to do 12 to 15 deals? Awesome. What does the infrastructure look like today doing one deal a month or two deals a month? So, you know, administratively, construction management, how am I buying and selling deals, how am I financing them? And then what does it look like at scale? And then back to that question I asked earlier, right, what does it look like when it's built? So I have 11 full-time staff people on my team and we have three people sitting in leadership seats. And now you can start to back it up and say, okay, well, there are actually people out there who are doing that. This is what their business looks like. And then you go start asking questions right now with those people in your market or on bigger

pockets or whatever it is, go take him to lunch, harass him 52 times, and start asking the questions of, okay, this is what I want it to look like, now what? Okay, cool, I learned that, now what? And just start building out that pathway to understand what it actually looks like. And then keep coming back to that 10,000 foot view. You know, you come out to the 10,000 foot view, and then come back down to the today. And then come back out to that 10,000 foot view. And then you start to actually assimilate the information and build that bridge, build the bridge from where you are to where you want to go. All right.

So, I mean, that's really, really good. So what about the brand newie? Should they do the same thing? Should they sit down and mock up what their business looks like at the end? And then how should they treat? I mean, should they like if you were to go back and do that over again, let's say the second half, you build the turnkey company, the second half here of your story. should you have sat down and taken out a piece of paper and said, there will be a CEO,

there will be a VP of this, a VP of this, a VP, or whatever, you know, your structure looks like, or is there another way of looking at that? That's a great question. I think that's important to do that, even though it's probably going to be wrong. And I think a lot of times we're afraid to write it out. So I have a journal and it's in my bag back here. And so I journal all the time about what the next quarter looks like. And then, you know, we have five-year targets.

as a company. And so I don't know, I think people are afraid to write it down and then it doesn't happen or write it down and you have to make a change. But without having the actual vision of what you want, then how are you possibly going to put things in motion that, that are actually going to get you there? You just can't, right? It's, it's just like shooting, you're asking, you're, you're shooting into target, but there's no target, right? So you're just shooting down range, but there's nothing to aim at. So how do you know if you're on target or not? I think it was the Eisenhower, I think, said like plans are worth, planning is everything.

Yeah. Like, you know, your plans might not work out, but who cares? Planning is what gets you there. You have to plan. And there's something else like, you know, plan to fail or fail to plan or something like that. You know, it's the same deal where, go ahead, David. Failing to plan is planning to fail.

There you go. Thank you. I had many drill instructors and coaches screaming that over my career. Yeah, exactly. And so I think, and that's the beautiful thing. So if you're a newbie and you're like, okay, I really want to just flip my first home okay well that is the mission right great where are you going to buy it what price point how are you going to fund it do you have a partner if so what is their responsibility if not okay what is it that needs to happen next

when it closes what do i do i have insurance on it you know okay cool when i meet with the contractor do i have a clear scope of work do i know how to explain to them what i want it to look like if i'm putting it on the mLS bring your realtor in say okay this realtor's done on a bigillion deals in this neighborhood. They know it well. This is what we needed to look like. So just because you have some ARV of some number doesn't mean that you're going to produce that house if you don't put the intent behind it.

So, you know, we can pull it all the way back down just to have one single house as the focus and you can still apply that same concept and working through it, you know, from start to the end goal. So going to your personal story again a little bit, you know, obviously you're flipping these houses to sell to investors, which is a fantastic model. What about your personal? I mean, are you still buying rentals yourself? Are you still doing any of that work?

And what does that look like? And yeah, we'll start there. Yeah, I'm still buying rentals myself. I still buying the same area's personal goal of, you know, having $100,000 a month in passive rental income. That's what I'd like that to look like ultimately. And so, you know, I'm buying personally. I have several dozen rentals.

Our company, we're looking at some senior living stuff. So I'm really excited into 2020 to look at some of the senior living. and there's going to be a huge need for people. And, you know, all of this comes, you know, one of my big goals personally is to be able to give away a million dollars a year before I'm dead and to have it in perpetuity, and it goes to health, education, and arts.

And so I know if I have this big, fat goal at the end, that all those things in the middle, I'm just going to be pursuing a life and a business that produces this end goal that then, you know, we're able to give back. So what's the point of building this giant business and having all this stuff if you can't actually do something cool with it. So that's absolutely as motivating as, you know, making the money now.

Yeah, really, really good perspective there. So let's shift gears here a little bit and dive a little bit deeper into your real estate business through our deal, deep dive. Here's the truth about passive investing. If the strategy isn't right on day one, the returns won't save it. Multi-family real estate offers structural advantages. Many investors are overlooking, including depreciation that can help offset taxable income while cash flow continues.

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and get a $100 Amazon gift card. That's bill.com slash bigger pockets. All right, let's get to the deal deep dive. This is the part of the show where we dive deep into one particular deal that you've recently done or something in your story that we can really spend some time going over a number of questions about that property. So without further ado, let's just dive into it. Do you have a property in mind? I definitely do. All right.

What kind of, we'll start with this question. What kind of property is it? Let me and David will just go back and forth. Well, it originally started as a turnkey property. All right. Originally started. All right. How did you find this mysterious property?

So we bought it from a wholesaler, and we had a pretty incredible deal when we looked at it from the front end. How much was that deal? It was about $100,000. All right. So you got under contract for $100,000 or was that the asking? Yeah. Yeah, it was under contract for about $100,000. Okay.

How did you negotiate that price of $100,000? We have gotten pretty good at knowing how to know our numbers. So we pretty aggressively negotiate and kind of explain the values and explain. the construction. And so, you know, working through that. And so if I remember correctly, it was, it was one that was pretty easy under contract. And through that whole process, we were able to get, you know, pretty much what we had asked for. Okay. All right. Let's go with funding it. How do you fund? How do you fund this one? And then I'm also curious how do you fund all your other deals? Well, let's start with. How did you fund this one? We fund this one with,

with private money. So we've raised about six and a half million dollars in private funds. And so we helped, you know, buy and sell all our deals through that. So, yeah, it was very simple. on the funding side of that. And, you know, lots of times people use, like, their IRA money or something like that retirement funds so that they can get a great return. And then we are able to use it for the, for the buy and renovation. Okay. What did you do with it once you had it? So we began in earnest with the construction. So, and I remember now that there was actually like a foot and a half of water in the basement when we bought it. And because it was a foreclosure. And so literally you could have gotten as a big house. I think is around 2,000 square feet. You could have literally gotten in a canoe and canoed

through the basement of this house. So I'm not even kidding. So we get the property. We get multiple pumps down there, those water pumps or whatever and get everything out. No big deal. It's not the first time we'd had, you know, issues with water. And so we have, you have this, you know, full construction budget and plan and scope work and everything. So we, you know, we begin running through the whole rehab. Okay. So what was the outcome? Like what happened? I sent the story coming. So we get most of the way through construction and we're almost done, right? We have the house pre-sold now for, I think it was 200,000. And we had a really nice margin in the deal. I don't remember exactly the construction. I want to say it was about 40,000. And so come to find out,

we're literally like a week or two from selling it, from closing on it. And we're about to send it to property management, because we were sold it Turnkey. And come to find out, the house is in a flood zone. Oh. So all of a sudden, the insurance rate, right, goes from whatever would be to double or triple or quadruple. So it blows out his cash flow numbers. And he's like, I'm sorry, guys, I can't, you know, I can't buy it. So we're like, ugh, it was been like, you know, three times the insurance rate of that. And so it's just a complete nightmare. So we go out of contract. We give his earnest money back. And so we have to start figuring out what we're going to do. So we decide, okay, you know what, we're just going to put on MLS. Somebody, you know, it's a really

cool area and somebody will like to live here. And so we put on MLS. So, you know, everything else had been working fine in the house. We put it on. So we, we have a buyer, puts it on a contract, and does their inspection. So, you know, most of the things in inspection, just fine. But this one little tiny thing that it is not on city sewer. It's not on septic. It's actually on holding tanks. What did that even mean? I'm pretty sure it's like some guy had a really good idea that put like a crate of gallon jugs and then, you know, like puts it down to the ground or something. I don't know. It's not good. Not good. So come to find out this, you know, really great deal that we bought and we ran into construction and we had all the stuff and then we put on them a less. or sold it turnkey, not turnkey, now a flood zone. And now come to find out that it is not connected to city sewer. And it is 300 feet to the nearest connection.

Oh, 300 feet. That sounds cheap. And across the neighbor's backyard. Oh, even better. Yeah. So we have to get agreement from the neighbor. And then we have to, you know, run 300 feet of this, you know, sewer. line and then have the city connection, of course, which is not cheap either. And so, you know,

$20 some thousand dollars later. And so we had to bribe the neighbor. We had to, you know, send one of our staff over and make sure that talk really kindly and nicely and get them to, you know, agree to it. And so we finally, finally, finally get this thing a soul. We get the right buyer and go through the inspections. And so instead of making, you know, $40,000 or $50,000, on the flip. I'm pretty sure we lost like five or $10,000 in the deal. And it was one of those were just so happy to have it gone. Gone. Yeah. So those are definitely a crazy one. So what did you, what lessons did you learn from this one? I tell you what, we learned a lot of lessons in this one. You know, we learned from the scoping standpoint, you know, what do we look at?

And if there's any question, you know, checking those sewer lines. We don't scope every single property, but we definitely just double check. Is it, you know, all the neighbors. Well, that was what was so strange about this is all the neighbors were on sewer, but this one was not. And then we also learned that, hey, we need to stay in our lane. And it's taken us a lot of different times to learn this. But like, stay in your lane. We're a turnkey company and we do a really great job delivering great turnkey properties. But we're not, we're not a high end, you know, flipper. That's not what we do. We got lots of buddies who are great at it. But as soon as you start to veer off and get outside of the thing that you've really practiced, and not to say that we couldn't

do that, right? If we put the time and focus on that, we could solve that. But, you know, the passion and the direction of our company, we spent a lot of time in the term key. And so, you know, we had to really get back to that and make sure we were buying the things that we knew well, we knew how to operate well, and we could execute well. Yeah, such good advice in there. For anybody everybody, right me like stay in your lane as much as possible. Like, it's easy to get shiny object syndrome and start looking around for other things because it's fun. That's usually when you end up screwing up.

So thank you for sharing that. And I love, I love deep dyes where things don't work out necessarily awesome because like it teaches like even the pros, screw up. It happens, right? It does. It does. And it's okay. It's a lesson, right?

We need to use it as a tool that we learn from and not be ashamed of it, not be afraid of it. There you go. All right. And with that, let's get over to the fire round. It's time for the fire round. All right, let's get to the fire round. These are the questions that come direct out of the bigger pockets forums.

We're going to fire them at you in a nice quick manner here. Number one, Gilbert from West Palm Beach, Florida, after mustering the courage and getting out there, research and analyzing, I've been making offers, but I feel like I'm behind on negotiation. Any tips on negotiating with sellers in a competitive market? Absolutely. There's a great book out there called Never Split the Difference.

and it talks about like how you formulate questions and how you're talking to people. And so I think the more we understand what problem, not that we're solving for ourselves, but what we're solving for that seller. If you really focus on the pain, you really focus on the problem and you get to the root of it and that you're on their side and it doesn't feel like there's this budding up against each other, but rather working together, then you'll find a lot more success. Perfect, perfect. And of course, we interviewed Chris Voss on show 260 of the Bigger Pockets.

podcast. You can listen if you want. I go to biggerpockets.coms. I'll show 260. All right. Next question. Hey, oh, actually, no. Sorry, this is yours, David. Well, Chris Voss was the author of Never Split the Difference, the book that I don't know out there. Yeah, really good book. I've even seen on Chris Voss and listen to him talk quite a bit. He has some really good stuff.

All right, next question. I'm curious if anyone out there can chime in on what specific projects within a rehab produced the best return on investment, not big things like roof or HVAC. I'm talking about smaller finishes like granite countertops, flooring. vanities, et cetera. You know, I'm actually going to take it a little different route, and I was in a mastermind all weekend, and we were talking about staging. And especially on staging a home, or like earlier, we talked about the rental properties

and taking professional photography. But, you know, in the day and age now, it has to look right. It has to feel right. And so I think most people, you know, even when you look at granite, there's so many types of countertops, stuff like that that look really nice. So we really focus on, you know, staging the home and taking really great photography or like there's a thing called a Matterport camera where you can walk through the whole, you know, the whole property. So I would really think about the experience. So first of all, who is this product for? Right. So is it a tenant? Is it a buyer? Is it a high end buyer? Whatever? How does it feel when we walk in and it's our, it's a home for them? And then how are we delivering that experience to them in a way that's really good, really, really, really. well explained, visualized, whatever, through that. You do any work staging for tenants at all?

You know, we don't really do much staging on the tenant side. We do still do some retail flips and we stage every single one of them because the photography just looks way better. You know, that's an interesting question, though, is if you did a little bit of staging, like just like the, you know, towels and a few pictures and stuff like that, it's pretty interesting. We might have to test that. Well, yeah, when we first got into real estate, it wasn't. as easy to rent out a unit as it is today.

I mean, today in my market, like, you know, you just put up a Craigslistad. You got 20 people calling, but back when I got started, it was not like that. So we actually used to do that a little bit. We'd stage the bathroom a little bit. We wouldn't hauling couches and beds or anything like that, but we would do some little bit. We'd put up curtains sometimes. Just little things like that, it helped us at the time.

Yeah, today we don't do it because we don't need to. But when the need arises, how do we get better than other people? Yeah. That's how I'm going to do it. Absolutely. And you can do other little stuff, like something that smells nice in the plug-ins in the home. And you can also just the pictures make such a difference when you're looking. It's like the number one.

I cannot stress enough. Agents will come and tell people, hey, I'm going to market your house better than anyone else, right? Like there's this super secret list of buyers that no one knows about. And that is not the way it works anymore. Like everything is out there for everyone to see. You don't go to a super secret squirrel group of people. You just make your stand out from everyone else.

and when tenants are just being bombarded by all their options, and then yours look the best, they're just going to zoom in on that and go see it right away and good photographers do it. The other thing that's tricky about that question, and I love how you answered it, is people want to get a direct answer. If I put in the vanity,

how much more will the house sell for? But buyers don't make decisions like that. They're not a computer that runs through an algorithm and says, oh, you use this tile shower instead of that shower stall, I will pay $743 more. It's the feel that it gives them. them. They make decisions based on their emotions. And so if you spend a lot of money to fix your house up and you then don't change your kitchen cabinets that are just ugly and they stand out,

it doesn't matter what you spend on everything else. People just don't like it. Or if it smells bad, man, that's such a good tip you gave Nathan. Like the pictures are great, but a minute they walk in it smells like a wet dog, good luck. You're not going to sell it, right? And it's just kind of helping people understand that shift away from you can't turn this into, if I do X, I'll get why. It's more, how do I get the finished product for as cheap as I can? because that's what the buyer cares about. So, yeah, the more experience that you are, the more you start to realize that that becomes a case.

Brandon, you want to take the next question? Sure. Josh from Atlanta, I've been running into a lot of shady wholesalers. They're doing things like marking up properties 200% and then marketing those deals that they don't even have under contract. Is that normal? How do I tell if the wholesaler I'm dealing with is legit? We have had similar experiences, which drives me crazy, by the way.

You can have a contract and you can assign a contract that's been assigned. So that is legal if you actually have it under contract. but at least it is in my market. I don't want to speak for anybody else. I'm not an attorney and I'm not giving legal advice. However, this is what you need to do is you need to say, cool, one, two, three, Main Street, looks great. Are you the seller or do you have this under contract and are you assigning it?

Okay, great. Would you please send me the assignment contract along with the sales contract? And that's as simple as it is. And then you know if they actually legitimately have somewhat a property that they can sell or not. And then, you know, we just, we stopped doing business or even looking at emails, you know, getting off the email list of people we know who just send out blasts of stuff. You know, just ask them and ask around, too, because the communities are small. Real estate, you know, there's a lot of people out doing this business.

But when you get really down into the market, market specific, people know. So, you know, if you're not sure, ask around. And then ultimately, it's all about that contract because it's not going to close without it. So you might as well ask for it now. Yeah, wholesaler is a bit of a misleading title. there really is no way of defining. It's not like if you say you're an agent and you can produce a license that shows you went through a process, you know?

A lot of wholesalers are people without an agent license and don't have a house under contract. They have like nothing and they're half pretending to sell it like a real estate agent and then they're calling themselves a wholesaler to do it and you have zero protection when dealing with someone like that. So it is a little scary. 100%. Okay. Last question.

When it comes to vetting property management companies, I was listening to show 124 with Jared Sturm and he talked about reaching out to local property managers in the role of a renter rather than than as an investor with a portfolio, which I thought was pretty clever. I'm curious if anyone else can share strategies for assessing property management companies. In our business, we, we obviously, property management is a huge component of turnkey. And in any investment that any person is holding is it's actually not about you. It's not about the property. It's actually about the tenant. Because nothing else happens if you don't have the tenant paying your rent, right? Because then all the other things and benefits we talk about don't matter. So with that said, I still think it's

important to approach it from the owner's perspective. And so you want to ask about like, what is it like, how do you manage? What is your philosophy? What is the culture of your company? How many staff do you have? What do you do when it's time to market a property? What sets you apart? What's your process for that? Tell me about how you actually turn the property. So when the tenant's moving out, what is the timeline like to go from the date that they moved out? You know, how do you notify me about make ready? How do you charge? Do you have in-house maintenance?

Do you have maintenance that's not? And then also, like, understanding what are the fundamental costs of it? So, like, what's the monthly management? What do you charge to place a tenant? And then do you mark up maintenance or do you have that in-house out, you know? So there's, I would start understanding and then talking to a couple other. investors who work with them. And then also, how do I access my information? Right. So do I have a portal? Do I get a monthly email? So like my property manager, email me, my information and my,

you know, the individual itemized properties. So I can understand and see clearly and quickly what it is that that month looked like. So and then here's the last one, which is I think even the most important. So we always talk about like what that when it's good, it's easy. But what happens if there's a problem. So, you know, I would ask my property manager if you're interviewing somebody say, hey, there's a $1,000 sewer problem. What are you going to tell? You know, how is that going to be handled? When you call me, what do you tell me?

And then what is the process like and what is the expectation of me and how fast do we address it and get on the problem? Because ultimately, if you're taking care of the tenant, the tenant will be happy, the tenant will be paying. And it's all about that communication that comes back and forth between that property manager. There you go. All right.

Well, that was the end of the fire round. Now it's time to get over to the world famous. Famous Four. And now, let's get to these four questions that we've asked you three times before. This is the fourth famous four we've ever followed through on. Number one, what's your favorite real estate related piece of literature book? You know, I am going to go with a. book that has changed me on my business trajectory and thinking, but it is not technically a business

book. And it's called On the Shortness of Life by Seneca. And it really has helped me think about the direction and vision of my business, of my person, you know, of who I am as a person. And really thinking about that and applying it to my whole business. And it's a beautiful little book. I just got introduced to it. And so yeah, I love that book. All right. What is your favorite business book? I would say that I am currently most fired up about extreme ownership, which I may or may not have talked about before. But it is, I think when I think about the level and quality of books, when there's books that are around for just a couple years and are fad or to be around for

100 years, I think that book will be around and not just on business, but on leadership and on personal growth. And it's just a fundamentally fantastic book. I love that book. It's the only book. I've read Brandon hasn't and I tell them about it all the time. I've read half of it. I read half of it. I'm going to text you about it every day. I know.

I need to finish it. I just, it's so good. It was a good book. I just like I started it and then I listened to some and then I got into something else and just I need to get like a physical copy of my hand. I'll actually finish it. It's so good.

I really want to get on Jocko's podcast and talk about that book and how it's changed by business. I changed my life. Me too. I so badly want to. I so badly. And I, I train M. also. And not only is he a great, you know, writer and author, and dichotomy leadership was great, too,

by the way, but also he owns multiple businesses and has a, he's just a brilliant, brilliant guy. And super humble, which is another thing that's just basically. Super humble. You're very impressive about that guy. Okay. Other than training in MMA, which you just mentioned, what are some of your other hobbies? Well, I tell you what, train, I love to train, and I train, you know, four or five days a week typically. I also recently bought a tractor. So I love, you know, I put in like a road on my property.

So my wife and I, our home is on 11 plus acres. So we actually, you know, have all kinds of space to do whatever. And so that's a blast and hanging out with my kids and wife. And we have a creek on the property and we can do all kinds of stuff outdoors. So anything outside and being able to just enjoy, enjoy, you know, being with. the kids and the misses is awesome. All right. Well,

what do you think sets apart successful real estate investors from those who give up, fail, or never get started? So I'm going to name another book, which is the go-giver, and it's by Bob Berg.

And I think the thing that actually separates people, and I just am learning this, is a willingness to give and a willingness to actually not be afraid that we are so protective of everything that we have and we've worked so hard. but the more that you help others and then you give that that information or give that time or give that kindness away, it comes back and it is real and it's palpable and it's powerful. And so the more successful the people are, the more willing I know and see it over and over again, they're willing to help you and help others.

And so to me, that's the biggest tool, the most powerful thing in just having an open mind and a willingness to help. All right. Well, if I want to buy a turnkey property or just find out more about you, Nathan, where can people find out more about you? So there's a couple ways. I'm on most active social media on Facebook. So you can just search Nathan Brooks. It's a cute picture of myself and my daughter wearing these pink glasses. So it's pretty adorable.

And so that's number one. Number two is bridgetturnkey.com. So bridgeturnkey.com. And you can check out the properties and talk to. my team there. And then if you're, you know, local and Casey or you're coming through, then bridge meetup.com is our meetup and come and come and hang out. And you two gentlemen would be welcome any time. I'd already harassed Mr. Turner about coming out. But maybe now that you know that we have rented a theater, maybe I can get you to come. It may happen. And I'm sure you

guys will coordinate your outfits and have your little bromance going on before you go. 100%. We'll have a beard check-in. We're pretty much identical looking for those who aren't watching YouTube. We look identical. I'm a little better shape than Nathan, you know, because I trade for MMA. You know, he's got a little bit of, you know, a flab on him still. But, you know, whatever. I'm not, you know, judging.

All right. Nathan, this has been fantastic. Thank you so much. And thank you to all of our listeners today for listening to this episode. It's been fun. So thank you, Nathan. Thank you. Thank you both.

And I really appreciate you having me on and the opportunity. And you guys keep doing it. what you're doing. The Bigger Pockets is an amazing place, amazing community. It changes people's lives all the time. And so I love what you guys are doing. Thanks, man. It was a blast. Thank you. All right. This is David Green for Nathan the Bridge Brooks and Brandon Reed, half a book Turner. It's signing up. 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

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