BiggerPockets Real Estate Podcast - 367: Quitting Retail to Flip, BRRRR, and Design with Kara Beckmann

Episode Date: January 30, 2020

7X-ing her income by leaving a so-so job to flip houses! Today’s guest is Kara Beckmann, a rehabber and rental property investor who’s tearing it up in Scottsdale, Ariz., and on her Instagram page @beckmannhouse. You'll be inspired by Kara's journey from pastry chef to retail worker to full-time investor funding deals with private and hard money. Kara shares some great tips for networking with wholesalers and builders to snag deals (to date, she's spent $0 on marketing). You'll also learn how she maximizes profit by sticking to her rehab budgets, how she keeps contractors on deadline, and how she manages risk by outlining several different exit strategies. Kara's story will motivate you to apply your own "unique ability" to your real estate business and overcome the fear that might be stopping you from doing your first or next deal! Enjoy this episode, and subscribe to the BiggerPockets Real Estate Podcast so you won't miss the next one. In This Episode We Cover: How Kara learned saving habits at age 14 How she started thinking like an entrepreneur while working in retail How she was motivated by not getting a raise in 5 years Buying her first deal for $50K below asking price Reinvesting profits from her first flip Her apprenticeship with a general contractor How she develops a scope of work and deadline Why she doesn’t spend any money on marketing Her networking tips The challenges of investing without W-2 income How she prepares several exit strategies for each deal Where she gets inspiration for her designs How she sticks to her budgets (the “price per square foot” method) Incentivizing her contractors to complete work on time And SO much more! Links from the Show BiggerPockets Forums BiggerPockets Webinar BiggerPockets Money Podcast BiggerPockets Podcast 365: Ret. Navy SEAL Jocko Willink on Embracing Discomfort and Leading Through Extreme Ownership (+ His Real Estate Investing Tips!) BiggerPockets Conference Zillow Realtor.com TikTok Email: [e-mail] Check the full show notes here: http://biggerpockets.com/show367 Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 367. I would go to these open houses and I would just notice different lighting pieces that they had and different design elements that I really liked. And I thought, maybe I can do to a house what I used to do to a cake. I'm basically taking a blank canvas and turning it into something beautiful. And that got me really excited. 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 Brandon Turner, host of the Bigger Pockets podcast here with another incredible episode alongside my co-host, Mr. David Green. What's up, David Green? What's new in your world? Well, let's see. Bad news is I hurt my shoulder lifting weights. That's been a, I'm a very much. I've never really had to happen. Man, I was lifting so much weight and I just couldn't. Probably more like if I was strong, my body could handle what I'm asking

it to do instead. It's like so weak and frail. Ow, you know, it hurt so much. Yeah. So like I feel like a bird with a broken wing of like walking around with my right arm. I can't lift it up at all. But you just cracked me up because we tried to record a sample of the intro here and Brandon forgot his name.

He got to the point where he had this is and he totally blake. Yeah. It's not like a dundee show. It was like 366 times before today. Or said your name a few times in your life. Rough, rough. All right. Well, with that.

Well, the good news is we have a fantastic show today. We just got done. Oh, yeah, trust me. If you can make it through this, you're going to be very happy. Just deal with Brandon for the time being. You get through it. Today's guest is a house flipper from Arizona. She is, oh man, how would you describe it?

She's got a blue collar attitude, but a white color level of success. She gives some incredibly detailed advice. and help for how to do what she's doing. She's really come from like what we say humble beginnings. I just remember listening to her thinking, dude, anyone can do this. This is why she was like a pastry chef and then worked retail and then decided to flip houses. And she had mentioned it before the show. We didn't actually talk about this too deep in the thing, but she's like seven extra income just in like two years of flipping houses now.

And she's also getting their rentals. And she does this great story. But she guys listened to her story about like how she made it $92,000 on this flip. There was this flip she did made $92 grand. and like a ton of other real estate investors had walked through that flip first and decided that they couldn't make any money from doing it. She walks through exactly how her mind works to be able to pull out 92 grand in profit. It's amazing the story. So you're going to love that.

That's a little bit later in the show. So that and a lot of other good tips are coming up when we get into the interview. But before we do, let's get today's quick tip. Quick tip. When you take it? So today's quick tip is go to biggerpockets.com slash webinar. and sign up for webinars. So I am now doing them.

Brandon Turner has done them for a very long time. He's taught me everything he ever knew about webinars. And I am now equipped to go forward in his stead and continuing the education. I'm still doing them too. This is not my stead. Jesus. Jesus, David. Well, I was hoping if I said that, you would just have to let me do them all the time now.

Not quite true. He hasn't taught me everything he has to know. He's trying to fire me on air. This is great. We've just had a coop de grah live right here on bigger pockets. No, it's just kidding. But we are bringing different perspectives, right? So Brandon and me and the different people who host webinars,

they all have a different way of looking at things. And what we have bigger pockets want is for you to find the personality or the perspective that matches best with yourself. Because like we talk about in today's episode, experience makes money. Taking action is required to get experience. And confidence is required to take action. And we're trying to give you the knowledge that you need to be confident.

So go there, sign up for my webinar, start attending them. Sign up for the other people who use webinars you want to learn from. There's all kinds of different topics, all kinds of stuff we're teaching you. So if you love the podcast, if you can't get enough of it, if Thursday's your favorite day of the week, and then you spend all the rest of the day's crying because you can't hear and see Brandon's face and voice,

then go sign up for webinars and get yourself some food to eat during the week. Very good. Good job, David Green. Most investors spend all their time talking about their high-level returns. But that's not the number that actually matters. What actually matters is what you keep after taxes, and that's where multifamily real estate quietly stands out. With built-in advantages like depreciation, the right deals can generate steady cash flow while reducing the tax drag.

Bam Capital structures its multifamily investments around those fundamentals, pairing tax efficiency with disciplined operators and a long-term approach. This isn't about chasing hype or guessing market timing. It's about building durable, tax-aware wealth over time. Learn more at biggerpockets.com slash bam. Have you ever lost a DSCR deal because the financing just took too long? Red flags popped up late. The lender needed more time. The deal fell apart. Well, our friends at Dominion Financial just launched a program to help prevent that. With their new express rental loan, you can close in 10 days or less. And they still offer their price beat guarantee so you can get great pricing and a timeline you can count on. Fast, simple, reliable. That's Dominion. Check them out at biggerpockets.com slash dominion. That's biggerpockets.com slash dominion. Do you ever notice how every passive investment somehow turns into a very active lifestyle,

active spreadsheets, active phone calls, active stress? Here's a better question. What if you could buy brand new construction homes, 10% below market value, and the best markets across the country without making real estate your second job? That's exactly what rent to retirement does. They're a full service, turnkey investment company handling everything for you. In some cases, investors get 50 to 75% of our down payment back at closing, plus interest rates as low as 3.75%. They've partnered with Bigger Pockets for over a decade, helping thousands

invest smarter. If you want to do the same, visit BiggerPockets.com slash retirement to learn more. Now, without any more delay or chit-chat or talking or, I don't know what other verbs, synonyms for chatting there is. Let's get to today's show. Kara, welcome to the Bigger Pockets podcast. It is awesome to finally have you here on the show. How you doing? Good. Thank you so much for having me. Yeah, this is going to be a lot of fun today. So we are going to go through your story. And I know you've got a pretty fantastic story.

You know, we met in person here. I think it was at BPCon, right? Yeah, yeah, in Nashville. Yeah, that was awesome. And I got to know a little bit about you, but I didn't get that much to know about you. So that didn't really make sense. But I didn't get to know as much as I wanted. So today we're going to pick your brain, find out how you became as awesome as you are today.

And how you get to do such awesome looking rehabs because I've seen your Instagram. It is awesome. So with that, what did you do before real estate? and kind of walk us through, how did you get into the idea of doing real estate investing? So my background is not in real estate whatsoever. So I've always had a really strong entrepreneurial spirit. So as long as I can remember, I've wanted to have my own business. I didn't necessarily know what that business would be.

I just know that I didn't want to work for someone else. Sure. So when I was 14 years old, my parents said, if you want a car when you're 16, you're going to have to work for it. We're not paying for your car. We're not putting money towards it. So thankfully, they gave me a heads up. So when I was 15, I got a job at a bakery. And I worked as much as I could being 15 years old.

So I would go to the bakery and work after school. I would work most all weekends and just constantly saving up for this car. And when I turned 16 years old, I think it was that day or just a few days after I bought a car. And I thought, this is, it was so excited. to be able to buy a car at that age. And I noticed much later on in life how big of a lesson that really was. Simply, I mean, we think of saving, but it really is the art of saving money is so beneficial. And having such a strong work ethic really helped me going into real estate.

So I'm in high school and I still don't know what I want to do. and my mom would decorate a lot of our cakes growing up. And so I would start helping her do the decorating. And I thought this would be really cool to own my own wedding cake shop. So I went to culinary school right after high school. And I was saving money to eventually open up my own bakery or a wedding cake shop. And this started when the real estate market started to go down. So I would work at a restaurant for a few years.

I would work at another restaurant for a few years and they were constantly closing. And I thought, wow, this isn't good. And it was also very repetitive. You're making hundreds of the same dessert every night. And it was kind of taking the fun creativity out of it. So I ended up being a baking instructor at a retail cooking store. So now I'm kind of in retail. And then I found myself full-fledged in retail.

And years are going by, and I'm still saving. I'm still just, I have a habit of saving money. So years go by and I think, I started to become interested in real estate by looking at open houses. I would go to these open houses and I would just notice different lighting pieces that they had and different design elements that I really liked. And I thought, maybe I can do to a house what I used to do to a cake. I'm basically taking a blank canvas and turning it into something beautiful. And that got me really excited. So my mom was a real estate agent. And I started looking on Zillow and sending her listings.

And I thought, I'm going to take all this money that I saved. And this will be my down payment on a house. So how much did you save up by then? By then I had saved up almost $100,000. Wow. That's awesome. And this is years. This is years and years of savings.

So I thought this will be my down payment and also funding the rehab because I knew I had to put 20% down. It was going to be an investor loan. So I don't even remember how many offers we put in before someone finally accepted my offer. And it didn't matter. You know, I knew that I was going to get rejected. It's the name of the game. So someone accepts my offer and it was $50,000 below ask. And it happened to be a probate sale. I found it on Zillow. and I walk into this house, and it was the worst house in a great neighborhood, which is what you always want. Sure. But whoever lived in the house was in a wheelchair, and the hallway was not wide enough for her wheelchair.

So the drywall was completely gouged, and cabinets were literally falling off the kitchen. And I don't really, I see it, but I'm seeing all of the potential. And I'm so excited about this house. I'm looking at the arches and the size of the kitchen and just so much potential. And I don't remember ever being scared. I don't remember being nervous. It was just so much excitement to finally have this project to work on. So I interviewed different contractors and it was a full gut remodel.

And from start to finish, I had that project for three months, sold in 10 days. And I thought, wow, that was really easy. And everyone was saying, Kara, it is not this easy. It's not this easy. And I thought, well, that was pretty awesome. And I'm still working at my retail job. So I did another flip and it was harder. But I do have to say on that first flip, I made just under what I made in an entire year at my retail job.

Oh, that's cool. So why I didn't leave then, I'm not sure. All right. So let's dig into this first deal a little bit. I want to know just a little bit more about it. So first of all, you got it on Zillow. You found the lead on Zillow. And so you started, you know, you put the offer in.

You got it accepted. You jumped in there. Now, did you have, like, rehab experience at this point? Were you doing the work yourself? Did you hire that out? How did that work from there? No, so I had no experience. So I always, I like to say, it's okay to not know what you're doing,

but it's not okay to use that as an excuse. So I really did just interview people, interview contractors. I went with someone who I felt comfortable using, and I did the full design and I would purchase all of the materials. But other than that, I wasn't really involved in the construction as I am now. So I'm much more hands on now. Okay. And did you, I guess, how did you find good contractors in that and not get ripped off your

first time? Like a lot of people are very worried about that, their first deal. Was that just luck? I think it was luck the first time. Again, I interviewed three. Even to this day, I'll get a few different quotes. I have some contractors that are my. go-toes, but I'm still getting quotes to make sure they're not overcharging me for different

things. And I kind of went with my gut feeling on that one, on the first one. And he worked out for a few houses. And now I'm using a different contractor. Okay. By the way, there's nothing wrong with at all. In fact, when you do this for a while, you just accept I'm not going to find a contractor and ride that same horse for the next 20 years. You're always looking for the next contractor and the next wholesaler. Things change so much in business. The people that that we're working well, have problems with their family, or they get really good at their job, and now they don't want to work with investors anymore.

So for anyone who gets discouraged by, oh, I thought I had a good person, and now I don't, Kara, I'm sure you can attest. That is constant. It's like you never just find a deal source. And just go back to that place and, oh, there's another deal. You're always looking for new ones. Right. Oh, yeah, for sure.

Yeah. Something that I really loved about what you said, Kerr, was that you took skills that you built previously in life and you applied them to real estate. And I think just in general, I'm very passionate about that. I feel that more people would benefit if they would look at what they're doing well right now in life and improve it so that when they get to real estate investor or whatever they'd rather do,

they're prepared instead of saying, well, I hate my job, so I'm not going to try. I'll wait until I get a job that I like. Because you mentioned, I think, like three different things. One was saving money, built more skills than just having money. You built discipline. You learn to say no. You learn to live frugally. You learn to look for the value in something as opposed to just, well, that's the easiest one.

so let me go by that because when you're saving money, you're always looking to save. You took your skills from cake making and you applied those to real estate design. I mean, I think that's brilliant. And that is now my excuse for why I don't have an eye for design. I'm just like, well, I wasn't classically trained in how to do cake. Yeah, make cakes. So that's why I don't know what I'm doing because I've seen your work and it is extremely impressive.

You are very, very good at that. And to think that you learn to do it from the skills that you built with something as, I don't want to say simple, but maybe basic as a cake, it's not as complex. That's so encouraging for everybody else. You may be, I just work at a bank underwriting deals. How could I ever be an investor?

Well, that's a freaking skill that works really well when you get into investing. So work on sharpening it. And then you also mentioned that you didn't like the uncertainty of working for someone else because these restaurants kept closing.

And so that created this drive in you that, no, I want to learn how to provide for myself so that I'm betting on me and not other people. And every one of us that's listening to this has similar experiences in life that if we take that attitude you took, we can have a similar result. Right. Yeah. And going back to saving money, real estate investing is like a financial roller coaster. So if you do not know how to manage your money going into this,

if you sell a house and you have a huge check, if you don't know how to budget that money, it's going to be a tough ride. So before you get started, I really think saving money and learning how to budget is so important in this industry. Do you have any tips for people who are starting with that because a lot of people listening right now are saying, well, you know, Kara, I make $3,000 a month and I spend $3,000 a month. So what am I going to do? I'm, you know, this is just where I'm at. I would start writing down what you're spending your money on. I think even simple things go so fast. So you're spending $5 here, $3 there. It adds up at the end of the month. So just by writing down what you're spending your money on, I'm sure there's budget apps too, you'll start to spend

unless because of that, you'll see where your money is going. Yeah, that's smart. And then also don't buy something if you can't afford it. You know, we have credit cards. And so it's so easy to put something on your credit card and think, oh, I'll pay it later. But if you cannot pay off your credit card at the end of the month, you have to cut back. Yeah, it's pretty amazing just by, like you said, write it down. It's such a good tip.

Like when I was really struggling with debt back when I was like in my early 20s and I was spending way more than I was earning, like just the act of writing down and knowing where my money was going instantly made me say of like, almost $2,000 a month difference of what I was spending versus not. And like, I didn't even have to get all weird about it. And like, I mean, I got weird about it. We got like envelopes and stuff and gave ourselves a budget. But like I didn't have to like go and like eat out of a trash can or anything weird like that. It was just knowing where my money was going.

I didn't notice a lifestyle change. I didn't have to drive a worse car or anything. It was just knowing where it was going is amazing. So anyway, that would be my advice as well. And of course we have an entire podcast, like an entire show, multiple episodes, whatever. I don't know, to 100 episodes now. of Bigger Pockets Money. So if people are listening to this and they're like at that phase of their life where they're like,

how do I save more money? How do I make more money? The Bigger Pockets Money podcast is an awesome show with Scott and Mindy. So definitely check that out. Now, Kara, from here, you're talking about you saved money for the first deal. You made some money on it. You took that profit and you went and bought a Maserati, right? What was your plan with the profit on that first deal?

So I didn't take any money out of that profit. I turned, I saved all of that profit, turned it into another house. So I, to this day, that's what I do. So I still haven't really pulled out any of my profits. They're constantly being compounded. And after that house, I did another flip. And then I thought, okay, I really want to do this full time. I'm enjoying this.

I love it. But I was so scared to quit that steady paycheck. I had been working since I was 15 and a lot of times working two to three jobs at the same time. So that was a true fear of mine. So I thought, okay, before I leave this study paycheck, I want to get a rental property. So I have some form of cash flow coming in. So by word of mouth, I was able to purchase a off-market rental property near one of our biggest universities.

So that's been a great rental. However, I was supposed to finish renovations on that during the summer. And my renovations went past the start of the school. So that was vacant for about four months. Oh, okay. So that was not fun. And then ever since then, we've gotten on track with the school year, but it was nice that I was still working full time because I was able to afford those mortgage payments. So I'm really happy that I started doing this working full time because I was able to basically use my day job to fund my side hustle at this point.

Yeah. So that was pretty big for me. And I was also able to qualify for mortgages because I was working full time. So that helped a lot. So now I have a rental property. And then on my third flip, but my fourth property, I thought, if I'm going to do this full time, I need to learn more about construction. So this house was really pivotal for me.

I hired all subcontractors to teach me how to do everything. So my electrician taught me how to wire can lights, switch out all of the receptacles, GFCIs, demoed. I was involved throughout the whole demo, ripping out toilets, kitchen sinks, painted that entire house, removed popcorn ceilings, you name it, I was doing this. And I would go to work with paint on the top of my hair and drywall on my arms because I was at my project for so long. Like every day I was there a little bit longer. And then I would go work full time after that. So this project, as you can imagine, took a long time. It took much longer than hiring a general contractor.

And I was still nervous to jump into this full time. So I started applying to different jobs that were a little bit more in the industry. I applied for a job at a tile showroom, and I didn't get that job. I applied to work for a local builder who, it was a very entry-level design position. and I didn't get a call back. He simply said, no, you don't have enough experience. And ironically enough, we actually have a house.

I have a house on the market now, and he's finishing up a build just catty corner. So I know he's going to use my comp, which is really funny. But I kept getting all of these nose. And at this point, I've been at my retail job for almost five years without a single raise, no raise at all.

And rather than taking all of these nose and getting turned down. And rather than looking at that as people putting their worth or, you know, telling me what I'm worth, it almost motivated me. It motivated me more to, okay, I just have to do this. So with a huge leap of faith, quit my day job, finished this house. And I made the least amount of profit on this house, but I learned the most. I learned so many lessons on this house.

What, I'm curious like, you know, this, I love the idea that you wanted to learn how the, the construction side worked and you wanted to get in there. Are you glad now you did that because you learned all the skills? Like, well, how does that benefit you? And for those people listening, how would it benefit then to learn just the basics of how construction works? Oh my gosh. It was huge.

It was absolutely huge for me. And then going into the next project, I learned, I took a lot of skills that I learned and applied them to the next project. I just can't even stress enough how important it is to, know, even to have just a general knowledge of what your contractors are doing, anytime I leave a job site, I make it a habit to ask subcontractors a question. And so you're walking away with an education. So even if you can't work at a job site full time, it's so important to ask questions.

Yeah. Yeah, that's really good. People ask me this a lot. They'll say, how much do I have to learn about this part of investing? Appraisals. Construction is obviously a big one. that comes up a lot. Number crunching.

And what I'll usually tell them is you only have to learn as much as you personally need to feel confident. If you're somebody who just, you know what? I have the basic gist of it. I'm good. Then focus on the thing that you're really good at or focus on getting the deal and you're good. But if you know personally, until you know inside and out what they're doing, you just won't

take a step forward, well, then that's how much you have to learn. And it sounds like for you carry, that's kind of what it was, is you got in there, you got your hands dirty, you learn how to wire some things. I would guess from what you've shared here, a bit of a perfectionist that you like things done at a high level all the time. And so people that have that wiring need a little more insight and hands-onness with what's going on to feel comfortable. But once they feel comfortable,

those are the ones that are the most successful because they have a high standard and they drive really hard. And that's what you did. And you haven't said, I demanded that they pay me for teaching me something, right? Or I went in there and I said, I'm not going to learn. I'm not going to work for free.

you jumped into the world that you were maybe obsessed with, isn't the right word, but very interested in that you wanted to learn more about. And you played around in there until you felt comfortable. And then boom, you started flipping houses. And it really can be that simple. It doesn't have to be something where everybody needs the same step-by-step thing to follow. I'll hear people say, do I need to get my real estate license? Do I need to get my general contractor's license?

Hopefully you don't need that much reassurance that you can just have someone show you how they wire a light. You know, okay, I get it now. Right. And I think even just knowing small things, it builds your confidence along the way. Yeah, that's very true. And that confidence is what matters, right? Because when you feel confident, you will take action.

And taking action is what Brandon and I are constantly telling people, this is what's going to build your wealth. This is what's going to make you successful as taking action because that's where you learn. Right. Yeah, for sure. All right. So what happened next? So you quit the retail job.

You jumped in full time. All smooth sailing from then on? What happened next? Oh, my gosh. As soon as I quit my job. So now I have to get hard money. I can no longer get these loans, obviously. So now I'm using one of the most expensive forms of getting money.

So I get this house. And it was built in 1955. And I think this is going to be great. It will be just an easy flip. And it was my hardest deal to date. Everything that could have gone wrong went wrong on this property. And I, so, okay, so I have hard money. I have to pay this loan back in eight months.

And I think, oh, this will be a piece of cake. Easy. So we start doing demo. And one of the main things, I think it might have even been the top line item on my contractor's bid was to pull a full remodel permit. So I think, okay, great, we have the permit pulled. I paid for it. And we're into the remodel just enough where the dumpsters are gone. we're starting new framing, and so we're pretty into it.

And then we get shut down by the city. Oh, no. And my contractor calls me and he said, we got shut down. Something's wrong with our permits, but it's okay. We'll get it fixed. We'll get it all figured out. Four weeks go by. And it's a stop work order.

Nobody can be on the job. And I'm paying hard money. So this is costing me a lot. And so now we're back on the job site. And it turns out those. permits were never pulled. And my contractor hits me with a $40,000 change order. Because now we have to redo concrete, redo framing, redo electrical, redo some plumbing. And he's saying, if you don't pay this $40,000 change order, I'm pulling everyone off your project. And I said, I'm not paying anything until

you'll meet me at the house and we'll talk about this. So we meet at the house and basically there a few change orders that the city added on like hardwiring smoke detectors. So those kind of things. I said, yes, I'll pay for that. Absolutely. But a lot of this boils down to if we had had those permits in the beginning, none of this would have happened. We would have had inspectors on site. And that was such a tough lesson to learn. So now I will either pull my own permits or now if I don't pull my own permits, I'll make sure that they were pulled going on the city's website. Yeah. So, Now it's, we're finally done with this remodel. There were a few other things that came up.

They removed the wrong exterior wall. I walked on the top site as they're just finishing, taking down some masonry. And I'm like, oh, my gosh, no. So they were just quite, that was a tough one. And now it's under contract. And the inspector for the potential buyer scares the new buyer by saying there might be a subterranean leak and I did this polished concrete floor, this beautiful polished concrete floor, and then Spector is telling the buyer, yeah, you might have to rip all of this up in the hallway.

And I'm thinking, why would, why would you say something like that? And it turned out, it was a leak in one of the exterior landscaping valves. Oh, no. And it just totally ruined the deal. And so a few weeks go by. It goes under contract again. And it closed two weeks shy of that eight month. Oh, how about you were sweating? Yes. What was the plan? If it didn't go, what were you going to do?

If you didn't get it done. You know what? That didn't even cross my mind. I just thought it has to sell. It has to sell. Yeah. That was such a tough house. And I just thought, well, I don't think any other project could be this hard.

Yeah. There's so many things you can learn when you tell stories like this. I love listening to like these case studies. What you just had me thinking about is, it was a success for you because you got it sold. It was a big win for the buyers of it because they got a great house. The losers were the people who backed out because their inspector told them, you might have to rip out all of this beautiful floor because of a leak that had nothing to do with the house.

It was from outside of the house. And it just had me thinking as an agent, this is why I'm bald because my hair's all been pulled out of my head. How many times that will happen, right? Just real estate agents that are not good, which is in my opinion, most of them, we'll hear that and think, oh my God, we have to back out without ever thinking, well, what would we have to look into to find out why it's really leaking? They won't look deeper. They won't take more of an effort. They just feel the emotional fear of, oh, my God, there's a leak. This could be a problem. And they run away as fast as they can, which left the deal wide open for the next buyer,

but those people lost. And so the lesson to take from it is when you feel that fear, when you think, oh, there could be a problem. Don't just stop. Ask the inspector, well, how would we know why Either it's leaking. Actually, I don't know. I just find leaks. Okay. Who do you know that would know? Right? And then you find the person who actually understands this stuff and they say no, no, no, it's just a problem from outside and you get a good agent who says, well, we're going to negotiate as if it's a problem with the house, but we're not going to worry about it because it's a problem from outside. We're going to get some money off of what the seller's asking for, something like that. But just don't assume like worst case scenario and just that's it, right?

Do a little bit more due diligence because that first buyer lost a really good deal over nothing. Yeah. And I'm sure, Brandon, you've seen this all the time, right? I mean, we had a similar issue with your house in Hawaii that we were. looking to buy with the loan issue like you weren't able to get the loan and thank God you're not the kind of guy who goes oh guess the whole thing can't work my loan won't works well what do I got to do to make it work so that's and Kara I just notice you you have that energy about you that you are that kind of person that doesn't say I can't do it that says well what would I have to do to make it

happen and and we stress that a lot because we see that so often from successful people that trait yeah for sure for sure there was actually right with on that topic there was this house that a wholesaler brought to me and I didn't know how I was going to fund that house, but I knew it was such a good deal. And so I put it under contract. And yeah, luckily, I found the funds to, yeah, you just figure it out. Yeah, I'm such a big believer in the whole like jump out of the plane and build your parachute on the way down. Like, you're like, well, I got all these things here. I'll figure it out. I mean, that was kind of the premise of the book I wrote the book on Invest in Real Estate with no and low money down, the longest book title in history. It was like, here's all the pieces of the

parachute so at least you can jump and then you have the parachute pieces you can put it together and hopefully you'll be all right because like you don't know until you jump like what you're going to encounter so uh right and i like that you pointed that out because so oftentimes when i hear that what i think is you're going to jump out of the plane and find the pieces on the way down and then assemble them but that wasn't the case right you did your research you had the parts you needed it just wasn't 100% there yeah and also on that note kara i want to ask you that question but you quit your job at that point, you know, before that deal and you jumped in. Do you feel it was the right time to quit your job? Do you think you quit too early, too late? And then I'm just wondering, like,

what kind of advice do you have for other people who are in that same spot where they're like, ah, I'm making some money in real estate or I, you know, I'm close. I'm not sure if I should quit or not. Like, what kind of advice you have for them? Yeah, I don't think it was, I think it was a great time to quit my job because all of the experiences that I had had kind of helped me get to that point, even though that was the hardest house and I really couldn't have prepared myself more than literally just jumping in and figuring it out. And I think as long as you have a little bit of experience going into it, I wouldn't necessarily recommend quitting your job and trying to flip a house. I would get some experience under your belt and just know that every project is going to have

its own set of difficulties. And you have to mentally prepare yourself for that because it's going to happen. And sometimes if I'm in a really tough project, I remind myself that this will come to an end. And it always does. You know, eventually the house will sell or you'll get through the renovation. So yeah, but really you just have to do it. You just have to jump in sometimes and figure it out. Yeah. Brandon, do you find that you often have to have similar self-talk to get yourself through those emotional spikes? Like, this is going to end. It will be okay. Yeah. I may lose on this deal, but that kind of stuff. Yeah, you too. Oh, it's like, I think when you're an entrepreneur, yeah, you have, first of all, you have entrepreneurial bipolarism. Kara, can you relate to this where you think like, you, yeah, there's nothing I can't do. In fact, I'm going to go do this thing next. And like, Elon must better be careful because I'm on a role. And then literally the next day, day, you're like, I can't show my face to the public. I'm such a sham. They're all going to see through

me. I suck at everything. I should just beg for my job at the bank back and see it. Right. I will eat ham sandwiches out of the dumpster like what Brandon was saying. And then two days later, you're like, back in business. We got another one in contract. I'm a genius. And so that's part of being an entrepreneur that makes you feel crazy. Then you have like the schizophrenia where you're talking to yourself like, nope, you can do this. That's okay. Brandon says he messed up on a deal too. Hang in there. And this is going to end. You just learn something, right? Or, hey, don't think that you're a big deal.

That can also happen. You'll get a house and, like, the ARV could be up to 800,000. And I was planning on 700,000. I'm going to make 150 grand on this deal, right? I should be teaching my own course. And you got to talk to yourself, like, hang on. You don't know that's going to happen, right? It's not just me.

You guys have the same issue. Yeah. Definitely. All the time. So everybody who's listening, yes, thank you. Like, keep that in mind that being an entrepreneur comes with a small degree of craziness associated with it. It's normal.

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. Bam Capital builds its investment with that reality in mind. They are focused on solid operators, tax efficiency, and long-term performance. For investors who want real estate exposure without being landlords and who care about consistency over hype, this is a smarter way to allocate capital. Learn more at biggerpockets.com slash bam.

People love to call real estate passive income, which is interesting because most of the investors I know are very busy. Busy finding deals, busy managing teams, busy worrying they pick the wrong market. Rent to retirement flips that model. They help investors buy turnkey new construction homes, often 10% below market value in top rental markets across the country. Their local teams handle the build, the property management, and the details, so you don't have to. In some cases, investors even receive 50 to 75% of their down payment back at closing, and there are interest rates as low as 3.75%. They've been trusted partners with Bigger Pockets for over a decade, and if you want to learn more, visit BiggerPockets.com slash retirement. Tax season reminder for all

the real estate investors listening. If you own rental properties, short-term rentals, commercial buildings, basically anything that's not your primary residence, you need to know about cost segregation. It's an IRS compliance strategy that lets you accelerate depreciation on your properties, which means you're paying less in taxes this year and keeping more cash in your pocket for your next deal. Cost segregation guys is the go-to firm, having done over 12,000 of these studies with $500 million in total depreciation identified. Head to costsegregation guys.com to get a free proposal and see your potential tax savings. Wouldn't it be great if you're house plants paid rent while you were out of town? I mean, they've got the whole place to themselves,

lots of sunlight, zero responsibilities. But no, they just sit there waiting for someone to spray them with some cool mist like a bunch of leafy loafers. But guess what? Your home actually could be earning you money while you're not there. Airbnb has a great feature called the co-host network, which makes hosting your home so easy. If you live far from your property or are away for extended periods, you can hire a local co-host to take care of the hosting for you. These co-hosts are vetted locals who already have experience hosting on Airbnb. A co-host can handle all the details like messaging guests, creating your host space, and managing reservations.

So everything runs smoothly. It's a practical way to earn a little extra money, maybe even some cash toward your next trip. Plus, you get to share your place with someone traveling to your area while you're off making memories somewhere else. Your home might be worth more than you think. Find out how much at Airbnb.com slash host. So Carol, let's go back to your story.

So at this point now, you're into the flipping thing full-time. You're doing it. Did you ever go back and get another job again? Have you been, have you been full time since? And then give us a time frame of how did all this happen? Yeah, I've been doing this full time now for two years. And so I have never looked back. And even my toughest days, I'm so, so thankful to be doing what I do. And yeah, no, I've, I've never looked back and I don't have a second job. This keeps me very busy. That's great. That's awesome. So you're flipping full time. Now, how many have you done now in the last two years and since then?

Well, total I've done 11 deals. Okay. But it's funny, I have an Instagram account too. And so when I started, right when I quit my job, ironically enough, my Instagram page started growing as well. So I've been taking on a lot of client projects as well. So I will help them with full house remodels, kitchen remodels, bathrooms. So that's kept me very busy too.

Look at you, Joanna Gaines. That's awesome. I actually would love to do that someday. I mean, I have no time for it right now, but, man, I would love to, like, just work on other people's projects where, like, I don't, I can do the fun part, the rehab and, like, guide the direction, but not lose money, like, have the risk. That's what being an uncle feels like. Oh, there you go. I show up. I play with Rosie.

She laughs. Then she's in a bad mood and I give her back to you. And I'm like, here you go. You can have her. That's exactly it. All right. So you've done these now. You're obviously, I mean, I'm sure you're making more than you were at your previous, at your previous job.

And what's the future look like? I mean, where are you headed? Do you're just going to do more and more flips in? can get into rentals, more rentals? Yeah, the one, right? So I have three rentals now. Okay. So I do want to continue to grow my rentals. And I still love the fix and flip model. I have a lot of fun with it. And so I want to do continue to do that, but also get more into multifamily as well. So the multifamily would definitely be buy and holds and just grow my rentals. So my goal for next year is to have seven additional rental properties. So a total of 10 by the end of next year.

Okay. That's awesome. And now how? How are you finding deals to get your deal flow? You mentioned wholesalers earlier and a Zillow one, but what else are you doing? So I still find 90% of my deals on the MLS. Really? Where, what market that way are you in? Oh, I'm in Scottsdale, Arizona. Okay, so it's like a big market and you're still finding MLS deals.

Like, yeah, it's a big market. It's very competitive. What are you looking for? And, well, I have my certain areas that I invest in. So the reason I like investing in specific areas, I can run the numbers really fast. I know what a good price per square foot to purchase in is, and then what I'm going to exit at as well.

So I can just, I know those areas so well. Six of my flips were in like about a three mile radius from one another. So I look for that. I look for ways that I can add value on a few different homes. I purchased them as like a three-bedroom home where I was able to convert it into a four-bedroom. I did that also with a two-bedroom home. I was able to add a third bedroom. So looking for opportunities that other people are missing and just putting in offers.

You never know what someone's going to accept. Yeah. You mind if I bring an agent perspective into why I think this works in Scottsdale? Yeah. From the long distance perspective of where should you invest? This is working really good for you, Carrot, because in Scottsdale, there is a big discrepancy between home prices. You could have a house that smells like cat and dog food that sells for $350,000.

And in the same neighborhood, an upgraded one can sell for 525 to 550 because of where your price points are and you're dealing in a more affluent area, there is a very big discrepancy. People that have a lot of money will spend a lot more money or really borrow more money to buy a house that's already fixed up. Whereas if you're dealing with houses that cost $60,000, maybe the spread would be between 60 and 70. It's very hard to make that profitable than, you know, when you have six figures in between. So you can buy houses in the MLS when you have an eye for what you will do to add value. And that's exactly what you said, adding bedrooms, adding bathrooms. Obviously, you have a rehab background. So for people listening that would think, well, I can't invest in

Scottsdale is too expensive. That's a good thing if you're looking to go in there and add value. If you're looking for a turnkey thing, that would probably be harder. It's going to be harder in those higher price points to just walk in and buy something and make money. Do you want to comment on that? Yeah. Well, I mean, for Scottsdale, too, we have a really good Airbnb model. We have so many events going on and our weather is really nice in the winter. So we have a lot of great months where you can rent them out too. So having different exit strategies, I think is really important. So if for any reason I'm not going to be able to flip the house, I kind of know in the

back of my head, okay, if something goes wrong, I can always hold this property. Yep. I love that strategy. I mean, I make this comment a lot that I'm not afraid of a recession. I'm not afraid of not being able to flip a house correctly because the market changes, but I'm always preparing or asking myself, Well, what if it does happen? What if a recession does happen the next six months or it starts while I'm in the middle of those flip?

And I want to make sure I have a couple options. An Airbnb can be a fantastic way to say, okay, well, if it doesn't sell or I can't get the right In fact, I got a condo that I'm working on out here in Maui. But I'm like, you know what? Like the comps are like, since working on this project, the comps are like, are dropping. And it's not exciting. Like I'm like, oh, man, like every time a new sale goes, it's a little bit less. And I'm like, there goes my profit every time.

But I'm not worried because I'm like, okay, well, if it doesn't work, it's zone for vacation rental, so I'll just vacation rental it for a while and get the profit again someday. So yeah, that exit strategy thing is smart. And I find Maui similar to probably Scottsdale where a little bit higher price point where like David, you said, there can be a little bit more spread there where there's a little bit more emotional ability. That should be a... Volatility. Yeah, emotional volatility. That's a good word for it. We're like, I mean, yeah, when I bought my house, you know, like when I bought my house, like it was like $1.7 million. Right. What I paid $1.8? Probably. I mean, or

1.6, like, it's all just a big number at some point. And I love the house. Yet, if I was at, like, $60,000, would I pay $160 for a house? No way. Like, that's $100,000 difference. It's crazy. But at the higher price points, now, I don't think Scottsdale's, you know, one and a half million for most of the houses you're doing. Are they or what kind of price range are you in? No, I'm, I'm usually entering in the 400,000s and exiting, I don't know, mid five, sometimes mid six, depending. Okay. I'm wondering, what's the most difficult part? today for you of flipping houses. Like, what do you struggle with the most?

It's a really good question. I'm a good question asker. I've done this several times. I was thinking the same thing. Like, wow, Brandon, every once in a while, you just come along. Totally redeem yourself. Some people are like, they have like this, you know, what's really, really difficult

for you or just one thing that just weighs heavy on your soul. You're like, oh, I just don't like doing that. It's something that I might be like, what's the best part? And for other people, it's like the opposite, you know? So I'm always curious of what, like, what do you just get a lot of joy out of? one of you just not enjoy doing? Well, I really enjoy a lot of it. So I think probably, okay, I know what it is. I'm very picky on the deals that I'll take. So I look at a lot of deals and I say no to a lot. I'll say yes to a few. So probably taking on more deals at a time. Like if I wasn't as picky, I might be able to do more deals.

Okay. So that's the toughest part. But once I find a deal, it's usually pretty good. I'm taking it on because I think it could probably be a pretty quick rehab and yeah, I don't know. Okay. Well, how about this one? I'll expand on that a little bit. How big is, on what you just said, how big is too big of a rehab? Like, would you do a $300,000 rehab where you have to go and spend $300 grand and, you know, spend nine months working on it?

Or are you strictly paint carpet? Not right. Yeah. I wouldn't take that on right now because I don't know necessarily what the economy is going to do next year. So I'm doing more quick fix and flips. But no, we've done. rehabs where they are over 100,000 and additions and that type of thing.

But yeah. Okay. All right. And then finally, I'm wondering like in the future, like, do you plan I'm building more of a team around you and who do you have right now in your team? Or are you running everything or do you have employees yet? And what is that like now and where do you see that growing to? I definitely want to hire more employees.

I want to hire someone full time, especially to help me more with the design, the client-facing aspect of it. Right now it's, it's pretty much me. And then I have some part-time employees as well. One of them being my sister, which is so nice, she's finishing up design school. So that's so great because she can do my CAD rendering and sketch up. So that's really nice. But I definitely need to build more of a team so I can do more projects at a time. On that note, I'm wondering, you said she can help with some of that stuff. And you obviously have a lot of skill. I mean, I've seen your Instagram. It's awesome. Like your houses look great. Where do you get your inspiration from? I mean, are you, like, how do you decide, I'm going to do this color, this design? Because

like, you got a very, like, unique, really cool looking style. What do you get it? Oh, thank you so much. You know, it's funny because every house feels a little bit different to me. And I like to kind of, like if the house has a certain structure and I kind of go off of that, I've done a house where it had a very modern Spanish feel. And so that's, I kind of ran with that. But I definitely like trying new designs. So it's not something that I could make a design for before I have the house. I just, I couldn't do that. And I love traveling. So I get a lot of inspiration from travel and especially with tile patterns and colors, that type of thing. But I get a lot of inspiration from even restaurants. There's a lot of cool restaurants here and it's unique things that I like to implement into my designs. So I think it's just fun to try new things.

Do you have any advice for Neanderthals like me that just don't pick up on that at all? Yes, probably just hire you. Just, yeah, hire me. Call me. I actually think that idea that if you suck at design or you don't like design, yeah, there are people out there who that's like their favorite thing in the world to go help you design your property. So like that's what those roles that should pay for itself like 10 times over. You hire the right person.

I'll tell you how I've overcome that because I literally feel colorblind. Oftentimes when I'm doing a rehab, I just know what would look good to me, but I have zero faith. Until I became an agent and I saw enough homes, and then you just get this generic idea of what to do. But anything outside of those lines, I'm not confident that what I like is what people would like. I ask people, when they hear I'm interested in real estate,

what you look for is a person who says, oh my God, I love real estate. And I would say, why? And they say, I've always wanted to be a home stager. Like, why anyone wants to be a home stager never makes sense to me. You don't make any money doing that. That's like the hardest thing to do. But now when I'm like, oh, you're the person that I need to walk through

my flip and tell me what color that should be, what material I should use. I saw you smiled, Carol, and I said, have you come across people that are the same way? No, but I enjoy staging my flips. Yeah. That's funny. Yeah, there you go. But I would say, if you really have no idea what to do, don't do anything crazy. Just keep it simple because a lot of home buyers will be able to kind of imagine themselves

living there more if it's simple. Yeah, so good, so good. All right. Well, maybe one of my last questions before we kind of move on. I'm wondering about like managing these rehab projects. Can you walk us through kind of your process? Like what does that look like in terms of do you create a detailed scope of work? Do you use some kind of software for that?

Do you just have an Excel document and then do you give the whole thing to a contractor? Like what does that look like on a broad scale of how you handle it to make sure you're not over budget over time and you get contractors actually giving you good bids? Yeah. So the budget and the timeline are so important to me. So when I'm walking a project with the contractor, once we have the deal, we'll determine a date that's fair for both of us for completion. And this has kind of been something new and it's worked out really well.

If we go over that completion date, I'm charging him X amount. It's coming off of his final bid. And then on the contrary, if he finishes early, he's getting bonus out each day that he finished early. there's an incentive on both ends and that's worked really well. And then as far as budgeting, I pretty much know going into the project how much I'm going to spend per square foot. So that's based on the typical finishes that I use and that's kind of evolved. So that also just kind of comes with experience and knowing what things cost. But those are really important. So I'm always staying on

budget by doing my Excel spreadsheets. And those I just simply do on on Excel. And those are always up to date. Yeah. That's fantastic. I'm so glad you mentioned that technique about paying them extra when they finish early and having it worked out contractually to where they're going to have to take less for being late because that's the same way that I do it.

And I get a lot of people that come to me and they say, because I'm sure you get the same thing, help. I'm in up to my neck. The contractor's not returning my call. it's so horrible. How do I fix it? It's really hard to fix it now, you know, like without going to court. It's better to have set it up in the beginning to where that person said, it will take me eight weeks. It's probably going to be six weeks. Eight weeks is worst case scenario. And they agree in writing to if it goes past eight weeks, I will not charge you for this or for that and then

don't pay them until it's finished. And then on the other side, if they keep their word, pay them extra. Bonus them. Give them an incentive to get done. Because you're saving so much money, not paying hard money that you can literally bonus your contractor and still come out ahead. Right. Right. It's so true. So I tried to do this one time and I mean, I've done a number times, but one time in particular I learned a lesson is that instead of giving them like a charging them a per day, it was like, hey, if you get done by this date, I'm going to give you a, it was like a $3,000 bonus to get done by this date. And they didn't get done by that date. So the day after, they stopped working on the project and didn't show up for like six weeks. Just never shut up again because all of a sudden they had no incentive anymore

to get it done on time because they didn't hit their thing. So then I learned, yeah, do the daily thing. Like, hey, I'm going to charge you $100 per day, either direction. You get it done faster. You get an extra $100 per day or whatever that works instead of a chunk because then they just walked out. And that was that project took so long.

They just would not show up at all because I became the lowest priority in their life. Then you're like, I'll give you $3,000 just to get back on my job. Yeah. I'm like, let's put another bonus back in the game. The only way I got them is just like just nagging them every day. Like, where are you? What are you doing? You would have had to not pay them very much up front so that they're just trying to get.

But usually they want like 50% up front or something. If that 50% was enough to make them profitable without going back to your job, then yeah, you just entered into this no man's land. Yep. Where you're kind of stuck. And actually the other problem with that deal was that I was paying the guy, you know, basically, yeah, a good chunk up front. And then I paid him throughout the project at a different benchmark.

So the last final, like, I mean, it was only like, there was maybe like 20 hours of work left at the end. They just took six weeks to get in that, finish that 20 hours of work just because they had no incentive. So there's only a little bit of payment at the end. And I learned also that lesson is always you need to be ahead of the contractor, like significantly. So like if, you know, he was having what, a thousand dollars at the end? Not a big deal when he can go make 12, 12 on a roof. But because he, you know, if he had had $15,000 left, he would have showed up and got that done in two days with, you know, a couple guys. And lesson learned.

That's a very, yeah. And see, that's why you're not discouraged because you just looked at it like Jocko would say. You owned it. And you recognize, yeah, I didn't set this up the right way next time I will and then you'll be good to go. And it is always my fault. Like I really believe like every kind. And I'm not just saying this because of Jocko or because of extreme ownership or like it. I can literally look back at every single problem I've had with a contractor ever and said that that's my like I can clearly see where it's my fault.

Yet I still make the same mistakes over and over. Yeah, I agree. It's always. everything else too. I wish that you would let me help you more. That one time we're in Hawaii and I just took the phone out of your hand and I'm like, just let me do this. Yeah, but I think, see, now I need to own that I should do that more

because Brandon doesn't want to just lean on. You need to just fly out here and come help me work on some flips out here. Well, that's why I have Greg now. Greg is my like flipping partner and he's like just out there talking to contractors and doing all that. I don't, I'm not good at. So it's great. God bless you, Greg.

Karen, I want to ask you something because this is just, I've known you for a little while. I think did we also meet a Nashville or did we know? No, we knew each other because you brought value by connecting me with the lender that you thought would help refinance some of my single family rentals. Oh, yes. Yes, that's right. Okay. I just got scared that that might have been somebody else and I would have stepped in it right there. So that was like a really smart and cool thing that you did for me. And I just emailed them while we were talking to restart that conversation with my assistant Tanner. But I want to say you are clearly skilled at many things, but one of them is networking. That's, I mean, all the stuff we've been talking about is why you're good at

flipping houses. But you are definitely. and you don't spend any money on marketing, you're not trying to figure out some hack to figure out how to get a deal. You're just good with people. Can you share a little bit of how you navigate that road of being likable without being threatening? And like, you know, there's kind of an art form

to networking and making people like you that people that are listening that want to follow in your footsteps could start working on. Yeah, I think, well, it started on Instagram and just getting to know a lot of people within the same industry. And I just think it's fun to help connect. connecting people. So like with you, David, and connecting you with a lender. And I was at a party actually

this weekend. And someone was talking about, oh, I'm looking to invest in Kansas City. Well, when I was at the bigger pockets conference, I met an investor in Kansas City. And so I said, hey, why don't I connect you with this investor? And I just think it's nice to be able to do that for people. So that's so good. I mean, just such a simple thing is like, how can you bring value to other people and connect people? Right. And it wasn't a silly like, hey, here's a lender. I heard he does deals. look him up. Here's his business card, right? You actually spoke to that person, told him what my deal was. He said, yes, I think I can help him. You made an introductory email. You offered a help with follow-up. That is the right way to do it, as opposed to, oh, I heard Brandon is looking at

mobile home parks. I found one on Zillow. Let me send him the link to Zillow. Here you go, Brandon. Here's a mobile home park. There's much less value in that. And I just noticed, Kerry, that you are like, you're good with, like, how'd you get a contractor to teach you how to wire an electrical, like a can lighting, a recess lighting. Well, I was paying them hourly, specifically to teach me how to do that. Okay. Smart. That's cool. Yeah. Actually, you break up a good point, David, there about like the, you know, value is not necessarily going on Zillow or going on realtor, finding a property that's already listed, throwing it to somebody and saying, hey, I found you a deal. You know, we talk about bringing somebody deals. That's a great idea. But I actually, I get listings all

the time from LoopNet and from some brokers. And like, I mean, I love the heart that people have and that they're trying to help me and they're trying to work with me. But like, then it gets really weird when they want to, they want to cut or they want to commission. And I'm like, do you want a partner? Let's partner on this together. And I'm like, but I don't, I don't need you on this. I already knew about that property.

Like now it's weird because now you're going to be mad if I go after it because I already had it in my pipeline. Like, I can't prove that to you. Anyway, it's weird. So, yeah, we're. But that's why we're giving advice because there's a few more steps. Maybe call the listing agent. Talk to them.

The listing agent says, yeah, it's listed to 500. we take 425, we need a cash sale. Boom, now you're bringing $75,000, yes, in value that that person didn't have. And that one small step can be a really big difference. And I think, Carrie, you probably instinctively understand that better. You'll probably ask questions of the people you're networking with. Well, what are your goals? What are you trying to do?

And then you'll go through the database in your brain of all the things that you can offer. And when you say you like connecting people, that's what you're really saying. Yeah, yeah. There we go. And I enjoy it. I mean, it doesn't necessarily have to be something that you'll get out of it. I think, it's good karma. No, that's so good.

I mean, no, I think that's such a valuable point. I don't want to gloss over this. I want to spend a minute here. It's like, you're not networking for a transactional thing. Networking should not be transactional. And it drives me nuts when people do that. They're like, like, hey, I did this thing for you. Now I need you to do this for me.

Like, and I'm like, like, this is such a transactional weird thing, especially if I don't appreciate necessarily what they did. It could be anybody. Like, you just, you're like, I just like, can. I see people. Like, you just have a heart that likes to help people. Yeah. And long term, that will pay, and it has paid off for you and it will continue to pay off for you.

Yeah. Thank you. That's super cool. It's good. All right. Well, before we get out of this show, I got a couple more segments I want to get to, including the next segment, the deal deep dive. Deep dive.

Hey, I want to take a quick break from today's podcast to invite you to this week's upcoming webinar, how to make your first $5,000 a month through real estate investing. I mean, yeah, $5,000 is kind of arbitrary, right? It could be three or seven. but my guess is this, five grand a month could change your life. And that's the goal of the webinar. I'm going to be going through three key strategies for getting there, no matter what your financial picture looks like today.

Like, if you don't want to be deals right now, you don't have money, you don't have experience. Don't worry about it. Come anyway, just go to biggerpockets.com slash 5,000, 500 webinar. So biggerpockets.com slash 5,000 webinar. See you there. All right, this is a part of the show where we dive deep into one particular property or an investment you've made in the past, a deal you've done, so to speak.

So Carrey, do you have something in mind that we can pick apart? I do. All right. So let's dive deep into this thing. First question from me, what kind of property is it and where was it located? That's two questions. This was a single family home in Scottsdale, Arizona. All right.

David. How did you find this deal? I found this deal on Zillow. Oh, okay. So you found it on Zillow. Yes. How much was the property? What were they asking for it?

Okay. they were asking $330,000. Okay. How'd you negotiate that price of $330,000? Okay, well, that, I didn't negotiate that price. So that was the list price, 330. And when I walked in the home, I saw that there was, well, okay, I'll get to that. I'll get to that in a minute.

All right. So we purchased the house at 302.5. And I actually got to meet the owner of the home, and she was from Sweden. and we had just got back from Sweden. And so I think she kind of liked that connection, which was really cool. And so, yeah, she accepted our offer at 3025. That's awesome, which goes back to David's point earlier about you're being good at networking and getting people to like you.

Like, just like the fact that you had that thing in common, you could talk about it. You brought, somehow you connected those dots and like you had a, you know, there's such a thing. Like people love to sell to people they like. That's why I always give that tip all the time. I put it in the book on rental property investing and pretty much I tell everybody. It's like if you include a letter with your offer or you somehow make it somehow personal, there's just a good chance that they're going to like, oh, I like that person.

I'll sell it to them. Yeah. Like I've done this kind of like thought process. I'm curious, David, of how you would approach this because you're not a high eye like I am, like on the disc profile. But I'm curious, let's say you were going to sell a house. And I'll pose this to both of you guys. You're going to sell a property. And the property is, we'll call it $200,000 what you're going to sell it for.

It's a flip. You're going to sell it for $200,000. And you get two offers. One is for $200,000. You don't know the person. One is for $195,000 left. And you met this person. You randomly stumbled across them, whatever. You really like them. Like, whatever. Cute young couple just starting out or whatever. Like, hey, you just really like them. How much is that worth to you? When I do that thought experiment, I like to like, would I take 195 versus $200? If everything else is the same, would I do it? Hands down, I know I would do it. Even though, like, What about 10 grand? What about 20? So where's that line? I'm curious about you guys. Yeah, where does it stop? Where does that line go? Like, is 20?

Like, I probably wouldn't take 20 for somebody I liked, but I know I would take five. I'd give somebody a discount of five if I liked them. David, what are you? David's probably like, I charge a more because I like them. Yeah. No, I'm not that bad. But it does cross my mind. Maybe I can make them like me and then they'll pay more and they like me.

What's your number, David? It's a funny question you asked because when I became an agent, I had to literally learn how to be a high eye. like you Brandon. It does not come easy, which typically means I've become better at teaching it because it wasn't natural. I had to really like focus on how this works. And on my team, this is something I learned teach my agents. Before you ever talk numbers, I don't want you to say a word to the other agent until they love you. Call them compliment the crap out of their listing. Give them credit for the pictures how they came out. It's marketed so beautifully. I'm sure you have 15 offers on it. Like don't ever even talk business until their ego is just like completely swollen. And then, they love everything about you. Because in this business, like when like Kara, she's buying from the MLS, she doesn't get to talk directly to the buyers or the sellers. You have to go through their agents. So you have to win over the agent so that the vehicle that this information is coming to the clients through is speaking well about you. Oh, I love this, these people. They're blah, blah, blah. So it's coming across good. And what I found is like we were talking earlier about how I

I don't remember what our example was, but when the 60,000, I would never spend $160,000, but 1.7 to 1.8, I would do that. And we learn in psychology that there's, like, there's a principle that goes with that where we will drive across town to get gas that's $0.3 a gallon cheaper, right? But when we're buying a car, we'll throw on an $800 warranty we don't need because, right? Like, that's just how our brains work. And I think that's part of it.

When the seller has a ton of equity in there, that $5,000 doesn't matter. But if they're only going to be making $12,000 versus $17,000, That 5,000 is a huge deal. Oh, good point. So that's one of the things that I ask before we ever get into the price is like, how much do they owe on the house? What are they really hoping to walk away with? And if the agent's like, they just need to get it sold,

then I'm going to be super likable. I'm going to have my clients write an amazing letter. We're going to put puppies in it. We're going to do whatever we got to do, right? Or if they're like, they just want as much as they can possibly get, then I'll follow up with, well, what kind of a person do they want to see in the house? Are they working professionals and they want the same house to go to somebody else?

So I know that I did not answer your question at all Because for me, I probably don't care about the person Who buys the house I'm only going to care about like. You don't think you give a thousand bucks to somebody you really liked. Like somebody you just think of really somebody you liked that you met and you just hit it off with well. You don't think you give a thousand bucks. No, you're right.

I would do that. I don't think most people would figure out how to make me like them, I guess, if I really dig down. Like a cover letter, I would just assume you're trying to play in my hard strings and I wouldn't buy it. It would like make me more guarded, right? Because I'm all screwed up inside. So if the person figured out how,

to make me like them. Yeah, totally, I would do that. But that's a, there's a tip. Like, Carrie's good at that naturally. Yeah, she'll get you to like her and then you'd give her a $5,000 discount. Which is why that's a good skill to have because you're saving money by being likable. Kara, what's your number? $200,000.

You get an offer for $200, you get one for $195. Would you do $5,000 discount for a, or likeability? I would do $5,000 for sure. Yeah, see, I would too. So, like, get people to like you. You can save $5,000 on your next deal. Like, I really believe that. All right.

I just, I just don't usually. meet the buyers. Yeah, that's true. Yeah, I usually don't either. But if you can just find some way to get them to like you, it's always a great thing. Well, that's where the agent really comes in handy. Because if their agent can get your agent to like them, then that agent's going to say, oh, this couple's amazing.

They're going to butter you up. The design was perfect. They wouldn't change a thing. They think that, you know, Picasso designed this house. And then now you're like, ooh, okay, I want to sell to them. By the way, this was an example, a case study of how hosts should not do the deal deep dive. because we did it's time for like an hour. We've wandered very far away from the concise pattern you started us off on.

Sorry. Okay. Next thing, I don't even remember who asked a lot of question. We should let you ask it because you're the host and I'm the co-host. How did you fund this property, this $302,000 that you needed plus rehab? How'd you fund it? So I funded this with part my cash and then a private money lender. Oh, private money.

Can you explain that for those who don't know what a private money lender is? So a private money lender is usually someone who knows you. It's a family member. It's a friend. It's someone who putting a lot of trust in you. And basically, I can use private money for significantly less than hard money. So we don't usually have, I'm not paying points up front or a percentage of the loan up front. I'm just paying interest.

Yeah. Perfect. Great explanation. All right. What was the outcome on this deal? Okay. So the outcome of this deal, so the benefit to this project, because it was on Zillow, a lot of investors had walked this home.

and after I closed on this deal, someone actually reached out to me and she said, I looked at that property and I could not make those numbers work. So what I did, I noticed that there were 12 feet of side yard so I could build out 10 feet

and do a full addition the entire length of the house. So this house was marketed on Zillow as a two-bedroom, but it was two-beds plus an office. So that's an easy third bedroom, add a closet, reframe a doorway. So I had three bedrooms.

And then we built 820 square feet onto the home. So we added a huge kitchen. So completely moved the existing kitchen to the addition portion and created an interior laundry room, a fourth bedroom, a powder room, and a little dining nook. Wow. So that was. Like what was the rehab budget on that? The total rehab budget was 135.

thousand and we came in at 139,000. Oh, not bad. So that was really good because there were a lot of things that came up. We ended up replacing the entire duct system and a new AC unit that I wasn't planning on. So yeah, I was really excited to, that was a big project for us. So 4,000 above budget was awesome. And that included holding costs too. That's awesome.

So what, like, what was the final profit? I guess what did you make off it? So that was a, that was. That was a six-month remodel. That sold really fast, and we made $92,000. Woo. Yeah. Here's what I love about this story, is that it perfectly illustrates this point. I make it on webinars all the time.

That real estate is so three-dimensional. Yet new investors get into it and they think it is two-dimensional. They have one option, like, oh, it's a two-bedder house. This is what it sells for. This is what it rents for. Then they applies for rentals, flips, whatever. It's like, this is what it is. This is what it's worth.

Yet if you start thinking, well, what if I did this? And what if I did this? And it's one reason I love the bigger pockets calculators and I teach it this all the time. I'm like, well, what if you like spent 10 grand rehab in it? Then what could you rent it for? What if you spent 30 grand rehab in it? Then what could you rent it for? Or what could you sell it for if you add in a little addition?

And that is what in today's market goes to that idea that Dave and I talk about. Today you don't find good deals. Today you make good deals. So where nobody else could even find a way to make a profit out of this, you wouldn't made $92,000 off of a deal. nobody else could figure out because you're good at the creative, the 3D real estate. Yeah. Yeah.

Your creativity, it's huge when you're walking into these homes and seeing where you can add value. It's really fun. That's cool. And you get that skill from experience, seeing enough deals. You get experience from taking action. You take action when you have confidence. And that's why we go back to do what you have to do, learn what you have to learn to get your confidence built up, because that's kind of the formula for how to do this as well.

And now the next time Kara buys a house, she has. this whole set of data already in her brain of, well, on this one, we did this. And it won't work exactly on this house, but we could just tweak it this way and we could make it work. And now her mind spots that opportunity where the person who hasn't taken action doesn't. And that's why it's so important. Like, that's exactly why we're pulling this out of you. So, and those are the same strategies that I use care. I'm always like, okay, this house is smaller than every other house in the neighborhood. How do we make it bigger? How do we add square footage? You would never do that if every house was already, they're all the same size. It didn't need to be. Or if there was a limit on

how expensive those houses sell for. It's never going to sell over 110. It doesn't matter how big it is. But that works really good in the market. Yeah, for sure. And then on that house, it's funny, too, because I staged it. And then the new owners bought all of the staging, all of my staging stuff, because they were going to Airbnb the house. That's cool. That's perfect. Yeah. Yeah. Great job. Okay. So what lessons did you learn from this deal? I think the main lesson I learned was really the value of adding square footage. because it cost me, I want to say, it was about $120 a square foot to do that addition,

but then I sold it for $255 a square foot. So you can see where that profit margin is. And I didn't realize that a huge benefit of adding square footage until that house. I talk about that a lot in the burbook, that that's something you factor into your equation when you're looking to buy a house is what's the price per square foot to build and what's the price per square foot when you sell? and the delta between them would be, you know, your profit margin.

And what you want is areas like yours in Scottsdale with very big discrepancies in home prices. You want a lot of a difference. You don't want every house to be a track home that's like it's harder to make that work in an area like Las Vegas or maybe Phoenix, where they have these neighborhoods that are all just track homes. They're all the same thing over and over and over. It doesn't matter what you do. It's not going to sell for more than the house next door. Yeah, that's true.

We have a lot of track homes in Scottsdale too, but the areas that I like to invest in, it's the older. one's right? Yeah, yeah, they're old and they have more character. And more differences. Yep, the lot sizes are different. Yeah, right. Absolutely. This is some high level stuff. Thank you, Kara, for sharing this. And then also just the importance of, again, having your spreadsheet and constantly updating it. There's no way we would have come in at $139,000 for that rehab if that spreadsheet wasn't constantly updated. Because as we're getting towards the end, I'm thinking, I can't spend this on a chandelier or whatever it is. I have to cut back because we've spent a little too much in other areas.

Yeah. Do you have literally like a number and every time you spend money, it subtracts from that number, like you're watching a countdown as you get closer to zero? No, but I should do that. I should do it that way. I was just thinking. So no, they're all like color coordinated. And basically I have my budget, but then I'm just adding everything up.

So I know exactly where I'm at. But I like that. I was thinking if you were having to watch like I have 30 grand left and I still have to do this, that when you're tempted to make the decision that it would be fun but not financially wise, it would impact you. emotionally like, no, I don't have enough room in there. I won't do it as opposed to when you're just throwing expenses in it. It's easy to justify it.

That's true. Where I always fail at that is I'll go like, well, I know it wasn't the budget, but I could probably get a little bit higher price if I do this. And that is a very deadly game to play because usually I just lie to them. I'm just lying to myself because I want to do those, you know, that Travertine tile. Yeah. And really, I don't get another penny out of the house. It's a same price.

And you're not basing it on any form of objective reason. You just tell yourself that. Yeah. Yeah, that's actually a very. good point to like that's how people get in trouble as they start justifying things in their head for no reason at all your brain doesn't always help you that's funny all right you want to move us along let's move along next segment of the show it is our fire round fire round it's time for the fire round all right these are the questions that come direct from the bigger pockets forums and we're going to

fire them at you real quick here kara let's go here number one from jonathan in scott's valley California. What do you think of the Redfin, Zillow, Realtor.com, etc? As a real estate investor, what is the best way to use these tools, these online portals? Like, how do you use them? Oh, that's a good question. I use them a lot. So even if I have, for example, this just happened. So a wholesaler sent me a listing, which is not on the market because it's a wholesale deal. So I pulled it up on Zillow because I can quickly see what other homes are listed for. And I can even go in and see what other homes have sold for really fast. So I think that's a good way to use Zillow. And then also you can set up different searches. So you're getting emails of

criteria of your criteria into your inbox as well. There you go. And I think as Zillow grows, like I got to deal with time on Zillow just because somebody just went and made a listing because they didn't even realize like that the right way to do it is go get a real estate agent. They just see somebody commercials for Zillow. They're like, oh, I guess I'm going to sell my house. I just put it on Zillow. So they just went and put it on and they went there. Oh, list my home and they just put it for sale on Zillow and like it was this a for sale by owner basically so I wouldn't bought it so yeah nobody else saw it so you didn't have any competition they didn't have anyone representing them so I'm looking at a really good house right now and it's also a for sale by

owner that I found on Zillow yeah there you go that that I found I was just driving this neighborhood that I liked so I put on my navigation on Zillow so it tracks where I'm at and that's why I found it that's awesome very good all right next question is from Andre in Korea very cool from Seoul when you're negotiating, do you have a problem offering full asking price right away? If you know the numbers will still work? Or do you hesitate because you're giving up leverage and might be leaving money on the table? I would have a hard time offering full price. I think it's just a mind game. Even if the numbers worked, I would try to get it for less. Because you always make your deal when you're buying the house. So just in case your budget went over, I would rather, I just want to

get it as low as I can. Does that change if the house has been on the market for five days? and you're looking at it thinking that price is like is really good already. I would still offer a little bit less just to get the conversation started. And then see what they counter you at. Gotcha. What about you, Brandon? It depends on how long it's been on the market. So my kind of rule of thumb is if it's like the week of and it's a really good deal at the asking price and I'll probably go in an asking price.

Because I know everyone's going to be multiple offers. If I know that, if it's been on the market a while, the longer has been on the market, the lower price and more like aggressive on being on it. Very good point. Because I know where I work in the Bay Area, if you offer asking price that a house has been on for five or seven days, the agent might not even return your call. There's just an expectation here that it's going to sell for more if it's a good looking house. So they factor that in. But yeah, every market is different.

Yeah, it's true. Yep. All right. Next question from Robert Muzzi, Y, K-A in a real estate agent from Plano, Texas. I'm doing my first flip in quarter one of 2020 using hard money. Do you recommend? And I'm not going to answer to say ask you. a recommendation here, Kara, because it's an LLC question. It's like a legal question, but I'm

wonder what you do. Do you do loans in your own name in an LLC or in a corporation? What do you, what do you do on your flips? I do all of my LLC. I do all of my flips in an LLC. All right. Good. Me too. I didn't used to, but now I do. What about the houses that you refinance to keep as a burr? They're in an LLC. Same thing. Have you found a hard time getting a loan with properties held in an LLC, are you still getting like Fannie Mae, Freddie Mac financing? Well, no, because all of my properties, since I've only been doing it for two years, I still don't have two full years of tax returns. So right now I still have to use private money, my own money, or hard money. Okay. Gotcha. Yeah. So maybe that'll be a better question to answer

once you're at the point that you can refinance them into a cheaper loan, then you'll have learned how that works. Yeah, yeah. Well, you need to get a lender or somebody on the line that can actually answer that or a like a lawyer maybe because this comes up so often and I think it's a complex question all right last question for me from eli gilbert in cleveland ohio do you have a formula for how much profit you want to aim for in your rehabbing obviously the number should change depending on the size of the deal and the risk but what's typical for you and i think by rehabbing he meant when you're flipping a house so i don't have a formula for that i will only do a house if i'm making minimum minimum 23 thousand dollars and that's that would be like bare bones minimum for me yeah and i'm assuming that's

like a deal where you don't have to put very much of your money in there's very little risk it's like get in get out real fast yeah that would be a super quick flip and then if you have to put more money in or if it's a more risk involved like it's a longer project that's when your profit margin starts to grow right right and actually usually the bigger the risk the bigger the the bigger my profits are so yes you know this brings up some interesting um I've never really put a lot of thought in this. I'm going to kind of work through this in my head right now as we're talking live. But there's a lot of areas of our life where we say we don't have a rule of thumb yet or we don't have a formula.

Yet we actually do. And so what I mean by that, and I'm the same way. Because when I think about it, when I really think about it, I would not do a flip in Maui where I have to go invest $800,000 for $20,000. I would for $100,000? Would I for $50? Somewhere in there, like whether or not we've communicated it to our subconscious to our conscious, we have a formula that we are abiding by. And we do this with all sorts of things in our life.

And so I was thinking about how like one of my, I guess one thing I'm going to really work towards here in the new future and like starting right now that I say this is formulating or formulizing, is that a word formulizing those unwritten formulas so that other people then can give go or no go, you know, other people like an assistant in charge, right? So that way I like if you come to me and you like you say, you know, hey, I got this flip. I just, I know there's a rule in my head. I just, rather than me trying to kind of think about it and emotionally, it's like, no, does it make a 20% blah, blah, blah, blah, blah.

And when you really, if you're just spent five minutes, I bet Kerry, you'd come up with a formula that actually you probably abide by. And David, you probably do too. We just don't think of it. We just internally do it. Well, what happens is you have that formula deep in your mind, but you're not aware of it. So what happens is someone poses a question and your gut tells you yes or no. But you don't know what it's using to come up with that.

You just know you follow it. And what you're describing Brandon is a brilliant business tool is you get what is in your head out of your head. So it's not a gut thing. Otherwise, they have to bring it to you because you're the only one that has your gut feeling. If you create a process or a standard or a formula and you give it to somebody else, now they can answer that question for you. And you can almost get yourself out of it.

What if you're tempted to do a deal because you haven't done one in two months and your ego feels bad? Well, they don't have those issues. So they're not going to do the bad deal. That's a very good thing that you're pointing out because that's what smart business people do is they translate a gut feeling into something that can be articulated. they pass that off to someone else and it becomes delegated. And I'll bet you if we talk to Carrie next year or two years for now

when she's been growing her team, this is all that she's going to talk about. I knew how to do it, but now I had to figure out how to teach somebody else how to do it. That was hard. That's funny. I like this. I'm going to post some more thought in this

and this is probably going to be a video on bigger pockets sometime soon because, yeah, if we can take these things out of our subconscious and put them into a formula or into a rule of thumb, you can get other people making decisions that you would agree with and less work. That's true too because it helps for you to step out of your business too. You know, when you have a formula, you can teach someone how to look at deals for you and present them in a way where it makes sense for your formula. Yeah, so true.

And you have less of a chance of letting emotion get involved and you doing something stupid being like, well, you know, my gut says this is going to be a good one when really it's because you really like the kitchen. And your guts teaching you, you know, it's lying to you. It's like, no, really the numbers work on this. The kitchen's cute. like so anyway yeah very very cool that was a good topic i don't know why we i don't think we've ever talked about that on the show before but that's smart now i know they'll let people at home going elementary elementary all right that is the end of the fire round let's head over to one last segment of the show it's our world famous famous

this is the part of the show where we ask you the same four questions we ask every guest every week but before we do let's hear from j scott to see what's going on this week over on the Pockets Business Podcast. Hey there, Brandon and Bigger Pockets real estate podcast listeners. This is Jay Scott, your co-host for the Bigger Pockets Business Podcast. And this week on the business podcast, we have serial entrepreneur and outsourcing expert Nathan Hirsch. Nathan tells us all about how he was able to build several eight-figure businesses without

ever hiring a local employee. And he tells us how we can do the same. So if you want to learn how to effectively outsource in your business, tune in this week to the Bigger Pockets Business Podcast. Now, back to your famous four. All right, big things to Jay from the Bigger Pockets Business Podcast. Now it's time, I just, I like this. Now it's time for the Famous Four.

Number one. Kara, what is your current favorite real estate related book or a book that's made a big impact on you? My favorite real estate book is Rich Woman by Kim Kiyosaki. Oh, cool. So that is Robert Kiyosaki's wife. I have not read that. Poor dad.

Should I read that? I didn't think you would have read that. Is that why you're so terrible at being a rich woman, Brandon? I've been wondering when you're going to step that side of your game out. I'm going to work on that. Yeah. That's cool. Okay.

Anyway, very cool. Yeah. I actually, I have seen the book in the number of times that I thought I should read that because I'd probably learn a lot of good stuff. Yeah. It's interesting because she kind of talks about how they started also, but it's in a very different perspective. Yeah. Very cool.

Awesome. All right. What about your favorite business book? Think and Grow Rich. Napoleon Hill. I love that. Yeah. All about the mindset.

That's a great one. How about some of your hobbies? So I like doing anything active. I love working out, hiking, biking, boxing, you name it. Cool. And I love traveling. So, yeah. If you and I were boxing right now, I have zero skill in boxing, none.

I've never done it in my entire life. But I'm six foot five. I'm like six foot awkward, right? And I got a long reach. Who would win? You are me. You have skill. I don't know.

I've got size. I don't know. I know how to dodge. So I don't know. It might be tough. Yeah. I think most people that don't practice combat sports just completely underestimate how extremely fatiguing it is, right?

Like, Brandon is asking the question of who would win. And I'm thinking in my head, if you just didn't get knocked out for the first 60 seconds, he'd probably be so gas that you could just like wait for him to fall and step on his head. Yeah. It's just so much. It's so hard. Because didn't you tell Jocko you're going to start doing defense soon? I'm actually going today.

Today, well, for those who listen to the Jaco podcast, we did the Jocko Willink podcast, he called me out on it and said I had to go do it this week. So today is Monday. I'm recording this on a Monday. And I said I would do it on Monday. So I'm going tonight. And just to give you a quick, extreme ownership type thing, he, you know, I told him I was going to do it Monday. Though I looked up this weekend, the gym I was going to go to or the dojo or whatever closed here. So now I'm going to drive because I said I was going to do it.

I'm taking ownership of it. I'm not going to let anything stop me. So I got to drive like twice as far. and go to another one that I don't even know what it is or anything about it. But I'm doing it tonight. At a baby BT. It's very tiring. Just to be prepared for that.

So, Kara, once I've done a few months of BJJ, then you and I will go ahead and head with some boxing. I don't know if I know what on a box, but maybe the skills will come in handy. All right. That sounds good. Number four. What sets apart successful real estate investors from all those who give up, fail, or just never get started?

So I don't necessarily think there's one thing. I think there's a few things that attribute to success. And the first is definitely being your mindset. I think your mindset is everything. So you have to be willing to accept change no matter how uncomfortable that may be. And you have to be willing to accept failure because it's bound to happen. And you also have to always want to be learning. Anytime I have some downtime, I'm listening to podcasts. I'm listening to podcasts. I'm listening to all. audiobooks, even when I'm working out now. And rather than listening to music, I'm listening to something educational. Yeah. And the second, I would say it's also knowing and acting upon your risk tolerance. I think simply by acknowledging what your personal risk tolerance is, you're going to realize that you could probably take more of a risk than you're currently taking and then to reevaluate that constantly.

If you look at any successful entrepreneur, business owner, anyone who's found success in real estate, their mindset, along with their risk tolerance, has grown immensely from when they first started. And then third, I would say it's being persistent. No matter how small these steps are that you're taking, if you're being persistent in taking those steps towards your goal, you will win. It's perfect. beautiful that's very nice all right well this has been a fascinating show and i think people got a lot out of it so thank you for doing such a good job carara for people that want to know more about you where can they find out more they can check out my instagram it's beckman house and i'm also on the bigger pockets all right very cool very cool well carra it's been fantastic thank you so much and i would encourage

everybody go out and follow carra because she's awesome and her instagram is awesome so follow her there and that's all I got. So Kara, thank you so much. Thank you so much for having me. It's been a lot of fun. Thank you. All right, that was it. That was awesome, Kara.

Very, very good. Oh, thank you. All right, and that was our show with Kara Beckman. Awesome, awesome show. Make sure you guys are following her over on Instagram. Beckman House. Beckman House. Thank you.

I was looking forward here. Beckman House on Instagram. She has a great Instagram, and she's just super cool lady. So I'm very, very thankful for her today. We told you guys it was going to be a good episode, and it was a very good episode. make sure you're following her.

And by the way, if you want to hear Brandon's video that he said he was going to make regarding how to take your gut instinct and turn it into a formula, check him out. He's Beardy Brandon. I'm going to make one of my own at David Green 24 on Instagram. And I want to see which of us can get more views. Nice. So we've got a little competition going on. We're each going to make a video, view it and then like it, depending which one you like more.

And let's see how much Brandon crushes me. By the way, have you gotten to the TikTok yet? No, because all the memes I saw about it were making fun of it. So I thought it was like, you shouldn't do it. Why are you addicted now? Okay, so I need to make a video about this. Like, it is the most. Video out of video.

It's a video. I'm going to make a video about TikTok. It is the most addictive, like social thing, like social network ever created. And I had to take it off my phone just like Instagram, but like it's worse than Instagram. Here's my rant with TikTok real quick. For those who don't know, it's like Instagram, but it's only videos. And it's people you don't know. So you're just like swiping through videos.

And they're funny. and they're clever and they're like a lot of middle school humor and a lot of like girls flaunting themselves and guys flaunting themselves. And here's the problem with TikTok, the biggest problem I have with it. First of all, it's fun. It's very enjoyable and there's a lot of funny stuff on there. But it sets its expectation that like, one, if you're a creator of content, you would go make videos, it like hoax you like cocaine.

It's like, oh, I got to do another video. I wonder if I can do it. Like, even in a couple days I had it, I was like constantly thinking how, maybe I can make a video about this. and people would like it on TikTok and I'd get more views. So it changed your brain chemistry, like how you thought about things? Yeah, there's a study they did with like the rats and like the cocaine in their water. It's exactly that.

They just give you these little things and it's so well programmed to suck you in if you're a creator. And if you're a consumer of content, which we all are, what it does is I think it gives you this false belief. It's like, you know how they say like social media is a high, like your highlight reel of life? It's like that about people. So every single person, it's voted up almost like Reddit style where it's like their algorithm shows a topic. the top. So everybody on there is super funny, super clever, or super hot. And you're just like, wow, and they're all in cool locations. And it's like this like, it takes what Instagram and Facebook did and multiplies it by intent. You just feel horrible at your life while you're watching

it, but you can't stop watching it. That's my rant. Because you only see the content. Is it because you only see the content of the top people? So you think everybody must be this way. Whereas with Instagram, you get your grandma's thing or your high school friend who never did anything. So there's a little bit of reality mixed. there but with TikTok it's just like pure. It's perfectly engineered to get you sucked in and to think that you're missing out on all these great things. It's crazy.

So it's like heroin with no cutting agent. You're just getting raw, terrible drug into your brain. Consistently. People are like, I bet you if they did studies and they probably will, I bet you people who consume TikTok regularly are going to have like, I don't know, mental problems. Because it's like. And you just ask me if I'm on there. Like, did you just offer me drugs on the podcast right now?

I was wondering because it's been like consuming my life for the last, probably a week. I had it on for my phone for a week. And like I literally like, well, like every time I have like two seconds downtime, I'll pull it up because it's so addicting. I had to take it off my phone because I'm like, I can't. Yeah. Anyway, crazy TikTok. So stay away from TikTok. Follow us on Instagram where it's safe.

You'll get good content, not hyped up, you know, drug abusive content. I bet if we put this conversation on TikTok, it would do really well. We should do that. I'm going to put it on. I'm just kidding. See what I mean, though? I wonder if it would. I thought about making a video called why TikTok is dangerous.

I bet it would go viral, go viral. But then what does that mean? matter. Like you reached 20,000 people one day and like next day your life still sucks. And so like that's the problem with TikTok. It's like it makes you feel like you're accomplishing something. It's like going to the trap house or everybody's doing drugs and giving them a presentation on why drugs are bad. People would listen. It might not be mad. Yeah. They'd listen, but would it help because you're on that. Cool. That's funny. All right. Well, anyway, that's what I got. Thank you very much, Brandon. And thank you, Kara for, uh, I know we just completely took this on a rabbit trail from a very big rabbit trail.

episode. But that was good stuff. Like, see, guys, you don't just get real estate. You get life advice here from, from Uncle Brandon Turner, trying to protect, prevent you guys from getting into psychological drugs. So thank you very much. Please go sign up to get some more information with BiggerPock's webinars. Comment on what you guys liked about the show on our Instagram. So you can message me there.

That's a good way to get a hold of me. Today's pro deal. Our spotlight. Our pro deal spotlight today, Cam Vangercove. I think it's how you say the last name. Just closed his first property in Rochester. New York. It's a duplex. Two-bedroom on the bottom unit. Two-bedroom on top unit. Bought it for $172,000. And yes, house hacked it with a 3.5% down payment FHA loan. And his tenants actually cover all

but $100. So he's living for $100, which is cool. And here's what I actually love. I really love about his deal. He did it with a partner and they're kind of like sharing the two-bedroom unit upstairs. So really, he's actually only living for like $50 a month, which is super clever. So congratulations to Cam and all of our pro members who are doing deals and posting them over on the site. You guys are awesome. And if you want your chance of being featured here on the Bigger Pockets podcast, email podcast at BiggerPockets.com and put the word pro deal in the subject line. Again, podcast at BiggerPockets.com, put the word pro deal in the subject line.

And with that, David, why you get us out of here? Thank you very much. This has been a great time. This is David Green for Brandon. TikTok Turner. 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 others who have benefited from biggerpockets.com. Your home for real estate investing online. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing on YouTube, Apple, Spotify, or any other podcast platform. our new episodes come out Monday, Wednesday, and Friday.

I'm the host and executive producer of the show, Dave Meyer. The show is produced by Ian K, copywriting is by Calicoe content, and editing is by Exodus Media. If you'd like to learn more about real estate investing or to sign up for our free newsletter, please visit www.biggerpockets.com. The content of this podcast is for informational purposes only.

All host and participant opinions are their own. Investment in any asset, real estate included, involves risk. So use your best judgment and consult with qualified advisors before investing. You should only risk capital you can afford to lose. and remember, past performance is not indicative of future results. BiggerPockets LLC disclaims all liability for direct, indirect, consequential, or other damages arising from a reliance on information presented in this podcast.