BiggerPockets Real Estate Podcast - 406: 51 Units and $900/Month in Pure Cashflow on a “BRRRRnB” with Shelby Osborne

Episode Date: October 8, 2020

"Systems, People, and Positive Vibes" are what powers Shelby Osborne's business, and today she breaks down exactly how she's used those 3 forces to go from 0 to 51 units in just a few years. Shelby shares how she boils everything down into checklists and automated reminders, so she can focus more energy on revenue-generating activities. Plus, she shares a combination word that's right up there with "liger," "bromance," and "Bollywood": the "BRRRR-nB." In her Deal Deep Dive, she reveals how she picked up a foreclosure property, transformed it into an Airbnb to generate big-time cashflow, and expects to pull all her money out so she can do it again and again! A former U.S. Army captain, Shelby is a serious go-getter and you won't help but be energized by her "no excuses" approach to life – colorful language and all ;) Oh, and before you leave this page be sure to check out her checklist for startup your own real estate meetup below! (If you can't see it on your phone, head over to biggerpockets.com/show406.) In This Episode We Cover: How Shelby transitioned from Army life to real estate agent and investor life How she finances her deals with a combination of bank loans, hard money, private money and lines of credit The details of her ongoing "BRRRnB" deal How she saves time by using email templates and automated follow-up sequences How to set up your business to run on autopilot so you don't have to rely on your (unreliable) brain Building a community to attract talented people with positive attitudes And SO much more! Links from the Show BiggerPockets Forums BiggerPockets Podcast BiggerPockets Wealth Magazine BiggerPockets Insights Myers & Briggs Test The DISC Profile Open Door Capital Find Real Estate Agents Pints and Properties Meetup BiggerPockets Podcast 396: Post-COVID-19 Investing and Landing Great Deals at Auctions with David Osborn and Aaron Amuchastegui AirBnb The Incredible Power of Long-Distance BRRRR Investing with Alex Felice Check the full show notes here: http://biggerpockets.com/show406 Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 406. So I saw the for rent and I called it and I was like, hey, just inquiring about this property and I was wondering if you might want to sell instead of rent. And the guy was basically like, please, I don't want it. And I have another one that I want off my hands. So, and of course it takes a lot of calls before you find that one guy who's willing to sell, but they're out there. 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? It's Brett and Turner, host of the Bigger Pockets podcast here today with another phenomenal show with my co-host, Mr. David Green. David, how you doing there, man? You're breathing okay there in California with all those fires? Nope. Got the mask on. We're staying indoors.

There's the whole state's on fire. So you can't really go outside. But that's okay because we've recorded an awesome episode of the podcast. And if you two are like me and you're getting cabin fever stuck in the house, this podcast will definitely lighten your mood and get you pumped up. Yeah, so good. I mean, today we're talking with somebody named Shelby Osborne. Shelby, I've seen her around the Bigger Pockets community a lot.

She was even in like one of the bigger pockets wealth magazines recently. And she just has a phenomenal level of energy and passion. and just intelligence around real estate invested and how to really scale a business. I mean, going from like a military, full-time job to being able to quit that and then have like 51 units now. I mean, some of them, she owns with partners.

Some she's just done from like, she's done burr, she's done house hacking. She's done like everything. Just an amazing cool story. She's going to kind of go through the whole thing today and tell us a lot. And her answer to what sets apart successful investors at the end of the interview

was one of my favorite I've ever heard. So you guys are going to love today's show, Especially, by the way, make sure you also listen for her conversation on like delayed financing. That alone could change a lot of people's lives if you plan to do burr investing down the road to buy rehab, rent, refinance, repeat strategy.

You'll love that. So stay tuned for that. But before we get to that, let's get to today's quick tip. Today's quick tip is if you've not checked out the brand new Bigger Pocket's Insights, which is amazing.

We have this new thing called Property Insights on there. where you can look at property, get a bunch of details on like previous rents and what their current rent would be, what the market's been like. It's really like BiggerPockets Insights is designed to help you make the best choices on like what market to invest in, what neighborhood to buy in and what property and what that property is going to likely do in the future. It's really, really cool. It's part of our BiggerPockets Pro membership. We just launched this whole Insights thing. Do yourself a favor and just go check it out. BiggerPockets.com slash insights. Again, biggerpockets.com slash insights. I think you'll be pretty impressed and it's going to help your business quite a bit. So that is today's quick tip.

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If you want to do the same, visit BiggerPockets.com slash retirement to learn more. And now it's time to get into today's show. David, anything you want to add before we jump in? Yeah, we talk a lot about how there's parallels between building a real estate portfolio, which is really a real estate business and how Shelby built her real estate agent team. And frankly, this applies to anybody. You may have a job where you're a mortgage broker or you're a contractor or you do something that has nothing to do with real estate, but you want to scale that into something bigger. Pay close attention to how it is pretty much the same principles regardless of what you're

doing that lead to people being successful. And when you reverse engineer that success into a bigger portfolio for yourself, it can also make you more money in your job. That's one of the things I love about our podcast and really bigger pockets in general. is on this podcast, we learn all about how to build wealth through owning real estate. But then you can go listen to Jane Carroll Scott and learn about how to build wealth through business. You can listen to Mindy and Scott, Trench, talking about how to build wealth through managing your finances better. There are so many ways to build wealth. And I feel like today's

touches on how she's kind of combined a lot of the strategies together. Yeah, very true. And one quick warning. So Shelby is a mill, she was raised in the military and was in the military as she, you know, got through her 20s. So there is some, as you typically find with military, people, a little bit of explicit language. Just a little bit. Just, you know, if you've got young kids in the car listening, just be warned. So, yeah, but this show is phenomenal. But that said, let's get to it. Let's do it. Shelby, welcome to the Bigger Pockets podcast. Awesome to have you here. Thanks. I'm so strict to be here. Cool. All right. Well, let's get into your story. How did you get into real estate investing? Okay. So once upon a time, back in 2012, I graduated from college at University of

South Carolina and commissioned as a lieutenant in the Army. And my first duty station was at Fort Lewis Washington near Seattle. Probably, yeah, probably nowhere that is. Yeah, traffic sucks by Fort Lewis. Every time you drive by, it just slows down to nothing. Yeah, it's awesome. It's a monster. It's terrible. Yep. So I went out there and I had zero interest in real estate and I figured I'd just find like a sweet-ass apartment downtown Tacoma and just hang out with my friends, like literally no concern for the future, really. And then my dad actually planted the seed relatively aggressively. He's an aggressive man. And he was like, you should use this thing that you have called a VA loan and you should buy a house with zero percent down. And why would you pay someone else's mortgage when you could pay your own?

And I was like, oh, fine, dad. I guess that sounds like a good idea. And it turned out to be a fantastic idea a couple years later when I moved to Fort Bragg, North Carolina. This is four years now. So 2016. And that's the land of the 82nd Airborne Division. the largest military installation in the United States, and it's also very intense when it comes to the military. But anyway, so I went to airborne school, jumped out of airplanes, did some air assault stuff, and I showed up to Fort Bragg ready to roll. And I did roll for a year. It was badass, but with badass comes frustrations. So in the military, I don't know how much you know about it, but there's a lot of lack of efficiency. There's lots of shit that you do that doesn't

make sense and disorganization. And a lot of, you know, because we've always done it this way, as opposed to what makes sense. And that does not fly with me. So I started to pick my head up and look towards like the next five, 10, 10, 15 years and saw exactly what the military would bring me and decided that that was not the course for me. And so it was right around this time that I decided that I was going to make a change that I fell into a lot of things at once.

So I read my first Robert Kiyosaki book. I started paying attention to my property back in Washington that I had kept as, you know, I didn't run numbers or anything, but I bought it for 158 and back in 2013, and now it's worth about 260 and it cash flows. Like I fell into this amazing thing and I was like, hey, like real estate, this is awesome. And the Robert Kiyosaki, like the thing that really hit home was that cash flow quadrant. And I came into PT with my guys the next day, like physical training in the mornings. It's like 6 a.m. and they're hungover and half asleep still. And I'm like drying on this

dry race board. Like guys, we're employees. Like we need to be. investors. And so they all thought I was crazy, but it's fine. I decided real estate was my future. And from there, started taking off. That's cool. This is the first time I've ever heard Robert Kiyosaki's cash flow quadrant being applied to military personnel, which like the whole goal of the military is to keep you in that like employee by doing exactly what we say and only that. That's really funny. Did it, did you feel like any of the seeds you planted took root at all? It did a little bit. So it's funny. So I decided to get out, and that was around April of 2017.

And by November, I had bought my first intentional investment property, and I'd got my license at night school. And it's funny. So my first year was 2018. That's when I signed out on Terminal Leave. But by the end of 2018, my soldiers were hitting me up. And they're like, you know, do you got any like side hustles you can do? I had them work in it.

Rent rental property is like doing handyman stuff. So like I, some of it, some of it stock a little bit. That's cool. That's cool. Yeah. I want to know that first property real quick. I want to go into the, because a lot of people get started with the accidental rental thing, which means they buy a property, they live in it, and then they decide to move out and try to keep it.

Why did you decide to keep it? And then what kind of challenges you face or was it all pretty easy at that point? Like, what was that like transitioning there? So I decided to keep it because, again, my dad, I was like, hey, what do I do with this? And my dad had done a couple rental property. He was not big into real estate, but he has a really good mind for money and investing. And he was like, you should just keep it and rent it out. So I did, and I have a fantastic property manager out there who does really great, you know,

work. And every time there's a turnover, she increases the rent. And I've actually never really had an issue because I bought it turnkey. I bought it nice. Because think about 22 year old, Shelby was like, I want to live somewhere nice. And now I live in like a shit hole. But how times have changed. But yeah, so I bought it zero percent down. And then my first intentional investment property in November of 2017 was a 25 percent down conventional loan. and I got, it was a duplex for 75,000, and now it rents for 725 and 675 each side. So it's like almost a 2% deal, which loved that one. And then in January of 2018, when I got out of the Army and started doing real estate full-time,

I was an agent as well as an investor. And by the end of 2018, I was the Keller Williams rookie of the year for all of North and South Carolina. And I'd acquire a total of 16 doors. So that was year one. And then year two started my realty group, which we specialize in helping investors invest, like we are agents who specialize in working with investors. And then by the end of 2019, I was up to 41 doors. Wow. All right. All right. So I want to talk about. Yeah, I want to unpack all

this stuff. So you got out of the army. You decided I'm going to go and build up this business. I'm also going to be a real estate agent because you needed to have a source of money, right? I had to. Yeah. Yeah. Yeah. It's lame, but you know, we somehow got to pay the bills. So why why become a real estate agent? What was the idea behind that? Did you just love real estate? And you're like, I just want to help other people? or where they come from. Okay, so I do like helping other people. But, and it's funny because recently I've been reflecting on the fact that, like, I don't even love real estate that much. I just love the avenue of which, like the opportunity it brings into the world. But yeah, so I decided to be an

agent because it directly correlates to your work ethic and your ability to solve problems. And your income is not tied to like promotion rates or amount of time in a position. Like I loved the fact that I got my license in my very first year. I made twice as much as an agent as I did as a captain in the army the year before purely off of me just being able to figure shit out and make things happen. So I loved that. It fueled my active income, which I threw it all into my passive. Yeah. So what do you think about when people ask, should I get my real estate license to invest in real estate? What's your answer? It depends. It really depends. So if you are like me and you are going to make it a full-time, false-to-wall type of thing. I think that it does make sense

if you are good with people and you can make people trust you, then you can be great at real estate as like having an eight, your license and being an agent. But if you are just doing it slower and you still have a full-time job, I really don't think that you'll be able to get in the weeds with the MLS and make it worth it. I think it's much better to find an agent who is riding those streets and hustling. And they can, that's your source of leverage and outsourcing your time. So it really depends on your situation. Yeah, but Shelby, being a real estate agent is nothing but putting a listing on the internet and that's it, right? Like, oh, my God, get out. I quit. I want to ask the same question to you, David, because I know you and I have had a million conversations about this. Should an investor get a

real estate license to invest in real estate? No. And it's the same answer I would tell them. If they said, if you said, should an investor get their appraisal license and learn how to do appraisal. Should an investor become a general contractor and learn how to fix a house? Should an investor become a property manager? The best part of real estate is owning the real estate and the best part of the business of real estate is how easily it can be leveraged. It is the fact that easier than most things, you can leverage off big chunks of it. If I decided I wanted to create a brand of clothing and I wanted to make jeans, it's a lot of hard work to figure out who's going to design the jeans and where are they going to be manufactured. How are they going to be marketed? Who's going to sell them? It is a lot of time that you

have to spend to build up the support system that you would need to eventually make money from jeans. It's not like that with real estate. I just bought a house. Who's going to manage it for me? There's a ton of people saying, ooh, ooh, me, me, me, let me do it. You're a lead to them, right? I want to find a house. How can I find someone to help me? There's a ton of Shelby's that are like, ooh, ooh, me, me, I want to help you find that house because their business is based on you. You become the in-demand person when you're the investor. It's just kind of silly to me that people would say, even though it's so easy to go out there and find someone who's probably better than me at doing this part of it, I want to learn how to do it myself. And I'm going to let Shelby actually run with this because

I have a bunch of questions I want to ask you about. Yeah, well, first of all, I was going to say, you said that there's a ton of Shelby's and there is one, one of a kind. Just make that clear. But besides that, I totally agree. I totally agree. I found that especially starting out, people are more concerns that they don't want to show that they don't know what they're talking about so they don't want to ask the questions. And then they waste hours and days and weeks of their lives trying to figure out all these details where literally I am the first one to be like, I don't know, I'll find out. And then I make the phone call to the attorney, to the lender, to the appraiser, whoever it is, and find the information like that. So all of these people are

specialists and you should use them as such. So. Now, I want to ask you a question, not just for the investors, but there's a lot of agents that listen to the podcast, Shelby, I think you'd agree. You probably hire a lot of them. I do. Right? Can you explain? Because one of the reasons I like, just like you, I don't love real estate, but I built a team and became a broker because there's so many parallels between owning property, bringing down deals, finding them, leveraging the work, and owning a real estate team where you're finding down deals, getting people involved to leverage it, closing the deal. Can you explain maybe the synergy or the similarities between those two ways of building wealth and why, if you're good at one,

you might be good at the other. It makes so much sense. Okay, so I think of it as you are able to be the conductor of the orchestra. I really like this analogy because then you have each piece of the performance coming together and all you are is you're directing and you're overseeing everyone come together and create this beautiful whatever. So if that makes sense, it's the same way as an investor as it is, if you own a real real estate, you're a real estate. You're estate company or even if you're a broker, you can use a lot of the same strategies, is you find the right people for each piece and then just utilize them correctly, treat them right, and oversee it all. That's really good. Yeah. And I think because Shelby, you sound like you just accepted,

I should not be doing everything that you scaled so much faster. I mean, look at, you grew a bunch of doors and you became the rookie of the year at the same time in your first year. That's not a coincidence. It's because the area that you excelled in, which was, I know what I'm good at. Let me find people around me to do the rest, worked in both worlds. And that's kind of the blueprint that I want to highlight for the investors. If you're getting in your own way, that might be why. What do you think, Brandon? Well, I wanted us, like, because I agree, that skill of being able to hire other people

and be the conductor is so powerful in every business. I mean, every business owner I ever talk to, whether it's real estate or otherwise, like that's always where the conversation goes to, almost every time. It's like they're struggling and being the conductor and they're trying to do too much themselves. The question I want to fire at actually each of you, but I'll start with you, Shelby, is how do you balance that with not being successful in the beginning? Like, I don't have any money. I can't go and hire a team. If you're new, how do you become the conductor without first playing, you know, third saxophone in the back row or something? Like, how do that work? So for me,

there's like three steps. You got to start with systems, then you move to people and then you move to the community or like the vibes that you create. And so what I started with, systems. Like I started by doing as much as I could myself. And I don't mean this to backtrack what I just said about like using specialists. You use specialists, but I mean for your specific role as an investor, for your specific role as an agent, what you do, document it, document it, systemize it and automate it. So for instance, for me, like my rule of thumb is I will not do the same thing twice if I have to struggle through it. So I will struggle through it and I will literally write it all down, create a checklist, and then file it, and the next time that comes up,

I just pull it up and I'm like, oh, that's how I do it? Or when a client asks, when another investor asks, how do I do this? I'm like, perfect. I already have this one-page cheat sheet, and I send it out. I do the same thing with all of every email that I've ever written. And this really helps my agents as well as I have a whole package of draft emails for buyers and for sellers specific to how the flow of the process goes. And then there's a checklist for everything that we do. So, systems first. And once you have that, you can take the right people, which we use disk and Myers-Brigues a lot to identify natural characteristics of people. And we pair them to those checklists, essentially, to who can execute those way better than I could ever. So it's all, if that makes

sense, it sounds. It does. It does. So you start with systematizing everything. And so in the beginning, that could be if you're a real estate investor trying to buy your first duplex, right? In the beginning, yeah, you're going to have to be out there doing a lot of the digging around for numbers. You're going to have to be looking on the MLS, but start thinking, like, what are you looking for? What does that criteria look like? How can you put that into a checklist so that it just becomes more and more clear? And then you can tell other people to go find those for you. Is that what you're saying? Exactly. And you always, it's really hard to start with the end in mind when you're just starting out. But even if it's not the end, not everyone knows what you know their five-year vision is,

if you can start when you're creating these systems, knowing that someone else will be doing it down the road, that will help you a lot better being able to articulate because it's not for you. it's for that other person to take that torch and run with it. That makes sense. David, what do you think? I agree 100% Shelby with what you're saying. I think that most people, frankly, don't progress down the cash flow quadrant that you mentioned, not because they can't figure out a way to do it because they won't let go of either the fear

of doing it on their own or the trusting of other people to do it or the actual necessity that you have to lead people when you're doing that. There's a hesitancy. A lot of people have to step in and lead others. Oh, there's a lot of personal things that we could get into about why that happens. But the common thread with everyone we interview who got a lot of doors or a lot of properties are scaled every time was either they stumbled into it or they purposely built it, a system, an organization, a way of this person does this and this person does that. And you can wander around for 15 years and then finally figure it out. boom, you'll scale, or you can get it in the first six months or three months or whatever it is,

and you're going to scale much faster. But the road's going to be the same. If you're trying to do everything yourself, if you don't want to be disciplined and write down, I do this, then I do this, then I do this, then I do this. You're just going to tread water forever. Totally agreed. Yeah, and then finding the right people, yeah, that's like a whole other challenge in itself, because I do see what a lot of people fear. And it is hard to trust something that you've built and grown in the hands of someone else. But once you do are able to identify talent and can trust people, you really have to let them take the reins because nine times out of ten, if they're the right person, they will be able to build that position even better than you could have ever dreamt it to be. So.

So let's get an example. Let's start with rental property. What's a system that you built and how did you automate it? And then we'll talk about what people did you bring in. Okay. There's so many different ways I can go with that. That's why I was like, I guess we could talk about how I did use to manage my own rental properties. And I built a system for that. And it's just a quick cheat sheet on exactly what to do from once you get the property, the photos, how to market them, the sign in the yard. And then also, I don't know if people do this in different markets, but we have multiple pages on Facebook, Facebook marketplace. And like, moving to Fort Bragg, moving to Fayetteville, like all these different places. So systematically marketing on each one

of those to get an influx of tenant applications and then using Cozy to screen tenants. I'm a huge fan of Cozy. I used to use it for all of my properties before I switched over to property management team for that. And so I guess just like I did that once and I struggled through it. I freaking read that yellow book. What's it called? It's that for Brandon, wasn't it yours? Yeah. Yeah, the book I'm managing rental properties. Yeah. I freaking read that book. And I pulled, I mean, I loved it. I pulled everything that I needed for each, like I pulled the meat out of it and made it a quick checklist for me and then I just repeated it for each one of my properties. So I guess that that's one example of how I've been building systems. Does that make sense? Yeah, I think that's perfect.

I mean, I think the key with systems I like to think is like, can you put it in a checklist somehow? If you can put in a checklist that like a high schooler could follow, it's probably a pretty good system. And so like the more things in life and you like, I think sometimes people go through life thinking or when they hear this, they think, yeah, but you know, whatever I'm is more complicated than that. But if you really stop and think about it, most things we do are not. We're just doing those checklists in our head

and then we skip steps and we mess things up. But almost every, I mean, you could go to extreme. Like dating could be a checklist. You could literally be like, did I greet them with a smile? Did I,

you know, take them to a nice restaurant versus a crappy restaurant. Did it? You're like, we do things. I'm not saying you have to, you know,

have a checklist. That'd be really funny, actually. Like, I would love that. Like, yeah, you're pulling out your thing.

You have nice eyeball. I mean, eyes, eyes, not eyeballs. Scratching off on your paper. Screw that one up. Yeah. Oh, man. That's hilarious because I've noticed that there's a progression of how I built system. So it started with the checklist, just like you said, it moved into a spreadsheet,

which is now easier that I can say, okay, on this spreadsheet, we're making sure we did the things. Then it moved into what I call an auto plan, which is like some form of CRM that reminds you. Did you do this, right? And I was just thinking as Brandon was talking that your phone would give you notification saying, like, find something to compliment her on. Here's three things that you could use. Ask about her. siblings, right? Like you're getting all these little reminders in your in your like air pod telling you

what to do. It reminds me of a lot. Remember, I just watched Aladdin the other day and the genies acting like a bee in Aladdin's ear and he's like, complimenter, complimenter. You're, you're, punctual, punctual. It's like, anyway, I watch a lot of Aladdin. No, that's good. It's your movie. Yeah. So that's what checklists are. They're like a little bee buzzing in your ear telling you what to do next. Yes. Because we just naturally forget the stuff. So whether it's buying rental properties, whether it's going on, like you're doing driving, you know, driving around looking for deals, whether you're doing direct mode marketing, whether you're talking with an agent. Like all that stuff can be put into a somewhat of a checklist and systematized so it actually

gets done. That's what we're trying to do with systems, right, is making sure it actually gets done and gets done correctly. And that's, I was going to, what David was talking about with automation, that's the next thing. So it's like document first and then automate next and everything that you should not trust your brain for anything, like reminders, calendars, all of those sort of things will save your life because your brain is not trustworthy. It's not at all. Yeah, anytime I rely on my own brain to remember pretty much anything, it just 50-50 shot it gets done or that I remember to do it. Oh, less than 50-50. And you know, people don't realize how much of the anxiety that they experience in life is due to the fact that you're relying on your brain to be this thing that was

never meant to do. It's terrible when it comes to remembering that. And then what we do is we beat ourselves up. We go, oh, I can't believe I made that mistake. I should have remembered. A better person would have remembered. I'm not meant for this. Whereas the most genius people, the best ones are like, no, I'm an idiot. I would never expect myself to remember that. That's what my computer is for. Yeah, that's all the time, man. Like, people say stuff and I'm like, I'm never going to remember that. So my system is I text myself, my email. Like, I email myself, because I know that if it gets on my email, I can flag it for follow up and I will not miss an email. But if I get an inquiry from, you know, Instagram or Facebook or all of these different systems,

Like I have to screenshot it and email it to myself because that is my one source that I will not lose stuff. So yeah, that's great. Yeah. All right. So you got the systems and you got to automate them. Yeah. Lastly, you said people. Let's talk about that for a minute.

Yeah. So when it comes time to bring in people into your team, whether it's like you're trying to find that real estate agent, so it's just like a contractor or maybe it's an employee, an assistant or whatever. What have you found has worked really well for you in finding good people to work with? So finding the right people, a lot of it has completely. become from word of mouth. Like, for my experience, people who know me like me and trust me already, know other people who I would feel similarly about. So those tend to be really

strong referrals for people to join or build the team. But then once I have those people, we go through a checklist, a series of checklist of they need to do the disc and the Myers-Briggs assessments. And I know, David, you're familiar with this. Do you guys know Myers-Briggs? I haven't worked with Myers-Briggs. I know. No, we use the disc more commonly. But why don't you share with the guess what the what the Myers-Briggs does and why it's important for building a team. Yeah. So similar to the disc and the Myers-Bergs are both very, very helpful tools and do different things. So Myers-Briggs in particular is the one where it's going to say introverted versus extroverted. That's, you know, how you recharge. It's not even whether or not you like to be around people.

It's how you recharge from being around people. And generally we want our agents tend and even admin tend to be extroverted because you want them to be around people and be good. with, you know, their clients. And then the next one is intuitive and sensing. So that is whether or not you are a visionary versus you can see, like you work with what you have in front of you. So generally people who are visionaries, like I'm an end, they take what they see and then they create more from it. Does that make sense? It's all of these things are just good factors to know when you're dealing with like employees or with clients. And then the next one is a feeler versus a thinker. so how you, like, are you emotion driven or are you logic driven? And then the last one is the most important one in regards to admin, at least for me. And that is Perceiver versus Judger. And so the P's,

the days, the days happen to them. They really go with the flow. And then the Js, they attack their day and they're going to have a schedule and they're going to have a checklist and do all the things. So those are just really important to me in particular. The Js are what I look for generally for admin, the ones who attack. Does that help? I don't even know. Like, is this cool? You're going to talk about. Yeah, this is awesome because a lot of people, a lot of people was hiring in my own for years was like literally like, you have a pulse. You'll do. And so what I'm sensing from you and I know this is true of David as well is like this intentionality behind hiring.

Like hiring is not meant to be like, oh, you'll do. Like, hey, you're my brother's friend's sister. Like you'll be fine. Like you're in my space. So that'll work. There's so much more to hiring. Yeah, exactly. And you're not going to be.

to know all those things just from like a five-minute coffee conversation with someone and looking at two like assessment results. So what we always do is like if it seems like a good fit, we bring them on and we do a 30, 60, 90-day process. And I recommend this to anyone who's trying to build their business, but they're there for the first 30 days at the end of that 30-day. You sit down with them and you say, here are the things that you did really well. Here are the things that you can improve on. Here is the way ahead for the next 30 days. And then you do that again at the 60-day mark and again at the 90-day mark. So that way there's always this open line of communication. No one feels like they don't know what's going on in the process or whether, oh, are they liking what I'm doing if I'm not?

And then it's very clear cut at the end of the 90 days. You're either a good fit or you're not. And there's no hard feelings. Yeah, that's really good. I love to say you never know how somebody is going to be until you work with them. Like I love like that you just never know. And so we do a lot of internship programs with Open Door Capital. I mean, I have three interns right now.

And like we want to work. In fact, most of my team, maybe even all of my current team, came from working together first in a limited way and then bringing them up once they did. I'll give you a quick example. So Mike Williams is my head of investor relations. So he's in charge of all the raising money aspect, everything like that. And Mike actually, so ironically, Mike, I met him through an interview for bigger pockets. He was applying for a job at bigger pockets years ago. And he ended up not getting the job.

I kept in touch with them. And then we launched this like 10 person internship like two years ago. And Mike clearly stood out as like the leader of that group. He was grabbing people together going through ideas like how to how to find deals. And he was just like a leader of that. So we ended up bringing him in more heavily and then more heavily. And today he's, you know, he moved up to Maui now. Him and his family, we just do life together.

And he helps like organize. Yeah. Right. So he over the course of now, if he would have just went and worked for bigger pockets, he would have, you know, it had been in Denver and I wouldn't be hanging out with him here in Maui. So it's much better now. But I love finding ways you can do that. And you can't always just go grab a huge intern team like that.

I recognize that I'm kind of lucky in that regard and that a lot of people want to do it. But you can find limited ways to work with people. I mean, one more example real quick. And then I'll, sorry. I just added this one. I had a video guy, and I hope he's not watching this right now. I had a video guy, local Maui here, who wanted to, he really wanted to work with me more heavily on video stuff. And so I had him film a couple videos for me.

And then he took the video files back to his house. And for a month and a half, for six weeks, he didn't upload the video files to Google Drive, where then Zach, our head of video at bigger pockets would take him and go edit him. He just never upload. It was like a five minute job for him to go and just upload, right? He never did it. And so then a few months after that, he's asking me, he's like, so, you know, I haven't heard from you about that job. Am I going to be able to work with you, you know, full time next year?

And I'm like, no. Like, yeah, like that was the interview. And that's what people don't realize. Like, that was the interview. Right. Exactly. So anyway, sorry. Let me jump in.

I want to comment on why they work so well. Okay. If you think about what your experience was like going to school as a little kid, you are following a system that someone else made. You sit in this desk from this time to this time. When the bell sounds, you get up, you go do here. You're allowed to do these things, but not those things. There's rules you have to follow.

When the bell sounds, you come back. Your brain responds to the environment that you put it in. Shelby, you can attest this being in the military, right? That's the first part of what you're doing is throwing out. everything that you thought you knew, and this is the systems that we use here, which is one of the reasons that people like Jocco Willink loved it, by the way, is he's like, I don't have to think. I just have to follow exactly what you told me to do, and it's easier. So what I'm getting at is people respond well to systems. Most people that you're going to work with as an investor have a W-2

mindset that was developed from every job we ever had, which was working in someone else's system. And if you think about every job that you worked, your first job, hot dog on a stick, McDonald's, you were following a system that some corporation made and you play the very very very last piece of it. Someone else drove customers in the door. They found leads. They created marketing. They developed a way to create the hamburger. Your job is a stand at the computer and do that last 1% of the transaction and collect their money. And so we start to think that that's all that work is. Just do this last part. We don't realize that someone else has done an insane amount of work to build this whole system that we can operate in. Okay. So as an investor, I see Shelby, you're loving this because

you recognize it. When I would struggle with an agent who couldn't do what I wanted them to do, right? This was a common problem. I don't want this property. I want that property. Why do they keep sending me this? Their brain is probably trying to figure out how do I fit into this person's system, but it's different than everybody else's. And so they don't know how they're supposed to bring the cash register at your store.

I would literally make this spreadsheet and give them a link to it in Google Drive and say, here are the 14 things that I am doing, work this. And then, boom, it made sense to them. Oh, okay, he wants this. And then after that, and then after that, I literally handed them the playbook for how to be successful with me. And what do you know? Deal started to come in. And then I could go to the property manager and say, here's my checklist for how I get a property ready.

Now, the cool thing was they ended up taking that, incorporating it into their business, and then they would copy that with everyone else. And several times they actually became so successful from that that they wouldn't work with me anymore because they had too many of clients. I haven't figured out that part. But the point is the system makes it easier to be successful. That's why we're talking about this right now. For the people that are floundering, it's probably that you're so unorganized.

You don't know what your target is. If you don't know what your target is, you don't know what directions move and you can't get going. Shelby, can you explain how you built the number of doors you did so quickly and maybe what systems and automation that you put into place to get you there? Gosh. So a lot of these systems were just built along the way. And a lot of our doors, I mean, so some of them are 100% me and some of them I've done

with some of my partners that I have here. And it's pretty cool, actually, in my, in my realty group, we do a lot of deals together. So, like, I've done a couple flips with my admin. I do a lot of deals with my agents that I have. So it just turns into fun and the fun compounds. And so that's how it's really happened so quickly. But I've done a lot of different strategies to get the number of doors that I have. So that very first one was the VA. Then I did 25% down conventional. And then I bought another VA house hack with, it was a quadplex. So I got four more there. And then after that, as you guys know well, I'm sure that, you stop your W-2 job, they won't, you won't get loans anymore in your personal name. So I went

through that whole struggle. And a lot of this comes from finding a way to win. Like, people tell me no all the time. And I'm sure people tell you guys know all the time too, but no is not good enough. It's just finding a way to make it happen. So no, you can't get a loan. Okay, well, how am I going to make this happen anyway? So I have used a lot of private money. I've done hard money. I use lines of credit. Lines of credit were a beautiful aspect of me being able to acquire. entire deals until COVID has really tightened that up a little bit. So the Burr strategy, I'm really big on once I had that private money or that line of credit, being able to recycle it by using the Burr strategy. Flipps, that's pretty self-explanatory for being able to recycle

the funds. And lately, I've just been doing a ton of Burr and bees is what I've been calling it. So it's the Burr strategy. But instead of a long-term rental, it's the Airbnb. Now, how did you find most of these properties? All different ways. So some of them were on the MLS. And it wasn't until recently, a faithful has become incredibly saturated on the MLS. And I think it's due to Alex Lee's talking about delayed financing, myself and my team being pretty loud about how great fanful is. And it still is great. But the MLS has dried up in a lot of ways. So a couple of these have been, there's a for sale by owner in here. There's the six unit apartment complex that I got was a for rent sign in the yard. And I drove by and I called it and asked if I could buy. And I ended up getting that one as well as a

duplex because he just didn't want to be a landlord anymore. And then courthouse foreclosures are really, really big for us right now. Can we pause there real quick? So, that's so good stuff. I took a lot. Sorry. No, this is great. This is right. Can you re-say real quick? Because I want everyone to listen to what you just said here about the for rent sign in the yard. Notice that she didn't say the four sales sign in the yard. Explain that again. Yeah. So for rent signs are my favorite thing to see, especially the crappy handwritten ones. Because I'm like, you don't, you're not a formal landlord. you probably hate this. So I saw the for rent and I called it and I was like, hey, just inquiring about this property.

And I was wondering if you might want to sell instead of rent. And the guy was basically like, please, I don't want it. And I have another one that I want off my hands. So, and of course it takes a lot of calls before you find that one guy who's willing to sell, but they're out there. Yeah, I love that strategy because it's, it goes to this analogy I've used before. But I'll say it again now, it's like sometimes when you wake up with a headache, don't think about taking medicine right away.

And so you just have this headache that's kind of like dull and brewing for a while. And it gets worse and worse throughout your day. And you just never think of taking medicine because it just started so gradually until then your wife walks in the room or husband or whatever and just said, hey, did you take some medicine? And you're like, I haven't even thought about that. Right. The same thing is true for rentals.

It creeps on these landlords over time and they hate it more and more and more because they're not good at systems. They're not good at processes. They don't have people. They write handwritten sides in the yard and they probably inherited the property from something or whatever. Right. So they've got a headache.

and they don't even think about the fact that they could sell it or until somebody says, hey, I know you had this property for rent, but any chance you want to sell. And if not that property, they might have other properties. I mean, every landlord's got a property. I would say almost every landlord has a property in their portfolio that they would consider selling, whether it's not the one you called about or not. So, you know, now of a sudden your options are millions of options out there of potential properties.

And you can go Craigslist. You can look on Facebook Marketplace for rent. It's just such a cool strategy, but it requires work. It requires a system like to regularly every week you're calling 10, 15, 20 of these people. And over the course of months, you might be able to pick up quite a few of them. It also requires you to be looking actively instead of passively. And I know a lot of investors now are obsessed with a tech option that will, they think that there's some program they can design that will scrub the world and bring them on a silver platter

at amazing deal with a motivated seller who will do 100% seller financing at zero percent interest. and all of their time is spent developing something to avoid what Brandon just described. But if you work backwards from why people give up deals, they don't want how you get good deals, it's you found a person who didn't want to own a property. You didn't find a database of properties that could all be amazing deals because if you do find that, Blackstone's going to come in and buy it before you ever touch them, right? You have to accept you're going to be boots on the ground doing some of this work that Shelby's talking about that Brandon's talking about to get that deal.

And that's maybe the first step. Okay, I'm going to have to talk to human beings. I'm going to have to find the human beings that I should talk to and target those properties. And I found that as long as you go in the conversation with the goal of solving their problem, the reception will be so much better. If it's like, hey, what problems are you facing? Is there any way I can help you solve them as opposed to I'm this hungry investor who wants to create a dynasty? Like, it's a different conversation.

Yeah. I have a question related to deal finding. and you being a real estate agent, but also an investor. I get this question a lot when I talk about new investors, I tell them, you should go check out, you know, for example, if you go to bigger pockets, go up to the navigation bar across the top, there's like network, you hover over that and it says real estate agents. So you can find agents on bigger pockets, right? Like what better way to find an investment savvy agent than somebody who hangs out on a real estate investment website, right?

But then I always show people this on the webinars and then I always get the question, why would I want to work with an investment savvy agent, though? Wouldn't they just take all of my deals? Wouldn't they just steal all my deals? Yeah. Okay, explain. What do you mean by that? And why is that not probably an issue? So I completely disagree with that.

I can see the point. A million percent I can see the point. But there's so many pros that go along with working with an investor savvy agent, understanding the language, understanding how to run numbers, being able to ask the right questions to a potential seller, off-market deal, wholesale, or all that stuff, to present you with an opportunity that is completely different than trying to talk to a normal agent. Like, it's a completely different conversation. But more to the point, which I believe is the scarcity mindset type of thing, it's like they're going to take all the good deals.

Yeah. Okay. First of all, I can't buy all the good deals. Neither can any of my members on my team. We can't take everything even if we could. But also, if there was ever a direct competition about a client, who wanted a deal and I also wanted it, 100% of the time, that deal is going to the client. Because I know that deals come, you know what I mean? Like there's a million deals. There's tons and tons of opportunity. And even though like for our market in particular, deals are scarce on the MLS, it's finding a way to win. And what we've done is we have capitalized on off market properties. We have a real estate investors meetup where we promote wholesale deals. We try to get wholesalers to come in and essentially give their properties to

us and we've created an off-market MLS tracker for our clients where we hang all of our wholesale deals as well as our courthouse foreclosure properties because in this county in VATO North Carolina, the courthouse foreclosures are not listed on the MLS and it's an archaic terrible system that if you are not ready to put in a shit ton of legwork, you're never going to find that deal. So we have, again, built a system to capitalize on off-market to give our clients more options within this market. Yeah, that is so good. Here's the truth about passive investing.

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visibility at Indeed.com slash rookie. Just go to Indeed.com slash rookie. Right now, and support our show by saying you heard about Indeed on this podcast. That's Indeed.com slash rookie. Terms and conditions apply. Hiring Indeed is all you need. All right. So you mentioned you have a meetup. Can you explain?

What does that like? Can you walk people through that? Like what's yours like? And then for people who are attending, like people who are listening to the show right now saying, I want to either start a meetup or attend a meetup. Like what should they expect and what's worked well for you? I have a checklist.

I can send you if you want to start your own meetup. Yeah, of course I do. So ours is called pints and properties because it started at rotating breweries and you drink a pint and you talk about real estate. And it all came from the fact of when I was first getting started, I felt like there was a gap in our community for a place for like-minded people to get together and talk about lessons learned and stuff like that. So pints and properties was born. And what we do, it's once a month on the second Saturday of every month at 3.30 and 5th, if anyone wants to come. We start with an educational portion. So we'll generally have. have a guest speaker come in and talk for no more than 30, 45 max minutes on very quick information that everyone wants to know. And then after that, it's just complete networking. And people usually stay out for far longer than I'd expect because whenever there's beer in real estate involved, people just get really excited. And it's turned into a really good community that draws in wholesale deals that draws in the right vendors, that draws in community. Like it's, yeah, that makes sense. Yeah, I think that's great.

It's, it's, I think people get a little bit intimidated by the idea of a real estate meetup. Because they think it's going to be some super like weird formal thing. Everyone's handing out business cards and, and almost every, all the good ones I've ever been to. Have usually been at a brewery or at a something that's a little more casual, you know, somewhere at colleges. I know David, you rent out a space, don't you? Like, where do you do yours at, David? Now, like, here's there like in a class. Right now we don't do them anywhere.

Oh, yeah, shut down. But yeah, I rotate all over the place because it's hard. We either outgrow the space or they want to start charging people. So then we have to charge the people who come. And I try to always look for free spots to avoid that. We found a comedy club in the Sacramento area that we were able to start doing those at. But if you've got a thing like a show. Do you tell jokes?

Yeah, like knock, knock jokes. I just flew in from New York. Boy, my arm's tired. Yeah, that's a really good one. Yeah. I'll be here all night, folks. Yeah. Okay.

So again, they don't have to be. stuffy formal things. You don't have to show up in a suit usually. Like, I mean, there might be some people out there that do that. But yeah, they're relaxed and they're fun. And they're, and they're such a vibe of like, let's help people to like, let's do this together. And that's something that I think a lot of people don't expect in when they get into real estate investing. It's not what you see on TV of like cut the road. I'm going to beat you and we're going to take, you know, I'm going to take all the deals and bankrupt you. Like it's such a cooperative environment, the real estate investing space. Because most people don't have that scarcity

mindset. There's always the one oddball who's like super weird, but like most people are like, yeah, there's lots of deals. Let me help you. I'll tell you exactly how I did my last deal. I'll show you how I just found that deal. I show you who my lender is. Like people are usually pretty pretty open because they know it's going to come back to them in the end. Totally, totally agree. I found that absolutely in my experience as well is like the people I surround myself and myself, we give away everything we have essentially because by all means, go forth and do great things. And even with direct competition, like other agents and stuff, like I give away all of our tools,

all of our checklist just because I want, you can go be great too. Like it's, you know. Yeah, that's awesome. If we can, could we toss in the link to that checklist and how to like start a meetup, a good meetup and just put in the show notes. All right. We'll put in the show notes at biggerpockets.com. So I show 406.

Again, biggerpockets.com. So I show 406. I'll put the, uh, put the link. there to that checklist, which would be awesome. So good. So where are you headed? Where are you headed in the future? What do you see your business looking like? I mean, you got fit. Wait, what did you say 50 units now? I have 51, yeah. 50. Yeah, that's awesome. 52 indoors. All right. So where do you see yourself headed? Okay. Actually, physically to Charlotte. Yeah. So we're in Fayville right now. And I myself and one of my partners, Michael Glassby, he's fantastic. We're moving to

Charlotte and we're going to start another pillars out there. So we're doing that. We're also doing consulting to help agents on how to work with investors because we found that they need help. And more deals for sure. But I've decided, people ask me this all the time. They're like, why aren't you into apartments? Why are you doing these small deals? Like get into bigger deals. And so what I've been doing a lot is I've been reflecting about on what makes me happy. And the idea of that doesn't make me happy. What I like to do is I like to be really creative with projects. So I'm really enjoying flips lately and I'm really enjoying Airbnb's. And I want to start a, like a quirky Airbnb business where each Airbnb is like a complete experience as opposed to

just, you know, a cute property. That's so good. Have you read the book The Power of Moments? I haven't. That's so good. Yeah, that's your list. I'd recommend that to everybody listening. I need to actually get those two guys.

Chip and Dan Heath. They're like brothers and they're really smart. Anyway, they wrote a book called The Power of Moments. And it's so good. It's all about like what people remember is those special ones. you know, 1% of their day moments, like whether it's on vacation, whether it's at Disneyland, whatever. They don't remember the mundane and the boring. People remember the magical moments of life. And so it's all about how to incorporate more those magical moments in life. And so

like quirky Airbnbs are a good example that. People will remember like, there was like, there was a bright pink telephone. Like it was crazy. You know, like just something stupid like that. But people love like the quirky things. And that makes them happy long term. For sure. Yeah. Totally agreed. Yeah. Yeah. All that. And then world domination also. All right. You know, just a little bit of world domination. I like it. Military experience will come in handy for that. You might need to use some of that. All right. So next, I want to move into the next segment of the show, which we lovingly refer to our as our deal. Deep Deep Dive. This is the part of the show where we dive deep into one deal that you've done recently.

Do you have a property in mind that we can kind of dig into and ask a bunch of details? I do. Yes. I have one that it's like in the middle of. So it's the freshest of the mind. But yeah. All right. Let's do it. Number one. Yeah, I'll start with, what kind of property is this and where is it located? It's located in Fayetteville, North Carolina, and it is a single family, and it's a Burr and B.

Okay. A Burr and B, single family in Fayetteville. And can you restate what a Burr and B is again? Yeah. So that is a Burr, which I think everyone knows what Burrs are. You can explain anyway. Go ahead. Go ahead.

Okay. It's when you buy, you rehab, you rent, you refinance, and you repeat. But generally, traditional burrs have been with. long-term tenants for the rental aspect, and this is with short-term. So the Burr and B play is just like an Airbnb mixed with a bird. It's like they have like a little baby. And that's what it is. Yeah, it's a super powerful. Brandon is secretly pinching himself that he did not think of that. He always comes up with the clever names. Good job, Shelby. Yeah, I take that from me. I like, it's the Burr remix. Okay. For this particular deal, how did you find it? This one is a courthouse

auction foreclosure. So it was off the MLS and it was one of those deals. that my team pulls from from the courthouse. Which, by the way, quick plug here. Bigger Pockets recently launched a book called Bidding to Buy, a step-by-step guide to investing in real estate foreclosures by our good friends, Aaron and Mucoseggy and David Osborne. No relation to you, though, correct? Because you have different last name spelling.

I love him, though. Yeah, David Osborne, he's pretty awesome. Aaron's not too bad either. All right. Good dudes. Next question, how much was the property? Okay, purchase price was $52,000, and the repairs were 14.

and we put eight aside for furnishing and set up. So all in, we were at 76, 4, 76, so 76,000, essentially. And how did you negotiate that price? There is no negotiating with the courthouse there. It is what it is, man. So how it works with our courthouse, at least, is you have to put in a bid, and then there's a 10-day upset bid period where the next bid has to be at least 5% greater than the following bid.

And so you just have to cross your fingers and that hope that no one outbids you in that 10-day period. That's a weird way of doing it. I mean, like, just different than what I've heard before. Usually it's like, you know, it's now everybody, like, we're selling it this morning. But that one drags on like an annoying eBay. Yeah, if they're on the MLS, it's like that. It's like, yo, get your offers in. And there's a highest and best period.

But the courthouse is not linked to MLS and they're literally an archaic system. It's ridiculous. Interesting. And actually, one reason I like the idea of foreclosures. And I've had some, you know, big success with foreclosures as well is because it's archaic, it's annoying, it's complicated, it's sometimes difficult to figure out, it changes in every county across the country. There's little unique things. So in other words, it is hard. And I love hard things. Like, yeah, because hard things means that everyone else is

going to go run away and go watch TV instead of figuring out how to do it. So the more you can run toward hard things in life, the more successful view would be at almost everything. All right. All right. Number five, how did you fund that $76,000? Yeah. So this is one that me and one of my agents are doing together as a fun project. And we each have lines of credit. So we each used our lines of credit, which are just 8% interest only to split this 50-50 for the 76,500, all in. The lines of credit, when you said, are these like home equity lines of credit on your house? Or these like private bank line or from banks or private lenders? What's this 8%? Right. So before COVID, there's First Citizens Bank is here at North

line. And I think it's a couple other states as well. And literally one day I just was on a mission. I was like, hey, I'm going to find some lines of credit and went to a couple banks and went in for citizens and was like, hey, I'd like a line of credit. How do I do that? And I walked out with $76,000 in lines of credit. That's awesome. One's a personal and ones of business. And then I told all my clients about it and it was great for a while. And then COVID happened and they've shut it down. But mine are still open. Yeah, a lot of lines of credit got shut down. I actually set a goal for myself by the end of the year. Like my company, we all set like these mini gold, call them rocks from the book traction. But one of my rocks, yeah, I love that book. Like one of my rocks is to establish

several hundred thousand dollars in lines of credit by the end of the year. Because I just like, I have some paid off properties and I've got good credit and I got a good income. I'm like, why don't I have just a bunch of lines of credit? I should have that. Or at least like a line of credit that's nice and large and in charge. So anyway, I'm working towards that. If anybody knows of any lines of any good lines of credit companies right now, go ahead and put them in the show notes of biggerpockets.com slash show 406. Help everybody out. If anybody knows any good banks that are lending right now on lines of credit, that would kind of benefit everybody.

All right, that's very cool. What did you do with it or what are you doing with it? You said it's the Burr and B. Burr and B, yes. So it is currently in the rehab process. It's almost done. Our Airbnb designer has already started her piece of the puzzle, which, by the way, I don't like to.

So when tasks come in, this is back to leveraging. Again, when tasks come in, I don't think when am I going to do it. I think who is going to do it? So when I first started getting into really an Airbnb's, I was like, it's fun to think up the ideas, but I freaking hate ordering three sheets, three duvays, counting knives. Like, I'm not going to do it. So I had one of our real estate stagers who was fantastic. I just called her and I was like, hey, you're ready to like take it up a notch? And so now she's created a whole business on taking the rehab's property and getting it fully furnished and ready for the property manager to take

over. So that's so good. Yeah. So anyway, she's doing her piece right now. The rehab's all almost done. And then we've actually already started the application for the finance, because it's not a refinance for this one actually, because it's a delayed finance because we bought it cash. And then the ARB is 110. So we plan to pull out everything that we put in. Can you explain delayed financing real quick? I know we covered that back with Alex Fulis. I think it was like show three, well, the 301. But can you kind of what is delayed financing? Because that's a really cool strategy that I've never personally used, but I really should be using it more often. So we use it a lot and our clients use it all the time. And it is essentially, it's truly when

your financing is delayed. So you buy a property cash and you make sure that your entire rehab, all of your costs associated with the purchase are on the closing disclosure or the HUD. So all of the costs for the project are right there at your first closing. And then you do the rehab. And as soon as the rehab is done, there's no seasoning period. That's the difference. There's no seasoning period, you can start the finance process immediately, and they will give you 75% of the ARB or the max that you put in on that closing disclosure, whichever is less. Which is why you want to put the rehab cost on the HUD one. You have to throw everything on that HUD at closing or else you're going to miss on pulling

that money back out. So the benefits of it are speed. It's the speed process of it because it's not like with a, you know, a regular burr, you have the opportunity to potentially cash out. extra if there is extra equity. So there's no cash out involved, but it is a great way to very quickly recycle funds. And do all lenders do that? Is that a Fannie Mae and Freddie Mac thing? What do you know about that? So it is Fannie Mae and Freddie Mac. If you do it in your personal name, you can do that and you can do it up to 10 times with the Fannie Many rates, which is great. And then you can do it on the LLC side. The rates are a little shittier. You can still do it. All right. Very cool. So that's the plan is you're in process right now of

refinance, basically not refinancing it, but financing it or refinancing. Exactly. Because in theory, you're leaving nothing in the deal. If you're getting your numbers, right. And in case people are a little confused. Let me just explain one thing. When you say you bought it, you said you used a line of credit, but then we're talking cash, like, you know, using air quotes around my cash, right? Because the line of credit, you didn't buy it with a lien, like you didn't go get a mortgage on it to buy with a line of credit. A line of credit, you can go buy like a really expensive dog if you wanted to with that line of credit or you could buy whatever. That's basically you took the cash out of the line of credit, now that's your money. Like it's cash and now you

bought the property. So it's not a lien on the property. That's what you mean by, so you bought it cash, which is why, another reason why I want to do that a large line of credit is so that I have this ability to buy things for cash. Exactly. But it's really not cash, but it is. Exactly. And that is the stipulation that I don't think I emphasized clearly enough for at all is that in order to do delayed financing, there cannot be a lien against the property, which is why I said cash. So you can use true cash, you can use a line of credit, a HELOC or a 401K, anything that's liquid verifiable funds. You can use private money too, but there are, you have to be careful, which I can tell you if you want, but you have to be careful about how you do that. Interesting. Okay. Yeah,

I mean, I'm guessing that they can't have a lien on it. Is that the idea? That's the idea. Yeah. Yeah. Okay. It's okay. You can't have a mortgage on it because you're not doing a refi. You're doing a financing, just delayed. Correct. All right. Okay. When normally we ask what the outcome is, but it's still being built so it's not finished yet. Do you have projected numbers for how you think it's going to perform? Yes, I do. And I actually ran them on my bigger pockets calculator before because I figured you guys would ask. Okay, so we have several Airbnbs that are similarly located and size, beds, baths, amenities and stuff like that. And after after everything is considered, including property management, all expenses, we're looking to profit, cash flow

about $1,000 a month. It's $933 is our projection for this property of pure cash flow after it has been financed with the mortgage and all of that. Do you expect to get all your money back? Or you can leave any in there, do you think? I expect to get it all back. All right. So almost $1,000 a month, no money invested at the end of the day. That sucks. That sucks. Do a little better next time, Shelby. It's terrible. But it is, I mean, it's crazy. It's great numbers, especially since like property management for Airbnb, because obviously I'm not going to manage it. I can't do that. It's anywhere from 25, we're down to 20%, because once you have X amount, then they'll drop the management fee, we're down to 20%. But so even that cash flow accounts for the 20% property

management, the two times a month lawn care, all of the utilities that we have to pay, and we're still walking away with 933. That's awesome. And I love that you said pure cash flow. That's the phrase that I'm trying to use more often because like there's this misconception when we talk about like, there's cash flow, which is like, oh yeah, my mortgage is this much and this is. how much my rent is. I'm making $800 a month or $1,500 a month in cash flow. No, you don't got to account for the property management and the repairs and maintenance and all that. Now, hopefully with the Burr and B, you have fewer repairs of maintenance, but things will still break. And I'm sure you're accounting for that. And like, you account for all the actual

charges you will get long term, even if they don't happen every single month regularly. And you get the actual pure cash flow. It's gone through the fire and came out the other side. And that's, that's the way you get real estate and get some good cashful. I do love the, which you touched on is that you'll hopefully have less maintenance and repairs and stuff like that. For those of you out there considering Airbnb's, I do love the fact that there's turnover frequently because then we have a cleaning crew, you know, our property managers walking it and making sure that the property is not distressed. And then also, if you think about it, Airbnb's generally people come in at night, they drop their bags, they go out to eat, they crash and then they leave. So if you think about the wear and tear on a property,

in theory is significantly less than a long term. Yeah. Yeah, that's cool. I love Airbnb. I'm like it sucks like someplace like with COVID. Obviously that hurt a lot of the Airbnb industry and the vacation rental industry. But it'll bounce back. You know, like it's one of those things that we couldn't have predicted kind of a black swan event. Like you know they shut down pretty much all Airbnb is in Hawaii like the whole state. Like they made it illegal to rent on Airbnb or any like you, you just can't rent anything. Condos, nothing. It's zoned right. They shut it all down. They just don't want visitors here.

So again, like not counting things like that, which are just absurd that we never stop counting. I love the idea of vacation rentals. Very cool. And Buryne combining that, that's genius. All right. Last question here. What of the DL deep dive? What lessons did you learn from this project?

So I'd like to, like off market properties do exist in places other than wholesale deals or drive for dollars. So that's something that I thought is a good takeaway. And then the other thing is there's always new financing strategies to find. And as long as you are continuing. learning about different strategies to finance properties or refinance or delayed finance, the more opportunities that you can have on hand, the easier you can do creative things with different deals. Because a lot of times a deal will come in and you'll be like, oh, that doesn't work for me. But it might if you knew about doing X, Y, and Z and tying these things together.

So it's really about continuing to learn and building your toolkit. Yeah, that's really good. Really good. All right. Well, that was the deal deep dive. It was fantastic. I think people are going to get a lot out of that one. And again, I see a lot of potential in the future, especially as people start traveling again. I think that's a really cool business model that a lot of people here are going to make a lot of money off following and modeling. So thank you. Let's move on to the last segment of today's show. It's time for our Famous Four. All right, but before we get to the Famous Four, we've got a whole Bigger Pockets podcast network out there. So let's hear what's happening this week. Hey, guys, it's Felipe from the Real Estate Rookie Show. And last Wednesday, we had

Prescott on the show who talks about using his parents' Helock to invest in real estate, creating that true generational wealth, graduating college with no debt, doing a full-time nurse, serving in the military, and investing in real estate. You got to go listen to the nuggets that he drops. Make sure you go back and listen to last Wednesday, Prescott. All right now go check out that show right as you finish this one. And now, let's get to the famous four questions. Number one, Shelby, do you have a favorite real estate related book? So that's a hard question. And I'm going to say that my favorite is how to invest in real estate by you and

Josh Forkin because I use it all the time with clients when they're like, how do I get started? And I'm like, go read this book. Thank you. That's fun. Did you know the original title that book was going to be called Start Here? Like we changed the title at the last minute. But because that quite people are, how do I get started? We're just going to be like here, start here.

And that was the idea. But we didn't think it was. I know. We like to have very long, complicated titles. Like the book. blah blah blah so anyway thank you that's the first time i think anybody said that i think on the show so warms my heart next question number two number two what is your favorite business book so my favorite business book is not exactly a business book but it's crap i threw this up every time i try to say it

it's a millionaire morning millionaire no that's wrong the david osborne one that yeah Mirable warning millionaire, damn it. So that one, and it's funny because it's literally my favorite book, and I always script the title, I should have written it down. But that book has changed my world from a personal, but also from a business standpoint, with how you start your day, how you're really intentional with what you do, helps you prioritize things well. So I think that that book above all other.

Also, I do love traction. And we both mentioned that earlier. So it's a great one too. Yeah, we're actually hiring an EOS, which is the model that traction uses, like an implementer to take over a whole business and like a consult us on how to be more perfect on the EOS model through traction. Yeah. That's awesome.

Yeah. That's be good. All right. Number three, David. When you're not buying every single property in the Carolina is running the top producing real estate team that you have, jumping out of airplanes and being an overall awesome person, what are some of your hobbies? I love to learn stuff.

I have a very strong sense of curiosity. So I like philosophy, psychology. anthropology, history, stuff like that. I'm learning Spanish right now. And then I love anything that's physical. So I like to work out, but I also like to, you know, climb mountains or, you know, surf or ride horses or whatever, stuff like that. That's awesome. Very cool. Well, we'll have to get you out to Hawaii next time we do one of those big mastermind things and we'll surf. It'll be fun. I'd love to go. Number four, what do you think separate successful real estate investors from those who give up,

fail or never get started. I think it's ownership. I think that people don't truly understand how much they can control if they wanted to. And the minute that they start blaming someone else is the wrong answer. So even if like, oh, well, we didn't close on time, my instinct is, did you check in?

Did you call them the week before and say, how are things going? Can I help with anything? Like, do I owe you anything? So like literally ownership and you have the impact to control your future. That is one of the best answers I think I've ever heard for that question. I love it.

That was, yeah, really, really good. And that's a common theme that we see from successful people is they say, everything is my fault. They just look at everything that way. And they don't beat themselves up and use it as an excuse to say, I suck at life. Everything's my fault. It's more that you empower yourself when you say, this went wrong. And that's because of me and I can fix it. That's awesome. All right, Shelby, for people that want to learn more about your awesome ways, where can they find out more about you? On Facebook, Instagram, Real Estate. with Shelby Osbourne and Shelby Osborne.com or Five Fillers Realty Group. Definitely check out my team. They're pretty bomb. Very cool. All right, Shelby. By the way, what are the five pillars?

I'm assuming you have like five pillars. You do. Yeah, so it's an acronym and it's N-Cap, which encapsulates what we stand for. So it's education, networking, creativity, action, and perseverance. So good. Thank you so much for being a part of the show today. I look forward to just seeing where you're headed in the future. And appreciate I'll help you get back to the community, the Bigger Pockets community, and those investors in your market, you're making, you're making a big impact. So thank you. Thank you. Thanks so much for having me, guys. It was super fun. Thank you, Shelby. This is David Green for Brandon making traction Turner. Signing off. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn

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