KGCI: Real Estate on Air - 26 Flips in 12 Months as a REALTOR

Episode Date: January 24, 2025

Welcome back real estate rock stars. This is the first ever super special treat for you today where myself and the guests are in person recording this, which has never happened before since I've taken over as host. So today's the day for YouTube, if you want to go check it out on YouTube. But it was about a week ago when I had my buddy Jay Miranda, he was popping on to record his episode on Rockstars. And I was like, dude, like you're in Vegas. And he was like, yes, I am. And I was like, I'm going to be in Vegas next week for wealthcon and the traffic and conversion summit. And I was like, do you just want to do this in person? And he was like, I have a full studio in my house. And so we are actually in his house today, Jay Miranda. And yeah, listeners, this is going to be a really good one for you if you are interested in flipping in particular.

So Jay has been in the game since 2015. He was a dealer in the win casino for a couple years before that. craps dealer, not just a lowly blackjack dealer, which I just found out was like actually a difference there. And since getting his license, he started out with like retail and then, um, now primarily flips and uses his license both to acquire deals and to sell on the back end. He did 26 transactions last year in 2020. And so today, um, we're going to hang out with Jay Miranda. Thanks for coming on the rock stars. Thank you. What is up, Shelby? I like that you added in craps dealer and not, blackjack dealer. Yeah.

Well, it's because I just found out there's slums. No, nobody cares unless you're in the industry. And then when you're in the industry, you're like, blackjack dealer, no, I'm a crap dealer. Dude, okay. Well, talk. So let's go back a little bit. And let's talk about like, so you were a dealer.

Why did you get into real estate your license and kind of like your journey up until this point? So I started dealing on East Coast in 2009. And then, but you could do that at 19 on East Coast. Out here you have to be 21. So I worked and saved, worked and saved, worked and saved. And when I was watching TV, Vegas, like the world was burning, right? It's like in the middle of the Great Recession.

Everybody's talking about how all the real estate in like Las Vegas, Phoenix, and Miami is dirt cheap. So when I'm looking at the TV, I'm like, I have to find some way to go to either Vegas, Phoenix, or Miami because I need to buy property. So I'm like, I'm already a dealer. If I'm a dealer in Las Vegas, I'll make twice as much money. I'll never have to deal with snow again. I don't have to deal with state taxes. and I could like pick up property. So I started buying in 2011 and 12 out here for dirt cheap, right?

And then we were talking a little bit off air about like the one that I cleaned up on, bought it for 74, sold it for 160, thought it was a genius. And then right now it was worth like $310,000. And but I started buying property then. I always wanted to be an investor. And then, you know, I was working at the win. When it was like a really good job is the top of the dealer. industry, but I'm like, I can't get any higher than this.

You know, I mean, it's arguable whether a Cosmo or Bellagio or any of those is a better casino, but I'm already at the top of the dealer game. I have to do something else. And that's when I got my real estate license, quit my job. And then I want to get my real estate license and be a realtor, even though I never wanted to be a realtor, I wanted to be an investor, but I knew that being a realtor would get me closer to investing, that I would have more knowledge of the community, really know the game a little bit more, and I'd be more prepared for when it's the time.

And then, so when you got your license, did you primarily work as like a normal realtor for a couple years before you started flipping? Or like when did the flip come into play? Yeah. So I got my license in 2015. I was still working at the casino. But I went to Graveshift so I could be a realtor during the day. And then from 8 p.m. to 4 a.m. still throw cards at people. And worked with like one company.

And I got lucky with Zillow leads back then because it was still working. worth it and it was still cheap. So I spent all my money on Zillow Leeds because I came in, I was always really good at working and saving. So I spent a lot of money on that. It started really working for me. And first year, 2015, I only made $14,000, but 2016, I made $87,000 as a realtor. And then 2017, I made like $114,000 as a realtor. And I bought my first flip in December of 2017. Okay, gotcha. So you worked your way up using Zillow leads. And I think, you mentioned before when we talked that you used Facebook ads too yeah I got into it but I didn't know it as well as I do now if I knew about click funnels like I knew back then I got a lot of people

interested but all the leads were trash because when people start when people start looking on zillow and they call you to show the home they're ready right then they want to see it but when people start looking when they start clicking on houses they're like two to three months away and you need a way to drip on them so like the Facebook leads you could get way more leads but those leads are two to three months out and I didn't have the system to really collect them and I just wasn't as savvy with like all of internet marketing back then. Yeah. Yeah. Well, it's like it's a whole world that I'm like diving into now and find it very interesting. But that's a conversation for another day because I want to make sure that we really hit on like the realities of flipping because there's

so many real estate agents who are like, you know, flipping is my next goal. I want to get into the investment space and I really think that flipping would be a great way for me to generate like mass amounts of cash. So can you talk about, I guess, your journey, like, flipping. And what I'd really like to hit on is, like, realities of it. Yeah. So in realities, because we were talking about your one flip from the 1800s, which is so much downside to that.

But, like, how did I get started in flipping? Yeah, yeah, yeah. The catalyst to where I was probably going to end up flipping at any point anyways, but within being a realtor, I worked with some investors, and everyone's an investor until it's time to pull the trigger. So I get them into this house. Great deal. Perfect deal.

Right. And then they just back out of it. And they're like, hey, you know, we just want to put our money somewhere else. We don't want to do this right now. I'm like, dude, do you know how good of a deal you have? If you could just buy this right now and then we could put it back on market tomorrow and you're still going to make $30,000. You could just do that right now. And we could still go through with the sale.

They're like, no, we just don't feel like it. And I got them such a good deal. And they just threw money in the trash can. Like in my eyes. I'm like they just threw money in the trash. I'm like, I can't rely on other people. I'm just going to do this myself. People get in their own way.

They let the tiniest little things have them back out of contract. And they should just went through with it. But with how it got started, you need money to be a flipper, right? And there's ways that you could do it without money. But all the ways that people say to do it without money, they're like, oh, yeah, partner with me. And they want to take a really good deal. And then they want to make all the money from it, right? And they're not going to partner with you unless it's like a

grand slam deal, right? But realistically, you need a little bit of money. You need at least 10% down enough to do the rehab. Okay. You might, back when I first got started, they wanted you to put 20% down, especially when you had no experience and the money to do the rehab. So on some of my first deals, my first slip was when 2017, that was off MLS. And everything I bought in 2018 was either off MLS or another realtor saying, hey, Jay, I got one for you in case you want to take a look at it. So everything was within me using my real estate license. But, you know, realtors, we have drip systems and, you know, all the, you know, the auto searches.

So I set up like 20 different auto searches, right? For myself. Yeah. And it's like, here's Old Henderson, this area, this square footage below this price. Here's Spring Valley, this area, this square footage below this price. Because you can't just do, if you do like just the cheapest price for square foot, you're only going to get one zip code in your part of town, right? you're probably going to get the worst part of your town.

So I specialize like certain areas in this one, anything under this price, because I knew that would be a deal. In this condo community, I knew anything below this would be a deal. And I like really, really specialized it so that I could pick up on deals that other people aren't going to see. They just go on lowest price for square foot. And I had a million searches and I just put out tons of offers. Okay.

I want to break this down a little bit. Okay. So if like there's an agent who's listening and they're like, I really wanted to get into flipping for myself, step one in which they could do is identify which areas. So because hypothetically, if they're already an agent in their market, they already know kind of like where the hot areas are. And I guess maybe elaborate a little bit more on that because so the step one would be to set up campaign like drip campaigns for yourself. So you're notified when potential deals hit the market. But picking a location. So here's what I like.

So what I like is areas that there's going to be a little bit of deferred maintenance. Deferred maintenance means they should have been doing work to their property and they didn't. So you want areas like in Las Vegas, anything under 1990 or 1980s old, right? So I was looking for areas like 1960s, 70s, 80s, maybe even 90s that had a little bit of deferred maintenance. Maybe somebody has a bunch of trash in the front yard. Their paints a little bad. Their carpet's bad. You know, stuff in their house just needs replacing.

But when you get too old, it's complete tear down. even though my first house was a complete tear down, but you want to be old enough to where there will be some deferred maintenance, right? So that's step one. I wanted areas safe enough to where I'm not going to get broken into because that's a thing that's going to take up all your time and that's going to stress you out like crazy.

If you're a realtor, you're probably hopefully already making some good money and you can make more money being a flipper. I want you to be like a flipping empowered realtor, not somebody, like if you were a realtor and being a flipper was just part of your tool belt. You know how the one guy from bigger pockets always says, like if you have a hammer, everything's a nail,

if you have a screwdriver, everything's a screw, right? This is just another tool to where if you saw something that would be like a paint and flooring flip, you can make the money off that. But I was looking for houses with deferred maintenance and areas that are still safe, because when I get broken into, those are the things people don't factor in,

and it takes up so much of your time, so much of your stress. you're getting gray hairs, you're pulling your hair out. Like, it really, really destroys your life when you get broken into a lot. And people don't factor in how much mentally it destroys you when you get broken into. Yeah, it's so weird. So I did, I've done, you know, a bunch of flips throughout my days as well. And that's something that, like, I've actually never had to deal with.

Yeah. It was like break-ins. Yeah. And when I was thinking about, so to add on to what he was saying about deferred maintenance and somewhere that's safe, like I also used to think about in Fayetteville where I did flips. It was like three-two. So three-bed, two-bath with a garage is what everyone was looking for in the specific school districts. So basically, and I also, and I don't know how you feel about this, but I used to think about like what is the, you know, the most common, the average price point in the market,

because that's the ones that are having the most interest and are more likely to sell quickly as opposed to going for one that may have a large upside, but, you know, a really, you know, high price point, but we'll sit on the market forever. So. Oh, yeah, go on. So as a flipper, you want 80% of after repair value minus repairs in other neighborhoods and maybe for the more older neighborhoods or for parts of the country that don't sell as well. You probably want to do a 70% of ARV minus repairs. But 80% of ARV minus repairs. Let's put that down a little bit.

So ARV. ARV meaning after repair value. Okay. So what it will, what it will be valued for after all the renovations are done and you're ready to list it. Correct. Okay. So like if it's a, you know, a $500,000 house, and so 80% of that is $400,000. And if it needs $40,000 repairs, then you're getting it for $360,000.

That's what you need. And that should cover your holding costs. But in, I'm getting something's cheaper in late of 2023 because things are taking longer to sell. Yeah. So we need to get below that point, right? In certain places, you need to get lower numbers. if you are in the southwest, that 80% of ARV minus repairs should work for you. I think maybe if you're in some parts like northern parts where it snows or the property values

just aren't that much, you might need to get a lower percentage. Okay. So step one is identifying the searches in the areas that you want. And then once the properties come in, step two is like the analysis, which is kind of where we went into now. So the deal comes in. And then if you're the agent who's considering this for their flip, you have to run comps on what it will be worth after you do the renovations.

And using that number, depending on your market, it'll either be 80% or 70% of that number and then subtract out repairs. And that is... And this is where being a realtor is like the biggest benefit, because you should really know not only what the after repair value is, but what sells and doesn't sell in your neighborhood. So we're like a rookie or somebody who just took a course off, street might go and say, hey, here's the house off of the main road and they're doing all the

comps and they're like, wow, I should be, I should be able to sell this for 500,000. If you're a realtor, you know, oh, because you back up off that main road, you're going to sell it for 30,000 less and everybody else around you. No one wants it. Yeah. Or like the really steep driveways. You know, like there's just those little intricacies that you're totally right. As a real estate agent, you just have more insight as to what people are actually interested in.

And I think that that's the thing, too, like I hear agents a lot be like, oh, like, I want to flip it. I don't know where to start. But you do. If you've walked houses with buyers, like, you know what they want. So, yeah, super powerful. Some of the other things I think is really good for agents is, so one, they really know the ARVs, at least they should. But some of the bad things that I see from agents is they don't count, they're not counting all the math. They're not using, they're not doing all the quiet costs.

They're holding costs. They're selling costs, all the costs that aren't the rehab. As a realtor, you should know that if I bought a house for $330,000 and sold it tomorrow, without doing anything to it for $360,000, I'm probably going to break even off it. Right. So, I mean, some realtors I see are like, hey, Jay, here's a great deal. Everything else in the neighborhood is $360. You can buy this for $330,000 and it needs like $20,000 repairs.

So you can make $10,000. You know, better than anybody I'm not going to make. I'm going to lose money tomorrow if I sold it for the same thing. Right. Bake in enough costs to where you make a profit off it and that all your holding costs are accounted for. And you need to spam out a lot of offers. So if I'm doing MLS offers, I'm probably getting one out of 20 or getting accepted. And one of those 20 aren't even getting accepted right away.

They might, I'm going to have contact with the agent and be like, hey, Jay Miranda, I'm an agent two. Like everybody else is just going to try to wholesale this property. You know, I'm not trying to do that. I'm an buyer. An offer from me is not an offer. it's a sale like just pick me i love that you're a realtor it's such a good line yes it's not an offer it's a sale jay and rando ladies and gentlemen and you go in and you know what realtors want here but they're still going to go with the highest priced offer then that highest price offer is going to come back on them

with something else and then they'll call you like a month or two months later yeah so even my one out of 20 that's not even right away that's me like paying the long game to like two months later three months later and they get backed out. Okay, so let's say that the people listening, they have the deal, they've identified the deal, they've run the numbers at least really roughly because we didn't go in the weeds as to like repair costs and all the holding costs and cost of sale and all that stuff.

But the next piece, what is the next? I was going to say financing. Like I'm curious about how you're financing this, but like let's get like more granular. Are you having, you know, let's say you find the deal. Are you having your contractor walk the property? Are you walking the property and doing the... Initially, I did.

If you are reading a book or taking a course or something, they're going to say have three contractors come out to each property. Yeah. I mean, once you're doing like 30 properties a year, that's a little obnoxious. I just know how much it's going to cost. I know how much my contractors are going to charge me. I'm not having them walk the property these days.

But early on, you have to protect your downside. So have multiple contractors walk it. And hopefully if you're a realtor, You have contacts and you could probably go in your brokerage's Facebook group and be like, yo, does anybody who does flooring or paint or this? And you could probably get some good referrals who are patient enough to deal with realtors who suck. Okay. So like there's going to be some good painters there.

And you have to get a few because some are going to charge you way too much. Some are way too little. And hopefully you're a good realtor and you're good at negotiating things and you can get them lower in price. You should have a skill set already there of negotiating people. I was like, okay, this is flipping for agents who already have experience as an agent. Yeah. It's not so much for the newbie. If you're not good at negotiating, you probably suck as a realtor.

Like, hopefully you've already done this before and you have some people in your pocket. Okay, gotcha. So all of this already sounds like a lot of work. Like so much work. So I want to come back to balancing real estate agent, like retail business and flipping. Yeah. But I want to get through, make sure that we have like the chronological steps first. And we were on the step where we have, you say that you don't have a contractor walk it anymore.

And so the implied task. So if you don't have a contractor, find some and then learn the price points for your market. Yeah. And what you really want to know, the questions you should be asking, because they'll get you a different price depending on the way that you ask them. So you really want to know. Because they're interviewing you too. Yeah. And you want to ask, what's your price per square foot to install?

laminate. What's your price per square foot to install tile? What's your price for square foot to install paint? So then if they're saying like $2 to square foot to install, you know, laminet, which is expensive in this market, but the math is easy. So if it's a thousand, five hundred square foot house, that's $3,000. If you didn't ask them that beforehand, they might just have said $5,000. But because you said, what's your price per square foot to install laminate? Now they have to say $3,000. And if they say $5,000, then it's like, whoa, walk me back from this. Why is it 5,000? Well, you know, it's 2,000 installed baseboard. Really, 2000 installed the baseboard.

And then you can take them down to that. How much is your price per linear foot to install baseboard? And they should be saying like maybe a dollar linear foot. And it's like, okay, this is only 500 linear feet of baseboards. There should be 500. If you ask each thing individually, you'll end up getting a lower number rather than if you just ask them a blanket price. That's a really good point.

Are you hiring, do you hire like, G.C. Or are you like subbing out and managing, you know, being the project manager? I would sub out a GC. There was the GC who could do it for like 20% more than what I could do it and they could just run the whole thing. I think I haven't been looking for a GC ever since COVID started. You have or haven't? I haven't. Well, I have, but they're all like charging like 50% more, 70% more than what I would pay. Like if I would flip this house for $30,000, A lot of the GCs were charging like 45,000. And I just don't think that's worth it.

And anything is worth it for the right price. Like, I mean, I'll buy a Ferrari right now if you give it to me for like $80,000, right? Like I don't even flip cars, but I'm like, hell, I could buy it. I could sell for like $200,000 tomorrow. Why not, right? Yeah, send it. Like any deal, even though people will say like, hey, I only buy three twos in Fayetteville. If you got a 2-1 in Fayetteville, but they're like it's for $5,000.

Sold. Yeah, like just give it to me. Yeah. You know. So. Okay. So at this point, you don't have like a GC overseeing the projects. You are, you have your painter.

You have your flooring guy. With my team, like Marlin like checks up on all the properties too. Between us, we can check up on the, on the contractors, all the contractors have been with us for a really long time. And like the GCs are just subbing out all the contractors, which like, if you're a property manager, which I'm super catering what I'm saying towards realtors. Yeah. But like property managers are doing all this. for their clients anyways. It's like, oh, I need new, the old tenant kind of ruined it a little bit. We need new paint and flooring. You're already getting the paint and flooring person as a

property manager, right? They're like basically managing whole entire rehabs for getting paid like $100 a month to be a property manager. So as a flipper, the profit is so much more. And if rather than spending $45,000, you're spending $30,000, that's $15,000 worth of profit. So if you're a property manager listening, you are coordinating rehabs. You're doing everything that G.C. is doing, and you shouldn't be doing that, by the way, but you're doing everything that GC is doing for, like, pennies when you should be making a lot of money on it. This is my first, like, pause, because I think I got, or maybe, maybe it's not a pause. Now, I just fucked it up. Because, wait, you said property manager. Do you mean project manager? No, I'm, I'm, you mean property.

Like, actual property managers, the people, like, manage their property for, like, 8% or 10%. Yeah. When there's turnover and renovations have to be done, they're managing, that's what you're saying. Yeah, for all the realtors who are property, because I'm super catering this for realtors right now. Yeah, which I'm glad. That's a very good audience. So, like, you guys know property managers who are dealing with all this for like $100 a month from their, you know, rental income, right? Or like an 8% management fee. They're doing everything that a project manager does, right?

Yeah. Which is insane. Yeah, it is. I think property manager, project manager, I think rental managers, I'll just say that. Yeah. I think rental managers. do so much work, more work than anybody else in the real estate business. And they're doing the work of a project manager, except instead of getting paid like $10,000,

do it. They get paid $100 a month. Yeah. That's a man, property management. That's a whole other conversation too. Yeah. Okay, but to bring it back. So at this point, we have rough idea on how to find the deal, how to run numbers, how to

confirm pricing for contractors. So next is, how are you financing your deals? I use Kiavi and I think I get like a $500 referral fee if anybody, I think if they just use Jay Miranda. So if you do call Kiavi, say Jay Miranda refer to you and let's see if I actually get $500. Is that a hard money lender? Yeah, it's a hard money lender. But they're really good because they're institutional hard money. Meaning there's real hard money to where they're not checking your credit.

They're not checking your background. They're not checking your finances or anything. They're just giving it to you straight gangster style and you're probably going to pay really high points, maybe like, you know, 12% and 3 points up front. Maybe these days even like 14% with 3 points up front where for me, somebody who's done over 100 flips and I have a relationship with Kiavi, I'm not even supposed to say that. I don't have to put any percent down.

Like I have a personal carve out. If you ask Kyavie, what's the lowest amount I can put down? They're going to say 10%. Yeah. I have my own personal carve out for 0% down, which you just can't get unless you're, if there's somebody calling off the ship. streets. Fancy. But for anybody who's a little bit experienced, they're going to get 10% down with nowadays like 11 to 12% interest rate, you know, and like one to two points up front.

Okay, gotcha. Where. But that's for unexperienced people, inexperienced, un. Yeah. For inexperience, it's probably still going to be like 12% with maybe two points up front. Because I hear, you know, when people try to get financing, it's such a problem when, you know, if they're going to hard money, lender and they're like, what's your experience? And they're like, I have none. And they're like, we'll come back when you have some. And there's no college for this, so they're right. Like, there's no college for being a flipper. So the only way you know someone's a flipper is if they're a flipper.

Until they call Jay Miranda and they're like, I want to partner with you on this deal. No. You're like, that's my nightmare. Literally now. I want your money, not your opinion. Prop. Partner with me with like giving me money, but like we put in there, I have 100% say on everything. Everything that happens.

Yeah. It's not here. I'm not trying to have somebody else make it like a fun game. Oh my God. You know it would be so fun. Let's just paint the walls purple. We're not doing that. You don't be really fun blue cabinets.

We're not doing that. We're not. Yeah. We're painting it white and beige. Okay. I'm sorry. So that's your thing too. I'm sure with your contractors you have like you have already picked out your,

what's it called? Your style preferences. Yeah. And then they just know when they go in there, they just do the same thing every time. Right. It's basically the same thing every time. There's minor changes that happen per property.

but for the most part it's agreeable gray. We tried out white and different lighter colors. It doesn't work out. We're back to agreeable gray. And I would say that that's probably a consideration because, you know, the designers who are listening are like, but I want to do, you know, whatever specific thing I saw on Pinterest. And I think the decision point comes into whether or not you want to do it at scale as well.

Yeah. I think if you're doing a one-off flip, you might be, there's the Facebook flippers out there who really overdo the house and they make it look so cute and adorable. Yeah. I don't make my house. the best. If it's in like a house that's like 350,000, which is not a lot in Las Vegas. If it's a million dollar house, you need a super attention to detail. But if somebody's a Pinterest person, they're probably spending way too much that they want to really gamify it and like make it so it

looks good for Facebook. But little things, if you, if that's fun for you and you could do those little things, I wish I could do that. I can't make things super cute in a property. You made this plant look so good before we started. Thank you. Thank you. centered it? It looks amazing. Yes. Don't sell yourself short now. Thank you.

I wish I could do a little like floating shelves and little designs that make it look cute. With the financing, I can go back, though. So you have zero percent down. What is your interest? Where do they get you? For me, it's 11.5 percent with one point up front with a 999 transaction fee. Okay. So if you're putting 10 percent down, it might be like 11 percent.

If you're putting 20 percent down, you might get it to like 10, 10, 10 and a half. I think I'm putting too much numbers on Pee. and they're going to forget that. It's okay. Hopefully, maybe they're writing things down. Yeah. Or maybe they just blacked out.

Okay, but hypothetically, you're not Jay Miranda and you don't have this amazing financing. Sure, you can go to, what's it one more time? Kiavi. Kiavi. K-I-A-V-I, which Kiavi means key in Italian, but it's C-H is the Kiavi sound. So they whitewashed it by calling it Ki-A-V-. So Ki-Ovi's not even Ki-I-W-W. Yeah.

Okay. But in the beginning, hypothetically, you know, the real estate agents out there and they're like, this is my first flip. Would you recommend they use their own money cash? Or would you recommend, like, what would you? I don't know. I would say put 20% down and you'll get a lower interest rate and have money in reserves. So what's going to protect your downside the most is, and like that's number one. So like Warren Buffett says rule number one of investing, don't lose money.

Rule number two, see rule number one, right? like do not lose money on the property make sure that you're not going to be stuck with it make sure that you know just don't lose money and I think the more powerful way to protect yourself is has proper reserves because I see a lot of investors not factor in all their holding costs not factor in some things that happen that's not expected maybe they're broken into maybe it's an older house and some additional things have to happen that they didn't quite expect which is why if if you're flipping always, whatever you think the cost is going to be, it's more. You're going to find something.

And I'm super good at all the costs for like 1990s, 1980s flips. But if it's a house that's 1950, 1960, and the floor plan is a little weird, it's always more than I expect every time. And you have to factor that in. Okay, so you say 20% down and get like... 20% down and make sure you have reserves. I would rather, I feel... You're not talking about hard money, though.

You're talking about 20% down on like a conventional so you can get a little... rate or are you talking about hard money? On hard money because basically conventional will not qualify you for the loan because it won't pass appraisal. So you still get 20% down on like maybe a hard money loan because they will get you a better interest rate. But you just make sure that you, let's say a house in your area is 400,000 and you had 400,000 to find a flip and fix it up. I'd rather you buy, you know, a $300,000 house and put $60,000 down and have all that money in reserves. one so that you have the optionality of if you go out there and you go to everybody and you're like hey I'm looking to buy my first flip and tell everybody right like everybody who you come across tell every person in the world have no shame that you are looking for flips right and like let's just go backwards what's the number one way to guarantee that you never get a flip don't let anybody know yeah don't let anybody know that you want to buy a flip so conversely like what's the number one way to not sell a house as a realtor tell

knowing that you're a realtor. Okay. Don't let anyone know that you have your license. Don't let anyone know this is something you do. But number one way to start getting flips is tell everybody that you're looking for flips. You might buy this first one. And then a month later, two months later, when your realtor friends is like, hey, Shelby, I got the perfect deal for you.

It's this one over here. Fayetteville. It's this price. Like buy it now. You don't want to say you don't have any money because if it's a screaming hot deal, you got to buy it. So one. I want you to have optionality because I never want you to turn down a good deal.

but I want it so that you have all the reserves so that something happens, you can cover it. I think having more money in reserves is more important than putting down all cash. Okay. So they're putting 20% down. They're having money in reserves with your hard money, Kyavi. They are lending purchase and renown? Yeah. For me, it's purchase renovation.

Like I can find out for an average person. For this hypothetically, this first timer. Yeah. And then just so that everybody knows when they, finance your renovation. They do it after you do the renovation. Good point. And some people are like, I only have the 10% down of 300,000. So let's say 30,000. I only have 30,000. So I'm good to go buy this house now. But they don't know that you have to pay for all the rehab. Then you have somebody inspect what you did. And then you can get your renovation draw. So if it's like 60,000 rehab,

They don't just get you that money up front. So you can buy a Ferrari with it. And then flip it. Yeah. Okay, gotcha. That makes sense. I wish they did, though. So you have, you found the deal.

You have your numbers. You've financed it. And then what else? So at this point, you close, you start. Oh, and then by the way, so you go through Kyavi and all that because they don't, or you go through, there's institutional hard money. And then there's like private hard money. Private harm money is probably going to, or like one of your friends.

So one of your friends could just write a note and put it on the house. But trust me as someone who's done over 100 flips, everyone's an investor until it's time to pull the trigger. Your friend is going to say, hey, girl, I got 200,000 for you. Like, if you find a flip, Shelby, I love you. Like, I'll lend you that 200,000. And now you found the flip. And you're like, I got it. Give me the 200,000.

And they're like, oh, I don't know. I just don't feel comfortable right now. Like, are you sure? Are you sure with this? Are you sure with that? They're not going to lend you the money. Oh, I think you should be buying it for like $160,000. Who are you to say?

Right? I'm the real estate professional here. Give me the money. But this is why you go through institutional hard money lenders because they don't get trigger reluctance. You know, they don't have the anxiety about like lending you $200,000. That's an everyday occurrence from them. So the more emotions that you have to deal with, the more stressful everything is and it's not predictable. Go through someone like Kiavi.

because you're going to get the money for sure. All of this sounds like a lot of work. And I've flipped a lot. So obviously I'm like, I'm leading this, but go on. What you could do? Yeah. Not with Kiavi. I think there's company called Anchor Loans.

Okay. But there's something called Gap funding, which gap funding is like, okay, let's say you need 10% down on this property, 300,000. So that's 30,000. But you don't have 30,000 because you're broke. Your friend could do gap funding for like 30,000 for you. and Kiavi doesn't let you do that, but I think a company called the anchor loans does let you. But I've heard other people that have problems with them, but some people will let you do gap funding in case you don't have the money to put down.

Gotcha. This is a lot of work, though, right? Flipping us. Okay. So when you were real estate agent, Jay Miranda, which you still are, but you were doing more sales for other people. And then you started flipping at the same time, which I feel like is probably the position of. most real estate agents. What were your lessons learned? What does it really look like to try to work sales and flip at the same time? So I focus so much on flipping that I think it took away

from me being a realtor. I think that if I would have just focused 100% on being a realtor and maybe cherry picked my flips a little bit more. Like I think anybody who is a realtor who's busy in their market could find two flips a year just doing what they do. Just, you're showing people houses and talking about it and talking about it yeah and if you're talking about it and actually going to like realtor meetups and telling everybody that you're looking for flips you might even get more and like the flips that I've gotten from other realtors tend to be in nicer areas safer areas and maybe things that just need like a paint and flooring rehab rather than complete tear downs would you recommend that for if someone like their first flip what if they get like a

scream and good deal but it's a ton of work or they get like a base hit with less work. What do you recommend? I absolutely want them for your first few flips. Have it be something that's a little bit easier. Like, you know, wean yourself into this a little bit. Like, hey, I'm going to do this flip. It needs paint flooring. Maybe paint the cabinets or something like that. Maybe tile one bathroom, but nothing more than that. And then put it on market so that you get a little bit of pacing for the flow of it. So you can see if this is something you like. And if it's one of those, you haven't even gotten to the stressful parts yet. I've had flips where I had to pull guns on people. I get broken into multiple times. I get broken into over 30 times a year because I take

on flips. It's nuts. Yeah. I take on flips that are a little bit more dangerous, you know, and it takes up all your time and mental attention. Get the ones that are, you'll never get broken into a condo. Maybe you will, but probably not, you know. Just get one in one of these nicer communities, do that and then increase your skill set a little bit. My first flip, it actually was a difficult one but you know we we dealt with it i didn't do a full remodel like i would need these days on it but second third fourth they're more like paint flooring maybe change they lay out a little bit and then just do a new cabinets and a traditional rehab and those are easy they're more predictable and then as you start to increase your difficulty thank god like the the worst house that we did

marlin i think was 2021 in the middle of covid probably on oh nida right that was one to where like drilling into concrete putting into water lines doing other stuff it was a lot if that was my first flip I don't know what I would have done you mentioned developing the skill set what do you think is the are the most important skill sets that someone would need to develop to be a good flipper um even though you don't know construction like I don't I've never done construction like I don't but I know the process of it if you what's skill set? So like knowing what the process is of rehabbing a house like you know you do paint and flooring and just seeing it happen and watching it happen does a lot for you. You know,

you just seen it done from beginning to end, right? And there's things that you're going to pick up along the way. And there's the skill set of negotiating with contractors, skill set of talking to contractors. And just like when you're a realtor, when you do a lot of deals, it conveys in your voice, if you don't say it. Like, they know when you've never sold a house. They know whether you sell, you know, two houses a month because it shows up in your voice. When you talk to contractors and you've never rehab a house before, I can't even think of what it was like to do that. But it will show your rookiness will show.

And at this point, when I talk to contractors, they just, they don't even make me put money down up front. I'm not putting up half the job. They, like, do the work first and then I pay later. They know that I know my shit, right? I talk about the other houses I do. I talked about how I did this one. I talked about the other one on the other street. I'll show them a picture.

And they know that they're talking to someone who's real and they're not going to try to boost the numbers up on you. I laugh because it's so true. It's like they can, clients can like smell it. They can hear it. They can sense it. And same with contractors. And then the minute they're like, oh, I got myself a newbie.

Like, bring it. You know what I mean? Yeah. And it's hard. I'm 34 now, but my first flip, I was 27 or 26. And I have a baby face. So I looked like I was like 19. And my contractors are like 42 years old.

And they just don't want to listen to you, right? Unless you have a resume and a history and you've done it before. Is there any way to shortcut this? You could work with a flipper. Even when you work with a flipper, you're probably only seeing certain moments. You're not handling the back-end phone calls. So you're not handling the real parts. You might think it just magically got done from beginning to end.

but I think that for I rehabbed some of my own personal properties before I put it on market. Like in 2017, I sold the first house that I did in 2011 and I painted that house. I redid the carpet and I did some LVP. And every rehab that you do that you subcontract, you're going to increase your skill set more and more and you're going to know the process more and more. But I think that being a realtor is a great help knowing what sells. I've done a lot of sales. to where other flippers would have done like a full huge rehab on it. And I'm taking a look at the comps.

And like, hey, it'll sell for what you think the ARV is, which is paint and flooring. So why would I do everything else? So that Facebook thinks I'm cooler or I put out whatever, like you don't have to. When you're a realtor, you should know what sells in that neighborhood. And like when I see the flips that David Paray does out in Missouri or something like that, like we would never use those finishes. Right. That's like you know what your market.

wants a little bit more. Hope Dave listens to this. Yeah. Calling you out. Yeah. Okay, gotcha. So let me think about where I want to take this. Really, is there anything that we didn't talk about that you think that someone, a realtor who is interested in flipping should know?

Yeah. And yeah, that's the one thing I said. If you focus too much on flipping, you're going to take away from your realtor career. And then being a flipper, if you do the ones that are two in the weeds, don't do anything that's too old, nothing that needs too much work, because that's when there's a lot of things that are unexpected that come up that will destroy your profit and that will ruin you. Take the ones, you're going to find deals as a realtor that will come up organically,

especially if you're looking for it, that will be screaming deals that are kind of easy. And I think I want to kind of nail this home with like, Warren Buffett, his whole entire business model is basically flipping. He takes businesses that are underpriced assets, and he fixes them up and he runs them and then he sells them down the road or he holds them forever.

But when Warren Buffett is looking at businesses, he's a really smart guy, really brilliant, and I'll take a look at something that's still a really good deal and I'll say it's too difficult, too complicated. But he's going to put in really smart people in place anyways. He's going to put in the smartest people and when you're a flipper looking at a house and you'll still make money on it.

You want it so the numbers. Don't try to play with the numbers or fudge the numbers. just get it for lower. Realters have such a guilty conscience about getting anything under value. If that person's selling their house for like $330,000, offer $200.

See what happens. Offer 180. Get it for lower to where even if you screwed up everything, you would still make money. And that's the deal that you should buy, right? Don't try to make the numbers work too perfectly. If you think that the numbers on a $400,000 house will work for like 360 or $370, $3.3.80,

try to get it for $3.30. And now you have more insulation so that nothing will go wrong. Yeah. There's some saying about like you win or fail on the buy. Yeah. In all of these. You're flipping businesses, you're flipping houses,

it all starts with the buy. And then the other thing that Alex Hermozzi says, but about what you said, it's like simple scales, fancy fails. So just sticking to that. And I have that like on repeat in my head. So yeah.

That's catchy. Wait. Simple sales. Scales. Simple scales. Simple scales. Fancy fails. Fancy fails.

sales, right? It's catchy. And then if you just say it a lot, you're like saying it all the times. Okay, before we had to wrap up, I want to talk a little bit about like what you're doing these days because we talked a lot about, you know, what real estate agents can do if they're interested in getting into flipping. If interest rates went to 5%, then we could just do 40. And then we just like felt the wins go to that. But inflation is just so much stickier than what we thought. and they don't want to, you know, they don't want to reduce interest rates too quickly because it was like in the 80s or 90s or whatever to are like, hey, they saw inflation go down.

So then they lowered interest rates and then it went back up again. And they saw them always playing this game trying to catch up and everybody going up and down. They're like, we're not going to do that this time. We're going to take our time and we're going to make it so that when we lower interest rates, we never go back up. So you're not going to see them drop it too quickly like they did in. decades past. So, I mean, hopefully we get to 5%.

Yeah. So really it's just rates. It's like not deal flow. It's not your team. It's not your capacity. It's like, I'm getting involved in. I mean, if a deal is really good to where I can't say no, I'll never say no.

Even if I have to. Yeah. Even if I have to rob, borrow whatever for the money, like I'll get the money to just buy it. And there's one thing that I'm trying out. So like as a realtor, there's certain things that if you got in at the right time, things were just really underpriced. And you found it out before.

anybody else. In Zillow, it used to be really good. And then right now it's a Zillow lead, really expensive, right? I mean, you need to pay thousands of dollars to have any success with Zillow at all, and you're still overpaying. Facebook leads back in 2017, super cheap. I know Flippers who in 2018, 2019 figured out text message marketing, and they're the first ones to do text message marketing. Nowadays, everybody does it. So because they're the first wants to do text message marketing they made millions of dollars on it because nobody else figured it out there's one thing that's going on right now which is the AI software for cold calling and I'm going to spend a couple thousand on it I'm going to try it out if that blows up and I'm getting like

five deals a month then I guess I'm getting five deals a month right like if that works as good as text message then I guess I'm just going to make millions this year until everybody else finds out and then nobody else is going to catch up to it till like three days later no everyone who's this podcast is going to go do it right now. They're blowing your idea out of the water and you're screwed. They're not going to do it until like somebody else says, oh, now they had success. And I know some people are having success with it. They're picking up a few deals.

So I don't know. That's what's coming. Yeah. Okay. If I got multiple houses that could sell for $400,000, I could pick it up for $250, then I buy 100 houses this year. It's just being able to find that. Perfect.

And guys, if you want to hang out with me and the owner of this show, We are The Shelby Show and Erin Amitius Staggy on the gram. So check us out. And please hit us with feedback. We want to know, do you love Jay? Do you hate Jay? You never want him back again. Are there like specific topics or people that you want us to interview because we're always

looking for feedback and will immediately implement it? So Jay, thanks for letting me in your house. Thank you. Thanks for coming. Thanks. And real estate rock stars. Thanks for listening.