The Science of Flipping - Mindset, Diversification, and Taking Action | Damon Hart

Episode Date: June 28, 2023

Mr. Damon Hart, shares his experience in the real estate industry. He mentions that his business had a successful year in 2022, with a 25% increase in revenue. However, towards the end of the year, they faced some difficulties due to slow market conditions and changes in buyer behavior.We also discuss the importance of mindset and mental preparedness in real estate investing, the need to take massive action and be comfortable with being uncomfortable, and the significance of aligning oneself with mentors or coaches to learn from their proven experience.The #1 training and coaching system to launch, grow, and scale your investing business! 𝐋𝐞𝐚𝐫𝐧 𝐌𝐨𝐫𝐞: http://www.thescienceofflipping.com Sign up for Minute:Pages using code 𝐓𝐒𝐎𝐅 for a 𝟏𝟓% discount for life!https://minutepages.com/sign-up/ Become a 𝐓𝐒𝐎𝐅 𝐈𝐍𝐒𝐈𝐃𝐄𝐑 and get access to exclusive training and resources: https://insider.thescienceofflipping.com 𝐈𝐍𝐒𝐈𝐃𝐄𝐑𝐒 𝐆𝐄𝐓 𝐅𝐑𝐄𝐄 𝐀𝐂𝐂𝐄𝐒𝐒 𝐓𝐎: Science of Flipping Academy   All the systems and software I use in my business All the tools you need to run your business  All my Scripts, Contracts, Spreadsheets Special Discounts And Much More... 𝐇𝐚𝐯𝐞 𝐚 𝐪𝐮𝐞𝐬𝐭𝐢𝐨𝐧? Email us at [e-mail] 𝐁𝐞𝐬𝐭 𝐑𝐞𝐬𝐨𝐮𝐫𝐜𝐞𝐬 𝐅𝐨𝐫 𝐖𝐡𝐨𝐥𝐞𝐬𝐚𝐥𝐞𝐫𝐬 𝐁𝐞𝐬𝐭 𝐀𝐥𝐥-𝐈𝐧-𝐎𝐧𝐞 𝐑𝐄 𝐒𝐨𝐟𝐭𝐰𝐚𝐫𝐞: https://reileadmachine.net𝐁𝐞𝐬𝐭 𝐌𝐋𝐒 𝐒𝐨𝐟𝐭𝐰𝐚𝐫𝐞: http://privytsof.com/ 𝐁𝐞𝐬𝐭 𝐑𝐄𝐈 𝐖𝐞𝐛𝐬𝐢𝐭𝐞 𝐁𝐮𝐢𝐥𝐝𝐞𝐫:   https://tsofpages.com/ 𝐁𝐞𝐬𝐭 𝐒𝐤𝐢𝐩 𝐓𝐫𝐚𝐜𝐢𝐧𝐠 𝐒𝐞𝐫𝐯𝐢𝐜𝐞: https://tsofbatch.com/ 𝐁𝐞𝐬𝐭 𝐓𝐞𝐱𝐭 𝐁𝐥𝐚𝐬𝐭𝐢𝐧𝐠: https://tsoflaunch.com/ 𝐁𝐞𝐬𝐭 𝐃𝐚𝐭𝐚 𝐏𝐫𝐨𝐯𝐢𝐝𝐞𝐫: https://tsofdata.com/ 𝑾𝒉𝒂𝒕 𝒕𝒉𝒆 𝑷𝒓𝒐𝒔 𝑯𝒂𝒗𝒆 𝑻𝒐 𝑺𝒂𝒚 𝑨𝒃𝒐𝒖𝒕 𝑱𝒖𝒔𝒕𝒊𝒏: “Justin is one of the best trainers in this space. He really gives everything to his tribe.” – Brent Daniels (TTP) “Justin’s ability to connect with people and help them understand what he is teaching, is unparallelled” – Kent Clothier (REWW) “We have been in the trenches flipping homes in Phoenix for over a decade, he is one of the best to do it.” – Sean Terry (Flip2Freedom) 𝐀𝐛𝐨𝐮𝐭 𝐉𝐮𝐬𝐭𝐢𝐧: Justin Colby is the founder of The Science of Flipping Podcast and The Science of Flipping Coaching Program and is an active Real Estate investor having flipped over 1500 homes in multiple markets across the U.S. Justin runs an 8-figure real estate wholesaling business that closes 20+ deals each month in multiple markets across the U.S and has helped 1000s of clients learn how to become successful real estate investors. Justin subscribes to the philosophy of "Wholesaling To Wealth" and is the foundation of his coaching program which teaches you how to get started wholesaling or streamline and scale an existing wholesaling business as well as build long term wealth through wholesaling, flipping, and building a rental portfolio. Subscribe To Justin Colby: http://youtube.com/justincolby View All My Videos: https://www.youtube.com/c/JustinColby

Yo, yo, what up everybody? Welcome back to the Science of Flipping podcast. I am your host, Justin Colby. I have a very special guest here today talking to you about his business and what is working and not working and how you guys need to be pivoting. So make sure you stay for this entire episode.

But before we get to him, as always, our top sponsor, MinutePages.com is there for you if you are a real estate investor or a realtor looking for a prominent website that is professional, that is specific to what you do, you need to make sure you're checking out minutepages.com for a prebuilt website for $97 a month, minutepages.com. With that being said, Mr. Damon Hart is with us. What's up, brother? What's up, man? How are you?

Good, good. Well, I'm excited to have you on here. Damon and I met through what I argue to be the very best mastermind on the planet for real estate investors who are active, who are doing deals, who are making money, and they just need to continue to level up their network and grow is the boardroom. And so the boardroom mastermind is the one that I just came from. He just came from. We were having some cocktails. At least I was having some cocktails.

And he says, dude, you need to get me on your podcast. I'll drop some knowledge. So I obliged. He's an awesome dude, someone that everyone here can learn from. And so let's kind of jump into it, dude. What, how did your 2022 year go and how did it end? Yeah. So, you know, the year overall, I mean, we were up the whole year at the end. We probably increased revenue like 25% at the year end. So that was, I mean, from 2021. So you increased revenue. 20%. Yeah, over 2021. But Q4, I mean, started out kind of slow and then towards Q2, it started really picking up. And then Q4 was just a halt. I think we got into October and all of a

sudden, it feels like people just, especially buyers, because most of what we were doing was wholesale. Nobody was picking up the phone. You know, it was just really slow at that point. So I had to make a couple of changes, but you know, I think now things are kind of picking up a bit more, but we're not waiting. Let's talk about the changes you made. What changes did you make?

What pivots, adaptations did you move in that Q4? Dude, man, it was really simple, simple man we went I I kind of give you a story uh it was around my wife's birthday and we were we were had two closings set up to close with one of our cash buyers big a big large kind of fund you know I had to fund whatever we're selling a few properties to them and you know we were going to close it was a wednesday we have one closing on friday one closing on monday wouldn't you know it we get to the closing table this the head front says we're not closed we're not buying those any we're not buying anymore and then the same thing because we knew we had one coming on monday and they were like hey i'm out now for me

i wasn't surprised because i had heard a couple of things, but it was crazy to me because back in the day I was in the mortgage business in like 2008. And I remember one day I walked in, I was working for a company. I walked in one day, they said, Hey, everybody go to lunch. We all went back to lunch. We came back, all the doors were locked and we were, we were all out of a job. So this kind of felt like that on a smaller scale and i was just like you know something's changing so right after that things just started falling in line a lot of cash buyers were just like nope not buying so we decided man you know

instead of chasing these cash buyers uh to the degree that we used to we got to just figure out first okay how to get these properties out to who's looking. And we started switching up and just going more to like, you know, get stuff on the MLS, innovations, and really trying to dig out, you know, those other buyers that are still in the market. That's what we did. So you went from more of a traditional wholesale manner, which would be wholesaling to a fix and flip or a fund right to a novation creative finance model and i call it creative financing because you're creatively exiting the deal which means the front end acquisition is a little bit more creative i

love novations i've been doing them for years um and so you pivoted into a novation model and that actually helped did it increase volume or did it increase profit margin or maybe even both yeah so you know in the short term because I mean we really pivoted hard and that's to use that word right but like overuse it but we made the change around like November so you know with this process it's a little lead time right when you start changing stuff you're gonna have like 30 45 days until you actually start seeing it so we're just starting to see kind of like how things turned out and yeah we're making more money than we were the other way you know uh you know assignments we're anywhere between 10 and 12 uh 20 on because we do we're in florida and we probably saw about like a

you know like a 25 50 increase so far um but what the thing is i feel like the most notable is we're having more conversations switching to like more of a novation or creative finance because now people are at least willing to talk right when you just go in like and you just have one option and just say okay look you know this is our cash offer it's kind of like you know you you're going into i don't know you're going into you know you're going into the store looking for one thing and if they don't have that one thing you're out like if you go in there and you're making you know some kind of like i don't know this is the best analogy but if you got something else you got a couple of different options people are more inclined to listen to you i feel like because and we're seeing it like we're having

way more conversations we're getting into c properties we're having conversations with with uh people that we wouldn't happen be have before because we got more options for so i think that's the biggest thing that you know the kind of like market difficulty it kind of opened up for us yeah anytime you can open up options and diversify. And so many of my audience know that I believe in being a dynamic real estate investor. I don't agree with being a one-trick pony. Don't just be a wholesaler. That's what everyone is. Everyone gets into the game because you don't need cash and you don't need credit to be a wholesaler.

Well, you don't need cash and you don't need credit to be a flipper. You don't need cash and you don't need credit to buy and hold. You don't need cash or you don't need credit for any of it. People just don't need credit to buy and hold. You don't need cash. You don't need credit for any of it. People just don't know that. They're limited to their own belief because us gurus have taught everyone wholesaling is the easiest way. Not necessarily that it's wrong, but you can do all of it with no cash, no credit. And so when you diversify your exit, meaning whether you are wholesaling to a fund versus novating, it allows you to diversify your acquisition, right? And when you can do that, you're going to have a lot more conversations

and make a lot more offers. And what you've likely experienced is an increase in your income, increase in your gross rev, right? And so people need to understand that, right? And if you are out there listening to this and you are that one trick pony, or maybe you're just trying to get break in to the space of real estate investing. I love wholesaling. I still wholesale, but I also buy and hold and I also flip and I don't ever use my own cash and I don't use my own credit. I don't need to. And so I just want people to be aware of that. So following a certain process and a strategy and a plan on how to do that is very important.

I wouldn't tell people to just go out there and arbitrarily try to do it, but you can absolutely burr homes. You can buy rentals. You can do sub twos. You can wrap. You can do all these things. Again, no money, no credit necessary.

So with that being said, how many deals did you finish 2022 with? Yeah, we did. We did about 33 deals. Okay. Yeah. And what's your goal for 2023? Yeah, we're good. We're looking to 5x that, you know, to let's go 50 this year, for sure. The things that we put in place so far is really just ramping up our marketing. But, you know, it's, dude, you know, I've been doing this a while. And, you know, the thing that I take away from like being part of Mastermind and like Boardroom and that sort of stuff is that if you don't look to, there's no shortage of

opportunity out there. They're really, you know, but the thing which you got to kind of align yourself with is like, okay, well, where do you want to go? And then kind of figure out like, okay, what's the step I can take now? And then start building from there. And I think we kind of overcomplicate this thing because I talked to a lot of people

that kind of want to break in. They're like, where do I start? What do I do? I said, dude, just know where you want to go and then start somewhere. Cause that's, that's kind of the, the, the, the secret sauce. Like you, you're not going to know everything off the bat. It's impossible. Nobody knows everything about everything, but if you get started, right. You just get started and start somewhere. You'll figure it out. You'll figure out how to get there. And I think that's the main point that I think a lot of people miss when they're

trying to get in because nobody wants to make a mistake. And it's impossible. You're going to mess up. You're going to make sure that it's just going to go wrong. It's just the way it works. Sure. No, your advice is totally correct. I mean, the way i would say it a couple different ways if you want what someone else has pay that someone else to teach you that period right that's you know everyone gets very short-armed when it's like oh i want to go make a million dollars a year but i won't invest ten thousand dollars into justin or damon coaching me on how to do that although they're doing it i won't pay them that because I'm short-sighted. So first of all, if you want what someone else has and it's proven, pay them to

teach you, period, end of story. But the other part of what Damon's saying is my five core belief systems in success, right? You have to decide what you want, like Damon is talking about. Decide, right? You want to break into real estate investing? Decide you want to do that. Then commit to it. Be fully committed to breaking into real estate investing. Take massive, massive action, right? You are going to fuck up a lot of shit. You're going to eat shit sandwiches. Who cares? Keep going. That's how you learn. Get extremely uncomfortable. Be prepared and be okay with being extremely uncomfortable. You have never done this.

It is going to be outside of your comfort zone. Get it? It's that simple. It's just an equation. If you've never done it, it's going to make you uncomfortable. Okay? And then lastly, remove your time expectation. People talk about proper or improper expectations.

I put one simple layer on top of that. Time. Everyone wants their first deal in the first 30 days. Every 30 days. 100%. Yeah. It is doable. It is absolutely 100% doable, but it is not guaranteed.

I have students constantly get their first deal in the first 30 days, but I have students constantly get their first deal in the first 30 days, but I have more students get their first deal in the first six months than in the first 30 days. And if I could tell anyone listening to this, if I could guarantee you, if you take the appropriate amount of action that you will get your first deal period, would you ever think twice about it? And everyone's going to say, no, I'd never think twice about it and everyone's gonna say no i'd never think twice about it well you didn't hear me say when you're getting your first deal i didn't say in six months i didn't say a year i said i guarantee you if you take these actions you will get your first deal yeah leave it at that don't do this 30-day thing don't do this

in the first three like, like just go get it. And if you do those five principles, you're going to win period end of story, right? Full stop on that. And that's what Damon's talking about is I want to do this. I want this, or I want to break into this. You're just not committed enough. You're not willing to be outside your comfort zone. And the challenge that I get as an educator is if you're not willing to be outside your comfort zone and the challenge that i get as an educator is if you're not willing to be outside which you're going to be then when you're supposed to take the action but you're outside the comfort zone so this is new action for you to take yeah you won't take it right and that's where this whole fundamental

thing breaks down so here's the thing you know i thought about this a lot too man because i've been kind of like uh as i'm as i'm more out and talking with people i hear this a lot and i had to think back to when i was kind of getting started um i personally wasn't like i didn't know anyone that was in real estate i think i was the first person in my immediate family to even buy a house. You know, I bought it like 100% financing. And I remember when I got going and I bought my house, everybody was kind of proud of me and whatever, whatever. And then shortly thereafter, me being the guy that I am, I was just like, I'm just going to go for it. I quit my job. I was having, I had like a six figure job. I left and I was like, I'm going to be a real estate investor. And then when I, when I left, I started doing, you know, investing and

I did one wholesale deal. And after that, I didn't do anything for like maybe like another six months. I didn't do, I didn't make any money. And the one deal I did do was because my buddy found me a house, you know what I mean? And I remember, you remember you know at that time my tenant downstairs stopped paying the rent you know i fell behind and eventually i went into foreclosure i think you know some of my story whatever yeah the point i i look back on that just and the thing that i think about the most buddy is i don't think it was i didn't have it here and i think that's the center of like kind of like why a lot of people struggle because let's keep it real.

Like no matter what you, whatever you decide, if you don't believe it, it ain't gonna happen. So I would think for it, I would say to anybody out there that's like listening, the one thing you gotta do is for sure, like get your mind right. Like there was a song, you seem like a hip-hop head right you

remember like i am did you just see my post this morning by the way nah what'd you post i posted is little wayne's carter for a top 10 album of all time because i was rocking that album this morning at the gym and literally for the better part of an hour every single song that came on yeah i was like oh my god is this album either i didn't realize how highly rated it was or i underrated it and it is fire so yes i am a hip-hop head yes yeah so like for we're talking about wayne right i slept on wayne for a long time too because i think it was like a generation a kind of like a half a generation because he was young when we were kind of like he was super young right you're already mid-20s late 20s by the time he was coming out at 16 years old or whatever yeah so we missed we missed all of that but yeah I mean numbers wise I think he's done better or like

more had more hits than Jay-Z if you think think about it, like he's had some serious, he's had like some serious blockbuster hits. The only thing is Jay-Z also called a little bit of the Kanye wave too. You know, when Kanye was hot, Jay-Z also kind of did a rebirth. And then Wayne, he did, but it was more with, you know, like Drake and like,

he wasn't really in the limelight. It was more Drake and Nicki Minaj and they went on a wave too. i think that's kind of why he kind of gets overlooked a little bit because he wasn't really in the limelight for another round he just had his round and and dude started when he was mad young too so yeah i'm sure but um i don't know now we start to talk about it right okay so speaking jay-z right mine right money right it was a song with him and memphis bleak back in the day um i think it was one of the i think it was memphis bleak's album and the thing that i remember is like you know

he's like my right money right ready for war he didn't say he didn't say money right mine right you know saying he didn't say uh get your course right money right you know it was about your mind and i think that's the one thing that people don't really they underestimate getting into business it is 99.9 percent of all of it this thing is 99.9 percent it is the people who are mentally not equipped and or not willing to equip themselves. Yeah. Yeah. And so you don't, but they don't even get in the game. They won't even get in the game because they're unwilling to even equip themselves for said war in the analogy. Right. Like they're unwilling.

Like it's incredible. I'm a little, you know, I'm David Hart. Right. So I'm a little bit forgiving because I know how it feels. Like I know how it feels to be kind of like, you know, unsure. I know how it feels to be like, hey, I, you know, I got my, I would get myself to the point where I would at least go for it. But I get it. If you got stuff to lose, like if you have a really great job, it might be a little bit

on like nerve wracking to consider like, oh, why would great job it might be a little bit on on like nerve-wracking to consider like oh why would I do this everything's good I'm comfortable but what I would tell people is like yo it's it's not the end all like even if you're not in that place where you're like I'm ready to take a risk I think you can I think anybody can do that you just need the right tools and I think um what I've learned over the years is that you can you can develop that skill man like you can develop the skill to be willing to take a risk is it going to be comfortable like you said probably not but just know that you can do that if you just uh invest the time up here that's what i that's what i've learned even part out

and it's for everything and listen I know this is about real estate investing and the science of flipping podcasts, but the reality is these lessons that we're echoing to you guys are quite literally life lessons. They're not just about flipping homes or wholesaling. It's just life, right? If you're at a place that you don't wanna be,

then you're gonna be doing things that you haven't done or aren't doing to get to a place that you want to be, right're going to be doing things that you haven't done or aren't doing to get to a place that you want to be right and so you need to equip like i said 99.9 percent of this success life is up here right read david goggins two books right can't hurt me and never finish like this man is a full-blown savage like the most savage savage like king savage right but he's rough around the edges and how he communicates it but it's all the same message that we're echoing to you guys right now right is you mentally need to break john gordon who just

spoke at the master talking about the mental talk how you talk to yourself is what you're going to create so john gordon and i've just adopted this uh it does these um walks of gratitude i'm a very positive person like extremely but it doesn't hurt to take 15 minutes a day to walk around my neighborhood or not walk around the office block and just be thankful for all the things that i have, right? And you said it earlier, I'm just gonna echo it. If you're unwilling to educate yourself and unwilling to stand on the books of what other people have written to give you a way out, then just don't bitch about it, right?

Like leaders are leaders because they're standing on the books of other people's workings. Right? That's why they are leading. And so I encourage all of you, if you're here listening to the science of flipping, and many of you guys are watching this on YouTube, go to justincolby.tv. Make sure to follow Damon here. Damon, where do they find you? Yeah, you can find me on Instagram at Damon Hart, Mr. Foxy. That's where I'm on Instagram.

And on Facebook, I'm at Damon Hart FL for Florida. There you go. And the reality is, if you're listening to this, if you're watching this on YouTube, if you're catching a snip of it on Instagram or Facebook or a reel or whatever, the reality is you need to be willing to want more. And some of you guys aren't going to be that person. And that's okay by me. I still love you. Damon loves you. Everyone loves you. But then don't want more. Be totally happy, satisfied, loving, you know, joyous in the place that you're at. But if you're like Damon, you're like me, you do want more.

Then you're obligated to go get it. You're obligated to do this, right? Because otherwise, the time you have on this planet which is short was for not right because you had this desire to have more and we don't always mean have in terms of material i mean literally have more have an abundant life have time with your family have the vacations you want and the material shit by the way i'll go'll go on and change it on that. Buy nice shit. That's why we make money. For any of you say it out there, oh, Justin, money's not everything.

Bullshit. Why do you have a nine to five job? Right. So you can make money. So you can pay your bills. It is everything. Quite literally everything. So I say that to say you need to follow Damon, but you also need to take a look in the mirror for all of you guys out there.

Real estate is what's going to make me a billionaire. And if Damon's in line with that, it's going to make him in a billionaire. But at least it's going to make him a fucking deca, deca, deca millionaire, right? I encourage all of you to be in real estate. And I encourage you to keep listening to this podcast. I encourage you connecting to people like Damon,

the people that I feature on this podcast. I encourage you to engage, right? Go to YouTube, justincolby.tv, subscribe, give us feedback on these episodes. But this is your life, not ours, right? So I encourage all my listeners, make the time you have on this planet matter, right? And in my world and in damon's world that's real estate it's going to create the life that we deserve right and you deserve the same life just might be in a different vehicle that's cool too any last words brother yeah man i want to just say thanks to everybody uh that tuned in it's really fun to get on here and um yeah if you guys um if you guys want to just get more about like mental like i talked about if you want some mental tips and just kind of like some uh six hacks that i use

every single day just to get ready up top mentally um you can find that at uh damon i'm sorry you can go out to foxyhomebuyer.com forward slash damon d-a-m-O-N. And what I'll do is I'll get you some of those tips and you can schedule a time even to talk to me and get my phone number there as well if you want. Love it. Love it, bro. Dude, you're a rock star. It's been so great to actually connect with you. I know we've been chatting via Slack for some time, but to be able to hang out, meet your son, who's so awesome that you brought your son to that mastermind, bro. I love that. I love seeing young people win. Cause I was a knucklehead, uh, you know? Uh, so I love that you brought them in anyways. It's been a blessing. I can't wait to see our next 10 years together. Uh, just rocking it in the real estate space.

So appreciate you coming on, bro. Um, for all you listeners, again, go, uh, to justincolby.tv or even go to the Justin Colby on Instagram. I'll see you guys there. Peace.