The Science of Flipping - The ADU Playbook: Build Wealth With Accessory Dwelling Units | Kevin Trinh

Episode Date: October 17, 2025

Want to learn how to build wealth with ADUs? Join Kevin Trinh’s ADU Mastermind in San Diego — where investors learn how to find, build, and scale cash‑flowing ADU projects. DM “ADU Mastermind�...�� to @thekevintrinh   In this episode, I sat down with ADU expert Kevin Trinh, who’s built over 180 accessory dwelling units and is quietly dominating a niche that more real estate investors need to pay attention to. Kevin broke down exactly how to spot ADU potential, what cities allow this strategy, how to structure the financing, and the long-term wealth-building plays that can make you millions. From converting garages to building multi-unit plays on a single-family lot, this episode is full of tactical advice and golden nuggets you won’t hear anywhere else. If you're serious about cash flow, legacy, or just stacking equity—this one’s for you. About Kevin Trinh Kevin Trinh is a licensed general contractor, real estate investor, and founder of the ADU Mastermind based in San Diego, CA. With over 180 ADUs built since 2016, Kevin brings a unique blend of hands-on construction experience and strategic investing knowledge. His work has helped dozens of investors create massive cash flow, spike equity, and scale real estate portfolios using the power of Accessory Dwelling Units. Connect with Kevin Instagram: https://instagram.com/thekevintrinh Facebook: https://facebook.com/thekevintrinh ADU Mastermind (San Diego): DM “ADU Mastermind” on Instagram to join or learn more About Justin: After investing in real estate for over 18 years and almost 3000 deals done, Justin has created a business that generates 7 figures in active income through wholesaling and fix and flipping as well as accumulating millions of dollars of rental properties including 5 apartment buildings, 50+ single family homes, and 1 storage facility Justins longevity in real estate is due to his ability to look around the corners, adapt to changing markets, perfecting Raising private capital, and focusing on lead generation which allows him to not just wholesale and fix & flip, but also accumulate wealth through long term holds. His success in real estate led him to start The Entrepreneur DNA podcast and The Science Of Flipping podcast and education company, and REI LIVE where he’s actively doing deals with members. He has coached and mentored thousands of aspiring and active investors over the last decade. Connect with Justin: Instagram: @thejustincolby YouTube: Justin Colby TikTok: @justincolbytsof LinkedIn: Justin Colby Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Transcript
Discussion (0)
Starting point is 00:00:00 What is up, the science flipping podcast family? I'm super excited about this. There's a lot of different verticals in real estate. And you can pick and choose your lane. And this is a lane I've been well aware of. I myself don't do it. But I do believe more people need to be doing 80U's efficiencies. Call it what you will.
Starting point is 00:00:17 My boy, the expert in ADUs. Kevin Trin is here. What's up, dude? What's up, brother? Thanks for having me here, dude. This was a long fight to make sure that this worked out. But I'm glad you made it to Miami. And couldn't be happier.
Starting point is 00:00:29 So let's dive in. Yep. First of all, I want everyone to know where to find you all over social media. So give the handles on where they find you. Yeah, on Instagram, the Kevin Tren, Facebook, the Kevin Tren. We also have the ADU mastermind in San Diego. So if you guys are looking forward to learning more about the ADU games, then reach out to me. All right.
Starting point is 00:00:47 Yeah. So let's talk about ADU. Some people maybe not even heard of it, right? They fix and flip or they buy rentals. So they may not be that familiar with ADUs. What are ADUs? What are efficiencies? Like, what is this?
Starting point is 00:00:58 You're right. right, man. There's a lot of real estate play out there. You already know, brother. But ADU is one of the new trends, right? It's the revolution right now in the real estate investing market. So ADU basically allows you to put a Casita or a small unit in the back of a property, right, existing property. So you're allowed to buy a single family and then get permits and add on an ADU, which is anywhere between the size of 800 to 1,000 square feet in the backyard. This allows you to really spike the equity and create massive cash flow, right? So out of the gate, a couple questions. Do you need to have a certain size lot? So I'm sure there's certain rules. So I want to get into kind of the rules of the game. Because I think some people watching it was like,
Starting point is 00:01:41 oh, I just want to do an ADU and then they're not aware. How big is a lot have to be? Like, what's the minimum lot size? So the minimum lot size at least needs to be about 5 to 6,000 square feet. Okay. And the reason being is that there is a floor area ratio that you need to understand, right? Most of the time is 0.5. And San Diego, you can get up to 0.65, so a little bit more.
Starting point is 00:01:58 You can use up more space. That allows you to build more units, essentially. So you could put an ADU on. So when you say 6,000 square foot lot, that means there's already a house and you build an ADU. Is that right? You know, 6,000 square foot. Yeah, most of these houses are only 1,000 square foot that we are looking at, right?
Starting point is 00:02:18 So, you know, understanding the buy box criteria will really give you the ability to build and, you know, add these ADUs in the bag. You know, so being from California, like senior, Yeah, you go, Southern California, this is very, very common. Northern California, maybe not as much. Yeah. But you're right. When I think about, like, L.A., so I went to UCLA, I think about all the homes that are, the main home before someone like yourself would
Starting point is 00:02:41 maybe put in an ADU, main home is only like a thousand square feet. Yeah, brother. Typically. Right? And so you still have this 5,000 square feet or more that you can do. Now, does the ADU need to have any level of a driveway or does that not matter? So the simplicity of an ADU, this is why it's so popular. No parking requirements, very minimal restriction.
Starting point is 00:03:03 Setbacks are usually still that four or five feet range you need to have between the properties. And then the one thing that you truly need to understand is that you've got to find properties that is in the right location. Because a lot of people, what happened, and I see this all the time, people say, oh, I can build and need to use spike equity, great, great cash flow. And they go on buying the D neighborhood. Bro, that's not the way to play it. So you still need to understand the strategy behind it and get. you know in the right location to really what's your strategy always buying the b to c neighborhoods okay right never a either never a either okay right a gives you a lot of problem when you're adding these adu's
Starting point is 00:03:39 the neighbors the city the the permits and all that no it's actually more on the neighborhoods bro oh yeah yeah yeah the neighbor doesn't want to hear yeah yeah yeah and so more neighborhoods more less headache if you get to you know the bs and the c's the ds won't spike the equity that much and then you won't get great cash for from the rentals yeah right but you know this this is something that i think that a lot real estate investors don't truly understand is that like you mentioned real estate there's so many different verticals different place out there right you just got to understand you got to be hyper local yeah you understand your market right yeah so adu is really good on the west coast is growing popular in the east coast it's not too popular in the central of the united states yet right so um you know
Starting point is 00:04:18 most of time it's multifamily in dallas you know it's funny it's i do a lot in the central well South East, right? So North Carolina all the way through like Florida, Alabama. I feel like those areas are prime for this type of business model. It's getting there. Is there a reason you wouldn't want to do it? Like, is there a... I think because the, you know, when ADU was created, they were created in a sense to relieve some of that affordability issue. Sure. And affordability issue, most of the time are in the dense area. So, uh, SoCal, Seattle. Yeah. Um, you know, New York is another problem right now. So it's growing, you know,
Starting point is 00:04:58 but that's why you're going to New York? Yeah. Business opportunity. So, you know, we're always looking at marks to see where we can grow and scale, always. I started off doing ADUs in 2016, right? Background is that I'm a contractor.
Starting point is 00:05:11 So I have a GC trade, right, 20 years in the industry, been building ADU since, you know, forever. So ADU has been around since 1983 in California for a lot of people who don't know this. But because of the affordability issue, they took that play and then gave it to the public, you know, and streamlined the whole process where you can get permit at six months, get this thing built.
Starting point is 00:05:32 So is that fast, in your opinion? Oh, yeah. To get the permit or to get it built? To get the permit. And even built, it's another, you know, four to six months to build after that. So within a year or so, you should be able to have, not just the permit, but the actual structure. The actual structure up, and you can add easily two to three units on a basic ADU play. Okay.
Starting point is 00:05:49 So when you say units, two or three different ADUs. So one building, right, which is about 1,000 square feet in SoCal, I'm giving you an example in Zolk. Yeah, you're able to add a two-story 1,000 square feet in the backyard, right? That gives you the ability to split it up to be one unit on top, one unit in the bottom. Two separate entrances. And then now you can also take the garage and turn that into a J-80U play. So now you can essentially add three units on a single family property.
Starting point is 00:06:18 Gosh, darn it. Now you're, so this is why I love my podcast, right? And now you're making me think of my rentals and are like, can I add an ADU? Can I make more money? Can I, you know, and so, you know, even the ones, man, this is such a cool thing. Are you aware of? And he may not be like, are you aware of any, like, states that restrict this play or that is not illegal? I would say that I'm not aware of any states that are not restricting the play. I would like to say that they are not, they don't have a statewide rule in the guideline to build ADUs. Okay. So certain local city and, you know, are, you know, are. having a problem with being consistent on the ability to what you can actually do. So talk to the city, talk to, you know, the county, see what their laws in regards of the game. And right now, there's about, you know, 10 to 12 states that allow it statewide. Yeah.
Starting point is 00:07:07 Yeah. But primarily the play is really in the dense area. Can you list off a couple of those states just so people in, obviously California? We're short, the whole west coast. Other hand said, the whole literal west coast, Washington, Washington, Oregon, and California. Texas is getting on board with it. That's cool. Yep. Florida, for sure. Yeah. New Jersey, New York, Massachusetts, you know, so some of these states are east coast, west coast, and it's strong to trickle into the inner cities, interstates. But it's taking some time. Jokingly, I said you're going to New York for business, but are you? Part of it.
Starting point is 00:07:39 Nice. Yeah. That's very cool. So you're expanding over into the East Coast? Yeah, we truly want to see how we can grow this play into newer markets, right? Because that's one of my other business models in real estate. It's just not, it's not just building. these ADU to buy and hold and create a legacy but we're trying to look how we can scale and what we've been doing and working with the boardroom, right? Yeah. We're trying to figure out a different place.
Starting point is 00:08:03 So we would buy these property, get them all entitled and cherry pick the ones we want to keep and build and hold and then sell the rest and title flip them. I love that play because that is just like well
Starting point is 00:08:20 the entitlement plan like apartments is huge. It's huge right now, yeah. Huge or even big developments or like D.R. Horton won't buy that piece of land. But if you go buy the piece of land, get it entitled, you can sell it to D.R. Horton and math. You take away their pain point, which is getting a time and done, years and years of holding costs and all that stuff, right? That could be a huge way for you. But in the ADU space, it's a lot shorter time frame.
Starting point is 00:08:43 And so your holding cost is not that much. Yeah. And then you can flip these back out for investors who are truly, you know, want to start an ADU, but don't know the process. Well, so who, who, what is your business model? Like, why would someone want to do ADUs? What is the right business model? Maybe what is the wrong one? Or what, like you just said, like there's even an title play, which I didn't even think of.
Starting point is 00:09:04 But like, what's the traditional business model for an ADU? The traditional model is just people buy single property. They value at it, like a burr model. Yeah. So I like to call it the burn model on steroids. Sure. Pretty much, that's what it is. Yeah.
Starting point is 00:09:17 You buy a single property, you rehab it, you value at it, you spike the equity. And then either you sell it or you hold it. and then rent it out. But in this case, because of the multi-unit that you're adding on, you're able to cash flow greatly on these. And you know, dude, equity doesn't pay the mortgage, cashful pays the mortgage, bro. So understanding that right there
Starting point is 00:09:36 will give people the understanding of using the ADU so that they can build the great cash flow. Do more people go into this short-term rental type play where this is, they give the ADU more almost like a short-term rental? Correct. So I have some old clients, past clients in my word, We built ADUs for them, and they used the front house, the main house, SD, short-term rental. The other three units just to cash flow.
Starting point is 00:10:00 So you said three units. Yeah. How do you get three units out of it? So, again, most people would buy the single family on a 6,000 square foot lot, and they would build a attached or detached ADU in the back, 1,000 square foot, two stories. So you have two units. Uh-huh. Five to 600 to 600 each square foot on each four.
Starting point is 00:10:18 And then you'd convert the garage into a JADU play. So that gives you two plus one. What is it? Jay, ADU? Yeah, junior at the dwelling unit. Okay. So you just convert the garage. You put a big, so when people think about safety or whatever, you just put a big bolt on the door or do you wall it in?
Starting point is 00:10:35 Oh, we walled in. You walled in. Yeah, so take the garage door out, put in the wall, give it a separate entrance. And there's no entrance into the main. That gets walled in. That's correct. Everything is walled in. So, I mean, you are literally, I love doing this podcast because I always go, God, that's so brilliant.
Starting point is 00:10:51 It is, man. Brilliant. Now, you're coming from the contractor side of it to start. Correct. Now, you're an investor, but you're also a contractor that knows how to get through the city and get the permits. Now, that is a unique perspective itself. So you mentioned it prior. You have a mastermind?
Starting point is 00:11:05 What do you call the mastermind? ADU mastermind. Okay. So if you guys are interested in this, first of all, go check out the mastermind. Is there a website or anything? We're still working on it. We're revamping it, but it should be out in a few. Just hit them up on Instagram, let them know that you're interested.
Starting point is 00:11:19 I mean, I'm freaking interested. So come from the contractor perspective. What's needed here? Do we need to make sure there has to be a full bath, right? We don't need parking. No, no, don't need parking. But you do need a full bath. What else?
Starting point is 00:11:36 Do you need segmented bedrooms? Can they be studio size? Oh, yeah. Oh, yeah. I mean, some of these we have, they're actually two ones or two twos, which is two beds and two baths, full baths. The studio is a garage conversion that would turn into a J.DU still has.
Starting point is 00:11:50 That's a 1-1, which is a one-bath, one full-bath and one bedroom and a small kitchenette, so almost like a studio. Oh, my gosh. So would you encourage an investor like me, I have a rental portfolio, to go look at that portfolio and think about whether an ADU play would work? Or do you want to go out and look at a blank canvas and say, okay, I'm going to buy this home. It's a blank canvas. The way I look at it is to say, if you have a portfolio ready, right?
Starting point is 00:12:19 And as a real estate investor, we're always looking to change up the portfolio to see how we can better it. Sure. How we can better the cash. Make more money. Make more money? Correct. And so you will look at the portfolio and see, okay, some property stats aren't due too well. You would disple those out.
Starting point is 00:12:33 Go buy into a property where you can add these ADU place and then spike the equity. And then over 20 years, you know that's just going to go up. Crazy. Tremendously. Crazy. Right now, I'll give the example. And your pay down on the loan is going to be so fast. Correct.
Starting point is 00:12:46 Now, can you get a construction loan for the 80s? Yes. And, well, yes and no. Okay. So here's the tough part that I went through the face of failing a couple of times. In the state of California, I can't speak about other states, but in California, when we're adding these ADU plays, right, in the beginning, we only had the basic 180U, 1JADU play, and then getting construction only as easy because it's below 4 unit count.
Starting point is 00:13:10 Okay. It's not commercial yet. Yeah. In San Diego, we have something called the bonus program that allows you to put up to a maximum of unlimited unit count as long as it meets the far requirements. Yeah. So people were adding on 10, 15, 20 units in the backyard.
Starting point is 00:13:26 Yeah, brother. I mean, it's getting reformed now so we can wait out. That's going to be... That's too much. That's like an apartment. It is apartment. Yeah. So you can put it up to six. And the problem is that with that is that when you go get a construction loan, the lenders are playing this as a commercial play now. And that makes getting a construction loan for it a lot harder because they can't comp the ARV on these ADU units.
Starting point is 00:13:45 Right. They don't know what it costs. So that's the tough part about the ADU play in the very beginning because there's no true track record for yet, right? It's only been around since 2016. And that's why when you say there's markets, like, so we'll look, because we do a lot of marketing in that south-based region, you go into a market like the state of Alabama and there's no comp for any of it. Yep. And that's what makes it so difficult. Because I come across homeowners who they have basically an ADU play and they're trying to sell it for a premium. And when you go try to comp two properties on one lot, borderline impossible.
Starting point is 00:14:17 Because it's not popular there yet. Like, there's nothing else around. Yep. So it's hard to hear a lending play. You just, you have to say, okay, is this a good investment or not? Correct. But the way I look at it, so you can use a heloc to build this. Sure.
Starting point is 00:14:29 Yes. You could use a construction loan for the most part. And then you have just like double, triple or quadruple the pay down of your loans. Pretty much. I look at real estate kind of with the four legs, right? So you have depreciation for the tax write-offs. I have income from the rents. Then you also have appreciation of the market.
Starting point is 00:14:46 Yep. And then you have principal buy down. Yeah, a principal buy down with the ADU play, I think is... It's the big one. Big one. And the big thing that now that you're mentioning about lending, talking about that little bit, the beautiful part is that the government essentially is going to get into backing up these ADU loans.
Starting point is 00:15:03 So they're in the talks right now, and I've been discussing with Tim also, Tim Harriage. Yeah. And we're looking at things like, you know, if governments are going to back these loans, we can potentially go out and lend to ADU investors in the future as well. That's a big play, bro. huge.
Starting point is 00:15:18 Give you a context of how... Tim's the right guy to be talking to, right? Yeah. I love 10. Yeah. To give you some perspective, the ADU space has grown 15,000% since 2016. 50,000. Yeah, bro.
Starting point is 00:15:30 It's crazy, man, how much growth it's hitting right now. And to give you some also other ideas of what they're comping right now for, in SoCal, one of these units can comp for around 400,000 a unit. And Seattle, these guys are comping around 700,000 a unit, brother. And it only cost them to build 300, 300,000. to build. So what is it, as a contractor, what is it, what's it cost per square foot? Now, I understand California versus Alabama is probably different. I like to give the price range and average of how much it costs to build overall. Yeah. Because square foot is depending on location. That's right.
Starting point is 00:16:02 So overall, I would like to say that if you were to build one unit count, right? A unit is like a 600 square foot unit, right? Okay. Cost about 150 to 180,000. Now, 180U, two units in the back, it's going to cost you about 300 to 400,000. But you're making 400,000 spread on these, dude. That's wild. Yeah. Because it gives the appreciation. Correct.
Starting point is 00:16:25 So that's where in markets that you might be in, that's not California, not Oregon, there's not as much historical data. So you've got to be a little more patient there. Correct. If you're going to do it, my opinion or thought, and I'd love to hear your perspective, if you're going to go do the ADU play in markets that are not as familiar with it, be ready to probably hold it for the 10-year run more than a 5-year run. And what we're talking about with people who are in markets that is not ADU-ready but as soon to be,
Starting point is 00:16:57 we would tell them to look for property that has potential and just buy and hold, like as if you were, to rehab, fix, and flip, and hold. That's right. And then just be patient, like you said. Patient. It's going to come. When it comes, you're ready for this play. Well, and the principal buy-down for 10 years?
Starting point is 00:17:12 Yeah, bro. Like, when you do want to exit, oh, my God. Like, I love this. This is, make sure you're reaching out to him. So there's so many other, like, dynamic ways to look at this. So we went over cost. You need full baths. You don't need parking.
Starting point is 00:17:27 You can construct it, essentially, whether it's too bad, two-bed, one-bed studio. You can construct it however you want. Yeah. The real upside is the rents. The rents. What else am I not thinking about about the ADU play? like the simplicity of it bro i mean it's so simple you're talking about you know ground up construction right development most of these multi-family would take years to get done and stabilized right um this is
Starting point is 00:17:54 something you can do in a year yeah and if you have the means for it you can do multiple of these properties so like me we will look at doing five to six a year built wise and title wise we would look to do in title about you know 20 to 30 or even 50 and sell it off and sell it off and you would sell it to people like me or do you sell it to institution? Who do you sell that to? I sell it to mainly investors, right? Someone like myself. That's interesting. I don't want to deal with it. Correct. Yeah. They don't want to have to deal with the pain point I'm going through with the entitlement process. And so when you're finding a property and you say, okay, there's room for the ADU, you essentially buy it and know out of the gate, your intention when you buy that is to go get it entitled. That's right for other.
Starting point is 00:18:35 So do you remodel the front? I do. You do. Yeah. Okay. And so I always look the first, when I look at these is first is the fix and flip look. Okay. Can I rehab the front value at there first? Right. Then I look at the backguard. Can I build the ADU back there? Can I convert the garage into a JADU?
Starting point is 00:18:52 Yeah. How many units can I put on this thing? All right. I know I'm going to make money. I just want to know how much and how I can optimize the build. Yeah. To the square footage at one, right? Then from there, we would go into purchasing the property, get entitled.
Starting point is 00:19:06 Titement process takes about six months. After it's entitled, then we look at our, entitlement portfolio and see which one we want to keep and build and hold, which one we want to just expose it out. And so after that, we would have both side of the play. So is there an underwriting model that you look at that would be any different than like the Burr model or just a simple rental model? Is it just the same? It's almost the same. You just have to look at a few different things. When you're underwriting and deal for construction for an ADU, you have to take into consideration of because you're able to tie into the existing infrastructure.
Starting point is 00:19:41 But there are still upgrades you've got to do. Upgrades, meaning to the water line, the electrical line. So if you're adding four units, you get to, you know, raise the panels, right, into more voltage, to have more capacity to supply power. And those panels, you're talking about electrical on the actual pole, electrical pole. Or if it's underground, you've got to go into the underground. So you've got to look into those perspective. And the other also things that I look at is that if it's a flat lot, Or if it's on a hillside.
Starting point is 00:20:12 Most of the time, if it's on a hillside, I don't even bother. You're out. Yeah, I'm out because the construction and that the whole, the time that I need to do on the, yep. And put the retaining walls up the whole thing. Correct. It's a nightmare. You brought up the point of electrical. So how do you get all the plumbing?
Starting point is 00:20:31 Is that just you dig deep and do you pull the plumbing from the main house? How does all that work? Because going to a backyard, essentially, that shouldn't usually have much plumbing or fanny plumbing. Correct. There's no electrical. tied in so you're you're starting from scratch you're starting from scratch but you're taken from the front so what I mean by that is that even though you you can't tie into the the house itself the sewer line you can go to the front where right where it meets the city street
Starting point is 00:20:54 okay from there you tie it back in yeah pull it from there and go all the way back okay so you you kind of don't have to go to the city and take less of that workout because yeah if you were doing ground of construction for a multi-family bro it's it's heavy it's heavy yeah and I've done that That's a lot. It's a heavy left. The rental model tends to be, we kind of talked about it, and I think we went left. The rental model for the ADU is more traditional long term. Is it usually short term?
Starting point is 00:21:23 Is it midterm? How does it grapple? Midterm. Yeah. I think it's also market, but midterm and market. Midterm, yeah. So, but it is market, right? So, like, you probably don't see much in Arizona.
Starting point is 00:21:33 Do you see much of this in Arizona? It's not growing yet. It's getting there, but it's not that popular. I'm not that popular. It's not that popular. Yeah. What about Vegas? No.
Starting point is 00:21:41 No. Yeah. The market is still too soft over there. Yeah. And I say that because, like, obviously I built my career in Phoenix and now I live in Miami, but traveling nurses were a big play in Phoenix for a long time. Oh, for sure. I would assume these ADUs. And again, when we, but for those of you that maybe still don't recognize the term ADU,
Starting point is 00:22:05 Casitas, your nannies, house. house, like, that's all we're talking about. It's building a smaller secondary home on the property, right? So ADU is just the formal way of describing that. It stands for accessory dwelling unit, basically. That's what I mean. And I didn't even, accessory dwelling unit. I didn't even know that.
Starting point is 00:22:23 And so that's all we're talking about, greeny unit, right? So you would maybe target that kind of, you know, might there for 30 days, 60 days type of thing, not long term, not short term. And that's a beautiful part about adding multiple units, right? you can actually play it out in different ways. Yeah. You can do one unit for short-term rental, one unit for mid-term rental, two units for long-term rental. So you can diversify how you want to play these units out.
Starting point is 00:22:47 Now, how do you compare this? The big craze right now, and this is why I want to lean into ADUs. The big craze is this pad split idea. How do you compare this to that? Like, what are your thoughts? Maybe you haven't thought too much about it. Everyone's, like, taking a house and, like,
Starting point is 00:23:00 building eight bedrooms and home and tearing down the walls. Concepts similar. I don't like it as much. I don't like it. Like, I just don't, so for me, I think the institutional funds will find an ADU more appealing to invest in. Yep. Then a home that is 2,000 square foot that has eight bedrooms in it. Yep.
Starting point is 00:23:20 That's me. I don't know that to be true. There's no historics behind either. There's no historical. Here's a big difference that the long-term play that maybe will help answer that for you. So what you're talking about is cramming multiple rooms into a square foot. space, right, and just trying to get rentals. Yeah.
Starting point is 00:23:40 Cash full. The ADU play eventually what's happening even right now is that they're giving you the ability to sell these units off like a condo. So not only are you value-adding, spiking it in the equity side, eventually you're able to get parcels on these condo map it and sell it individually. Holy moly. So you have multiple exit plays on the ADU. That is so cool.
Starting point is 00:24:04 Yeah. Now this is, you can't. It can't maybe speak right now that everywhere would do this. But this is happening. It's happening. Seattle is happening. Seattle people are already selling out there. That's why their cons are so high on one unit, $7,000.
Starting point is 00:24:18 Yeah. They're selling these right now, right? Condo map it, sell it out, or you can just hold it a rental out. California is happening already. San Diego is already buying into it. Yeah. So by next year, people are selling their ADU. So is of the affordability issue.
Starting point is 00:24:31 I think one of the questions people are listening is like, how do I do all this? Like, who would do that? Who's going to go to the city or the county to get it issued as a condo to sell it off? Now, would it be sold as like a tick, a tenant in common? Like, you know. You need to create an HOA. I haven't gone to the whole full process yet because it's just starting to come down to San Diego. Yeah.
Starting point is 00:24:51 But from what I know that how it usually works is you get condo map, you get HOA involved, create an HOA. And then it has shared water. Electrical is all separate. Scecini is all separate. So you pay separate bills. and you would sell it off just like a condo, right? Dude, this is phenomenal. Yeah.
Starting point is 00:25:11 I mean, you're right. Like, you can't even really compare the two. No? The, I don't love the whole pad split concept. I get it. I get it to. I just, let's just say there's no real exit. Correct.
Starting point is 00:25:25 You're just selling cash flow. Pretty much. And you're dealing with that many tenants. Now, all the gurus and I love most of these guys that are selling this concept, I get it. Yeah, man. I just like, bro, I don't have the ban. I don't have any hair left to lose.
Starting point is 00:25:39 I don't need that many tenants in one home. Correct. That are going to turn over depending upon your business model. So I love this place. Same reason I like short-term rentals. I think short-term rentals had its moment in the sun. It did, yeah. I believe this could be the next wave of what needs to have this moment.
Starting point is 00:25:55 This is the next way, brother. This is the golden age, man. Because this is, I mean, you are the only one I'm aware of really. So you said thatch is. Thatch is suing it. There's other players out there who's, you know, buying into the ADU play, especially in the dense area. Sure.
Starting point is 00:26:08 But, you know, I've built over close to 180 U's by now, right, just from clients and even for myself alone. So that experience alone, I mean, I don't know if there's people out there who's built this many, right, compared to what I've been doing. You built 180?80s? I'll build over 180 years, bro, because we've been building for clients since 2016, and then I stopped building for clients around 2021, 2021, 2020. Or do it for yourself.
Starting point is 00:26:33 Trying to just do myself. And the reason I did for my. myself is actually a pivotal moment in my life, right, because we had some issues with construction and clients and all this stuff. You know how construction goes, bro. You went through the whole process. I know how construction goes. Yeah, brother. And on our side, it's not because we did anything wrong to people. Yeah. It just happened to be that we grew so big that we couldn't control the scalability of it. We went from a team of five to six to ten, and we grew it to a team of 70, doing so many 80s every year. Right. So did it kind of crumble on itself?
Starting point is 00:27:03 It crumbled on itself. It crumbled on itself. And it's not a judgment play. So just so everyone understands and what he's referencing to is that it's very vulnerable at this last boardroom. I talk about having a 2024 that I lost $3 million. That's my money. It's investors money. And what you went through in 2021, I think it was.
Starting point is 00:27:19 21, 2021, 2022, yep. I experienced, and I think you're going to agree with this. I experienced this just because I could do it. Doesn't mean I should have done it. Correct. Because there's a story that goes, there's two friends that have similar lots, same everything. They're going to build 100. story buildings on it one guy starts running he's up to like 60 stories the other guy hasn't
Starting point is 00:27:40 even started yet this guy keeps looking and why these why is this guy getting smoked this bad like they're buddies they should and next you know big storm comes as we all know there's always a storm yep storm always comes always comes the guy who had at this point 10 stories uh and the other guy had 60 the storm took down all 60 stories this guy remained with his 10 yeah and the guy asked the The other buddy, like, what were you doing this whole time? Were you even working? It's like, yeah, I was underground. I was going deep as I go up.
Starting point is 00:28:11 So my infrastructure was deep as I go up. That story just epitomizes my struggles in 2024. I was running really fast because I was building up, but I damn sure wasn't building down. Same with me, brother. Yeah. We were building up so fast. We look at the state you play like this is the time, right? We had to go.
Starting point is 00:28:30 Yeah. And we weren't, we didn't have the great foundation we needed. it to be solid enough to grow this thing. And so that's why we crumble. And that's the other thing that I want to take this into the mindset for a real estate investors that's getting into the ADU play. I mean, we all want that passive income, but passive income, it's not passively built. Right.
Starting point is 00:28:48 It's passive when it's built. That's right. A lot of people don't realize that, brother. Yeah. You know? And I would even make the argument. I just never, I don't think real estate ever. Until you're at a true economy is a scale.
Starting point is 00:28:59 I know, real. I just don't, like true economies of scale. Then you could probably argue as passive. anything under 100 it's just there's no way there's no way brother dude you're still in their rat race but again
Starting point is 00:29:11 everyone has a different end goal yeah I have students who just want 10,000 a month 15,000 a month and cash I love that by the way sometimes I wish I was that guy
Starting point is 00:29:21 I know me too brother I just like that I know I that's great 15,000 one 20,000 one requires maybe three of these properties with ADU plays right where you think about it yeah
Starting point is 00:29:30 so it's very doable when you look at that and that approach You know, for me, my scalability and how I look at things is a lot more great like you. Yeah. So definitely getting to that $100 million plus portfolio in the ADU space and then just grow from there, man. Just remember, build deep. Build deep.
Starting point is 00:29:47 That's right. Everybody, Kevin Trin, if you're interested in what we just talked about, which I'm incredibly interested in. You have a mastermind coming up. Hit them up on Instagram. Kevin, is it just Kevin Trin or the Kevin Trin? I think I started that. The Just, anyways. This guy's phenomenal.
Starting point is 00:30:02 He's in my mastermind board. room. It's really one of the smartest in the space. Comes with the contractor's license. Hit him up, ask questions. He is a genuine human being. I really appreciate you. I appreciate you, too, brother. Looking forward to talking more about it on the next month. 100%. Guys, if you like this and you think a couple people need to hear this, please share this to your friends. I appreciate you. And we'll see you on the next episode. Peace.

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