Buying Houses from Rural Africa

Speaker 1: [0:00] Podcast with your host, Mike DeHaan and Dan Austin. From wins, losses, horror stories, and tactics for optimizing your business, Mike and Dan take a real uncensored deep dive into the ins and outs of running a full time real estate investment and wholesaling business.

Mike DeHaan: [0:21] What's going on, everybody? Welcome to episode 52 of the Collecting Keys Real Estate Investing Podcast. This is the first, I guess, Mike and Dan episode for a little while as you've been rocking through interviews for the past, like, month because I was off fucking around in Africa. Dan was here trying to manage the business, and let's see things that have changed while I've been gone so far. Dan is now back in a corporate workplace. He's I'm

Dan Austin: [0:53] freaking jacked. Wait. That's not the first thing you say. I'm fucking jacked now, dude. You just told me I'm fucking trim. Things have changed in the month. I got I got I'm healthy.

Mike DeHaan: [1:01] Bought all those all your clothes at Baby Gap. You're looking extra buff now.

Dan Austin: [1:07] Dude, especially on camera, it adds 10 pounds in the shirt. You can't even see them. Oh, there you can you see my muscle there?

Mike DeHaan: [1:12] Yeah. Right. There yeah. If you wanna see Dan's muscles, go check out this video on YouTube. It's they're freaking awesome. Disappointed. Very disappointed. I promise.

Dan Austin: [1:20] Yeah. I know you're all fat too from being on vacation for a month. So, like, we're gonna go have our lifting competition this year.

Mike DeHaan: [1:26] No. Well, no. I it's the crazy thing is is just with the nature of my trip. So

Dan Austin: [1:31] Oh, you're in Africa. That's right. Don't have food.

Mike DeHaan: [1:33] Yeah. So

Dan Austin: [1:33] You're starving.

Mike DeHaan: [1:34] But but the woah. Hey. The food everywhere was fantastic.

Dan Austin: [1:39] I I would imagine. So yeah.

Mike DeHaan: [1:41] So it's mean, it's all fresh. Right? Because they make everything there. It's not like they have a ton of imports, that they're bringing in from all over the place or a ton of preservatives, so everything's fresh. But, yeah, for you guys that weren't around before I left, I don't know if I talking about this trip. So I did a, about three and a half weeks three and a half week road trip around Southern Africa, which me and my wife had took us from Cape Town up through Johannesburg and Kruger National Park, up through Zimbabwe to Victoria Falls, and then heading out west through Botswana and finishing in Namibia. Bunch of camping and safari parks through all that stuff. Bunch of, I guess, adventure activities. We went like whitewater rafting on the Zambezi, you know, and some bungee jumping, went broke four wheelers. You know, it's a bunch of tourist stuff mixed in with a lot of, cultural stuff. But, you know, it's one of those trips. It's always fascinating to go for me to go places like that as a American because we just have so little perspective on, like, the world. Like, honestly, like, all the stuff that we get force fed by the media and such a horseshit about, like, oh, you know, this is what third world countries look like. Like, look. These are all the movies about Africa.

Mike DeHaan: [2:51] This is what Africa looks like.

Dan Austin: [2:52] Are you saying that my 30¢ a day is not going to little babies with bloated bellies?

Mike DeHaan: [2:58] No. I mean, it might be somewhere, but that is not like the vast majority of Africa. You know, a lot of Africa is actually pretty developed and pretty nice, but they have like third world problems, you know, like massive wealth inequality, you know, limited infrastructure. But like, for the most part, I mean, most places have good plumbing. Like, you can drink the water in most places that we went. You know, they all have power.

Dan Austin: [3:22] That's surprising.

Mike DeHaan: [3:22] Even though they live in shacks, a lot of people have, like, smartphones and, like, decent cars. Like, you know, they'll have, a Toyota that's, like, 15 years old, but they live in, a mud hut. You know, it's just like

Dan Austin: [3:33] Dude, it's because you didn't go to the right part of Africa. You gotta go like Rwanda or the The Republic Of Congo

Mike DeHaan: [3:38] or somewhere. You're right. So there are there are countries that are like that, and where we went is like the more developed Africa. So one of

Dan Austin: [3:45] the The the rich white the rich white guy real estate investor part of Africa.

Mike DeHaan: [3:49] They're definitely not a white guy real estate investor because we were a mat major minority everywhere we went. But, you know, they they are more traditional because they do have tourism. So, like, they Right. See money coming there. But we met someone that had just gone up through Rwanda and Uganda to see the gorillas and stuff. And he was like, no. That's, like, third world Africa.

Dan Austin: [4:10] This

Mike DeHaan: [4:10] is super bad.

Dan Austin: [4:11] Mean, were the gorillas cool, at least?

Mike DeHaan: [4:13] Oh, yeah. He said they were awesome. He's like, but you're, like, in the true sticks, you know, where people are, like, crazy, crazy poor. But then, like, I don't know. It's it's funny talking to even, like, some of the locals about the different areas. Like, we had a driver that took us from our, the last camp that we were staying in all the way to the airport that we left from. It was like a five hour drive. I had to leave at 03:30 in the morning. And I was talking to him and I was like, oh, have you like traveled much around Africa being a driver? And he's like, well, I've owned in South Africa, Zimbabwe, where he was from, Zambia, and then Botswana, and maybe the same sort of areas that we that we went. And he's like, and I went to The Congo. And I was like, what was the what was it like in The Congo? He's like, don't ever go there. He's like, it always rains. It's he said, you know, he said, everyone's sad because it always rains and there's always war. Don't go there.

Dan Austin: [5:01] Oh my goodness. That's yeah. That's a bummer.

Mike DeHaan: [5:05] I was like,

Dan Austin: [5:05] good advice. Have fun in the comic. Yeah. That's kind of one thing I've thought about because I think it would be definitely jealous. I wish I had an opportunity to go to Africa, but the Congo for some reason, maybe from the movies, sticks in my head. Then West Africa, the Gold Coast for some reason, scares me just with disease. So I'm like, those are the two spots I might stay away from.

Mike DeHaan: [5:28] Well, the West is where all the conflict is as well. Talking to a lot of people about parts of it. I mean, because it's like a huge continent, right? Like Right. You know, thinking that Africa is all, like, one thing and it's all, like, you know, different safety standards, saying, oh, North America's all the same. It's like, well, we obviously know that safety is very different in The United States versus, like, Mexico. You know? Right. You go you go somewhere in rural Mexico, you're much more likely to get killed versus going, you know, by the cartel versus going most places in Africa, I would think. Right. But, you know, there's probably places, though, that are very similar in in Western Africa right now is where a lot of the conflict zones are

Dan Austin: [6:07] due to a lot of the issues. But,

Mike DeHaan: [6:09] you know, it just it's just something that is part of their whole history. I we I mean, ironically enough, on the flight back, we got on the plane, and we're like, oh, they have blood time in on on the airplane. We have to watch this now. Yeah.

Dan Austin: [6:24] No way. Like, oh, like, it was okay. Because you're a business, so you could choose what movie.

Mike DeHaan: [6:28] Yeah. We were business class. You choose well, you should movies and coach anyway. But, they have blood diamond like, oh, we gotta watch this now. And, you know, it was like that that is how most people view Africa, which is like, this, like, war torn sort of place and all sort of things, which exists in parts of it. But seeing in the movie, the guy's like he's like like, in the history of Africa, every time something of value is discovered, the locals die. And I'm like, that is probably the really horrible truth. And then even a lot of places that we went, even though they're good now, they weren't that good that long ago. You know, like when we were in Namibia, it's a crazy place because most of the country is like this huge desert. And rolling sand dunes right out of the sea out of a movie. And it was colonized by the Germans. And I guess back even as recent as the fifties, the Germans had diamond camps there. And what they would do is they would have, like, all of their their workers, which basically means, you know, slaves. And what they would do because the diamonds were so abundant is they would just have them, like, army crawl through the sand, and they would just, like, find diamonds.

Dan Austin: [7:32] That's amazing.

Mike DeHaan: [7:33] It's just unbelievable. Right? But now it's you know, after the Germans, they got taken over by South Africa. They went and, like, conquered it, and then it was under apartheid rule up until it was finally liberated from now, like, '94. And now it's, like, more of a put together place. But '94 isn't that long ago, man. It's twenty five

Dan Austin: [7:51] years ago. No. I was nine years old. Jesus. Yeah. Wow. So So did you see any, did you get to swim with sharks at least, or did it sound like you did?

Mike DeHaan: [8:00] No. We didn't even get to go swimming with the sharks. We were supposed to go swimming with the great whites in in South Africa, but because the weather got canceled. So instead, it was actually pretty sick. There was the, rugby sevens World Cup, which happened to be in Cape Town. Mhmm. And we managed to snag some tickets. So we just went and, to, like, you know, the Rugby Sevens World Cup in probably one of the biggest rugby countries in the world. And Yeah. Which was a super cool experience. We went with all these drunk rugby fans, and I drank the, traditional local drink of, brandy and Coca Cola, which you can get out of a can there.

Dan Austin: [8:33] It's, like,

Mike DeHaan: [8:34] really sweet. Yeah.

Dan Austin: [8:35] So I just

Mike DeHaan: [8:36] drank a bunch of those and had a little party and watched some rugby. Was a good time.

Dan Austin: [8:39] Nice. Well, here's the one question that everyone wants to hear is, like, did you see Elon Musk there or talk to anybody about Elon Musk there? Because he is from South Africa.

Mike DeHaan: [8:48] Elon Musk is a big deal in South Africa.

Dan Austin: [8:50] Is he?

Mike DeHaan: [8:51] Like, oh, yeah. Like, like, you you go around different things. There's a lot of, like, Elon Musk, like books and, like, random things.

Dan Austin: [8:58] I bet because he's probably the hometown. I mean, he's the richest man in the world. Yeah. From Africa.

Mike DeHaan: [9:03] Well, countries like that, you know, they don't have a ton of, like, big people that can out come out of them. So when they do, they really, like, cherish them. And I guess the big person a few years ago well, obviously, Elon Musk has been big, but Trevor Noah has The Daily Show, stand up comic, super popular. We're talking to our guy that was there, and he was like he's like, oh, yeah. Trevor Noah used to be so huge in South Africa. But then he went to The United States, he lost touch with all of us. So now everyone hates him.

Dan Austin: [9:31] That makes sense. Yeah.

Mike DeHaan: [9:32] He's a he's a scab. He sold out.

Dan Austin: [9:34] Yeah. He's a scab. Well, also David Sachs, is Elon Musk's partner, I think, or was Elon Musk's partner in, PayPal. He's also I think he's one of the hosts on All In podcast. Great podcast, by the Not as good as collecting keys, it's good podcast. He's from South Africa. It's lots of smart people from South Africa. Mean, like I'm hoping you caught

Mike DeHaan: [9:54] that back. Have, like, good schools. I mean, they have

Dan Austin: [9:57] Oh, I believe that. I'm just saying, like, in in comparison to the rest of the world to have some pretty high powered people coming from a small portion.

Mike DeHaan: [10:06] Is it Yeah. Well, so I guess what I will say there, what we learned is, there are very first world cities in what is a very third world country. Because, like, you go to the main cities and they're super developed and, you know, the people, mainly the white people that were, you know, benefited during the apartheid area have a lot of money and they can get good education and they can have a lot of development. But around those areas is what you would expect Africa, which is a lot of, like, local native communities, that are, like, super rural where they have, you know, not a lot going on.

Dan Austin: [10:42] So Right.

Mike DeHaan: [10:44] But, yeah, either way, super good experience. If anyone is an adventure traveler and they like to go to places that, you know, make you reflect on life and everything else, I would highly recommend making a trip. It's a long freaking journey to get there. But once you get there, it is not expensive. It's generally pretty easy to get around, and everyone is super nice and accommodating with everyone. Even stuff that wasn't transactional, like we weren't, you know, paying people to do things, The locs in general were super, nice and just stoked to Good. Chat with you about EverEngage. So it's a super awesome experience. But, anyway, real estate stuff. Yeah. I know.

Dan Austin: [11:23] Welcome back. You had fun. Yeah.

Mike DeHaan: [11:25] Thank you. We so while while you while I was gone, we bought, what, 26 properties. So I think we had our best month that we've ever had. And our gross revenue was about 700,000. Is that right?

Dan Austin: [11:39] Man, you don't have to lie to our listeners. We did some grinding. We did some hustle. We did some grinding while you're gone. It wasn't that easy on all fronts, but we made it work. We made some money. We sold some deals. We didn't did we buy anything? I don't think we closed on anything.

Mike DeHaan: [11:58] Didn't close anything. We had a contract or two. Actually, We closed. The Helen Keller house closed.

Dan Austin: [12:05] Oh, yeah. But we didn't buy it. We didn't like

Mike DeHaan: [12:07] We didn't buy it. Did not

Dan Austin: [12:08] buy that one. Yeah. And then it quickly burned, caught fire. So sorry to our buyer on that one. Apologize. Did not You plan for that to

Mike DeHaan: [12:17] can't make that up though, man. Like literally wholesale this house and then was it four days later, the guy, he texted us, he was like, You guys will never believe what happened.

Dan Austin: [12:25] Well, no. So it was two weeks after he bought it, but the thing It didn't even

Mike DeHaan: [12:29] take that long.

Dan Austin: [12:30] It happened four days after he closed on it, But the seller who was still living in the house never told him. And he's I was like, what happened? He's like, I have no idea. I can't get ahold of her. I was like, oh my god. My god. Crazy. Crazy. Yeah. That's kind of how it's all all the sellers have been lately. Just a little while, a little crazy. But no, we haven't bought anything for ourselves lately. We've wholesaled, but that'll be kind of hopefully what we can look forward to is finding some good properties to stabilize and make some cash flow.

Mike DeHaan: [13:00] Well, maybe. I mean, we're in the traditional part right now. This business is so challenging where it's just like the constant cash flow problem. Because, you know, we have several deals that got delayed because of, you know, different things like

Dan Austin: [13:13] We have one deal that's still delayed. We have one deal that's what been like six, seven, eight months. Yeah. That's gonna be a great deal, but it's like, it's delayed.

Mike DeHaan: [13:23] That's a probate deal. Yeah. And then we had several ones that we had longer closings on just because we were having trouble finding buyers with the current market conditions, which we have with three of them closing this month, hopefully, which should be what, $50,000 or so in revenue or figuring it Yep. So we got those ones. We have a bunch of virtual ones that are maybe lining up, maybe not. We have buyers getting skittish on stuff for something like I don't know why, like, rates got over 7% and I guess that might be the mental breaking point for people.

Dan Austin: [13:54] 7% was the breaking point? Yeah. You're you're right. Well, even some sellers, we've had sellers be like, no. I just don't think I'm gonna sell anymore. It's like, well, but we're in a contract, you know? And so we've had that happen in our virtual market. It's, yeah, it's definitely, a numbers game in that. If you have 10 contracts, it doesn't mean 10 things are going to close.

Mike DeHaan: [14:17] Mhmm. Yeah. I mean, it it's always like you can't count the chickens before they're hatched, but I don't know. I appreciate you holding down the ship while was gone, though. But, I mean, it was a good test of just like our general systems, and it revealed, I think, a lot of the flaws and stuff that we need to figure out because traditionally when I've traveled, we've done pretty well. But I've also been able to have, like, some say, but on this because I was, like, literally out in the sticks. Like, there was at least one full week where I had no Internet access the entire time, which at first I was like super stressed for like a day. And then I was like, this is awesome. You know, there's no, like there's no news. There's no like emails. There's no,

Dan Austin: [14:58] it's just you and the people around you in the world in front of you. That's, that's super cool.

Mike DeHaan: [15:03] But but you know what the weird thing is? Even when it was like that, like, I would, like, I don't know, go to take a dump, and I would have my phone, and I would still look at, like, my cashed Instagram posts that were, like, from, like, four days earlier that we're still there.

Dan Austin: [15:15] Like, particularly coming off of a high. You're like, gotta get a hit. I know I've seen this post 12 times.

Mike DeHaan: [15:22] Well, the funny thing is it was like just purely habitual. You don't even think about it.

Dan Austin: [15:26] Yeah. No. I get you. I gotcha. That's that's funny. Yeah. But for that week, you know, the the business didn't keep turning. We we, you know, we we made it work.

Mike DeHaan: [15:35] Made it work for the most part. But, you know, reveal the place that we need to fill some gaps, particularly on the admin side, which I think is the area that we've always struggled to fill. It's just because we're so used to doing it, but there's, like, certain things that, you know, need to be documented better. Like, even one of the like, that week, I went back, checked all of it, I was like, why would our were our KPIs not updated? You know, just, like, super basic stuff. So whether I hit up our VA, he's like, oh, I didn't know when you do that every single week.

Dan Austin: [16:01] And I

Mike DeHaan: [16:01] was like Yeah. You do. He's like, of course, you do.

Dan Austin: [16:05] Like, what

Mike DeHaan: [16:05] the fuck?

Dan Austin: [16:06] Well, that's what's interesting too. You talk about, like, the admin stuff is, like, we have a lot of admin esque type employees, but none of them are jack of all trade. Like, we don't have that. It's hard to have that one person that can consistently do an array of tasks.

Mike DeHaan: [16:19] Well, I mean, it's to be fair, we do have a lot of different admin tasks and this is kind of challenging with the, like a small business. Cause like, I don't know, you don't have an admin at, you know, your w two. If they're just like an admin, they're not doing like graphic design and also true. True. And also, you know, filing reports and also doing, like, whatever. Like, they usually have something for a specific job, which you can have a bunch of redundancies when you're at a giant company, but when you're a small company, you can't have that.

Dan Austin: [16:48] Right. So it

Mike DeHaan: [16:49] makes it a little bit more challenging. But there's always there's always little things. But I think the biggest thing that I realized, while I was gone with, like, the circuits we have is how bad we are about having documentation of processes just, like, in general. I mean, it's been diff it's one of those things that we should have done way back when we started and sort of maintained, which we have, like if you look at our Google Drive, we have about 50 iterations of this that we've started and then just never maintained or, like, never updated or never finished.

Dan Austin: [17:24] I was

Mike DeHaan: [17:24] like, oh, this is, like, our key operating procedures. And then it's like, you know, step one, create the operating procedures. And then that's as far as we got. You know?

Dan Austin: [17:35] Well, in in in our defense, however, like, because our operating procedures have changed a shit ton, we would have been only documenting processes for this whole time. And I think that's inherently a challenge because we have adapted our business as the market changes, like, and as our business has grown and build out those iterations, we just adapt, adapt, and overcome, adapt, adapt, overcome. And to have a standard process that whole time. Like you and I know, a lot of the OG wholesalers aren't in the market today because they didn't adapt. They figure out how to do it one way and then they're like, well, I'm not gonna figure out how to do it that way, I guess I'm done or I'm going to pivot, which is fine. They pivot and go do something else where I feel like the market has been evolving and changing so rapidly since we've started, but we've just always had to adapt and then adjust our business to just keep up with what's going on.

Mike DeHaan: [18:22] Yeah, that is very true. And, I mean, there's still some things that would have remained the same, particularly with, like, how we do our marketing and, like, how we track certain things and all that sort of stuff, which we do ourselves just because we kind of always have better stuff that we need to document and upload. But I'll say that's a good takeaway, though, for anyone regardless of whether you have an investment business or you have any other business. When you're doing stuff for the get go, sorry, at the get go, like, when you're first starting and you're figuring out your general processes, even if you do think you're gonna change it at some point, just record yourself doing it on a Loom video

Dan Austin: [18:55] Yep.

Mike DeHaan: [18:55] So that, like, you can go and you can take that video and you can give it to a VA and be like, this is exactly what I need you to do. And that way, you know, just keep them in a catalog with what they all are or, like, you even know, on Loom, you can kinda put together folders, things like that. And you will be so thankful that you have that when you go to bring on your first VA or another VA or even, like, a in house assistant, whatever. And you're like, oh, I need you to do all these different things, you quickly realize, shit. There's 50 things I to do, and I have to figure out how to explain all of them when they're in my head when you could have just recorded yourself doing it. Like, as you were going instead of at that point, you now have to spend two days recording a bunch of videos and it's a hellish experience. Yep. So

Dan Austin: [19:37] No. I agree. I've been doing that personally too. Is anytime I'm doing something as we brought on another executive assistant this last month, it's like, I'm going do this task because I have to right now, but I'm gonna record it and then send that person a Loom video. Like, this is what you're going to do now. Next time I send this task to you, boom, here's a Loom video. I have her keeping a spreadsheet or a spreadsheet, document, a Google Doc with, like, all the how tos with links to the Loom videos because, like, that is so much easier to at least document at one time and get it out.

Mike DeHaan: [20:08] Yeah. Yeah. For sure. And and once you have put together, you know, even if you just need to create different iterations of it, add it right on. Because, you know, you could have, like, the newest, latest, and greatest thing that you think is how you're gonna be, and you do it for two months. Right? This actually sucks. Let's go back to the other way. We've done that for a while. We spent two months months integrating everything into a new CRM,

Dan Austin: [20:28] and then we're yeah. It's a horrible idea. That was so painful.

Mike DeHaan: [20:31] Back. And then the crazy thing is I remember way back, we're like, oh, well, do we cancel the old CRM now? And the only reason that I didn't was purely out of laziness. And thank god I didn't do that because we've had to restart it up.

Dan Austin: [20:41] Oh, man. Yes. Because we had to and we imported our leads. Right? And then we had to yeah. We had to come back, and then it came back such a shit show too. What a mess. I forgot about that. Yeah. Oh, man.

Mike DeHaan: [20:51] So, you know, give give things time. Don't be too impulsive. Just keep tracking as much as you can. But yeah. I mean, besides all that, we need be going all over. We had our one active flip that we've going on right now. I know it's been super, super fun for you. Yeah.

Dan Austin: [21:10] We're getting to the end of that. I got the photos. I haven't listed it yet. It's kinda funny how that works out, but I finally got the photos on. Great. Yeah, it's nice. It's clean. Had, I would say on this one, which I've complained about doing this flip since the beginning, you know, I haven't wanted to do it just because it's such a big pro It was a big project with the potential to have some open wounds on it.

Mike DeHaan: [21:32] Yeah. And then the seller being just a real piece of work. Exactly. It didn't make it any better. Yeah. We did get a seller. Yeah. We had the seller that we bailed them out of the situation. They were, like, literally in foreclosure. And then we agreed to give them one month free back, and then they had to pay rent for two months. And pretty much the second we bought it, she immediately submitted a maintenance request for a bunch of stuff. God. And we were like, no. Get the fuck out

Dan Austin: [22:01] of the house.

Mike DeHaan: [22:01] Yeah. What are you doing? And then she, like, got super shitty that we didn't go in and fix all these things. And I will also say the main reason to fix it was the stuff was not essential, and we were planning to gut the house when she moved out anyway. And then after, like, she paid us one month of rent, didn't pay us another month of rent, we filed an eviction notice because she was starting to get shady, and then she dragged it on and stayed there for another month till I went through the full eviction process

Dan Austin: [22:29] Yep.

Mike DeHaan: [22:30] And then made me go through mediation and all these sort of things. And she literally sat there and weeped on the phone with the mediator and was like, are you honestly telling me you're going to kick us out? And I was like,

Dan Austin: [22:41] yes. Just cold blooded.

Mike DeHaan: [22:44] Oh my god. At that point, I was so over excited because she was such a snake.

Dan Austin: [22:48] She she was a snake.

Mike DeHaan: [22:50] She'd be so bad on the phone, like, so freaking rude. And then the second she knew she was in trouble, she was, like, trying to play out innocent.

Dan Austin: [22:57] Oh, yeah. No. She was a snake for sure. Snake in the grass. And then well, I mean, basically because of that and then we had other projects we had to wrap up before we started this one because we were actually gonna wholesale it or whatever. We're gonna then we're gonna wholesale it We didn't start until mid August. Bought it in December.

Mike DeHaan: [23:15] We had a partner we're going to work on it with because they had a crew and then they completely fucked us.

Dan Austin: [23:19] Yeah. They screwed us over on that one hard. So we waited two months to start it because we're like, well, we'll just do this other project right now. Squeeze that one in. We won't start this one, which we know is bigger, because they're gonna come in and do it. We're gonna partner split the profits, and that did not pay off one bit. So yeah. Good times. Yeah. But it's all good. It's all cleaned up. It's nice. So we'll hopefully get listed this week and get a nice profit on it and get and pull our all of our cash out because we had to spend a lot more money on this one than we hoped just because like little things like when you hold the property for eight months, shit can happen. Like, I don't know, the air conditioning can break and that's $5. Yeah. And so we had a few things we had to uncover on this one. And these people were, mean, I there was just like some hidden surprises that, like, I feel like they created for us with why they lived there before we evicted them. But anyhow, we we got through it all. It looks way better, smells way better. I mean, that was a big problem in the household. So gross.

Mike DeHaan: [24:17] I mean, did leave us with a freezer full of rotting meat and a jar full of marijuana, like the whole house in a pot And and dead

Dan Austin: [24:25] pee and urine and weird stuff. So yeah, we dealt with a few things on it, but ultimately it's a great property. I wish we could have listed it earlier this year because man, we would have made so much money on this one. But just with the where interest rates are, it's obviously the price just we can't demand the high price point we thought we could, or we wanted to earlier. But it is, I'm still hopeful on it because it is a great house hack. And today, if you're going to buy a house with a high interest rate, you can house hack it. You're doing alright because this one you can get, I would say $1,200, thousand, $1,200 of extra income from the apartment that is on the on the lot that you can legally rent out. So that's super helpful for any potential buyer. I mean, think about if your budget was say, no, we'll probably list this thing around 500. If your budget was 500, like three or four months ago, but you can't afford that anymore, this helps you afford it.

Mike DeHaan: [25:19] It does. Yeah. I mean, I'll take a huge chunk out of it. And, you know I mean, even better yet, young couple something wants to buy. This is the really nice thing to move. Young couple buys it. They live in the apartment. They rent out the big house for, like, $2,500, $3, maybe even. Yep. And now you're really balling

Dan Austin: [25:35] because

Mike DeHaan: [25:35] you're living for free at that point. Yes. And you have a nice asset in an a class neighborhood.

Dan Austin: [25:40] Yep. Exactly. Really nice asset that you can rent out in the future as a duplex or keep or do whatever you wanna do with it. I mean, it's it's a great setup. The the thing that the trick will be is help making sure to convey that to the right buyer's agents so that they can convey that to their seller, which is always the tricky thing. Like, when we're dealing one on one with investors on the off market thing, you're talking with your buyer, generally speaking, right? And you're marketing to your buyer. And with the agents, you're always talking through somebody, you know, which makes it challenging if you're trying to convey benefits to somebody. Like, I'll before I before you jump in, I will try to convey this. I'm doing a listing right now. It was a deal that we had that we were going to pay cash for. We chose the list. I listed it for them. And I had an offer signed around on this thing or signed given to us. And I reviewed it, and I was like it was, like, $20,000 under asking. And then they wanted, like, I don't know, like, only 3,000 towards the the buyer's closing cost. I was like, how about this? I will pay $9,000 towards your buyer's closing costs. And then on top of that, well, I should say, then you pay full price, which was a really reasonable offer. And then the agent said, well, we just can't afford the full price offer.

Dan Austin: [26:56] And I said, do you understand what I'm trying to do here? I'm giving you enough money to buy your your payment down from your for your buyer. And, like, I gave her a screenshot of the calculator. I was like, see how much this is, like, $200 cheaper for your buyer a month? And she's like, oh, okay. Yeah. I'll see if that works. And then she came back and she's like, well, we'll pay full price, but we actually need, like and then some stupid, like $18,000 in seller pays on a $225,000 house. And I was like, what are talking about? She's like, well, my buyer doesn't quite have enough for the down payment. I was like, you never had that your buyer couldn't afford this house regardless. So, like Yeah. Right. Just that confusion on how to write an offer and not realizing, like, their buyer couldn't even come up with 3% down anyway. So not only did they need the down they needed all the buy down, but they also needed the down payment covered.

Mike DeHaan: [27:51] Yeah.

Dan Austin: [27:52] Okay. No. That's it's not that kind of buyer's market yet. Anyhow. Yeah. I digress.

Mike DeHaan: [27:57] That's funny. Yeah. I mean, it's just always challenging that, but you can say, yeah, it's easier with investors to talk to them yourself. I don't know, Talking to investors right now has been like talking to pile of

Dan Austin: [28:06] bricks for the most part. But you're at least talking to the potential buyer directly and you're like, hey. Yeah. You get it that this is like $1,200 unit right here. And they're like, yeah, I get that. You're like, okay. So let's work on the mouth together. And they might still back out because they are a brick wall and they're they're complaining about everything. But, you know?

Mike DeHaan: [28:22] Yeah. This one, though, I mean, I was thinking about this really today. We might wanna get, like, another realtor to list it. Like, just one of the ones that has, like, a lot of viewership on their leads. They have a marketing plan. Just because of that, like, I feel like if it gets in front of more people and that market is said is spread, appropriately, even if we have to pay full commissions, I feel like the chances of finding, like, people to understand that and wanna pay for it are significant.

Dan Austin: [28:48] Yeah. You get a you get you cast a broader net. Yep. Exactly. It's definitely something about.

Mike DeHaan: [28:53] Yeah. Because I guess overall, it would cost us what, like, extra 7.5 in commissions probably. Because we pay one and a half for you because, you know, you have your your small commission, which you may or may not take. And then you have your Yeah.

Dan Austin: [29:09] We wanna pay we wanna pay you that much. I mean, we'd end up paying, like, probably end up negotiating like just a full commission, right? If you're going go with like a high end realtor, that, you're going to pay a full 6. And like right now, yeah, we pay typically like four total.

Mike DeHaan: [29:22] Oh, sorry. I I'm in 7,500, which would be, like, one and a half percent. Onyx is 500,000.

Dan Austin: [29:28] Yeah. Yeah. Yeah. Yeah. There you go. So we're on the same page. That's right. Yeah. Sorry.

Mike DeHaan: [29:32] Yeah. Phone call from Opendoor.

Dan Austin: [29:34] Oh, dude. Sell me some houses. Yeah. They probably want.

Mike DeHaan: [29:38] Didn't they go bankrupt?

Dan Austin: [29:39] I thought they did. So

Mike DeHaan: [29:42] but yeah. So we get that one sorted out here. And then after that, we'll be out of rentals for a bit. And I mean

Dan Austin: [29:47] Well, not technically. We still have a we still have one vacant property we need to rent out, one of our tiny homes. And then we have one in Coeur D'Alene. House? Yeah. The heroin house. Yep. Exactly. We got the heroin house, and then we have one out in Coeur D'Alene that hopefully will close in the next month that we would need to renovate. That And would be probably a buy and hold, potentially a flip. Then we have one, it's a little teaser, but we have another one that might be a rental if we decide to keep it that came back alive. I don't want to go anymore because I want it to evolve a little bit, but man, it's exciting. Juicy.

Mike DeHaan: [30:23] Yeah. This yeah. It is exciting. So yeah. We'll we'll we'll talk about this one in two weeks more, as it sort of comes together, but very much the long story short is we had a seller, like, early twenty twenty one.

Dan Austin: [30:37] Don't share. Don't don't

Mike DeHaan: [30:39] I'm I'm just gonna get the basic I'm gonna give the basic I'm not gonna evolve this deal. I'm gonna get the basic story. Early twenty twenty one, we had a seller back out the day before closing for no real reason. And I don't know, being nice guys or whatever, we said, that's fine, but you need to sign this agreement, that, you know, if you try to sell the house anytime in the next five years, we have first rider refusal. And, you know, it has to honor the agreement that we had in place right now. They agreed Current PSA. Recorded the document. Anyway, I'm I'm gonna leave this with a cliffhanger. We got a call from a lawyer that the lady has died and the house is going into probate. And so we have first right of refusal

Dan Austin: [31:28] on this

Mike DeHaan: [31:28] freaking house.

Dan Austin: [31:29] Yeah. You know, and it's gonna be super weird. It is gonna be super weird. I hope in the next week or two, we have enough more information. We gotta work with this lawyer, and I'm sure we'll get into some weird, you know, legal stuff with it, but it'll be fun. I hope because it was I don't wanna say it was a deal of the year last year, but it was gonna be a cool deal. It was just gonna be a good solid deal, you know, for us last

Mike DeHaan: [31:51] It it was probably gonna be the deal of the year.

Dan Austin: [31:53] And that was was that at the time when we did because I ran that appointment. Was that the time we didn't have an acquisition manager?

Mike DeHaan: [31:59] We yeah. We didn't. I mean Yeah.

Dan Austin: [32:01] Because I I was that's why I ran the appointment. I remember that.

Mike DeHaan: [32:04] Yeah. Because we'd laid back our first one, and we had, we had Ricardo who was doing a lot of our appointment setting. But I remember I actually remember that lead came in. I think you and I were on a meeting.

Dan Austin: [32:14] Was like a Sunday. It was a Sunday. Yeah. You're like, we got a text. We gotta know, we had a website leading. You're like, you wanna call them? I like, I'll call them. We called them. And then that call was on the Real Deals podcast. Remember

Mike DeHaan: [32:26] that? Yeah,

Dan Austin: [32:27] Elliot was like, and he was kind of talking shit. He's like, I bet you guys didn't close that when you're like, actually, we did lock it up. We didn't close it.

Mike DeHaan: [32:34] We didn't we didn't close it really because we decided to let him off the hook. But and also, we shouldn't laugh that this lady died, but she wasn't No.

Dan Austin: [32:41] We're not laughing about that. The situation, we'll have to run down. We'll run it down another episode when we have time. It was man, that was a banger. That was a story. That whole this whole deal from from the beginning, the weird phone calls, the weird girlfriend situation. Wow. It was real banger.

Mike DeHaan: [32:58] Yeah. There's all sorts of stuff. So we'll we'll dive into that in two weeks on our next banter episode. But my god. Just I'm I'm I'm super excited because that's one of my favorite ones to tell people too is all the nonsense that went on that. That's like one of those stories that you tell people and they're like, no shit.

Dan Austin: [33:14] You're like, Pete, that really happens? Yes. It does. Oh my god. Oh, man.

Mike DeHaan: [33:20] So anyway, cool. Alright. Well, anything else, Dan? Any new exciting things?

Dan Austin: [33:27] No. No. Just welcoming you back to The United States. You're malaria free. I'm happy about that that we know of. Sound like you had some clean drinking water while abroad, so good for you. No hep C, which is also another one of those diseases that always gives and never goes away. I didn't assume you'd get that. Now I'm just rattling off diseases that kill people.

Mike DeHaan: [33:48] Isn't that basically an STD at this point? Hep C?

Dan Austin: [33:51] Yeah. We're get that

Mike DeHaan: [33:52] from, like, unprotected anal sex.

Dan Austin: [33:54] Yeah. We're an eventual drug users, you know, sharing needles. I don't know what you do, man. I don't know. No, man, everything's good. We're just excited to have you back and excited to keep things going. Know, it's always good to be back in the same state in the same city.

Mike DeHaan: [34:09] Yeah, yeah, absolutely. Yeah, it's all good. But cool. Well, right on. Well, thanks for listening, guys. Just so you guys know what the sort of pattern is going to be, we are quickly approaching our one year anniversary doing the collecting keys podcast. One year. We are slightly shifting the pattern of what the show is going to look like where, basically, every other week, we will do a banter style episode where we talk about updates on the business, what we're doing, you know, how our stuff's going, different things that we're going to to a changing market. We'll be alternating those Wednesday podcasts with interviews with different people and personalities kinda like we had over the last month. We're gonna be focusing mostly on people that I would say are entrepreneurs or, like, interesting people in the space that are kinda doing, like, big things or interesting things as opposed to I don't know. I hate how on some of these podcasts you end up with, like, here's how this rich guy who, know, was a was a freaking doctor and making $500,000 a year, how they're now worth $20,000,000 and only took them three years. Wow. It's

Dan Austin: [35:17] like, wow. The all the exceptions. Yeah.

Mike DeHaan: [35:20] Yeah. Yeah. And then this then their story is like, well, I decided I was gonna syndicate apartments. I just talked to all my rich doctor friends and said, here, you just give me a bunch of money, and we'll go buy all this bullshit, which is not a good story, but that is abundant, and it drives me crazy. Because it's not realistic of the circumstance that exists for more people, and it really isn't that interesting either.

Dan Austin: [35:40] Absolutely. It's the same story over and over again.

Mike DeHaan: [35:43] Yeah. Exactly. So we we have we have some good ones lined up, that we're gonna be recording here in the next little bit. Super excited for those. If you have anyone that you would like us to interview and reach out to you think could be cool, please shoot us a DM, and we'd appreciate that. But, anyways, guys, if you want to follow us on social media, that would be great. You can find me at Mike underscore Invest and Dan at Investor Man Dan. Besides that, please go and subscribe to this podcast. Give us a five star review and share it with anyone who you think would be interested or has any interest in real estate investing or just maybe likes occasionally good banter. That really helps us grow the show. Besides that, if you wanted to learn from us and learn how to start your own investment business, which is carbon copy of how ours is, go to the instantinvestorprogram.com. We actually have some new programs in that we're gonna be launching here very soon. So go ahead and check that out. And it's not live on that website yet, but if you go and you schedule a call with it, we can tell you about them. So pretty exciting stuff that was gonna be awesome. So aside from that, Dan, you would send us off. It's been a while since you've had shitty send off from

Dan Austin: [36:46] I don't have a shitty send off. Like, I wish I dang it. I should have thought of something really cool, some you say can hey. Can the editors put in some, like, African, like, drum music as we send off? Maybe that would the send off.

Mike DeHaan: [36:59] That sounds like cultural appropriation. We're not even gonna go there.

Dan Austin: [37:02] Oh, come on. Alright. Well, I'll see you guys next week. I gotta shut down.

Mike DeHaan: [37:06] Alright. See you guys next week. Thanks, everyone.

Speaker 1: [37:11] Thanks for listening. Please leave us a review on iTunes or wherever you get your podcasts, and check us out at collectingkeyspodcast.com for tips and guides on starting your own real estate investment and wholesaling business.