How to be Safe When Walking Properties, Strategizing Mike's Property Sale, Double Closing with 2 Title Companies

Dan Austin: [0:00] I created this kind of idea when I was in the army, and it was actually something that kept me alive. And it was like, when I would see a house, if people were shooting at me from inside the house, I would not go into the house.

Mike DeHaan: [0:18] What is going on, guys? Welcome to today's episode of the collecting keys real estate investing podcast. Today is Wednesday. It's another episode of the Mike and Dan show where I, Mike DeHaan, and my cohost here, Dan Austin, talk about real estate investing business and whatever else the flavor of the week is. So anyways, guys, welcome. We have actually an interesting topic that I wanted to start with because I think it is a, it's an interesting real estate story, but also it is a kind of just amongst all the jokes we make about weird sellers and crackheads and different things. That's the weird ones. It's something that doesn't regularly get addressed and that is personal security when you are walking some of these off market deals. So if this is your your first time to this show, our main business is as an off market wholesale style investment real estate operation. And we do a lot of marketing to people that are distressed and sometimes those people come with a lot of personal and you know, mental baggage I guess for lack

Dan Austin: [1:28] of a better word. Emotional, mental, physical, all the baggage. All sorts

Mike DeHaan: [1:31] of stuff, right? Just you know, and make a lot of jokes on this show and other things about some of the situations, but sometimes they get a little bit dicey and so we sent our, one of our partners, he's a bar member of our partners program to a house, What's that? Unknowingly. Unknowingly. Yeah for sure. Was a known situation to this house to go and do a walk through. And basically he got to the house, the guy that met him at the house was obviously using some sort of substance. So he was on meth or something, this energy was not good and there was some weird weird things going on. The guy spent most of the like, the meeting going up and down in like temperament and going from being super aggressive to being super kinda chill. Was asking our partner all these sort of like personal questions where he lives, wants to know his last name, wants to know if he has kids, wants to know all sort of stuff. And then walked around the entire appointment playing with a pocket knife, just kinda like fidgeting with it. It's just a lot of lot of red flags, kept

Dan Austin: [2:39] He was disgusting, late, dirty. The tone was

Mike DeHaan: [2:42] Disgusting dirty, yeah just like creepy sort of guy. And partner called me afterwards and he was like, Dude that was super sketchy like why the fuck did you send me there? And I was like, I'm sorry we didn't know. And then about five minutes later he sends me a headline from like the news here in like late twenty nineteen. This is even an old article, she knows what's happened since then. Talking about this guy's unbelievable rap sheet from the nineties. And this was like news, it was like an alert news bulletin for Spokane that this guy was back in town and was kind of like Back in Spokane. Amongst the public again. Sexual predator.

Dan Austin: [3:18] Right. A violent sexual predator.

Mike DeHaan: [3:20] Yeah. Violent sexual predator. Yeah. He had a history of like trying to strangle women in the park, like molesting kids.

Dan Austin: [3:27] Like a lump in milk jug one.

Mike DeHaan: [3:28] Dude, Doing like all sorts of yeah. Jerking off into a milk jug and like in the parks people could see it in public. He had these different journals and stuff about how he was gonna dismember people. Has been to jail a bunch of times for some reason, we didn't put this guy down with a death penalty and he's out among us still.

Dan Austin: [3:48] You know what's funny about that? Just on the side note, researched this, like level one, level two, level three sex offender, like those are levels. I don't know if it's nationwide or Washington. I'm sure they're standardized. Level three is like, the way that they determine the level is their likelihood of recommitting, and level three is like highly likely to recommit a crime. Like then why why are we why is that person doing this? Like why are they out here?

Mike DeHaan: [4:13] Like honestly, why like why are they free at all? Yeah. But then you know, we have a guy that gets caught with freaking a bag of weed, and they Right. You know, not in Washington, but in other states, they'll go to jail for like thirty years.

Dan Austin: [4:23] Right. Yeah. There's Come some on. That's why I say like, you know, somewhat jokingly, but also serious, there should be some subjectivity to like the death penalty.

Mike DeHaan: [4:32] There should be, for sure. Right.

Dan Austin: [4:33] Look at this one, the court of public opinion, I think we could all agree, Like most everybody. Yeah. Like the majority of people would agree in this case.

Mike DeHaan: [4:39] We just gotta do it like, I don't know. We have everyone like in Gladiator, where they just have to everyone give like a thumbs up or a thumbs down. Right.

Dan Austin: [4:48] Seriously, yeah. Yeah. It's just unfortunate because

Mike DeHaan: [4:51] You know, and like, here's this guy's list of all the shit that he's done.

Dan Austin: [4:54] One thing that as we got into this business that I found out was how a large portion of The United States population lives. And you kind of uncover the veil of, I don't wanna say like the gutter or the dark side, because they're generally not necessarily bad people just because they are maybe in a financial distressful situation. But sometimes you go in people's houses and you're like, woah.

Mike DeHaan: [5:16] Who is

Dan Austin: [5:16] it? I did not expect to see that, but okay. And so next time you go to the grocery store and you see somebody, there's a good chance that their house is disgusting. Honestly. And then like if you see somebody in public, you're like, man, I bet your house is disgusting, it definitely is disgusting. Like there's no if, ands, or buts about that, and it's kinda not nice to say, but like we walked enough houses, and they're like, oh my gosh, it's kinda wild some of the situations people put themselves in on top of then these types of situations. Because we've, I mean, he's not the first criminal that's tried to sell a property to us. We've had other criminals For sure. What was that sex offender who was in jail? He was calling us from jail. And it's funny, happens to be a lot of sex offenders usually actually.

Mike DeHaan: [5:55] Mean, like But why? It's like they have other problems with their life, you know? Like that's get it.

Dan Austin: [6:00] But they also own property somehow.

Mike DeHaan: [6:02] Yeah. So I mean, and this whole situation too, this guy wasn't even the official owner of the property. Right. Deceased father owned it. He was basically just living there and now trying to sell it. But the point being though, I want to talk about just personal security with this because I think it is something that tends to get slightly overlooked because, you know, in your general day to day life, you can normally trust people. But when you are going into these situations, when you're going to the home of a stranger, especially if there are some red flags and talk to them, there are certain things you should probably do. And I'm not saying you need to necessarily like carry a gun and be ready to shoot somebody because I would never, I guess, like, hell anyone to do that. Obviously, you it's your choice, whatever you wanna do. But I even think just, basic stuff, like making sure that there's always someone that knows where you're going. Yeah. And like when you're gonna go there. So if they decide to lock you in the basement or hit you over the head, you'll at least have some part that they can send people to look for you. Right? Yeah. I think that's a really major thing.

Dan Austin: [7:00] If there's if there's any question too like or you have or you're just starting out and you have no idea, it's okay to back up and say, know what? I think I'm gonna bring my contractor back. Or just bring somebody with you.

Mike DeHaan: [7:10] Yeah. Exactly. Yep. Bring somebody with you is what I was gonna say next, I think is a huge thing. I would say number three, don't let your desire for the deal get you into a dumb situation. Like don't feel like you need to, I don't know, go into this person's house if you show up and it doesn't feel right. Okay, be okay to walk away because it's better to be safe than, you know, and miss out on a deal than to, I don't know, get stabbed in some huge house. You know, I think that's a that's a big thing to keep in mind. And then, you know, I would say that the last piece is while you are there, make sure that you are walking through and actively like just being aware of what's going on around you. Especially when you get to the monotony where you're walking through a lot of houses, you're doing a lot of different things, it can become very easy to get jaded. Yep. And just sort of like become familiar with the situation and that's where stuff can get weird too. So generally, just listen to your gut. If stuff doesn't feel right, it's probably not. And if you have a bad feeling about something, you know, address it and approach it a different way or just move on. You know, there's plenty of fish in the sea, you don't need to be risking yourself trying to close a deal.

Dan Austin: [8:25] Yeah. Sometimes you run across things that are illegal. Like Noah Evans, who we had on the podcast not too long ago, and he ran across an illegal dogfighting

Mike DeHaan: [8:33] Yeah. He

Dan Austin: [8:33] did? Operation which he reported. And so there's sometimes things that you should definitely report to.

Mike DeHaan: [8:38] For sure. Right? And we've had stuff like that. I mean, like we we did that house where they had the eight kids that were padlocked in the bedroom. We owned that one. Right?

Dan Austin: [8:45] So we

Mike DeHaan: [8:45] had to get CPS involved. But those are things that you can do, it's more like the volatile individual. But like I remember the house that to this day I'm still very certain was some kind of like sex trafficking ring when it was this creepy old dude in the house, and all of the rooms were curtained off, and he said all of his friends were sleeping, and all of his friends were these zonked out females that were just like laying on the couches or like in beds. Geez. They're all like That's right. Gave some weird vibes for sure, we called the cops on that one. You know, and not being afraid to take action when you do see things as well, think is pretty big. Yeah.

Dan Austin: [9:21] I think so. I have this rule of thumb. I created this kind of idea when I was in the army and it was actually something that kept me alive. And it was like, when I would see a house, if people were shooting at me from inside the house, I would not go into the house. That makes sense. Really basic, right? Yeah. You would be surprised at how often people are like, well, I'm gonna go in the house. When we have all the technology in the world including bombs, and Yeah. Dogs and all this sort of stuff that you can send in and robots now. You can send into this house where you're getting shot at. But sometimes people do think they need to go in there because that's where the bad guys are. It's like, well, know, my rule of thumb is I immediately stop trying to go in and I step back and I think, because they're in the house, I'm not in the house. Once you're in the house with the people, now you're in a very dangerous situation. I kind of approach houses like no shit, like I kind of approach situations like that where I'm like, that looks like a bad situation. I'm not going to insert myself into that situation. It's like just kind of simple rule of thumb.

Mike DeHaan: [10:18] Call of Duty effect dude. They're like if I sprint fast enough, I can straight around the corner and shoot them before they see me.

Dan Austin: [10:23] Let me throw my grenades real fast.

Mike DeHaan: [10:25] Exactly.

Dan Austin: [10:25] Exactly. Yeah. It's just a simple rule of thumb. Just don't go there. So, but it's also kind of like the idea of your spidey sense, it doesn't have to necessarily be people shooting at you, but when you see things, and you just have to be aware. And it's kind of funny because you and I first, when we first started this business, I'm trying to put this in context with somebody who's new, you and I would walk all appointments together, not because we were like, we need to be safe just because we're dorks, and we show up with our blue polos on.

Mike DeHaan: [10:51] Yeah, dude. Yeah. That that was the whole shtick Like, we even had, you know, a couple guys that would be like, hey, you're just like on the website.

Dan Austin: [10:57] Right. Exactly. That's totally it. And, but we would show up like there was no harm, nobody was going to probably harm us like physically, but we definitely saw some weird stuff. I still remember the time we were walking That's true. That one house like everybody in town has walked through that green one. That had like It was an dude that was like right off of whatever road, the Maple or whatever. Yep. And I walked upstairs and like there was like partially the roof was gone. Mhmm. And I looked around the corner and there's just a pile of like needles, like syringes. And there's nothing up there, like it's just bare bones wood and just nothing. It's like a 100 year old house.

Mike DeHaan: [11:30] Mhmm.

Dan Austin: [11:30] And all these like pigeons flew around and like went right by my face. It scared the I mean dude, I was so sketched out. Like I was for sure, I saw those needles. Yeah. I was like, oh man, there's there's drug addicts in here somewhere. There wasn't a bit of copper left in that house. Mhmm.

Mike DeHaan: [11:43] Yeah. No way. That one was stripped down. Yeah, that was the one right by Planet Fitness. Yes.

Dan Austin: [11:48] If you're

Mike DeHaan: [11:48] a Respoken investor and you're listening to this.

Dan Austin: [11:50] Yes. Avery's walked that house. It's still as of the soul.

Mike DeHaan: [11:54] Well, kept it but now now there's like windows and stuff on it, rents it. It's like a livable house again.

Dan Austin: [11:58] I'll have to drive by and look at it, gross.

Mike DeHaan: [12:00] Seriously, next time you drive down Maple, look at it. There's like

Dan Austin: [12:03] That house is so much work.

Mike DeHaan: [12:05] Yeah. Was this for sale sign. Yeah. Yeah, I mean I think he ultimately fixed it. Because remember he owned like the strip mall that was right next door to it.

Dan Austin: [12:12] Oh yeah, yeah. I remember that. That's like mostly vacant.

Mike DeHaan: [12:15] Yeah, yeah. All the time. Anyway, so point being though, just be smart right? And don't don't be like a little bitch about it. So you gotta get into weird stuff sometimes, at the same time, be smart. And if something feels like it's just not right, use your common sense and don't try to deal with something that's gonna be a dangerous situation just to There's make some so many other houses out there. You know, there's what? A 100,000,000 houses in The United States. If you miss out on one, you go on the next one. It'll be fine.

Dan Austin: [12:44] Right. Yeah. Don't be a wuss though. If you're gonna have to crawl around in the crawl space, do it. I've had to do it. I don't like it. Hate it every time. I've gone on my belly. Yep. Gone in there.

Mike DeHaan: [12:53] Yep. I know. I mean, even I've done that too and I'm freaking big boy. You're squeezing When in

Dan Austin: [12:59] you see the little eyes looking back at you from under the house, you know, it's there's a rodent problem. Yeah, right.

Mike DeHaan: [13:06] Promise it's not like a Japanese monster from a horror movie. It's just a rat.

Dan Austin: [13:10] It'll be a large rat. Or possum. I don't know if we have possums.

Mike DeHaan: [13:14] Here? I don't think we do. I don't know. We don't really have a major like pest issue. No. Raccoons. We have raccoons. Bastards. Because I always remember going to that house in Wallace and walking up the stairs, and literally I came around to the bedroom, and there was like six raccoons that all like froze and just stared at me. The whole family. And then the second they saw me, they like scurried all over the place to like get out of the open window. I

Dan Austin: [13:33] don't mess around with raccoons, dude. Those little what do they call them? Like like trash rodents or something like that?

Mike DeHaan: [13:38] Trash

Dan Austin: [13:39] bandas. There you go. Yeah, dude. They're real bastards.

Mike DeHaan: [13:42] Anyways, so that's just a public service announcement I wanna talk about because it was actually a good reminder, since you run a mostly virtual business these days that like stuff can get weird. So make sure that you are treating things appropriately. Yeah. Anyways, but besides that Tim, what's going on with Humune? Have we finished renovating our little lease to own that we bought yet? I thought I know that you were out there swinging a hammer, you know, trying to get

Dan Austin: [14:06] it done. We haven't even started renovating it. Haven't even started. No. Actually, we have a guy out there today taking a

Mike DeHaan: [14:13] look at it. Oh, really?

Dan Austin: [14:15] Yeah. So we're not working on it.

Mike DeHaan: [14:17] That was kind of a sarcastic comment. Was I was thought you were gonna say nothing. No. No.

Dan Austin: [14:20] We got someone out there taking a look and I've got I've got almost all the pieces lined up on it. It's just kind of like piecing together sub subcontractors. So it's kinda like for this situation because it's such a light rehab, we're just kinda subbing out flooring, probably painting and fixtures. Like it really doesn't need a lot of work. It's it's Vinyl Village but it's enough of a it needs enough of an upgrade that you have you can't just call it a flooring guy or just a painter guy and this is always the the trick when you're doing renovations whether it's a flip or just for your personal portfolio is who do you call on some of these projects because there's always that work that if you like, if you call the flooring guy, they're like, yeah, don't do that. Or if you call a painter guy that just paints, like, don't do that. And like, well, if you I mean, you gotta take those off, just put new ones on. And sometimes you'll find a person that will do multiple things or like a flooring guy that's like, yeah, dude, I do trim work and all that stuff. I'll do that for you. So then you kinda find the things that you can add to, but in lieu of having like a full crew coming in, like which on this one we're really not, we just kind of need more like large, we need a painter, we need a flooring guy, kind of like a handyman.

Dan Austin: [15:26] So I've got a guy out there that can meet a few of those needs and so we'll see how that goes and get it in there. So cool. So figure it out. Yeah.

Mike DeHaan: [15:34] Yeah, it's funny. It's saying that the blessing in

Dan Austin: [15:37] a

Mike DeHaan: [15:37] curse of having a large enough portfolio to carry your carrying costs, it's great because you don't necessarily have to worry about having those carrying costs, because they'll just get absorbed But by the rest of your the downside is that it's very easy to not process.

Dan Austin: [15:53] Right. I was telling this to the investor group on one of our calls maybe last week or something. We treat our portfolios like a shock absorber.

Mike DeHaan: [16:02] Mhmm.

Dan Austin: [16:02] And meaning that they can absorb oopsies, it can absorb the gotchas, but also it can absorb some risk, and so we can take on projects or we can take on overhead cost with for a higher risk project or a longer term flip or a longer term exit or even if it's short term because now we use that portfolio as something that kinda covers those costs so we're not making poor decisions out of urgency. The funny thing is is we as flippers and investors, we want to maximize our ROI, but you don't wanna make a bad decision just so you don't have to make another $1,800 a month hard money payment or something like that. In the grand scheme of things, like 1,800 is not that much money, and if that's what makes or breaks your deal, like the hard money lending cost, then you've probably got really really bad hard money or really really bad deal. Yep. And so, having that, the goal of the portfolio is really not even the passive income necessarily. The goal of the portfolio is to give you opportunity and to shock absorb so that you can continue to to swing at the fences and hit those doubles, those triples, and those horrible ones every once in while, as opposed to always getting these base hits of $200 a door, $200 a door, you know. Those do add up. Mhmm. But I think the upside, and my point in this whole conversation is not the $200 a door, it's having that opportunity to take the the bigger swings for those larger deals where you have a $100,000 upside.

Mike DeHaan: [17:25] Yeah. Definitely right. And it's all, you know, it just finding different ways to alleviate that cash flow problem like that I think is always so huge. So otherwise, you can't get into a spot where you suddenly have these huge carrying costs and liabilities. Yep. And it's that has to come from somewhere. Right. And that's where you get when like you're a new investor and you're like, oh man, I'm just like feeling cash crunched, I can't afford marketing because you know you have all these carrying costs coming your way. Totally. And that's a really uncomfortable place to be.

Dan Austin: [17:51] This is in alignment with the massive income over passive income, but the goal, I believe, at the end of the day should be that you are producing enough active or, you know, just income from whether like high w two or like your flipping business or your wholesaling, you're creating enough income that you need to and choose to invest in real estate as a mechanism to utilize leverage, debt, and using that to magnify your money Mhmm. But also for the tax benefits. It shouldn't just be solely, which we've all focused on when we started out, and a lot of the online and social media people out there were talking about passive income, passive income. If you can just get 10 houses with cash flow, a thousand dollars a month, you've got a 10,000 a month job. Not in reality, that's not how that works, real estate becomes less and less passive over time the more you own and all that. But my point being is, leveraging real estate not for the necessarily the cash flow, but for the debt you get with it, and also the tax benefits you get with it when you have a high earning, another high earning active income

Mike DeHaan: [18:53] Mhmm.

Dan Austin: [18:53] Through flipping, wholesaling, or a job or something like that.

Mike DeHaan: [18:56] Yeah. I mean, and I think that that is the original intention of real estate investing. Right? Yes. And now it's it's become something that more of the masses do because it's, you know, been talked about Robert Kiyosaki and everyone else. It's a great way to build wealth for sure. But just like the way that it just sold, if you look at like the bigger pockets era Yeah.

Dan Austin: [19:16] Is not the reality. Yeah. It's not really that valid anymore anyways, for the time being anyways.

Mike DeHaan: [19:22] Yeah. So regarding these holding costs, want your opinion on something. Mhmm. And this is something that we haven't talked about. So you guys can hear this live on air. Oh. So I don't know, a few episodes ago, what episode was it? Let me see which number. It was one of our most popular episodes that we've had. Episode one thirty four, we it's titled Are Rental Properties Worth It? And we dove into, you know, how I have so much equity in my current rental property, thinking about selling them. So that I can, you know, just get that money back, so I can probably make more with it doing other things just with the amount that I have there. Looking at like the fact that there are several properties that are gonna start to have renovations, like, you know, basic upkeep stuff that's gonna be relatively expensive coming up over the next little bit, and looking at, say, you know, capture my gains and just move on to something else. And so this is the situation that I'm in. So I have one of my houses, it's one of my newer ones up on 5 Mile that I've owned for over five years now, bought them in Overall 20 they've been great properties, very little sort of upkeep and stuff that I've needed. I found out that one of my tenants is moving out at the end of October.

Dan Austin: [20:28] Mhmm.

Mike DeHaan: [20:29] K? So it's gonna be going vacant at pretty much like the worst time. Yep. Going into the holidays. K? My plan is to sell this house. So I have three options really. K? I can list it on the market, like you know, fix it up, list it on the market during the holiday period. I can rent it out for on like a six month lease, or try to get someone on a six month lease, which is hard, and have them live there until, what would that be, April? They might do damage to the house. There's gonna be some hurdles that come in there. There's gonna be other things. I'm gonna have to like fix it up, do repairs, then put that person into it. Okay? And then list it in April when it'd be more opportune. Or I could just carry it through like say, the end of January, into February, then list the house, but I would be carrying a liability for four months. Which would be a total cost of, I think it's about like $6, if I look at the mortgage payments.

Dan Austin: [21:22] That's all your utilities, taxes, insurance, all that?

Mike DeHaan: [21:25] So I've in fact, you're right. With utilities, you're probably more. I'd probably be closer to $7 if you consider heat and things like that. Yeah. What do you think is my best option here?

Dan Austin: [21:34] What would you do in my shoes? What is the percentage the 7,000, what is the percentage of net gain is that that you're doing up by holding onto it without anything?

Mike DeHaan: [21:43] That's a great question. So my total profit when I sell the house should be about a 160,000.

Dan Austin: [21:51] So like probably 4% of your net gain? Does that math work out? Four ish percent, three to five, somewhere in there, I don't know.

Mike DeHaan: [21:57] Yeah. Yeah. About that. Yeah.

Dan Austin: [21:59] Yeah. How much work does it need, do you think, to get that?

Mike DeHaan: [22:02] I mean, so I I fixed it up pretty heavily before the current people moved in Right. Because it was transitioning out of being a house for the state where they'd kind of trashed it, right? Because the people in the wheelchairs that were ripping around, they're doing dumb shit and just destroying the walls. So it's like in good condition. I I mean, I bet it would need, I don't know, let's say $2.

Dan Austin: [22:21] Yeah.

Mike DeHaan: [22:22] Just like say fresh paint, fix up all the odds and ends, make sure everything works out. So that's probably relatively conservative I think.

Dan Austin: [22:32] Yeah. Here's what I would do. My plan a would be to find somebody close to me that needs a place to stay for a short period of time through the holidays. Mhmm. Or potentially even a fire family, which is what we're renting in our medium term rental right now is like looking for some fire families. We had a fire recently near us that burned, don't know how many homes, but quite a few. Like a lot, yeah. So you could be looking for something like that. And then, yeah, I would say let it ride. What's the point of the headache of trying to lease it, getting it fixed up with the risk of the move out process, right, is such a headache. But if you can find somebody that say, hey, wants to, you know, cover your costs and and you trust reasonably well that just needs a place to live for a while, I would do that. That would be my priority choice. The carry cost, don't really care that much about if I plan to sell it anyways.

Mike DeHaan: [23:18] Yeah. Yeah. Mean, that's not a bad bet. Yeah. Because I I guess my concern is with going to the open market with the rental. You know how this whole process goes. It's a shit ton of work. Right? And even if I use like a property manager or whatever, like, they're still gonna be like, hey, can we review all these people? Half the people that come in are gonna have freaking pets and like different stuff for kids. And so I'm gonna have to fix up the house after the first person moves in. Yep. Like, I'll make a little bit of cash flow over the next six months, and then I'm just gonna have to fix it up again in six months when the next person moves out, and like net, that will probably be similar.

Dan Austin: [23:51] I got an idea how much you're trying to, what do you wanna list it for?

Mike DeHaan: [23:54] $4.50.

Dan Austin: [23:54] $4.50? I'll take it off your hands for $3.80 today.

Mike DeHaan: [23:58] $3.80? Yeah. Right.

Dan Austin: [23:59] I mean, 10% sales cost is gonna go away.

Mike DeHaan: [24:01] Yeah. That's true. Yeah. But the thing is though, is I know you're gonna you're gonna list it for me for less than 3%. Son of a bitch. Yeah. Yeah.

Dan Austin: [24:09] Okay. Yeah. I'm with you. That's funny though. Yeah. I like that idea though of not bringing in a headache since it is such a short run. Mean, talking November, December, January, three months ish, maybe February, but three months of dealing with it. Now you have less stress to turn it. You can get the quality work, wait till you get a guy to come in and do it. You live nearby it, so it's not like you're worried about it being vacant. It's in a class a, a class neighborhood, whatever you call it. So it's not, there's no risk of much going on. So that's just my perspective. And trying to sell a house even in November and December anyways is trash, let alone rent it out.

Mike DeHaan: [24:45] I know. I know, that's a whole other thing. But at the same time, part of me is like because of the location of it, I guess, why do you think is the risk of me just getting it fixed up and throwing up in November? Yeah. It's actually like you know where it's at. I think it's a great spot. I think that there would still be plenty of interest at that period of time.

Dan Austin: [25:01] I think so. I think you're probably right. It's not my money, so I'm taking this speculative approach, and what if in Q one they decide that they're going to do a rate drop?

Mike DeHaan: [25:08] For sure. Right. Very valid.

Dan Austin: [25:10] And all of a sudden people are out there, all the all the realtors are out are out there like, hey, hey, marry the house, date the rate, date the rate, you're

Mike DeHaan: [25:19] like, The right, plus side is I got two chances, I own the one across the street too, so I shouldn't make up the money all the

Dan Austin: [25:24] Well, you set the comp,

Mike DeHaan: [25:26] right, because they're identical houses. True, that's true. It's just interesting, you know, those are the questions though, right, of like, Yeah. The problem with trying to forecast what they're gonna do in the market as a whole is you just never know. And maybe I'll ask Aaron Wichita about this in a couple weeks when I'm down in Austin because he's really into like the macroeconomics. If you guys missed that episode with him, I'm just gonna plug old episodes today. That episode with him, 135, he's just a freaking wizard.

Dan Austin: [25:53] Oh he is.

Mike DeHaan: [25:53] When it comes to knowing, I guess like the dray the market's gonna go, then you should definitely go and follow his stuff. But I'm sure that he will have some sort of metric about what is the common thing to do in election years. Mhmm. Whether like what they're gonna do with interest rates. Right? Because 2024, big election coming up. The federal government is just an absolute fucking mess right now anyway.

Dan Austin: [26:17] Yeah. Both presidential candidates will be in jail by

Mike DeHaan: [26:20] the time it's done. Either literal jail or one's gonna be just in like a mental jail. She's be vegetative at that point. But see Nancy Pelosi is trying to like run again. She's like 90 years old. Is she really?

Dan Austin: [26:32] Is she trying to come back? Yes.

Mike DeHaan: [26:33] I don't know.

Dan Austin: [26:34] What motivates you to do that?

Mike DeHaan: [26:36] She's like she's like my insider trading isn't working as good anymore.

Dan Austin: [26:39] Yeah. Right. I don't have any insight anymore yet. Right. You know, she's still hooked up.

Mike DeHaan: [26:43] God. Of course she is. Yeah. Once you make those connections they don't go away. But you're completely right though, rates could come down, stuff could change with that. But also too, here's my contrarian view, is looking at just like the local economics, right next door to there they're gonna be starting in development. So what happens when they start throwing up new houses right next door and will that and like you have all those builders that are starting to try and do pre sells in all those houses that are gonna be very similar to mine but nice and brand new. Are those gonna start to devalue mine because mine are five years old?

Dan Austin: [27:16] Yeah. Probably. Because they're because yours aren't old enough to where it's like a different neighborhood, a different this, that, the other, like and like there's no argument for like, oh, will have character. No, doesn't. Because it's

Mike DeHaan: [27:29] gonna be

Dan Austin: [27:30] the exact same, just five years older, the one down the road and the the new one down the road will have the new LVP in it.

Mike DeHaan: [27:35] They will and they'll have like the stuff that they learned from building ones that my house are in of like, well we add an extra window here, it makes it that much more appealing. What if we change the layout this way? What if we made this extra open concept? Exactly. Right? And so, know, there's there's always lots of different things. I don't know. I think that the big lesson with that is if you try to always be predicting that, you'll just never do anything. So you just gotta figure out what makes sense with your timeline and risk tolerance. Yeah. Yeah. So Yeah. I appreciate the insight. I'll let you know when I need the listing paperwork so you can throw it up on the market for me.

Dan Austin: [28:11] You got to fill it all out though. No. No. What's

Mike DeHaan: [28:13] happening here?

Dan Austin: [28:14] I'll just give you my MLS key.

Mike DeHaan: [28:15] I'll tell one of our VAs

Dan Austin: [28:16] do it. Harvey knows how to be a realtor by now.

Mike DeHaan: [28:19] He does. He's done all of your reoccurring education enough times at this point.

Dan Austin: [28:23] I didn't say that publicly, you said it.

Mike DeHaan: [28:25] I mean allegedly, allegedly. Oh, it's fine. Our our business coach freaking has his VA do his pilot stuff. Woah. I did not say that either. Yeah. Right. I'm sure it happens everywhere, dude.

Dan Austin: [28:39] Oh, for sure. Anywhere there's a VA, we there's a whole staff of VAs out there that are highly qualified at something. Firefighters probably, they're probably qualified at like, I don't know. What's another thing that has to have like some sort of like annual training? They're all engineers too probably. Probably.

Mike DeHaan: [28:55] Just like everything. I don't know. Is there anything that doesn't there's a bunch of them that are like hairdressers like they Oh my gosh. That's probably like cosmetology school. Probably make you re up for that every year. No. But they

Dan Austin: [29:05] probably know the health codes around, like, waxing buttholes. There's

Mike DeHaan: [29:09] gotta

Dan Austin: [29:09] be some, like, public public thing that you have to do some, like, sort of, like, public health thing class you have to take for that one. I don't know. Maybe not. Consider it pink guy or something. God.

Mike DeHaan: [29:21] Anyways, cool. That's my plan with those. And then

Dan Austin: [29:24] What else we got? Anything?

Mike DeHaan: [29:25] I don't know. I think that might be it. Yeah. We're just kinda chugging along right now. Trying to get some more stuff moving, more stuff closed and signed around. Our pipeline is looking pretty good in September. Now looking into October, we're a little quiet. So I'm hoping we get some stuff moving here pretty quick.

Dan Austin: [29:40] Yeah. We'll get some things signed up. Yeah. So it's been

Mike DeHaan: [29:43] a weird situation with getting new deals. I feel like we've just constantly been dealing with the classic situation of the landlord being weirdly sympathetic to their non performing tenants. That's been like our number one reoccurring thing over and over and over again. Right. And then we just had title issue after title issue. Yep. And it's one of the challenges with the off market real estate world is you run into these situations that you like just can't make go faster. No. Like you're kind of subject to whatever the legal process is within the city It's or just like, well, it is what it is.

Dan Austin: [30:16] I think it's interesting because we've had some like good deals that just go sideways for whatever reason, dumb seller

Mike DeHaan: [30:22] Mhmm.

Dan Austin: [30:23] Bad title, whatever, something something. But we are literally doing a deal right now where the seller the seller said there, we don't want any assignments, you cannot assign it. Mhmm. So we get that every once in while, and we'll take it out of our contract. We'll just say we're not gonna sign it, whatever. And we don't. But not only do they want not want us to sign, they wanna use their purchase of sale with their realtor. Okay. Fine. We can do that. And they wanna use their type of company. See. Like, in this case, we are technically assigning you, but we're buying it. So we're actually coming to the table with cash and closing with one title company and a whole set of contracts, and then we're going to go to the buyer's title company because the other title company also refused to do a double close. They're like, oh, you can't do that. I'm like, I'm pretty sure you can. Definitely. But it was one of those situations where it was just too much work. So then we're now we're taking that house that once we close on it and selling it right away the very next day to another title company. And the title company on the buyer side's like, totally cool. Hey, why don't you just give us the original PSA so we know exactly the chain of events that are happening, and we'll just close it with them, and they'll pay us off, and they'll be happy, we'll build our fee into the new sale price, and all that sort of stuff. And that that one is pretty close to it's gonna close this week, and we're like I'm like 98% sure that one will close, even though we're like literally walking a tightrope. Yeah. You know what I mean? But then other times, you'll have a deal that doesn't close because the seller couldn't get their corporate resolutions for their LLC that the property's owned in, and then it expires past the close date because they couldn't do that, and then they just like disappear and come back two months later saying they wanna sell again.

Mike DeHaan: [31:55] What? Well I think it's also too, this is a good lesson why it's so important to make sure that you have a title and escrow company that gets and they kinda know how to play the game. And this is honestly one of the biggest challenges with our partnership program has been, you know, we rely on our partners to bring their title and escrow company, And then it turns out that the title and escrow company they've worked with for years is like absolute freaking trash. And they don't know that because they've never had to do any deals that weren't just like off the market. Right? That were outside the norm. And it just caused problems, sure, like the corporate resolutions thing. We've had several of those where like the person is holding up forever because they want these articles of incorporation stuff from the end buyer of the deal. They're And just like, I don't even have that. I'm a one person LLC. I need to go and get an operating agreement and It's just like but if you have an escrow company that gets it, they'll at least be like, okay.

Dan Austin: [32:49] They can figure things out. They have they understand well, they understand the rules and the rules of the game enough that they can make adjustments and kinda do audibles, so that everybody gets what they need to do. And a lot of times, a good title escrow company becomes somewhat of the transaction coordinator, and you'll know a bad one when they rely on the brokers to do all the work. Yeah. And so they're used to having two brokers on each side, and those brokers do all the communication, they do all the work, which, good for those title companies, really crappy for the brokers, but then what that does is when you're in off market real estate, you're like, there's no brokers, and so you basically have to become the broker on both sides and make sure that all parties are doing what they're supposed to be doing at all times.

Mike DeHaan: [33:28] Yeah. And it's the worst thing ever. I mean, like right now we have several that they're reaching out to us and they're like, hey, we need this information from your buyer. I'm like cool, go frickin' ask

Dan Austin: [33:38] I specifically gave you their information, their phone number, their email, their first child's name, so you could literally contact them when you need them, but that doesn't matter.

Mike DeHaan: [33:48] Yeah. Or even worse is like, hey, can you get your seller's payoff statement Oh, that for would the frustrate

Dan Austin: [33:54] me the most. I'm like, no, actually I can.

Mike DeHaan: [33:57] God, all the time. Like legally, they're not gonna give it to me. It needs to come from the seller.

Dan Austin: [34:03] Yeah, exactly. Oh my gosh.

Mike DeHaan: [34:04] So ridiculous. So anyways, part of the business that's where that's where you make your money. Yes. Cool. Alright, guys. We'll call it there. Thanks for listening everyone. And do you have any other opinions on what I should do with my my rental property and the little gap time I may or may not have? You should shoot me a message on Instagram at Mike underscore Invest and let me know what you think because I would be very interested to hear your thoughts. If you need

Dan Austin: [34:26] a place to stay, let me know. It's gonna be vacant so I will rent it to you for a good price.

Mike DeHaan: [34:30] Yeah. You can arbitrage

Dan Austin: [34:31] I'm arbitrage Mike's property.

Mike DeHaan: [34:33] You can tell me that you're gonna lease it and then go behind my back and then re lease it to somebody else Exactly. And then make a Instagram account about how you make $30,000 net, but you don't own any real estate. Some bullshit. On my Airbnb arbitrage. Yeah. Airbnb arbitrage my house. That's all other conversation for their ballgame. I just anyways, yeah, you should hit me up on Instagram, Mike underscore invest, and let me know what you do because I'm interested to hear other people's opinions on it. And if you want to follow Dan, he's at investor man Dan too. But right on. Well, thanks for listening, everybody. We appreciate you all. Please share this with anyone who might be interested in real estate or just listening to some, you know, banter from two guys that are occasionally entertaining allegedly. So it's what we've been told. But, however you learned about this show, that's easiest way to spread the word is to share it with people about exact same plan. So do that. I know it does, it's a huge favor for us. We really appreciate it. Besides that, thanks so much everybody. We'll talk to all next week. See you.