It's Time to Start Executing

Speaker 1: [0:02] Welcome to the Collecting Keys Real Estate Investing 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.

Dan Austin: [0:25] Hey there. Welcome back to another Collecting Keys Friday Focus where Mike or I talk about something that's relevant to the industry or something that's just top of mind or going on in our business throughout the week. I'll be your host today, investor man Dan, or as my mother calls me, Dan Austin. For today's episode, I wanted to share or maybe just express some of my thoughts around the current market conditions. You know, it just really seems like every day there's another headline or a story or an article that says, hey, we're in a recession. Another one that might say, hey, well, technically we're not in a recession. And then there's also headlines out there that say, you know, real estate market is fine, or others that say, yeah, the real estate market's gonna crash way bigger than 2008. I'll tell you what, I don't have a crystal ball, so I don't know what's gonna happen in the future, and I'm not smart enough to even figure out what's going on on the macro level. What I know is what I know, and I really do just try to stay in my lane. However, what I can tell you is that the real estate market is local, and that does matter. And I can also tell you that it's not too difficult to understand what's going on in your local market or wherever your farm ground is for investing by just putting your ear to the ground and listening to what real estate agents are saying, looking at things like days on the market, listening to peep what people in your circle are saying about trying to buy or sell their personal homes. My point in bringing all this up is that if you just keep reading the headlines, you're going to get stuck in analysis paralysis because there's a talking head on either point of view saying the market's going to crash, the market's not going to crash. Real estate's looking real good, real estate's not looking real good. And I get a lot of, you know, new investors asking me what they should do or asking what I would do if I was them. And I'll be honest, what I'm doing might not be the right for you because I have a different risk threshold, financial position, experience, knowledge, etcetera.

Dan Austin: [2:13] If you've ever listened to Brandon Turner or anything that he says, he's always preaching, just get out there, get your first deal, you know, break the ice. And it's because he recognizes the value of that experience and that knowledge, and and it just gives you a different point of view, a more holistic point of view when you're going into your opportunities. It's okay if you don't have the experience right now at this point in time. What I'm trying to say is don't let yourself get stuck in the analysis phase throughout this kind of awkward market condition that we're facing with increasing interest rates and declining prices in some markets. What you really need to start focusing on is either building your plan or executing on the plan that you have been building if you haven't been executing yet. And if you're already out there executing, but you're kinda getting worried to go forward and continue to execute, really start looking at the plan you have and taking stock in what you've done in the past and what was successful for you, and then chart that course forward, because I assure you, now is still a good time to invest, there still are opportunities out there, and when you can't find those opportunities, it's time to start creating those opportunities. So I'll share what I've been doing and sharing my thought process with you, so maybe that helps, put some context around what I'm talking about. So as we've been walking through these choppy waters and and just watching inflation go up, and interest rates go up, I've really taken the time to look back on our business, and think about what has made us successful, and what is success to me. Because what success looked like three, four years ago, is not what success looks like for me going forward right now, because I'm a I'm a different person, I'm a different investor, I'm in a different position, and again, I have different experience and knowledge. For me, I've been spending time thinking about what increased my wealth the most and what created the most consistent ROI for me, and that was small multifamily.

Dan Austin: [4:13] We have a lot of experience in acquiring small multifamily, in stabilizing small multifamily, I'm talking duplexes, triplexes, quads, six eight, anything probably below 10 units. That is where either we've created a really good ROI, or we've stacked up some pretty good net worth increases. And that's what I wanna focus on, and so what I need to do to keep focusing on that is figure out how do I acquire those assets in today's market, because it's not going to be the same way that we acquired those assets two, three years ago. So what I've just explained to you is, in order for me to go forward, I looked back to see what was the most successful in alignment with my goals for the future, and then I pulled those things out, I'm stripping out some of those other items that we don't need to be doing anymore, and I'm focusing on how do I accomplish what I'm good at in today's market, and is it possible? And yes, I believe it's possible, and so now is the time where we can start crafting our marketing strategy, and start getting laser focused on how we're going to acquire those assets and continue to invest in real estate in a way that allows us to not just keep steady Eddie, but really accelerate our growth through these choppy waters while other people are choosing to get into that analysis process, why other people are choosing to sit on the sidelines and wait for something to happen, some wait for them to get kinda hit in the face with the perfect opportunity, which I can tell you is probably not gonna happen if you're not in the game.

Dan Austin: [5:46] You wanna win, you gotta play. If you're just starting out, and maybe you wanna flip a house, but you're unsure how to do it, you're getting all this conflicting advice on what to do. What I would do right now is I would look at what homes are selling in my market. Simply go to Zillow, see which ones had the least amount of days on market, look at the most recent comps, something that that is pending or sold this month. I would look at what's going on, what neighborhood's it in, what type of remodel was done, how clean is it, what are people desiring. Because I strongly believe you can still flip right now. You just have to rehab and sell a house that people want, and that's better than the one next door. Last year, you could throw anything on the market, and it would sell. And and some of this stuff was just flat out wrong. I'll be honest with you. Some of the stuff I saw people doing, it's gross, not good stuff, and people are still buying their house. So if that's the case and you wanna flip, go out there, find what's desirable. What I can promise you is desirable is probably going to be a little bit nicer and a little bit higher end than the house next door. So make your renovation budget so that you can do something higher end, make your offer price so that you can have a larger budget, and so that you have a little bit more margin in there on the back end of your deal, so that when you do go to sell it, you just have that cushion in case it has to sit on the market another thirty days, or you have to price drop $1,012,000 dollars or something like that. There's still strategy out there for you to flip houses.

Dan Austin: [7:10] You just have to build it, and then execute on it and stop letting the analysis paralysis beach up. If you wanna do buy and hold right now, and you're looking at a single family or a small multi, you really just need to pay attention to the interest rates. And here's what I strongly believe right now. If you can acquire a property, and you can rent it out, and you can have some cash flow, it doesn't have to be a lot, but it just needs to be good cash flow, you need that defensive metric, right, in case something happens that you need more money than your reserves can account for. Maybe it's $200. Maybe it's a $100 after all your set asides. If you can make that cash flow right now, you should absolutely hold that property and keep it because what's going to happen is interest rates, they're high now. And so if you can make a deal work right now, you'll be able to make it work in the future, because rents will go up, and then interest rates will start tapering down. I don't know when, I don't know how much, again, I don't have a crystal ball, but I do know that if you can make deals work in these high interest rate environments, there will be opportunities for you to refinance in the future and either pull out more money or have a vastly lower interest rate reducing your cash flow, or both. That's, like, the the best situation.

Dan Austin: [8:26] But my point being is there is opportunity for you to do buy and holds. Don't be afraid because of the high interest rates. Now I'm not saying sit on negative cash flow just because you wanna get a buy and hold, and I'm not saying lock up a pile of money just so you can have that little bit of defensive cash flow. What I'm saying is, can you effectively burrow a property that might not be perfect, maybe you do leave 5 or $10,000, and that's not a significant amount of money for you to leave in the deal, and maybe your cash flow isn't what you would love, but you can create that opportunity. For me, what I've got laser focused on is where I've been the most successful. Most successful for me wasn't necessarily flipping houses, and it wasn't necessarily holding single family homes, because those weren't in alignment with where I want to go in the future for my goals. What was was small multi family. I'm gonna be laser focused on that, and how do I acquire those throughout this choppy waters, throughout these weird times. And I will continue to buy, and I will be con continue to burn these properties and do whatever I can to acquire them as they fit into my goals and my strategy going forward. And just one last, like, little tidbit before we sign off here that I'm also doing is looking at where can I get more credit, more lines of credit, more money available to me so that I just have more options?

Dan Austin: [9:43] So looking at line of credits on my primary, looking at line of credits through, my bank where, where we do all of our loans, line of credits against our rental property portfolio, those sorts of things just so we have access to that credit in the event that we need it. Because what I do know, as as interest rates go up, lending's gonna get tough, and as as if the economy shifts in a certain direction, kind of more of a downward trend, financing isn't gonna be as easily as accessible as it has been in the past, so you just wanna have some of that, or at least we wanna have some of that temporary credit, some of that temporary quick cash that we can access right away to take advantage of, you know, overwhelmingly good opportunities when when they come up. All right, just to wrap it up, those are really just my thoughts on what I'm seeing on the headlines. Do not get an analysis paralysis by reading your Apple News and all the headlines that pop up on your phone every single morning. Really just craft a plan, and then just start executing a plan that will work for the next twelve to twenty four months. And I assure you, you will be a lot better off when you look back. Anyhow, if you liked this episode, please go out wherever you listen to your podcast, give us a five star review. If you don't have anything nice to say, don't say anything at all, but we would still like your five star review. If you wanna learn more about how and what Mike and I do in our business, you can always go to the instantinvestorprogram.com. It's our group coaching program where we teach folks to do exactly what we do in our business, and share our thoughts about our strategies and goals, and how we're going to build our business in the future.

Dan Austin: [11:17] If you like this as well, or you wanna hear different content or more content, or just have questions for me, hit me up on Instagram at investor man dan. Always love talking to folks, so definitely feel free to hit me up if you have some questions or wanna chat. Other than that, see you all next week.

Speaker 1: [11:33] 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.