The Riches are in the Niches

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.

Mike DeHaan: [0:28] What's going on, everybody? It's Mike DeHaan and Dan Austin here with episode seven of the collecting keys real estate investing podcast. We've had quite the week, Dan. I'm still still trying to play catch up a little bit from everything that's that's gone on. We're in we're in kind of a really interesting space in the business right now because I feel like, you know, as we as we do the marketing, it's always sort of like projecting out the opportunities that are gonna come in the future. But at the same time, when you're dropping 10 to $12,000 on marketing, you're just like, I hope it comes back. And then four weeks later, six weeks later, it's not quite coming back yet. And you're just like, well, guess I better keep spending this money. But then we're in this position right now where we dropped a huge amount of money in marketing, like August, September timeframe. And it's all come around. And each week, I'm always like, oh, we're starting to taper off a little bit. But then, know, this past week, we got, I guess, one or two confirmed signed deals. I guess we got we got two confirmed signed ones and we currently have four that are really strong potential, which might have actually been signed around, but our our acquisitions guy didn't do a CRM updates like he was supposed to. So it's highly possible that we have four signed contracts, and I just haven't heard about them yet. Wow.

Mike DeHaan: [1:45] So if that because that's the case, we got six more on top of our month where we just finished. We got, like, 12. Yeah. So that's just I mean, here's the crazy thing. Was looking at our numbers and I was like, okay. So from the whole year to October, I actually don't know the exact number, but we're at like basically, we've gotten two thirds of that number in, like, the last, like, six weeks. So we've almost equaled, like, our entire year's worth of contracts in the last couple of months.

Dan Austin: [2:17] Okay. Yeah. So say that again. So most of the year up until October, Yeah. Yeah. We're to now, which is, like, six weeks, we've actually almost meet that number.

Mike DeHaan: [2:26] We almost had the same number, almost the same. So we've almost, like, doubled Wow. Our our tally in the last six weeks. So

Dan Austin: [2:32] been a slow it's been a slow it seems like a slow growth, like, month over month. And then all of a sudden, like, just rocket ship, you know, because we had to figure some stuff out, like employee transitions and things like that. And then all of a sudden, it's just like the slow progression. And then now it's, like, straight up.

Mike DeHaan: [2:49] Yeah. Well I think there's a few things to that as well. Like, I've been trying to speculate why that is because, I mean, we're in the holiday season. Thanksgiving is next week. Christmas is coming up. Generally, like, starts to get a little bit slow. Right. But I think that I mean, one of the challenges over the spring and the summer was that, you know, the market was just a absolute rocket ship for everybody. And people were throwing up these shitbox houses all over the place and getting over, like, market value, like, retail value for a fixed up house for their major fixers on the MLS. And I feel like now a lot of the people that we're working with, they, like, probably were kinda waiting that out to sort of see what they could get for their house. And now they've waited too long because we have several properties too that got listed over the summer but didn't sell. Mhmm. And now we're buying them for significantly less than they were listed for. Because, like, basically, the the situation that people were trying to escape be that, you know, foreclosures or tax liens or whatever, they're all sort of coming to fruition now. They're starting to get penalized for them, especially since the moratoriums lifted lifted and the, you know, the city is now now pursuing people that have these tax issues.

Mike DeHaan: [4:06] So all of a sudden, like, these problems that people were able to either escape from with, you know, unhealthily hot real estate market, or due to the government restrictions on how to penalize people, all that's now gone.

Dan Austin: [4:23] Right. It's a

Mike DeHaan: [4:24] waterfall. Yeah, exactly. Right. And I think that just our consistent marketing, that's the other thing too, is a lot of these people that we've been getting these past couple of weeks, I was looking at numbers and most of them we've mailed like six or seven times. Right? And since you look at, since we mail every single person every single month, that means that we started hitting them like March or April, that could mean they were super hot. They've been receiving our stuff.

Dan Austin: [4:48] Yep. Yep.

Mike DeHaan: [4:49] And it's just like now it's at the tipping point for them they've realized that, you know, they've probably waited too long or they're unable to get out of the situation they've got themselves into. So it all just, but I mean, I think that's just the, it shows the importance of being consistent in your marketing. Right. And even going into the holidays, a lot of people they think, oh, the holidays are gonna be slow. Maybe we should slow down or do something like that. But it's like, no, you ramp it up, you know, because people are starting to like make year end decisions. Your competitors are maybe slowing down. And even if you have to do, like, the late closings, like we're doing stuff right now that isn't closing until January, which is out about six weeks. But, you know, then as soon as the new year turns around, that's almost a better place to be because you have some action happening right away.

Dan Austin: [5:35] Yeah. Yeah. It's like any other business, right, with marketing. Like, it's just consistency. And it is surprising how many people are not consistent with their marketing. Yeah. And even including us in the past, we've kind of been inconsistent on certain certain areas or changed things around. And now that we've been doing it pretty solidly this year, I would say, especially since, like, the springtime, it's paying dividends.

Mike DeHaan: [5:59] Yeah. Well, mean and and that that was an intentional decision we made, though. And even going to the meetup, a few weeks ago, that was kind of the biggest difference between those of us that had various, you know, deals being done on a regular clip versus those that had a lot more ebbs and flows was how consistent we are. And one of the reasons we were able to do that is because we have a team built out that's working everything. But even then, if you look back to, you know, March, April, May, we never quit marketing, I guess, like, April through July was kind of a weird period because, you know, we suddenly had a change of staff. We didn't have an acquisitions manager anymore. So we were working the leads, but we weren't quite like committing to them as much as we needed to. So we ended up with this backlog of stuff, you know, and honestly, we probably shouldn't have. But like, if you looked at it from a standpoint of, where our finances were, we shouldn't have necessarily been spending money on marketing. We made the decision to do that knowing that we were gonna be bringing on somebody else and we wanted them to be walking into a backlog of opportunity.

Dan Austin: [7:00] Right?

Mike DeHaan: [7:01] But I mean, because we were spending a lot of money with very little coming back in.

Dan Austin: [7:05] Yeah.

Mike DeHaan: [7:05] Just to keep that pipeline going. Right? And and not only like on a on a month to month basis, keeping the leads coming in, but also to with those same people keeping that brand awareness, where they're like, okay, so we have this branded piece of marketing that we got in, you know, March, April, May, June, July, August, September, and they have everything has a logo on it logo on it has our business on it, has our website on it. And eventually, they get enough of those and it stands out. Now when shit's starting to hit the fan, it's like, okay. I guess I better call these guys. They've mailed me eight times now. They are serious.

Dan Austin: [7:39] Yeah. Consistently not like the random ass. I don't wanna say any names, but I get them sometimes too. Like, every every sporadically throughout the year, they just show up my mailbox. I'm like, oh, good try. You know? But if you have that lot of these people are getting tons of mailers, but, yeah, which one has been here every single month? Because I'm gonna think that person wants to buy my house. Yeah. You know? Exact exactly. Yeah.

Mike DeHaan: [8:00] And then it will then happen, like, the follow-up process and everything else too once people come in. Because we've gotten a lot of people that called us over the summer, and we weren't able to get something figured out just because they were like, oh, the market's so hot right now. And now we have them under contract for some of them even less than we initially offered them. Wow. That's awesome. You know, because we've seen the turn in the market and we're like, well, it's getting a little scary now. Like, I don't really wanna be paying you that much anymore. And, you know, but they've they've just sort of seen the turn as well. But, yeah, it's it's interesting, interesting times with all that. But, you know, one of the things as well that as we've sort of started to dive into these different opportunities, I think has been a little bit different is analyzing like sort of like the different exits and strategies for handling a lot of these deals, which is sort of, I guess, maybe created more opportunities as well. So looking at things a little bit differently than we have in the past. Like right now, have a lease to own that we're sort of setting up where we're, you know, we have this property that has been kind of like a constant headache that we don't really want to be necessarily dealing with all the time. So we're selling it to one of the tenants on like a lease to own with like a five year option. And in doing so to secure that he's paying us basically the equivalent amount to all the money that we have tied up, plus his like his rent plus the other units ranks the duplex. In return, he gets to collect the other units rents.

Mike DeHaan: [9:26] His payment basically stays the same. But then with the structure, our cash flow stays the same. We pull all of our money, and we're no longer obligated to maintain the property. Because he I guess it's part of his contract. He has to. I mean, because if he doesn't, they'll fight us in the future.

Dan Austin: [9:41] And because we're still carrying our own note, we're still getting principal pay down on it.

Mike DeHaan: [9:45] Exactly. We're still getting principal pay down plus we're getting the tax advantages of owning it. But we're able to pull out all of our cash and maintain our cash flow and reduce our our effort. So we got that. And then we have some other ones that we are going to be closing on in the short term financing deal that we just got with these two funny little houses that, you know, as we look at them as like long term rentals, they don't really make sense for us. But it's like, well, we can sell those on like a lease to own to somebody that wants a home, you know, and basically needs to needs to get into a property is one to settle for like a smaller property. I I'm sure we can structure that to be making similar day if we rented them without having to deal with the headache of like, you know, maintaining those properties, which a, are outside of the zone of like everywhere else. So like it's super out of the way for us to manage. Mhmm. And then also to like the kind of people that would rent these properties might be a little bit of a headache. Yeah.

Dan Austin: [10:41] They're not like terrible properties. Like they're somewhat maintained in like some fashion. Right? But they so one of the one needs some they both need some capital work to make them really great, but they're so they're so small. It's like a bungalow and then like a, I mean, they're both bungalows really a one one and a two one, but it's a cool setup, honestly. And I mean, even there, there could be other access to like find another investor that wants that. Hey, I want two properties next door to each other. Perfect.

Mike DeHaan: [11:06] Yeah.

Dan Austin: [11:07] Right. But definitely being able to exit, you know, but maintain cash flow and get the equity difference that we're buying them at. Right? I mean, that's huge value add.

Mike DeHaan: [11:18] Well, exactly. And I mean, that is one of the things is if you're looking at those ones in particular from like a fix and flip standpoint, it's kinda difficult because those would be difficult properties to sell traditionally, especially with the amount of work needed. But we got those with the seller contracts, seller carry on them because they own them outright. So we're buying them for $210,000 market rates probably about 300 ish for these two little houses. I mean, both of for $2.10, you know, a $20,000 down payment. But then the key is we're getting out a fixed payment amount of $875 at 0% interest. Right? So that means that for every month that the tenants are paying us, I'm using that to pay off our our seller finance mortgage to these people. $875 of those going towards our bottom line when we go to exit from these properties. We go to pay off these people.

Dan Austin: [12:05] Yeah, which is awesome.

Mike DeHaan: [12:06] Which is awesome. So the total, you know, complete return, if you look at the cash flow potential, plus the principal pay down with no interest, plus the tax depreciation, plus the spread that we have on the equity when we bought it. I mean, even though like, that's a great thing about investing, especially the way that we do it, we're tough market. We take these janky little houses that wouldn't provide an opportunity to the average person, and we can make them a pretty badass investment opportunity.

Dan Austin: [12:31] Yeah. Yeah. I really like that. And and typically, I don't think about, like, like, everybody knows about your principal pay down, but, know, when you're looking at an investment from like an ROI standpoint, like you're not like factoring that necessarily into your numbers. You know, it's there, but it's kind of conservative to be like, that's that's just kind of the sugar on top because as the market changes, it goes up and down that that could the ROI with the principal pay down could could change. Right? Depending on your exit timing of your exit. But like this one, I think about it, $8.75 towards principal, you know, 0% interest. I'm like, in the way we're exiting on it, like that's $10,000 a year. Additional in cash flow. It's just going towards the the sellers. Right? So then when we do that full exit, it's like, say it's three, five years from now. I mean, that's $50 right there.

Mike DeHaan: [13:17] Yeah. I mean, more than that. So if, yeah, at five years, our balloon, it's just south of a $100. It's like $90 straight to principal. Because if you look at how a bank amortizes a loan over thirty years, they probably load the interest. Right?

Dan Austin: [13:29] Yep.

Mike DeHaan: [13:30] So, you know, if we if you had that on like a a bank loan, you know, the the first few years, it's going, like, 90% interest and, like, 10% principal. So, like, in the same situation, our interest would be, you know, like, let's say with a 75 payment, our our interest would probably be $800. Our principal will be $75.

Dan Austin: [13:48] Sure. Well, and just because I'm a a neurotic weirdo, like, don't front load the interest. It's just that three and a half percent of a larger number is a lot more interest than

Mike DeHaan: [13:58] That's true.

Dan Austin: [13:59] Than a lower number. Right? And so, I mean, just to be correct.

Mike DeHaan: [14:02] But yeah, that, that is true. But

Dan Austin: [14:04] everybody, everybody thinks that because that's what it feels like. Right? Like, yeah, the front, it is front loaded technically speaking in, which is good when you're the bank. Right. But it's really just because it's the bigger number times the percentage. Right. But, yeah, either way, it's badass to have a 0% interest loan with a cash with a cash flowing property. I mean, we could be those, we could be like, Hey, we're going to take the cash flow and just let these things ride. Right. And we're going to be making all this money. But from an exit for our management and our larger picture of where we wanna go, it makes more sense because it looks the same to us as renting it, but we're just gonna sell it in a non traditional way.

Mike DeHaan: [14:40] Yeah, definitely. But what and and those ones too kind of sparked an interesting conversation that I don't think a lot of investors look at. Because I I mean, I feel like most investors that we know, they either look at things from, like, an immediate return, like, they don't like looking to flip it, they're looking to wholesale it, they're looking, you know, at the immediate cash on cash. Or they look at things from like a super long term outlook. You know, I can't tell you how many people I've met that are like, they won't buy a property to keep if they're not interested in keeping it for thirty years. Yeah. You know, and just like, you know, it's kind of a weird place to be because you miss out on so many opportunities.

Dan Austin: [15:17] So that

Mike DeHaan: [15:18] sort of brought us to the conversation of like, okay, so we have all these properties that we've bought. I think, you know, joint, we're going to be up to 10 actual physical properties at 20 something doors just like that we share. Plus, you know, the stuff that we each own individually. And, you know, looking at things like, okay, what properties do we like as like legacy properties, right? That, know, we keep in the family, you know, you put in a trust, you give your kids whatever. And what properties are kind of like a, I don't know, seven to ten year play? What properties are like a one year play? And looking at the different, you know, potential return and what makes sense for those. Like whether that comes down to future maintenance issues that you see, future neighborhood growth that you see, just like this type of people that will be drawn to a property or neighborhood if that's worth dealing with for the long term. Because there's lots of properties out there that you can deal with them for a couple of years and, you know, it sucks, but you're gonna make, you know, 80% ROI or more than that. So, like, that's worth the time, but, you know, you don't necessarily wanna do that forever. You know, you don't want to pass off those headaches to your kids.

Dan Austin: [16:34] No. Yeah. And, like, I mean, if you're calling yourself like a real estate entrepreneur and you're not looking at ROI versus ROE versus your cash on cash, all the different metrics and then, like, optimizing them, you're really not an entrepreneur. You're just kind of, like buying properties. You're an investor. Right? And you're you're investing in a different strategy. Like we talked to a lot of guys and know a lot of guys that like, this is what they do full time, but they're not really thinking about that. They're just thinking about, well, if I accumulate these and pay them down and do this, this is how much it's worth. Like, that's great. But you are, like you said, you're missing out on a ton of opportunity. If you can reposition that equity into something bigger, something more optimized, maybe even too, like, that's the goal, right? Like build your base and then find things that are progressively easier continue to give you a fantastic return for your money.

Mike DeHaan: [17:18] Yeah, absolutely. And yeah, not feeling like everything needs to be forever or needs to be immediate. Yeah. Know, but yeah, it's, it's, it's a different, it's a different mindset. I think a big part of that too kind of comes from like a lot of the traditional media and coaching and things like that revolving real estate where they're like, you know, I'll find your niche and make that your, you know, what you're the best thing at. And I'm always kind of in the person that's like, well, sure, that's like, that's a good way to be really safe, I guess. I'm almost like, if you do like a bunch of stuff, like 75 or 80% as well as like the best person, you're still gonna do pretty freaking good and you're gonna have a lot of opportunities, You know? So like you look at look at our stuff, we have long term rentals. We have some short term rentals coming up. We do flips. We do wholesales. We have some things that we rent like to the state that are like, I don't know, they're not section eight. I don't know what you would necessarily call it.

Dan Austin: [18:11] They're part of the like, yeah, disabled. What is it called?

Mike DeHaan: [18:17] Yeah. Like people with disabilities.

Dan Austin: [18:20] Exactly. There you go. That are on state funded, state funded disabilities type things that are on, you know, long term disability and they're, they're disabled, developmentally Exactly.

Mike DeHaan: [18:28] But that's like a different structure with how you have to design the house and that sort of stuff. We're going to have some lease to owns coming up here. You know, now we're starting to get in those additions, like we're looking at potentially doing some like partner flips and like, you know, hard money sort of stuff where like we can profit on those other ends of the deals, you know, so we can still get the opportunity for like the, you know, the end position to be able to have necessarily put in the work for it. Like we have one that we're looking at right now with somebody who was like, hey, we'll front the down payment, You you front all the money for the rehab and you go ahead and fix it up and then like, we'll help guide that. We're not putting in any of the work and then we'll split the profits fifty fifty. Yep. You know, for like the newer investor that like doesn't necessarily have the wherewithal to get started or get a loan and we can facilitate that. So, you know, and those are all different niches, I guess, that people could like specialize in. But instead, I guess we have like 12 different niches. So we just create opportunities from different scenarios.

Dan Austin: [19:24] Yeah. Exactly. And like, I mean, I call them like, they're like arrows in your quiver. Right? And or different levers to pull depending on where you're at. And it's great to have multiple arrows in your quiver because that's how you can not miss opportunities. Right? Or it's like, hey, we're too maxed out on this. So let's see, we've got this new guy that wants some help getting into the business. So let's partner with him. He can do all the work and we're going to make, we're going to split the profits. Like, that's perfect for us. If we have too many flips going on, but we don't want to miss an opportunity or we'll just wholesale it off for, you know, half the profit. Right. So it's yeah. I like that.

Mike DeHaan: [19:57] Well, even then, right, that works out pretty well because we can sell it to him on wholesale fee and front load some of the money. We can carry the down payment amount. Right? And then he brings the rehab amount and then we split the exit, and you then helmet, you can list the property at the end. We can get a commission there too. Totally. So ultimately makes more money and then it gives him the opportunity to make some money while also getting introduction to the business at like potentially lower risk. Because I mean, worst case scenario, right, for us is he completely fucks us over. We have to go and pick up the project and do it anyway. It's like, that sucks, but we're at least in a position to do that. Yeah. And then for him, like, worst case scenario, I guess is I don't know. Like, he decides that he hates it and he wants out, but he can just walk away and then let's take it over anyway. He's not hiding over here. What do you do you

Dan Austin: [20:45] call it? Like, it's like you're limiting your risk. Right?

Mike DeHaan: [20:47] Yeah.

Dan Austin: [20:48] A lot of times when you partner, if you're doing it right, you're just you're limiting your risk to a certain amount because now you're splitting the effort, splitting the costs, splitting kind of the debt, all that sort of stuff. And so for a new person getting in the game, that's like a perfect opportunity, right? If you have experienced folks that are like, I'm willing to work with you and like folks like us, because like we have deals. It's like, Hey, I want to be in here. We get so many people on our buyers list, but they never pull the trigger. And then you get somebody like this guy who's like, I'm ready to pull the trigger. I just need some hand holding. Right? So it's like, yeah, partner. Perfect. Everybody wins. Or if you lose, everybody has like this limited backstop of loss, you know?

Mike DeHaan: [21:22] Yeah. Yeah. So Exactly. But yeah, it's interesting. You know, and I think it's good that we have those. I mean, it's funny as we have been going through a lot of this stuff, like especially these deals over this past week, we were just fricking slam trying to navigate all these and a lot of them are kind of interesting to ask some stuff with like land and these other kind of like more difficult deals. So our acquisition guys and our disposition guy have been working trying to like navigate them because they're a little less traditional. And it's kind of funny, Judd, our decisions manager called me the other day and he's like, Oh, yeah, I talked to like, you know, these multiple people. He's like, Yeah, they said they know you and they're like trying to, you know, like they want me to like vouch for him and all that sort of stuff. And he's like, you seem to like kind of know everyone in the community. He's like, how do I go and become like that person? I was sort of asking like some guidance. He's a younger guy. And I was like, it's funny because I wanted to say this because I've been in the community for a long time, but I really haven't. I've only been investing here since 2018, you know, only really been involved heavily in 2019.

Mike DeHaan: [22:28] But I was thinking like, you know, if anybody out there is like trying to get started and like building their reputation in the market, I think that everyone always thinks about, it's like, oh, you know, I need to know as many people as possible to get stuff done. And that's not true. What it comes down to is you need as many people to know you as possible. It doesn't matter how people know you, the more people the more more how many people you know, more people that know you, the more people will bring opportunities. Right. You know, and I think one of the best ways to do that is by either a, doing deals and like, you know, just jumping off the cliff and figuring it out, or b, getting into a situation where you are assisting with deals in like a very literal fashion. Whether that's like, you know, you're helping people flip their houses. You're like partnering on stuff. Because I think a lot of people, what they do is they try to network by going to these things and, like Mhmm. Just chatting with people is what I'm trying to do. I was like, but no one gives a shit about you. Yeah. You know, if you're not actually pulling the trigger, you know, no one no one wants to be involved with you at all.

Dan Austin: [23:33] Yep. So and I think one huge. Like, it's like I've you know, the people used to say, like, I don't know, like, what's your stack of HUD's look like? Right? Like, what have you done? Because we don't care if you're really cool guy or you got a lot of money or you got all these things, but if, like, you're not in that game where you're not helping produce, like, what value do you bring? Like, I see about, like, think about it, like for us on our list, like we've got tons of people on our list and how many people never bought a property from us. Right. And so if you're a new person and you want to get on that and you want to buy, like buy some shit, like buy something and close and be easy to work with. And all of a sudden you're be like, yeah, that guy's knows knows what he's doing. He's at least not an idiot. Right? He closed on a deal. Yeah. You know? And makes that wholesaler's life happy because he's able to get that off the books. I have to collect the fee and get out of there where sometimes it's a struggle. Right. But if you have a person, even if they're newbie and you're like, okay, well, if you're a newbie, I'm gonna make you jump through a few extra hoops because I wanna make sure you can close. But if you do exactly what they're asking me to do, like that's huge as far as credibility.

Mike DeHaan: [24:34] Yeah, exactly. And and, know, if you are in that situation, someone sends you a deal and you don't like that one, you know, at least make like a good offer or engage heavily for the next one to show that like just that particular deal wasn't for you. Because I mean, you know, I understand like you can do a situation wholesaler throws you like a crappy deal you don't like. Then you're like, you know, really goes south from there. But at the same time, we I mean, I get people like that all the time to reach out to me and they're like, hey, I'm really looking for the house. You know, I hear that you're kind of the guy to find stuff. Like what do you have anything coming up? And I'm like, actually, yeah, we have a single family right now. Great area in the South Hill, here's the asking price. And then, you know, send them photos and they'll never hear anything again. Like, just at least tell me why you don't like it. You know, the best way for me to never send you a deal is for me if you do not give me any feedback. Yeah. But also to buy it. Just say like, hey. I don't like this one because x y z. I don't care.

Dan Austin: [25:28] On the flip side, if it if it is a janky deal, the wholesaler knows that too. Like, if you can make some shit out of it, like, make money on it, like, you're gonna impress the dude. Right? Because, like, I would say

Mike DeHaan: [25:37] I know. Right?

Dan Austin: [25:38] Most of the deals that we take down, like, obviously, we get some sweetheart ones because we're spending all the money on marketing. And so we've got some pretty sweetheart deals that we just know from the beginning. Like, we're like, yeah. But like, there's a lot of them that were just like, man, I guess we're going to grind this out and make it work. Like, it's not going to be easy. Exactly. Right. And it's not sexy, but we've made a lot of money on not sexy properties.

Mike DeHaan: [26:00] I know that's like where most of the money comes from. And I mean, think I said, I think these people kind of wait for the lay down deals and then they complain there's no good opportunities out there. It's like, no. There are. It's just you gotta find them yourself because no one's gonna bring

Dan Austin: [26:11] it Yeah. To We're buying the lay down deals, dude. Right. Exactly.

Mike DeHaan: [26:16] I know. It's funny. I've had several people be like, yeah, like, I'm looking for this kind of flip. It's like, yeah, I've never seen you send me any like that. And I literally just say about them, like, yeah, Brooks, that's why I buy those ones, if I'm being honest with you. The ones that I'm sending out are the ones that either I don't have a financial capacity for, or there's like just enough work that I don't wanna commit for like four to six months to do it.

Dan Austin: [26:36] Right. Yep.

Mike DeHaan: [26:37] You know? And even then, if if it is like a a super easy deal that I don't have the money for, I'll figure it out.

Dan Austin: [26:43] Like,

Mike DeHaan: [26:44] I'll go borrow money from somebody else. I'll pull out some, you know, take a loan from something. I don't know, like my IRA or whatever. I'm not gonna do that yet, but I I would if I needed to to get the deal done.

Dan Austin: [26:56] Yep.

Mike DeHaan: [26:56] And yeah. I don't know. It's just it's just interesting.

Dan Austin: [26:59] It is.

Mike DeHaan: [27:01] So yeah. Anyway so yeah. So we got, yeah, a ton coming down. I mean, if we get these four locked up over the weekend, I think, actually, think James just texted me. I wonder asked him for an update. Yeah. He did. I'll read his text live on the thing.

Dan Austin: [27:20] Is there an eggplant emoji in there?

Mike DeHaan: [27:23] There is not. So he said one of them, it's he said it's done. They're just working on finding a place to go. Didn't hear back from two of the others, but is checking in. So I didn't get a full answer. Come on, James. Give me a full answer, man.

Dan Austin: [27:44] Right. He's beating around the bush.

Mike DeHaan: [27:46] He is. Yeah. Well, he's, you know, it's a weekend. He's been he's been working freaking hard, like, most weekends and getting after him. But that's that's the unfortunate thing with real estate too is, like, you gotta kinda work around the seller schedules

Dan Austin: [27:58] Yeah.

Mike DeHaan: [27:59] Which makes it challenging. But So

Dan Austin: [28:02] give me a quick, what rundown what what I needed to, prepare for in December. Where where are we going in the next three weeks as far as closings?

Mike DeHaan: [28:11] That that's a that's a valid thing. So we got, I guess, 10 in escrow right now. If we get these other four, that'll put us at 14. And those that'll be 12 closings in December that we have coming up. Most of which we're assigning, but we're buying we have that condo, that hoarder condo with all the pet waste in there.

Dan Austin: [28:36] Yep.

Mike DeHaan: [28:36] We're gonna have to be cleaning out. So that'll be a fun job. We gotta cut a bathroom into that basement and finish out that basement. But we're buying that one for 150. ARVs are at low 3 hundreds, like 300 to $3.15 range. Yep. Depending on the finishes, I imagine we'll be into a probably 60 to 70 to get it done. So it's a good spread. Yeah. Should make 50 to 60 on it.

Dan Austin: [28:58] That's a perfect example of a not sexy deal.

Mike DeHaan: [29:01] Totally. This house is so gross. And I mean, we sent that one out to to, like, our list and so little interest because the house is disgusting.

Dan Austin: [29:11] Well, and it's a condo sort of. It's like a duplex weird thing. It looks like I mean, it looks like shit. You gotta add a bathroom, but that's where you see the extra value. Like like we've, we've made a little bit of a niche profit area, which is like, I don't know, add a bedroom, a bathroom and so many people, which is funny because it's very common knowledge of like, that's how you can add values, adding square feet to your property.

Mike DeHaan: [29:33] Yeah. Yep. Okay. I know that that's kinda like our bread and butter. Yeah. So we got that to prepare for. We got the eight unit closing. I did I did hear back from our our loan rep that they should we had an issue with this where the seller classic off market seller didn't have their tax returns done for 2020 somehow, even though it is currently November 2020. Not only that, but they haven't even started working with our CPA to get their tax returns done.

Dan Austin: [30:00] It's not

Mike DeHaan: [30:01] gonna happen. We heard from our loan rep that that shouldn't matter. So we should be good there. We have the lease to own little ones that we're gonna be buying that we'll have to navigate. We need money for all of those. And then we potentially have this other flip on the South Hill that's kind of like a drug house, a squatter house that, like, as the people got kicked out, they, like, stole the furnace and the whole And water but the funny thing is if you look at the photos, the person that stole the furnace obviously knew what they were doing. Did a pretty good job. Like, it was a clean removal. It's probably some contractor who was there, you know, and his Oh, yeah. Weekly bender.

Dan Austin: [30:41] He's like, one of the HVAC guys I've hired before. And I'm like, what happened? Oh, it's because you stole that furnace out of your house. Yeah.

Mike DeHaan: [30:49] Yeah. So so we got those ones that we're buying. And then if we get some of these these other four under contract, we'll be at a you know, we got a duplex coming up out in the valley that's pretty turnkey. Or like to keep that one. And then we got a lay down, like, whole tail single family out in Coeur D'Alene that'll need some cash that'll be closed at the end of December. Then the rest of them shall be wholesales. So I guess what? Like, if I let's say if we get it to 14, that will be six that we're closing on. And Yeah. Yep. 8 that we're all saying, we need some money, dude.

Dan Austin: [31:25] Yeah. Money. Okay. We can find it, I think. I

Mike DeHaan: [31:28] hope. Yeah. I hope. If anyone wants to wants to invest some money, we'll give you favorable terms.

Dan Austin: [31:34] Right. Jesus. I'm just looking at it from hours invested in these things. What do I got going on? This is a good it's a good it's a good busy. Right? And so I'm kind of pumped for some of these to actually get under To get closed and start moving forward with them, start checking them off the list. The problem is, is like, once I clean that off, I know there's going to be like four more right, right in front of me, which is good.

Mike DeHaan: [31:55] Yeah, exactly. I mean, hope so. Right. But I bet that is, you know, as we as we go into the new year here, it'll be interesting to see how stuff goes because we have a ton of marketing going out. I think we'll kind of be at like a similar situation where, you know, hit in January, February, all that'll start hitting and hopefully it'll be a similar sort of situation of everything just taking off again as people are, you know, wanting to make their New Year's changes in their life, whatever that looks like.

Dan Austin: [32:20] Right. Get their gym memberships, sell their house. Exactly.

Mike DeHaan: [32:25] But yeah. Anyway, it's about time there. Yeah. Any good lessons learned this past week, Dan?

Dan Austin: [32:34] No. I I don't know. It's not a horror story, but it's just kind of funny I was thinking about because I felt like the, you know, this week, was just kind of grindy for me. So not a lot of, like, upsets or, or, wins or anything, but like, you know, haven't walked, I haven't walked an occupied property in a while, probably since the summer. So it was kind of fun getting out and walk. Yeah, I don't think, I mean, I've walked kind of like, I think Fredrick is probably the last one where it was like the people are still in there with, you know, whole situation, which was odd and the 40 birds that they had in there. So it's good to get out. And the little, these little bungalows we walked, which weren't bad. And I, I just walked in that one room and you were out talking to the owner and I was in there just for a while, just admiring. This thing was, that was crazy. It was like a, a gypsies, like little, wagon. Like they would have all these things. I mean, every inch of that place was covered. Then I noticed like four torches and a and a burnt spoon. I was like, oh, okay. Yeah. Haven't seen heroin heroin's bedroom in a while. Heroin addict. So that was kind of fun. It's just the little shit you run into that you just kind of laugh about.

Mike DeHaan: [33:36] I know.

Dan Austin: [33:37] It looks like scary in there. Like, I I don't wanna stay the night in that room.

Mike DeHaan: [33:40] Yeah. Yeah. Know. It's it's always super fascinating. Yeah. Getting into these, you know, that as one if you're like a nosy person, this is definitely in the business for you because you get so many people's dirty laundry. Like Yes. You see some weird weird stuff. Yeah. Know, you get so involved in their personal lives and,

Dan Austin: [33:59] you know, can weird. So, you know, you you walk around town and you see someone and you're like, oh, you know, they're not like not like the tweaker, like homeless people, but like the people that you might bump into in like a, like, low quality grocery store. And you're like, bet they do drugs. And then like, I saw the pictures of these people and I

Mike DeHaan: [34:16] was like, oh, those are the kinds

Dan Austin: [34:17] of people you see at Walmart. So I bet they do drugs. And then lo and behold, they do. And so it's like, putting, you're actually connecting your intuition, those dots together as you're walking through these people's houses. It's just like,

Mike DeHaan: [34:26] oh my god. Well, I mean, I think there's a lot to be said that, you know, your first instinct about how to react to an individual, if they seem like, I don't know, a little bit out of your, like, the zone you're comfortable with, like, listen to your gut because it's probably right. Yeah. Exactly. We've seen the inside of their houses. It's very probably right.

Dan Austin: [34:46] It's very accurate. I use listen to your gut. That's a good lesson learned. Listen to your gut.

Mike DeHaan: [34:52] Yeah. Seriously. Alright, guys. Well, thanks for listening. You can follow us on Instagram and Facebook at collecting keys podcast. You can follow me directly at mike underscore invests. You can follow Dan at investor man Dan, both of us on Instagram. Go ahead and give us a follow, which is DM. Like and subscribe to us wherever you listen to your podcasts. And actually, it would be a real help is if you enjoy this, share it with somebody else that you think might enjoy it as well. Some casual real estate talk for thirty minutes a week. And website coming soon at collectingkeyspodcast.com. Anything else, Dan?

Dan Austin: [35:31] Trust your gut, people. Trust your

Mike DeHaan: [35:34] people. Alright. Awesome. Thanks, everybody. See you next week.

Dan Austin: [35:37] See y'all.

Speaker 1: [35:39] 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.