March 4, 2025 • 39 mins
Dave Zouski shares his real estate journey, emphasizing strategic investing and the importance of relationships in navigating the market. His insights on the buy-and-hold strategy, effective contractor management, and the significance of networking provide valuable guidance for both new and seasoned investors.
• Highlighting the transition from agent to investor
• Emphasizing the need for strong banking relationships
• Discussing the advantages of a buy-and-hold strategy
• Sharing lessons learned from contractor management
• Exploring the importance of consulting with tax professionals
• Encouraging the building of a supportive investment community
If you're new to real estate investing and need some help, reach out at wisconsindiscountproperties.com!
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Transcript
Episode Transcript
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Speaker 1 (00:02):
Welcome back everybody to another episode of
Wisconsin Investor Podcast.
I'm your host, Corey Raymond.
I'm super excited to get intothis episode today, but before I
do I want to talk aboutWisconsin Discount Properties,
who sponsors the podcast, andI'm going to share a little deal
with you guys, like I've beendoing the last few weeks.
If you've been tuning in thisone that we had we just had out
to our buyers list, it was inClintonville, wisconsin.
(00:22):
So if you're not familiar withthat, that's a little bit west
of Green Bay, a nice littlesmall town area 99.9,.
We had it out to our buyerslist for single family house
four bed, one and a half bathand the ARV on this thing was
200K.
Would have worked really wellwith hard money lending.
So a lot of hard money lenderswill lend 65% of that after
(00:44):
repair value.
So you could have got thepurchase price plus a good chunk
of any kind of rehab budgetbaked right into that loan from
your hard money lender and hadenough spread there to make a
few bucks with having hopefullylittle to none of your own money
into a deal like that.
So there's deals like thatevery single week.
We're putting out two to fivedeals a week to our buyers list.
It's all off market stuff.
You got to be on the buyerslist to be able to get access to
(01:05):
these.
So if you want to get access tothem, you go to
wisconsindiscountpropertiescom,plug your information in and
you'll start getting instantaccess to the deals every single
week in your inbox and on yourtexts.
That being said, let's dive intotoday's episode.
I got my good buddy, dave ZeusZowski, with us.
What's up, dave?
I'm on.
How are you doing?
I'm doing good man.
So those of you guys on YouTube, you can see Dave is freezing
(01:27):
his buns off in his vehicleright now working on a property
there.
It is All right, yeah.
So if you guys want to pop overto YouTube see what he's got
going on.
But Dave, I've known Dave nowfor several years.
He's been a force in the realestate world here in Northeast
Wisconsin, him and his wifeWanda.
We had a mastermind a few yearsago.
They were part of thatmastermind and they've done
really, really well over thelast few years and flips and
(01:49):
rentals and everything else.
But, dave, tell us a little bitabout how you guys got into
this.
What does the business looklike today?
And start there.
Speaker 2 (01:57):
Sure, we got into it.
I got into real estate salesjust as an agent back in 2017,
working for expert real estatepartners, did real good for the
first couple of years as anagent and then just kind of
realized that there was moremoney in buying my own and
holding my own and flipping thanthere is in helping sell other
people's stuff, so kind of gotstarted I think it was 20.
(02:21):
Well, it's been 2019.
We bought our first propertybecause it was right when right
when COVID started Okay, becausethat one we were working on,
that one when everything justwent haywire.
Okay, still hold that propertytoday.
It's actually one of our reallygood cash flowing properties,
nice, yeah.
And then kind of just actuallythen about 2021 or 22, I think,
(02:42):
my wife Wanda, she got into it.
She got her real estate license, quit her W-2 job and we've
just been rocking full-time inthe investing and real estate
basically real estate agent.
Speaker 1 (02:53):
Nice, nice.
So yeah, you're pretty muchevery day you're talking or
working on houses or propertiesall day, every day right, I mean
, you're fully engulfed in itall the time.
Yes and last.
Speaker 2 (03:04):
And uh, last well, this last year I went and got my
GC license, so generalcontractor, so I can do, I, we
do a lot of our own work.
We don't really hire a wholelot of stuff out, so we
typically only like to work onone or two properties at a time,
just because we don't have thetime to, you know, to get into
it.
You know other properties andyou know one or two at a time is
plenty for us, for sure, forsure.
Speaker 1 (03:25):
How many, how many flips and that sort of thing
have you guys done since you got?
Speaker 2 (03:30):
started.
I would say maybe flip and sell.
I would say maybe 20, 30 thatwe've, that we've actually
flipped and sold and we I meanwe kind of go back and forth.
We were up to about 30 rentalproperties and then we sold a
bunch so and then bought somemore.
I think we're back up to 22 or23 right now, still looking to
(03:53):
add more.
We kind of we kind of wentthrough our portfolio and found
the ones that really weren'tcash flowing, that we had some
equity in, and dump those so wecould take the equity and go use
it someplace else.
So we kind of just kind ofskimmed some of the you know the
crappy ones off the top andthen kept the better ones.
Speaker 1 (04:09):
Yep, I did a little bit of that this year too and
and uh, worked out pretty well.
So I like that straight.
A little recapitalization, ifyou will.
Yeah, yeah, very nice.
What?
Let's go to that.
Back to the start, dave.
So what was the biggeststruggle that you had getting
into real estate, or maybe likeknowing what you know now, what
would you do differently if youhad to go restart this whole
journey, this whole crazy life?
Speaker 2 (04:31):
Well, one thing that I'm learning now that I know I
wish I would have just pickedone bank and just worked with
one bank, Because right now I'mtrying to figure out a bank
that'll.
I think I have a shadow on meor something here.
Yeah, that's okay's kind offunny, but so, yeah, if we just
had one bank that we worked withall the time and we had all of
(04:51):
our mortgages and all of ourproperties through, we'd have a
heck of a lot better idea ofwhat we're able to do right now,
because we have a little over amillion dollars in equity in
all of our properties, butthey're all spread out.
There's three or four at onebank, three or four at another
bank, and then nobody will giveyou a line of credit on your
properties if they don't holdthe first mortgage.
(05:12):
So that's one thing I wouldstress to people is find a good
bank that you want to work withand have a relationship with and
stick with them.
Speaker 1 (05:21):
Yeah, that is a bit of a pickle.
Now has been dave a couplebanks that we found recently
that are offering helox assecond position on on um
properties they do not hold thefirst position on.
So it's kind of a development.
In fact, I just interviewedsomebody the other day it'll
probably come out a couple weeksbefore yours, so, uh, if you
(05:42):
want to listen to that one but Idid brandon and kayla farley,
and they were talking about howthe uh banker at nicolet bank of
all banks gave them a heloc ona property that nicolet bank did
not have the first position onno, that's weird because I know,
yeah, we have our our proper uhmain residence that we live in.
Speaker 2 (06:01):
We have that through nicolet bank and we did we were
able to do a heloc on that one,but they wouldn't touch anything
else so interesting.
Speaker 1 (06:08):
Yeah, community banks are just so interesting because
it's it's very relationshipbased.
It's very much like whateverkind of seems like, whatever the
flavor of the week is for themthat they want to do, yeah, and
then when they fill that bucketof, okay, we've got enough lent
out over here, then they justcut that program off and you got
to go find another one.
And that's kind of what we'veshown.
We work with a lot of differentbanks so we have a little
(06:29):
different strategy.
But it's because a lot of timeswe've had they've had like a
great program and we've been weutilize the crap out of it and
then they shut it off and sayall right we got to go find
somebody else now who can, whocan do something else with it.
But I like your idea, I likeyour point.
It makes a lot of sense becausethen you can leverage all that
equity that you build over timeto go parlay those HELOCs into
(06:49):
what you want to do with it.
Speaker 2 (06:51):
Yeah, like I said, when you're sitting on a million
dollars in equity that youcan't use it kind of sucks
because I wouldn't need a hardmoney lender or a bank or
anything to really go buyanother property or do a flip.
I could just do it all in myown pocket and then, you know,
not have to pay all thatinterest.
Speaker 1 (07:04):
So yeah, for sure, what have been the?
You know in the mastermind wealways thought we talked about
needle movers.
You know, when we, when we hadyou guys in there, we did an
exercise figuring out one of thebiggest needle movers, what
about for you and wanda, like,what have?
What have been some of thebiggest needle movers for you
guys are the things that havemade the biggest difference?
Do you think in your guys'ssuccess in in doing this
business?
Speaker 2 (07:22):
I think we had a lady that was doing our taxes the
last couple of years and shereally I don't want to say, but
she really didn't do a very goodjob and last year we ended up
having to pay a lot of moneythat we didn't have.
So finding a good tax personbecause that took a lot of time
(07:44):
to we didn't have.
So finding a good tax personbecause that took a lot of time
to get all that straightened outand that put Wanda at the table
working on the computer, I meanfor hours and hours and hours
and finally trying to get allthat figured out.
So I would say, now that we gotthat figured out, that freed up
a lot more time for us to goand do what we should be doing,
(08:04):
what's making us money.
And then kind of realizing, youknow, when we do the flips that
there's a lot of tax money thatcomes out of that.
We usually always try to putaway for that you know we always
we're always real good aboutdoing that.
And then you know, kind ofthat's kind of another reason
why we're wanting to get awayfrom actually doing the flips
and selling and just buying andholding them more and just doing
(08:24):
a cash out refi when we get itdone, because then all that
money is tax-free anyway.
You don't have to worry aboutthat.
Speaker 1 (08:30):
Yeah, there's a couple of things that go back to
this for the audience.
Maybe some of that went overtheir head.
Like what Dave's talking about.
When you refinance a property,if you pull some equity out of
it, in that moment it'sconsidered loan proceeds, not
income, so you don't have to paytax on that money, at least
until you sell it.
At some point You'll have topay some tax on it, but in the
moment it's tax-free.
(08:51):
So now you can take that casheither, use it to live off of if
you want, if that's like yourquote-unquote income, instead of
flipping.
You're kind of flipping toyourself, but tax-free.
So you basically are givingyourself what a 20% raise just
by yourself, right, yeah?
Speaker 2 (09:10):
I mean, let's say we literally just got done refining
out of one.
It was a property that webought for like 120, I think,
and we stuck barely anything I'dsay maybe eight grand into it,
wow and then turned around andgot it rented out.
I think we got it rented outfor it's a single family house.
We got it rented out for.
I think we got it rented outfor it's a single family house.
We got it rented out for like$1,550 a month and the payment
on it is $1,350.
So cash flow is $200 a monthand I mean that's everything,
(09:34):
that's all included, because weinclude water and all that stuff
.
So you know, average cash flowis probably $150 to $200 on it
and I think we cashed out justshy of $30,000 on the refi
non-taxable.
Speaker 1 (09:49):
I mean I'll do those deals all day long if I can,
absolutely Well.
And then what's great is yourtenants are now paying down that
new debt for you again.
They started the clock over andnow five, 10 years, you've got
another possible refiopportunity pull more capital
back out again.
And I was just talking to ZachMorgan on the podcast before
this that's going to come outprobably the week before you,
and we had the same discussionof, like you know, he was
sharing an example similar tothat and we just did the math.
(10:11):
I said how long have you ownedit?
And you know it was 60,000bucks and he owned it for four
years.
And I said, well, divide 60 byfour.
And now think about that.
Divide each of those by 12.
Each of those by 12, that'syour monthly cashflow.
Even if you made zero quote,unquote cashflow, no money went
in your bank account every year.
You just put 60 grand in yourpocket, tax-free.
I mean, that's your cashflowover the years.
(10:32):
So buy and hold strategy it'stough to beat and it sounds like
you guys are going that way.
Is it because of the taximplications of the flips or
what's the reason you guys aremaking that shift?
Speaker 2 (10:45):
because of the tax implications of the flips or
what's the reason you guys aremaking that shift?
That's probably.
That's probably one of thereasons is just the taxes.
But the other reason is justbecause I like having the
appreciation too.
I mean you know what thosehouses are going to be worth in
the next 10 to 15 years.
As long as everything keepsgoing up, or even if it goes
down, it's going to come backout of it eventually.
So if you can hold on to them,even if it goes down into a turn
(11:07):
, if you can hold on to themthrough the downtimes, you know
you're going to come out evenbetter in the in the long run,
so sure.
Speaker 1 (11:13):
Well, and you look at like interest rates right now.
People complain about theinterest rates right now, even
if they went back up again, uh,in three to five years, when the
interest rates, hopefully, areback into the fives, maybe, if
low fives.
Now you refinance Now thosethings.
Now you look like a genius,right, so you break even for a
few years on cashflow, butyou're building equity, the
thing's appreciating.
You're getting debt paid on,you're getting tax benefits,
(11:35):
right, and now when yourefinance it in a few years, you
can pull some cash back out.
And now you're maybe going tolower, even lower, your payment
at that time.
And now you look like a geniusbecause your cashflow and big
money and rents typicallyappreciate as well, so they're
typically going to go up overtime too.
Well, that's exciting, man.
So do you guys have a big goalas far as, like, how many rental
units you're trying to get to,or a certain cashflow number, or
(11:57):
a certain equity number?
Are you just going to keepplugging away?
Speaker 2 (12:05):
And just probably just keep on going until we
don't have to anymore.
Okay, very cool.
I don't know, I don't see usstopping anytime soon.
Speaker 1 (12:08):
So yeah, what about?
Speaker 2 (12:09):
like I always put a goal on it.
I always say I want to get to50 by the end of the year, and
then that never happens, andthen you know, so it's like I
kind of just kind of just fly bythe seat of our pants.
Speaker 1 (12:18):
Just just do a couple , keep it going and then get a
couple more and as they come.
Speaker 2 (12:22):
Yeah, very cool, yeah , I think actually last year we
only did the last two years.
We only did one flip and sell apiece, you know each year, and
then the rest of them, we all,we kept everything so nice very
cool, very cool.
Speaker 1 (12:33):
Uh, the bookkeeping thing.
I want to go back to that.
You know, this was somethingone of our mentors told us right
out of the gates, like we'donly done a handful of deals and
we had this guy that wasmentoring us and I mean he was
amazing and he's like get a goodbookkeeper and a good real
estate specific accountant rightnow.
And we're like, well, we're noteven doing that much.
He's like, yeah, but you wantto, right?
And I'm like, yeah, he'sactually set it up now and
(12:53):
you'll thank us later.
And good Lord, you're right,cause I hate, I hate doing
bookkeeping.
Like, yeah, I don't havepatience for it, I want to go do
deals.
Speaker 2 (13:02):
Yeah, yeah, and I don't, I don't either, and
that's, that's where.
That's where Wanda, she does alot of that?
Speaker 1 (13:07):
Yeah for sure.
So those of you guys listeningout there, if you're just
starting out, get yourself agood bookkeeper, get connected
with a good real estate specificaccountant.
Even if you don't think you'reworthy of it at this, you're
going to go Right, exactly, yeah, very good, very good.
What has been like?
Let's talk about some deals.
Let's go into some deal.
(13:27):
Talk, dave, talk about like,what's the like, the biggest
rehab you guys have ever had todo?
Do you have you got?
Do you have you guys had onewhere you've had like a monster,
you know, ended up being a bigbear, and how did it work out?
Speaker 2 (13:41):
Well, I could go a couple of ways.
I could go the one that we lostour ass on.
Speaker 1 (13:46):
Well, yeah, let's talk about it, Cause I think you
want to talk about a bad one.
Speaker 2 (13:50):
I was talking to I was talking to Dwayne this
morning.
I mean I told him that I wascoming on this with you and you
were talking about it, and Isaid I'm like I should probably
just do a podcast of all thestuff that I screwed up, because
I think I messed up just abouteverything.
Hey, that's perfect.
But we bought a house.
It was actually a friend ofmine from high school it was her
grandmother's house Went into ahome.
We went down and bought it.
(14:11):
It was a huge, huge house, hugeold house, built in the 1800s
Old farmhouse.
It was like seven bedrooms, onebathroom.
Oh yeah, oh yeah.
So we at least we, you know, werearranged a bunch of walls and
did everything and I think weended up turning it into a five
bed, two bathroom, okay, andadded like a nice dining area
and all that.
I mean it was it ended up beingreally nice.
(14:32):
We ended up sticking about 130000 into it.
Wow, bought it for, bought itfor 70.
We used I think we used Tonyfor hard money.
Speaker 1 (14:42):
Bought it for 70.
Tony is a owner of good faithfunding.
He has a hard money lendingcompany and if you go back I
think he's like episode five orsomething like that, and then
his partner, jairus, is onanother episode as well.
But anyway, go ahead.
Speaker 2 (14:56):
Awesome guys to work with.
But yeah, so we use them andstuck like $130,000 into it,
figuring that it would be worthabout $250,000 when we're all
done.
So we're like, all right, we'llstill make about $50,000, you
know, after closing costs andall that, you know, even if we
make $30,000.
And it was a property that wedidn't actually do any of the
work.
We contracted everything out.
(15:17):
So again, it was one of thosedeals that just popped up and
was like, yep, I'll take it,we'll have this other, we'll
have our contractor do it andtake the whole thing.
So that way, we didn't, youknow.
So it's like, okay, we'll make$30,000 without having to do
anything, I'm okay with that.
And sat on the market.
Sat on the market, sat on themarket, couldn't sell it,
couldn't sell it, ended upselling it for $200,000.
(15:38):
Thousand dollars.
So after we were you know allthe interest and everything we
were we were behind about 30grand on it.
Wow.
So, yeah, that was that was thebiggest hit we had we had to
take.
But ouch, um.
So yeah, that was that was ourworst, worst deal ever okay.
Speaker 1 (15:55):
Okay, what was the?
What do you think went wrongwith that deal?
Let's talk to that.
Did it?
Was it an underwriting?
Speaker 2 (15:59):
well, my contractor told me that contractor told me
he was going to get it done inthree months and the other thing
was, you know, and it took himsix months.
So then we were already behindby the time we got it sold, we
were already into it seven,eight months, I think.
So then you're paying extrainterest and all the extra
closing or holding cost and thenit's just the arv.
(16:22):
Like I said, I figured a fivebed, two bath house.
I mean, even if it was an omro,it was sitting on a double lot.
I mean it was a big, huge lotwith an extra garage.
I figured it was 250 all daylong after.
But that, uh, yeah, that was adifferent, whole different area
down there, which is funnybecause it's where I'm from, I
grew up there.
So, okay, I kind of figured Iwas like, well, I know this town
(16:42):
, this town, I could sell thisfor 250 down there Didn't work
out.
Speaker 1 (16:47):
That's so good.
Well, so there's a lot oflessons in that right
Contractor-wise, what they tellyou, three months budget for six
, double whatever they tell youfor a timeline have you ever had
experience?
So you guys have worked withcontractors before.
Now you're doing your own thing.
But working with contractors,dave, now, as a contractor, what
are some things like investorsshould be doing to have a
(17:08):
successful relationship with acontractor?
Make sure that that contractoris you know, a the contractors
make money, but B there has tobe a good symbiotic relationship
there.
So, like what are some thingsyou see?
Speaker 2 (17:24):
there.
So like what are some things,you see?
Yeah, I mean I mean we still soI still contract out like
windows, roofs, siding, likepretty much all the exterior
stuff.
I don't like doing any exteriorstuff, we pretty much just do
the interior.
And I mean we got a goodrelationship with our
contractors that we use for allof those.
So I mean, and and this onewasn't he?
He kind of just he would starton the project and then all of a
sudden, well, something elsepopped up.
(17:45):
I got to run over here and justdo this for a couple of days,
and so he was constantly backand forth, you know, and you
kind of just had you just got tostay on them.
And I mean that has that's kindof been my issue with other
contractors.
That's kind of why I went andjust got my GC license, just so
I could just I don't have todeal with it anymore.
Speaker 1 (17:59):
That's why I can pull the permits you got to talk to
about this.
Speaker 2 (18:04):
You know, I can pull the permits, I can do whatever I
need to do and then I can getthe subcontractors in and, you
know, make sure they're they'rerolling.
That's actually pretty muchwhat I'm doing right now.
I'm not this.
This house that I'm working onright now is taking over the
contracting for him because he'sgot a couple other ones going
on.
So I just took over this oneand basically just doing some
(18:26):
work.
We're doing a bunch of framingand stuff and then we're hiring
out the drywalling and theplastering and the painting and
all the other stuff.
So I'm just kind of doing that.
You just got to kind of keepeverything on a timeline.
Speaker 1 (18:37):
So you're almost more like project managing besides
the carpeting stuff.
Speaker 2 (18:40):
Yeah, this one.
Speaker 1 (18:41):
Okay, cool yeah.
So somebody else could do thatwithout a license, a GC license
if it's their own property rightYep.
Speaker 2 (18:48):
Yeah, yeah, as long as somebody.
You know.
If you have to pull a permitLike this one, we had to have
the whole foundation excavatedand everything.
Speaker 1 (18:58):
So there was no way to get away without doing
anything without permits.
So you know he had to havesomebody be able to pull the
permits.
Okay, got it, cool.
So if you're doing it byyourself, like, say, dave, you
weren't licensed and you werejust going to be doing work,
you're on everything you'regoing to do by yourself, are you
still required to pull permitsand do you need a GC for that?
Or can you pull a permitwithout being a GC if it's your
own property?
Speaker 2 (19:16):
If you're the homeowner and you're going to
live there and you're livingthere, you don't, you can pull
the permits.
But if it's not your primaryresidence, then you need to have
a GC, a licensed GC pull thepermits, you can tell how many
properties I physically getinvolved with Asking these
questions.
Speaker 1 (19:32):
I legit didn't know that that's good.
So so more tips.
Give me some more tips ofworking with contractors, Cause
this is a big pain point for alot of people out there Like so
you some more tips of workingwith contractors, because this
is a big pain point for a lot ofpeople out there like so
staying on their butts.
But is there anything you guysdo on the front end as far as
like contractually, to make surethey're like?
Is there anything you can putin as far as like we're gonna
like?
I've heard other people do thisin the past years ago.
(19:53):
I feel like it's less and lessnow because contractors are in
such demand but used to be likein your contract you could put
some kind of penalty if they'renot done by a certain day, or
something like that.
Like, is there anything likethat that you're doing now or
any other?
Speaker 2 (20:05):
No, we, we had talked about it but we never, never
implemented anything, cause,like I said, we only ever had
somebody take a, take a flip anddo twice that we didn't touch
that.
We had somebody else completelydo all the work.
So I mean, we're pretty muchstaying on.
You know, I'm at the houseevery day, wanda's at the house
almost every day when shedoesn't have the book work to do
(20:26):
.
So I mean, we're, we're workingthere and, you know, making
sure everything is moving along.
If that's not what you wanted todo, then yeah, then I mean,
there's some, there's probablyyou know some wordage that you
could put into the contract thatyou need to.
You know you need to be done bythis date or give at least
progress updates by each.
You know, each time, each timeyou get to a certain step, you
(20:46):
know, like the framing's done.
Okay, I want the framing doneby this date, and then I'll
check it out and then then I'llrelease part of part of the
money that I owe you, and thenyou go on to the next one.
I want, you know, but it shouldbe painted by such and such
date, and then if it getspainted by that date, then I'll
give you that much money, okay,and kind of put it in like a
draw system, just like it iswhen you're building a house Yep
, okay.
Speaker 1 (21:07):
Good stuff.
Yeah, I think that's probablyone of the biggest pain points
is like people are like oh cool,I got somebody that'll do the
work.
Great, here's the project,here's what I want it to look
like.
And then they come back andthey're like nothing's been done
here, right, yeah.
So I think having those upfrontconversations, it sounds like,
is really important to yourcontractors too, and just having
clear expectations and ideallywritten out, uh, signed and
(21:29):
agreed on by both parties yeah,that's good.
Speaker 2 (21:32):
Yeah, the other thing I would say is make sure you
price check everybody.
Yeah, we kind of we kind of gotwe with our one, our first
electrician that we ever usedlike we just kind of got used to
him and was like, okay, we gotanother project, just come get
it done.
And he went you know, it'smostly time and materials and
and stuff like that and then allof a sudden like, oh yeah,
it'll be thirteen thousanddollars, okay.
Well, then the next hoursuddenly he sends me the bill
(21:54):
for like seventeen thousanddollars without saying a word,
like there was no talk, noconversation.
I was like, uh, what's this for?
And you know I still couldn'tget a hold of him, he wouldn't
explain it.
So I ended up just biting thebullet, paying him and then
found a couple more electricians.
So now, now we kind of you knowwe'll bring two or three in at
a time and then get bits on them, and you know, obviously most
(22:15):
of the time they're they'repretty, pretty close to each
other, pretty competitive, andyou know you kind of pick the
one that you work with the best.
But yeah, we got a pretty goodelectrician now and a pretty
good plumber, that now I reallydon't have to price check them
too much anymore because we'vedone enough of them.
Like, yeah, I kind of have agood idea of what the what the
plumbing cost is going to be andwhat the electrical cost is
going to be, before I evenbefore I even bring them in, and
(22:38):
so, yeah, well, that's a greatlittle nugget there for the
audience there guys.
Speaker 1 (22:40):
So listen back to that.
Dave was just talking aboutwhen you're getting going or
you're trying to figure out yourteam.
You got to bring a couple ofpeople in and get some
competitive bids on this stuff,on these projects.
Let's talk about timelines,dave, because I think you're in
a unique position, being inswinging hammers and doing
things and coordinating yourpeople.
When you guys go and you get aproperty, like you put an offer
(23:02):
in, you get accepted, what doesit look like between, like that
date of when you get it acceptedand when you finish the project
and you list it and list it andnow it's being sold?
Are you guys doing a lot ofstuff prior to closing besides
getting lending and that kind ofstuff?
As far as lining people up, isit start the day it closes.
Speaker 2 (23:21):
Then you start going like tell everybody a little bit
about your guy's system andprocess.
Sure, it's efficient.
So, yeah, I mean usually, likeyou know, if we're able to walk
the property and kind of get anidea of you know what we're all
going to need.
First, once we get an acceptedoffer, I'll let you know, my
plumber know, I'll let myelectrician know, if I need a
roof, I'll let my roofer knowthat you, because a lot, of, a
lot of the roofers can go offlike Google maps or they have
(23:41):
like a bird's eye app orwhatever that they can use, so
they don't even need to go tothe property, they can just look
it up, so they can give you a,they can start giving you quotes
before we even close on it.
And then that way, when, thatway, with the day we close, we
go in there, we do the clean out, we do the demo, we do
everything that we need to do,you know, get the permits pulled
and then and then bringeverybody in and we kind of have
everything.
(24:02):
We like to have everything kindof lined up before we even
close on it.
At least give the, at leastgive the subcontractors heads up
like, hey, I got this property.
When we close, you know it'llbe a couple of days after that.
Speaker 1 (24:13):
I'm going to need you , so you know, kind of give them
a heads up.
Cool, is that something you'vealways done, or is that
something you kind of figuredout once?
Speaker 2 (24:19):
you got some.
We just kind of figured outbecause you know, all of a
sudden you know you close on aproperty and you're ready for
the rough and plumbing andelectrical and they're like,
well, we're two weeks out, wecan't get to you for two weeks.
So this way, if you give them alittle bit of heads up, then
they can at least put you on acalendar for, you know, a
tentative date, private money orsomething where you're paying
high interest rate, like thelonger that baby sits, like your
seven month project.
Speaker 1 (24:44):
All your profit goes to the lender and not to you.
Right, yeah, yeah, that'sawesome.
What are some other things thatyou guys have found that have
made you know, this real estatething successful for you guys?
Obviously, you've had thestruggles.
Maybe it's lessons learned orwhatever.
What are some of the thingsthat you guys have implemented
or that have done?
Maybe it's, you know, yourrelationship with Wanda too,
like she does this, I do this,or like just any kind of tips
(25:05):
that you guys have found orthings that have made this thing
viable for you guys to do as afull-time business.
Speaker 2 (25:11):
Yeah, I mean we.
It's good because we workreally well together, even, and
even if we we have a couple ofdifferent projects going,
they're usually always indifferent stages.
So usually I'll go in first.
Me and my father-in-lawactually are the one we do a lot
of like the rough work.
We'll do the cleanup, we'll dothe demo, we'll do the framing.
You know we'll get all therough ends taken care of, hang
(25:31):
the drywall, insulate, you knowplaster, paint and well,
actually we just plaster.
And then my wife, wanda, shecomes in and she'll do the
painting and then she'll do thetrim work and she's she's really
good with all like the detailstuff that I'm not good at.
I usually, once I get to apoint I want to get out of a
property and I want to get ontothe next one, and then like she
comes in and she puts like thetowel racks in and like you know
(25:54):
, just all the trim and caulkingthe trim and like all the
little stuff, you know the touchup stuff that I don't like
doing, yeah, and that's you know, she kind of likes doing that
stuff.
So it works out really goodbecause then I can move on to
the next one and start workingon the next one, nice.
Speaker 1 (26:08):
How are you guys making decisions on what to buy?
Do you have a specific buy boxthat you guys stay pretty clear
to?
Is it more of like aopportunistic buy box?
Speaker 2 (26:16):
Okay, we're closing on these couple like I said,
we've kind of always just flownby the seat of our pants so we
don't really have.
I mean, yeah, we love the, youknow the 1945 to 55 built
ranches.
You know like everybody loves,you know.
(26:37):
But you know those are prettyfew and far between lately.
So I mean we'll, we'll reallytake anything that we can if
it's going to cash flow and wecan, you know, hopefully cash
out a little bit on on a refi,on a refi when we're done.
I mean it's just all in thenumbers.
I mean some people are realpicky about what they buy.
I don't really care if it's atwo-story or a ranch or if it's
(26:58):
got a basement or if it doesn't.
Speaker 1 (26:59):
I, you know, like I said, as long as the numbers
work, I'll pretty much buyanything Nice, very good, the
contractor thing, going back tothat and building your team.
This is an important part ofreal estate.
Right, you got to have youraccountant, like you talked
about, your bookkeeper, like allthese different people.
But I think when people arestarting out, dave, finding
people to do the work can be achallenge.
How are you guys finding these?
(27:21):
Electricians, plumbers Is it assimple as you're just going on
Google?
What about the blaster guys,those things?
What are the ways that somebodywho's just starting out can
start to build that team ofpeople who could do the work for
them?
Speaker 2 (27:33):
Yeah, so I mean, when we first started, it was pretty
much just Google and thenFacebook.
I went on Facebook and said,hey, I'm looking for a plumber,
who do you guys recommend?
And then I think somebodyrecommended the one that we use
now and I had him come in with acouple different bids and he
beat everybody and price checkedhim a few other times and he's
always beaten everybody and nowwe just have a great
(27:54):
relationship where I can justcall him and tell him that you
know, I need a couple guys thisday and they usually send them
the electrician.
We found electricians throughFacebook.
I think Wanda put a post upthat you know, if we were
looking for an electrician andsomebody recommended some this
other guy that we use now andand yeah, I mean it, just it
worked out great.
Um, I know Dwayne has gotten acouple like drywallers and
(28:17):
plasters and finished people offof Facebook as well.
It'd be just by putting postsout saying, hey, you know, who
do you recommend for this?
Speaker 1 (28:22):
And then you just reach out to them and get them
in to take a look at them Easypeasy, right.
Is that similar to lenders?
Are you doing the same thing totry to find your lenders
Facebook and that sort of thing,or what's the?
Speaker 2 (28:33):
strategy yeah, I mean lenders is typically kind of
word of mouth, you know, justtalking to other investors.
You know, hey, who did you usefor this deal?
And then they tell you, okay,they call me and ask me who
we're using, and then you know.
Then that way I can getinformation out of them on who
they're using too.
So it kind of works.
Speaker 1 (28:50):
It works both ways Nice.
A little good back and forththere, right.
That's what this community isall about.
Right, sharing some information, helping the next guy out, I
love it.
Man, do you attend a lot ofnetworking events?
Or did you attend a lot ofnetworking events to kind of get
some of this?
Speaker 2 (29:11):
I've.
They don't typically go there.
It usually always happened onnights that I got stuff going on
.
So I can't, when you got fourkids, you got a lot of stuff
going on at different times.
Yeah, a lot of the investors.
So I tried to do the caffeineand cash flow ones that you guys
have done.
We've been to a couple of them,but then usually the Wisco Rio
ones, I think, are usually onWednesday nights.
One of them were on Wednesdaynights, I think, and now it's
(29:33):
just a busy night.
So there's nothing I can dothere.
Speaker 1 (29:35):
Yeah, yeah, that's.
I love that.
I love that the caffeinecashflow option is out there now
for networking.
For people who have a lot ofstuff going on at nights, like
we have four kids, uh, it makes.
I'm going to go to that everymonth, but to get to a lot of
the other ones it's tough and Ilive an hour 15 now from green
(29:56):
Bay.
There's really no real estatenetworking up here in door
County so you gotta go, gotta goto the big city of green Bay
networking the closest thing.
But yeah, the networking piecehas been been a big part of our
success, for sure, oh, for sure.
Yeah, any other like podcastbooks, any other thing, dave,
that have been influential foryou and Wanda and your real
(30:16):
estate journey that have helpedyou guys, you know, move that
needle, so to speak, or anything.
Speaker 2 (30:21):
Yeah, I would say probably the Bigger Pockets
podcast.
That was the first one that Iever started listening to and I
kind of got in on that one andthen just kind of got hooked on
it.
I mean, anywhere I was going, Iwas listening to that one.
Um, and then when I heard the,we listened to that one before I
even bought a property.
And then I heard the one aboutthe, the burr investing, and
(30:42):
once I heard that I was like ohmy God, this is genius, like why
isn't everybody doing this?
Went home and I was talking towanda about it, she was like all
right, we'll just do it.
So I kind of went probablyanother maybe two months or so
without buying anything.
Yeah, and then I was bringingher deals and kind of just
telling them, but I was alwaysjust afraid to pull the trigger.
And and then finally one dayshe just looked at me and she's
like, you know, you always talkabout these people that are, you
(31:04):
know, getting bogged down bydecision making and you know
just kind of over, kind ofoveranalyzing everything.
She's like, if you think it's agood deal, she's like, just go
buy it, I don't care, like okay,fine.
So I went and bought that firstone, and then it's pretty much
worked out ever since.
Speaker 1 (31:17):
That's awesome and that first one was that
successful.
For you guys, that wasn't thebig grandma house.
Speaker 2 (31:30):
Yeah, no, that wasn't .
Uh, that wasn't that.
This one was just a little bed,one bath, like 650 square foot
house in Oshkosh and, like Isaid, we kept it.
I think we got it rented outnow and we bought it for $45,000
and like stuck like 20 into itI think, and it's worth like 130
now and we got it rented outfor I think like a thousand
dollars.
So we make about 400 bucks amonth, I think, on that one.
So I love it, man, I like thatlittle house.
Speaker 1 (31:55):
Those little houses.
I'll take every little two bed,one bath house.
I could find.
I love it, man, the rehabs aresmall on them and I like them.
Yeah, that's another point Ithink people forget about when
they look at the little ones is,even if you, even if it needs
one of everything, it's notgoing to be nearly as much
because you got a lot less laborand time that has to go in,
because there's a lot lesssquare footage.
Yeah, so you can make them now,granted that, was.
Speaker 2 (32:07):
That was in 2019, 2020, so material cost was a lot
cheaper.
But I mean, we actually tookthat thing right down to the
studs and rewired it, replumbedit, new insulation like
everything, and we were into itfor twenty thousand dollars.
Speaker 1 (32:20):
Oh my gosh yeah, yeah , like we've lived through the
time, we're like we're the oldpeople now that you know we used
to have to walk uphill bothways with those shoes and like
we talked about man.
We're back in 2019, we couldpick up a house for $45,000.
Speaker 2 (32:34):
Yeah.
Speaker 1 (32:34):
That's how it is.
It's different, but I see thata lot, dave, like I talked to a
lot of people that are stillsitting on the sidelines right
Analysis, paralysis, like youmentioned, fears around it, the
market they're watching themarket, the interest rates, real
estate Like, what would you sayto somebody that's sitting
there in this current marketenvironment, that's sitting on
the sidelines with some of thosesame fears that maybe you
shared back in 2019.
Speaker 2 (32:54):
Well, I mean the one, the one quote that kind of
always got me it was the besttime to buy real estate was 20
years ago.
Speaker 1 (33:00):
The second best time is right now.
Speaker 2 (33:02):
I mean, it's the only you're only gonna, you're only
going to, you're only going toget into it.
If you jump, so you might aswell jump.
We always say we kind of, wekind of jump out of the plane
and build a parachute on the waydown, yeah.
Speaker 1 (33:13):
Yeah, you guys, I really don't know what we're
doing.
What were some of your biggestfears?
You remember back in 2019, whenyou were going through this
kind of analysis, paralysisthing, like what was the biggest
fears that you were feeling atthat time?
Speaker 2 (33:25):
I mean at that point, I mean we were sitting, you
know we were, we were doing okayin the real estate, you know,
in the sales business, but it'snot like, you know, just to
think about throwing a hundredthousand dollars around like
that was just nuts.
I mean back then we didn't, wedidn't know anything.
You know, like how to do it orreally anything about it.
So I mean, we were kind of justlearning everything as we went.
And then, like I said, it wasjust you know, well, what?
(33:47):
If you know what, if it doesn'twork out, then we're sitting
there with this property that wecan't get rid of, or something.
You know, it's all the fearsthat just go through your mind.
But now it's kind of like okay,well, if it doesn't work out,
we'll figure it out later, yeah.
Speaker 1 (34:00):
I think what's fascinating about the
progression, dave and you'veprobably done this with
experience is like I was thesame way on my first one.
I remember Tony Breuer, ourfriend at Good Faith Funding.
He kind of helped me getstarted too.
And I was like, tony, what if Ican't burr out of this thing?
And what I mean by that is likepull all my capital back out or
my private money's capital backout and pay them back and have
like no money into the deal.
And he's like, yeah, so what?
(34:24):
And I was like, but then Ididn't do it, you would have 20%
down plus all your rehab money.
So like if you have like 5%stuck into it versus 25 or 30 or
whatever.
I'm like, oh okay, yeah, you'reright.
And he's like then, worst case,you just rent it and like let
it run forever.
I'm like, oh yeah, okay, Iguess so.
Speaker 2 (34:43):
Yeah.
Speaker 1 (34:44):
He's kind of a smart guy.
He knows what he's doing.
Yeah, I'm not going to tell himto listen to this episode,
cause I don't want to make hishead.
No, I'm just kidding.
Speaker 2 (34:50):
No, I, when I before we, before we started using them
to me, we had, we sat down withthem and maybe we went out to
lunch or something and kind ofjust sat and talked and I
brought them a couple of dealsthat I was looking at.
Speaker 1 (35:04):
And after, and you're like what, I can go shopping.
Speaker 2 (35:07):
This is great.
Speaker 1 (35:08):
Yeah Well, I love it because it sounds like for a lot
of people, like for me.
Once I did that first one, Istill had some reservations
about the next one, but theywere a lot less right.
Speaker 2 (35:17):
The first one I was trying to self-sabotage.
Speaker 1 (35:19):
Actually, I was like I hope this deal falls through,
I hope we don't actually get itbecause I'm scared, whatever.
Speaker 2 (35:23):
And then we crap what am I going to do now?
We?
Speaker 1 (35:26):
actually own this property and I don't even know
what the difference between awater heater and a furnace looks
like, right, and I was like,all right, crap, we got to make
this thing work.
Right.
I got the second one.
It's a little bit easier.
I got through that one and wemade some money and then, like
now, up to the point like Idon't, even, like I't even tell
(35:51):
you some of the properties thatI own, like if I drill past them
, I won't even know them,because it's just, you get that
comfort level and I'm not sayingthat to brag.
I'd be like, wow, look at me,that's awesome.
Well, Dave, this is awesome.
Man, I want to get you out ofthere because I know you got to
(36:13):
get working on this property itlooks like.
So this has been awesome.
I love all of the informationand I'd love that you bring a
little bit different perspectivethan me in what you do and
you've got a whole differentviewpoint on things and some
great tips I think everybody cantake away from here.
Specifically, I learned a lotjust about contractors and
timelines and that kind of thing.
I think there's some greatnuggets in there.
(36:34):
But I always wrap up with onequestion, and that question is
and this is more so for thosefolks who maybe aren't familiar
with Wisconsin Some people outthere in the Californias and the
New Yorks that are looking toget a yield on their cash.
We got a great state here, wethink, so we got to get them
indoctrinated a little bit towisconsin.
So favorite wisconsin traditionfor you, dave, or favorite
place to visit in wisconsin- I'dsay a favorite place to visit
(36:57):
is definitely up north.
Speaker 2 (36:58):
I anywhere up north, you know, managua, tomahawk area
.
I love going up there.
We have some land.
Um, it's pretty much straightnorth of green bay and amber,
just north of cribbets.
I love going up there and youknow, just being up north and
just slowing down a little bit,it's always always nice.
We got a lot of nice lakesaround here getting out on the
boat and you know, doing someboating Summertime.
(37:20):
We hit the Wolf River quite abit and go hit the sandbars on
the boat.
That's nice, oh nice Very good.
Speaker 1 (37:26):
That's, I think, minocqua, eagle River area so
far out of all the episodes.
I think we're taking a poll.
I think that one wins.
So I'm right there with you.
That's my favorite place.
I live in Door County, which isbeautiful, but I still prefer
if I could spend time in EagleRiver.
I'd love it up there inMinocqua area.
So for those of you guys thattuned in, we appreciate you guys
listening.
Sharing is caring, so sharethis episode.
Let somebody else get tuned inon this or anybody else you
(37:49):
think that's looking to get intoreal estate investing.
If you're new to real estateinvesting and you need some help
, or you need some connections,or you just need some guidance
on where to go, hit us up.
Go towisconsindiscountpropertiescom,
fill out the contact us form.
Somebody from our team willreach out to you and we're not
trying to sell you anything orget you going.
We just want to help you getinto the game and
Welcome back everybody to another episode of
Wisconsin Investor Podcast.
I'm your host, Corey Raymond.
I'm super excited to get intothis episode today, but before I
do I want to talk aboutWisconsin Discount Properties,
who sponsors the podcast, andI'm going to share a little deal
with you guys, like I've beendoing the last few weeks.
If you've been tuning in thisone that we had we just had out
to our buyers list, it was inClintonville, wisconsin.
(00:22):
So if you're not familiar withthat, that's a little bit west
of Green Bay, a nice littlesmall town area 99.9,.
We had it out to our buyerslist for single family house
four bed, one and a half bathand the ARV on this thing was
200K.
Would have worked really wellwith hard money lending.
So a lot of hard money lenderswill lend 65% of that after
(00:44):
repair value.
So you could have got thepurchase price plus a good chunk
of any kind of rehab budgetbaked right into that loan from
your hard money lender and hadenough spread there to make a
few bucks with having hopefullylittle to none of your own money
into a deal like that.
So there's deals like thatevery single week.
We're putting out two to fivedeals a week to our buyers list.
It's all off market stuff.
You got to be on the buyerslist to be able to get access to
(01:05):
these.
So if you want to get access tothem, you go to
wisconsindiscountpropertiescom,plug your information in and
you'll start getting instantaccess to the deals every single
week in your inbox and on yourtexts.
That being said, let's dive intotoday's episode.
I got my good buddy, dave ZeusZowski, with us.
What's up, dave?
I'm on.
How are you doing?
I'm doing good man.
So those of you guys on YouTube, you can see Dave is freezing
(01:27):
his buns off in his vehicleright now working on a property
there.
It is All right, yeah.
So if you guys want to pop overto YouTube see what he's got
going on.
But Dave, I've known Dave nowfor several years.
He's been a force in the realestate world here in Northeast
Wisconsin, him and his wifeWanda.
We had a mastermind a few yearsago.
They were part of thatmastermind and they've done
really, really well over thelast few years and flips and
(01:49):
rentals and everything else.
But, dave, tell us a little bitabout how you guys got into
this.
What does the business looklike today?
And start there.
Speaker 2 (01:57):
Sure, we got into it.
I got into real estate salesjust as an agent back in 2017,
working for expert real estatepartners, did real good for the
first couple of years as anagent and then just kind of
realized that there was moremoney in buying my own and
holding my own and flipping thanthere is in helping sell other
people's stuff, so kind of gotstarted I think it was 20.
(02:21):
Well, it's been 2019.
We bought our first propertybecause it was right when right
when COVID started Okay, becausethat one we were working on,
that one when everything justwent haywire.
Okay, still hold that propertytoday.
It's actually one of our reallygood cash flowing properties,
nice, yeah.
And then kind of just actuallythen about 2021 or 22, I think,
(02:42):
my wife Wanda, she got into it.
She got her real estate license, quit her W-2 job and we've
just been rocking full-time inthe investing and real estate
basically real estate agent.
Speaker 1 (02:53):
Nice, nice.
So yeah, you're pretty muchevery day you're talking or
working on houses or propertiesall day, every day right, I mean
, you're fully engulfed in itall the time.
Yes and last.
Speaker 2 (03:04):
And uh, last well, this last year I went and got my
GC license, so generalcontractor, so I can do, I, we
do a lot of our own work.
We don't really hire a wholelot of stuff out, so we
typically only like to work onone or two properties at a time,
just because we don't have thetime to, you know, to get into
it.
You know other properties andyou know one or two at a time is
plenty for us, for sure, forsure.
Speaker 1 (03:25):
How many, how many flips and that sort of thing
have you guys done since you got?
Speaker 2 (03:30):
started.
I would say maybe flip and sell.
I would say maybe 20, 30 thatwe've, that we've actually
flipped and sold and we I meanwe kind of go back and forth.
We were up to about 30 rentalproperties and then we sold a
bunch so and then bought somemore.
I think we're back up to 22 or23 right now, still looking to
(03:53):
add more.
We kind of we kind of wentthrough our portfolio and found
the ones that really weren'tcash flowing, that we had some
equity in, and dump those so wecould take the equity and go use
it someplace else.
So we kind of just kind ofskimmed some of the you know the
crappy ones off the top andthen kept the better ones.
Speaker 1 (04:09):
Yep, I did a little bit of that this year too and
and uh, worked out pretty well.
So I like that straight.
A little recapitalization, ifyou will.
Yeah, yeah, very nice.
What?
Let's go to that.
Back to the start, dave.
So what was the biggeststruggle that you had getting
into real estate, or maybe likeknowing what you know now, what
would you do differently if youhad to go restart this whole
journey, this whole crazy life?
Speaker 2 (04:31):
Well, one thing that I'm learning now that I know I
wish I would have just pickedone bank and just worked with
one bank, Because right now I'mtrying to figure out a bank
that'll.
I think I have a shadow on meor something here.
Yeah, that's okay's kind offunny, but so, yeah, if we just
had one bank that we worked withall the time and we had all of
(04:51):
our mortgages and all of ourproperties through, we'd have a
heck of a lot better idea ofwhat we're able to do right now,
because we have a little over amillion dollars in equity in
all of our properties, butthey're all spread out.
There's three or four at onebank, three or four at another
bank, and then nobody will giveyou a line of credit on your
properties if they don't holdthe first mortgage.
(05:12):
So that's one thing I wouldstress to people is find a good
bank that you want to work withand have a relationship with and
stick with them.
Speaker 1 (05:21):
Yeah, that is a bit of a pickle.
Now has been dave a couplebanks that we found recently
that are offering helox assecond position on on um
properties they do not hold thefirst position on.
So it's kind of a development.
In fact, I just interviewedsomebody the other day it'll
probably come out a couple weeksbefore yours, so, uh, if you
(05:42):
want to listen to that one but Idid brandon and kayla farley,
and they were talking about howthe uh banker at nicolet bank of
all banks gave them a heloc ona property that nicolet bank did
not have the first position onno, that's weird because I know,
yeah, we have our our proper uhmain residence that we live in.
Speaker 2 (06:01):
We have that through nicolet bank and we did we were
able to do a heloc on that one,but they wouldn't touch anything
else so interesting.
Speaker 1 (06:08):
Yeah, community banks are just so interesting because
it's it's very relationshipbased.
It's very much like whateverkind of seems like, whatever the
flavor of the week is for themthat they want to do, yeah, and
then when they fill that bucketof, okay, we've got enough lent
out over here, then they justcut that program off and you got
to go find another one.
And that's kind of what we'veshown.
We work with a lot of differentbanks so we have a little
(06:29):
different strategy.
But it's because a lot of timeswe've had they've had like a
great program and we've been weutilize the crap out of it and
then they shut it off and sayall right we got to go find
somebody else now who can, whocan do something else with it.
But I like your idea, I likeyour point.
It makes a lot of sense becausethen you can leverage all that
equity that you build over timeto go parlay those HELOCs into
(06:49):
what you want to do with it.
Speaker 2 (06:51):
Yeah, like I said, when you're sitting on a million
dollars in equity that youcan't use it kind of sucks
because I wouldn't need a hardmoney lender or a bank or
anything to really go buyanother property or do a flip.
I could just do it all in myown pocket and then, you know,
not have to pay all thatinterest.
Speaker 1 (07:04):
So yeah, for sure, what have been the?
You know in the mastermind wealways thought we talked about
needle movers.
You know, when we, when we hadyou guys in there, we did an
exercise figuring out one of thebiggest needle movers, what
about for you and wanda, like,what have?
What have been some of thebiggest needle movers for you
guys are the things that havemade the biggest difference?
Do you think in your guys'ssuccess in in doing this
business?
Speaker 2 (07:22):
I think we had a lady that was doing our taxes the
last couple of years and shereally I don't want to say, but
she really didn't do a very goodjob and last year we ended up
having to pay a lot of moneythat we didn't have.
So finding a good tax personbecause that took a lot of time
(07:44):
to we didn't have.
So finding a good tax personbecause that took a lot of time
to get all that straightened outand that put Wanda at the table
working on the computer, I meanfor hours and hours and hours
and finally trying to get allthat figured out.
So I would say, now that we gotthat figured out, that freed up
a lot more time for us to goand do what we should be doing,
(08:04):
what's making us money.
And then kind of realizing, youknow, when we do the flips that
there's a lot of tax money thatcomes out of that.
We usually always try to putaway for that you know we always
we're always real good aboutdoing that.
And then you know, kind ofthat's kind of another reason
why we're wanting to get awayfrom actually doing the flips
and selling and just buying andholding them more and just doing
(08:24):
a cash out refi when we get itdone, because then all that
money is tax-free anyway.
You don't have to worry aboutthat.
Speaker 1 (08:30):
Yeah, there's a couple of things that go back to
this for the audience.
Maybe some of that went overtheir head.
Like what Dave's talking about.
When you refinance a property,if you pull some equity out of
it, in that moment it'sconsidered loan proceeds, not
income, so you don't have to paytax on that money, at least
until you sell it.
At some point You'll have topay some tax on it, but in the
moment it's tax-free.
(08:51):
So now you can take that casheither, use it to live off of if
you want, if that's like yourquote-unquote income, instead of
flipping.
You're kind of flipping toyourself, but tax-free.
So you basically are givingyourself what a 20% raise just
by yourself, right, yeah?
Speaker 2 (09:10):
I mean, let's say we literally just got done refining
out of one.
It was a property that webought for like 120, I think,
and we stuck barely anything I'dsay maybe eight grand into it,
wow and then turned around andgot it rented out.
I think we got it rented outfor it's a single family house.
We got it rented out for.
I think we got it rented outfor it's a single family house.
We got it rented out for like$1,550 a month and the payment
on it is $1,350.
So cash flow is $200 a monthand I mean that's everything,
(09:34):
that's all included, because weinclude water and all that stuff
.
So you know, average cash flowis probably $150 to $200 on it
and I think we cashed out justshy of $30,000 on the refi
non-taxable.
Speaker 1 (09:49):
I mean I'll do those deals all day long if I can,
absolutely Well.
And then what's great is yourtenants are now paying down that
new debt for you again.
They started the clock over andnow five, 10 years, you've got
another possible refiopportunity pull more capital
back out again.
And I was just talking to ZachMorgan on the podcast before
this that's going to come outprobably the week before you,
and we had the same discussionof, like you know, he was
sharing an example similar tothat and we just did the math.
(10:11):
I said how long have you ownedit?
And you know it was 60,000bucks and he owned it for four
years.
And I said, well, divide 60 byfour.
And now think about that.
Divide each of those by 12.
Each of those by 12, that'syour monthly cashflow.
Even if you made zero quote,unquote cashflow, no money went
in your bank account every year.
You just put 60 grand in yourpocket, tax-free.
I mean, that's your cashflowover the years.
(10:32):
So buy and hold strategy it'stough to beat and it sounds like
you guys are going that way.
Is it because of the taximplications of the flips or
what's the reason you guys aremaking that shift?
Speaker 2 (10:45):
because of the tax implications of the flips or
what's the reason you guys aremaking that shift?
That's probably.
That's probably one of thereasons is just the taxes.
But the other reason is justbecause I like having the
appreciation too.
I mean you know what thosehouses are going to be worth in
the next 10 to 15 years.
As long as everything keepsgoing up, or even if it goes
down, it's going to come backout of it eventually.
So if you can hold on to them,even if it goes down into a turn
(11:07):
, if you can hold on to themthrough the downtimes, you know
you're going to come out evenbetter in the in the long run,
so sure.
Speaker 1 (11:13):
Well, and you look at like interest rates right now.
People complain about theinterest rates right now, even
if they went back up again, uh,in three to five years, when the
interest rates, hopefully, areback into the fives, maybe, if
low fives.
Now you refinance Now thosethings.
Now you look like a genius,right, so you break even for a
few years on cashflow, butyou're building equity, the
thing's appreciating.
You're getting debt paid on,you're getting tax benefits,
(11:35):
right, and now when yourefinance it in a few years, you
can pull some cash back out.
And now you're maybe going tolower, even lower, your payment
at that time.
And now you look like a geniusbecause your cashflow and big
money and rents typicallyappreciate as well, so they're
typically going to go up overtime too.
Well, that's exciting, man.
So do you guys have a big goalas far as, like, how many rental
units you're trying to get to,or a certain cashflow number, or
(11:57):
a certain equity number?
Are you just going to keepplugging away?
Speaker 2 (12:05):
And just probably just keep on going until we
don't have to anymore.
Okay, very cool.
I don't know, I don't see usstopping anytime soon.
Speaker 1 (12:08):
So yeah, what about?
Speaker 2 (12:09):
like I always put a goal on it.
I always say I want to get to50 by the end of the year, and
then that never happens, andthen you know, so it's like I
kind of just kind of just fly bythe seat of our pants.
Speaker 1 (12:18):
Just just do a couple , keep it going and then get a
couple more and as they come.
Speaker 2 (12:22):
Yeah, very cool, yeah , I think actually last year we
only did the last two years.
We only did one flip and sell apiece, you know each year, and
then the rest of them, we all,we kept everything so nice very
cool, very cool.
Speaker 1 (12:33):
Uh, the bookkeeping thing.
I want to go back to that.
You know, this was somethingone of our mentors told us right
out of the gates, like we'donly done a handful of deals and
we had this guy that wasmentoring us and I mean he was
amazing and he's like get a goodbookkeeper and a good real
estate specific accountant rightnow.
And we're like, well, we're noteven doing that much.
He's like, yeah, but you wantto, right?
And I'm like, yeah, he'sactually set it up now and
(12:53):
you'll thank us later.
And good Lord, you're right,cause I hate, I hate doing
bookkeeping.
Like, yeah, I don't havepatience for it, I want to go do
deals.
Speaker 2 (13:02):
Yeah, yeah, and I don't, I don't either, and
that's, that's where.
That's where Wanda, she does alot of that?
Speaker 1 (13:07):
Yeah for sure.
So those of you guys listeningout there, if you're just
starting out, get yourself agood bookkeeper, get connected
with a good real estate specificaccountant.
Even if you don't think you'reworthy of it at this, you're
going to go Right, exactly, yeah, very good, very good.
What has been like?
Let's talk about some deals.
Let's go into some deal.
(13:27):
Talk, dave, talk about like,what's the like, the biggest
rehab you guys have ever had todo?
Do you have you got?
Do you have you guys had onewhere you've had like a monster,
you know, ended up being a bigbear, and how did it work out?
Speaker 2 (13:41):
Well, I could go a couple of ways.
I could go the one that we lostour ass on.
Speaker 1 (13:46):
Well, yeah, let's talk about it, Cause I think you
want to talk about a bad one.
Speaker 2 (13:50):
I was talking to I was talking to Dwayne this
morning.
I mean I told him that I wascoming on this with you and you
were talking about it, and Isaid I'm like I should probably
just do a podcast of all thestuff that I screwed up, because
I think I messed up just abouteverything.
Hey, that's perfect.
But we bought a house.
It was actually a friend ofmine from high school it was her
grandmother's house Went into ahome.
We went down and bought it.
(14:11):
It was a huge, huge house, hugeold house, built in the 1800s
Old farmhouse.
It was like seven bedrooms, onebathroom.
Oh yeah, oh yeah.
So we at least we, you know, werearranged a bunch of walls and
did everything and I think weended up turning it into a five
bed, two bathroom, okay, andadded like a nice dining area
and all that.
I mean it was it ended up beingreally nice.
(14:32):
We ended up sticking about 130000 into it.
Wow, bought it for, bought itfor 70.
We used I think we used Tonyfor hard money.
Speaker 1 (14:42):
Bought it for 70.
Tony is a owner of good faithfunding.
He has a hard money lendingcompany and if you go back I
think he's like episode five orsomething like that, and then
his partner, jairus, is onanother episode as well.
But anyway, go ahead.
Speaker 2 (14:56):
Awesome guys to work with.
But yeah, so we use them andstuck like $130,000 into it,
figuring that it would be worthabout $250,000 when we're all
done.
So we're like, all right, we'llstill make about $50,000, you
know, after closing costs andall that, you know, even if we
make $30,000.
And it was a property that wedidn't actually do any of the
work.
We contracted everything out.
(15:17):
So again, it was one of thosedeals that just popped up and
was like, yep, I'll take it,we'll have this other, we'll
have our contractor do it andtake the whole thing.
So that way, we didn't, youknow.
So it's like, okay, we'll make$30,000 without having to do
anything, I'm okay with that.
And sat on the market.
Sat on the market, sat on themarket, couldn't sell it,
couldn't sell it, ended upselling it for $200,000.
(15:38):
Thousand dollars.
So after we were you know allthe interest and everything we
were we were behind about 30grand on it.
Wow.
So, yeah, that was that was thebiggest hit we had we had to
take.
But ouch, um.
So yeah, that was that was ourworst, worst deal ever okay.
Speaker 1 (15:55):
Okay, what was the?
What do you think went wrongwith that deal?
Let's talk to that.
Did it?
Was it an underwriting?
Speaker 2 (15:59):
well, my contractor told me that contractor told me
he was going to get it done inthree months and the other thing
was, you know, and it took himsix months.
So then we were already behindby the time we got it sold, we
were already into it seven,eight months, I think.
So then you're paying extrainterest and all the extra
closing or holding cost and thenit's just the arv.
(16:22):
Like I said, I figured a fivebed, two bath house.
I mean, even if it was an omro,it was sitting on a double lot.
I mean it was a big, huge lotwith an extra garage.
I figured it was 250 all daylong after.
But that, uh, yeah, that was adifferent, whole different area
down there, which is funnybecause it's where I'm from, I
grew up there.
So, okay, I kind of figured Iwas like, well, I know this town
(16:42):
, this town, I could sell thisfor 250 down there Didn't work
out.
Speaker 1 (16:47):
That's so good.
Well, so there's a lot oflessons in that right
Contractor-wise, what they tellyou, three months budget for six
, double whatever they tell youfor a timeline have you ever had
experience?
So you guys have worked withcontractors before.
Now you're doing your own thing.
But working with contractors,dave, now, as a contractor, what
are some things like investorsshould be doing to have a
(17:08):
successful relationship with acontractor?
Make sure that that contractoris you know, a the contractors
make money, but B there has tobe a good symbiotic relationship
there.
So, like what are some thingsyou see?
Speaker 2 (17:24):
there.
So like what are some things,you see?
Yeah, I mean I mean we still soI still contract out like
windows, roofs, siding, likepretty much all the exterior
stuff.
I don't like doing any exteriorstuff, we pretty much just do
the interior.
And I mean we got a goodrelationship with our
contractors that we use for allof those.
So I mean, and and this onewasn't he?
He kind of just he would starton the project and then all of a
sudden, well, something elsepopped up.
(17:45):
I got to run over here and justdo this for a couple of days,
and so he was constantly backand forth, you know, and you
kind of just had you just got tostay on them.
And I mean that has that's kindof been my issue with other
contractors.
That's kind of why I went andjust got my GC license, just so
I could just I don't have todeal with it anymore.
Speaker 1 (17:59):
That's why I can pull the permits you got to talk to
about this.
Speaker 2 (18:04):
You know, I can pull the permits, I can do whatever I
need to do and then I can getthe subcontractors in and, you
know, make sure they're they'rerolling.
That's actually pretty muchwhat I'm doing right now.
I'm not this.
This house that I'm working onright now is taking over the
contracting for him because he'sgot a couple other ones going
on.
So I just took over this oneand basically just doing some
(18:26):
work.
We're doing a bunch of framingand stuff and then we're hiring
out the drywalling and theplastering and the painting and
all the other stuff.
So I'm just kind of doing that.
You just got to kind of keepeverything on a timeline.
Speaker 1 (18:37):
So you're almost more like project managing besides
the carpeting stuff.
Speaker 2 (18:40):
Yeah, this one.
Speaker 1 (18:41):
Okay, cool yeah.
So somebody else could do thatwithout a license, a GC license
if it's their own property rightYep.
Speaker 2 (18:48):
Yeah, yeah, as long as somebody.
You know.
If you have to pull a permitLike this one, we had to have
the whole foundation excavatedand everything.
Speaker 1 (18:58):
So there was no way to get away without doing
anything without permits.
So you know he had to havesomebody be able to pull the
permits.
Okay, got it, cool.
So if you're doing it byyourself, like, say, dave, you
weren't licensed and you werejust going to be doing work,
you're on everything you'regoing to do by yourself, are you
still required to pull permitsand do you need a GC for that?
Or can you pull a permitwithout being a GC if it's your
own property?
Speaker 2 (19:16):
If you're the homeowner and you're going to
live there and you're livingthere, you don't, you can pull
the permits.
But if it's not your primaryresidence, then you need to have
a GC, a licensed GC pull thepermits, you can tell how many
properties I physically getinvolved with Asking these
questions.
Speaker 1 (19:32):
I legit didn't know that that's good.
So so more tips.
Give me some more tips ofworking with contractors, Cause
this is a big pain point for alot of people out there Like so
you some more tips of workingwith contractors, because this
is a big pain point for a lot ofpeople out there like so
staying on their butts.
But is there anything you guysdo on the front end as far as
like contractually, to make surethey're like?
Is there anything you can putin as far as like we're gonna
like?
I've heard other people do thisin the past years ago.
(19:53):
I feel like it's less and lessnow because contractors are in
such demand but used to be likein your contract you could put
some kind of penalty if they'renot done by a certain day, or
something like that.
Like, is there anything likethat that you're doing now or
any other?
Speaker 2 (20:05):
No, we, we had talked about it but we never, never
implemented anything, cause,like I said, we only ever had
somebody take a, take a flip anddo twice that we didn't touch
that.
We had somebody else completelydo all the work.
So I mean, we're pretty muchstaying on.
You know, I'm at the houseevery day, wanda's at the house
almost every day when shedoesn't have the book work to do
(20:26):
.
So I mean, we're, we're workingthere and, you know, making
sure everything is moving along.
If that's not what you wanted todo, then yeah, then I mean,
there's some, there's probablyyou know some wordage that you
could put into the contract thatyou need to.
You know you need to be done bythis date or give at least
progress updates by each.
You know, each time, each timeyou get to a certain step, you
(20:46):
know, like the framing's done.
Okay, I want the framing doneby this date, and then I'll
check it out and then then I'llrelease part of part of the
money that I owe you, and thenyou go on to the next one.
I want, you know, but it shouldbe painted by such and such
date, and then if it getspainted by that date, then I'll
give you that much money, okay,and kind of put it in like a
draw system, just like it iswhen you're building a house Yep
, okay.
Speaker 1 (21:07):
Good stuff.
Yeah, I think that's probablyone of the biggest pain points
is like people are like oh cool,I got somebody that'll do the
work.
Great, here's the project,here's what I want it to look
like.
And then they come back andthey're like nothing's been done
here, right, yeah.
So I think having those upfrontconversations, it sounds like,
is really important to yourcontractors too, and just having
clear expectations and ideallywritten out, uh, signed and
(21:29):
agreed on by both parties yeah,that's good.
Speaker 2 (21:32):
Yeah, the other thing I would say is make sure you
price check everybody.
Yeah, we kind of we kind of gotwe with our one, our first
electrician that we ever usedlike we just kind of got used to
him and was like, okay, we gotanother project, just come get
it done.
And he went you know, it'smostly time and materials and
and stuff like that and then allof a sudden like, oh yeah,
it'll be thirteen thousanddollars, okay.
Well, then the next hoursuddenly he sends me the bill
(21:54):
for like seventeen thousanddollars without saying a word,
like there was no talk, noconversation.
I was like, uh, what's this for?
And you know I still couldn'tget a hold of him, he wouldn't
explain it.
So I ended up just biting thebullet, paying him and then
found a couple more electricians.
So now, now we kind of you knowwe'll bring two or three in at
a time and then get bits on them, and you know, obviously most
(22:15):
of the time they're they'repretty, pretty close to each
other, pretty competitive, andyou know you kind of pick the
one that you work with the best.
But yeah, we got a pretty goodelectrician now and a pretty
good plumber, that now I reallydon't have to price check them
too much anymore because we'vedone enough of them.
Like, yeah, I kind of have agood idea of what the what the
plumbing cost is going to be andwhat the electrical cost is
going to be, before I evenbefore I even bring them in, and
(22:38):
so, yeah, well, that's a greatlittle nugget there for the
audience there guys.
Speaker 1 (22:40):
So listen back to that.
Dave was just talking aboutwhen you're getting going or
you're trying to figure out yourteam.
You got to bring a couple ofpeople in and get some
competitive bids on this stuff,on these projects.
Let's talk about timelines,dave, because I think you're in
a unique position, being inswinging hammers and doing
things and coordinating yourpeople.
When you guys go and you get aproperty, like you put an offer
(23:02):
in, you get accepted, what doesit look like between, like that
date of when you get it acceptedand when you finish the project
and you list it and list it andnow it's being sold?
Are you guys doing a lot ofstuff prior to closing besides
getting lending and that kind ofstuff?
As far as lining people up, isit start the day it closes.
Speaker 2 (23:21):
Then you start going like tell everybody a little bit
about your guy's system andprocess.
Sure, it's efficient.
So, yeah, I mean usually, likeyou know, if we're able to walk
the property and kind of get anidea of you know what we're all
going to need.
First, once we get an acceptedoffer, I'll let you know, my
plumber know, I'll let myelectrician know, if I need a
roof, I'll let my roofer knowthat you, because a lot, of, a
lot of the roofers can go offlike Google maps or they have
(23:41):
like a bird's eye app orwhatever that they can use, so
they don't even need to go tothe property, they can just look
it up, so they can give you a,they can start giving you quotes
before we even close on it.
And then that way, when, thatway, with the day we close, we
go in there, we do the clean out, we do the demo, we do
everything that we need to do,you know, get the permits pulled
and then and then bringeverybody in and we kind of have
everything.
(24:02):
We like to have everything kindof lined up before we even
close on it.
At least give the, at leastgive the subcontractors heads up
like, hey, I got this property.
When we close, you know it'llbe a couple of days after that.
Speaker 1 (24:13):
I'm going to need you , so you know, kind of give them
a heads up.
Cool, is that something you'vealways done, or is that
something you kind of figuredout once?
Speaker 2 (24:19):
you got some.
We just kind of figured outbecause you know, all of a
sudden you know you close on aproperty and you're ready for
the rough and plumbing andelectrical and they're like,
well, we're two weeks out, wecan't get to you for two weeks.
So this way, if you give them alittle bit of heads up, then
they can at least put you on acalendar for, you know, a
tentative date, private money orsomething where you're paying
high interest rate, like thelonger that baby sits, like your
seven month project.
Speaker 1 (24:44):
All your profit goes to the lender and not to you.
Right, yeah, yeah, that'sawesome.
What are some other things thatyou guys have found that have
made you know, this real estatething successful for you guys?
Obviously, you've had thestruggles.
Maybe it's lessons learned orwhatever.
What are some of the thingsthat you guys have implemented
or that have done?
Maybe it's, you know, yourrelationship with Wanda too,
like she does this, I do this,or like just any kind of tips
(25:05):
that you guys have found orthings that have made this thing
viable for you guys to do as afull-time business.
Speaker 2 (25:11):
Yeah, I mean we.
It's good because we workreally well together, even, and
even if we we have a couple ofdifferent projects going,
they're usually always indifferent stages.
So usually I'll go in first.
Me and my father-in-lawactually are the one we do a lot
of like the rough work.
We'll do the cleanup, we'll dothe demo, we'll do the framing.
You know we'll get all therough ends taken care of, hang
(25:31):
the drywall, insulate, you knowplaster, paint and well,
actually we just plaster.
And then my wife, wanda, shecomes in and she'll do the
painting and then she'll do thetrim work and she's she's really
good with all like the detailstuff that I'm not good at.
I usually, once I get to apoint I want to get out of a
property and I want to get ontothe next one, and then like she
comes in and she puts like thetowel racks in and like you know
(25:54):
, just all the trim and caulkingthe trim and like all the
little stuff, you know the touchup stuff that I don't like
doing, yeah, and that's you know, she kind of likes doing that
stuff.
So it works out really goodbecause then I can move on to
the next one and start workingon the next one, nice.
Speaker 1 (26:08):
How are you guys making decisions on what to buy?
Do you have a specific buy boxthat you guys stay pretty clear
to?
Is it more of like aopportunistic buy box?
Speaker 2 (26:16):
Okay, we're closing on these couple like I said,
we've kind of always just flownby the seat of our pants so we
don't really have.
I mean, yeah, we love the, youknow the 1945 to 55 built
ranches.
You know like everybody loves,you know.
(26:37):
But you know those are prettyfew and far between lately.
So I mean we'll, we'll reallytake anything that we can if
it's going to cash flow and wecan, you know, hopefully cash
out a little bit on on a refi,on a refi when we're done.
I mean it's just all in thenumbers.
I mean some people are realpicky about what they buy.
I don't really care if it's atwo-story or a ranch or if it's
(26:58):
got a basement or if it doesn't.
Speaker 1 (26:59):
I, you know, like I said, as long as the numbers
work, I'll pretty much buyanything Nice, very good, the
contractor thing, going back tothat and building your team.
This is an important part ofreal estate.
Right, you got to have youraccountant, like you talked
about, your bookkeeper, like allthese different people.
But I think when people arestarting out, dave, finding
people to do the work can be achallenge.
How are you guys finding these?
(27:21):
Electricians, plumbers Is it assimple as you're just going on
Google?
What about the blaster guys,those things?
What are the ways that somebodywho's just starting out can
start to build that team ofpeople who could do the work for
them?
Speaker 2 (27:33):
Yeah, so I mean, when we first started, it was pretty
much just Google and thenFacebook.
I went on Facebook and said,hey, I'm looking for a plumber,
who do you guys recommend?
And then I think somebodyrecommended the one that we use
now and I had him come in with acouple different bids and he
beat everybody and price checkedhim a few other times and he's
always beaten everybody and nowwe just have a great
(27:54):
relationship where I can justcall him and tell him that you
know, I need a couple guys thisday and they usually send them
the electrician.
We found electricians throughFacebook.
I think Wanda put a post upthat you know, if we were
looking for an electrician andsomebody recommended some this
other guy that we use now andand yeah, I mean it, just it
worked out great.
Um, I know Dwayne has gotten acouple like drywallers and
(28:17):
plasters and finished people offof Facebook as well.
It'd be just by putting postsout saying, hey, you know, who
do you recommend for this?
Speaker 1 (28:22):
And then you just reach out to them and get them
in to take a look at them Easypeasy, right.
Is that similar to lenders?
Are you doing the same thing totry to find your lenders
Facebook and that sort of thing,or what's the?
Speaker 2 (28:33):
strategy yeah, I mean lenders is typically kind of
word of mouth, you know, justtalking to other investors.
You know, hey, who did you usefor this deal?
And then they tell you, okay,they call me and ask me who
we're using, and then you know.
Then that way I can getinformation out of them on who
they're using too.
So it kind of works.
Speaker 1 (28:50):
It works both ways Nice.
A little good back and forththere, right.
That's what this community isall about.
Right, sharing some information, helping the next guy out, I
love it.
Man, do you attend a lot ofnetworking events?
Or did you attend a lot ofnetworking events to kind of get
some of this?
Speaker 2 (29:11):
I've.
They don't typically go there.
It usually always happened onnights that I got stuff going on
.
So I can't, when you got fourkids, you got a lot of stuff
going on at different times.
Yeah, a lot of the investors.
So I tried to do the caffeineand cash flow ones that you guys
have done.
We've been to a couple of them,but then usually the Wisco Rio
ones, I think, are usually onWednesday nights.
One of them were on Wednesdaynights, I think, and now it's
(29:33):
just a busy night.
So there's nothing I can dothere.
Speaker 1 (29:35):
Yeah, yeah, that's.
I love that.
I love that the caffeinecashflow option is out there now
for networking.
For people who have a lot ofstuff going on at nights, like
we have four kids, uh, it makes.
I'm going to go to that everymonth, but to get to a lot of
the other ones it's tough and Ilive an hour 15 now from green
(29:56):
Bay.
There's really no real estatenetworking up here in door
County so you gotta go, gotta goto the big city of green Bay
networking the closest thing.
But yeah, the networking piecehas been been a big part of our
success, for sure, oh, for sure.
Yeah, any other like podcastbooks, any other thing, dave,
that have been influential foryou and Wanda and your real
(30:16):
estate journey that have helpedyou guys, you know, move that
needle, so to speak, or anything.
Speaker 2 (30:21):
Yeah, I would say probably the Bigger Pockets
podcast.
That was the first one that Iever started listening to and I
kind of got in on that one andthen just kind of got hooked on
it.
I mean, anywhere I was going, Iwas listening to that one.
Um, and then when I heard the,we listened to that one before I
even bought a property.
And then I heard the one aboutthe, the burr investing, and
(30:42):
once I heard that I was like ohmy God, this is genius, like why
isn't everybody doing this?
Went home and I was talking towanda about it, she was like all
right, we'll just do it.
So I kind of went probablyanother maybe two months or so
without buying anything.
Yeah, and then I was bringingher deals and kind of just
telling them, but I was alwaysjust afraid to pull the trigger.
And and then finally one dayshe just looked at me and she's
like, you know, you always talkabout these people that are, you
(31:04):
know, getting bogged down bydecision making and you know
just kind of over, kind ofoveranalyzing everything.
She's like, if you think it's agood deal, she's like, just go
buy it, I don't care, like okay,fine.
So I went and bought that firstone, and then it's pretty much
worked out ever since.
Speaker 1 (31:17):
That's awesome and that first one was that
successful.
For you guys, that wasn't thebig grandma house.
Speaker 2 (31:30):
Yeah, no, that wasn't .
Uh, that wasn't that.
This one was just a little bed,one bath, like 650 square foot
house in Oshkosh and, like Isaid, we kept it.
I think we got it rented outnow and we bought it for $45,000
and like stuck like 20 into itI think, and it's worth like 130
now and we got it rented outfor I think like a thousand
dollars.
So we make about 400 bucks amonth, I think, on that one.
So I love it, man, I like thatlittle house.
Speaker 1 (31:55):
Those little houses.
I'll take every little two bed,one bath house.
I could find.
I love it, man, the rehabs aresmall on them and I like them.
Yeah, that's another point Ithink people forget about when
they look at the little ones is,even if you, even if it needs
one of everything, it's notgoing to be nearly as much
because you got a lot less laborand time that has to go in,
because there's a lot lesssquare footage.
Yeah, so you can make them now,granted that, was.
Speaker 2 (32:07):
That was in 2019, 2020, so material cost was a lot
cheaper.
But I mean, we actually tookthat thing right down to the
studs and rewired it, replumbedit, new insulation like
everything, and we were into itfor twenty thousand dollars.
Speaker 1 (32:20):
Oh my gosh yeah, yeah , like we've lived through the
time, we're like we're the oldpeople now that you know we used
to have to walk uphill bothways with those shoes and like
we talked about man.
We're back in 2019, we couldpick up a house for $45,000.
Speaker 2 (32:34):
Yeah.
Speaker 1 (32:34):
That's how it is.
It's different, but I see thata lot, dave, like I talked to a
lot of people that are stillsitting on the sidelines right
Analysis, paralysis, like youmentioned, fears around it, the
market they're watching themarket, the interest rates, real
estate Like, what would you sayto somebody that's sitting
there in this current marketenvironment, that's sitting on
the sidelines with some of thosesame fears that maybe you
shared back in 2019.
Speaker 2 (32:54):
Well, I mean the one, the one quote that kind of
always got me it was the besttime to buy real estate was 20
years ago.
Speaker 1 (33:00):
The second best time is right now.
Speaker 2 (33:02):
I mean, it's the only you're only gonna, you're only
going to, you're only going toget into it.
If you jump, so you might aswell jump.
We always say we kind of, wekind of jump out of the plane
and build a parachute on the waydown, yeah.
Speaker 1 (33:13):
Yeah, you guys, I really don't know what we're
doing.
What were some of your biggestfears?
You remember back in 2019, whenyou were going through this
kind of analysis, paralysisthing, like what was the biggest
fears that you were feeling atthat time?
Speaker 2 (33:25):
I mean at that point, I mean we were sitting, you
know we were, we were doing okayin the real estate, you know,
in the sales business, but it'snot like, you know, just to
think about throwing a hundredthousand dollars around like
that was just nuts.
I mean back then we didn't, wedidn't know anything.
You know, like how to do it orreally anything about it.
So I mean, we were kind of justlearning everything as we went.
And then, like I said, it wasjust you know, well, what?
(33:47):
If you know what, if it doesn'twork out, then we're sitting
there with this property that wecan't get rid of, or something.
You know, it's all the fearsthat just go through your mind.
But now it's kind of like okay,well, if it doesn't work out,
we'll figure it out later, yeah.
Speaker 1 (34:00):
I think what's fascinating about the
progression, dave and you'veprobably done this with
experience is like I was thesame way on my first one.
I remember Tony Breuer, ourfriend at Good Faith Funding.
He kind of helped me getstarted too.
And I was like, tony, what if Ican't burr out of this thing?
And what I mean by that is likepull all my capital back out or
my private money's capital backout and pay them back and have
like no money into the deal.
And he's like, yeah, so what?
(34:24):
And I was like, but then Ididn't do it, you would have 20%
down plus all your rehab money.
So like if you have like 5%stuck into it versus 25 or 30 or
whatever.
I'm like, oh okay, yeah, you'reright.
And he's like then, worst case,you just rent it and like let
it run forever.
I'm like, oh yeah, okay, Iguess so.
Speaker 2 (34:43):
Yeah.
Speaker 1 (34:44):
He's kind of a smart guy.
He knows what he's doing.
Yeah, I'm not going to tell himto listen to this episode,
cause I don't want to make hishead.
No, I'm just kidding.
Speaker 2 (34:50):
No, I, when I before we, before we started using them
to me, we had, we sat down withthem and maybe we went out to
lunch or something and kind ofjust sat and talked and I
brought them a couple of dealsthat I was looking at.
Speaker 1 (35:04):
And after, and you're like what, I can go shopping.
Speaker 2 (35:07):
This is great.
Speaker 1 (35:08):
Yeah Well, I love it because it sounds like for a lot
of people, like for me.
Once I did that first one, Istill had some reservations
about the next one, but theywere a lot less right.
Speaker 2 (35:17):
The first one I was trying to self-sabotage.
Speaker 1 (35:19):
Actually, I was like I hope this deal falls through,
I hope we don't actually get itbecause I'm scared, whatever.
Speaker 2 (35:23):
And then we crap what am I going to do now?
We?
Speaker 1 (35:26):
actually own this property and I don't even know
what the difference between awater heater and a furnace looks
like, right, and I was like,all right, crap, we got to make
this thing work.
Right.
I got the second one.
It's a little bit easier.
I got through that one and wemade some money and then, like
now, up to the point like Idon't, even, like I't even tell
(35:51):
you some of the properties thatI own, like if I drill past them
, I won't even know them,because it's just, you get that
comfort level and I'm not sayingthat to brag.
I'd be like, wow, look at me,that's awesome.
Well, Dave, this is awesome.
Man, I want to get you out ofthere because I know you got to
(36:13):
get working on this property itlooks like.
So this has been awesome.
I love all of the informationand I'd love that you bring a
little bit different perspectivethan me in what you do and
you've got a whole differentviewpoint on things and some
great tips I think everybody cantake away from here.
Specifically, I learned a lotjust about contractors and
timelines and that kind of thing.
I think there's some greatnuggets in there.
(36:34):
But I always wrap up with onequestion, and that question is
and this is more so for thosefolks who maybe aren't familiar
with Wisconsin Some people outthere in the Californias and the
New Yorks that are looking toget a yield on their cash.
We got a great state here, wethink, so we got to get them
indoctrinated a little bit towisconsin.
So favorite wisconsin traditionfor you, dave, or favorite
place to visit in wisconsin- I'dsay a favorite place to visit
(36:57):
is definitely up north.
Speaker 2 (36:58):
I anywhere up north, you know, managua, tomahawk area
.
I love going up there.
We have some land.
Um, it's pretty much straightnorth of green bay and amber,
just north of cribbets.
I love going up there and youknow, just being up north and
just slowing down a little bit,it's always always nice.
We got a lot of nice lakesaround here getting out on the
boat and you know, doing someboating Summertime.
(37:20):
We hit the Wolf River quite abit and go hit the sandbars on
the boat.
That's nice, oh nice Very good.
Speaker 1 (37:26):
That's, I think, minocqua, eagle River area so
far out of all the episodes.
I think we're taking a poll.
I think that one wins.
So I'm right there with you.
That's my favorite place.
I live in Door County, which isbeautiful, but I still prefer
if I could spend time in EagleRiver.
I'd love it up there inMinocqua area.
So for those of you guys thattuned in, we appreciate you guys
listening.
Sharing is caring, so sharethis episode.
Let somebody else get tuned inon this or anybody else you
(37:49):
think that's looking to get intoreal estate investing.
If you're new to real estateinvesting and you need some help
, or you need some connections,or you just need some guidance
on where to go, hit us up.
Go towisconsindiscountpropertiescom,
fill out the contact us form.
Somebody from our team willreach out to you and we're not
trying to sell you anything orget you going.
We just want to help you getinto the game and
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