What do Boots on the Ground Do for Us or Investors (024)
What do Boots on the Ground Do for Us or Investors (024)
Transcript:
Steven: Steve and Jill here.
Jill: Good day.
Steven: Welcome to the House Academy Show, entertaining real estate investment talk. I am Steven Jack Butala.
Jill: And I’m Jill DeWit, broadcasting from sunny southern California.
Steven: Today Jill and I talk about what do the boots on the ground do for us as investors.
Jill: What do they do for us?
Steven: I’d like to think it’s mutual.
Jill: It’s true. I hope, yeah, I hope we do stuff for you, too. So, good.
Steven: Here’s our roles in all that. Well we should take it… Go ahead, Jill.
Jill: So I’ll let them to introduce themselves this time.
Steven: Yeah.
Kristine: I’m Kristine.
Ken: And I’m Ken Bond.
Jill: Yes, and we are the Bond Family.
Ken: The boots [crosstalk 00:00:39].
Steven: Bond boots on the ground.
Jill: Right. Exactly.
Steven: Before we get into it let’s take a question posted by one of our members on the houseacademy.com online forum. It’s free.
Jill: John asks, “How do you know if a house is tenantable before you buy it?”
Steven: That’s a real fancy way of saying is, “How do you know the house is not a pile of crap?”
Jill: And the water works.
Steven: And you can’t… yeah if the waterworks and someone can actually live there. Tenantable is a legal term which quite simply means, from a legal standpoint, can somebody move in and live there.
Jill: Right.
Steven: And Jill just said it. Does it have running water? Does it have electricity? Is the roof in reasonable repair? Just regular stuff. So how do you know if it’s tenantable? You don’t. You can ask the seller. It starts with that, but until you get in there… It’s actually a very timely question for this topic today. Until you actually get in there with houses, you don’t know, and that’s the truth.
Steven: Us as investors together, although we have different roles, we have different versions of requirements for that. Everybody does. We just got done, in between recording shows, talking about a property where none of us would have ever moved in.
Jill: Right.
Steven: We bought and sold it, and did great. It was a property that we thought we were going to wholesale out, and ended up that these guys secured a buyer that had a bunch of kids, and thought it was okay to build a dirt bike track in the back of the house, and…
Jill: Not renovated at that time. We all thought it needed that. It needed the work, because it had been empty for what, ten years or something?
Kristine: Yes, a really long time.
Ken: Yeah.
Jill: And she was moving in, and hope she wasn’t still using the same fridge.
Kristine: Yeah. It did have it, yeah I built it, yeah I did.
Jill: Oh my god.
Steven: Is that house tenantable?
Ken: To my standard, absolutely not. You know…
Steven: Did the water run at all? Did the electricity work?
Ken: Yeah, water ran, and there was [inaudible 00:02:39] gas, I mean everything was there. I don’t know about the air conditioner. I don’t remember about that.
Kristine: No. Yeah, I think the septic, there was a [crosstalk 00:02:46] questioning on the septic system and stuff.
Jill: There you go. Well that’s too, before we buy it to follow up with this question. Would you get a full inspection on our own, and we pay for it? That’s important to find out.
Steven: Yeah. That’s the answer.
Jill: Now, every property that we are considering buying we still get a full inspection, and we might not buy the property, and it’s never money wasted.
Steven: That’s right.
Jill: I always feel good about it, it doesn’t matter. Just roll it under the cost of doing business. You need to do that.
Steven: Today’s topic: What do the boots on the ground do for us as investors? This is why you’re listening. If you don’t want to listen to the whole show, I’ll answer this in two seconds.
Steven: What they do is allow us to not be physically present in a house flipping deal. That allows us, in turn, as investors, to generate a lot of deals in very different geographical markets with lots of different sets of boots on the ground, and turn real estate deals quickly. I don’t think you could ever successfully do this without a physical presence in front of a seller and buyer for the local market.
Jill: Correct.
Steven: So that’s what the real huge benefit is. That’s how, that’s the text book version.
Jill: Right.
Steven: There’s a lot of other benefits because other businesses come… We’ll now start talking with you guys about starting other businesses, and there… that can, will work for your personality types, maybe even better than this. I think that there’s a huge… This is what happens in our live events. You start to co-mingle with people and establish a personal relationship, and find out that they’re really good at something you didn’t even know. Like I’m learning on this little vacation we’re having, even though we’re working, that Ken’s very good at certain parts of computers. Way better than me. That gets my wheels turning.
Jill: Exactly.
Steven: I mean that’s the short answer.
Jill: Well I was going to say, too, the thing for me is, you didn’t have a presence. There’s obviously got to be someone there, taking pictures, recording some things, getting keys, you know whatever it needs. You could, theoretically, use an agent for this.
Steven: That’s what a real estate agent’s supposed to do.
Jill: Right. Slash however. We have found out it doesn’t go that way.
Steven: They’re never going to do what these guys do.
Jill: Exactly.
Steven: Not even close.
Jill: So this is a whole different thing. What we do as… They’re part of the investment team. They’re basically co-owners in these transactions, so it’s all legal, and correct. We do it all the right way, but it’s just differently. You don’t, and this is some of the things that I still run up against with people, and maybe you listening, and watching right now you don’t know this, you don’t have to be an agent. We’re not licensed, we are investors. We’re all investors here. We’re finding assets, buying them, not representing anybody, we’re representing ourselves, and in turn selling them to somebody else. It’s seamless now for us. It’s fantastic.
Steven: Right. I mean do you guys see some useful value? Tell the truth.
Ken: On record?
Jill: Yeah, right?
Kristine: Yeah, nobody’s going to listen to this.
Steven: I mean essentially what we’re doing is creating a real estate deal that wasn’t there before.
Kristine: Right.
Steven: And then you guys are picking up the ball off the field and trying to get it to [crosstalk 00:06:14].
Kristine: Right.
Ken: Yeah, I mean, there’s so many value points that I think… You know I’ve got a story. I was thinking of a story as you were talking. So I’ll share the story.
Ken: Here’s a scenario, you know. We bought a house. We’re having the inspection done. We have to get all of the utilities turned on at this house so we can test things like the gas, furnace, whatever. In this particular, this is Phoenix, in this particular house, we have the gas man coming over to turn on the gas, and he’s going around, and he’s got his meter, and he’s, “Oh, there’s a leak somewhere, there’s a leak somewhere, so I can’t turn you on.” So, what’s that going to do? That’s going to back up all our stuff. Our inspection can’t happen, we’re going to lose time.
Ken: I had to be there for the gas guy, that’s just how they roll. He goes, “Yeah, here’s your leak. It’s coming out of this tube out of the wall,” blah blah. We go in, “Oh this is illegal, I can’t turn on the gas.” Whatever, blah blah blah. I said, “Hold, let me go to the car.” I come back with a Chrysler wrench and I undo all this stuff. I said, “Look, boom. The hose is out of the wall. It’s gone.” He goes, “I’ll turn on the gas.”
Ken: So the silly things, even like that, you know?
Jill: That’s beautiful.
Ken: Yeah.
Kristine: Yeah. So it goes back to the eyes on the ground.
Jill: And no one… I can’t think of a single agent that I know that would know that or do that.
Steven: There’s no way.
Ken: It’s the silliest thing.
Jill: Whole different thing.
Steven: And the agents… Go ahead, Kristine.
Kristine: I was going to mention, you mentioned… You made a comment about strengths. I think that’s what it is, of going back to establishing the trust and the relationship that we have, and once the four of us is… Also, leveraging our strengths across the team. Steve most of the time keeps us honest, you guys are way overzealous on what that number looks like, and Jill keeping us straight as far as the engagements with the, interactions with our sellers and our buyers. Ken having a lot of the knowledge when it comes down to the home remodeling. Just strengths [crosstalk 00:08:12].
Jill: And tools everywhere he goes.
Kristine: Yeah. And he would say my strength is probably nonstop talking as he’s [crosstalk 00:08:18] on the brakes.
Jill: That’s good, though!
Ken: That’s what it is. She gets hot.
Jill: But you love it.
Kristine: So yeah. The bond that we have, and how we help each other leveraging our strengths, I think is a good thing.
Jill: Exactly. It’s the bond Bond.
Kristine: [inaudible 00:08:35] ice cream. Remember the little bonbon ice cream?
Jill: Oh yeah, there we go. Except add a D. I love it.
Steven: Well it’s a pleasure working with you guys. Seriously. I see us expanding in some way. Tomorrow’s topic: expanding in new markets. There’s only… We’ll talk tomorrow probably about having-
Jill: What’s possible.
Steven: A very successful boots on the ground, teaching other boots on the ground and different markets to report to them, so it becomes more a hierarchy thing than it does just a flat, this way.
Jill: Exactly.
Steven: So we’ll talk about that, though.
Steven: Hey, we know your time’s valuable. Thanks for spending some of it with us today. Join us next time for the episode called, Using the Boots on the Ground, like I just said, to expand in new markets.
Jill: And to answer your questions post it on our online community at houseacademy.com. Go there, it’s free.
Steven: You are not alone in your real estate ambition.
Jill: Yeah, I’m finally remembering the name of the show.
Steven: I still can’t get it straight.
Jill: I use to say house investors, land [inaudible 00:09:37] and I’d throw it all over the place. I’m just making up stuff.
Steven: We have another show called the Land Academy Show. You should check it out.
Jill: Exactly.
Steven: We can’t keep it straight.
Jill: I know. We have, I don’t know what, three, four, five episodes over there? Quite a few.
Steven: More than a thousand.
Jill: A lot. Wherever you’re watching, or wherever you’re listening, please subscribe and rate us there.
Steven: We are Steve and Jill.
Jill: Information.
Steven: What happened?
Jill: I goofed. You want to do it again?
Steven: Sure. We are…
Jill: Okay, ready? Three, two, one… We are Steve and Jill.
Steven: We are Steve and Jill. Information-
Jill: And inspiration-
Steven: To buy undervalue property.
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