Posts tagged "investing"

JC 105: Learning From Our Experiences with Dave Holman

January 21st, 2021 | no comments

Eventually, You’ll Get Your Home Run.

When it comes to the world of real estate investing, there doesn’t have to be a distinction between doing well and doing good. Enter Dave Holman, a man on a mission to use real estate to solve problems and improve communities. Having nearly a decade of experience as a real estate investor, Dave is passionate about teaching others how to achieve doing well by doing good.

Dave’s story did not start in real estate. His first major investment took place right out of college when he co-founded a multi-lingual retail chain in Bolivia, The Spitting Llama Bookstore and Outfitter, with the hope of improving the country’s social environment and ecology. It wasn’t until five years later that he entered the world of real estate investing and brokering with a similar mission: to help benefit residents, investors, and the planet.

Dave now co-owners 94 rental units in Southern Maine, enjoying his time working with investors, owners, residents, and contractors to help with energy efficiency, syndications, and property management. In addition to investing and brokering, Dave expresses his passions through writing and is the author of three books: Youth Renewing the Countryside, Coffee Smuggler, and Cyber Fire.

Dave Holman joins John Carney today in The Real Estate Locker Room to talk about the deals that work and the ones that don’t, and how we learn from the setbacks.

Key Points:

  1. Don’t try to hit a home run on your first time out.
  2. The economics of owning is better than the economics of renting.
  3. Sometimes the deals you don’t do turn out to be the best deals.
  4. Coordinate your team to make it work.
  5. Use your brain instead of your heart.

Favorite Sport:

  • Distance Running

Favorite Books:

Pro tip:

  • Investigate energy efficiency in your buildings. It will be one of your biggest expenses.
  • Search for focus.

Resources Mentioned:

Reach Out to Dave Holman:

Thank you, Dave, for taking the time to share your experiences with the audience.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

JC 095: Investment Tribe Partnership with Travis Smith

July 23rd, 2020 | no comments

Find Your Tribe + Build Your Wealth.

With a strong background in financial services, Travis launched Tribevest after a rocky start at getting into real estate investment with his brothers.

Tribevest began when five relatives decided to pool their resources by each saving $500 a month to invest. The agreement was fruitful! They were able to purchase investment properties, become partners in a physician’s practice, and even purchased a prize-winning racehorse. Travis leveraged their success and his leadership experience to help others. Tribevest was created to streamline financial collaboration among groups (tribes) and continues to evolve as the more tribes use the platform.

Travis Smith joins John Carney today in The Real Estate Locker Room to discuss the benefit of finding your tribe.

Key Points:

  1. Find your tribe, pull capital and get into the real estate game.
  2. Resilience is the most valuable attribute in life, business and sports. Be willing to be humble, swallow your pride and you will learn.
  3. Tribevest is a group operating system that allows for transparency and accountability for investors.
  4. “More important than the rules are the rules upfront.”
  5. How to minimize risk? Your tribe will lessen the risk, multiply your capital and increases your chances of being successful.

Favorite Sport:

  • Basketball

Favorite Athlete:

  • Lebron James

Favorite Books:

Pro tip:

  • Write down three gratitude’s, visualize, journal and meditate every morning.

Reach Out to Travis Smith

Thank you Travis for taking the time to share how a tribe will lead you to financial success.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

 

 

 

JC 086: Raw Land Investing with Scott Bossman

March 11th, 2020 | no comments

Creating Passive Income in Raw Land Investments.

Scott Bossman and his wife, Erin, have been investing in raw land for 4 years. Scott was able to replace his income as a Physical Therapist in just 2 years and he quit his job in 3 years. He now works as a PT just 1-2 afternoons a week and enjoys the luxury of working at home on his land business. Scott and Erin’s land business has enabled them to spend more time with their family and to experience a degree of financial security that they never dreamed possible.

Scott is now a member of the Land Geek team, and is passionate about sharing what he’s learned to inspire and educate others to pursue their dreams of financial freedom through raw land investing.

Scott Bossman joins John Carney today in The Real Estate Locker Room to discuss the Land Geek program and how it can build you wealth.

Key Points:

  1. You need discipline and consistency to create good habits.
  2. Marketing: Mailings work great. If you are using a mailing system, you will require a fine-tuned system to scrub your list and indentify your targets.
  3. Get a team and a system in place to delegate tasks and duties. Outsource or train people to work on your biggest pain points.
  4. If you follow the math for the Land Geek program, you will see results for $4-5k in passive income in a year’s time.
  5. The raw land market is vast and can be bought, marketed and sold online from anywhere in the world.

Favorite Sport

  • Baseball: Cubs
  • Basketball

Favorite Athlete:

  • Ryne Sanberg

Favorite Books:

Pro tips:

  • Journal everyday and self score your progress.
  • You need to feel a little discomfort with your decisions to motivate you to succeed.

Reach Out to Scott Bossman

Thank you Scott for taking the time to share how to buy and sell raw land and generating passive income with the audience.

Listen to all the episodes of The Real Estate Locker Room Show, and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

 

 

 

JC 083: Finding Your Grit with Keir Weimer

January 22nd, 2020 | no comments

Taking on Big Challenges and Calculated Risks.

Keir Weimer has a passion for taking early-stage ideas to market and growing teams, cultures, and businesses around them. Despite his success today, Keir’s journey was anything but easy. At the age of 23, he was convicted of vehicular manslaughter after causing a tragic boating accident that killed his friend.  Keir had to overcome life struggles and decided to become an entrepreneur.

Today, Keir is an internationally recognized, luxury real estate agent and team leader. He is also a successful real estate and lifestyle entrepreneur, having founded and grown several 7-figure businesses in the areas of luxury brokerage, investment, hospitality development, and now a multimedia company. Keir is considered an expert in these areas and has broken free from adversity with his unique life story. His success has been featured in major global media outlets such as the Wall Street Journal, The New York Times, Bloomberg, and Sotheby’s International Realty.

Keir Weimer joins John Carney today in The Real Estate Locker Room and discusses pulling yourself up from your bootstraps and learning how to list luxury properties.

Key Points:

  1. You will accomplish great things when you put your mind to something, create a mental road map, and are patient.
  2. Find your circle of support. Never give up on the vision and persevere until you reach it. Write it out, make it part of your daily routine, be accountable for it, and get to work
  3. In order to be successful, you must be willing to work through the obstacles and setbacks.
  4. Don’t be intimidated by big challenges. Try, don’t stop just because you don’t have experience. Build a vision, build a strategy that supports the vision, and take a calculated risk.
  5. Tips for getting started in real estate:
    1. Chart out a vision if you want to get started.
    2. Know your skillset.
    3. Find the people with the expertise you need.
    4. Work with mentors.
  6. Personal growth tip: Schedule time to be creative.

Favorite Athlete:

Favorite Books:

Pro tip:

  • “Don’t count time. Make time count.” – Mark Weimer

Resources Mentioned:

Reach Out to Keir Weimer

  • keirweimer.com

Thank you, Keir, for taking the time to share your story and life advice with the audience.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

 

JC 075: Self Directed IRA Investing with Brian Eastman

September 18th, 2019 | no comments

Diversify and Multiply Your Options

Brian Eastman is a principal and Sr. Consultant at Safeguard Advisors, LLC based in Boulder, Colorado. He has personally worked with thousands of independent investors over the years and has a deep understanding of the tax framework that governs self-directed retirement plans as well as how to actually implement such plans successfully in a variety of real estate-related transactions.

Brian has been investing in real estate personally with his self-directed plan for 15 years and has participated in sub-division development, flipping properties, rentals, lease options, and trust deed financing of various types of property.

Brian Eastman joins John Carney today in The Real Estate Locker Room to talk about liberating your tax shelter retirement money for real estate investing.

Five Key Points:

  1. You have the option of using your retirement money to invest in real estate instead of the stock market.
  2. Real estate is a tangible, manageable and controllable for the investors and offers consistent cash flow to grow their retirement savings.
  3. You may enter into various real estate syndications (i.e. crowdfunds) due to the regulations becoming more relaxed.
  4. The real estate markets are favorable to multifamily and commercial real estate due to increasing demand and opportunities.
  5. Daily habits that keep you focused as a real estate investor include regular exercise and maintaining a work life balance.

Favorite Sports:

  • Fencing

Favorite Athlete:

  • Magic Johnson

Pro tip:

  • Be mindful, take the time, rely on true expertise, think things through, and develop a business plan.

Reach Out to Brian Eastman:

Thank you Brian Eastman for taking the time to talk IRA investing with the audience.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2019

 

 

JC 065: Real Wealth-Building with Tyrone Jackson

April 24th, 2019 | no comments

Financial Freedom through Financial Education

Tyrone Jackson went from theater and voice-over acting in movies and commercials to being a trusted stock market trader, mentor, and best-selling author who has built his reputation on his unique ability to make stock market trading and investing accessible to people without a financial education.

Stock and real estate investing run together to create financial freedom. Through his program, The Wealthy Investor, as well as live seminars in NYC and LA, Tyrone teaches retail investors how to successfully trade and invest stocks and options and how to profit in every market environment. His work has been featured on Nasdaq.com, CBS Marketwatch, the Los Angeles Daily News, and on YahooFinance.com.

Tyrone Jackson joins John Carney today in The Real Estate Locker Room to discuss how he got started in wealth-building, became a self-made successful investor, what it takes to successfully build wealth, and personal and professional tips and habits he’s learned along the way.

Five Key Points:

  1. Success is so much more than what is seen – there’s a lot of hard work that goes on behind the scenes, strategies in place, and even some failures that happen before success comes.
  2. Wealth is really nothing more than a series of positive habits. It’s not just trading time for dollars, it’s taking a little of what you have, and putting your money to work (with a piece of real estate, mutual fund, or even one stock).
  3. If you shift your consciousness, and seek a financial education, your life can change. The more you commit to wealth-building, the more it will commit to you.
  4. To get into wealth-building, learn to speak the money language – it’s the language of billionaires.
  5. Stock and real estate investing go together. With both, it’s never an “either/or,” it’s “both/and” – you want to build a stock market AND a real estate portfolio as part of your wealth-building plan.

Favorite Athlete:

  • Michael Jordan

Favorite Book:

Pro tip:

  • Dreams become reality step by step, and you will achieve what you focus on most.

Resources Mentioned:

Reach Out to Tyrone Jackson:

Thank you Tyrone for taking the time to share your wealth-building success tips with the audience.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2019

 

 

 

 

 

JC 056: Investing Outside of your Backyard with Nir Babajani

December 5th, 2018 | no comments

Real estate is not passive investing

Nir Babajani is the Founder of Nadlanir, an Israel-based investment company whose primary clients are Israelis who are investing in the US property market. Nir started in 2012, when he first took the risk of investing outside of his country. Nir’s passion to begin his company was driven by the frustrations at US properties being offered for sale at outrageously high prices in his country. He turned that frustration into motivation and that led him to creating a service to enable Israelis to confidently purchase US investment properties.

Nir joins John Carney in The Real Estate Locker Room to chat about the pros of investing outside of your country. He shares the challenges that new investors will face in foreign countries, the clients that he serves and the types properties that his business focuses on. Nir tells the story of how he became involved in US real estate and how he utilized his experience as a project and risk manager to succeed in this industry.

Five Key Points:

  1. Many investors have the money, but they don’t have the time.
  2. Inside information is where the money is made in real estate investing
  3. Understanding real estate is about understanding what you know, your resources, and your goals.
  4. Successful people have daily routines. Allocating time for reading and exercise is training for success.
  5. Knowing what the house looks like before it is renovated enables you to know everything about it.

Favorite Athlete:

  • Ronaldo, Brazilian Football Legend

 

Favorite Sports:

  • Football (Soccer), Cycling, Tennis

 

Favorite Books:

 

Pro tip:

  • Be open to investing in markets outside of your backyard. A wise investor is open to investing in other countries.

 

Reach Out to Nir Babajani:

Thank you Nir for taking the time to share your thoughts on investing in US property from foreign countries.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at http://www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2018

JC 029: How to Invest in Land from Anywhere with Mark Podolsky

October 25th, 2017 | no comments
Capitalize and Earn Passive Income by Investing in Raw Land 

Mark Podolsky is known as the Land Geek, a title he’s earned for focusing his business on raw land investing. He’s been in the business for over 16 years and has completed over 5,000 land deals with an amazing average ROI of 300% on cash flips, and more than 1000% on deals sold with financing terms. This is quite the achievement if you consider the first deal he made in 2001 was worth only $3000.

Mark says his reason for getting into investing was to simply escape the rat race. Prior to his current business, he was trapped in a state of “no work, no pay” status. Top that with high amounts of stress and not having enough “me” time, Mark knew he had to find a way out fast. Now Mark barely works 5 hours a week, and has created his business in such a way that not only is it mostly automated, but also manned by a great team with the same vision he possesses.

Five Key Points:

  1. Aim to reach the point where you spend less time working IN your business and more time working ON the business.
  2. If we don’t pay for something, we typically don’t value it very much.
  3. The neighbors can be your built-in best buyer.
  4. Selling lands allow you to be free from renters, rehabs, renovations, or rodents.
  5. The primary benefit of selling raw land is you have a massive market and only few are doing it.

Favorite Athlete:

Favorite books:

Pro tip:

  • If you’ll do for the next 3-5 years what other people won’t do, you’ll be able to do for the rest of your life what other people can’t do.

Reach Out to Mark Podolsky:

Free Gifts:

  • Email Mark at support@thelandgeek.com with the subject heading “real estate locker room” or “John Carney” to get your passive income launch kit for free.

Thank you Mark for taking the time to share your expertise on raw land investing with us.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at http://www.johncarneyonline.com

Connect with John Carney
Facebook: www.facebook.com/JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2017

JC 017: Apartments, Banking and Politics with Michael Gibbons

June 28th, 2017 | no comments

All people want to live in a nice property

Michael Gibbons is a highly respected investment banker with decades of experience successfully owning and operating multi family real estate. Mike is the senior managing director, principal and co-founder of Brown Gibbons Lang and Company (BGL) with offices across the USA and Global M&A Partner offices in more than 40 countries across 5 continents, which allows BGL to deliver their clients unparalleled access to corporations, investors, and opportunities globally.

Michael always had an interest in real estate and started out with a few doubles and a 4-plex. He learned how to install toilets and more importantly what it will take to run a real estate ownership organization effectively. The key is to build up the number of units that you are managing so that you don’t have to personally do all of the work.

Michael and his team are dedicated to providing well-managed, quality multifamily homes. Michael owns an interest in over 10,000 units and lives by the philosophy that each unit must be “good enough for mom to live in.” He believes that everyone deserves to be proud of where they live, and the apartment communities that he owns provide a safe, clean, well-maintained and friendly environment that residents are proud to call home.

Michael’s winning formula is to look out for undermanaged and/or poorly maintained properties and apply a high standard to maintenance and management. You must apply social responsibility to your real estate investments and success will follow.

Michael Gibbons is on a mission to save America. He is entering the political arena and running for a seat in the US Senate representing Ohio. He believes that “the government doesn’t create jobs, business creates jobs.” Michael doesn’t want to be a career politician. He wants to apply his business knowledge in Washington to serve the American people and accelerate the growth of the US economy.

Five key points:

  • Everybody has to start somewhere – Michael entered the business of real estate investing where many entrepreneurs start, buying single-family properties and working from the ground up to restore and resell them. The small details that Michael learned during his early days set him up for success in the future.
  • “If the unit isn’t ready for your mother to move into, it’s not ready to rent to someone else.” – people want to be proud of where they live. This applies to all income levels. BGL looks for undermanaged or poorly maintained properties and applies defined management strategies to improve the situation, providing people with a safe, clean, well-maintained place to live, somewhere they can be proud to bring their friends and parents to visit.
  • Find tenants that fulfill their side of their contractual obligations – always pay their rent in full and on time. It is dangerous territory for landlords to get into situations where they allow tenants to stay without paying rent for any period of time. This practice can quickly lead an investor to defaulting on mortgages. Retain high credit standards, source tenants that have pride in themselves and their property and they will in turn take pride and care for your property.
  • Utilize modern technology – install video cameras in your multi family investments. “We have found that with the technology that’s available now, if we put up camera systems, generally people behave properly if they’re always on camera in common areas.”
  • Every person involved in real estate is important – from the person fixing the electrical faults to the person vacuuming the hallways, insure that you have a team with the correct cultural fit and chemistry. Success comes when the work is fun and you’re surrounded by other people that “find it fun” and are also willing to put in the hard

Mike is a three-sport college athlete. These are his top three favorite athletes;

  1. Jean Gibbons – Michael father, world class athlete, wrestler & coach
  2.  Aaron Shea – former NFL player and Mike’s son-in-law
  3.  Tom Brady – NFL quarterback for the New England Patriots and godfather to Mike’s grandson.

Favorite books:

  1. God’s Gold: The Story of Rockefeller and His Times by John T Flynn
  2. The Constitution of Liberty by Friedrich A Hayek

You can reach out to Michael at BLG, http://www.bglco.com

For more information about Michael Gibbons US Senate campaign visit –http://www.gibbonsforohio.com

Thank you Michael for taking some time out to share your story with us.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at http://www.johncarneyonlie.com

POST GAME REPORT: Episode Transcript

JC 017: Apartments, Banking & Politics with Mike Gibbons

Michael Gibbons is on a mission to save America

Announcer: Welcome to the, “Real Estate Locker Room Show” with John Carney. Did you know investing in real estate is a team sport? Join John and his guests as they explore the business of real estate and athletic competition. The goal for this show is to grant you direct access to the real estate pros that are closing profitable deals and growing their businesses. On the “Real Estate Locker Room Show” we are getting in the ring with successful investors, developers, operators, and all of the industry professionals to learn what it takes to achieve on-going success. Now it’s time to kick-off and level up with new ways to grow your real estate business.

 

John Carney: Welcome back to the Real Estate Locker Room Show. I’m your host John Carney, coming at you again today from Cleveland, Ohio. The goal for this show is to help the listeners raise the bar in their real estate investment game. Joining me today is a great guest, he is a mover and a shaker in the multi family world of real estate, specifically here in Northeast Ohio and I will let him talk to you about his formula for success in just a moment.

 

But I’d like to welcome Michael Gibbons. He is the senior managing director, principal and founder of Brown Gibbons Lang and Company. Michael provides an active senior role to client engagements and business development opportunities. Now Brown Gibbons Lang and Company, or BGL, is a leading independent investment bank serving the middle market. BGL specializes in merger and acquisitions, advisory services, debt and equity placement, financial restructuring advice and valuations and financial opinions. With global industry teams in business services, consumer, health care, industrial and real estate, BGL has offices in Chicago, here in Cleveland, Ohio, Salt Lake City and global MNA partner offices in more than 40 countries across five continents, which allows them to deliver unparalleled access to corporations, investors and opportunities globally.

So, we’re going to learn a little bit from Mike about when you scale up a business like BGL, and you get into real estate, you can certainly apply those business skills in that competitive environment of high finance to apartments.

Now, immediately prior to BGL, Michael was president and CEO of Underwood Newhouse and Company, a leading regional securities and investment banking firm in Houston, Texas. And prior to that he was senior vice president for McDonald and Company here in Cleveland. And recently, Mr. Gibbons has announced that he will be running for a spot in the US Senate right here, for a seat in northeast Ohio as well.

Welcome to the show Mike, thank you for taking the time out of your very busy schedule to share your experience with our listeners.

 

Mike Gibbons: Well I’m glad to talk to you John. I want to make one correction though, we’re no longer in Salt Lake City; we’re in Irvine, California, San Antonio and Philadelphia. And that was a brief stint in Utah where we were unable to really make it work there. And it’s kind of an organic process that you go through and as you staff various locations with various skills you take advantage of that, and we’re doing that.

 

John Carney: Your resume is extensive. We want to drill into the real estate, and we talk a little bit about sports, we call it The Real Estate Locker Room Show basically because there’s just as fierce a competition out there in the real estate market day in and day out, probably the same in the MNA market day in and day out as you would see in the super bowl, correct?

 

Mike Gibbons: Well, it’s a very competitive business. I was warned many times before I started it that the likelihood of success, particularly out of Cleveland — and that’s where I wanted a family, and really commuted to Houston for four years, in a very tough environment in Houston, and came to Cleveland and said, “You know, I can’t go back to where I was,” just wasn’t the right thing for me to do, and started BGL.

I had an early setback, far greater setback for my partner, as is noted in the name of the company Brown Gibbons Lang — well Kevin Brown was a wealthy entrepreneur and had a bit of wealth from an inheritance. We had become friends and we were going to set out, with his capital support and my deal skills I developed, and form a company. Unfortunately, Kevin was killed a month and a half after we started the firm in an offshore powerboat race. Actually, the Trump race in Atlantic City. I and a number of my friends were there to watch him and he came into the restaurant where we were sitting — and actually we were playing Blackjack. First time I was ever in a casino in my life. — And he said, “Go home guys it’s too choppy.” By the time we got home, sat around for an hour or two with my family, and we got a call from one of my friends and said Kevin had been killed in the race that he wasn’t supposed to run.

And it was an unfortunate occurrence, but it created the true entrepreneurial situation where I was left with basically my capital, which was relatively insignificant at the time, and a telephone. And that’s where we started. So it’s all worked out, and it shows you what you can do in America if you just set your mind to it. I’ve been very fortunate to have the opportunities I had, and we tried to make the best of it.

 

John Carney: So just can you just tell a brief — talk about how you went from investment banking and how you stumbled into real estate and what that looked like?

 

Mike Gibbons: Well it really wasn’t a stumble, John. I was very interested in real estate, literally from the day I got out of graduate school. I remember I read a book called No Money Down. Since I didn’t have any money, that was an important part of where it started from. And I began acquiring with very little down payment money, had a real estate license and used my real estate license. And the commissions I’d receive on the acquisition side helped acquire various things and would buy some double houses and eventually a four-suiter.

None of those were very successful but I learned a lot. Not only did I learn how to install toilets efficiently, but I understood what it would take to really run a real estate ownership organization effectively. And the key is to building the number of units that you’re managing to where you don’t have to do all the work. Because if you try to do all the work, you’re very limited in the scope of what you can know. And I started out that way, sold those off as I was advancing in my career. But again, I always had that interest and attraction to real estate.

I was in capital markets in the financing business, advising businesses, and I was always attracted by the relative certainty of the cash flows versus the various business I was working in. And I never really had any engineering training or I really didn’t understand how manufacturing worked early on. And obviously, I’ve been in probably one of every kind of manufacturer in the nation and got to learn about their processes and how they operated over the many years I’ve been in the business. But during that period I always had an attraction to real estate. And indeed I was part of a partnership in a regional investment bank where they permitted you to make investments outside the normal scope of everyday business. And I got a couple of partners and one of them ran the real estate. And at one point we got up to a relatively significant number of multi family units that we’d owned jointly. I owned a relatively small percentage of them, of the whole enterprise. But again, expanded my knowledge just from being around and looking at properties, buying properties, financing properties.

And then as my career progressed I found myself working with real estate enterprises. And I was always — my early days were public finance, I was using tax exempt debt to do financing for various enterprises. And at that point in time, under the tax laws in the United States where you created an increase to employment you could use tax exempt financing. And the firm I was with, McDonald and Company, was a very significant underwriter of that kind of capital back in that period.

So I just learned more about the financing markets, the mathematics of financing. And ultimately kind of left public finance and moved into more financial institutes in bank, corporate finance type activities; took converted mutuals to stock, in smaller institutions and worked with REITs – a few of them that worked back in those days. And then when I went to Houston, which was supposed to be a two-year stint that turned into a four-year stint, I did it largely because McDonald and Company had gone public. They didn’t have the same cultural fit that I had felt so comfortable in while it was a partnership, and really sought that kind of partnership structure where I could own a piece and help build a company, help build something that I own.

So in doing the thing in Houston I was already — I still had my real estate partners up in northeast Ohio; we were still acquiring and improving and selling multi family during that period of time. And when I came back to Cleveland and formed BGL I was all about MNA for 20 plus years.

And right around when the crash came, actually maybe a little bit previous to that, I had consented to doing a development deal while still at BGL. It was a multi family with an older gentleman that I had established a great friendship with. I did that, saw the deficiencies in the way that they were then managing the properties, and ultimately wanted to create an organization that I could use BGL and investment bank as a platform and create an organization where we had very fine management, and kind of fit my philosophy of investing in multi family. And we’ve done that now for seven or eight years, and we’ve achieved some pretty good milestones in that period.

 

John Carney: So yea, hardly a stumble in. That’s a correction without understanding the whole story, for sure. But so, I suppose the important take away I got from hearing the whole timeline was you started out with single family homes, a few duplexes, probably spent some evenings there applying paint and fixing plumbing without a license–

 

Mike Gibbons: Many, many.

 

John Carney: — so that your tenants could move in the next day. And that is a familiar story with just about every single real estate investor I’ve interviewed to date.

 

Mike Gibbons: You’ve got to start somewhere, you know?

 

John Carney: You have to start somewhere. And then what does that look like today? And where —

 

Mike Gibbons: Well, in a week — I don’t own 100% of very many things, I have a few I own 100% of, as far as real estate dwellings. But generally we’re operating in LLCs, oftentimes it’s the partners in the investment banking business, at times we’ll take in outside investors.

And I didn’t mention this, but early in the days of Brown Gibbons Lang, having been in Cleveland, I knew a lot of the developers in the region, largely stemming from my public finance days as a matter of fact. And I was in a very good position to — down a number of REITs formations, and we took them public while I was in Houston. And the real estate investment trust business changed considerably in the early ‘90s. Prior to that, you needed a separate enterprise to manage those businesses, or to manage the real estate homes that were owned by the trust. It was a very unwieldy, difficult structure to operate in and all that changed in the early ‘90s. And because of my relationship with some of those developers, because I had as much familiarity with REIT structures as anybody probably in the Midwest at the time — I wasn’t an attorney and didn’t work in those areas, I was really an investment banker that had worked with the formation of REITs –I was called on to use some of the expertise I’d developed to advise a number of REITs and their formation, and actually model those enterprises for largely a collection of partnerships; model those pre-excel. I was using Lotus123 back in those days. And created those models and took them to Wall Street, found an underwriting team and we took a number of REITs public where I acted as the advisor, BGL acted as advisor.

Around northeastern Ohio it was Associated States and Developers Diversified, both of those were enterprises that I advised on their formation. I ended up on the board of Associated States after about ten years, became an active board member, shared financial planning and really kind of studied where real estate performance was. Being in the Midwest, it’s very much different than if you’re in the coast or in you’re in the hot growth areas. We have a housing stock here that’s a bit older than most other locations, and I was always tied to Ohio and tied to Cleveland, this is where I love to live. I had spent four years commuting, coming back here every weekend almost. Coached my daughter’s soccer team, I was an assistant coach while I was working in Houston, so I was always connected to northeastern Ohio. So the natural place to invest was northeast Ohio. But the housing stock in a city like Cleveland or around Cleveland is very much different than you’ll see on the coast or in Florida or in Atlanta or in Dallas.

Having been on the border of public multi family REIT, I kind of studied what the differences were and where I thought I could make a difference and also do well for my investors if I had them. And kind of developed a plan. And generally we’ve stuck with working class housing, is what it’s called now. I think we were lucky enough to identify that earlier in the trend, and it’s now become a topic of conferences to talk about work force housing.

And I just have a philosophy about people and about where they want to live and how they feel about living in a certain situation. And I took that philosophy and applied it to my real estate investment. I believe that every single person in the United States wants to be proud of where they live, and they want their friends and family to come over and visit them and not be embarrassed of the maintenance levels of the property that they’re living in. They want to walk through a lobby that looks like they’re prosperous and they’re living in a well maintained, well managed facility. And I think that’s true across all income levels. I don’t think it’s any different, no matter if you’re struggling in a lower wage job to you’re a wealthy person that just doesn’t want to have any duties of home ownership. And I think every level of those you can do more and more, commensurate with the level of rents and the level of profitably.

So what we look for are properties that are undermanaged or poorly maintained, and our effort is to find those, buy those cost effectively and manage them in the way I just talked about. We have a rule with our management operation: if that unit isn’t ready for your mother to move into it’s not ready to rent to somebody else. And I think a lot of businesses say they have a social responsibility too, and I think anybody that’s operating in America in business should have a feeling of social responsibility. And one of those things is I want to make our tenants lives a little better, because we do the things that need to be done when they need to be done and provide with them with a safe, clean, well maintained place to live. And some place they can be proud to bring their parents or their friends and feel comfortable going in and bringing them there into their apartment. And I think that’s a solution that’s worked for us very well.

 

John Carney: So would you say your approach and your philosophy has to be in some respect a point of difference; do you see a dramatic change when you buy a property that’s under managed and in need of repair. And can you just talk about the turnaround that you see with existing tenants. And then how that would compare to someone across the street or next door that just doesn’t have that same attitude about providing an environment that you’d want your own mum to live in.

 

Mike Gibbons: Well, you know, it doesn’t happen immediately. I think you have to convince the tenants that live there that you’re different, and it takes a while to do that, you can’t just come in — we typically don’t come in with a total rehabilitation of the project, because in many cases we just can’t afford to do that.

One of the advantages of investing in workforce housing — and I might add, not everything we have is workforce, we have some higher end properties but we don’t really have the low-income properties. We don’t have any units that would be considered low income. It’s people that work; they may not make professional level salaries, but they certainly are hardworking and they have pride in themselves. And generally you want tenants to have pride in themselves because they are going to have pride in the property that they’re living in, and they’re not going to do damage or dump litter, or they’re going to keep the place clean and not fight the management company.

Oftentimes when you see these undermanaged properties, they’re just not well managed in a number of ways. If you don’t pay your rent, and you have tenants that don’t pay their rent on time — unfortunately we’re not the government where we’re responsible for making sure that everybody has their rent payment every month. So we have very high credit standards and the reality is, is I wish I was in a position to give everybody free rent. If I was in that position it would be a wonderful thing. I try to contribute a significant portion of my income to help those kinds of people, but you can’t do that and have a business. So unfortunately, you’ve got to have people who pay their rent on time. The minute you start allowing people to live there while they aren’t paying rent — I’ve seen a lot of property owners make that mistake; so they’ll try to negotiate with the tenants and they end up defaulting on their mortgage. And you wouldn’t be interviewing me right now if I’d defaulted on a number of mortgages over a period of time. And when a relatively small percentage of your tenants aren’t paying rent you can find yourself in that position.

I’ve never defaulted on a mortgage and I don’t intend to, and the only way to be certain that that isn’t going to happen is to make sure you get cash flow under the contractual arrangement that you have with those tenants. And it’s a win/win situation: we’re going to keep the property up in good condition if they just meet the terms of their contract, which is paying their rent on time.

And oftentimes we’ll move into a turnaround situation, under managed situation, sometimes even over managed situation, where they have a few other different characteristics we can get into. But that undermanaged situation, generally they’re letting people slide by, and you’ll end up with the tenants owing multiple months’ rent, that’s a recipe for disaster. That’s when you talk about the decline of areas and properties, that’s what usually leads to it.

Everybody talks about the terrible slum landlords, well in many cases they are terrible, but oftentimes it starts where they just don’t get their rent payments. And most if not all of these projects are leveraged and they need to make mortgage payments, and if they aren’t collecting their rent they can’t make those mortgage payments. You’ve got to have a discipline about making sure people pay rent on time.

We’ve also had very good luck, where we’ll find a property that’s in disrepair and has been neglected as far as the management, or maybe the right management techniques haven’t been used and they’ll have problem tenants. You’ll have tenants that are selling drugs, or they’ll be having gatherings in front of the building and will harass other tenants as they come out. We have found that with the technology that’s available now, if we put up camera systems, generally people behave properly if they’re always on camera in the common areas. When somebody breaks a window we know who broke it. When somebody steals furniture from the lobby, we know who stole it. When somebody comes in and commits a crime on the property we can generally trace when they come in and when they leave. So we had very good luck of just getting better behaved people living in our properties. Because all people want to live in a nice property that is well maintained, and if you allow people that don’t care about that to move in you’re not going to be able to do that.

So that’s one of our initial steps, is to spend the money on camera systems, spend the money on common areas; just the general condition of the property, the street appeal of the property is very important. People want to see landscaping and green grass and nicely maintained shrubbery and lighting and everything should be well lit. You cannot have a full-time security force, it doesn’t work at the level of rents that we run at. But we’ll have — particularly when we’re turning a building around, we’ll intensify security to a certain level and if somebody is on site that’s causing a problem, generally we can have security there in pretty short order.

 

John Carney: Well, that’s basically a long — for the listeners that are out there that want to be in the multi family game, or anyone who’s struggling managing their own multi family, take note of what advice Mike has given us. Because that’s generally, I would imagine, almost a weekend course in property management and multi family all wrapped into a ten-minute segment, so thank you for that.

 

Mike Gibbons: I’m happy to do it.

 

John Carney: That’s great advice, well we wrap this up with a few questions that we end up posting up on the show notes. But when you were growing up as a kid, you were also a college athlete, what sports were you into? And how did you see that team sport aspect of your childhood translate into success in business?

 

Mike Gibbons: Well, you know, I guess I didn’t appreciate how much participating in team sports — and some individual sports too — how much they helped. But I think it’s just a general attitude of being able to get along and work with people, where you have a particular function, they have a particular function, and when everybody’s doing what they’re supposed to do at the same time, things work a lot better. It’s that simple.

I played high school football and I wrestled. My father was actually a wrestling coach, I never quite achieved the level of capability that he would have wished. And I think he would have been a lot happier with me if I’d found wrestling to be my sport. But he was a great athlete, an all American national champion, and I just was never going to be that. And I also participated in track. And when I went to college, I really decided I wasn’t headed to the NFL, and although I had some looks by division one teams, I thought I was better suited — and again I wanted to stay around Ohio. The only D3 school I looked at transferring into, I waited so long to make my decision they’d already agreed to go to a school out of state. And ended up at a D3 school and was able to compete in three different sports while I was there and still go to class and maintain good grades. It was a great experience for me.

I played lacrosse and football in college. And the four years of football, and trying to compete in Ohio in football in a heavily academic school, where it was tough to get a lot of players to help this into the school. We were able to field a pretty good team. And a lot of those guys are still my friends and in each case they’ve all been successful — or I think all of them, I can’t think of any that haven’t been — but they’ve all been successful in whatever profession they decided to go in, and we often get together. We had an undefeated team in the college I went to, that was an unusual thing to have, it was the only one in the history of the school. And every one of those guys — we talk about how the coaches put us together and got us working together. We were always not as deep as the teams we were playing, as long as we didn’t have a lot of injuries we were going to do pretty well. We had people knew their roles and fulfilled them.

And it’s the same thing in real estate. It’s the same thing in investment banking. You have a job to do and you’ve got to do it as well as everybody else does their job, and it’s particularly important in real estate. You’re relying on the guys that vacuum the hallways as much as you’re relying on the people that are fixing the electrical problems or the plumbing, it’s all got to work together. And that kind of team atmosphere is the best situation you can create. And we have that right now and it’s not always that easy to achieve, you’ve got to have the right chemistry among people. But we’ve done it and it’s worked out very well.

So we’ve grown, and we’re one of the larger property owners in northeastern Ohio, and we intend to continue to grow in that area. I’ve got a couple of sons that seem interested in real estate, all of them are still in school, heading to law school and business school, but I think they’ve seen the fun I’ve had with it and the interest I’ve had in it, and I’m hoping one of those guys decides they want to follow and keep this effort going in the family. Like you’re doing John. Your family’s been in real estate for generations. I’m the first generation in mine.

 

John Carney: Right, and that’s just it though. It is fun. And I think it’s fun because it’s challenging, and it’s hard work and you get to surround yourself by other people that find it fun, challenging and are willing to put in the hard work. Three rapid fire questions before I let you go. We’re compiling a bit of a list. Who’s your favorite athlete – all-time?

 

Mike Gibbons: Well, it’s funny, because I actually know him, and this probably isn’t going to be a popular choice in Ohio. But my son-in-law, married to my daughter, played for Cleveland Browns, and so obviously, he’s probably my favorite athlete along with my father. My father was a world class athlete, just happened to be in wrestling. But my grandson’s godfather is a guy named Tom Brady. I’ve gotten to know Tom a little bit, and I’d consider him one of the — a guy with one of the finest characters — if you’re a Cleveland Browns fan, you only see this guy that comes in and destroys our team when he’s in here. I’ve gotten to know him personally and he’s kind of just a really great person. As is my son in law, as is my father.

So I guess I’ve got three of them. I would say: my dad, Jean Gibbons, and my son-in-law, Aaron Shay, and his big buddy Tom Brady. And I know each of those people pretty well, and it’s great seeing somebody in competition. Aaron’s not playing anymore, my father’s passed away, but I’ve heard the stories many times about how he competed and how good he was at what he did. And we can still watch Tom, usually in the super bowl every year. And for how much the fans of the opposing team seem to hate him, he’s really a great person and he’s a regular guy that just works harder than most everybody else.

 

John Carney: Yea, he works hard and he’s a leader. So I mean, two key ingredients to become a multi super bowl champion. Is there a favorite book that you have? We’re putting together a booklist out of this show.

 

Mike Gibbons: It probably is — I often say that there’s been a lot of books that have kind of shaped my — where I’ve ended up in life. When I was in 8th grade I read a book called God’s Gold about John D Rockefeller. I lived in a family that didn’t have a lot of extra dollars floating around the house, and I kind of set off to try to change my family’s trajectory, and I think I’ve done that to some degree.

But I can tell you what changed my whole attitude about politics. In college I majored in political science and economics, and just as most other college students, I didn’t read everything as carefully as I should have the first time I was asked to read it, but it’s become kind of a hobby for me over the last 20 odd years.

But a book called The Constitution of Liberty by Friedrich von Hayek, changed my world view. My grandfather was a labor union president, my dad, who was not really about in politics, pretended to be a democrat early on. I had a grandfather that was probably even to the left of that, my mother’s father. And I didn’t really form a political view really until after I was in college and got out of college. And I have to tell you, Friedrich von Hayek influenced me. It was a rational argument that really kind of convinced me that free markets and capitalism could change the world. It has, it’s taken more people out of poverty than any other system of economics in world history and that book changed my view.

I don’t read a lot of fiction, I read a lot of non-fiction and as my best friend says, “You read the weirdest stuff I’ve ever seen Mike.” But I think I’m curious, and I read a lot of things that aren’t best sellers. And it’s given me a great base of completely irrelevant and unimportant facts that I can talk about at length, and if you aren’t interested in that sort of thing I’ve got to be pretty boring. But it’s probably the book that changed my life.

 

John Carney: That’s good. And we’ll link that in the show notes on our website. Well we’ve run a little bit over. If you have a couple of minutes would you like to share your thoughts on your decision to enter into a big political campaign?

 

Mike Gibbons: Yea, and it took a long time and it was a decision that was very difficult to make. And I’ve said this many times, but I wish I could have found somebody with similar world experiences than me that would have been willing to run. My last son graduated from college a month ago, not even a month ago. My commitment to my children has changed as they grow up. I’ve got more time. I’ve got a son that graduated from Georgia Tech with honors in aerospace engineering, which if you know anything about Georgia Tech and having a degree in that field, he had great job prospects, and he went down and joined the navy and is in Pensacola now in flight training. And I think the combination of that and kind of having my last child graduate from college — I don’t need to focus on my kids as much as I used to. It got me thinking. And he’s adamant about wanting to help his country and defend his country, and I came to the realization that I’ve never really tried to do anything for my country directly. I’ve created hundreds of jobs over the years, and I’ve taken the risks necessary to create those, but I’ve never really given back to this country the way it’s given to me. And I’ve had — there’s been some opportunities, taken advantage of it that I hope everybody can have that same opportunity.

And I don’t like the direction our country is headed. I don’t like the politicians that we’re electing to office. I think we have too many career politicians who really have no experience and they’re very good at winning elections and raising funds to win elections but they really don’t have any day to day knowledge of what it takes to make this country thrive.

 

The government doesn’t create jobs, business creates jobs. And being a business man who recognizes his own capabilities and is not just out for some kind of an ego trip, that really wants to ensure that our governments can use the principles that made our country as great as it is, and not forego those and pick up on the latest ism that’s out there, the latest cause that somebody comes up with. And really kind of keeps the country directed where it’s — in a direction that’s gotten us where we are right now. And I’m going to try and do that. I promised my wife and my kids I wouldn’t change one iota. I tend to be blunt, and I don’t — I’m not a political soundbite guy. And I want to take that kind of an attitude. I’m going to try to get to Washington and actually tell the truth.

Because this country is in a very serious predicament right now: we’ve got national debt 105% of our GNP. The only time it’s ever been greater than that was after we fought a world war. And the difference is the end of that world war we hit 50% of the industrial capacity of the world. We don’t have that anymore. We have got to grow this country. If we don’t grow 3 or 4 percent over the next many years we’re in serious trouble. We’ve got to address that and there’s ways to address that that our politicians just don’t want to talk about. And they may have the soundbites, they really haven’t developed an argument and understand why we have to do that. Because right now we have enough debt that we’re either going to have to default on it, or we’re going to have to grow the country so that becomes a less significant portion of the GNP, that debt. Or we’re going to have to inflate our way out of it. And the very people that won’t allow this country to grow are the ones — the people that they’re claiming they’re protecting and representing. And they’re going to be the ones that are most hurt in that inflationary environment, if that’s what we end up doing.

 

But we’ve got to grow the country. I think I know how to do that. I think I know how businesses are formed. I think I know what stands in the way of their prospering. And I think our government has to ease off on those businesses. I think we have to lower tax rates for businesses and get people to create jobs and make sure that those lower tax rates are tied to people that are really taking risks of job formation. And if we do that, we can super charge this economy and we won’t head down the path that so many countries have that have tried this kind of foray into socialism. It doesn’t work. It hasn’t worked, ever. And they keep saying, “Oh well if we do it right..” There is no right way to do socialism. And even if you want equality in a country, you’re not going to have freedom. And I think that freedom and the fact that everybody gets a shot at opportunity here is what we need to make sure it continues in the future. I’m going to try and do that. And that’s really why I’m doing it.

I’m not a career politician, never thought about it before. If I could have found somebody better to run, I would have certainly supported them and would rather help them in their quest for office. But I can’t find anybody because they aren’t willing to take the considerable risk that comes along with running for office. And I just said –you know, they can make up stories, or they can come up with something they somehow will twist in my background that will make — try to make me look unacceptable to the voters, but I’m willing to take that shot. I think I’ve never done anything unethical in my business career and I’m proud of that, and I’m willing to take anything they can come up with because it won’t be true. So, long story short, I’m doing it because I can’t find anybody else that has my experiences to run and to support. So I’m going to do it myself. I’m the one that complains, I might as well take a shot. That’s what it comes down to John.

 

John Carney: There you go. That’s the American story. I wish you nothing but luck in your race for the US senate Mike. Alright, well that wraps it up. Thank you for joining me in the locker room today Mike. Where can the audience find more about you if they want to reach out or contact you online?

 

Mike Gibbons: Sure. Well I’ll give you our firm website is: bglco.com and we’ve got a good bit of information on there. We’ve been around for 28 years, just found out that we are among the top five most recognizable names in middle market investment banking in the United States. I’m very proud of that. They said it couldn’t be done in Cleveland; we managed to put it together and do it. And then my website for my campaign is: gibbonsforohio.com

And we’ve only been at this a couple of weeks, so positions aren’t filled out, but there’s a video on there that will pretty much summarize what I’m about. And I hope the listeners watch that because it’s — I want to be that new politician that our founders envisioned and not the career politician that unfortunately we’re forced to vote for now. We really have no choice because those are the only people that are running.

 

John Carney: Get in, get the change going, and then hand it over to the next generation. There you have it folks, I am sure that you picked up some actionable advice today from Mr. Michael Gibbons. Make sure to check out the Real Estate Locker Room Show on iTunes, Stitcher, or Google Play and hit that subscribe button to ensure that you never miss out on the pro tips from our great guests. The post-game report show notes, links and additional content for this episode will be available on my website: johncarneyonline.com/podcast when this episode is live next week. And while you’re visiting the website, feel free to drop your email address into the newsletter sign up form to receive even more real estate investing insights, tips, tricks, hacks and other good stuff. Remember to stay focused on your goals, have fun and stay in the game. I’m your host John Carney and until next week: work hard, play hard, and profit hard.

One more time, thank you very much Mr. Gibbons, for taking the time out of your busy schedule and your campaign to join us. Have a great day.

(Music Out)

End Audio

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JC 013: Positive thinking and flipping 100 deals a year with Geremy Heath

May 31st, 2017 | no comments
Systems are the key to a successful house flipping business

Geremy Heath is the owner and director of Texas All Cash Home Buyers. A native Australian, Geremy studied Civil Engineering at the University of New South Wales. After completing his degree, Geremy worked internationally as a management consultant for twelve years. While on assignment in the USA, Geremy met his wife Melanie in San Antonio, Texas and decided to stay and live in America.

Geremy and Melanie founded the company Texas All Cash Home Buyers that specializes in the all cash purchase of single-family homes. Texas All Cash Home Buyers has successfully flipped over 250 properties to date and have the goal of achieving 100 flips this year.

Geremy is a great believer in the power of affirmations and positive thinking and shares his thoughts and beliefs on how to be successful in the real estate business.

Five key points

  • When establishing a flipping business, you need to become an expert in all aspects of the business yourself: from marketing to raising capitals, to project managing and sales.
  • Good systems are essential in home flipping business. Defining what tasks need to be achieved in order of priority and having thorough checklists for each stage will streamline the processes.
  • A good team requires a good coach or mentor to guide you and teach you how to build your skills.
  • It is essential to invest in yourself, particularly when starting out in the real estate business. Finding and investing in an experienced mentor will help accelerate your path to success.
  • Having a morning ritual involving meditation, affirmations, visualizations and exercise is the best way to kick start your day. Long term, this practice will support you in achieving your goals.

 

Favorite athlete: Muhammad Ali

Favorite quote: “Whether you believe you can do it or not, you are right.” Henry Ford.

Favorite books:

  1. The E-Myth Revisited by Michael Gerber
  2. “The Law of Success” by Napoleon Hill
  3. The Miracle Morning” by Hal Elrod

Success tip #1 – Know how to manage these three constrains; Deal Flow, Capacity, Capital. When one constraint impedes progress you must focus on removing that constraint.

Success tip #2 – Develop a morning ritual to begin each day right.

Thank you Geremy for taking some time out to share your insights with us.

Reach out to Geremy and his team on: www.texasallcash.com or email Geremy direct at geremy@texasallcash.com

Facebook: https://www.facebook.com/texasallcashhomebuyers/

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at http://www.johncarneyonlie.com

POST GAME REPORT: Episode Transcript

The Real Estate Locker Room Show with John Carney

JC 013: Positive thinking and flipping 100 deals a year with Geremy Heath

Announcer: Welcome to the, “Real Estate Locker Room Show” with John Carney. Did you know investing in real estate is a team sport? Join John and his guests as they explore the business of real estate and athletic competition. The goal for this show is to grant you direct access to the real estate pros that are closing profitable deals and growing their businesses. On the “Real Estate Locker Room Show” we are getting in the ring with successful investors, developers, operators, and all of the industry professionals to learn what it takes to achieve on-going success. Now it’s time to kick-off and level up with new ways to grow your real estate business.

 

John Carney: Welcome back to the Real Estate Locker Room Show. I’m your host John Carney, coming at you today from Cleveland, Ohio. We are in the post season here, the Cleveland Cavaliers looking to repeat. Joining me from the great state of Texas is Geremy Heath who is the owner and director of Texas All Cash Homebuyers, which he founded with his wife Melanie in 2009. Texas All Cash’s primary focus is the redevelopment of single family homes in the San Antonio area. Since starting his business, Geremy has flipped over 250 properties and currently has a goal with his team to complete more than a hundred rehabs this year. Originally from Sydney, Australia, Geremy moved to the US in 2006. Prior to real estate he worked as a management consultant for twelve years, specializing in process improvement, and earned a bachelor of engineering, civil engineering degree, from the University of New South Wales in Australia. Welcome to the show Geremy, how are you doing today?

 

Geremy Heath: Yea, good. I’m doing good, thanks for having me.

 

John Carney: No worries buddy. Look, this is going to be great. I’m really interested to hear how you capitalize on your process of improvement for flipping and rehabbing a hundred properties this year. That’s a large number and a great goal. But we like to kick this show off with a little question to stretch out and get the conversation going. You’re from Australia. We’ve had a couple of Australia guests.

Is there a favorite athlete that you looked up to when you were growing up, watching sports? And if so, how did this person influence you in your athletic and business career?

 

Geremy Heath: There’s quite a few Aussie cricketers and Aussie rugby players that I looked up to, but if someone was to ask me now, “Who’s your favorite athlete of all time?” I’d probably have to say Muhammad Ali. The thing I love about him is that he was always saying affirmations: I’m the greatest, and I guess he ended up realizing that through believing in that at the beginning, so I’ve always respected that in him.

John Carney: Yea Muhammad Ali—great athlete, great champion, warrior and influencer. So, you didn’t start off your professional career in property. Will you talk to our audience a little bit about how you ended up in the United States and what drew you into real estate?

Geremy Heath: I originally came to the US in 2006 on a work transfer actually, and I’ve been bouncing around to a few different parts of the world doing my management consulting. America was a place that I really haven’t spent a couple of years, and I’d like to go deep there and really understand more about the culture and the psyche. So when I first came here my plan was to be here for a year or two with my job and then head home. But I met my wife, who’s from San Antonio. She was actually working with the same company at the time, and within less than two years we were married. So, by 2008 we were married and we’d bought a house and then I kind of realized, man, it looks like I’m staying here for a while.

John Carney: Right, the wife and the mortgage led you to believe that you might not be going anywhere soon, huh?

Geremy Heath: Yea, so that was almost ten years ago. But, after living in the U.S. for the time that I have, I’ve got nothing but love and respect for this place. I would say to people: there’s nowhere else in the world where you could come and be here such a short time and start a business and have the opportunities that I’ve had. And one thing that I really love about the American culture and the people is that through my whole process of getting started — and a big part of our business is raising capital, getting private funds to fund our deals — I never once had anybody question, like, “you’re Australian, you’re not from America, why should we do business with you?” I was always greeted with open arms and I think Australia and America are similar in a lot of ways. But the one thing where I do think America trumps Australia is probably just in the overall positivity and openness that the people have. It’s a very open place to people from all cultures all around the world.

John Carney: Right. I believe that in the American market, whether you’re in real estate or tech, if you’re in business and you’ve got a good idea and you show that you’re committed to it and you’re going to hustle a little bit and you’re willing to put in the work, the rewards soon follow. And with this show, my intention is to be able to get people who are interested in real estate, or are looking for a way to grow their asset base and cash flow outside of work. Not everybody can quit their job and become a full time real estate investor. But there are great opportunities out there for people to put their money to work for them. Other options are real estate versus shares or investing in a business. So, you have one of these businesses, and I’d love for you to share with our audience what you do and how you’ve been successful in applying systems that you would have had to use and implement in your civil engineering career into turning houses over for a profit.

Geremy Heath: Yea. In my old business career when I was doing management consulting, I studied civil engineering, but I actually specialized in supply chain management and BPO (Business Process Outsourcing) when I was working with my previous employer. So, I had a big system and process focus. Particularly in the second half of my career, in the outsourcing world, it was really about factories. We’d set up the call centers, and things like that, and it was really about having inputs that go into the factories; having the processes which can turn those inputs around and produce the outputs that are needed. So, I kind of thought of flipping houses as exactly the same thing. And I thought for me, my factory is my ability to rehab a house. The inputs or the raw materials that I’m having for that are houses that need repairs. Then my output is going to be a retail property that’s high quality, and that I’m going to be able to sell to a bank or qualified buyer. So, with that kind of mental model in my mind, the next thing that I kind of thought is: well, if that’s my factory, what are the constraints? And I boiled it down to three simple things: you’re either going to have a constraint around the flow of deals that are coming in; you’re going to have a constraint around your capacity in the factory to rehab the deals; or you’re going to have a constraint around the capital that you need to actually fund the deals. And I guess ever since I first started, it’s always been a balancing act, and it still is to this day, between those three constraints and one of them is always the constraint. So, whichever one of those three is constraining you, you need to put your focus into removing that constraint and then the next one of the three will kick in. It’s kind of an evolutionary process.

John Carney: That’s a different way of looking at the same problem all real estate investors eventually face on any level, right? The constraint that popped into my mind, the capacity, and that for me, thinking about it, goes hand in hand with capital. So, I’m a big proponent of the team, especially if you’re just starting out in real estate and you want to be an investor, and the team changes depending on the type of deal and the size of the deal. We’ll talk about that. But can you talk to me a little bit about how you started in a new country, in a new industry? You had a great background in management consulting. How did you go about recruiting your team, what did that look like initially and how has that evolved?

Geremy Heath: Yea, for sure. I think probably one of the things that a lot of people who get into real estate don’t realize is how much of a team sport it is. I know that your book has a title along those lines, and I couldn’t agree more. And one of the areas that a lot of people do get into is flipping homes—the single-family homes, because it seems like it is a little bit more accessible to people. But what they don’t realize when they get into it is that, if you want to set up a flipping business, when you get started you’re wearing all the hats, you have all of the different components of a full business to run and they all have their own complexity. So, you need to be able to be an expert at marketing to get the deals in. You need to be an expert at raising capital to have capital to do the deals. You have to be an expert at project management to be able to find the contractors and manage them. You also need to learn about the realtor side when it comes to selling the houses. And so, there’s really so many aspects to it, and when you’re trying to do it all by yourself, it’s a lot to learn and a lot to take on. But it’s definitely a passage of entry that everyone has to go through. Because before you can step up and start to hire people and build the systems for people to come and do the work, you need to really become an expert of every single one of those areas. If you don’t first master each area, there’s no way you’re going to know who to recruit, what system they need to run, how they’re going to operate and work for you, and then how you hold them accountable to a certain standard.

John Carney: So, it sounds like a familiar story that I’ve heard. You’ve really learned by doing. It’s the only real way to go from flipping that first house to flipping a hundred houses, right?

Geremy Heath: Definitely. And I think a book that, in the beginning — because I love listening to audiobooks and reading books — and one book that really had a big impact on me early, was The E-Myth Revisited. A lot of people are probably familiar with that book. But one of the big things it taught me is that you have to first be the technician in your business, and once you’ve mastered that area, you then need to be able to systemize that area so that you can then hire somebody in and have them run the system for you. And so, sometimes also people hear the word ‘systems’ and they think, “Wow what are systems, what am I going to do?” And for me, systems 90% of the time come down to having a good checklist that really defines the tasks that have to be completed and in what order. And it sounds simple, but the magic is really in those checklists and getting them right for the different parts of business.

John Carney: Right. And so with the challenges in flipping, I would imagine that every house is similar and then slightly different at the same time. What are some of the most recent challenges that have stressed your system, where you’ve had to say, “Maybe we need to rethink this,” and then you tweak it a little bit and it becomes even better? Have you experienced that recently?

Geremy Heath: Yea, I think a common area in single-family homes when you’re flipping them that people have a lot of frustration with is when it comes to the sales side. You’ve done the hard work to do the marketing, get the deal, rehab the deal, and then you’ve got the house for sale and you’re really in the last mile of the race, but sometimes it can feel like the most frustrating. And the reason for that is that the end buyer who is going to get his inspection via a home inspector, and they’re going to give you a 30-page report of all of the deficiencies in the house, when you feel you’ve already put all your money into remodeling it. These home buyers are most of the time first home buyers. So, you’ve got to understand from their perspective that it’s a big decision and when they do get these thirty-page inspection reports it does freak them out. And so, I when I think back from the very beginning to now, we’ve really put a big focus on quality. So, our goal is to really minimize the amount of deficiencies that would come up in a report, and we’ve done that through implementing vigorous inspection processes when we sign off on a rehab. And then once we get a contract on a house, before the property inspector goes out, we have another inspection, we call it a pre-inspection, where we send one of our internal guys out to re-inspect the house before the inspector gets there because we’re trying to drive a real high level of quality. And so, the end result of that is a smaller inspection report, and a happier end buyer. And I think one of the biggest tools that we’ve used over time to continue to improve that, is our signoff checklist that we use at the end of a rehab. For example, there might be electrical issues that keep coming up in our inspection reports. Then if we see it repeating, we would put it in as an inspection item in our signoff checklist. And that checklist keeps growing and growing, but it improves the end quality over time.

John Carney: That sounds like a really good system that you’ve put in place and it makes a lot of sense to me. So, I want to continue on with Texas All Cash Homebuyers. What is your business doing for an investor—for someone who wants to invest with you. You’re buying properties with all cash. We can call them distressed, whether they’re distressed financially or distressed situationally or people just don’t want to live there for whatever reason. Is that correct? And then you’re remaking them, remodeling them, and the end user for the finished product is going to be a permanent home buyer as opposed to an investor. Is that what you see the majority of the time?

Geremy Heath: Yea, that’s 80% of our business. And I guess our value proposition is that we have cash and can close quick, so there’s no inspections and additional financing approvals or anything needed. So, if somebody’s looking to sell a house quickly, we can close in as little as three days. And then we’ll rehab them and put it onto the MLS and sell it the traditional way. But it’s a remodeled home that’s being purchased by a bank qualified buyer.

John Carney: And so your team is really servicing two groups: making your investors happy, which is important, and your end users happy, right? I mean, they go hand-in-hand. So, would you talk a little bit about how you run your team and how you can accomplish that so successfully?

Geremy Heath: Yea, absolutely. I’m down here in San Antonio, so quite often with my team I use the analogy of the San Antonio Spurs. Luckily for me they’re a great team, they’re very well coached and well managed. The thing I love about the Spurs is they’re not necessarily a team of individual superstars. It’s the collective team that makes them great. So that’s kind of why I like sharing that analogy with my team, because I feel that in real estate everybody has a different role to play. And it’s not about having a team of people that are all experts in one area, it’s about having the right skills across all the areas. But the magic only comes together when the team is working well together. And I’ll say to the team, “We need to be passing the ball and moving the ball and communicating and working together as a team.” When you see the Spurs playing at their best, that’s what makes them great—the way they move the ball and the way that they work together. When we can do that in real estate, that’s when we really can exponentially increase the results that we get. And something that I always say to my team is: if you took us all individually and we went off to create our own flipping businesses, the results that we would get combined is nothing compared to what our collective results are as a team, because that’s when the magic comes together, when we can specialize in an area and help each other to reach the end goal.

 

John Carney: Great analogy, that definitely resonates for me and our listeners so thank you for sharing that. What advice would you have for someone who is listening and wants to get into house flipping or wants to scale their house flipping, going from something they’re doing as a side job to a full-time job, which is a scary step. What’s the best advice that you have for taking your business to the next level or just getting into it?

 

Geremy Heath: I think a huge element that’s helped me with my success is to have the right coaches and mentors. Think of it with the sports analogy. Popovich for the Spurs is arguably one of the greatest basketball coaches of all time. They’ve had sustained success over the last fifteen years or more and he’s a huge part of that. And so, when we look at sports, all great sports, whether it’s an individual or a team, there’s always great coaches that are involved with the athletes. So, when it comes to your personal life and your business life, I think I’d put a huge amount of weight on having good coaches and mentors around you to really help guide you in the right direction and help you find where you need to build skills, and maybe also where you’re strong.

 

Real estate can be a lonely game if you’re just out there sitting in your home trying to put a business together. So, get connected with the right coaches. And also, something else that I’ve consistently done is I’ve connected into good mastermind groups where I’m actually with others that are like me. So rather than being like a coach that’s maybe coaching me, it’s more a group of peers, and we end up coaching each other. That’s been a huge thing that’s helped me to accelerate my success.

 

John Carney: Did you actively seek a mentor when you made the decision with your wife that you were going to pursue this as a career? How did that unfold?

 

Geremy Heath: Actually, it started like it does for a lot of people. It just started with a few books, an interest, and a few books in real estate. And then there was one book that I’d read and it talked about the importance of a mentor. The light bulb went off in my head, and I’m like, “Man, I got to go find a mentor to help me with this, somebody that’s already done this before.” And I came across a guy who flipped more than 300 homes and now he was a professional coach. I probably dumped 10 or 12 grand to get started with him, but it was money well spent. And since then I’ve spent tens of thousands, it could even be in the hundreds of thousands now. It actually is, on coaching and mentoring, but it is the best money that I’ve spent, because it’s really the one thing that has helped me to grow quickly. Much quicker than I would have if I’d just been by myself.

 

John Carney: Thank you for sharing that. I agree and think that’s an important message which I’m happy that you’re echoing. We can stress again that you have to invest in yourself, right? That is a capital commitment, but the results speak for themselves, don’t they? You don’t become an overnight success in the real estate game, but if you just keep plugging away, you get there. Awesome stuff.

Well I’ve got a few questions here that we call the fourth quarter questions that I’d like to throw at you. What sports did you love playing when you were growing up, or that you still play today?

 

Geremy Heath: When I was a kid, my brother and I used to love dirt bike riding back in Australia. I now do the milder form of that, now that I’m an adult, and I’m into mountain bike riding. Probably a little safer. Arguably it’s a little safer, but maybe not.

.

John Carney: I don’t know. I mean, I’ve fallen off both. So if you like speed, you’re going to eventually go over the handlebars. Maye that’s just me. We talked about books. I think this is an important message, that we’re coming up with a great book list here by conducting these interviews and producing this show.

What is your all-time favorite business book or sports book that you’d like to share with our audience?

 

Geremy Heath: My all-time favorite book by a long way is a book called “The Law of Success” by Napoleon Hill. And everyone’s familiar, or most people are familiar with his book, “Think and Grow Rich”, but actually not as many people are familiar with the book “The Law of Success” which was the precursor to “Think and Grow Rich.” The specific book that I really love is the original edition. I think it’s from 1925, and that was really the starting point of his philosophy. The way that book is structured is that there’s 15 lessons to go through, or 15 laws. I’ve read that book probably 10 times, and it’s very foundational in a lot of the ways that I think and act.

 

John Carney: Ok. Perfect. We’ll have that linked and listed in the post-game report. Can you tell us about a success habit or a practice? You’re a very analytical and systems oriented businessman. Is there something before you step foot in the office, or after you leave the office for the day that you do to kind of help you along in this journey of being a successful real estate person?

 

Geremy Heath: Absolutely. I would say probably one of the most critical habits that I’ve developed over the years has been my morning ritual. And there’s actually another book that I model a lot of what I do in the morning. It’s called “The Miracle Morning.” And for me, I spend about an hour, at least an hour every morning going through a series of exercises. I start with some meditation and then I’ll do some visualization. I’ll review my goals. I’ll go over some affirmations. I’ll do some reading and then I’ll finish it off with some exercise. Including the exercise, it’s normally at least an hour and a half. But what I’ve learned is that if you make the time, that morning routine really sets up your whole day and sets up your whole life when you compound it. You keep doing it continually. It’s so important that you just have to set the clock as early as you need to make time for it. For me, I like to get up at [4:30]. I don’t always do it, I’ve got to admit, but I like to try to get up by [4:30] so I can knock out that hour or hour and a half before everyone gets up and I start the day off right.

 

John Carney: So, do you have children in the house with you?

 

Geremy Heath: No, that makes it a bit easier maybe.

 

John Carney: Ok, I got you. Because we have a one-and-a-half-year-old, actually her half birthday is today, it is easy to be up. Having kids trained me to get up earlier. And then as a result of that I found myself waking up earlier to get the exercise and the other things in. So, the morning ritual, I would imagine, puts you in a pretty good flow state or zone and prepares you to start your day. Correct?

 

Geremy Heath: Yea, absolutely. And if I ever have times where I get out of that routine, the first person to tell me to get back into it is my wife, because she can definitely see the difference.

 

John Carney: That’s great. You’ve got a business partner who knows you well and can help keep you on track. So, with all this being said, we’re getting ready to wrap this up. Is there a quote that you ever fall back to that keeps you motivated? There’s a lot of motivational quotes out there these days on Instagram, I kind of like the athlete struggle quotes myself, but is there anything that you think about when things aren’t going your way, you’ve got to get something done, there’s a time crunch and all these things that happen when you’re flipping a hundred homes?

 

Geremy Heath: I think probably one by Henry Ford, which is a pretty famous one. “Whether you believe you can do it or not, you are right.”

 

John Carney: That’s a good one. How does that resonate with you?

 

Geremy Heath: I’m huge on mindset, which is a big reason why I invest so much time on that morning ritual, but it’s really something that was taught to me from my first mentor in real estate. He was really big in that area, and I guess what I’ve learned with 100% certainty, I’d even say one million percent certainty, is that your thoughts are your future. And so, when I think back to when I first started in real estate, every milestone that I’ve hit with the growth of my business when it was all started is that it was a thought in my mind. So probably a couple of years into the process of building my business, I’ve started to realize how powerful my thoughts were, and so I started to set bigger goals and try and have bigger thoughts. Because I started to understand if you can believe it and you take the action and you have full faith that it will be realized. Then it’s only a matter of time until that happens. And that’s why I like that quote from Henry Ford, because if you think it’s going to be hard, then it’ll be hard. If you think you can do it and it’ll be easy, well then, it’ll be easy.

 

John Carney. Thank you for diving into that one a little bit deeper for us and thank you for taking your time out to join me in the locker room today. Where can the audience find you to carry on the conversation? Are you on social media? We definitely want them to check out www.texasallcash.com. And where else do you live online where people might be able to reach you directly?

 

Geremy Heath: You could also check out our company Facebook page which is @texasallcashhomebuyers and then my email address is: geremy@texasallcash.com

 

John Carney: Cool. Well there you have it folks. I truly hope that you picked up some actionable advice today from Geremy Heath. He is the director and founder of Texas All Cash Homebuyers. Make sure to check out the Real Estate Locker Room Show on iTunes, Stitcher or Google Play and hit the subscribe button to ensure that you never miss out on the pro-tips from our guests. The mission here is to help you elevate your real estate game. If you like what this show is all about I’d be grateful if you would leave us a five-star review on iTunes, or your preferred podcast platform so that other like-minded real estate investors can find us online wherever they look for their podcasts. The post-game report show notes, links and additional content related to today’s show will be available on my website: johncarneyonline.com/podcast. And while you are there, feel free to drop your email into the newsletter sign-up form to receive more real estate investing insights, tips, tricks, hacks and other great stuff. Remember to stay focused on your goals, have fun and stay in the game. I’m your host John Carney and until next week, work hard, play hard and profit hard. Thank you one more time from Texas All Cash Home Buyers. Thank you Geremy.

Geremy Heath: Thanks a lot, thanks for having us John.

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