Small Apartments, Club, And Mastermind with Robert Orfino

TRE 27 | Single Family Apartments

 

Here’s the problem: Single-family real estate investors, as a whole, will be out of this business in the next five to seven years in Houston, in Dallas, and Fort Worth. That’s just the reality. If you’re not learning the small apartment business right now, you’re going to be out in five to seven years. In this episode, Jason Bible and Robert Orfino talk about their small apartments and Airbnb webinars, as well as their club and mastermind. Many make the mistake of attempting to tackle their large business goals on their own, but the key to success is finding a peer-to-peer group of like-minded individuals, also known as a mastermind.

Listen to the podcast here:

Small Apartments, Club, And Mastermind with Robert Orfino

Don’t Take This On Alone

We had a wild day. I was on my way with you to go meet a banker in Clear Lake when I got a call from my boy, Curtis, there and said, “What time will you get in here?” Actually, I could hear this noise in the background. I go, “What are you doing?” He goes, “Taking a shower and talking to you on the phone.” I laughed. I was like, “I’ve done that before. No big deal. Phones are waterproof.” It’s nice. He goes, “What time are you getting here?” I was like, “Getting here for what?” He goes, “We’ve got the podcast.” I’m like, “I thought it was Thursday.” I called you, “You’re going to have to run point on this thing.” I literally do a U-turn on NASA Road 1 and then head back up here and we get started. We had Eddie and Rob on there from Jet Lending, a fun little event we do at the first Tuesday of the month at D and T Drive Inn. It’s very much industry insider, the cool kids in high school. We just sit at the back of the bar and hang out. They got good burgers there. We had burgers after the show was over.

I got something coming for Eddie and Johnny. That was a surprise. It should be here.

I didn’t ask him about shirts. I should have.

Where are our Jet shirts?

If the Jet boys are listening, I need a Jet collared shirt. We need Jet polos. We’re going to start hitting all of our sponsors up for free shirts.

We’re going to do the sponsor things. I think we’ll start hitting it and do the live reads to start talking about it. There was four or five people once we started and said, “We’re interested in sponsorship. If you’re interested, now’s the time to have the conversation.” We have the stack and what we’re going to do. I think for sure it’s different than everyone else and provides a ton more value. We’re not looking for sponsors, what we’re looking for are marketing partners. We want you to be a marketing partner with us. That’s who we’re looking for.

Speaking of which, I’ve got a meeting with one of those folks. It’s going to be so much fun. You have no idea what we’re doing. This is going to be so great. 

Let me put this number out here because at the beginning of the show I always forget, it’s (281) 401-9008. We’ve got a mastermind. We’ve got classes, focus groups and the business line of credit workshop. I think there are a few seats left. If you’re interested in any of that stuff, our Airbnb, our small apartments, our buy and hold mastermind is $7,500. Our focus groups, we actually have the single-family buy and hold focus group done. We are finishing out the Airbnb one and you’re going to start small apartments. Our membership, which puts us in our atmosphere and gets you start working with us. We have a phone call with a new member at 10:00 and we’ll just figure out where he’s at and walk him through the process. That’s $1,000. Any of these little six-hour webinars we do is $97 and we have about one-third of them recorded at this point. Once we have Infusionsoft up, we might have some organization here.

We got to the point, I was on the phone with Constant Contact for almost an hour. I was getting the corporate doublespeak. In the back of my mind I’m like, “We’ve got to buy Infusionsoft. This is nonsense. I am done with Constant Contact.”

Growing pains are part of the journey. Click To Tweet

It’s a big problem when a third-party company can dictate your business model.

I was worried about the Private Lender Summit because I couldn’t get emails out. For those of you who wanted to know about our Airbnb and small apartment and mastermind, some of you were hitting me up on text, on Facebook, on email. I’m trying to get the freaking email out and Constant Contact shuts down our account for some goofball reason. I’ve tried. I’m not a spammer. I’ve had account with you all for six years. In any case, we’re making the transition to Infusionsoft.

In the meantime, it’s (281) 401-9008.

Send us a text message and we’ll get it all sorted out. It’s so funny. I know you mentioned when you were chatting at the Private Lender Summit that a couple of folks have gone to all these different events. We’ve told them, “Go to other people’s real estate clubs. Go to their $97 weekends and go to their whatever it is, and they share with you some of the things they learn.” They said, “All these things are the same, their $50,000 coaching packages for how to buy a single-family house as a rental property.” I’m like, “Let me share with you how that works. Find something under $125,000 and go buy it on MLS. Here’s your $50,000 coaching package.”

I got a message, “Me and my wife went to one of those events. We were excited to get into real estate. When they hit us with the price tag, we just couldn’t afford it, not with a baby on the way. Now we’re starting a life together.” That was great and I appreciate it, that part of it. The second half of the message said, “I’m going to do wholesaling by myself to get started.” I’m not against wholesaling. We know very successful wholesalers. Your ex-partner, Tom, is probably the best wholesaler we know.

He’s the best seller in town, best flipper and wholesaler.

He’s fantastic at it. We’re not against it. You can make a lot of money. You can do very well. If you’re going to start, know that you’re going to need marketing money, you’re going to need, we say $25,000 for the first six months. Here’s the other thing. If you’re brand new, you’ve got to be aware because there are a lot of different aspects of wholesaling that are sold in those $997 packages, which lead to $5,000, $10,000 and $25,000 packages. The guy who messaged me, here’s my best advice if you want to start as a wholesaler. Go on iTunes and listen to Flip2Freedom by Sean Terry, who to me lays it out the best at-home start your business podcast about wholesaling. There are a lot of other ones that go deeper.

I’m going to show you lease options, but start right there. The next time that Mitch Stevens comes to town, take that day class. He’s a great guy, but don’t buy the big program yet. Don’t buy anything in those first six months. Just go ahead and listen to Sean. He’s going to have tons of products he’s going to try and push on you. He’s going to push that program on $2,000. They’re going to talk to you about access and membership. They’re going to want you to come to mastermind. That’s all in due time. In the first six months, BiggerPockets, Sean Terry, look for a guy like Mitch Stevens to come through town and then realize, do you want to do that?

I’ll add one more on there because they’re good in Propelio TV when Daniel’s on. Daniel is the owner of Propelio and I would highly recommend going to the Propelio.tv. They’ve got the whole YouTube channel and any of the stuff that Daniel does as it relates to wholesaling. He has a couple of videos he put up and they’re great. I will tell you right now, everybody who sells a wholesaling class lies about this one thing. This is where they lie. Wholesaling is the easiest way to get started in real estate. I’m like, “No, it’s not. No way.”

TRE 27 | Single Family Apartments
Single Family Apartments: In the eyes of the public, someone who is licensed sits head and shoulders above someone who’s not.

 

Becoming a real estate agent is the easiest way.

Be a real estate agent. If you get on my personal Facebook page, I did a little interview with a buddy of mine. He was a big Fortune Builders coach and one of the first Fortune Builders guys out there. He did that for years. He’s got a small portfolio. He’s flipped some houses. He said “Before I left Fortune Builders, I was 90% investors, 10% realtors. Now I flipped the script and I’m 90% realtor and 10% investor. It’s so much easier.”

If you have limited resources and you want to get started in this business and you know absolutely nothing, the best is to spend about $2,500 and become a real estate agent. I think that’s good because you’re going to have to put time in for wholesaling anyway. You’re going to have to find 25 hours a week, so why don’t you just do it in a structure that cheers and claps you on the back. Everyone has those Taco Tuesdays and Margarita Thursdays. Wholesaling is insanely lonely. That’s probably the loneliest bit of this business. If that’s where you’re going to go, if you want to get in this business, I’d say become an agent. If you decide, “This isn’t for me. I want to get into the flipping and all this other stuff,” that’s great but you have a rock-solid, fundamental understanding of this business for $2,500.

It’s not going to teach you the investing side necessarily of real estate, but you’re going to understand real estate law. You’re going to understand contracts. You’re going to understand real estate so much better than Joe Blow Wholesaler out there that by the time you decide to make that transition into full-time investor, there’s not a big gap there. 

I would say if you’re in Houston that you should come and talk to us about joining our at-large team. We have a team of agents who are not our core folks. They don’t work with us. We’re not telling them what we have to do every day. They’re just hanging their license with Keller Williams Platinum and they’re on our team and we ask for 10%. It’s not a huge fee.

You can always text and email us if you’re on the team, “I’m having a problem here. How do I do this?

Sit down with us and we can go through some investing and train you there. Anyone on our team can come to any of our Saturday classes for free. It’s a good deal.

It’s a good idea to get your license. I’m a big fan of being licensed. In the eyes of the public, someone who is licensed sits head and shoulders above someone who’s not right. I don’t care if that’s a wholesaler with twenty years’ experience, if they’re not licensed, you’re sitting across the couch from meemaw, this house that you’re trying to buy or list. If you are a real estate agent, it makes you look that much more professional. I can tell you the first time I ever pulled up next to a big block Chevy and I’m sitting there and it was a Corvette. It was a Sting Ray and it’s got this side pipes that come down the side. I’m sitting there and I’m feeling this. “Is it raining outside? Is there thunder?” He pulls up next to you and you’re like, “That is a monster.” They’re not that fast, but it’s just all that volume of that motor, pushing all that air. It’s like a motorcycle on four wheels. It’s wild. This is pretty cool.

Small apartments. Crossing our fingers, we’re almost at the start of our journey.

There’s no secret to the real estate business. It is still tenants, termites, and toilet bowls. Click To Tweet

The 27 units should close.

We have 13, the 27, 9 and 8.

George sent me a twelve that I’m going to look at. I think when we get back from the hunting grounds.

That all shakes out to be 65 under contract that we are close to closing. We need gap funding on one or two of them. We’re in this business now. This isn’t willy-nilly. We have a plan. We have a pretty decent property manager, which is critical for us. He’s chomping at the bit to get to those 65 units down there. It will be 53 for him. They’re ready to go. We got the right people. We know the marketplace. We are welcomed in the marketplace by Section 8. The affordable housing office likes us. We’re going down to the hunting ground and we’re going to have some conversations with bankers. We’re going to get that started. There’s no reason why we can’t do very well down there for the next year. Get our 100 doors down there and then be off and running.

I was chatting with Eddie and we were talking about all the major markets in Texas. I said, “Here’s the problem. Single-family real estate investors as a whole will be out of this business in the next five to seven years in Houston, in Dallas and Fort Worth. They will start in small multifamily and Airbnb. That’s just the reality.” If you’re not learning the small apartment business right now, you’re going to be out in five to seven years. You’re going to have to learn anyway. He said, “What do you think about the smaller markets?” The first one he lists is the one down in the hunting grounds. I said, “Eddie, we’re on track to buy 100 doors down there.” He said, “Really?” I said, “Yes. We’ve been down there for six, seven months now.” He said, “Interesting.” I said, “This is why those markets are growing.” We talked about some other markets. We talked about Waco, which I think is a sweet one.

I love any small market that has a refinery. I’m totally okay with Port Arthur, Orange and Bolt. That’s great. It’s a home run out there. I’m like, “All of Freeport? Great. I love it.”

I had somebody that was like, “Nobody’s worried about all those chemical plants and all that stuff over there?” I’m like, “Let me explain how all that works.” Trust me, those things don’t “pollute” because it costs them too much money. Not from environmental compliance standpoint, but from a product standpoint. I said, “The guys that work at those plants, they live right here.”

You should be more worried about pollution in the heights where there’s no zoning. There you can have a $700,000 townhouse next to a scrap metal yard. Imagine all the heavy metals and all this stuff that are soaked into the ground there.

My favorite is the wood lay down yard where they’re treating all that stuff with arsenic, “That’s Bob and they’re building 4x4s and they’re treating them.” The pallet guy. The dry cleaner is a big one. These big plants, I’m like, “I probably know half of those guys that work there.”

TRE 27 | Single Family Apartments
Single Family Apartments: Most successful real estate investors that are holding properties have relationships with banks. It’s hard money and there’s no easy way to do it.

 

It’s not the ‘70s. That stuff was cleaned up a long time ago. White smoke is good smoke, that type of thing. We’re looking at those small markets and obviously we’re aggressive, and we’ve got some growing pains that we’re dealing with. We’re taking the journey and you can appreciate the journey or you can wait five years until we decided we’re going to sell this for $25,000. In the meantime, you can come along on the journey and we’re working on this stuff.

Let’s talk a little bit about small apartments and the marketplace for small apartments. Let’s set the stage for that. Wall Street is in single-family. If you guys don’t know this, Warren Buffett opened his big fat mouth in February of 2012 and said, “If I could buy single-family houses by the thousands.”

He said, “If I could buy every distressed single-family house, I would do it.”

“I would do it if there was a way for me to manage it.” That’s when all these hedge funds and REITs for single-family started popping up. Apartments above 100 units, there are already a ton of REITs and hedge funds and all that that are buying those apartment complex. 

I know single-families because I sat on a panel discussion and the main economist for the Dow Jones was on the panel and it was brilliant. All these guys were portfolio owners. They are trading portfolios as small as ten houses. All those guys were basically going to go to the Dow Jones to have their portfolio rated. Once it’s rated, then we can go trade. I was on that thing and I’m laughing at all of them. I was like, “How many houses do you need?” One guy’s like, “I have 650.” I’m like, “What’s the point?” I went to Wall Street and was total California dude. I made a complete ass of myself. I don’t care. I’m like, “I’m going to get my 100 and I’m done.” One guy was proud that he had all the houses on highways. I’m like, “If you’ve got to run your business that way, you’ve got problems.”

It’s funny, I was watching this bond trader, they just sold the most expensive townhome in New York and I would say it was $50 million. It was 30,000 square feet with a big pool on the bottom. They said the renovation took multiple years. I’m like, “Why? Don’t you have anything better to do with your time?”

There’s no secret to this business. It is still tenants, termites and toilet bowls. I don’t care where you traded, there’s still a clogged toilet that needs to be dealt with. Let’s not pretend like we’re doing some high finance here. For us at small apartments, it’s the mom and pops of the world. They own those eight, twelve and fifteens and they inherited them. Usually we’re catching them on the second generation.

That’s where the real value is. Wall Street has already stepped into single-family and they’re in multifamily above 100 units. There is a secret market here between 2 units and 99 where nobody is playing. The professional guys like us are not playing in that market space yet. Wall Street’s going to figure it out. Look at it this way, if you can go into a market, buy a small apartment complex that’s 50% below market, that’s not going to last. We’re buying stuff at $0.65 all in on the dollar in an apartment complex in Houston, Texas. I think Katherine’s got another $1.1 million in real estate she’s making offers on another 30 doors.

The twelve I’m going to go take a look at that George has got. It’s like these deals are out there, but the reality is that they’re not going to be out there forever because the big boys are going to figure it out. The World’s Oldest Real Estate Guru is up. Captain Cashflow is up as well. You’ll notice there are not a lot of those pages, but those gentlemen will be here. Captain Cashflow and The Oldest Real Estate Guru. This is going to turn to the Phil Hendrie Show. I can already tell. If you’ve never seen the Phil Hendrie Show, it’s absolutely hilarious. This is the Phil Hendrie Show for real estate. 

There are a time and place for everything, you just got to have an open mind. Click To Tweet

We’re talking about small apartments. We’re talking about this market and it’s out there. Here’s the big issue, the financing is not taught. There’s no class out there that explains how you have to go to a local bank. Most successful real estate investors that are holding properties have those relationships with those banks. Usually the local bank isn’t sponsoring the beer and chicken wings. It’s hard money. The regular mortgage folks that are in that real estate world because it’s all single-family or one to four units. We move over to the five, eight, twelves and the fifteens, all the way up, then you’ve got to start playing. There’s no easy way to do it. There’s no 100% down on this stuff. There’s no 3.5% down, none of that stuff. It’s like, “We do 80% LTV. We do 75% LTV. We need at least 15% cash.” We’ve had conversations with bankers where we do 80% and at least 10% cash. We do another one that says, “I’ll do ground up and I’ll do 75%. I’ll roll the acquisition into the loan, but you’ve got to bring at least 15% cash.” You bring the other 10% a note but 15% cash. It’s all dollars.

For us, which makes this entry easier, there’s a little easy glide in this process for us. We get doors at $40,000. In our world, we are buying these doors between $40,000 and $50,000. They produce a 12% or 14% cap for us. When you get them that number and you can, you just got to work on it, then all of a sudden, if I have twenty units at $40,000, that’s $800,000. I need to bring $160,000. Usually we find an equity partner to come in for the $160,000 and that’s how we’re able to take down these properties. Any equity partner who understands that small multifamily space is like, “How much are you getting them forward?” “We’re at $40,000 a door.” “How much are they renting for?” “$800.” It’s like, “Am I the only one you’re talking to?” “You’re the only one we’re talking to right now.”

It’s hard to screw up when you’re at a 2% multiplier. We’re all in at $40,000 a door and it’s renting for twice that run a 2% multiplier. They’re like, “How many more have you got?” I’m like, “How many do you want?”

Most of the folks that are investing in us want an equity play, are coming out of those bigger classes. The folks in Dallas are here and they’re used to Class A, 6%, 7%, 8% caps.

I’ll tell you what it is. What’s been fascinating, there are some mature real estate clubs. Brad Sumrok has got one, Course Lifestyles, and a couple of these other national outfits that teach multifamily investing. They’ll foster an environment in which there are lead investors. These guys come through the ranks, if you will. They build their portfolio and there are all these equity partnerships.

They teach everyone that 6% cap is good.

Here’s the thing. When you get somebody, a handful of guys that are real rock stars, everybody subscribes to their deals. At some point they go, “Making $100,000 a month net. I don’t want to work that much harder anymore. I’m done and I’ve got my own money to do my own deals.” What I didn’t recognize is, and I’m recognizing it now with the deals that we’re doing with our equity partners, is that these guys are recognizing in us that they’re like, “You guys are going to be just like these guys, where in four or five years you all are going to be done.” They’re coming along for the ride. It’s funny. It’s like the second wave. They’re like, “We’ve already gone through this wave with these guys. They’re all crazy successful but they don’t need our money anymore and we’ve made a lot of money.” They see the deals we’re doing. They go, “It’s like 2008 all over again. You all go keep buying.” 

I did a Facebook Live because I had a conversation with our attorney. She’s great and she’s on lots of stages. Everyone loves her and she’s bar none the master of her topic. When it comes to syndication and crowdfunding, she knows what she’s doing. She said, “You guys are still bullish on the market out there.” We’re like, “We love it.” She’s like, “I’m not seeing it.” I’m like, “What don’t you see?” She’s just like, “I think the numbers are unsustainable.” I’m like, “That’s California.” She’s like, “What are you doing?” I said, “We’re doing small apartments. We’re doing Airbnb.” She said, “The only thing that I’m interested in right now is Airbnb and apartment buildings. The only place I’ll actually do them is Corpus Christi.” I said, “Are you kidding? Have you not been watching my Facebooks? Are you joking with me?” She’s like, “No.”

There was a crowdfund site and she put her money in and they bought 80 units down in Corpus. She’s like, “I’ve never been there, but I love that market.” I’m like, “You’re messing with me.” She was like, “No. What have you got?” I was like, “I have a small apartment in Corpus that I’m looking for an equity partner on.” She’s like, “Really? What else?” I was like, “I have an Airbnb at the beach.” She’s like, “Those sound good, Robert. I might be interested. I’m doing one of those. Just send me the details.” The problem is I’ve been busy so I’ve got to get it out. It was almost blown away. She said, “Everyone I talked to out here is pulling the money out of this market. We bought at 6% caps here, with the taxes and all this other stuff, we need to get out.” I was like, “Come to Texas.”

TRE 27 | Single Family Apartments
Single Family Apartments: Many people who are not teaching nor promoting Airbnb and aren’t lending on Airbnb have Airbnbs.

 

I’m on a couple of these different California groups. There was this guy that said, “I’m looking for some 6% cap Class C,” and the guy posted a GIF of the Back to the Future time machine. I’m like, “That is so perfect. I’m using that on every single one of these threads. You need a time machine for California.” I think they might have another three to five years and you can go back and maybe buy some distressed stuff there. That market is insane.

Tammy’s asking what deals we have. It’s easier if you text me at (281) 401-9008. I can tell you that the loans that we’re looking for are anywhere from at this point $50,000 up to $2 million. We also have a crowdfund, the 506(c). We have two of them. One we’re winding down and one we’re building up. If you’re an accredited investor at this point, the minimum contribution is now $100,000. We have those funds out there, but it’s easier if you text me at (281) 401-9008 and just put something like lending or investments and we’ll have a conversation.

We’re driving down the hunting ground. We’re going to spend at least five hours on the road. We’ve got a lot of windshield time, so if folks want to know more information, it’s a good time for us to chat on the phone. I think we already got one meeting at 10:00. There are lots of time in the truck.

We have a 9:00 to 10:00 meeting at Bucky’s. We pull in 9:15. I want to go through and say there are many ways to skin this cat called real estate investing. Scott Carson was on. He popped in Facebook and said hello. Scott, hopefully you’re back.

Someone’s actually working. It’s nice. Scott’s been gone for a month.

He’s like Bruce Wayne out there. It’s like he’s at the Acropolis, he’s at the Roman Colosseum. He’s at Stonehenge, at Disney. Anyway, there are many ways to skin these cats and we absolutely love single-families. We think single-family rentals work. We would prefer to see a two, three or four. There are some very good loan products out there that you can put in your name for us. We know that from the folks that we work with, we don’t want more than three mortgages in our name. We’ll save three quads for our personal loans through Fannie Mae. We’ll do that. We love Airbnb and we all want a couple of Airbnb’s to cashflow and keep it going. We love small apartments. It’s what we’re doing. We’re not buying any small apartments in our personal portfolio. They’re going into the business. We have a bit of a mindset where, “Jason, you get fifteen properties. Robert, you get fifteen properties.” It’s you and your wife’s names. Those are yours. When it’s time to go our separate ways, you’ve got those. We have an entity that’s a business. Mr. Texas Real Estate and a few other companies and those are buying Airbnbs. Those are buying small apartments. We have a fund where we’re about to roll a ton of duplexes in. We have an investment fund, our 506(c) that should have about $2 million in assets, maybe more that are producing about $400,000 a year.

I’ve got six duplexes already and they’re bringing in. We’re stabilizing two more and we’re under a million on those six and they’re bringing in gross cashflow of over $1,000 a door. It’s $12,000 a month. It’s probably closer to $14,000 a month just on the six.

That’s how we’re going to promote our fund by saying there are already assets in here that are producing a couple of hundred thousand dollars a year. You don’t have to wait. You don’t have to work now and this stuff is going. That was one of the failures of the other stuff that we’d done. We learned from it. We’re moving forward and creating a better fund. We’re into all of it. There’s a time and a place for all of it. It behooves you to just have an open mind to look at this stuff. I can’t believe how many people we have who are very high levels in his business who aren’t teaching Airbnb, aren’t promoting Airbnb, aren’t lending on Airbnbs but have Airbnbs. It’s because they’re open to it. The dude also owns 300 apartments and he’s got single-families. He’s doing this and he’s doing that.

You’ve got to keep yourself open for all this stuff and when the opportunity comes, if your mind isn’t open, then you’re not. You’re just going to miss out on a lot of stuff. I left California. It was pretty good living there. I had eight years of establishment in that market. I was the guy. I was you out there. People knew me every room I went to. I’ve spoken on a lot of stages, got on a lot of podcasts, did a lot of stuff, had a lot of opportunities brought to me. I said, “Forget all that. I’ve got to get to Houston,” because there was an opportunity in front of me and my mind was open enough. I was open enough to change to say, “I’m driving there now.” I made that decision and in 72 hours I was in the jeep driving. My wife’s like, “Are you really going?” I’m like, “I am going. I’m out. I’ll be in Arizona.”

Looking for lenders and investors is a hodgepodge. To most people, it looks like chaos, but chaos is okay. Click To Tweet

I know we’re going to save some of this stuff for Motivation Monday, but it is mind-boggling to me. If you’ve been doing the same style of real estate investing for the last 25 years, you’re missing out on some enormous opportunities right now.

If you’ve got 150 doors or 200 doors, God bless you. You don’t need to do anything. If you’re reading, what are you doing up? Go back to bed. It’s a rainy day. You have 200 doors. You have everyone’s permission in the world to crawl back into bed. If you don’t have a portfolio, you don’t have any of this other stuff, then it might be time to be a little more open and we’ll talk about that. We are always looking for private lenders and we are now looking for some investors. We’re working tirelessly. It’s all a hodgepodge out there. To most people, it just looks like chaos and that’s fine by us. Chaos is okay.

Even the sophisticated investors that we know, like you were having this conversation with Ashley. It’s like, “What is it all you guys are doing?” I’m like, “Trust me, there’s a plan behind this whole thing. In the next six to twelve months, all the madness will make sense at that point.” They go, “They’re building a fully integrated corporation.”

“You guys are building a corporation.” We’re not running it out of our living room.

You guys want to read a book about what we’re actually doing? It’s called The Value Chain. Go read it. It was written in the ‘70s. That’s exactly what’s going on. It’s a fully integrated entity.

Don’t be shocked if in a year from now we own a termite company. We own a Terminix franchise. It’s the value chain.

They’ll go, “Are you going to the termite classes and you’re like spraying for termites?” I’ve got 30 guys that do that. They just give me one of the green trucks to drive around. We take pictures in front of it for Facebook. Don’t be surprised if we ended up with a roofing company. Who knows where this whole thing’s going to end up? We do know this. We’re good at picking the places where there’s the most margin and the most opportunity for disruption for our style of marketing and sales in this marketplace. I know that’s a little high level, but it’s also the reason that we’re in small apartments. We realize that there’s so much opportunity there that a lot of people don’t see. They’ll see it five years from now, but by then we’ll be done.

There’s a whole bunch of guys that can pile on that truck because it’s hard to do foundation work in the rain or do the exterior paint in the rain.

That’s tough, evidently, “What do you mean? You can’t just put in like a big tent.”

TRE 27 | Single Family Apartments
Single Family Apartments: Pick the places with the most margin and the most opportunity for disruption for your style of marketing and sales.

 

There is a product you can roll on wet on a roof. You can roll it right there on the puddles. It doesn’t matter how long it takes us.

It’s chemistry.

We talked a little bit about small apartments. We think there’s a good market for it. If we’re picking up doors in these secondary markets for under $50,000 and we’re picking up doors here in Houston for $60,000 to $70,000, you’ve got something there. You’ve got value in there and obviously the rents are going to cover it stuff. We like it. We’re open to it. We’re not managing it ourselves or we’re not doing the repairs ourselves. I had actually put some tools back in. My favorite tool is a nail on a stick.

What’s the nail on the stick?

Go around and you hit things to see if it’s termite damage or water damage. That’s nail on a stick. Is this thing flaking? You poke the eaves and stuff, “We’ve got to replace this stuff.” Nail on a stick is my favorite tool.

I just had this image flash in my mind. There’s this episode of the Simpsons where Bart wants to be as big as possible and a flash-forward to when he weighs 1,000 pounds and he goes, “My goal is to wash myself with a rag on a stick.” I’m going to have to find that now. “With a rag on a stick.” You’re like, “That is classic.” I don’t know. I probably saw that episode fifteen years ago, but that’s what flashed in the back of my mind. 

We talked about small apartments. These opportunities are out there. We do have a focus group coming up and we have a mastermind that’s starting. Our first meeting of the mastermind, I think we got a third maybe already signed up, so four people in that mastermind. It’s so much better to be so straight up and say, “This is what you get. This is the cost. If you can’t afford it, I’m not going to cajole you into it or make you take a credit card.”

Come to the back of the room and sign up.” $7,500, you guys get all of our focus groups, our classes and plus our mastermind. $7,500 a year. Just send Rob a text message if you’re interested.

(281) 401-9008.

I did email everybody. I will check the Mr. Texas Real Estate email when we get to the hunting grounds. We’ll probably have lunch at that cool seafood place, maybe if we go back that way.

Guys, if you are interested, come along for the ride. Let’s talk, (281) 401-9008. This is all good. Next time, we’ll be talking a little bit about Airbnb.

 

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