[00:02] investment team from scratch. You can buy the perfect rental property in the perfect area of town and still fail. Not because the numbers were off or the didn't have the right people in your corner. Real estate investing is a team
[00:18] sport. You cannot do everything yourself. And you probably don't want to either. Whether you're investing in your own backyard or thousands of miles away to stay in this game, you need people that you can actually trust. So today,
[00:32] blueprint for building your own real estate investment team from scratch. There are four core players every investor needs, plus an often overlooked fifth member that could give you the biggest benefit of all. We've heard
[00:46] burned by bad contractors or ripped off by property managers. But stick around and we'll show you exactly how to find the right people for the job, keep them, and leverage their expertise to fast track to financial freedom.
[01:06] Washington and I'm here with my co-host Dave Meyer. Today we are talking about how to build the team that will help you be a successful real estate investor. members of your team, the agent, the lender, the property manager, and the
[01:22] contractor, plus a bonus plus one. And we're going to talk about where you can find these people, how to evaluate these people, and how important we believe they truly are to your team. So, starting off with the agent. Now, we
[01:37] mean is investor friendly real estate agent because all of the things I'm relying on them to do require them to have an understanding of how real estate have an understanding of how real estate investing works, not just buying and
[01:52] selling real estate in general. >> So, you have some pretty good tips in my opinion on like how you determine if a real estate agent is a good investor-friendly real estate agent. You care to share? Yeah, I got all sorts of
[02:05] stuff that I've done in the past, but I think the frame of reference you should use when evaluating an agent is kind of simple. Do they know more than me about this market? Like, can they teach me something about real estate investing in
[02:20] this area that I don't know? And Henry and I have been investors for a long time. We have our own expertise, but I'm not an agent. I don't know what's selling at what price bands, how much people are selling, what the right bid
[02:35] strategy in certain neighborhoods are, what finishes or features that you should have to command the best resale price or the best rent. And so when I go to a market that I'm considering investing in, I try and ask like really
[02:49] Like I tell them a little bit about myself, say, "I'm Dave. I do passive investments. Here's my budget. Here's the stuff I've I'm thinking about. Here are my priorities. What would you do if you were me?
[03:03] >> And I'd say 80% of them can't answer that question. >> Any good, experienced, investor-friendly agent will be like, "Okay, Dave, you're kind of similar to these three other clients I've worked with. They're
[03:15] succeeding in these neighborhoods with this asset class at this price point, and I think you could fit in there." Like, that to me already gets me warm to those kind of people. And and I think uh that is like probably the most helpful
[03:30] like a lot of more logistical questions, like can I be a better investor because they're on my team or not? >> I'm just looking for like do you have an understanding of a what kind of exit
[03:43] strategy it is I'm talking about and where within your market do you think where within your market do you think that this would potentially work? or if I tell you something about my buy box or about what I'm looking to do, like I
[03:55] also want to hear, have you thought about maybe going over here after I've how you're wanting to make money? Because now you're putting your your market expertise, and you're marrying that with my buy box and my strategy and
[04:10] areas of town as well." Once you do that though and kind of assess their ability to get your mindset, there are some specific things that you should probably specific things that you should probably look for. a deal flow is high up there
[04:25] because anyone can look at the MLS, but a good investor friendly agents will have either their own offmarket deals and pocket listings or will know someone
[04:37] who does direct to seller marketing and can arrange meetings, has networks with can arrange meetings, has networks with wholesalers. like that kind of deal flow super super valuable because investing is competitive and especially if you're
[04:50] investing out of state like coming in as a new person and be like I'm going to find great deals on the MLS from 10,000 miles away probably not but your agent can. That's super important. >> I also like putting this person first
[05:03] because if you find a good investor friendly agent they're typically going to have a solid network and they're a great place for you to build out the >> Yeah. because they should have lenders that are great on speed dial. They
[05:16] managers are in the market. They should have contractor relationships or know relationship. So, it's a great place to get started building your team. >> One last thing cuz this one grinds my gears when agents can't do it.
[05:30] >> It's like you got to understand what rent comps are too. Like that one is like sometimes like what's rent? They're like oh let me ask someone. Like come on. You got to at least have an idea. give me a ballpark.
[05:43] they have access just like they have access to run sales comps. So, a good resource not a lot of people are using. But in the same vein as access to data, I like that my agent helps me keep a pulse on what's really happening. So
[06:01] being able to understand that yes, we have 3,000 homes listed for sale right have 3,000 homes listed for sale right now, but for our area, we need somewhere close to somewhere between four and 5,000 homes on the market to satisfy the
[06:14] demand. Meaning, we're still at a place where if it's listed and it looks good and it's priced right, it's probably going to sell. The other metrics I like going to sell. The other metrics I like that my agent helps me with is number of
[06:29] offer. >> I love that metric. You taught me that >> Yes. It gives me a little more peace of mind than just average days on market. I metric. If I know on average nine showings equals an offer, now I'm
[06:43] thinking, well, what can I do with my listing that will increase the amount of showings that I can get? because the more showings that I can get gets me math problem. >> Like, do you just track that yourself or
[06:57] >> Yeah, my agent tracks it. Yeah. >> That's awesome. What about other things? Are there any like red flags with agents that you have? >> Yes. Uh I'm a big communication person. >> So, I need an agent who's willing to
[07:11] communicate with me in the way I need to be communicated with. So, I like to be communicated with. So, I like to dictate that on the front side. If you back within a reasonable time frame, it's it's not going to work for me. The
[07:24] amount of business that I am potentially sending to this agent is a big deal. there [laughter] >> from possible teammate status. >> So, I just dictate that on the front
[07:38] somebody, like I say, hey, this is how I need communication. If you can't you run your business the way you feel like you need to run it. We just upfront communication style conversations are hugely important to
[07:53] >> I got some red flags. >> I bet you do. >> I bet you do. >> One is the uh overly optimistic appreciation number. That to me signals you probably
[08:07] work more with primary residence buyers, which is totally fine. But like the hey just buy this and you'll build equity over time and it'll appreciate and it's a great investment like that's not good enough. And then the second one maybe
[08:19] it's more of a green flag if they do it right. But it kind of bothers me when a agent sends me a deal and hasn't done any analysis themselves. [laughter] >> Right. It's like oh here's a property. I'm like well I could have looked
[08:35] I'm like well I could have looked that up too. [laughter] sell it to me a little bit. Not in an overly optimistic way, but why should I What about it is good? What caught your
[08:50] eye as the agent that separates this from something else? So, if you can't do that, I guess that's a red flag. Also, >> you want an agent who's put some thought into what it is that they think you
[09:03] need. And so they're trying to deliver what they think you need, not just, interested, I'll make a check." >> Yep. There's an agent I've been talking to in Chicago does a great job of this. Every week, she sends out a list. She
[09:16] looks at every onmarket deal that comes on, every new listing, and evaluates them all for cash flow and opportunity and value ad and sends out a list of all that's a great agent. That's a great investor-friendly agent. I will double
[09:30] check all those numbers. I will check the neighborhoods, but like you have spent time thinking like an investor on every property that came out this week and now you're making it easy for every one of your clients. That's a good
[09:42] >> All right, so before we move on to our next team member, Dave, where do you think a good place to find investor friendly agents is? >> I got two. First, beggarpockets.com/agent.
[09:57] We can connect you with an agent for free. really great investor friendly agents there. Second one, I don't know if I've even told you about this yet, but at BPCON, we're doing a team building networking event this year.
[10:10] It's going to be really fun. We're going to do like a regional thing where we're going to get like property managers, lenders, agents, and investors all in it up by different individual areas. >> So, you're going to like build teams in
[10:23] >> Yes. Building teams in the room. It's going to be super fun at BPCON this tickets are still available. Go to biggerpockets.com/conference biggerpockets.com/agent. But these are free ways to build your
[10:38] we should have mentioned that too. >> Talk to a couple no matter what. Even if or four. Get a sense of different people's personalities and flavors. So, those are great ways. >> Pockets.com/agent for the agentfinder.
[10:52] because I actually used it when we did the first Cash Flow Road Show to find an investor friendly agent in the markets we were going to to help show us properties. It worked like a charm. I had investor-friendly agents calling me
[11:05] immediately. Second place, title companies, underused resource. Call a real estate transactions all day. They know exactly who the investor friendly agents are because they see them at the closing table selling deals or helping
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[12:25] to baselane at baselane.com/bp. All right, moving on to the next team member we're going to cover, which is the lender. This is the money. I think important team member, but that's just probably because they don't know where
[12:39] they're going to find the money to buy these deals. I think the lender is the door. >> Sorry, lenders. find a bank. They probably want to lend you money as long as your deal is
[12:51] decent. But it is important because you need the money. And there are so many different types of loans. Yep. >> And I think where investors screw up is they don't understand >> the different nuances of what different
[13:06] >> the different nuances of what different loan products provide and how to marry the loan product to the deal that they're buying is where people struggle. We talk about quote unquote lenders and sometimes you are actually interfacing
[13:19] with the person whose money it is. A lot of times as an investor you're actually talking to a broker who is just arranging the loan for you. The money is coming from somewhere else. So it's a lot more about the personal relationship
[13:32] >> and their ability to walk you through products because they're not really the kind of a concierge helping you find the right product. And so if they're not anything. So like that's where I really concentrate my time.
[13:47] >> The things that you need to think about when you're looking for a lender to help when you're looking for a lender to help you to be on your team is understand your financial situation. How much cash do you have available to put towards
[13:59] buying a property? Different loans have different down payment requirements. They have different fees. They have different interest rates. So, you need to understand like what's your cash position and how much of that cash are
[14:12] you going to allocate towards putting down onto a property? That's going to differentiate which type of loan you might use. Uh, and then just understand the different parts of the underwriting that a lender does. So the more you
[14:27] understand about the different parts of underwriting, the more educated conversations you can have and the more you can the more you can start to understand like the language of the lender and what they're saying. So go
[14:39] and learn what amortization means and what the different amortization periods are. 30 years, 25 years, 20 years are very typical. Go and study interest
[14:51] rates. Know what they are and what loans tend to have what interest rates. It is not the lender's job to explain that to you. They they probably will try, but like as an investor, it is your job to know how loans work.
[15:05] >> And number two, and I might piss some people off here, it is also not the lendable. >> That is your job. [laughter] So the other thing about lenders is like every conversation with lender is going to go
[15:18] >> if you have money and good credit like [laughter] and good deals. Like it's >> that's the thing honestly to focus on cuz then finding a lender once you got >> Absolutely. Every lender will want to lend to you if you've got some money in
[15:33] you're buying a phenomenal real estate deal. That is the best way to find money >> And that is in your control. Like I'm not saying everyone has a ton of capital, but I'm saying like going for a loan that you have money for. So, that
[15:48] dollars in the bank, but if you're going to go for a house hack, do you have 10% so you can cover closing costs and everything? If so, that conversation is to be a problem. If you go in there and like, I have no money. How do I buy real
[16:04] because they're going to probably give you some hard truths about your prospects of buying a deal. So, I I think a lot of people think lenders are superheroes and it's like if you have the right pitch, you'll get the loan.
[16:18] It's like it's pretty rigid. They have criteria. They have standards. And yes, there are fringe cases where you could shop around from different things. But finding good deals, being credible, having a track record, those are the
[16:31] >> And when selecting a lender, the things that I'm looking for are communication and customer service. I think this gets very confused and I think lenders are some of the people that get confused about this and that is that your lender
[16:47] about this and that is that your lender is the service provider. you are the customer. And often times we as the borrower treat the lender as if they're doing us a favor and that we need to jump through all of these hoops and do
[17:03] whatever they say so that they may please give us the monies so that we may go buy a night you >> right and it gets very confused because they they yeah they hold the dollars and you think I need the dollars so I'll do
[17:15] whatever they ask. That is not the way this relationship works. You are the prize. >> Oh, thanks, man. [laughter] >> You're very welcome. Especially if you are buying a good deal and you have a
[17:28] decent credit score, right? Like they want your business. Yeah. So, try to find a lender who is willing to communicate with you and help you want you to understand a lot of these things going into it, but if you're
[17:42] they're bothered by having to explain these things to you, like you're wasting their time, like they don't like you're >> Move on. They're everywhere. You want one that is it sounds like they want to
[17:55] things to you. They seem like they want your business. Great. And then again, communicate with you the way you want to be communicated with. If those two boxes explain their loan products and you're smart enough or have enough done enough
[18:10] loan make sense for the deal that you're buying, I think you can find yourself a lender no sweat. Literally not a problem. And lastly, if you want to find investors are always a great place to start as well as again a title company.
[18:26] closing real estate transactions. They are literally reading through lender mortgage stocks on the daily. They know who good lenders are. They know who bad never want to work with. They know which ones have good interest rates. Great
[18:40] company about what lenders are lending in the area. Now, we're moving on to the illustrious property manager, which is a very important team member. But it's not just a team member you can hire and then
[18:54] set it and forget it. This is somebody who's going to be operating your business alongside you. And I feel like this is where investors lose a ton of money. They hire a property manager and then everything just happens inside of
[19:07] going on. And then all of a sudden they look at their P&L at the end of the year money." Well, >> you didn't manage your property manager. >> Yeah. I have I think I have just two pieces of advice here. The first one is
[19:21] how big are they and how important are you to them? And I know this sounds a >> No, this is important. >> It It is right. It's like I've worked with large property managers and I'm a small fish to them and then they
[19:36] rightfully spend all their time on their big clients. If I was them, I'd do the same thing. I don't begrudge them for that. But that doesn't work for me. So, I need to find a property manager who I am important to. And that usually means
[19:51] am important to. And that usually means a small to midsize boutique, sometimes a small to midsize boutique, sometimes familyun, sometimes new property manager trying to to get up and running. And that comes with tradeoffs. You know,
[20:03] You know, there there's there's trade-offs to that. But for me, that is maybe the most important thing because managing your property manager is super important and setting clear expectations is important. And if it's a giant
[20:18] to do it this way and they're like, This other person is 600 unit. We're doing it their way. >> It's a little bit different. The second thing is sharing a philosophy about
[20:31] property management. I know you and I have talked about this a lot, but I am a long-term investor. I think a lot about maintaining my properties, being proactive about maintenance, being proactive about tenant satisfaction,
[20:47] proactive about tenant satisfaction, being proactive about communication. being proactive about communication. And if they can't do those things, I am out, heart out. Because to me, the hardest thing to find in a property
[20:59] manager is proactive maintenance and proactive tenant satisfaction. >> Yeah. someone who thinks ahead and says that's going to break. I need to fix it now before it becomes a problem. It's a hard thing to do when you're managing a
[21:11] is a hard thing to do. Even when I self-manage, it's a hard thing to do. that at least, and they'll miss things, but like trying to do that super important. Same thing about tenants, listening to them, realizing,
[21:26] understanding if they're satisfied or not satisfied in the unit, if they're not, trying to come up with a solution because I want to keep tenants and I because I want to keep tenants and I want a property manager who cares deeply
[21:38] about the tenant experience and that they're happy in their home. Yes. Like Yeah. >> And when I talk to property managers about that and say that to them, they're like, I love that, but every owner is
[21:52] interesting for me to hear because I kind of assume people are more like that. But those are kind of like deal breakers for me. >> No, I think that's great. I've I've told you before, one of the reasons I really
[22:04] liked my property manager and selected him is because when they talked to me referred to the tenants as tenants. They always referred to them as residents. They wanted them to enjoy living in their residence. They weren't. I feel
[22:20] connotation sometimes with the word tenant, like somehow you're less than >> I hate that. >> Absolutely. It's it's it should be no negative connotation around it. We don't have a business without them. And so, I
[22:32] like the way that they just kind of set the tone with even how they refer to the >> Totally. >> Good property managers are hard to find. find them. You're probably going to go through two or three of them uh before
[22:47] you find one you really like and then that may not even last forever, right? So, the highle things that I'm looking for are how are you incentivized? Are you incentivized for the wrong things or the right things? In other words, a lot
[23:00] of property managers say that we keep all the late fees. >> Ooh, no. No, no. That tells me that you're incentivized for people to pay late because if they pay late, there's an additional fee and then you keep that
[23:12] >> Yes. >> No, that's not that's not how I want my business to be set up. I don't want you getting paid more when my tenants pay late. That's absurd. >> 100%. And like a good property owner,
[23:28] someone's late, you should have a conversation with them. Why are you late? Figure something out. If you're making money off the late fee, you're be like, "All right, I made some money, which just puts the tenant in a bigger
[23:42] >> late fees are not a revenue stream. It is a It is not a revenue stream. That sucks. I don't like that. >> And the same thing with turnover, right? So, this is a nuance thing. This is why you have to ask your property manager
[23:57] how they make their money or what dollar from your tenants goes to who for a from your tenants goes to who for a turnover. If you have a property manager turnover. If you have a property manager who gets paid more money every time they
[24:12] >> Yep. >> Then they're never incentivized to help you have long-term tenants because they don't make an additional lease up fee >> when a tenant moves out. So, in other words, your property manager is
[24:26] incentivized to turn tenants out of your unit. And tenant turns are the biggest cash flow killer there is. >> Probably because property managers charging one month rent to lease up a unit is the worst deal in all of real
[24:40] estate. It's so bad. It's I mean, you can find ways around it, but I hate incentivizing them to have turnover every year. They make more money than keeping tenants. It's terrible. You can't have that. And I I've found better
[24:55] property managers will have a renewal bonus where they get a little bit of payment for keeping it. >> Love that. I will pay you to create >> Yes, >> you get money. I win because the tenant
[25:09] >> The tenant wins because they're staying in a unit they like. You win. You'll get manage a turn. Like >> let's incentivize that behavior. >> Yes. You want property managers who are incentivized for things that are
[25:25] they win, right? So, they're incentivized to help your business to run more effectively. That's the scenario that you want, not the >> Incentive alignment with all of your team members is is just so important.
[25:40] >> If you hire a property manager, you've evaluated them, you think they're good, job. >> Give them a leash. Get out of the way. >> Stop trying to stop trying to bring in your guy to go do all the little fixes
[25:55] cuz it's going to save you 20 or 30 bucks here or there. Let them hire their faster. They can get the unit turned faster. Yeah, it might cost you a hundred to 200 bucks more than if you hired your guy, but they're going to be
[26:08] showed up yet. >> Put yourself in their shoes. Just imagine I'm the property manager and Henry hired me and he's like I trust you Dave to manage my units and then every time I do something you get second
[26:20] guessed on it to to to save it and it's going to totally disrupt my entire process and the thing that I do for all of my units which might be 300 units and Henry's are 30 of them. That's not a trusting relationship. Like the trust
[26:33] has to go both ways and if they aren't meeting your expectations that's a different story. But like you have to know that by hiring a third party, you are not going to have the most efficient cost structure ever. And that's okay.
[26:47] That's kind of the point of hiring someone else is you're you're hiring it out. >> All right, here we go. This is the one. This is the one that I wish I knew more about before I got started. Good
[27:00] contractors are hard to find. Contractors can be hard to keep. Again, it's this relationship you have to manage over time. There are literally thousands upon thousands of dollars tied to these things. And here's my general
[27:14] to these things. And here's my general take. A lot of contractors are good wrench turners and not necessarily the best business people. And I think that that's where a lot of the the hangup comes in. So with contractors,
[27:30] where have you had the biggest struggle? >> I have had struggles with contractors all over the board. Yeah. But I think that the thing that really breaks down is when there are unclear expectations of scope. I think is like probably the
[27:44] biggest thing where like you think you've communicated something clearly. timeline, >> but there's some disconnect. >> Between what the contractor thinks is
[27:58] going on and what you think is going on. And then everything just melts from everything falls apart cuz you're pissed cuz things are late and it's costing I did what you said. >> And like I'm sure there's mutual blame
[28:11] feel like the the challenge is. >> Absolutely. That's 100% uh where my head was. It is uh expectation versus reality. And I've just learned the hard
[28:23] reality. And I've just learned the hard way over time that you truly have to document as much as humanly possible. If it is a brand new contractor relationship and you are new to investing, like get as much down on
[28:37] paper as you can because when you're brand new, you don't know what you don't know in terms of managing a renovation and expectations on what you think it end of a project versus what that contractor thinks they're supposed to
[28:50] deliver to you. So like you kind of have to go overboard for your first couple of projects in terms of like overcommunicating to your contractor about what work you think needs to be done. And so the way I typically handle
[29:03] done. And so the way I typically handle this is I will write out a scope of work and often times I'll say, "Hey, I got a budget of X." Now I may not be telling them all of the budget that I have cuz I don't want them to use it all, but your
[29:15] contractor should have some guide rails around what money you have to spend on >> But I agree with you. Don't say it all of it. >> So if I've given them a budget and I've given them at least a highle scope of
[29:28] work, often times what I ask of my contractor is to say, "Hey, this is the budget that I have. This is the scope that I have. Help me understand what I'm
[29:40] missing through the details of this." Cuz I could say, "Yeah, I want to spend, you know, $5,000 on drywall." they're going to know, well, Henry, you I looked at this house. It's 2,000 square feet and every room needs new drywall. This
[29:55] isn't even close to enough. And so all the little nuance things that I'm not thinking about, like that's where I need them to help me with the bid. And so if you're brand new, I'd give them a highle scope of work and then you give them the
[30:07] budget and the guide rails and then say, what is it that I'm missing in this [clears throat] get this done? uh that's just going to help you understand how to future. Um but it opens that line of communication between you and your
[30:21] >> And do you use this to like evaluate people when you're selecting them? Like you you're giving the full scope of work to people before you hire them. Yes, that is a secret I learned as a newer investor because what was happening was
[30:36] I was inviting contractors out to look at a property and a project and I'd talk it, but then they'd get there and I had I'd either have one of two things. They'd get there and they go, "This is way more than I'm comfortable doing."
[30:51] their time and then I still had to go get another contractor out there. Or opposite. They say, "This isn't enough. like this is too small of a job. I'd have to charge you too much for me to make this worth my while. Yep. And so
[31:04] for now, I do a highlevel scope of work. I don't get down to the details. I'm not counting screws and nails. I'm just saying room by room in this room. Paint floors, trim in the kitchen, new countertops, backsplash, and light
[31:20] fixtures. And like it's super high level, room by room what I'm wanting to do. And then I send that up front and say, "Hey, I got a project 123 Main Street. Here's the highlevel scope. Would you be willing to come bid this
[31:32] scope of work and be like, "Yeah, this is absolutely something I'd be comfortable doing." Or, "No, I don't want to touch this with a 10-ft pole or this is too tiny for me. I'm too busy." And then you save yourself a lot of time
[31:44] >> Yep. Absolutely. That's great advice for how how to select them. >> Yeah. I got to drop some some hard truth on the audience here though about finding contractors. There's no trick. There's no secret.
[31:57] >> There's no secret. There's no secret to doing Sorry. >> There's no magic bullet. This is just part of the job where you grind. And I sometimes I feel like we talk a lot
[32:11] about systems and process on the show, as we should. It's super important. But there are some areas of the business where you just got to put in some effort and finding contractors is just one of those areas. It's a it's 100% a
[32:24] relationship game. James has given good tips about he pulls over on the side of that's that's great, >> but ultimately it's about managing a relationship and then >> honestly the best way to find a good
[32:36] contractor is find one and then they'll know all the other good contractors. So know all the other good contractors. So when you find one, treat them like gold. pay them on time. I tip contractors sometimes depending on the situation,
[32:49] but if they do an exceptional job, I tip them. Then they pick up my phone the know a plumber?" They're like, "Yeah, I know a great plumber." And I'll tell them that you tipped me, so they're going to call you. You know, like don't
[33:03] nickel and dime a great contractor. Like that's the game. And it's similar to flow. This is a lifelong thing. It's part of the journey of financial independence and real estate investing. It just if you if you're unwilling to do
[33:16] properties and invest passively. Like this is just part of being an active >> And it's not just finding them. It's keeping them. And one of the best ways a fair wage for what they're doing and pay them quickly. The sooner you pay
[33:31] prioritize your jobs and your phone calls if they know when Henry calls, he's going to have work and I'm going to get paid as soon as that work is done, call, they'll do the work and then they're chasing them for three or four
[33:44] weeks trying to get paid. And then you have to manage that contractor relationship going forward because oftent times what happens with me is I'll have a good one. They're doing good work. I'm paying them for them and then
[33:57] work. I'm paying them for them and then by job three to five I start to notice up. [laughter] They're just creeping up a little bit.
[34:09] sometimes >> it just happens. they think, you know, you're the guy with the money. You gladly paid me $3,000 for this portion of a job last job. It's $3,500 this time. You didn't
[34:24] see it. Maybe it's $4,000 the next time. You got to keep an eye on those things as to what they're charging and why. So, for me, if it's just communication, like I'll never tell a contractor, "Hey, I'm not paying you that for this." I'll say,
[34:37] "Hey, I saw you charged $8,000 for flooring in this house and two houses ago, you did one very similar square footage, same flooring, and it was about six grand. What was the difference between those two?" Right? And they're
[34:51] make something up or they're going to say, "Hey, I'll adjust that price." "Oh, you're trying to gouge me on my prices. I'm not going to work with you anymore. Adjust the price and let's keep it moving. If not, then I'll find
[35:04] But you got to pay attention to those things. So, I'm telling you, I've had working with me, they were driving the F-150 and by job five, I was like, don't [laughter] >> you right. Like, this is this is my
[35:19] >> you right. Like, this is this is my truck. the bids. Track it. Ask questions. It's not rude to question a bid. If your contractor makes you feel like you're a butthole for asking them about the bid,
[35:35] you need to move on. >> This is just you'll learn. Just don't be thing. It's like it can be intimidating. Contractors know their business. So like probably going to come at a disadvantage of knowledge about what things should
[35:51] cost. The only way to get better at that is volume. Just take some reps. Talk to 20 of them. Talk to five plumbers. talk to five HVAC people, you will start to talk to other investors and what they pay for things like that. That's how you
[36:05] really start to understand what the real value is and whether you're willing to pay a little up for higher service or better timing or better communication. You want to go the budget route with caution, but just like that's that's how
[36:18] do it. >> Air on the side of overcommunication always. And then keep all of your bids whether you go with that contractor or not. Every contractor bid is data to help you get smarter about how to even
[36:34] needs and how much it's going to cost. So if I were you, I'd keep all your property bids. I'd load them into Claude or chat GPT and have it break each section down and try to give you like a cost per square foot for every trade and
[36:49] just keep that as a running uh data set that you have so that when you get more compare it to the other ones and say, "Hey, in comparison to the contractor bids I've given you in the past, does this seem high? Does it seem low for
[37:03] paint? Does it seem low for flooring? Does it seem high for flooring?" If you're keeping track of all those bids, AI can help you better understand not just how to evaluate what a rehab costs, but to validate a contractor's bid.
[37:16] >> Great advice. I like that a lot. >> All right, before we wrap this one up and give them the the final bonus, where do you like to find contractors? For me, I found my best contractors. My the best contractor relationships I found is
[37:29] literally through other investors, recommending good contractors and through driving for dumpsters, finding people on a like I found roofers and plumbers and cabinet guys, just going to jobs and talking to them and seeing if
[37:42] relationships >> Yes. >> Again, networking is by far the best way to do it. The other way I found good
[37:54] the pro desk at like Home Depot or Lowe's which which contractors they for you. but should we do the bonus? >> Yeah, let's do the bonus. What you got?
[38:09] >> All right. I just I'll say this quickly. I just think finding people in your own area that can help you give you feedback. Yes. >> Maybe even give you contractors deal flow so important. I'm going to give you
[38:22] a little bit of advice about this. I think the ideal mentor or person you should target is two years ahead of you in your investing journey. I think a lot of times people reach out to me all the time, want mentorship, want to go grab a
[38:37] beer, talk about deals. I like doing that stuff, but if you're brand new, my frame of reference, not because I don't want to help, I just like can't help you that much. Like I I I am doing different things in my career at this point. And I
[38:52] am not the best person, but someone who just did their first house hack or just did their first burr and are moving on to their second one. That's someone where you can offer mutual benefit. And those are the relationships that are
[39:05] most valuable is where you can help each other. Like I want to help someone and tell me about a great contractor that they work with, you know, something like that. I'm not asking for that upfront, but you want to be close to this person
[39:18] in terms of your goals, your stage of investing. You don't want to shoot the moon. And I think I think a lot of people miss that. And the best way to do and biggerpockets.com. Go to biggerpockets.com. We have millions of
[39:33] people on there that are trying to do this meetups, BPCON, that kind of stuff. doesn't have to be the perfect person. Just someone you enjoy talking about super valuable. You know, I'd call him almost an accountability partner because
[39:46] then the help that Dave's asking for it just kind of comes naturally. If you meet an investor, you vibe with them. You're doing similar things. Maybe but they still have some experience. >> Yeah.
[39:58] on a call. Let's talk about what we're working on. 30 minutes and move on. Just establish that relationship." And then in those conversations, that's when you at A, B, and C or 1, two, three. What do you think about this? the relationship
[40:12] that you have with other active investors can literally save you so much money. And just having someone with a different set of eyeballs look at your different set of eyeballs look at your deal or listen to what your strategy is
[40:26] have done something similarly or they know somebody that's done something similarly and what went well and what didn't go well. Like this can be a friends don't do this. You need some investor friends, accountability
[40:39] partners that can give you a temperature check on deals or strategy or maybe help I'll find something that could be totally profitable but would derail me
[40:51] from my goals or strategy which are there because they're leading me towards a lifestyle that I want real estate to provide me and not just chasing the here even though it might make me money. Is it the best use of my time? Is it
[41:05] things. >> It also just makes it more fun. Like, real estate investing should be fun. It's And as Henry said, it's lonely. Having a buddy who does real estate with you makes it all more fun. And like the
[41:20] can you stay in the game? And if you can make it fun, you can stay in the game a whole lot longer. So, find a way to make it fun. It doesn't have to be all your friends. I you've probably heard me rant about how I hate that thing about your
[41:34] only have friends who are rich. I hate that. But have some friends who are investors. Like I think it's helpful to have that part of your peer group and it's some of the more rewarding relationships I have in my life. I've
[41:49] great. >> That's very true. Present company >> H yes. [laughter] Best friends runs forever. you so much for chitchatting with me about building a team. Hopefully, you
[42:02] guys found good value in this. These are all team members that Dave and I have hired, fired, and hired again. So, hopefully you can learn from our experience and go out and don't be
[42:14] something that you, if you're going to be successful, you're going to do it anyway. So, hopefully this will help you do it more effectively and efficiently. Thank you so much Dave for sharing your inputs and thank you so much everybody
[42:27] next episode of the Bigger Practice podcast.