[00:00:00] Niyi: Nate, how you doing man?
[00:00:02] Nate: Yeah, I'm heading home right now, but I was like today, I got a joint that don't work. Fair enough.
[00:00:11] Niyi: The last couple of weeks it's been, one-offs literally last four weeks. I've had one person each time. So it's almost been like a one-on-one session. It is. It's kind of cool. Cause you can get into the details and really talk through some things, which is awesome.
[00:00:28] But what we were talking about before, we never continued that conversation. Right. So this is good. You're going to have your money working for you in the background, but you also mentioned what in the pickup an investment property potentially.
[00:00:42] Nate: Yeah, definitely. I, well, I've never really wanted to purchase it as an investment property, but also wanted to most of my investment properties, I probably erected it first at the very first one I'm living in it right now, looking for the next point, you know, reasonable price range in a good location, just make sense, right? I don't want to purchase a property. That's going to be in terms of the mortgage is gonna be way higher than I could actually rent it out for. So yeah, so those are the things I'm looking at right now, but I'm on my path on purchasing the second property. And there's just really, I think where some confusion is coming into my mind is knowing the limitation of how much capital I have.
[00:01:22] Like after my second cap, after my second purchase is going to be very interesting to see, okay, where do I go? Do I keep doing this in the next couple of years, without any habits, an opportunity to accelerate the amount of purchases that you make just trying to get, and I remember me kind of talking to you, like, what's the best, what's the best path for that?
[00:01:40] Do I keep doing what I'm doing? Do I consider Airbnb to kind of generate more capital and then have an opportunity to invest in other properties just trying to get a direction, someone who's kind of. Ah,
[00:01:53] Niyi: man, we are all on this journey together. You know what I mean? So we're all still trying to figure it out, but just based on what we've talked about in the past I would opt for exactly what you're doing.
[00:02:04] If you're able to once a year, make that move, that's amazing. And then also put your money to work elsewhere one, two things. One, once you move out of this house and moving to the next one, you're going to be able to rent this house that you have out, you're playing to keep that house, right. That the economy that you have, definitely.
[00:02:23] Okay. So you're going to be able to rent that out. And after two years, you're going to be able to count that income. I think you're going to be fine usually it's I don't even try to think too far, like, Hey, okay. If I get this eight unit, how are they going to qualify me for the 16 unit a year for me? I wouldn't worry about that piece.
[00:02:40] There's you always typically find a way, right? So I would focus on getting that next property, which you're doing, and then we'll cross the bridge of, Hey, from a financing standpoint, what do we have to do to acquire the next one? When that time comes? I can tell you that. For me, I didn't hit that ceiling and I'm still actually moving along pretty well, but I didn't hit that ceiling and Louisville until I went to purchase something that was bigger than, you know, four units.
[00:03:06] Right. And that's when I had to figure out how to use commercial financing. And it's not that hard to, to figure out the financing piece for the different properties. Especially if you find a deal, the main piece is finding a deal and the best financing you're going to be able to get is exactly what you're trying to do, which is if you just go and live in the. And we talked about it before, right. But would you be open to living in say a duplex triplex or quadplex as your next purchase?
[00:03:33] Nate: Yes. I will be totally open to a duplex because initially when I was purchasing this very first part, That was my focus of what's trying to find one, but I wasn't lucky enough to get one, get one into my hand.
[00:03:46] So even on the second property, as much as I am looking out for new construction and things like that, and I'm definitely open to a duplex. Cause I think, from building that capital standpoint, that definitely would be the better option.
[00:03:57] Niyi: The nice, nice. Yeah. If we're able to find one of those, that's a quick way to accelerate even, and we talked about it before, but even a single family with an in-law suite. Imagine that, right. Just being able to get a single family house that has maybe a bedroom and a bathroom in a basement or a bedroom and a bathroom that could be separated out. Maybe people aren't looking for that. And you could Airbnb that and basically pay your mortgage to save up for the next investment.
[00:04:23] That's that's what I'm doing currently. Right. So I think those two options, if you're having trouble finding the duplex triplex, I know Nashville is tough for them I would look at single family with an in-laws suite or guest suite. And if you have a realtor that you're working with and you tell them that clear criteria, they will be able to set you up with an alert that will let you know when those popups, so you can take a look at them.
[00:04:46] Nate: Yeah, definitely. We'll look into that. I'm not sure if I have to kind of make sure that I get my rivet or started looking at those things. 'cause I haven't as much, cause I've looked at a lot of floor plans over the last year and I haven't stumbled on one that had an in-laws in suite yet.
[00:05:02] Niyi: Yep that clear criteria is, is definitely what you're looking for because the more people you can tell, like when I was moving out here, I told the real I was working with exactly what I was looking for, anybody.
[00:05:11] I talked to exactly what I was looking for and were able to see a couple of good deals and I was able to close them one. So yeah. And you're buying at the perfect time, right in the winter. Yeah. This is basically until we hit like the April may timeframe people that are listening their house right now, or for some other reason, they probably have to move for work or something's going on that they're listing it in the winter.
[00:05:33] Nate: Yeah, definitely. I think that's what my realtor was telling me as well that maybe in right now buying would probably be bad better now than later or earlier in the year. So that's, if there was any available homes.
[00:05:45] Niyi: Yep. As far as just mindset and kind of your goals moving forward, would you want to manage these properties yourself to kind of learn and put systems in place to begin with?
[00:05:58] Or would you immediately start with property?
[00:06:01] Nate: No, I definitely want to start off kind of learning exactly what all that entails to kind of manage my own property before kind of pushing that responsibility off to a management company there. So definitely a start would be to kind of take it out.
[00:06:13] Niyi: Okay. And have you looked into like software and things use for that?
[00:06:19] Nate: No, I haven't there any other, any suggestions
[00:06:22] Niyi: Absolutely.
[00:06:22] From system perspective, I used to use something called building. Like build, like build a billion building. And then I am a building.com. It's a little more expensive of a software, but are you still on the road, Nate? No, I'm at home now.
[00:06:38] Okay. I'm going to share my screen.. So I used to use something called bill. And what it does is it allows you to automate just about everything, right? So I wasn't collecting any cash and he checks tenant, you know, line, you were able to screen tenants through their software and actually get like background on criminal.
[00:06:58] It was all very professional. And you had your own website in which you were able to take maintenance requests. And everything was in. Right. So when I would have tenants two things, one, I used the professional software, which I highly recommend. And I'm more than happy to sit down and walk you through that when you're ready to read something out and to I, I made sure that I screened the.
[00:07:23] Very, harsh upfront, because the worst thing you can have is a problem tenant, right? It's almost better to have a vacant house than to have it occupied by somebody who is just not going to take care of it the way that we do. And so after screening people, I'd look for a certain criteria. One no past evictions, right?
[00:07:40] No, whatsoever. None of those, no criminal record two, you'd have a 600 credit score. Right. If you don't outer require a co-signer right. Cause the student that don't have any, I didn't have credit until, you know, like seven, eight years ago, right before graduating and then also I call the previous landlords and I actually talked to them and I asked them like, Hey, would you rent to this person again?
[00:08:03] Just to verify they didn't write down their friend's name or a number or anything like that. And so what you're looking at is the final step in the process that I highly recommend to everybody. And I could send this to you when you're. it's called rent talk. And I don't know if you've ever had a landlord sit down and do this with you, but this helped me avoid so many nightmare tenants to the point where some of the tenants I put into the units before leaving Louisville, when I was still managing the properties myself, stayed there for the last four years that I haven't even been there and they've just stayed on.
[00:08:30] So the way that we do it is let's start walking them through this and just let them know, Hey, you're important part of the business. We're proud of our performance, many referrals, and we want to meet your housing needs. We give them our mission statement, right? And I pulled this off from some books and things that are red, but the goal I make it clear at the beginning, our goal is to provide amazing housing for you.
[00:08:52] Clean we want people that are clean, responsible, we're going to make payments. And we are trying to keep people in our house for a minimum of three years. We want you to want to stay here, right? And so we're going to do our best to make that happen. Now. This is important. I start talking through, Hey, people may not know this.
[00:09:07] This is the lifespan and how long things should last, right? So if we just freshly painted your house, that paint should not be beat up and crushed after one year or two years, right? It should last seven to 10 years. You look at residential homes, people's houses, aren't destroyed, unless kids are running their hands along it and all that stuff. We talk about wear and tear some of the things that that will be reasonable wear and tear. And Hey, we're good with that. We can replace those. We talk about the maintenance. Hey, it's up to you to let us know if something's messed up, please let us know, submit a maintenance request. We can not read your mind.
[00:09:40] And then we get into some of the costs, right? Hey, if you're locked out. If you need, if you destroy something or mess something up in the unit, that's okay, it's fine. We can just charge you for the fixing, but you have to let us know. And then this part is important as well because people try to put everything on the landlords.
[00:09:59] Right? So believe it or not. If you see this part in the, in the top right here, there's ham hock bone. This actually happened a tenant called us in. So they had a clock toilet. We sent a plumber in and they pulled out a bone like. Bone, right? And so of course we build that back to the tenant and they tried to argue with us, but we added this in after that because that's, there's no argument there.
[00:10:21] And what this does is it, we dealt anybody that that you may not want in the property. Cause this is after they've gone through everything else. This is like a final step. Almost like in a job interview we dealt like, Hey, is this person really wanted, right? And so this is a screenshot of the system.
[00:10:39] And you can see, I call it added homes back in the day. You can see this is an actual screenshot from when I was doing it back in 2017, before I moved to property management.
[00:10:46] Boom, on the first the rent was charged the tenant can make a payment if it's late payments due on the first, if it hits midnight and it's the. One-time leak fee of 10% added to it. Plus $5 per day and an automatic eviction note would get sent out as well. Rental agreement. We'd walk through that, answer any questions.
[00:11:08] And then of course you gotta have some incentives in there, right? So the incentive structure that we use. , help keep tenants long-term and it was more around, Hey, if you've been good for 12 months, you get a discount 24 months, 36 months. This is kind of a lot for not even having written the place yet, but when you're ready, just know, you know, there there's some stuff out there.
[00:11:31] Nate: Yeah. Got you. That was very, very helpful. Good. So now the, the other follow-up question, , thanks a lot for that. Cause I've heard a lot of the stories about how, like you, you mentioned not having the right tenant is, is even more painful than having your house not occupied your property, not occupied.
[00:11:49] So definitely to make sure that I go and make the due diligence there to kind of vet through. The tendency before I actually bring them in. Right. Now the question I wanted to ask you around property management in your own experience, and I'm guessing you've been on both ends where you've made managing your own properties versus pushing off the responsibility to a management company, what has been the advantage of doing either either or right.
[00:12:15] And then what has been the disadvantages of being your own manager of the properties I'm talking about stress time and anything like that?
[00:12:25] Niyi: So nobody, this is a great question, by the way, nobody is going to treat your property or your personal belongings, the way that you would. Right. It's just a matter of fact, you would value it a lot more.
[00:12:38] You understand all the quirks around it and you understand the sacrifice it took to buy it. And so when you manage your own property, I would say that you could do probably a better job than 90% of the property managers out there, just because you're going to care a lot more. These dollars are truly impacting you when it's a thousand dollars rent payment, that's coming to you, right.
[00:13:00] As opposed to a property manager where maybe a hundred dollars of that is coming to them per month. Think about that for a second, $1,200 a year to manage a thousand dollars rental that's. And so when you have let's call it less than 10 units. And especially if you live in the same city, I think there's a large benefit to managing yourself.
[00:13:22] And even when you start out managing yourself, so you know what it takes and you know, the systems that should be in place to manage it well, and you also can understand the lingo when property managers start talking about, Hey you know, we need to evict somebody, we gotta take this step and that. And also, so you can understand some of the costs to get things done, to know, Hey, is property management up tearing me on costs?
[00:13:44] Like, Hey, if I call the plumber or I get a flooring guy in and they give me a quote for a thousand, and now my property managers saying, Hey, it's going to cost 2,500. I can call BS on that because I managed the property before. And I have people that have done that. So long story short on the managing. I think everybody should start out managing their own properties themselves.
[00:14:05] At least up until you get to that 10 unit threshold or more. Now, when you pass that threshold, it starts to get a little more difficult and become almost like a second job because there's always going to be something that's going on, it could be Hey, my neighbor's being loud or Hey, this sprint payment is past due and that's all stuff that would fall on your hands.
[00:14:28] And it's not something that you do every single day. And so. I would say, once you get over that 10 threshold, the benefit of moving the property management is that it's a lot less time utilized from your end. So for example I moved to property management when I got to 15 units in Louisville.
[00:14:45] And prior to that, I was still managing those 15 units for about six months when I moved to ball. That was tough. Not gonna lie. Right. I couldn't get eyes on any of the properties. I didn't have as many people to go and see it. I had my realtor and I was using to kind of go check it, take a look and take videos from me, but it was difficult because if I had an eviction and I had to call people from afar, try to build relationships from afar and it wasn't really working out.
[00:15:10] And there was always something going on. I was spending literally probably three or four hours a day working on the properties. And as you know, I still got a day job. Right. I got to still focus on that. So moving over to property management took me from spending three to four hours a day, working on it to initially, maybe two or three hours a week.
[00:15:31] And then maybe two or three hours every two weeks. And now it's like two or three hours a month because I want it to be right. We have meet monthly meetings where I check in ask about this. They send emails in between. But that's the benefit now choosing the property manager is tough. I can tell you that the first one I chose was not good.
[00:15:51] Okay. It was, it was really not good. The first property manager I chose I I'll just give you one story to illustrate it. So when you have security deposits, you're supposed to keep those completely separate, right? You can't touch those legally. You will get in trouble. When I moved away from my first property manager, it took us two and a half months.
[00:16:10] And a letterhead from my lawyer in Booneville to get them to release the security deposits to us, it was, it was, it was crazy. It was like 15,000 that they had insecurity deposits. I don't know what they did with it. I think they were using it for something else, but you're not allowed to do, but that's just one story to illustrate.
[00:16:26] And they were a headache every day was like, what's going on? What's going on? I'm like, why did I move it? I should've just kept managing it. But when I found the second property management team, these guys had systems in place. They had everything automated. I can log in online and see exactly where the money's going.
[00:16:42] Exactly what what's happening at any time. I can message anybody and they get right back to me and they have made my life so much easier, so much so that we're able to scale from 15 units to 25 units in a little less than a year. So we bought 10 more units under them. And now it's just plug and play Nate.
[00:17:00] Now that I've got a relationship with those guys and a team in Louisville. If I see a property that makes sense. I buy it. I'm literally not even at the closing table. Right. They send the documents, I signed it remotely. My realtor goes to the closing table, picks up the keys and gives it to my property managers, my property managers walk the property.
[00:17:16] They give notices to all the tenants. They're doing all of that. Right. They transition them over to our system. They collect the deposits. It's seamless. All I got to do is point out a property sign and move it over to them.
[00:17:29] Nate: Well, thanks. Thanks a lot for that. Definitely keep that in mind.
[00:17:32] Niyi: So that, that goes for what I was talking about. There is long-term rentals. Now, as far as short-term rentals, I would recommend managing that yourself because it's more active and I love it.
[00:17:41] It's actually kind of fun. And it's an upcoming cell, so it's kind of what I do anyway, but it's a active and you've got to, you're getting a rating every day, right. So you got to make sure that you're on it. You can't really, you can, but you got it. Like I'm managing one from a T now that flip that I showed you that it's not up and running into Airbnb. And we got a couple of bookings, so I'm managing that from a T. And I plan to do that for a couple of others as I continue to build my portfolio. But short-term rentals. There's definitely a lot to. cash to be made there. It's just a little more intensive.
[00:18:13] Nate: Got you. And when you say short-term rentals, you obviously refer to like Airbnb properties and what are the, what are the kinds of rentals fall into that category?
[00:18:21] If you don't mind me asking? So the phone into the short-term rental category. Yeah. Yeah, go ahead.
[00:18:30] Niyi: So you've got like Airbnb. VRVO Gigster peer peer space. It's called Peerspace. Yeah. A couple places. It's it's it's all of the above with that. The short-term rental is defined as anything that's 28 days or less . And I actually just got a message on Gigster. I haven't got a booking yet. 'cause I'm, I'm pretty expensive on there, but have you heard of Gigster?
[00:18:53] Nate: I haven't this first time I was going to ask you them gives them those all different platforms for, getting a short-term rental, right?
[00:19:00] Niyi: It is, it is, but Airbnb or BRBO are similar.
[00:19:04] They're like short-term rental Hammond to stay the night, couple of nights. Gigster and Peerspace are like four. Hey, we want to have a business. Networking event, can we rent out your house for, Hey, we want to have a wedding party or a couple people have hit me up about filming in my house. Like, Hey, we want to film something there.
[00:19:24] Like somebody hit me up today. They wanted to, and I have it pretty high priced hot. You can pay, you can get a lot for it. So I have my house priced at 200 per hour for those types of events, because it's still cheaper than an event space. And so this person we're going back and forth, they wanted to film from 7:00 PM until 10:00 AM.
[00:19:43] But they only wanted to pay from 7:00 AM till midnight. And I was like, ah, it's not going to work out. They want to pay like 1200, which is not bad for one day. That's pretty good. Right. That could pay less. But for me, I have it set for a certain amount. I'm like, Hey, if you want to go seven to midnight, we can do that for about 12.
[00:20:04] But if you want to go to the morning, it's going to be three grand, right. So we're still working on them. Maybe I can go to that a little bit, but that is enough to like really jumpstart you. Yeah. It's an incredible it definitely going to look into it. This is the first time I'm hearing of, it seems like the shorter, the short rental spaces is transforming rather quickly.
[00:20:25] I guess it just hasn't. Has it been around for that long? It's been around on the. It's been around the west coast. Yeah. Atlanta recently became a hub for films. They're actually filming black Panther two right now, like posted the neighborhood I live in and a bunch of other films, because they did like some tax credits there.
[00:20:43] And so it started to get bigger in Atlanta, but it's really only in places. I think Nashville would probably be good spot for like photo shoots. I had somebody reach out to me. They want to do like a family photo shoot in a. Modern home, right. So that they can post that. I even had a TV show reach out that wants to do what's the show called it's.
[00:20:59] my celebrity dream wedding, something like that. Gotcha. Yeah. And they have a scene actually sent it to me where they film us every single time. But I didn't realize it's not an actual person's home because the people probably live far away. Like not in the speed where everybody is for filming. So they hire.
[00:21:19] And they at the scene they wanted to film was literally, they walk in the couples are sitting on the couch and then the designer that the wedding planner walks in and starts walking them through everything. And they want a nice backdrop, but they're just going to be sitting on the couch for like three hours filming.
[00:21:34] Wow. You know, I was like, Hey, we can do that. So we're trying to set that up for I think november. Gotcha. But those are all different ways. Plus another one is furnished finder, which is I'm posted on there as well. And that is for mostly travel nurses. So travel nurses come for 13 week assignments. when they come for their 13 week assignment, they're looking for housing that's furnished and they don't necessarily like Airbnb because it might be more expensive, but they check your owner's finder and it's a good way to. You know, especially in the winter, if you want to get more consistent pay and you're good with taking a little bit less.
[00:22:14] It's good. and if there's anything that changes Airbnb law, it's a good way to still make a good amount of money. Cause they get stipends without having to go to a traditional window.
[00:22:25] What'd you call it? What did you call that again? furnished finder.
[00:22:29] Nate: Well, those, I mean, most of what you just shared with me is enough kind of homework to kind of dig into and make sure I got my heads wrapped around it.
[00:22:36] I think I've been kind of slacking off, even, even keeping around. I didn't realize how many platforms were out there for short-term rentals. And now it's just kind of like sitting here, like what have I been doing
[00:22:49] Niyi: literally me either until I started doing it. And why would you, because you got a million other things to think about.
[00:22:56] And so when you think about it like this, right? My whole thing is. The best way to learn is just to get in. Like when you start renting, you're going to start thinking about man, what about this question? That question. And we're going to be able to help with that. And once you learn that it's going to be, you know, like riding a bike, it's like, all right, I can do this.
[00:23:15] You know? So that's why I'm so interested in the short-term rental game. Cause I see how many gains I see, like the ratings are going up. People are booking it up. It's a lot of plot dock I'm in my way. So I'm like, Hey, this is great. And one of the things I meant to mention. So from an investment standpoint, if you wanted to buy a pure investment anywhere, it would cost you 20%.
[00:23:37] Right. And you know that the bank's going to want a bit more down because you're not living in the house. Right. That being said, if you were to do what I'm doing with a couple of other people, and do a, quote unquote vacation home or secondary home. You can do that as long as it's 50 miles away from where you currently live or where your primary residence is. And you could put down 1,000. And so I've got two people that within the next, probably six months or so, I'm going to work with them to do that in Atlanta and I'm going to manage it. Short-term rental I'll furnish it and then manage the short term rental, and then we'll split the profits, and kind of go from there.
[00:24:16] And then if they need to use it, they use it. Right. But that's, that's another way. There's a couple of ways to do it. Like I'm actually looking at other markets to see where I would want to do that because I'm good with a 10% down. Right. That'd be much better than a 20% match for this last one. They had to put down close to.
[00:24:33] Well, I got lucky. I was able to put down 15%, but it was on a $460,000 house. So it adds up and adds up quickly with the prices of homes going up. It's never that 20%, it's never going to be small, especially here I've been in Nashville. I mean, unless you're looking for a property to flip, the average home is around 300.
[00:24:55] So even 10% of that is still kind of considerable. So if you're doing 20% it gets even more interesting and price is only going up with all the money that we've bought into the model. Real estate is world. The hedge funds are turning to. And at the end of the day, the reason so many people turn to real estate and love it is it's, it's also a protection against inflation, right?
[00:25:18] Like if anything, inflates prices go up, you just raise rent. Like, Hey, rent goes up. It automatically goes up. Right. That's one of the things that should always go up, you know, I usually do two and a half percent or 3% or something like that every single year. So that don't get behind the ball. Wow. Just, just in case.
[00:25:39] Yeah. And it should be right. And it does like, because your costs are going to be going up for certain things minus the mortgage, but yeah. So that house in Louisville, right. I keep coming back to that. The first one I bought it started out being rented for 2250, right. Total when nobody, when I was living there. and now, you know, when we sold it, it was running. The highest at rent, a four was 28 50, but it was renting for like 2,700 month at that time. And it's not that many years later, so it's just consistent raises and the mortgage is still the same for the next 20 years. So imagine a 3% compounding interest every single year on the dollars you have coming in.
[00:26:18] It's pretty powerful. Yeah, you can't beat that. Well, yeah, like I said that's basically all my questions for right now. I know we, we're still kind of talking about the deal with Matea and things like that, but as far as just my current frame of mind is just to get my head wrapped around the short term rentals, or really look into what it looks like to manage my own property and start doing a lot of research towards that end. and yeah, Nate, I love it. Let's get to it, man. Definitely. Thank you so much for the toddler on here. I'm assuming we're at time now, right? That's our yeah. 7 45, man. I gotta go, hang out with a bro. He texted me right now. He's trying to go get some, , Pisco Pisco sour, which is basically like a whiskey sour.
[00:27:03] I'm gonna go beat him, Nate. That's enough, man. And when I get back in town, we definitely got to figure out when. Yeah, let me know. And I'm sorry. I wish I was better communicated. I just kind of knew that I wasn't going to be, would make it last weekend. I just assumed I was going to text him when he came back from vacation, but I knew it would be back this weekend, but I felt that you'd mentioned birthday weekend.
[00:27:24] We'll take over the next. You did vocalize all of that. No worries, man. Cause I have to keep reminding myself because things are popping up on that promise. I go to anything that midnight checking your phone, you know, I just want to do a quick no, no, can't do it. Stay away. Yeah, definitely. Hey, say how to say dire broke for me.
[00:27:49] I seen him a while. We should definitely catch up when we get a chance so done and done Nate, be safe and I'll let my brother know that you said. All right. Be safe, man.