<p>Glenn Stromberg, Principal of Stromberg Investment Group, has over 30 years of experience in the real estate and housing market in Texas, North Carolina, and South Carolina. His hard-won experience and battle-tested systems set Stromberg Investment Group apart.</p>
<p>Glen's Stromberg originally from Chicago is the principle of Stromberg investment group, which began selling houses in Texas in the turbulent real estate housing market in the 19 eighties. And he has weathered many cycles in the Texas market in the last 30 years. Glenn basically grew his business quickly, ultimately owning 13 sales centers and managing over 100 employees his success and eventually led him to become a partner in a well known housing manufacturing business, currently owned by Berkshire hathaway.</p>
<b>What You’ll Learn From this Episode:<b>
<a href="https://appraisersecrets.com/2019/01/24/season1-episode1-2-2/">You can find the episode on Appraiser Secrets
<p>Glenn Stromberg, Principal of Stromberg Investment Group, has over 30 years of experience in the real estate and housing market in Texas, North Carolina, and South Carolina. His hard-won experience and battle-tested systems set Stromberg Investment Group apart.</p>
<p>Glen's Stromberg originally from Chicago is the principle of Stromberg investment group, which began selling houses in Texas in the turbulent real estate housing market in the 19 eighties. And he has weathered many cycles in the Texas market in the last 30 years. Glenn basically grew his business quickly, ultimately owning 13 sales centers and managing over 100 employees his success and eventually led him to become a partner in a well known housing manufacturing business, currently owned by Berkshire hathaway.</p>
<b>What You’ll Learn From this Episode:<b>
<a href="https://appraisersecrets.com/2019/01/24/season1-episode1-2-2/">You can find the episode on Appraiser Secrets
It's certainly reasonable to understand how the acquisition point going to the value perspective could be one that would be certainly less than a frame built home on those, on those individual. Last,
Speaker 2:you are listening to the appraiser secrets podcast with your host, Mark Jackson. You will get straightforward advice for how to make a profit on every new transaction that you do, compounding your net worth and grown your wealth substantially all through real estate. Get more information@appraiserssecrets.com.
Speaker 1:We go. Welcome to the appraiser secrets podcast, powered by investor comps, the best real estate valuation site where you go in and get the best training data and support to ensure that you make a profit on every new deal that you do. I am extremely pleased to have my very good friend, uh, Mr Glen Stromberg with today. Glen, how's it going, man? Man, it's gone. Great Marketing. So as always, it's a pleasure to be with you, my friend. Outstanding. Outstanding. I, I, you know, I always enjoy the opportunity to care and share when we get together in person, whether it's in different masterminds and were involved in together is always good to be in your company and I just want to say thank you for taking the time out of your schedule and you're traveling over the next few days and I'm going to be on a plane I think tomorrow, but couldn't be more grateful for you to carve out a little niche for us so we could have your own board. Let me just jump right into this. So we've had a, just a dynamic relationship I guess going back a good five years now, but your business has grown in a very special way and there's always information that I guess I'm going Kinda share with folks who you are, where you come from, but this doesn't really begin to scratch the surface at all. But everybody. Glen's Stromberg originally from Chicago is the principle of Stromberg investment group, which began selling houses in Texas in the turbulent real estate housing market in the 19 eighties. And he has weathered many cycles in the Texas market in the last 30 years. Of course, he's not 30 years old yet, but we'll get into that a little bit more. But I started when I was five. That's right. There you go. Glenn basically grew his business quickly, ultimately owning 13 sales centers and managing over 100 employees his success and eventually led him to become a partner in a well known housing manufacturing business, currently owned by Berkshire hathaway. In 2006, Glenn decided to exit it's high school, but consuming business and focus on architecting a lucrative investment deals for his own portfolio under his, uh, Glen Stromberg Group investments umbrella. But you also devote a recession proof model for finding and buying overlook properties that typically could provide excellent Castro and longterm upside potential. Currently under the Stromberg Investment Group banner, Glenn Works primarily with private investors who are seeking investment opportunities that provide attractive yields in our secured by a word I think he's about to go get a trademark on, we call it or he calls it wheel estate. That's what I do. Hurt it. Not Real estate real estate. Glenn, this thing that you do is so very unique and special and we're going, I want, I just, I'm excited to have the opportunity to kind of expose it a little bit more. Why manufactured home?
Speaker 3:Well, good question. Um, you know, it's funny how things work, but back in the 19 eighties it all started. I answer an and out of the paper and the guy said I could make$100,000 a year selling mobile homes. And he was right. I could. And uh, so that's how I got into the mobile home business. Now I always want to clarify something. This is good for your, for your audience here. There's two types of. There's two types of manufactured home investments. Number one is a manufactured home park where normally it's a big park with the would normally single wide, sometimes double wide homes in the park that they rent the space, they own the home and so forth. Okay. That's what I do. Okay. That's not what I do. I've owned mobile home parks in the past, but I, I, that's not my, that's not my current business model. What I do my company does is we buy homes and three restates Texas, north and South Carolina and there they are manufactured homes, primarily, probably 98 percent of them are double wides there on anywhere from a, from a half an acre usually to, to, to an acre to two acres of land. And they are real estate. Okay. And uh, our joke is we're in the real estate business because we don't buy nothing if it didn't come with wheels. Okay. And what I always like to tell people is this, and I really believe this from the bottom of my heart. I think it's the best kept secret in real estate investing. Okay. Reason I think that is, is because when, when you say, when you say the word mobile home, I think people think of a, of a metal side of house with tires on the roof. Probably an old ugly looking house. And the, the, the double wides that we buy that are on that are, you know, they're on land and their real estate to come with a mortgage or a deed of trust. But in most cases they're going to be 1500 to 2,500 square foot. They're going to have every amenity of a of a site built house and quite frankly some of them are built better than track houses. True Story. My Dad was a mason contractor and a builder. He's retired now in Chicago, came out and saw about 15 in my properties in Texas and he went, man, these are built better than than track houses in Chicago. And I said, so that's why. That's why I think it's the best kept secret in real estate investing. It's about half the price. In many cases they're double the cash of a traditional
Speaker 1:single family house and obviously based on solid markets in Texas, in the Dallas, fort worth area, and then in South Carolina, North Carolina, those, those marks, little different terms of the cost of land and the property there, but overwhelmingly it's certainly reasonable to understand how the acquisition point going through the value perspective could be one. That would be certainly less than a frame built home on those, on those individual lots. Because you're talking about same thing in terms of infrastructure, you this go be sewer connection or some type of septic or it's going to have, you know, counting water or city water and you're going to have regular power lines come through it. You're talking about individual home on land, not one of these parked on him. Absolutely. And in, in a lot of cases people prefer our properties because they're getting an acre of land versus the zero lot line house that need. And if I can, let me affirm you. I'm in my unusual Dallas Fort Worth. Yeah. What I want to do is take a moment to affirm you in terms of, uh, people wanting to have a preference for the home or even your dad's experience of being a masonry contractor. When I was appraising, there were any number of times that I visited a and was doing a refinance appraisals for manufactured homes on land and the homeowner, whether it was the male or the female of the home, they would go. They would walk you through how they selected the stain glass separation between the living room and the kitchen. How they picked out the different hardware things for the bathroom, they picked out the colors for the walls and in any number of cases these homes were more, we're better kept and I'm, the homeowners had just that pride in ownership with the landscaping outside as well as the maintenance of the home in it, a number of cases better than those where I went and did several hundred thousand dollar homes. It's amazing just the difference in terms of um, you know, appreciating what you have, if I could put it that way. So I definitely affirm you that not only construction but just the way people care for their homes in this community of modular home or property that's brought and put on a foundation to house. Just the way they are, you know, just the way I appreciate it. But their costs are lower as well. Which you obviously take advantage of in your business. Absolutely. And I, I, I agree with everything you said and yes, it's, it is affordable housing and it's, you know, um, our, our biggest competition is probably apartment complex is right as far as price goes. Yeah. People prefer to, to apartment complexes day long, you get
Speaker 3:a lot more land, a lot more, a lot more house. Um, you know, the privacy, your kid's got an acre of land to play on and stuff and so yeah, it makes a big difference. Plus, you know, the good thing about manufactured homes, they're normally out in the surrounding counties and school districts are actually better out there in the, in the Dallas, Fort Worth area, there are not known as the best school districts and so the, the, the, the, the suburbs have the better school districts and a lot of people prefer to live there versus being in the Dallas, Fort Worth School district. So
Speaker 1:I imagine in some cases it may just be that because the population are smaller, potentially they don't have as much burden on the resources that you're bringing in tax wise so they can deliver a better product for the school systems. They would say that's probably right. Yes, I believe so. Glenn, you and I've had a couple of conversations in regards to when you're looking at a property, some of that related to maybe the manufacturer year, so maybe even the manufacturer kind of pull back the curtain just a little bit more. What do you, what would the difference between, let's say I'm looking at a modular home, it's a double wide, uh, it's just outside Charlotte in North Carolina and maybe gas, stony accounting, stuff like that. And uh, it was, I'm looking at two, one that was maybe manufactured in 1985 and then maybe one that was manufactured in 1995. I'm not a big deal, just 10 years. What would someone that you would give advice to as they're looking at those two difference? What to have their eyes open for preference? Just kinda pull back, pull back the onion, peel a little bit forced given that, that those dynamics. Just the 10 years difference in terms of.
Speaker 3:And really what we do we, we use 1990 as the barometer. Okay. And I'll make a long story short. Um, there was a period of time that manufactured homes were built. Substandard. Okay. They use particle board floors a lot of times in the eighties and the seventies. Not all of them. There's some, there were some houses that were built really well back then too, but there was a lot more homes that were built with the particle board. Floors was the big thing that they, if they got wet, they would start blowing everything else around 1990. The manufactured housing industry picked up their game. They used plywood or OSB board, same as in a is in a site built house and so forth. And so. And then they added more amenities. There was just, they, they, they picked up their game, you know, I always use it to where like a car, right? People say, well what's a good car? Well there's, you know, there's going to be a low end car or mid range car and a high end car. Right. Same thing. Same thing with manufactured homes too. So you've got to look at, you've got to look at that. Um, but, but 1990 is kind of the, what we use to, where most of the homes were very well, you know, after that
Speaker 1:thereafter. All right, that's a good thing. And when you're looking at him, um, let's see. Okay, so 1990 is going to be your, your threshold and go forward. What are the things that you know, that you're going to want to give know the most attention to? Is it going to be systems? Is it going to be some cosmetic items? Is it going to be, you know, the exterior? What is that you're looking for that you would advise somebody say, hey, this is going to be the four things that are going to be the four or five things that are key when you first determine that is built 1990 and later. And now I got to go ahead and go down my checklist.
Speaker 3:You know, to me it's real simple. Okay. Number one is the neighborhood gang want to be in a war zone? Never. Okay? If you wouldn't send your wife, your daughter out to collect the run at night, you're not going to. We don't want to buy it. Okay. That, that, that's, that's our model. That's number two. Number two is the floor plan, right? There's good floorplans bad floor plans. The good thing about manufacturing homes are most of them are done by engineers and most of them are good for plans, but it's got a couple of bad ones out there. It's got to be decent for plan and then it's got to be a homeless. Going to hold up over time is because every home we're keeping or returning to our investors, they're keeping. And so if it is one of the lower end houses that might have been built with substandard materials and so forth, we'll probably shy away from that property because it's probably not going to hold up over time. So, um, and then the fourth thing is the numbers. If the numbers work right, I mean just, we, those are the four things that we factor in. As you know, real estate's all about the numbers, right? If the numbers work we're in, if they're not, they don't work. We're not just that simple function. Our offers based on that. So
Speaker 1:I mentioned this once before and again, um, you know, for the purpose of the podcast and you know, any disclaimers, that type of thing, are there any manufacturers, for lack of a better phrase that you prefer? Um, we will give you don't prefer. We don't want. We don't want.
Speaker 3:Yeah, the big players out there. Okay. Clayton homes, fleetwood homes, they've been around forever. Palm harbor is a big. Is a big one. Oak Creek has been around forever. These are the ones in Texas had been around forever. Solitaire. Um, there, you know, and I'll say this, there's a lot more good ones than bad ones. You need to build, you know, tried to just hit the low price point and probably probably went substantially, you know, just a little bit too cheap, whatever. Uh, but, uh, but for the most part, yeah, the big, the big manufacturers that have been around for a long time. Redmond's been around for a long time. Even those were the ones that. Yeah, typically they, they, they do have some low end stuff. You got to be careful every once in a while, but for the most part they're good.
Speaker 1:So on the heels of that, and thank you for sharing that. That's the idea that there's more good ones and bad ones that, that definitely question or is again, get get the year right. And then knowing that, you know, for all intents and purposes that, you know, most of the manufacturers are doing good things when, when you're looking at your lead generation and the type of opportunities that are presented to you when you're thinking and we could break it out and bull market areas when you think of, you know, ideal acquisition point and rents in your Dallas, fort worth market, which is a much more metropolitan area and then some of the borderline area that you work and it was a borderline between literally to states of North Carolina and South Carolina while you're doing business there. Um, what are you saying is your ideal acquisition point? Both costs and renovation in the North Carolina South Carolina market versus your Dallas, fort worth market.
Speaker 3:Okay. And as, as an, as an average, I would say that are typical and I use the term all in price, right? That's acquisition plus Rehab, I don't care which is which, but just the total of the acquisition plus the Rehab in north and South Carolina is probably$45,000. Okay. The typical in the Dallas Fort Worth area now is probably$85,000. Almost double. Okay. That's the rule, you know, that's kind of the guideline there. And then the rents are recording, ironically, the rents that we get for him workout almost identically the same return on investment. Everything else, it, it, it works out that they all work out. Very good. So
Speaker 1:cool. So let's, let's kind of shift the conversation to that, to the, uh, the longterm hold side because your business model, you're engaging with investors, you're building a portfolio for Stromberg investment, but they also, you know, working a turnkeys. And when we say Turkeys, we're talking about a person that's coming in basically buying that home for their own portfolio. And then you're doing the property management and they're earning the lion's share of the cashflow for that property, but doing the property management is not for the faint of heart, it just not. So as you look at the decision to keep the property management in house as well as for those clients that are doing a turnkey properties, I'm one of those that you would say are key to being successful with property management.
Speaker 3:Well, let me tell you a quick story. Okay. Back in. We love stories. What's that? We love story. Back in 2008 I was a buy fix and flip guy was. It was just me. I was probably flipping three a month to$30,000 a piece out of my house with no overhead. Life was good, right? And then when 2008 had crashed, I had about 18 properties out in land that I couldn't give one away because banks weren't, weren't financing. So I had, I had, I had a loan. Property Management, okay, we'll stay investment clubs. Talked to property managers and I just picked the best of what everybody did because here's my contention, mark, I especially for me because I want to, I want to do it for my portfolio, but we'll do business with an investor. I don't want. I want to. I'm the one responsible for it. I'm the one setting the expectation setting. Everything else I want to do. The property manager, we, we tell our investors this, you have, you have two responsibilities with us and that's it. We do everything else. You're totally passive. You have to be able to wire the money to the check or wire the money to the title company a day of closing. And you have to, you have to look at your bank statement to make sure that the money's there every month, which it will be the rest of it. Okay? So, so, um, what we did by default, I just went out. I've never had an original thought in my life. I tell people that I copied the best of what everybody did. And, and I think we're, um, we're really good at property manager. We're dialed in and we're dialed in and we, you know, we set the expectations properly, we screen the tenants properly, we get the right people we get. And so it's, it's, it's really, it's um, but it, it's, it, it, it took some, it took some research, it takes some education that took some stuff, but we're, come on back. Just do it with me. Come on back.
Speaker 1:We have a, we're going to, I'm just going to pause here. I'll make sure I make note to a scarlet that last time. I don't know what happened. Sorry about that. No, it's quite all right. We'll, we'll easily be able to, um, and the two together. So I don't know if it was me. Are you talking about that? No, no, no, no. So you were sharing, um, you, if you would start right back up where you were talking about all you need the investor to do. And that was the idea of wiring the money and they will receive. If you can go take one, we'll go one to five and just start with all of the investor has to do. Okay.
Speaker 3:Four, three, two more. Yeah, and like our investors have to do is two things when they do business with us, they have to wire the money to the title company to look at their IRA statement or their bank account to make sure that the money went in there, which is on the first of every month and that's all they do. They're totally passive. We do everything else for them. We do the whole property management, we coordinate the service on it, we coordinate the make readies, we get the tenants for them. They can go with the vast majority of our investors, our tenants into our dentists and doctors and they can go work on teeth and we'll go work on people and we take care of the real estate aside for him. So
Speaker 1:there you go. There you go. So when again, when you say I'll have to do is check their statements, that's just a cash flow that's going back into their investment account to their banking out month over month after month. You're handling everything else?
Speaker 3:That is correct. It's an automatic draft every, every, every month and it goes out. It goes out and sits there. Before the first and I just tell them they gotta look at it to make you know, so they know that they're getting their money.
Speaker 1:There you go. Good stuff. So when you think about the keys to property management, what to circle back to this, um, as you're delivering on that place in clients managing, you know, whatever the case may be that comes up with, um, you know, collections and slash or potential maintenance issues, stuff like that. What are the three or four things that are Ashley? Absolutely paramount to the success of your property management activity team and we are wherever you want to take us, kind of guide us down that road.
Speaker 3:Yeah, we, well, first of all, I've got a great team. Okay. Nothing happens without a great team. You've got to have good people. And which we do. We've got a, I think we have 15, 16 employees now in different areas. All different areas. Probably foreign property management and uh, we, you know, like I said, I've got a great team, number one, but you know, property management and buy and hold real estate really, you know, it's all about who you put in the house, right? I mean, you put good people in the house, you get good tenants in there. It's easy. People pay on time, they do what they're supposed to do. It's not a real job, absolutely. But the wrong person in there, they will wear you out, cause you all kinds of grief and all kinds of, all kinds of stuff. So, um, but, but what, what the deal is, is that is like we, like, like I say, we, I'm, you know, we, we totally, we run, we run credit checks, background checks, criminal background checks, w we, we, we, we call their employers, we call their, their past landlords. You know, we put the odds in our favor and if they do have some sub standard credit, we get bigger deposits to. Okay. It's all based on their history. Maria will get bigger, we'll get bigger deposits and that they have pets we get, we get pet deposits and uh, we, we want to put the odds in our favor when we're, we're when we're doing, you know, when we're putting a tenant in the house.
Speaker 1:Okay, good stuff us unique. I'm a similar to yourself. We do some turkeys and the advantage and it's or market and um, for just by way of sharing, uh, there's a gentleman does stuff teaching out there on a landlord and one of the things that he uses, his phrasing you refers to all of his clients as three-star residents. So the terminology of tenant just kind of goes out the window. Three star residents. We've actually adopted language and it's amazing just the response from people as you engage with and talk to them that we want to just congratulate you on being one of our new freestar residents and they, it just changes how they think about themselves.
Speaker 3:Good stuff. I'm writing that down. I may change your five star restaurant, but yeah, I like it.
Speaker 1:Hey, we'll run with it and it's really, really good stuff. It will, it is, but you mentioned some key points. Um, and, and these, these are, these are significant because I think most folks are one if, if they're, if they're being downloaded when to do it themselves and not have a team. And then especially early on, it's like whoever I can get in there and whoever and getting that house, as long as I'm not having to carry the cost anymore, absolutely tackle those two up front. It makes all the difference in the world. And so I'm glad that you brought those out. I mean, yeah, you want to do the credit checks, you want to do background checks and you know,$19 on doing those things, whatever, you know,$20,$30 because it's going to save you headaches down the road. The idea of doing bigger deposits, if there is a challenge with a credit or maybe prior, prior landlord or history or whatever the case may be, that will be when someone, when they've got some, when they've got something to lose, people tend to behave a little bit better.
Speaker 3:No question, no question. And one more thing that's really, really important too, is how you set expectations.
Speaker 1:Okay?
Speaker 3:When we sign a lease, this is the way I always did it. Okay. And I would say I would say, okay, Ms Dot Mr. Mr Tennant, let me explain something here. I have a 24 slash 24 page lease here. Want to be real candid about something here now. Okay. On the first year, rent is due. I'm the third is acceptable on the fourth. We don't, we don't collect, we evict. I'm a nice guy but I will throw you out so fast, it'll make your head spin. Okay? Okay. And, and, and I say that for a reason and I actually asked them this question too. I said if you go to work all month, all month and your boss at the end of the month sells you, man, I ain't got the money to pay you. How do you feel? Exactly when they go? That's exactly how I feel. And like I say, I will throw you out so fast, it'll make your head spin. So do not sign this lease if you're not going to pay and pay on time.
Speaker 1:There you go. Don't waste my time or your time. Make it nice and clear right up front.
Speaker 3:I want them to understand that I mean business and they yes, this, this, this, this lease states that I've got to give you a good habital property, which I will do that also states you have to pay on time and take care of my property, which you better do that otherwise weren't yet.
Speaker 1:Thank you. Feel very strongly about that Glen.
Speaker 3:I feel very strongly my heart. Yes, it's dear to my heart. Yes,
Speaker 1:you've got a wealth of knowledge and that's just, that's just playing the evidence. Given your experience of the last several decades that we've been doing this and that you've really honed in on your niche. You're not. You mean you haven't deviated from it and years and years and years, so there's a wealth of knowledge that you have. I want to make sure that if folks want to follow back up with you, get back in touch. I'm just to maybe either invest with you to maybe do some lending with you, provide you some ice that they can get those statements. All they'll do is check every month or maybe they just want to get started and find out a little bit more. Um, everybody. Glen Stromberg is based in the Dallas Fort Worth area. You can find them online at Strom bird investment. That's s t r o m b e r g investment group.com. And he's got a great team in particular, Melissa. Uh, and you can email Melissa if you want to get an opportunity to get on. Glen schedule is Melissa, m e L I s s a Melissa@StrombergInvestmentDotComStromberginvestmentgroup.com or org investment group that come out saying thank you Glenn. And a good contact number is going to be area code two, one four, two to six. One seven, two eight. Again, that's two. One, four, two to six. One sentence. Wait. And Melissa at strong bird investment group dot come up. I always like to ask one just other thing, if there's ever a word of wisdom or just the tip that you would share some way, not so much just about real estate, but just investing in general, um, something that could take advantage of something to look out for. What would that be glad from your perspective?
Speaker 3:Well, I might tamp that. That's easy for me. You know, and mark, you and I are in a mastermind group together and, and you know, and we hear the phrase constantly, your network becomes your net worth. Okay. And, and you know, you and I've heard another thing said too, it's not about who, you know, it's who knows you. Okay. And, and you know, I would, I would encourage everybody, not everyone that wants to invest in real estate wants to be parked in the game to, to, to get involved in, in local reia groups and mastermind groups. And I know it's been a game changer for you. It's been a game changer for me. And I think that's, that's the one area. I think that's that's how you. You've cut time getting to where you want to go. I've gotten in the last seven years, I've gotten to where I've gotten there way faster than I could've ever, ever gotten there on my own without being in mastermind groups and so that that. That would be my suggestion.
Speaker 1:There you go. Good stuff. Then. I hope you will accept my invitation. I'd like to come bring you back again and really get into some of the nuts and bolts. What are the real fruit that can be generated from engaging with you in business down the road or maybe a certainly learned from you as well. I know you'll accept that invitation.
Speaker 3:Always happy to mark. You know, like I said, I, I'll,
Speaker 1:I appreciate you having me on today and I love you buddy. Okay, well we're, we're, we're, we're, we're both rise higher. End the cream because of each other and I'm grateful for that. This has been another episode of the appraisers secrets podcast, powered by investor comps. Come back to his office inscribed. Give us some light, leave some comments to any topics that you'd like us to cover, guest that you'd like me to bring on. We can do that as well. Just reach out to us, subscribe, leave comments, and I'll promise you we'll get back to you glen. Thank you again so very much for being with us. Everybody got. Thank you. Thank you, man. God bless everybody. Take your care with on next episode. I'll have a good one. Bye. Bye.
Speaker 2:You've been listening to another episode of the appraiser secrets podcast with Mark Jackson, the place to be to create your freedom lifestyle with more time off, security and peace of mind. Find out more@appraisersecrets.com.