Eager to uncover the secrets of successful real estate investing? Join us as we sit down with the dynamic duo, Jake and Jordan, who've taken the real estate world by storm with their diversified approach. From flipping distressed properties and wholesaling to venturing into larger apartment investments, they share invaluable insights about their journey and growth in the business.
Jake and Jordan are not just about profits, they place a lot of emphasis on quality and authenticity in their approach. They enlighten us about their unique marketing strategies, prioritizing distressed property owners and providing solutions tailored to their needs. One such solution is their exploration of novation strategy, a brilliant alternative for sellers seeking higher offer prices. They also spill the beans on their 2023 goal: reducing risk exposure - something every investor can learn from.
But there's more. This episode is packed with golden nuggets from their experiences, including the importance of educating oneself, setting the right expectations, and their outlook on the potential legislative changes coming up. Looking for larger deals? They've got you covered. They share their experiences with equity in bigger deals and how it trumps assignment fees. They also take us through their joint ventures and their focus on motivated sellers in specific areas of Pennsylvania. Get ready to be inspired by their story of a zero-down seller finance note on a 20-unit property in Bloomsburg and their plans to scale up. Don’t miss out on this episode bursting with insights that could transform your real estate journey!
Contacts for Jake & Jordan
website
https://housebuyingsolutionspa.com
email: Jake@eagle-capital.co
Investor hotline:
https://offmarketmentor.com
Phone:
570-671-2935
Eager to uncover the secrets of successful real estate investing? Join us as we sit down with the dynamic duo, Jake and Jordan, who've taken the real estate world by storm with their diversified approach. From flipping distressed properties and wholesaling to venturing into larger apartment investments, they share invaluable insights about their journey and growth in the business.
Jake and Jordan are not just about profits, they place a lot of emphasis on quality and authenticity in their approach. They enlighten us about their unique marketing strategies, prioritizing distressed property owners and providing solutions tailored to their needs. One such solution is their exploration of novation strategy, a brilliant alternative for sellers seeking higher offer prices. They also spill the beans on their 2023 goal: reducing risk exposure - something every investor can learn from.
But there's more. This episode is packed with golden nuggets from their experiences, including the importance of educating oneself, setting the right expectations, and their outlook on the potential legislative changes coming up. Looking for larger deals? They've got you covered. They share their experiences with equity in bigger deals and how it trumps assignment fees. They also take us through their joint ventures and their focus on motivated sellers in specific areas of Pennsylvania. Get ready to be inspired by their story of a zero-down seller finance note on a 20-unit property in Bloomsburg and their plans to scale up. Don’t miss out on this episode bursting with insights that could transform your real estate journey!
Contacts for Jake & Jordan
website
https://housebuyingsolutionspa.com
email: Jake@eagle-capital.co
Investor hotline:
https://offmarketmentor.com
Phone:
570-671-2935
Hey everybody, welcome to the Real Estate Community Network podcast. I'm Mike Bazzadonna, my partner, steve Franco, which is not here. He is out with a bunch of celebrities and he will tell you all about that next episode for sure. Today we got Jake and Jordan. They were on our very first episode here at the Real Estate Community Network podcast. That was about a year and a half ago. At that time they were a wholesale on a 20 unit which they end up buying and made it a great rental property. They're helping distressed property owners. They're fixing, flipping, they're buying more rental properties. They're doing a whole bunch of stuff. We got him here today on our show, so let's welcome Jake and Jordan.
Speaker 2:Welcome, guys, hey everybody, I'm Jake Arnold. I'm a Real Estate investor. We started off in Bloomsburg, pennsylvania, and my partner is Jordan. I'll let him introduce himself.
Speaker 1:Jordan, where are you?
Speaker 3:I am here, Jordan Ambrose Eagle Capital. I mostly deal with the dispositions, end of the business. Like Jake said, we're buying whole investors, whole saving, whole gamut.
Speaker 1:So what's your main thing Since that 20 unit? I mean you guys have really blown up. I see you on Facebook all the time. I see you at all the meetups Instagram what else, john TikTok?
Speaker 2:Oh yeah, we're on TikTok, we're on Twitter everywhere, doesn't matter.
Speaker 1:I open up social media. I see you too.
Speaker 2:Well, I think our product. I think it comes down to the old saying of you know you can have the best product in the world, but if nobody knows about it, then you're not going to sell many units, right? So I think we honestly have a really good service where somebody could come to us, avoid the hassle of listing their property on the MLS, avoid the hassle of doing multiple showings, get an offer that they can rely on, that they know they can, you know, move forward with, and then you know, we also have creative solutions for a bunch of different sellers that we love to educate people on. I really think it's a supreme service, you know, compared to selling your house the traditional way. So we're just trying to get the word out and get as many people to know about it as possible, and that's been our marketing technique. It's been an authentic approach, just kind of documenting what we're doing, and now we're trying to focus on quality rather than quantity, so much so. So that's kind of where we're at now with the social media stuff and everything.
Speaker 1:So when you say quality, what do you mean? Quality? You want a better house.
Speaker 2:Yeah, or well, I think, because you help everybody With content, I think oh you're talking about marketing strategy. I think with content, we just want to try to provide more value. Sure Educate them At storytelling and stuff and make it more. A lot of our content has been like these are the facts Like the FHFA was founded and blah, blah, blah, blah blah these are statistics. So we're trying to do a little bit more storytelling and make it a little bit more engaging.
Speaker 1:What about Jordan?
Speaker 3:Yeah, and to Jake's point, I mean we really quantify the quality of the relationships that we're forming with these distress sellers through the amount of referral business that we get, because we'll have people call us to take over their mortgage. We don't have to approach them. They've heard through the grapevine that we can provide an exit for a distress situation, or even, you know, not just subject to cash offers as well. So it's really a testament to consistency and providing a quality service that we see through the referral volume that we get.
Speaker 1:You're definitely quality. You know your guys aren't the regular. There's a lot of wholesalers out there and that eat me up. You know they don't even know how to talk to the people. They don't really know what they're doing and that gives a person like yourself and mine a bad name. You know you say you're a wholesaler. I never say I'm a wholesaler. I don't know if you guys call yourself wholesalers.
Speaker 2:No.
Speaker 1:I'm a real estate investor. I don't really wholesale. Wholesale is my exit strategy. I'm looking really just to buy it and flip it.
Speaker 2:Yeah, we're investors. That wholesale is one of our exit strategies.
Speaker 1:But you have a team for wholesaling.
Speaker 2:Yeah, yeah, and you know we do do a lot of wholesale deals, but our primary goal is to buy and hold and build a large portfolio and that's what you guys are doing now.
Speaker 2:And that's so. Our goals for 2023 were to not expose ourselves to any unnecessary risk to build up capital reserves as the Fed raised interest rates faster than ever before, and so that's what we did, and now, as we come to the end of the year, you know, we kind of hit our goals. We have started buying more and like flipping we have one flip going on We've started doing innovations a little bit more as well.
Speaker 1:And can you explain? Because there's there's beginners that listen to this, so why don't you explain what that is for them?
Speaker 2:I'll let Jordan explain that.
Speaker 1:And he's the king in that right.
Speaker 2:Yeah Well, there's a guy actually named Novation King.
Speaker 1:So we don't want to take his name.
Speaker 3:Yeah definitely, definitely not the Novation King, but we're seeing it as a very viable strategy, especially with the the upcoming market, especially with the potential for upcoming legislation regarding assignments of contracts. Novation is essentially a concierge service of sorts where you can approach a seller who maybe wants a little bit higher than a wholesale offer for the property and they're still in a distress situation where they need to trade, you know, price for convenience. In some fashion we can offer that concierge service and go under contract and get them locked into a price and we're able to navigate that contract on the open market, on the MLS, of course, under the watchful eye and the license agent, and guarantee them that payout. And then, you know, take the excess proceeds as our profit. So it really is a win-win situation because we're able to make a higher offer on the property and still help the seller and help our business by recouping some of those funds that we may have just let go on a regular wholesale transaction.
Speaker 1:So the realtor still gets their commission.
Speaker 3:Absolutely 100%.
Speaker 2:Absolutely. And to expand on what Jordan was just saying, it kind of goes back to my first point of we're providing a really good service where we're kind of like a one-stop, you know solution. If our cash offer doesn't work which it is a lower offer. You're trading time and convenience for price in most situations and we're kind of running an equation to see what we could pay cash. So when you're able to offer different purchasing strategies, such as the Novation, it really helps you know that discussion go further and it really helps help the person that's in distress, you know. So with the Novation we'll sometimes make repairs, like we just fixed a furnace for somebody because they had an inspection coming up. And, yeah, you know, sometimes the sellers don't have the money to make the repairs.
Speaker 1:So you front the money? Yeah, we'll make the repairs. What if the house don't sell?
Speaker 2:Then we're screwed. Okay you're just a good guy.
Speaker 1:I just want to make the point that you guys are good guys.
Speaker 3:Yes, absolutely, and it really is about limiting risk on those type of transactions. I would never encourage anybody to do a full-blown renovation on a property while under a Novation Agreement, because you don't have title.
Speaker 3:Yes, you don't have legal title to that property during an escrow. So you really want to limit your exposure. Like Jake said, you know, fix a furnace or fix a toilet flap or not a big deal, but once you get into you know the thousands of dollars with repairs. You definitely want to take a step back and think about the risk that's involved with that transaction because the seller could just ghost and go to Mexico and he would be sure in the wind.
Speaker 3:So it's really ideal not to do any repairs at all, just pick the right type of property that can sell on the MLS as it is yeah.
Speaker 1:So you would do a flip with a subject too.
Speaker 2:Yeah, so subject too. We actually are doing a flip right now that we acquired subject to. So we're getting a lot of calls from people that are behind on their mortgage, that are struggling to make payments, not necessarily because they were unqualified borrowers when they got the loan, but more so because everything's gotten so expensive and their wages don't really support their quality of life. So they're seven months behind, six months behind, and they're calling us now because there's no more loan modification programs. You know, all that stuff is kind of stopped when the CARES Act stopped. So we're dealing with a lot of those situations, and subject to oftentimes is the best way to make some of these deals happen, because some of these people are underwater but they have a good interest rate. For us to purchase a property with an 8% to 10% interest rate, it doesn't make sense in a lot of situations If we could buy something subject to, quickly renovated it and then list it again. That's an ideal situation because we don't have as much entry cost.
Speaker 1:That's cool. I did a subject to flip and I only made one payment and I sold it. Yeah, it was really no big deal, but subject to is scary though If the bank calls on it. Have you run into those situations yet or no?
Speaker 2:No, we're not really too fearful of a note being called due and mortgage being called due. We don't want to build a portfolio of a bunch of subject to properties that we hold forever, but there are people in the real estate space that are, such as Pace Morby. I just watched a video that Pace Morby made. He said seven subject to deals called due. All you do is simply sell it back on an installment sale. You transfer deed and title back into the seller's name and you convert it into an installment sale that satisfies the deal on sale clause.
Speaker 1:That works. Some people are scared. I'm not scared. I know you guys aren't scared. You just figure a solution out. What else do you guys do? You're just wholesaling.
Speaker 2:So right now.
Speaker 1:Wholesaling. You just said you're flipping.
Speaker 2:Yeah, we're flipping and we're trying to acquire large apartment buildings. We still think that the other shoe has yet to drop in the commercial real estate sector. We think that the credit restrictions aren't 100% reflecting in the market today. We think the next year or two there's going to be massive opportunity to acquire some of these larger buildings. In the meantime we're going to start flipping because everybody else is backing away from it. The other competition has went away.
Speaker 1:So you're seeing less and less wholesalers. I've seen a lot less people at meetups now too, that were coming there, that had a rental or wanted to get into business. I don't see a lot of people because I go to a lot of the meetups.
Speaker 2:Well, the Burr model, I mean Jordan. What's your input on our kind of like? I mean that sums up our strategy. What are you looking at it through your eyes?
Speaker 3:Yeah, I mean it's really about I mean not necessarily time in the market, but paying attention to some of those market factors that you're talking about. Are we going to head into a widespread 2008 type event? Likely not. Localized corrections are going to definitely be a factor in the volume of real estate investments that are being made in any given area. So to your point now is a great time to jump into those other strategies. When competition is slowing down and people are generally taking a step back. Maybe they're taking more of a cash position right now, waiting on the sidelines for the opportunities to come up, which is definitely a smart move as well. But your money can never sit idle because it's losing value every day and you need to deploy it in some capacity, no matter what.
Speaker 1:Yeah, I'm with you. I'm so used to having Steve here. He would already have a question. We like we lay off each other and I'm like, oh, there's quiet for a second. There's no Steve. Because I'm looking at, I'm looking at Jake, like he's Steve and you're my guest, Jordan.
Speaker 3:There's a reason.
Speaker 1:Yeah, Anyway. So Hose Allen is. You know, like I said, I see a lot of, I know a lot of people have jumped out because they got scared or whatever it might be. It's hard to wholesale now because there's so many wholesalers. I see so many cars driving around. We buy houses with cash. They don't buy houses with cash, and I go to a lot of these houses also that these guys already went to and they just lied to these people. They promised them way too much money. They already held them up for the 60 days and now they come to me and of course I buy at the right price, but they're just out there. Everyone thinks they're a whore and they're not doing the right thing. They're actually messing up the customer or the homeowner. That that is distressed and it really bothers me.
Speaker 3:Yeah.
Speaker 1:I don't, you know, because you guys, you guys go to houses every day and when I walk in there and they're like, oh well, this guy was here and he told me I was going to get 100,000. Your house is worth 20. That's why it's sad here. Nobody looked at it. He has plumber came by, his roofer came by, you know, he lied, you know says, hey, I got my contractors come by, they had investors come by and they look at it and they're like I'm not buying this, I just sat there.
Speaker 2:Yeah.
Speaker 1:Until I bought it for 20.
Speaker 2:Yeah, yeah, that happens a lot. I think Jordan and I both get calls probably every day from new wholesalers that want to get started, and I do encourage everybody to. You know, do real estate for sure. I don't want to discourage anybody from starting, but definitely educate yourself.
Speaker 1:Join venture.
Speaker 2:Yeah, you have to educate yourself. Like you know, you go to college four years to get a degree in business, to get a management job right, and you make $50,000 to $100,000 a year. I mean, spend a year educating yourself on the real estate basics first before you just jump in. You should at least know, like, what you're doing, because you have real people's lives in your hand, a lot of people. The biggest purchase, the biggest sale they ever make is a home. So you know, you want to. You definitely want to set expectations properly. One of the things that Jordan and I always say is that we should make offers that we could actually buy it with right Like a price that we could actually buy it you know,
Speaker 2:Yes. So if you're making an offer excuse me and you're like well, I don't know if I can find a buyer for this, I don't know if I can close on this, I don't know if it's actually going to close, Well, it's probably not a good price If you have $10,000 in your bank account and there's a house for $100,000, a seller wants $100,000, you know that it needs $50,000 with the work. Whatever, make a $10,000 offer. You know what I mean. You know you can close on it.
Speaker 1:Yes. Or tell the people hey, I'm not going to buy this house, explain what you're going to do. They don't explain what they're going to do, they just say, hey, yeah, $100,000,. No problem, I need six months. Yeah, yeah it's.
Speaker 2:You know you want to set expectations, you want to explain. We don't buy every house that we come across, unfortunately, but we definitely will make you an offer. A lot of times they'll give me their price and I'll say, hey, you know, I don't want to lead you along for a month and you get all your clothes and all your items packed in a U-Haul and you're ready to move on to the next house. And then I say I can't close because that's too high of a price that you're asking. So what I could pay is this is typically and you know that's a number I know I can close on, that's a number that I'm very strong with and everything will work out fine but the number you're asking is just too high. So you know, if it doesn't work out, it doesn't work out. We can look at some of our other programs, such as terms subject to, to see if maybe one of those programs would work.
Speaker 1:And that's how you offer them. You give them a cash price first, and then you offer A, b or C or or. It really depends on this situation, I just assume.
Speaker 2:Yeah, it really depends how fast they got to get out. It's literally whatever would work best for them. Yeah, you know, like what will actually help them the most?
Speaker 1:Yeah, so we, just, we just solve problems. You know, you got to go in, you got to listen to their story, you got to figure out their situation, how fast they got to get out of this house or how long they have to stay in it. Because I've I've bought a house six months down the road.
Speaker 2:Yeah.
Speaker 1:You know I got to leave in March. Okay, I'll buy it in March.
Speaker 2:Yeah, yep.
Speaker 1:Done deal, you know. But I only do those deals if I'm actually buying a house. You know I'll tell them I could try to find them a buyer. But I can't say I'll buy the house in March, no big deal, but I'll buy it now. I'm not gonna try to find a buyer for March. I had a friend that did that and it just backfired. Have you had any? Okay so with wholesale, and have you come into any problems Like any nightmare stories? I know you guys have something.
Speaker 3:Oh, we have a ton of nightmares, not this one Gremlins, they're entitled searches that pop up and you gotta resolve and you know there's. You know you're told one thing for back taxes and it comes back another, and you know you gotta set the expectations with the seller ahead of time, like, hey, this is what.
Speaker 1:Because they'll always tell you they don't own anything. No, we're good, our taxes are paid up and I paid the water and the sewer. And then you find out they owe 10 years of sewer.
Speaker 3:Right. So then you know you're all. You're all patting yourself on the back because you did your part on the both sides. Acquisitions and dispositions you have, you know, a funded EMD with a buyer sitting at the title company. Everything's ready. And then, bang, title problems come up. You know those are definitely stressful situations. You have to have a really good title agent to help you work through those things. And then you know there's a one-off. You know lock boxes disappearing and items being removed from properties and disgruntled sellers coming up calling us and stuff like that. But you know you write them a little check and you call today.
Speaker 3:Yeah so move on so, but at any volume, you're gonna run into these things. It's just something you have to expect.
Speaker 1:Any nightmare visits like. You went to a house and it was just like dogs attacking your fleas. I don't know something good Tell them about the cats.
Speaker 2:Yeah, we recently did a deal in Scranton. There was like 25 or 30 cats in the house and it got condemned because of the cats. So they needed to do something right away. The seller was in poor medical condition and his sister actually had power of attorney over everything. So you know, all these cats are running around. So we had to deal with animal control, try to find these cats' homes. They had distemperment, which I didn't even know what that was until this situation, and they went to animal shelter and like half the animal shelter got distemperment. So anyway, there was a lot of different issues there. The seller just recently called me and said that he has his cats got buried under the parking lot next door and he wanted to dig it up to retrieve his cats. So you know, you encounter a bunch of different things.
Speaker 1:Wow.
Speaker 2:And you just a lot of people are, you know, in a tough spot or they're unsure of the process, they're intimidated by the process and they're looking for a professional to work with. They're looking for somebody to guide them and you know, just tell them everything's gonna be okay and make sure everything is actually gonna be okay. You know we helped these people move. I went there, I fixed their door, like the deadbolt wouldn't work. So I, like you know, fixed their door so the deadbolt would work. So you know we do, we get very involved and we do a lot in a lot of these situations, and that means a lot and that's why you get a lot of referrals.
Speaker 2:Yeah, but you could, you know, and you could bend backwards for somebody and and they don't care. And they don't care too, you know so.
Speaker 1:But you feel better.
Speaker 2:Yeah, it doesn't matter. I mean I go into every appointment. Everything I do is mostly self-interested.
Speaker 1:You know what?
Speaker 2:I mean, and I go into every appointment saying that like, hey, we're here to make money, you know it's. I'm trying to help you too, but me helping you is in my best interest.
Speaker 1:You know what I mean.
Speaker 2:So you know, that's kind of how we frame the whole situation. We're very authentic with it, Like, hey, we're here to make money, but we're also here to do whatever it takes to.
Speaker 1:To get you out of that situation. Yeah, and that's great. Because I come by your guys' office and I hear you guys talking to these people. You know you do a great job. I try to copy you guys. Be honest with you.
Speaker 2:We try to. We just have an actual conversation, that's all.
Speaker 1:You have to be honest. I think honesty's the best.
Speaker 2:Yeah, I think a lot of people that are new to wholesaling or new to real estate get too caught up in. I mean, you know, jordan and I were like this too, where you get scared before you make a phone call.
Speaker 1:Sure.
Speaker 2:That. So at a certain point you get to a point where you've done it so many times that it's like or your phone is just always ringing up the hook, so you answer and it's just like another call. You know what's going on, how can I help, and just having an actual conversation like how can I help and you've had that conversation so many times that you know how to respond to certain instances you can say it with confidence.
Speaker 1:So repetition is really you know the best way to learn and I know how to handle a person when they call. Some people call very aggressive. Yeah, yeah, you know back of my taxes, but what are you gonna give me? I saw on Zillow my house was over 400,000. You know, and you just kind of had to talk to those people and you calm them down and it works out for me anyway, and I know it works out for you guys Trying to think what else I wanna talk about.
Speaker 2:Well, I think a big thing to talk about is you know the current real estate market and how it's. You know being Go ahead.
Speaker 1:I saw you talk about that all the time, every morning on Facebook stories. Yeah, yeah.
Speaker 2:Jordan. What are your thoughts on the market? I think you alluded to it a little bit earlier.
Speaker 3:Yeah, actually I wanted to circle back to one point they were talking about a little bit earlier. When it comes to, like new wholesalers, you know getting in, they see, you know the gurus online where it's easy money, this and that it's not easy at all. There's a lot of different situations you have to learn how to deal with and follow up, and we talk about follow up all the time, but it's just so critical and not just saying like I follow up. Really well, you gotta actually follow up. We just closed a deal like last week that took over a year and a half to close. There was a healthy assignment fee on it and it was worth it for us to keep on it To the point where I gave the seller a ride to closing. He was handicapped. I had to put the seatbelt on him and take his seatbelt off when we got there. You got to go the extra mile.
Speaker 1:You guys, do you guys?
Speaker 3:really do. You have to go the extra mile to help. I'm glad you're my friends Get these sellers out of these situations. It's not easy and it's not quick money as quick as everybody thinks it is. It's relatively fast, real estate speaking, because real estate's a slow industry in general and I guess I can segue this real estate being a slow industry into market conditions and things. Title company Title company's being slow yeah.
Speaker 1:I don't wanna say no names in my building but I don't know.
Speaker 3:We know what we're talking about, but, yeah, title company's, yeah, they've been slower, which is surprising.
Speaker 2:A little bit surprising to me, because you know, transaction volume has dipped so much.
Speaker 3:Yeah, yeah, transaction volume. I mean there's still transactions occurring. There's still transactions occurring in 2008 and 2009.
Speaker 1:Yeah, and people are making money.
Speaker 3:So I do think Pennsylvania as a whole, maybe with the exception of Philly and Pittsburgh and maybe some more affluent areas, we're relatively insulated from large market corrections Now small 5, 10% corrections sure I think everybody's exposed to that as conditions change across the board with interest rates and LTVs and things like that, for investment loans, even to even new regulations, you have different seasoning requirements for refinances on Fannie Freddie now, and there's a lot of different nuances that you have to pay attention to in order to make sure that you're able to operate at the same level you've been operating at. And if you don't think you can do that, you gotta look at different strategies to implement into your systems to make sure that you have a reliable business with certainty that you can rely on.
Speaker 1:So are you guys helping out new wholesalers? Are you training them?
Speaker 2:So we do yeah, go ahead, Jordan.
Speaker 3:Well, we had a coaching program. We had about, I think, a handful of four or five students in it, and then we kind of segwayed out of that because it was just taking up a lot of time.
Speaker 1:It does take a lot of time.
Speaker 3:We really love doing it. It's something we really enjoy.
Speaker 3:However we have to focus on our core business, which is helping distressed sellers, and we kind of came to a happy medium with Investor Hotline, where it's a much, much lower price point and you're able to email and text questions into us as you're taking action, as you're doing deals, trying to do deals and market. If things come up and you're not sure how to handle it, give us a text or an email during business hours and we'll help you out. But are we gonna sit down with you for hours and do a presentation on PowerPoint? No, we just can't. We don't have the bandwidth for that. But we still offer a support service for people that are getting into the business.
Speaker 2:And you can find that on offmarketmentorcom.
Speaker 1:And you'll give me all that information and I'll put it on the bottom of the podcast, so people can click that especially if you're a new wholesaler. Reach out to these guys.
Speaker 2:And there is a free underwriting calculator, a rental calculator, there as well.
Speaker 1:Okay, I'm gonna go to that.
Speaker 2:Yeah, I've bought. Every duplex I've bought has been with that calculator, so it works.
Speaker 1:I hope so. So you guys are buying more rentals. You were saying too.
Speaker 2:Yeah, one of the things that we recently did is we came across a larger portfolio that was in receivership and instead of us closing on it, you know, just wholesale is one of the exit strategies If you find a good deal, try to close on it. However, you know, if it's actually a good deal, it's gonna close. So we had a 16 unit building. We're currently closing on a 42 unit building. So the 16 unit building closed at the end of August, I believe, and that we. So we found the deal and we reached out to one of our friends and they were looking for some larger properties and instead of taking an assignment fee, we just took 5% ownership in the deal and then, on the 42 unit complex, we took 10% ownership in the deal and that's supposed to close December 1st.
Speaker 1:That's cool.
Speaker 2:So you know that is another alternative to taking an assignment fee. When you're looking for a deal Like, you can ask for equity. Especially if your capital gains gets a little bit high, equity might be more beneficial than cash, and that's. You know, in the long run, we are buy and hold investors, so we're looking to build a portfolio and a nice balance sheet. So you know, that's one of the things that we did this year for the first time, where we took equity in a larger deal instead of an assignment fee, and we'd like to do more of that. We'd also like to take down those deals on our own in the future and so for 2024, we're gonna get more active with flipping and actually putting hands on the property and actually buying, as well as doing some of the other strategies we talked about with Novations and Wholesale.
Speaker 2:In general, we still have a buy box that you know. There's only a certain type of property that we're gonna buy and actually flip, which everybody has their own buy box. There's not, you know, and each one works for them, you know. So one property might be great but we just don't wanna buy it because it doesn't have off-street parking or something. So we'll sign that, but you know, I think if we have a couple flips, we've left a lot of money on the table with just assigning things. So you know, if we start flipping a little bit as well, I think it'll help with operational cash flow and stuff like that.
Speaker 1:Yeah, I went to flipping this year. That's like been my thing flipping and it works. I kinda teared away from wholesaling and just flip. But I'm flipping a lot and there's good money there and there's money that you don't make. Sometimes I've done a flip where just a couple thousand bucks when I could have wholesaled it and made 20 grand. But it happens but I still headed the game.
Speaker 2:It's really hard to do both. It's really hard to have the capacity to be able to field calls from sellers and manage flip projects and stuff laying on our team and expanding our capacity. So now that we've started to do that we have hired state side people, we have two new team members and as we train them up, expand our capacity, we'll be looking to get more active in the flipping space. I think that was one of the biggest reasons that we didn't really flip, because it is hard to provide a good you know business where you're dealing with a lot of motivated sellers and handling a lot of different deals, juggling a lot of different deals. It's really hard to do a project or do multiple projects on top of that. So now that we are expanding our capacity, hopefully we can do that.
Speaker 1:So you joined venture also at other wholesalers.
Speaker 2:Absolutely, we'll join venture.
Speaker 1:So if I had a, wholesale deal and I came to you because I don't wanna wholesale it. I give it to you.
Speaker 2:Yeah, if anybody has any deals that they need help with or they would like to join venture, we're definitely open to anything, but we do ask that you have your stuff together when you present the deal, and we're not gonna join venture on a deal that we think is locked up too high.
Speaker 1:So would you rather to deal them giving you a warm lead?
Speaker 2:Well, like hey.
Speaker 1:I talked to the person and then I come to you and say, hey, Jake, you wanna give this guy a call? They're looking for this and let you set the number if you're gonna run it.
Speaker 2:So I mean we only deal with motivated sellers. We don't try to convince anybody to sell their house to us for less than it's worth. We only deal with people that are actually motivated, that need our service. So if it's an actually motivated seller and the new person in real estate doesn't know to handle that situation, instead of them walking it up at a price that doesn't make sense, I would rather hop on the phone and talk to them and try to figure something out. But preferably you would already have the deal locked up and it's a good deal.
Speaker 2:Sure, cause you guys have a big list of investors, I'm sure yes we're primarily operating in Lackawanna, lizzern County, columbia County, coal townships, shumokan, mount Carmel, frackville, potsville, bloomsburg, danville you know all those areas all around 81, 80 corridor, northeast Central PA, and we have a bunch of different buyers that we work with, a bunch of different vendors that we work with, a bunch of different great professionals that you know we enjoy working with and you know we're looking to work with more. We're also seeing a lot of people come from New York and New Jersey into these markets as New York and New Jersey get over-regulated in regards to real estate, property law and property tax and you know tenant laws and all that stuff. So we're seeing a huge influx of New York and New Jersey people. That's one of the reasons we've helped fast in staying local to our markets and not trying to go to some of the other markets, like you know other businesses do.
Speaker 1:Sure, so you're trying to feed local. Yes, do you deal with more local investors than out of state?
Speaker 2:We would well, we wanna be the local market authority where, if you need to sell your house fast, or you're in a bad situation, or you need to sell your home in general, give us a call first, you know, see if maybe we can make a deal, an all cash deal, you know, even if you're listing it, give us a call first. So that's kind of how you know. We wanna be like hey, just call Jake and Jordan, call House Buying Solutions, call Yule Capital, see what they can come up with, you know.
Speaker 1:So, but they cannot be listed with a realtor. They can be they can be.
Speaker 2:Yep, we like paying agent commission, we love paying agent commission. So you know we'll work with any agent as well.
Speaker 1:So any real estate agent contact you. Yep, awesome, real quick before. I guess we're gonna wrap it up soon. But what's going on with the Bloomsburg one, the 20 unit? How did that go? That's how I met you, right. So what's going on with that place? Is it fully rented now? You enjoy it. It's making you money.
Speaker 2:Yeah, Jordan, do you wanna touch base on that?
Speaker 3:Yeah, sure. So just to quickly recap, if people aren't familiar with the first podcast episode, we were interviewed a little over a year ago about a 20 unit building in Bloomsburg, pennsylvania, that we acquired on seller finance note was a distressed seller Well, distressed in certain ways, not distressed in others. He wasn't really motivated by money, he wanted to free up his time to enjoy it with his kids and he kind of got the shorter end of the stick on this property because he had a very bad property manager that happened to be related to him who was embezzling money from the property and wasn't a good situation. So he was looking to sell it. He had some buyers lined up. He had an agent lined up right ago.
Speaker 3:I contacted him at the best time I possibly could have. I was just a cold lead that I got, I think, on Facebook marketplace and it was actually one of the units was being offered for rent and I'm like I'll just message this landlord quick and see if he has anything that he wants to sell. And sure enough, he talked to me about this 20 unit and, long story short, we were able to negotiate basically zero down seller finance note on the property 30 year note we paid a little bit of closing costs and some pre closing expenses like inspection and stuff like that nothing crazy. So yeah, we were able to get in that property. No, pretty much zero down.
Speaker 3:He also funded the rehab in second position so we did a quick cursory he cosmetic renovation on the building, got it fully occupied in about four months three to four months and since then it's been operating around 10 cap and we've had some challenges, like we had to do the one tenant right away that was growing weed in their unit and your standard 5% vacancy, generally 5% to 7% vacancy. We had a couple of bad eggs on month to month leases we had to get rid of. But we utilized month to month leases to get the building filled very quickly to make sure we made good on mortgage payment. So yeah, in the beginning we had a little bit of turn, some turns that were happening, but we got to stabilize them. It's running the way it should be running right now.
Speaker 1:So you're gonna keep it.
Speaker 2:We're going to keep it until somebody wants to buy it for double for 1.6 or 1.8 million dollars. So if anybody's interested in Bloomsburg property 20 unit building, 1.6, 1.8 will consider or hire.
Speaker 1:The link is at the bottom to reach them.
Speaker 2:Yeah, but that is a good property. You know we just want to continue to scale into larger assets, that 42 unit building. You know that's a great opportunity for us and we think we're going to get more opportunities.
Speaker 1:So you know, we're definitely that's better than a whole selfie.
Speaker 3:Absolutely, absolutely, absolutely so that's actually a good point, jake. I mean you look at this building and it's running. It's running good, you know it's cash flows. You could hold it forever, but you've got to look at your return on equity at some point too, because there's a really decent amount of equity in that building from because we bought it at a really good basis and we forced the force to value the property by making a cash flow again, which is how commercial real estate is valued. So if you're looking at a big chunk of equity, it makes sense to look at what that money could be doing elsewhere. So if it could be better utilized and a different asset, then put it there. Don't get hung up on holding on to properties because you think that you should hold it forever. You have to look at the big picture and if those dollars can work harder somewhere else, you've got to deploy it.
Speaker 1:Absolutely. I sold the three units, grant and yes, that was three units and I owned it outright. I paid cash, which was stupid and owned it outright, but I was after paying taxes, everything. I think it was like 28,000 a year I was making. I sold the place and now I've done numerous flips with that money and I don't want to say what I made, but I made good money. Yeah you know what I mean.
Speaker 2:It's anytime you're making investment, you have to choose between investing in, you know, this return or that return, this risk, that risk, like you know, if you have a million dollars, it might be best to just put it in a CD at this point. It's risk-free, right. So it really comes down on, like you know, what type of returns are you chasing, what type of risk fits your investment strategy, and you're always looking for a better investment, a better return. So you know, we are not the type of people that we want to hold things forever. We will liquidate when the time is right and deploy it into another investment that produces a better return, based off our investment strategy. And I think everybody should look at things that way. That's how investors look at things you know real investors.
Speaker 1:Real investors, yeah, I don't care. I might like the building today. I'll sell tomorrow if they got the right price.
Speaker 2:Yeah, of course you know, if you think maybe you hold that building and upgrade it more and more and more and you know it really depends on your strategy. That's what's so great about real estate is like you can do whatever you want. Yeah, I mean really. You know, jordan and I are in our 20s, right? So if we just hold that one building and this is the power of real estate too, guys- one deal For 30 more years.
Speaker 2:One deal, yeah, so we'll be 50. And you know that'll be bringing in 400K a year cash flow. It'll be worth like $4 million, you know. So we'll be millionaires and we'll be like set, just if we hold that one property for the next 30 years.
Speaker 1:And this is all because of a Facebook ad that Jordan called. Yeah, yeah About the one bedroom apartment for rent, just seeing that the landlord had any properties he wanted to sell.
Speaker 2:This is him messaging rental listings, which now a lot of people do that, because we've talked about that a lot Maybe we should have said that you should have kept that secret. Yeah, it's fine. I don't do it.
Speaker 1:It's fine because we still there's so much stuff out there, there's so many ways to reach people and you know, just by talking and getting out there. You know, you guys, that's why your phone rings Every morning. I see I watched Jordan drive to work and do videos hey, good morning everybody, and he's driving to work. And then I see this guy at Jake at the gym. You know, he's on the treadmill talking and yeah you guys are doing great, so we'll put all your info at the bottom.
Speaker 2:Yeah, we just got new AI glasses, so oh yeah. We're going to be live streaming more.
Speaker 1:Well, what did they do?
Speaker 2:So Meta just came out with these glasses that you could look at something and you could be like what is that? And it'll say like oh, that's.
Speaker 1:So that was like the Google glasses. Google made that originally a few years back.
Speaker 2:These are like Ray Vans, though, and you can live stream directly through that.
Speaker 1:Well, how do I get?
Speaker 2:them, you're not going to tell anybody, I can pre-order them, so they're coming after we're 23rd, so we're excited about that.
Speaker 1:I'll wait till you get yours. I'll come to your office and then tell me what I'm wearing.
Speaker 2:We're half cyborgs, but yeah, we're looking for. You know, if anybody has large multifamily properties, we're in a position to buy. We have unlimited capital to buy if it's a good deal. So definitely reach out to us. Anything above 10 units anywhere in Pennsylvania and then if you get like 50 units or more, we'll look at it anywhere on the East Coast. So definitely send us any deals or leads.
Speaker 1:So you want to send out your phone number or you just want to put the link.
Speaker 2:You can email me at, or Jordan at, jakeeagle-capitalco. So, eagle-capitalco, jake or Jordan. You can also go online. You can find us at housebuyingsolutionspacom housebuyingsolutionspacom. It links to our Facebooks and phone numbers and all that stuff. So, yeah, definitely reach out to us if you need help with a deal or if you have a deal or if you have a large multifamily deal. This is what we do, this is what we live for and we're interested in working with anybody.
Speaker 1:Excellent, jordan, you got anything to say.
Speaker 3:I think that pretty much sums it up. We love real estate and it's what we're going to do for the next 50 years of our life.
Speaker 1:So we're no, you're not.
Speaker 3:More than willing to talk about it.
Speaker 1:Another five years, you guys will be billionaires.
Speaker 2:We'll still be doing real estate and Jake's going to put his money in CDs. We'll get the note in testing at that point.
Speaker 1:All right, thank you. That's a wrap. That's the Real Estate Community Network podcast with Jake and Jordan. Thank you guys, it's been great. If you want to contact them, I'll have all their information listed in the bio down below, so just click it. They'll have their email, their phone number. Go, reach out to them. Thanks again for listening. Make sure you follow us on Facebook. Real Estate Community Network PA. I'm Mike, steve, my partner, and we'll catch you in the next episode.