So the big question is this how are real estate investors who don't have a ton of free time, don't have access to off-market deals and didn't start life on third base, how do we grow a real estate business conservatively to support our families, finally leave the corporate rat race and build a legacy? That is the question and this podcast will give you the answers. I'm Ed Mathews and this is Real Estate Underground. This is the Real Estate Underground Podcast Show number 73. Greetings and salutations, real Estate Undergrounders. It's Ed Mathews with the Real Estate Underground Podcast. Today is a really cool and different podcast because we're actually recording two podcasts at once with my friends at Bucks and Brews, dave and Nick. welcome to the show. Thank you for joining me, and why don't you do your intro and then we'll get cooking.
Buck and Brew$Well, thank you for having us and welcome back to Bucks and Brews. Nick, what are you drinking?
Buck and Brew$Oh, i'm drinking right brain CEO's stout here at one o'clock in the afternoon because I'm the responsible adult of the group.
Buck and Brew$Yes, you are Me. I just have water today because I have to go coach high schoolers and I don't need that on my breath.
Ed MathewsI'm a seltzer guy because I too have a softball game to go watch and my wife tends to look at me funny when I show up with beer breath. Funny how that happens.
Buck and Brew$Thank you so much for having us on. I'm really looking forward to this episode.
Ed MathewsYes, so it's an interesting mix because, nick, you and I are Real Estate guys and obviously we both have other holdings. Dave, you tend to focus on stocks and ETFs and bonds. I assume I do. Yes, let's start there. I don't know a squad about crypto, so we're going to avoid that, but the fact is that, from a stock market perspective, what drew you to that asset class as opposed to Real Estate or something else?
Buck and Brew$So I've always loved money. I'll just say it that way. I've loved money, if you like money, and I was always good at finding ways to make more money. And I got to the point where, when I had enough to start investing, i'm like, screw it, i'm just going to start doing this, and decided to go back and finish my finance degree. So I've always been smart. I just didn't like school, but when you pay for it, you tend to pay attention. So graduated with high honors That taught me a lot of investment options.
Buck and Brew$And then Nick and I love to talk about investments because we put our hands into a lot of things. I mean, he does a lot of real estate, but he also has a lot of other investments as well. And at this point I was paying for my daughter's college, so she was saving all of her money. So she amassed a decent amount of money and I started investing for her so that she could retire early. And I got my hands on everything You know. I use some of the newer apps that are out there, like Stash and Acorns and Public. I invest in peer-to-peer lending with Prosper.
Ed MathewsSo how does that?
Buck and Brew$work. So you have to fund at least $25 to whatever loan you decide to fund And they will give you the details of the person. So they'll give you what they do for a living, how much money they make in a year, how many delinquencies they have. a credit score a FICO credit score, then a Prosper type credit score where they have different options for rating And then you just figure out if you want to invest in that particular loan. I always look at what do they do for a living, how much do they make in a year, how many delinquencies that they had. I really don't care what their credit score looks like. If I feel they have the money to pay this back, i have no problem throwing money into that loan. And I mean it's a three to five year loan. Some people pay it off sooner, so you don't make quite as much, but interest rates range anywhere from five to 30%. So I mean it's a pretty good return on investment as long as they don't default.
Ed MathewsSo I'm curious about the performing numbers. Do you have any insight into how many? you know what percentage of those loans actually perform?
Buck and Brew$I don't, i only know what I've dealt with and I probably funded, i'd say, in the last three, four years. I funded anywhere from five to 20 in any given year. Most of them paid off early. So my returns obviously aren't as good as a 10% return over five years if it's paying off in a year. But I mean it's still, you know, a lot of times outproducing the market, especially, you know, the last 18 months or so the markets are down.
Ed MathewsYeah, absolutely.
Ed MathewsAnd so you know it's interesting because you know a lot of real estate guys I know also invest in notes and you know prospects, kind of a backdoor way of doing that right. And so you know, and the other thing that's interesting that I kind of popped into my head when you were talking about vetting your, the folks that are borrowing money from you it's, you know it's a similar process to how you know guys like me and Nick evaluate tenants and perspective residents, right, you know, the fact is that I don't really care about a FICO score. I do, but you know there's so many people out there who have been dinged up because you know they had to take their child to the emergency room and and they got whacked by the credit agencies that way. But you know they make the car payment every month. They make their. You know they make their insurance payment every month. They were paying rent on time, but they have a 580 score because you know the local hospital jacked them up And so and that's, there's a lot of that out there, right, yeah.
Buck and Brew$Nick and I talk about that all the time because when people are like, well, i have all this medical debt, he goes, yeah, i don't care. Have you you care about medical debt?
Buck and Brew$That's usually one of the biggest criteria, as I tell people, like, as a landowner, we have to have set criteria. But what do you look at when you look for debts? Well, i mean, if you have college and you have medical, it doesn't bother me, because I assume everybody has that Right. Like I don't look, like I just assume that that's what's going to be out there And the things I look for are the things that you listed. Plus, I look for consumers, energy for us, dte, you know, see your utilities right, yeah.
Buck and Brew$If you can't pay your, if you can't pay your, your housing bills, then I'm not renting you my house.
Right, right, and you know, so I look for. I look for big things, right, i look for, you know, a clear criminal credit. You know a criminal background, right, and I don't care about the fist fight you got into when you're 18 years old. I care about the, you know, the liquor store you knocked off last month, honestly, or last year, right, and so you know, i mean, there's a lot that you know guys like us can be flexible on, because you know, the fact is that it's real, right, life is real and stuff happens, especially when you're young. It's a miracle that I graduated from college without any major felonies on my record, and just mainly because of all the dumb stuff I did. You know I just did. But but you know, i'm here to tell you and thank God the iPhones didn't exist back in the 90s when I was in college, because that would have been a problem. But but the fact is is that you know, you know these are like Nick.
Ed MathewsI think you and I rent to very similar types of folks. You know they're good, hardworking people, right, they crank your rent, they crank a wrench for a living to fix your car. They pour your coffee in the morning at the, at the local diner. They check you out at, you know, target or Walmart, and they probably have. You know, each of those individuals probably have two other jobs you don't even know about. Right, so you know, the fact is is that our you know, our focus here at Clark Street is to, you know, we buy crappy apartment buildings from landlords who aren't really good at their jobs And you know, we make them. We make those buildings clean and safe and then we upgrade them so that folks can be proud to live there And we hopefully live. They live there for years. That's the idea, right? This turnover is expensive.
Buck and Brew$Yeah, and that's the hardest part of our game is turnover. You know we're talking I, you know I have an average of eight years right now. Currently is my average turnover right now, and it's probably higher than that. It's phenomenal, you know, and we talk about it in our podcast all the time. I don't get max rents right. I'm you're going in and you're renovating everything. I'm more more focused on functionality, right, and if it needs to be fixed, right, i always fix everything. But I'm. If you have a, can you say it's a yellow toilet? What's the other word for yellow Almond? Almond, right? Yeah, let's say, if you have an almond toilet and it still works, i'm not changing it out for a white one just because it's time to have a white one. Like, that's not how I function. When it breaks, yeah, okay, i'll update it, but really a thing of the day to me. It functions, it does its job.
Ed MathewsYeah, as long as it doesn't leak water, it stays.
Buck and Brew$Yep, right, a lot of 너무 in my opinion, then a good deal. Okay, i don't get the highest rent, i don't hit market, I'm just below it. Right, because I want to offer the best quality thing at a very fair price.
Ed MathewsIt's a value exchange, right? Yep, simple. And you know, candor, we don't get top rents either. I don't want to, because the fact is that I'm you know, one of the retention strategies is that they can't find another apartment as nice as the one I've that they're living in right now for the price that they're paying. So I'm fine at, you know, 90, 95% of market, you know, on the high end, which is usually 85 to 90, right, i'm great with that.
Buck and Brew$That's perfect, right, like we have the same strategy in that sense, because I have friends that are we're in Grapp, it's Michigan, right? So I have friends that are in the downtown area doing some of the biggest things and they're like, man, you know, it's great, you know I get 2,300 or 2,500 a month for rent for my two-bedroom and just like crap, that's awesome. But you know they're going in and they're putting in you know, beautiful tile that cost them seven bucks a square foot. They're doing all this and they're like, yeah, but you know, oh, this person's moving out. Yeah, but I'll fill it with this person. I'm like that's the problem you're going to have.
Buck and Brew$Right, i look at it when you're in the high end market, like that, you're also dealing with the same person that leases a car. Okay, they want a new something every two years, right, two to three years. And so, hey, oh, gray and white, that's no longer the thing. Right, i still use gray and white and all my flips, oh, hey, i want. You know, the blue cabinets are now a thing, right, these dark wounds. Oh, i'm going to go into that place because they're willing to just get up and go to the new, better thing, and I don't want that turnover. I don't want to sit here and have to change colors. I don't want to do anything Again. I'm going to offer a grayable gray on my walls, i'm going to offer bright white on my trim, and it's just going to function.
Ed MathewsYeah, we're Benjamin Moore. paper white every wall and a bright white trim semi gloss on everything else.
Buck and Brew$Yep, let's say, and when you can tell you, you tell you've been doing it a while, when you know the colors of your paint, right, play it simple. No, and it was funny because for the longest time I used the antique white because I didn't have to think about a color. It just they sold it in five gallon buckets. Everybody's like, well, why do you use this? And I was like, well, it's got a little brownish tint to it. And honestly, i picked up a five gallon bucket for seven bucks on clearance at Walmart and that's why I have it And it worked and I just stuck with it because I don't have to think in my brain. I'm too stupid. Like, plain and simple, i don't want to think.
Ed MathewsAbsolutely. And you know. The other part of it is you know, not only do you not have to think, but your guys who are doing the painting and everything, don't have to think either. Right, they know? you know there's they come into into our shop. There's 10 gallons of the exact same paint. They mix it up and they go and they paint the place that needs to be painted. That's it, yep.
Buck and Brew$And sorry to cut you off, and that's when you think about that. Right, like I just I didn't make a mistake. but I'm doing another flip right now And the house across the street was done with all my original stuff, right, gray floor, you know all the same colors. So I kept the walls the same. But I decided, hey, i'm going to do oil rub bronze fixtures instead of my normal uh, brush nickel. Because my guys know, hey, they go to. They go to Menard's Walmart, home Depot, anything, they just look for brush nickel. They literally grab the exact same two pack product. They don't call me for these stupid questions.
Buck and Brew$Well, i changed things. So now it's me that has to stay here and spend so much time. And then I was like crap, i gotta do these. door stops stupidest door stops to. You know, i had old window locks or whatever, some. I put some new windows in some and I go buy new white things. And I was like man, i have to stay here and think about all this over again where my guys originally it's just hey, they know, they just go buy it. That's what it is. You can't go wrong Playing in some and when you don't get asked a million questions every day about. What do you want here? What do you want to do with this? What do you want to do with that?
Ed MathewsWe do the exact same thing. We do the exact same thing. It's the exact same cabinets, the exact same vanity, if it fits, if it doesn't fit, there's the exact same pedestal sink, the exact same luxury vinyl flooring, the exact same paint, the exact same fixtures. At some point I'm going to get smart and start buying in bulk. I actually don't buy in bulk, I probably should.
Buck and Brew$Oh, you definitely should. So I bought 500 boxes. So my LDP we bought 500 boxes because it was actually clearanced out. I used it for so many projects and then all of a sudden it went to like 72 cents a square And so I bought it all from every single Lowe's that was out there and got it all shipped to my mom's garage, and you know. So here I am and I went through a bunch of flips using it And I finally am on my lot And now I'm like crap. I have to go rethink about what LVP I want And like how can I find this? So that's my response. Yeah, every two years now I have to go figure out what color I want, but really I try to use the same one on a constant basis.
Buck and Brew$I love the stupid shit we get excited about, so, like your locks that you got the other day. So, yeah, you got so excited, so I know in my house I've upgraded to the keypads for locks. Yeah, same Nick went to Home Depot, yeah, and found a whole bunch of like $100 locks for 20 bucks.
Buck and Brew$Yeah, a little bit. They were 80% off, so I got it for like 20, 22 bucks or something like that.
Buck and Brew$And literally bought all of them. Just me with a cart full of locks and and was so excited about it. Yeah, because we get excited about stupid stuff.
Buck and Brew$Yeah, save like awesome.
Ed MathewsYeah, Because you didn't you didn't spend 20, you saved 80, 50 times Yep.
Buck and Brew$Well, we do We talk about that all the time? because our wives are literally the same person and we're kind of the same person And our wives will go shopping at the grocery store and they'll come home and go, look, i saved $200. And we're like, yeah, but you spent 150. Right, i could have saved you $150. And then he turns around and does the same damn thing And he's like look at what I saved, yeah.
Buck and Brew$It's my first time being able to do that. But, it doesn't difference when it's my business versus myself. Right, Absolutely.
Ed MathewsYeah, I'm gonna. So I spent like 24, almost 25 years in corporate America And I was selling software and consulting services around procurement and sourcing. So I'm totally wired to. You know, if I can get that thing for five cents less, that's a huge win. Right, It's just the way I'm wired. So I hear you.
Buck and Brew$Yeah, we're kind of wired that way. I have to tell this story please. Nick had a dentist bill. It was $80. And Nick and I are notorious for negotiating these things. So he literally called them and they're like well, no, we're not going to give you a discount, pay it. or you know, just just pay it. And he goes all right, i'll send you a dollar a month until it's paid. And she goes what He goes I'm going to send you a dollar a month until it's paid, if you won't give me a discount. And she goes uh, what are we talking about here? He goes I don't know, i want a discount. make it less than $80. I'll pay the full thing right now, otherwise you get the dollar a month for 80 months. She came back on the phone a couple of minutes later and she goes will you pay 75? He goes sure.
Buck and Brew$Yeah, it's just and you see the expression through the phone just like is that cheap? Yes, i am Right.
Everything is negotiable, guys. You clearly understand that. So so how do you guys you know when you're, when you're talking about you know the different things you're investing in? um, you know obviously one. You know, uh, nick, you had said, prior to us hitting record, i bet, uh, that you know one of the cool things about real estate is leverage right, being able to control a $100,000 asset for $3,500 bucks, right. You can't do that with stock right, but it's it's far more liquid, right. So if I need, if I need my $3,500 back, i can go sell those shares and and go get them right And go get that money. So you know how do you guys reconcile the two differences in terms of your um, you know your investing approaches.
Buck and Brew$Um, i would say, when it comes to stocks, we are Absolute opposites And I would say my stock strategy is way more like his real estate strategy. I I'm a buy and hold person. Okay, i do my research, I decide what I think that's going to be worse Worth it. I mean, if it gets looking too bad, i'll dump it if I have to, but for the most part I'm going to hold on to it for years. That's how he is with his real estate. Yeah Time His stocks. On the other hand, he'll he's day traded before he. He will hold it for five minutes and then get rid of it and then buy it again three minutes later.
Ed MathewsHow does that work Exactly? Like David said no, no, no, i mean it. does it work well?
Buck and Brew$Um, it did for me, Yes, But I write the advice that you hear from him, And so financially it worked for me Okay. Um, and again, this was just, I didn't intend to day trade. So when I first started out, um, I don't know, I had like 4,000 bucks or something. I was like I'm just going to try doing some trading. Well, you know, I, I have really high anxiety, which is surprising. But, um, so I'm sitting here watching this thing and I was like, Oh, all right, I made I don't even know like 200 bucks to sell, Um, cause I'm comfortable and happy because I see it, I see it start going lower And once you make 200, it doesn't it's. You don't make money until you sell Right, That's even a real estate. You don't really make money until you sell. For a statement Um, well, everybody says how you make all your money when you buy, but, um, really, the money's not actually there.
Buck and Brew$So, uh, I would just sell And then, in order to day trade, you have to do re or more buy, sell transactions in a 24 hour period. And, um, so I, you know what I would do is all right, I buy it, I sell it at time And then, if I got risky. I would buy it again and let it kind of go overnight if I felt comfortable, cause you know it was closed and I was too stupid. This is how dumb I. I just got lucky, Okay, But it realized that the market kept trading at night.
Ed MathewsI just thought like once once fall, yeah, that's it Yeah.
Buck and Brew$So I wake up and I'm like all right, we're going to start right at new. You know, um. And then, finally, you know, i was like man, i'm doing well. So I was like well, you have to 25,000 bucks in there. So I'm talking to my wife and I was like, hey, in order to be a day trader, i have to 20, 25,000 bucks sitting there. I don't have to actually use it, can I? can I put 25,000 bucks there and then just just spend my four grand? She's like fine, well, you know, conversation next is like Hey, i'm spending eight grand, i've met, met 13,000 of my money in there. And uh, you know, i just kind of kept going.
Buck and Brew$But so back then I was working from three AM to one PM every day, and so I was day trading from nine o'clock till one on the company's dime which I don't work for them anymore, okay. And then I used to go home and take a quick little nap and then be up for the night. I'd sleep for about two hours there, or one hour there, than four hours at night. Well, what I found was I'd go out to dinner with my wife and it wouldn't be eye contact, it'd be Oh crap, what's my stock, doing Like I'm sitting here just asking Did it work? Yes, financially, i did well. Did I have a life? Not at all, did I. Like my anxiety wasn't worth it? My, like just the whole man. Like when you're spending 25 K or even 10 K, like your heart's just pumping Cause it's like a black or red at this point. Right, like you know, i do have index funds and stuff that I really the only time I look at them is right now we just mentioned, it's all hop on and be like, oh yeah, it's going okay, but I have other stuff. But really, um, you know, i look at it and go all right, i'm.
Buck and Brew$And then I started learning on the company's time while I was there, just like researching. You can join chat rooms and you find people that you think they know what they're talking about and does well, um, you know, i hit one, hit one. I hit one. I was following these guys and you know it jumped. I got in at like $22. Next thing, i know it jumps to 40, 80, a hundred and something dollars Closes. I was like Holy sh, i just made so much money very, very quickly.
Buck and Brew$Well, that next morning they make an announcement that a company, a company bought 50%. I don't even know if they bought the whole company. What happened? Basically, they've valued at $25. Oh Christ, and I was like Holy crap, like so I didn't realize that you could actually sell at night, right? Um, it's just a different call thing. You, you said it, and you have to just get somebody to buy it at that price, like specific set. When it's open, they tell you what somebody's willing to buy it at. It's completely different. Um, so right, it opens and it's literally just plummeting and my heart's just dropping because I just, i mean, i was up a couple hundred thousand bucks, i'm not going to lie about it, but by the time I got the sell, i only ended up like up I don't know $1,600. Right, and here I was up 160,000. Like, i had, i had, i literally I had enough money to walk out of my job. that second versus, oh crap, i just made a bonus, right, and I was like Holy sh And I took screenshots of everything, like show it and that's like told my wife.
Buck and Brew$I was like I don't know what to do wrong. So I was using TD Ameritrade, which gives you the first X amount of months or 500 free trades, and this and that for the beginning. And uh, he's like how do you like it? And I was like, honestly, i was up this and this is what happened. He goes Oh, dude, you could have just done this, set it and said, hey, it's at 107. If you were okay with selling it for a hundred, you could have set it here. Somebody would have bought it overnight or something like that. And I was like shut up. And he goes yeah, now, you know, for next time. And I was like I don't know Right Right.
Buck and Brew$Next time you're up a hundred and something thousand dollars. But just my, i mean, i tell you my heart was beating on my chest So it's a rush to me, i and I, i like to have educated rushes, right, real estate's fun, flipping still takes time, right. And but this I mean it happens in seconds. Literally every second the stock is going up, down, up, down And you figure out and you do research. And it's funny because you research companies, like fully into them Hey, what's going on in their life, what's happening here, what's it doing this? Like, um, medical, right. Hey, when COVID was a thing, anybody that owned Johnson and Johnson, right. When they got the first thing, boom, that shot up because everybody thought it's going to be huge.
Buck and Brew$So you know, if if a company, let's say Nike, goes and gets sued and does all this, well of course they're going to, they're going to go down, and that's where you want to buy is the lowest point, right, well, you're hoping that they, if they win their lawsuit, they go up. If they, if they lose it, then they stay down, might go lower, but eventually Nike's a big company, it'll come back up. So this use kind of you, kind of focus on you every update And because we're so naive in this world that we think the world revolves around what we focus on. There's somebody that focuses on every business and everything, and there's a news article that will come out for every business, Right? Yep, i was in the trucking industry And so I mean, somebody's job is literally to be like Hey uh, town air freighter.
Buck and Brew$You know FedEx. Fedex got sued by this. Okay Well, fedex is a great company. Like I'm going to buy it at the low and then try to go high, type of thing. So that's just literally what I spent my day doing. Yeah, i did it for about four months, made good money, but couldn't do it anymore because my, my anxiety was too high.
Ed MathewsYeah, well, that's, and that's a real thing. I suffer from anxiety myself. So it's one of the reasons why I'm a long-term investor, cause I just, i like the uh, i don't, you know, the thing I love about real estate is that it's it's tangible, right. You can go put your hand on it, you can paint it, you can sweep it, you can fix it and you can make it more valuable. You know, and for that dollar that I'm investing in that crappy apartment building, um, you know I'm, i'm hopefully getting $4 of overall value that I'll grow to five, six, seven, $8 over the course of time for the same amount of debt payment I make.
Ed MathewsYou know, today, you know we were talking before we started hit record about, you know, adjustable rate uh mortgages and, um, you know, i've done them strategically but, man, they scared the hell out of me. I'd rather put it in a 30 year note and just let it ride. And you know, if I refi, i refi, so be it. But it's, uh, you know, i, i like the certainty of it And I, you know, when I'm putting that dollar down on a, on a property, as opposed to putting that dollar in GE stock and hoping Larry Culp knows what he's doing um, the CEO there and, uh, you know I, i, you know, a, i don't get leverage from from stocks, but B I I. Also, you know I'm I feel like I'm betting on someone else's capabilities Yes, stock where I'm, whereas with me I'm, i'm betting on my own capabilities on on the on the real estate side.
Buck and Brew$Fully agree Yeah.
Ed MathewsSo so, dave, how do you manage risk, you know, when you look at at stocks. I mean, obviously you're doing your research as well, but I'm just curious how you approach it.
Buck and Brew$I try to diversify myself a whole lot, which is why I have a lot of different pools. I use to invest in that way. You know, if, if Nike takes a shit, i have eight other stocks, that'll, you know, crop that up. Right, and, like Nick said, i I am a huge fan of buying low.
Buck and Brew$I took So pandemic hit and my daughter had about $30,000 just sitting in a savings account, earning almost nothing. I said I'm taking 10 grand. She goes, okay. I said, do you even want to know? And she goes no, i trust you And I dumped it into, i want to say, about 25 different high dividend paying stocks.
Buck and Brew$Johnson and Johnson was one of them. Cvs was another one of them. Several medical companies I bought a bunch of ExxonMobil for her. At the time ExxonMobil was probably around $40 to share And I would assume it's around 80 right now. Yes, i mean She's probably made $12,000 and some of them didn't hit. I mean some of them have been, you know, poor investments 103. Okay, 103. But what I try to do is put the money in a whole bunch of different places. That way, if something isn't going well, i have something else to prop it up later. Right, you know we're big fans of Betterment. We both have investment accounts with Betterment. We both have Roth IRAs with Betterment. I invest in Fundrise, which does REITs, because I love real estate. But I don't want to deal with anything, i don't fix things, i don't want to have anybody call me, i just want something to make money.
Ed MathewsRight, mailbox money, yeah, right on, yeah, i mean. So that's and that's the world I live in, right Is? you know, from a syndication perspective, you know someone, an investor, dave, comes along and says, hey, i got 10 grand or 25 grand or 50 grand or whatever, and we have a project cooking. And then you know once that once that property turns cash flow positive which usually happens fairly quickly you know, on a quarterly basis Dave's getting a check from us And then at the end of you know, somewhere in that three to five year range, we're either selling the property and Dave gets another big check from an equity perspective and he gets his money back, or we refi out and same thing happens. Right, dave gets a big check and gets his money back, and you know, we continue to manage the property as an asset of ours. And it depends on the deal, right, it doesn't happen like that all the time, but but you know, typically the cleanest way is just to sell the building. And you know, part, friends, and it was great, let's go do it again.
Ed MathewsRight, yeah, but but, yeah, i mean, the mailbox money thing is huge. And you know, even me as an active investor, i'm not pushing a paintbrush, I'm not swinging a hammer, you know, i hire guys who are really much better at it than I am. Right, i mean, yeah, could I, could I, could I install trim? Could I, you know, put it, install cabinets? or you know a vanity? Sure, I've done it Right, i've flipped. You know dozens and dozens and dozens of homes, but the but. The fact is that I'd rather hire somebody, for you know a fairly reasonable number to who's going to do it better and faster, which means cheaper.
Buck and Brew$I'm going to do it. Well, let's say there's the rule of three, right, so you, you get. You get good quality, you get a fast price or a fast job done, or you get a cheap price. Right, so you get to pick two or three, right, and so out of those two, right. So if you want, if you want it done quick and cheap, the quality is not going to be great, right, but if you want a great quality and you want it done quick, it's going to cost you a lot of money, right, you know, to add under that, like it's been a bit, it's been quite a while since I've done anything. You used to quite a bit I did everything, plain and simple, And then.
Buck and Brew$So I retired for a little bit three years ago Yeah, Yeah, I was right when COVID. So, when I got fired, retired, went back to a. I worked for a property management company because I wanted to know what it's like to manage 450 units. So I went and did that. There's more to that, But anyway, I worked for a property management company, and then October came and I re-retired And I told myself I was like all right, what did I do right last time?
Buck and Brew$What did I do wrong? And what I found out is I have guys willing to work for me, to show up. They're doing good things, They're flipping my houses for me And, yeah, I can go do stuff, and I'm there, Like I always check on my projects, right, I'm constantly there because I believe if your hands off, you'll never get things done. That being said, though, is I realize that my I've never had my contract. Well, I've had one contract to bring me a deal, but I'm really good at acquisitions And I love doing it. So go out and find the places, go out and be the guy who's getting these guys to work And, while it works, run with it as long as you can as fast as I can, right. So that's what I decided to do.
Buck and Brew$As much as I and you know I did I tore up some steps like a month ago or two months over, long ago than this project Just because I was like, man, I haven't, I don't feel like I've gotten anything done right, I didn't buy a place or whatever. So sometimes you have to get a win, and a win can come as small as hey, I painted this wall, That's official, like something's done right. I changed this light fixture, I changed an outlet. I went and tried to change an outlet in this place and the wall was warped and this and that, And I was busy answering phone calls and I was like F it my contract, you can deal with it. And so that bugged me even more because I feel like I didn't accomplish shit. And so finally I tore off the stuff and I was like great, I've done something. You know like physically done something.
Ed MathewsRight, well, it feeds the caveman in me too, right? You know it's like yeah, i changed that switch. All right, i can go back to my desk now.
Buck and Brew$Yeah.
Buck and Brew$I'd say I do want to hit this. Yeah, i'll add your first lease ever, oh all right, so this is one of my favorite stories.
Before we talked on there you had said one of the biggest reasons you do this is to give back. It's plain and simple, one of the big reasons Dave and I do this right. So when I first started real estate here I am a young, 21 year old dumbass kid I owned a five bedroom, two bathroom house in a very nice side part of town, but it was a foreclosure, so the house wasn't great at the time. Again, i have a small mortgage, whatever I somebody on Facebook had posted hey, i'm looking for at least a four bedrooms, and I'll just plain and simple numbers. My mortgage was like 600, right, somebody goes hey, i'm looking for a four bedroom, willing to pay 900 bucks, and I knew that at 60,000 bucks at the time, that's a $600 payment. So I, this is back in 710. I go find a duplex for 60 K. So I reach out to the person. I was like hey, we're actually going to buy this duplex. If you're serious about renting this house, that'll make me 300 bucks. And so she's like yeah, let's do it. So, literally, grab a line piece of, grab a notebook, right, i grabbed a line piece of paper and on my kitchen table I wrote I, nick, will rent this house out, the address for $900 a month And we both signed it like a bill of sale, like everything, right? Um, so I go, you know, and stupid me. So I go get my, my duplex and I go to closing and they hand me the lease that's in place for the guy downstairs. I had to kick the guy upstairs out And and it's like five pages. I didn't even look at it, right? I was like, whatever cool, i got a lease. I don't fucking know what this means.
Buck and Brew$Six months into my investing career, My wife's grandfather goes Hey, i have a friend that owns some real estate. Would you want to go meet him for breakfast? I'll buy. And he her grandfather, saying to a guy he's like well, you know, maybe he can teach you something, maybe you can teach him something. And I'm like yeah, me teach. Like I was like dude, you've done this for longer than two days, you've done more than me, right? So we meet and he goes all right, let me see your lease. And I hand him this piece of paper and he laughs and this is like a 70 year old man, right, 80 year old guy. And he's like geez. And he hands me a six page document. That's a lease, right? He's like here, this is a lease, that these are called addendums, you're going to need these. And I was like, hmm, he goes. Let me know when that one blows up in your face.
Buck and Brew$So three months later, the tenant goes Hey, i, i can't afford to live here. It's the winter house, the house is too big to heat, and all this and that I didn't run background, i didn't run credit, i didn't ask them for proof of income, i didn't do shit Right, i just took a person's word on Facebook. They could afford to pay this amount of money. What could possibly go wrong? Because I didn't look dude, because, at 21 years and me being Why?
Ed Mathewswould you know?
Buck and Brew$If I, if I told you I'll pay you this amount of money, i'm going to do everything in my power to make sure that I pay my debt, because that's who I am as a person And that's who I assume everybody is in this world. Right, like I said, this is my word, This is what I'm going to do. So it blew up, and so my wife and I, because we moved into the duplex to get the three and a half percent down. So we moved. I was like, hey, do you want to live here? And now I know a little bit more of what I do. And we can. We can cash flow over here or we can just rent this thing out.
Buck and Brew$And she's like I'd rather go back to our big house, because we moved into two bedrooms, one bathroom versus five bedrooms. Yeah, we'd, you know, we'd have kids or anything at the time. but so we moved back to our big house and, uh, you know, my, my mentor come to find out he owned about 680 places by himself. At one point. That was as high. So he was a player.
Ed MathewsYeah, i knew what he was doing?
Buck and Brew$Yeah, a little bit. Um, i've bought a few buildings from him since, but he's fully retired now. I doesn't own a single thing anymore. And but back then he's like Hey, if you have any questions or whatever. Or when he told me Hey, when this blows up in your face, give me a call. So I was going to rent my place And so I'd call him. He wouldn't answer and get a call day later, or something like that, you know. And now I mean I'll probably do it after this because we're talking. I haven't called him like week, but now it's like if he calls her, i call. We're both just answering the phone, nick, well, how's it going? Great man, like.
Buck and Brew$And so I wouldn't be successful without other people in this game. Right, i didn't know when I bought my first house, which I live in a. Now it's worth 300 K. Right, it's a brag, huge, but I paid 86,500 for it. Right, there's a foreclosure granted. Back then it was worth, let's call it, 230. I don't care, but I didn't have that kind of money and I had to. I had to close in two weeks.
Buck and Brew$So I posted on Facebook Hey, i got a deal I can make, you know, each of us, 50 grand. I'd love to buy the house If anybody knows how to help me. Person on Facebook is like Hey, i know a hard money lender, you might want to give him a call, this will help out. So I call my call, my mortgage guy and was like Hey, this he goes. Yeah, i've heard of that. Great, we can start your because you're going to move into it. We can start your refi right away after paying a hard money lender. Now finding out what they do, i'm doing all this. You know I ended up paying one on one for my house and you know so. I had $14,000 of fees but I got into it with zero down, right And simple, like. But it's just literally just asking people this, quite like asking when I have a problem. I try to give everybody advice. Everything answered, yeah. But I also get it back from times I don't Hey, i have this deal, i just don't know how the heck to do it. I that's how I learned about wholesaling the first time Right, i had a friend of mine who was so adamant about me buying his house I didn't know the numbers in his area.
Buck and Brew$It's not an area I'm comfortable with. I don't want to be ingrained or happens. But he's like no, just throw me an offer. So I did some kind of quick and I was like, well, if I'm going to do it, i'll make this. So I call the hard money people. Again, this is years later, whatever. It is like crap. Hey, i got to do this house. He's like you don't want to do it. And I was like, no, he goes. I got a guy that wants to borrow some money What I don't have him. Look at it, go in. And I made 35,000 bucks on my first wholesale deal, right Cause he and so and my buddy was happy because I was like Hey, and I offered it to him. I was like, hey, i got another guy that wants to do it, you'll make 35 more. He goes, no pay in shakes, a handshake agreement. It's agreement, you pay me what I want, you still buy the stakes and the beer. I was like, yeah, it's like 35,000.
Ed MathewsHow thick would you like it?
Buck and Brew$You want to go to Ruth Chris? real problem was is we closed it like noon and Ruth Chris wasn't open at the time. So, I got. We have a small steakhouse around here called brands. Like the highest stake is maybe 20 bucks Right, so beers are two bucks Right. That's where we ended up going, so it's awesome.
Buck and Brew$Yeah, you know it's like cubes cubes for your other sir lines. But so because I just I, i ask everything. I'm not afraid to admit that I don't know a dang thing. When I tell you I'm stupid, i really mean it, but I'm smart enough to be willing to learn, absolutely.
Ed MathewsThat's the biggest key with me And I tell everybody I'm like, i'm a cheap date And you know, if you meet me for coffee I'll even buy the coffee Right. I'll spend 20, 20, 30 minutes with you. I'll tell you everything you want to. I'll tell you everything I know about. You know flipping, wholesaling, deal flow, capital, raise multifamily syndication, pick a topic and happy to do it. You know it's funny, i used to. So I used to run the local RIA here and I made that offer in front of like 200 people one night and I had seven people take me up on it over the course of the next month.
Buck and Brew$That's really good Seven, but seven is a lot more than I thought. I really held up too, because I really thought two people.
Ed MathewsBut it's shocking that I wasn't, you know, super busy that whole month, right.
Buck and Brew$Right, that's like that's what blows my mind. I mean, i have people that hit me up on it constantly, you know, and here's what just happened to me. This is, we're getting into a long-winded story, so good. So we're in a RIA group, somehow. this guy finds us right And he has a house for sale in Grand Rapids and he's like hey, i got a house and we go through. There's probably 80 of us there And I know that most everybody just talks out their ass. They don't actually do things. So microphone comes to me. He had just got on telling everybody hey, i have a house for sale in Grand Rapids. I want seventy thousand bucks, now the minimum. The median price in Grand Rapids currently is like one eighty, one, seventy, i don't know. And I'm like well, how bad can this place be? It's currently rented, so people like it's livable. And so you know, i get the microphone.
Buck and Brew$I was like nobody talked to him. I'm going to end up buying this thing, you know, pulling this whole big dog string. So a few of us go up to him. There's me another real player. So I go on the first one to go meet the guy at the house. I give him a small offer.
Buck and Brew$My buddy goes, apparently a week later, puts an offer in and it's the same offer as mine. He called me and he goes, hey, would you offer? And I was like, yeah, offer you know sixty five. He goes me too. He goes I might go up to seventy. I was like, yeah, whatever he comes back with to tell me I'll probably give it to him, right, i'm going to make money on this dang thing, it's a good deal, right. And he just wouldn't sell, wouldn't sell, and I've always been a person to fix problems, So. But he kept going up to this girl that was there, right, and she's a friend of mine, a wholesaler, but actually she's flipping now. She's gotten big in her business, she's doing well, and he just kept going up to her, kept going up to her two months in a row. Brooke, when are you going to come?
She's like Nick wants it, nick's already up, and so, finally, I look at her and I was like, hey, i'll give you a thousand bucks just to be the woman because he doesn't want to deal with guys. Apparently, just go be the one, go put it under contract for me for sixty And I'll give you a thousand bucks. And she goes OK, literally, meets him, puts it under contract for sixty, i pay her the thousand. I just closed last week. So right, i saved four grand by fixing what he. You know whether he doesn't like guys, because we're we're dudes Like he just only wanted to work.
Buck and Brew$I don't care, right It doesn't matter It matters in the end of the day, as I get the deal Right. However, i gave him exactly what he wanted. He stood up and said hey, i want 60, 70 K for this. Look, 60 is where I think it's good. Yeah, and I gave him. It's not like I ripped him off and didn't do anything. It just literally had to get the right person to get him to say yes.
Ed MathewsRight, Right on. That's awesome And it's amazing. And you know, problem solving is is such a big part of what we all do, Right? Yeah, Is you know you solve the problem? You know I'm always looking for stressed out property owners. Yeah, Because you know there's you got to think about, like you know, a golf bag, right, I mean, how many, how many solutions do you have in your, in your bag to be able to whip out and say, hey, you know, yes, I can buy you out of. You know, your tax problem. Yes, I can give you 20 grand down so that you can, you know, do whatever you need to do with that money and take care of it. And yes, I'll, I'll pay you. You know, I'll pay off your mortgage over the course of time. You know, if you're paying 500 bucks a month, I'll pay a 750 a month And we'll just, you know, I'll flip it And when we sell it, then you know, you get to pay everything off. I mean, there's any number of ways to creatively solve a problem.
Buck and Brew$Yeah, Help somebody out, Let's say but the point of that, real quick, sorry, was the fact that there's 80 people in this room. this guy presented to it. Yeah, two, right, Two of us were actually serious enough to actually go do it, And it's amazing you know, this guy thought he had everything, because he's like oh, everybody's like, everybody's talking about it, and it was like that's the problem Everybody talks, right, right, and I show action.
Ed MathewsYou know it's, it's interesting. You see, all these like there's a, there's a metric in coaching and training and all that, that's it's mind boggling And that is that if you get 100 people to buy a coaching program, 95 of them will never open the videos Never. Crazy. You know you're spending however much you know 40, 50, 200, a couple thousand, several thousand dollars. No, never open it.
Buck and Brew$Open it but we, we have a huge our rental property owners association event here in February every year, yep, and we have these people that come through and they sell their, their product and stuff like that. Yeah, well, for some reason it's kind of changed this year where everybody's like, oh, money back guarantee, money back guarantee, you know, and I'll give you 100. So these people, they were there and they called out all her name out. Her name's Robin Thompson, right, oh, i know Robin. Yeah, yeah, fantastic. So she's where I got the idea. Rehab She was. so she doesn't do rehabs anymore Now it's just short term rental.
Buck and Brew$Short term rental, yeah. But so she's where I got the idea to make my whole list of exactly what product number I use. So I was like, right, she gives great advice Me too. But in front of everybody, right, these people walk up and they go hey, we haven't made a dime off of your program, and she and we'd like our refund. And she goes well, did you come to my house in Florida and actually go through the course? and they're like, no, and she goes well, you have to do that. And if you could look me in the eyes after that and say you didn't get any knowledge out of it, then I'll give you your money back. And I was like you didn't state that. You literally just stated 100% guarantee If we don't make any money right Like I don't know, but now knowing 95% won't actually. So they probably didn't even open it. They didn't do anything with it, probably.
Ed MathewsBut, yeah, they get caught up in the emotion. They buy the, they buy the product, and then they, you know, next morning they wake up, they have their cup of coffee and they're like, yeah, the thrill is gone. I don't even want this, right? You know what do you mean? I got to spend 30 hours listening to videos to become a millionaire, cause it's hard work, right.
Buck and Brew$So one of our big wins. Before bucks and brews started, we Nick wanted to do real estate episodes. So we're like Hey, we'll go through how to buy a house. And friends of mine, tj and Danny wanted to learn how to buy a house, so they hopped on the zoom. And Nick goes Hey, grab your pens and paper, i'm going to give you a whole lot of knowledge. Right now You're going to buy a house. And I mean he would message me and go, this will never happen. They're not going to do anything I tell them to do, but I'm going to give them such great knowledge.
Buck and Brew$So TJ's like well, i mean we just re-signed our lease last month. So I mean we're stuck here for 11 months. And Nick goes nah, i get you out of that. Well, what do you mean? He goes yeah, we'll just write it into the deal That the seller has to pay your exit fee for whatever rental you're in. And he's like you can do that. He goes you know anything you want, they don't have to agree to it. So literally these people took everything we said in that episode It was probably two hours long And in six weeks bought a house and got out of their lease. And he was so happy because still brings goosebumps, he told me.
Buck and Brew$he told me that night, even after we got off the episode he's like they're never going to do anything, because I tell people things and they just don't do shit. We were getting text messages the next morning with houses What do you think of this house? What do you think of that house? Nick and I are like holy shit, they're actually doing things. Wow.
Buck and Brew$Yeah, and it literally was right, because everything on the podcast was like yeah, but I have this. Yeah, but I have that, and yeah but this. And I was like no, yeah, but right, like you want it. I have two really big philosophies. I live in my life right, like, if you want it, bad enough, you're going to do what it takes to get there. And also, if you don't like something, do something about it. Right, plain and simple. If you don't like what you have in life, do something about it. And so I live there's. you know if you're bitching about your job and how much it sucks, right. If you don't like it, go, do something about it, because nobody else is going to put those resumes out there, nobody else is going to do anything. And so I'm really like, looking back at that episode and even thinking about it, like the tips that I gave so much were just huge to me, like with thousands, millions of dollars, because they're like well, they live in, so again, they're outside of Grand Rapids, so they actually live in a real development area, so they can get an RD loan, and things weren't selling as much. And I was like, yeah, go, you're going to get cheaper down payment because they're like, oh, we don't have this much to put down.
Buck and Brew$And I was like you're in RD loan, like this is go, you know this is the area you're looking in, go and everything, like they. It's like they re-listened to it and took step by step and like did this, that? that bam. And he just all added. And I was like they're like, yeah, but we're not going to have his money to fix it up. And I was like get a carbon allowance, like I don't care, like if it's listed at 60, go pay him 70, ask him for 10K back. Okay, right, like they're like you can do that. And I was like, hell, yes, you can. And then some, right, like you're going to get everything you want and not have to pay for it, except for over a 30-year loan. All you're doing is asking for 30-year financing on it versus doing it today.
Ed MathewsThat's it. Yeah, it's amazing what you can get when you ask for it. Yep.
And and do I one of my favorite episodes? I know it is.
Buck and Brew$They did everything you said to do, yeah, and they went and bought a house.
Buck and Brew$And they're happy and shit about it. They are.
Buck and Brew$They're so happy they have their house.
Ed MathewsThat's wonderful. That's one of those warm your soul kind of stuff. Yeah Right.
Buck and Brew$It's what made us definitely keep going with this, like because we knew it was working, yeah, so let's, let's talk about keep going, right.
Ed MathewsSo you have bucks and brews, right. And now I know that you're expanding this to to for kids And there's an international version coming out. So why don't you tell us all about that stuff?
Buck and Brew$So we have for the kids, we have pops and pennies, which we push that more on YouTube, but we also do put it out as a podcast. We try to keep those to 10 minutes in length because we're trying to keep, you know, the attention span of of younger 12 year olds.
Ed MathewsRight, yeah, yeah.
Buck and Brew$And we we have several dedicated listeners to that. They'll watch with their parents and they'll send us question or have their parents send us questions and ideas for shows. Like one of my coworkers, her son watches and he wanted to know how stores buy merchandise without having to hand money over for all of that merchandise. So we took that on and did that episode Investing.
Buck and Brew$We teach a three jar system. Yeah, my seven year old absolutely hates. She thinks that having to save 50% of her money is, and I quote, this is so stupid. I do it because you want me to, you're welcome, right? Exactly, that's my response every time. I'm like, yep, you're welcome, and she's like, no, i'm not welcome. This is dumb. What what? the stupid toy that I'll never play with. And I'm like, yeah, like you'll thank me later, you'll hate me right now And I'm fine with that, but years from now, you're going to go dead. You might actually be kind of smart.
Ed MathewsYeah, i mean when you're living in a condo. When you're 21 and you're living in a condo and all your friends are renting or sleeping on your couch, you know you're going to. They'll turn back and go. Thank God, i did that, Yeah.
Buck and Brew$Let's say but so, yeah, we teach the three jar system, We're working on creating our own to be able to sell or give out type of a thing. You know we just we got to, We were doing so much, I mean on a constant.
Buck and Brew$We do a lot of things, especially merch wise, because I mean, we love our logo, so we want to plaster that everywhere.
Buck and Brew$It's awesome My daughter goes to school with the pops and pennies cup. And then we internationally traveled on a cruise and all that, which, of course, i didn't bring my Bucks and Bree shirt, because that's who I am as a person or any of your merch anything in life, but we created a Paisels and Surveys, yes. So every time we go out of the country, we bring the podcasting stuff to record a fun episode with people that we meet, do anything like that, and and then in a year or two, I'm taking a trip to the UK with my best friend and he actually joins us quite a bit on the show to either talk or listen, and we're going to do Pounds and Porters.
Buck and Brew$Yeah, so fantastic. You know, one of the big things with dividend stack was funny because David started investing in dividend stocks and that's one thing that hit Mike, our buddy Benson, and he's like all of a sudden, you see it kind of click and he's like, yeah, and so he goes and he goes door dashes.
Buck and Brew$Yeah, he was doing door dash to make extra money to invest in dividends.
Buck and Brew$Just to just specifically for dividend stock. We're like man, even the people that are closest to us, like even when David because David and I invest so different, which is hilarious, because it's funny, because, like his long term investments are way over here and minor Real estate tangible asset like but we both have, i mean, a core right. We also have four Roth IRAs or 401ks or whatever it could be, and then just mixes in between, but like we are really opposites, david, he's about pennies, right, just very much.
Buck and Brew$And I see a penny, i'm picking it up next kicking it down the road.
Buck and Brew$Yeah, usually like I still throw my beer cans away, right, like David gives me so much crap because even here I just go throw them in the trash, it's a nickel.
Ed MathewsIt's a dime, i'm here. Yeah, i'm in Michigan. That's a nickel here, connecticut.
Buck and Brew$But right, so I just to me it's, it's, the idea is just not worth it. It's not, i'm not at that point in my life And I just look for the big. You know, my focus is on the big deal, on the big game. So you know. But we are really excited about expanding our stuff, getting into, you know, more logos, because we just do, we love our logos.
Ed MathewsSo yeah, so congratulations on all your success. If folks want to hear about you and get to know you guys, what's the best way to do that?
Buck and Brew$So you can find us on bucksandbrooscom. You can find us on Facebook Twitter.
Buck and Brew$Stitcher Apple. Yeah, we're on all the podcast services.
Buck and Brew$The biggest deal, if you're looking to us up, is bucks and brews. The S's are with dollar signs. Yep, nick says that to everybody, because sometimes you can't find us if you don't have those dollar signs.
Buck and Brew$Yep, and you know, if you, if you want to reach out to us personally, go on to bucks or go on to Facebook, really you'll message and say, hey, i want to pick Nick or David's brain, depending on where you want your investment stuff to be And then we'll probably end up private messaging you from our own personal stuff because we're not huge yet and we don't pay people to do all of our stuff. We're still doing the dirty work.
Buck and Brew$Well, you know, and we do, we do guest centric episodes quite a bit. We've had people come on to talk about their debt and we give them ideas on how to get out of it and then we'll do an update with them to see how their debt journey is going. We've had young people on and we give them an idea of you know this is what you want to do, for you know you're the next three, four, five years of work in investments. So I mean we it can be a big thing, it can be a small thing, we'll take on anything because we like helping people.
Ed MathewsYeah, well, and in a lot of cases it's a lot of little things, right? Yeah, that add up. Compounding is a real thing, so. So we are wrapping up it for your audience. If you want to get a hold of me, i'm at the real estate underground and, again, i'm on Apple and Spotify and Stitcher and Google Play and anywhere else you can get your podcast. You can also find me on pretty much any social media platform at Clark Clark S T capital and we're at Clark S T dot com, clark Street dot com, on the website, and if you want to reach me directly, hit me up on any of those, and I'm Ed at Clark S T dot com. You send me an email and I'll answer you.
Buck and Brew$Excellent. Yeah, i have a feeling we're going to do this again.
Ed MathewsYeah, it's like I want to dive in, already done it twice.
Buck and Brew$So, absolutely. I want to dive into your whole business. I love where you're headed, so yeah.
Ed MathewsWell, i'd love that. That would be great. Tell me when I'll be there, great.
Buck and Brew$Sounds great, we'll send you some dates?
Ed MathewsYeah, absolutely, and I'll make sure I don't have a softball game afterwards, so I'll drink with you.
Buck and Brew$So same as always, to everybody listening like subscribe, share, tell your friends, tell your family. We really appreciate you guys listening to us and everything that we can do for you.
Buck and Brew$Yeah, if you're a Bucks and Brews listener, please go also listen to real estate underground, and vice versa, because you know we're doing good stuff, both of us, and yeah everybody hear it Absolutely.
Ed MathewsAnd to my real estate underground or same thing, you know these guys, you know you're going to get the real deal. They've got you know a tremendous catalog of shows and you know they bring real world experience and from a lot of different investing classes. So if you, you know, if you're interested in the stock market or you're interested in real estate or you're interested in something else, pretty good chance as an episode on Bucks and Brews to talk about that. So, guys, thank you very much. It's a real pleasure.
Buck and Brew$Thank you for having us, ed.
Ed MathewsThank you, i appreciate it. This been the real estate underground podcast, a Clark Street Capital presentation. Thanks for joining us. If you're enjoying the show, please remember to subscribe and share it with your friends. If you'd like to learn more about Clark Street Capital and our upcoming projects, please join our investor club at clarkstcom. slash. join until next time. Happy investing.