JF1358: Relationship Based Lending For Long Term Partners with Ramon Gonzalez

Listen to the Episode Below (23:20)
Join + receive...
Best Real Estate Investing Crash Course Ever!

Ramon got his start in real estate when he left the corporate world to be an entrepreneur. A large part of his success he can attribute to being able to identify what he is good at and sticking to where he is wanted. After multifamily investing in Miami didn’t work for him, Ramon tried the fix and flip model. Ultimately neither strategy was fulfilling, now he lends money to active investors, and loves it. Hear what he looks for before lending to an investor and why being able to put your ego aside and focus on your strengths is key to being a successful entrepreneur. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!

 

Best Ever Tweet:

 

Ramon Gonzalez Real Estate Background:

  • Summitt Home Buyers, Chief Investment Officer
  • Places capital with amazing operators that share the same core values
  • 100% relationship based, looking to form and nurture long term relationships with partners
  • Based in Miami, FL
  • Say hi to him at www.miamimillionairemastermind.com  
  • Best Ever Book: Unique Ability by Dan Sullivan

Join us and our online investor community: BestEverCommunity.com


Made Possible Because of Our Best Ever Sponsor:

List and manage your property all from one platform with Rentler. Once listed you can: accept applications, screen tenants, accept payments and receive maintenance tickets all in one place – and all free for landlords. Go to tryrentler.com/bestever to get started today!


Read Full Transcript

Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I'm Joe Fairless, and this is the world's longest-running daily real estate investing podcast. We only talk about the best advice ever, we don't get into any of that fluffy stuff. With us today, Ramon Gonzalez. How are you doing, Ramon?
Ramon Gonzalez: Awesome, excited to be here.
Joe Fairless: Alright, we're excited to have you on the show. A little bit about Ramon - he is the chief investment officer at Summitt Home Buyers. He is really 100% relationship-based and looking to continue to form and nurture long-term relationships with partners. The primary focus of his company now is lending their own capital that they made through fix and flips and multifamily transactions to other operators that share the same core values. Based in Miami, Florida... With that being said, Ramon, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?
Ramon Gonzalez: Sure. I have a corporate background, General Electric... Once I graduated, I worked in Connecticut for a little bit; I left the corporate environment, tried doing multifamily with a partner in Connecticut, then moved back down to Miami. I wasn't able to do the multifamily model [unintelligible 00:02:04.00] didn't really work for that, and thank god they didn't.
We did a lot of wholesale and fix and flip in that timeframe, and then we got out of most of the assets in that timeframe. Then throughout that whole cycle we just fix and flipped and made some money like that, and then kind of [unintelligible 00:02:18.28] cycle again; we started picking up assets, we held them, as well as fix and flip throughout the cycle, and we just kind of exited the majority of our assets last year and this year.
Now we're kind of just in the lending business. We've been doing lending, JV, transactional funding with great operators. We find that that's been our unique ability, our niche. We were good operators, and as I started to mastermind and connect with folks where that really is their passion and unique ability, they're just better. I focus on what I'm great at - connecting people, adding value, running masterminds, helping these guys really take their businesses to the next level. I'm a lot more happy, and I have a lot more time, and I kind of go where I'm celebrated, not where I'm tolerated.
Joe Fairless: I've never heard of it put that way... Did you create that?
Ramon Gonzalez: No, I actually heard that from a part of my mastermind, but I love it; it's so simple, but it's really true. It's really this concept from Dan Sullivan, from the Strategic Coach - he talks about finding your unique ability. I think a lot of entrepreneurs or investors - I think there's a big difference here: they don't know what they want, they don't know what they're great at, they're not really self-aware, and then they kind of resign to a life of doing a lot of different things, but not really knowing what you're passionate about, what you naturally do easily.
[unintelligible 00:03:29.08] from listening to your podcasts, you have a partner on the multifamily business, because you don't wanna be day-to-day on the operations, right?
Joe Fairless: Well, he's better at it than I am, that's what it boils down to. He has better experience than I do, and as you said, I recognize that I am a good operator, but I have a team member and I'd put him up against anyone else... So he takes the charge on that.
Ramon Gonzalez: And it takes putting your ego aside on that, you know? A lot of guys - when you let that ego run the show, it's no good; it's "What's best for the team?", and if there's somebody better that can do that, then let's split capital up with them and figure out how we can do more together.
Joe Fairless: So with your business now, lending your own capital - you've evolved that, and I want to focus the majority of our time on that, but I would like to back-track a little bit just to learn a little bit more about your background. You said you were doing multifamily in the North-East, when you were in your corporate background, GE; you left that and you came to Miami, that model wasn't working, so you did fix and flipping, and it sounded like you were doing fix and flipping during 2008. Is that correct?
Ramon Gonzalez: Correct. 2008, 2009, maybe even 2010. In 2010-2011 we saw the market start to correct, some of the metrics I was tracking in terms of economic cycles... My degree is in economics, and I've always had a passion for markets, market cycles, and I could just tell the market was turning; we started buying and holding at that point in the cycle. It's not that we're that intelligent; we definitely forced some appreciation, but the market gave us a lot of that appreciation, and having been through my second cycle now, the market has done a lot of the heavy lifting for us, and I'm grateful for it, but at the same time I'm not taking credit for it.
I think there's a lot of people out there saying "Hey, I'm a genius", and the reality is the market -- rising tides floats all boats, and I'm not taking credit for that. I know that the market did that work. I did some of it, but the market did the heavy lifting, for sure. So we took some profits, and then from those profits we're now able to scale up the loan business, and through our network as well.
Joe Fairless: You said you were looking at the metrics and you were tracking the metrics; you've got a degree in economics, and you were focused on markets in different market cycles. For a Best Ever listener who is now in the fix and flip -- or just an active real estate investor, and they want to look at the market cycle through the same lens that you were looking through, what should we be looking at?
Ramon Gonzalez: One of the key metrics I look at, and probably if I had to boil it down to one key metric, it's probably the supply of inventory. In a normal market is 5,5 months, in a stable market. When the market corrected, that number went way up. What that number means is how long would it take if no new inventory was brought to the market to sell all the existing inventory.
When you have a number like, let's say 15 or 16, properties are sitting there, no one's really buying... So what you can do is come in there and buy the best deals; a lot of inventory is on the market. As you see that number come down, you see foreclosures start to come down, a lot of buyers come back on the market - right when that starts to happen, that's when you wanna start picking up these properties.
I call that "seasons." You wanna be buying in the spring, because summer is gonna come and then fall is gonna come, and then eventually winter always comes... And again, winter is not a bad part; like, "No, people freeze in winter." Yeah, but they also go skiing, so you can still make a lot of money in the winter, especially if you're in a coastal market; you've just gotta adjust your strategy.
Joe Fairless: The month's supply of inventory - how can I find that?
Ramon Gonzalez: All the realtor boards report that. Your local realtor board reports that, all the properties that are traded. When they report new listings, new inventory, you can also look at days on market and how long the current property was sitting on the market; you can track all the data there. The big one is month's supply. I like to be in a market where if we're fixing, flipping when there is very little inventory, the little inventory that comes on the market moves very quickly.
Right now, Fort Lauderdale, which is the market above Miami, for single-family houses it has about four month's supply, whereas Miami has a little closer to six. So if I had a choice between the two counties, I'd rather be in the one where they're just moving faster...
And then the other thing you wanna look at is at what price points things are moving. Sometimes under 300k-400k in these markets no one's building. So you wanna go where there's a lot of demand and very little supply. [unintelligible 00:07:52.01] the moment you get over 400k-500k, affordability becomes an issue, things sit on the market longer, there's softening in the pricing, days on market goes up... So you can be strategic in terms of -- this is a business, and when you take on investor capital, we don't take that lightly at all. We've never had to file bankruptcy and never not pay someone on time. And it's not that we're so great, it's that we've been able to just really be conservative in our numbers; do what you say you're gonna do, and be strategic.
Joe Fairless: You were a multifamily investor initially, and then you went fix and flip, and...
Ramon Gonzalez: And then we started picking up both singles and multis, and doing both, and fix and flips that generate the income to buy and hold.
Joe Fairless: Okay, perfect. So since you have a background in both single-families and multifamilies, does the month's supply of inventory metric apply to multifamily purchases the same way it applies to single-family purchases?
Ramon Gonzalez: Not as much. Multifamily is more job growth... It's a different metric. There's a website called IRR.com. They provide a lot of great data on multifamily, commercial, where things are in the economic cycle. Even what they call things are different - they call it recovery, expansionary [unintelligible 00:09:06.24] What they track is different on the multifamily and commercial side. IRR tracks all those markets, and it's what we then use.
In the multifamily space I like to buy for the recovery, and up to late expansion. I think that's where a lot of the rent increases and everything else, a lot of the value-add is in that space from the market, and then you can refi or do what you want. If you wanna hold it through the down cycle, you definitely can, as long as the properties cash-flow; it's one of the great things about multifamily. And yet, if your expectation is to have a lot of high appreciation from the market appreciation during a down cycle, I think that [unintelligible 00:09:40.25] during that down cycle, so I think a lot of people are gonna get squeezed if they're buying at high basis right now, and there's no value-add.
Joe Fairless: So now let's talk about your current business. You're lending capital to operators that share the same core values. I'm repeating what I have in my notes here for your bio... So I'm assuming those are your words, is that right?
Ramon Gonzalez: Yup.
Joe Fairless: Okay, cool. So what are the same core values that you're looking for?
Ramon Gonzalez: At the high-level are that they're loyal (loyalty is important to us), that they think long-term, that they're relationship-based... So if someone reaches out to me and says "Hey, let's do a deal together" and they're like "Alright, what are your rates and what are your points?", I want them to win, and they also want us to win.
Our loan portfolio right now is gonna be 10 or 15 different borrowers, and we can go deep with a few guys, versus wide with a little bit of guys. Our goal is to help them do more and make more, and ultimately how do we do more together. So they think long-term, they've gotta wanna grow... A lot of folks are okay doing a couple deals here, a couple deals there, but that's not what we want. Most of our guys are doing anywhere from 5 to 10 deals a month, maybe more, depending on the market and depending on what the strategy is... But they can consistently keep a fair amount of capital at play and still keep liquidity high. So high-level that's what we're looking for: integrity, thinking long-term, that they invest in themselves and are always growing...
When stuff happens, Joe, in this business, that they tell me about it, that they're vulnerable and open and say "Hey, you know what? There's an issue here. This is taking longer than what I thought", or whatnot.
As long as we have those core values together... And really, the biggest one is that if something went wrong, they'll do whatever it takes for being resourceful... Take a job at Burger King, whatever it takes to actually pay us back.
Joe Fairless: How do you evaluate for the Burger King example? How do you determine that someone has that characteristic?
Ramon Gonzalez: It's the hardest part, Joe, because they asked JP Morgan, "Do you look at the deal or do you look at the opportunity? What do you look at?" The answer was "Character, character and character." I couldn't agree more. It takes time to know someone's character, because character is tested when things get tough, that's when character is tested.
I'm in a lot of high-level masterminds, I've spent a lot of time with the operators, and you just start to see how they do things, you start to see how they treat their people, you start to see how they treat a waiter. I run the background checks obviously, and I actually like that they have something - a bankruptcy in the past, or they've been through something... I actually prefer that, because I know that they've been through it. My thing is not that you've been through stuff, but what did you do about it, how did you treat your people...?
So I look at the integrity, I look at how they do things... And really, I like to see how open and vulnerable they are with what's going on in their business, because all of us being entrepreneurs, there's challenges we have - hiring people, scaling out the business, emotional challenges... Our holistic being, relationships side. If someone's looking for help and they realize that there's an issue and they're open and vulnerable and coachable, that tells me a lot about somebody.
Joe Fairless: Speaking of challenging stuff - that you and I and everyone else has come across as real estate investors, I'm sure - what's a challenging moment you've had in your business?
Ramon Gonzalez: Oh, wow... I've had all sorts of challenging moments. I think the most challenging thing as an entrepreneur... I differentiate an entrepreneur from an investor. An entrepreneur is someone who wants to build out a business, hire people, create staff, processes and systems, and there's a transactions side of the business. To me, an investor is someone "Hey, you've got capital, you put capital at play." So when we do more of the loan piece, that's more of the investor piece, even though we are actively growing that business... Yet, it is "Hey, we're putting capital at play for a return" - that's more of an investor.
When we were doing a lot of the fix and flip transactions, and in that space - we did some JV deals in that space - the hardest part I think about being a business owner is bringing someone on board, training them, making sure that their core values are aligned with the company's, and then really helping them grow. Some of the worst parts is letting someone go. I care so much about my team and bringing people on staff that if something doesn't work -- you do everything you can; [unintelligible 00:13:30.00] when we hire people and everything else, but sometimes it just doesn't work out. Sometimes you go to three or four people, five people, and it can definitely be frustrating and a little bit discouraging at the same time.
I've had employees come on staff starting at $30,000 become multi-millionaires through our organization. Outside of my daughter and my wife, maybe even the masterminds, it's the single biggest thing that I'm most grateful and proud of, when someone in the organization becomes a multi-millionaire. Sure they did the work, but you were there as a coach to help them, inspire them, influence them... And that's what you can do as a coach. You can't do the work for them, but it sure is gratifying.
Joe Fairless: If you can think about one of those individuals who came into the organization making 30k and then becoming a multimillionaire, what transactions did they do to get them to be a multi-millionaire?
Ramon Gonzalez: They were always very up-front on saying "Hey, whatever you guys are doing, I want to start doing some of this as well. If you can teach me, I'm here to learn, and I'll take less of a salary, but I wanna learn everything you guys are doing", and they were willing to pick up tasks on the weekends, or willing to pick up extra work. So they didn't limit themselves to that role, and we were almost like a partner; whatever was needed from them, they were willing to do.
And then also it's the organization - me as a leader, if I came across a deal, and rather than sell it to the market, and even though we were gonna make a substantial profit, this person in our organization [unintelligible 00:14:50.11] and she said "Look, I'll buy this deal at this number." And again, she saw what was happening with the market, she picked up a few condos, and as the market increased in value, she started refinancing, recapitalizing, and continue to save. And again, deferred gratification, and just followed the footprints we were doing. She followed all our property management systems, how to find properties, how to do direct mail... She figured all those pieces out on her own, and she was very intentional and said "Look, I'm not gonna compete with you. I'll do this [unintelligible 00:15:17.17] I'll do this through the MLS", and I was totally on board.
I knew she was gonna become wealthy by working for us, and I'm so proud of her. She is family. I only had one employee do that. She isn't my family, but she is family, you know what I mean?
Joe Fairless: Yeah, I hear it, and I'm sure she'd say the same thing about you, that's for sure. So basically it was the method of buying condos, them appreciating in value, refinancing out the proceeds and using those proceeds to put into new deals?
Ramon Gonzalez: That's it.
Joe Fairless: Great stuff.
Ramon Gonzalez: Yeah, just being persistent, just continuing to persevere and not bang our head against the wall... And there's people out there like that, you can change their lives. So as an entrepreneur, outside of the profits and everything else - the money is temporary; that's single biggest impact that you could do as an entrepreneur - the lives of the people you touch.
Joe Fairless: Based on your experience as a real estate investor and entrepreneur, what is your best real estate investing advice ever?
Ramon Gonzalez: When you look at a deal or you look at an opportunity, identify if it's an opportunity or distraction based on your unique ability. What is it that you're uniquely great at? What is it that you're here to do? There's 1,000 doors to financial freedom; what is your thing that you have a unique gift at? Follow that course to your financial freedom path. It's gonna be different for you. Don't copy anybody else; listen to them, take advice, but find your unique way, find out what you're great at, and then double and triple down on that. That's gonna be your unique way to financial freedom.
Joe Fairless: Powerful, powerful. I'm gonna repeat what you said, the Best Ever advice, and then I'll recap it later, because it definitely needs to be mentioned again. Identify if it is an opportunity or a distraction based on your unique ability. I always talk about identifying the unique ability that we have and leveraging that, but I never thought about assessing it based on new opportunities and seeing if it's a distraction or if I can leverage what I'm doing. That's great stuff.
Ramon Gonzalez: Awesome, I'm happy to add value to your listeners. I think what you're doing is amazing, and it's definitely needed, man. I think you're creating a huge impact, and I'm really proud of you, man.
Joe Fairless: I appreciate that. We're gonna do a lightning round. Are you ready for the Best Ever Lightning Round?
Ramon Gonzalez: I am, I'm ready!
Joe Fairless: Alright, let's do it. First, a quick word from our Best Ever partners.
Break: [00:17:29.19] to [00:18:09.13]
Joe Fairless: Okay, best ever book you've read?
Ramon Gonzalez: Best ever book I've read... I'm gonna go with A Unique Ability by Dan Sullivan.
Joe Fairless: Oh, man... Okay. I did not know that was an actual book. I will check that out. Best ever deal you've done, that wasn't your first and wasn't your last?
Ramon Gonzalez: Best ever deal I've done was an 18-unit deal we purchased in Miami, Little Havana, upcoming neighborhood. We thought we were buying it high; we came in there, redid the whole thing and sold it, and netted about a million dollar on it.
Joe Fairless: Why did you buy it if you thought you were buying it high?
Ramon Gonzalez: I didn't really know the market and I didn't really know the pocket that it was at, and how good the pocket was. It wasn't until later a Marcus & Millichap broker - him and I are great friends - told me "You don't understand how good of a quality location this is", and what was going on in the area. I thought it was a good deal, but yet the area and everything else, really... I was able to get higher rents, I was able to get better quality people just because the exact corner it was at.
It was still in a hot spot, it was still in a touristy area; I didn't know that, but I was right at the fringe of that. Had I been on the other side of the street - a completely different property. This just goes to say, know the areas, because that building generated an extra couple hundred dollars in rent a month, and it filled up a lot faster just because where I was at, I could justify the rent increase and I could just find the extra value in the improvements, and someone was gonna pay for that, whereas on the other side of the street they wouldn't.
Joe Fairless: What's a mistake you've made on a transaction that we haven't talked about already?
Ramon Gonzalez: A mistake I've made - we purchased an 84-unit building in Baton Rouge; it was in a D area, it was a half property contract, the whole building had like a Section 8 subsidy and we weren't equipped to handle that kind of asset. We didn't have the infrastructure, we didn't have the know-how, and we got our butts handed to us.
Joe Fairless: How much did you lose?
Ramon Gonzalez: I wrote off $364,000 last year.
Joe Fairless: That was last year, so I imagine it was more than that?
Ramon Gonzalez: We wrote off the whole thing. We had bought this in '07, so at the peak of the market (or '06), and just recently I just wrote off the rest of it. Luckily, we had a lot of gains from the other things, so we were able to kind of tax harvest that, but it still sucks.
Joe Fairless: If presented a similar opportunity now, what would you look at differently that you didn't look at before?
Ramon Gonzalez: Just knowing that unique ability, and sticking to that. It wasn't a unique ability; I don't do a lot of Section 8 stuff. I was missing an operator at that Section 8 stuff, that that's all they do. So I have an operator now who I've just found today actually, and they do a lot of turnkey Section 8 stuff, but that is all they do. They don't do anything but that. They do C-, D stuff. They have a real turnkey model, they have scale, and then I'll do that through them, but that wasn't a unique ability for us. Really staying in a lane...
Joe Fairless: What's the best ever way you like to give back?
Ramon Gonzalez: The best thing I'm gonna do when I give back is my mastermind. I run masterminds, I have high-level investors coming in, different spaces of real estate, whether it's mobile home parks, self-storage, whatever it is, or fix and flip business entrepreneurs... And I look to just really connect people together, connect amazing together that share core values, and "How do we do more together?" That's the best thing I do to give back - the power of masterminds and getting together with like-minded people and just collaborating.
Joe Fairless: How can the Best Ever listeners get in touch with you?
Ramon Gonzalez: You can go to miamimillionairemastermind.com, that's my website. You can find out more info there if you're interested in masterminding. I'm on Facebook, I do a weekly Facebook live within real estate and I help people become financially free. [unintelligible 00:21:31.25] is to help a hundred million people become financially free.
Joe Fairless: How many people?
Ramon Gonzalez: A hundred million.
Joe Fairless: That's what I thought I heard you say. Yes, do that! Please do that, I'm kind of speechless; do that, please. That'd be incredible.
Thank you so much, Ramon, for being on the show. It's a sprinkle of real estate and a dash of mindset, and I think that's the approach to take in our business, because mindset is critical to what we do... But we also talk specifics about deals, and lessons learned, and as I mentioned earlier, I'm a huge fan of what you said - identify if something is an opportunity or a distraction based on our unique ability. And it sounds like a good book to read on that is Unique Ability, by Dan Sullivan.
Thank you for talking about your thought process as someone who studied economics. Month's supply of inventory for single-families, and then for multifamilies it's more job growth, and you gave a reference or a resource, IRR.com. Great website. They have a (I believe it's) annual report that's really good.
Ramon Gonzalez: It's amazing.
Joe Fairless: Yeah, it is amazing. Thanks so much for being on the show. I'm really grateful you were on the show. I hope you have a best ever day, and we'll talk to you soon.
Ramon Gonzalez: Thank you, Joe. I appreciate it.

interior designer Steven Gurowitz

JF1283: Sell Faster & For More Money By Hiring An Interior Designer with Steven Gurowitz

Listen to the Episode Below (26:10)
Join + receive...
Best Real Estate Investing Crash Course Ever!

Adding value can happen in many ways. Steven found a niche for himself in the 1980’s and has been designing high end interiors ever since then. Not only will he design a brand new interior, Steven goes above and beyond by furnishing with fine Italian furniture, and many other small details that a lot of companies overlook. Hear why this is valuable for the investors that hire him. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!

 

Best Ever Tweet:

 

Steven Gurowitz Background:

Started his own design firm, Interiors by Steven G in the early 1980s

-He has turned the company into the one of the country’s largest high end interior design companies in Miami

-Has created interior design projects for commercial, residential and hotels

-Has two showrooms in South Florida with more than 80 employees and clients all over the world.

-Say hi to him at http://www.interiorsbysteveng.com/

-Based in Miami, Florida

-Best Ever Book: The Art of the War

 


Made Possible Because of Our Best Ever Sponsors:

Are you looking for a way to increase your overall profits by reducing your loan payments to the bank?

Patch of Land offers a fix-and-flip loan program that ONLY charges interest on the funds that have been disbursed, which can result in thousands of dollars in savings.

Before securing financing for your next fix-and-flip project, Best Ever Listeners you must download your free white paper at patchofland.com/joefairless to find out how Patch of Land’s fix and flip program can positively impact your investment strategy and save you money.


TRANSCRIPTION

Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless. With us today, we’ve got Steven Gurowitz. How are you doing, Steven?

Steven Gurowitz: I’m doing well, Joe. How about yourself?

Joe Fairless: I’m doing well, and nice to have you on the show. You’ve got an interesting background. Steven has started his own design firm, which is Interiors by Steven G., in the early 1980’s. He started out as a real estate investor. He’s based in Miami, Florida.

I’m gonna go ahead and just turn it over to Steven. Steven, do you wanna tell us a little bit about your background and your current focus, just how you got started?

Steven Gurowitz: Got it. Well, Joe, 44 years ago I started working for a very small boutique interior design firm here in South Florida, and I took a love and liking to the industry and I really became very self-educated. As the years went on, I was with the firm and became a junior partner, and then almost ten years into it I said “There’s a better mousetrap, there’s a better way to do this, and I’m too talented a person to sit here.”

35 years ago I left the firm, started Interiors by Steven G. out of the den of my home. All of a sudden, my business started to grow and the next thing I knew, I owned my first showroom that was 10,000 square feet. Developers started to call me to do model apartments, model homes and common areas of buildings, so I saw a great opportunity to integrate the world of design into investing and real estate… So I personally started to invest in pre-construction. But what I did was as I closed on the real estate, I would furnish it above the norm, to bring a wow factor to the real estate, put it back on the market for sale, and let’s say 10%, 15%, 25% of the entire project was up for resale from investors. My units would sell first because of the wow factor, and I sold them at a larger price than anybody was getting.

As that started to transpire, my business started to grow. Today we’re at 100,000 square feet of space, and we do this all over the United States for developers and private owners. Basically, I went out to the broker community. In Florida, as everywhere in the country, when there was a boom there were always tremendous investors from out of the country, from local… And I said to the real estate agents, “I will furnish and decorate your owners’ condominium apartment and give them (or you) one year to sell it and pay me. If it doesn’t sell in one year and one day, I get compensated.” We have done this to the tune of 1,000 units, and at the end of the day, nothing has stayed on the market more than six months.

We just opened up a project called [unintelligible [00:05:01].02] a very high-end, luxury project in Williams Island, Florida where we installed four model apartments. The first model sold furnished in one week. So it started to grow, and as long as the owner owns the real estate free and clear and it’s not mortgaged and I can be protected, I’m in the deal… As long as it needs something that’s more on the high end.

Now, we opened up another showroom four years ago next door to us called Now by Steven G., which became popular-priced design packages, as we call them, that run from $35,000 to $125,000, that we’re doing for investors that are renting and getting a bigger dollar, or flipping and getting a bigger dollar in popular-priced real estate. But the place that this really works the best is what I call the luxury market, which is really two million and up.

The developers, the real estate people are selling them like hot cakes, as I am for myself personally. Every project that I do for a developer, I’m hired years before it’s a reality. So I buy at a favorable price, I wait it out, I give it the deposit, I furnish immediately after I close, it goes on the market within a week, and boom. It has just been a huge part of our business where I had to hire a team of designers to work under me, that only do that. That’s how much work we have from our regular business and what I call the investing in real estate business.

Joe Fairless: So at the core of what we’re talking about is – let me know if I’m summarizing this correctly – you identify an opportunity to enhance the interior of a condo, of an apartment, and by doing that it’s then more appealing and then it moves off the market, and then you’re compensated for adding that value through that process, and you do that as a third-party to help out. And you help out brokers who have a deal that hasn’t been moving, and you also do that with your own investing, with pre-construction deals.

Steven Gurowitz: I’ve gotta tell you the only word for it, Joe, is unbelievable. I have clients that hire us to do their own residential work, and they ask me if they can invest with me in my process. Thank god we’re that free firm, I don’t need anybody’s capital, and the end of the day we all know investing money today is always a touchy thing, whether it be the market (even though the market has soared), real estate especially in Florida.

When the market crashed in ’08, it was January of ’08. By June, prices went right back to where they were and higher. So it’s an amazing marketplace, Florida, because it’s a melting pot of people from all over the world, and everybody’s running especially with their money out of a lot of strange countries, because they’re worried about their future there. People that have lived their entire lives there are coming here and buying three, four, five different investment pieces of real estate, so we have found it to be a huge part of our business. Huge.

Joe Fairless: And doing it in Miami is the perfect market to do it, and clearly with your accent you’re not from Miami, are you? You’re from New York?

Steven Gurowitz: Born and raised in Forest Hill, Queens, [unintelligible [00:08:28].20]

Joe Fairless: I knew it! [laughs] I lived in New York City for ten years and it was pretty clear to me that you’re a New Yorker. Okay, so you are doing it in a market (Miami) that caters to more high-end real estate than, say, Cincinnati, or Dayton, Ohio or something like that. So you’ve got a business model that fits within a market… What is your team doing to these units – just pick maybe any of the examples that you’ve mentioned – to enhance the appeal to a potential buyer?

Steven Gurowitz: Okay, well 90% of that luxury high-end real estate in South Florida, the developers have a very fancy word called “decorator-ready.” That means it’s empty. There’s no floors, the walls have a primer code of paint, and bathroom and kitchens are installed. Other than that, you have to go in and design and furnish the entire unit; you have to put flooring in, window treatments. But what we do that’s very different is we go in and furnish it first-class with Italian furniture, with beautiful Italian porcelain floors. We drop ceilings and do LED lightning, so when people walk in, they’re blown away. They don’t expect it, number one, and when people – especially the lady of the house, which if a family is buying, we all know [unintelligible [00:09:49].11] and if the housewife doesn’t like it, the husband can’t buy it.

So the lady of the house walks in, falls in love, and the best part about it for a buyer is today if you buy a brand new condominium and it’s raw, you have to do the design work, you have to pull the permits, and the downtime between permitting and ordering is 6-8 months. Now if you buy and it’s empty, you’re paying your maintenance, your taxes, your electric bill for 6-8 months and you can’t even stay in the unit. And everybody in the high-end world has lived through a designing of an apartment or a home in their past.

The husbands are not fools, they know what their wives will spend. If they walk in the door and they get a number and it’s finished and the wife likes it, that’s 90% of the battle. The rest of the battle for the husband is not allowing the wife to go over a budget, which is also famous in my industry. So there’s a fixed number, you move in the next day if that’s what you wanna do, and you’re done. So there’s a big savings between the taxes, the maintenance, insurance and electric, and the use of the unit immediately is what we call instant gratification, and it definitely works.

Joe Fairless: When you approach brokers – or when brokers approach you – to help them move a property that hasn’t moved yet, or sell a property that hasn’t sold, to be more specific, you told us earlier that it has to be free and clear so that you’re not having to wait in line in case it never sells. What percentage of leads have a broker representing an owner who owns it free and clear?

Steven Gurowitz: 90%.

Joe Fairless: Welcome to Miami. [laughs]

Steven Gurowitz: Well, you’ve gotta remember, after the crash, Joe — before the crash you were a buyer, you could put 20% down and go for a mortgage, okay? So what happened in the crash – thousands of 20% buyers walked away. “Keep my 20%, I’m not closing the buy.” So who got hurt? The developers took a bloodbath. After that, the developers changed the modus operandi. By the time you close today on a luxury condominium in South Florida at any price, you have put up between 50% and 60% and in some cases more of the money and you’re not walking away. So now guys that might have bought three or four years ago when the market was red hot, now the market’s cooled down a bit – you know, it’s that cycle that South Florida goes through – and a building could close with 160 brand new apartments, nobody’s walking away because they have too much money at risk. Now 40 units can be up for sale the next week in a building with 160 units; there were 40-50 investors, or in some cases they could be half the project.

So now the realtors are looking for an edge as to how to get their client out. So if you had 5-6 million on the table, hard, cold cash, and the realtor said “Listen, I’ve got the best designer in town. His track record for selling empty real estate decorating it is unsurpassed. He’s gonna decorate the unit. We have a year to sell it, or pay whatever comes first”, the clients bite at the chance, because there’s no outlay of money. I outlay all the dollars, no matter how much it is.

I have a deal cooking in a project right now where an owner owns a penthouse and it’s a two and a half million dollar buildout, and I’m just waiting — he has approved, his realtors are ecstatic, I’m just waiting for the lawyers to sort of dot the i’s and cross the t’s… And I know – because I know the project like the back of my hand; I did 53 units for owners of the project – when this is decorated, this will sell for between 18 and 20 million dollars furnished.

Joe Fairless: How do you know what in this case — I mean, you said you have a high level of experience with this property… But for a property that is a one-off, how do you know how much to spend and where to spend it so that you do get the ROI back?

Steven Gurowitz: Okay, so rule of thumb in the high-end design world – 50%-65% of luxury condo buyers spend between 20% and 30% of the cost of the real estate to do the buildout, flooring, TV’s, sounds systems, finished. The average. Then there are people that spend 40%-50% because they just have the dollars, they want it over the top etc. So if I’ve got a five million dollar piece of real estate, it’s 1 to 1,25 million for the complete buildout, which is roughly 20%-25% of the cost of the real estate, and it makes it appetizing for anybody in that price point. And remember, and the richer and the higher the price, Joe, the more the luxury real estate will sell, because they don’t wanna go through the root canal and the downtime of six months, eight months, or whatever it could be. Instant gratification is an amazing word that just continues to fly by.

And keep in mind, in the last 44 years I do about 2-3 a year for myself, as a separate business. And believe me when I tell you, the only time I’m gonna say I had a lull was the first six months of ’08. After that, everything sold; it was just like it never happened, and there was an amazing bounce back. Everybody was jumping out of windows in January, and all of a sudden in South Florida, came May-June, it was like it never happened, and developers started raising prices all over town.

Joe Fairless: With it already being done for the buyer, it’s also a benefit that they can finance it, but do they finance these properties, or do they just pay in cash?

Steven Gurowitz: I’m gonna say 80% of our market here in South Florida is a cash buyer.

Joe Fairless: Okay.

Steven Gurowitz: But I will tell you, Joe, there’s a lot of out of country or off-shore buyers that would like  a mortgage; they can’t get one from a conventional bank because they’re from Venezuela, or Argentina, or Brazil. There’s guys making a zillion dollars here in the hard money lending business, and they’re giving mortgages like [unintelligible [00:16:46].06] at 10%-11%.

Joe Fairless: Based on your experience as an entrepreneur/real estate investor, what is your best advice ever for other real estate investors?

Steven Gurowitz: I believe that the greatest time to buy luxury condominiums – because that is really the biggest part of the real estate world in South Florida – is to only purchase free construction. And I am a believer [unintelligible [00:17:16].12] pre-construction, because every developer wants to get to a certain pre-sale market, they’re flexible on price. And you can sit there and you can – let’s use the word ‘negotiate’ a better number. When you go into a project and you buy when it’s finished, you’re paying top dollar, and if you’re an investor, you’re not getting out and making money. You’ll get out, but the windfall is not gonna be there for an investor, Joe.

Joe Fairless: It’s such a smart business model, one because you’re in a luxury niche, and two, you’re solving problems for real estate brokers, for developers, and then also for the buyers, and you’re making money along the way and really giving them an offer they can’t refuse. Do you think this could be replicated if you lived in Boise, Idaho, or Houston, Texas, or Corpus Christi or somewhere like that?

Steven Gurowitz: I think it could be replicated anywhere in the United States, as long as you have as a designer the knowledge of the value of the real estate that you’re buying, versus the investment to flip. Certainly, Joe, if you’re buying a $250,000 condominium that’s a two-bedroom, you have to be cautious to what you spend on the fix-up, but I believe it’s a business model that could work anywhere. It’s all about the dollar investment and the wow factor.

We did a project in Miami, Joe – a guy builds a condominium building in downtown Miami. no parking. Think about what I just said – no parking. If you have a car, you’ve gotta find a lot to leave your car, or a meter on the streets, or figure that out.

Joe Fairless: That’s a problem for a luxury [unintelligible [00:19:01].04]

Steven Gurowitz: Yeah. And I’m gonna say luxury, but popular-priced. 450k, 550k, 650k. Those were the price points. So he came to me and he said “I want you to do 25 units.” We furnished 25 units for $18,000 a pop. He sold them overnight, because people walked in, even in that price point, and loved the fact that they could close and move right in. So I believe it’s all relevant to — I’ve got a monster project that people are talking to me now in New Orleans… Because our trucks go all over the country. So they came to me with a project, and I said to them, I said “Guys, I think you’re taking the wrong approach at this price point. And they looked at me and I said “Look, I’m doing this 44 years. I think I’m pretty glib. I say you should sell every one of these units furnished, and give the buyer five different looks to choose from, all in the same price point.”

Two days later I get a phone call, “We love your concept, let’s roll.” So again, I’m just waiting for contracts to be signed. Who takes the approach, try to do something different is the way I’ve always focused, not only for my real estate investing, but in my design business, which allows everything to happen. We’re doing between 100-125 residential design projects a year. Huge numbers. My staff is 82 at this point. We’re running six trucks. We just came back from the Hamptons in New York, we just finished a job in Kioa Island… People want the talent of the firm, and that leads to everything else. When you have a happy client, just like if you have a good real estate deal – everybody’s happy, and the broker does a great job. If you’re gonna do more real estate, you’re with that broker a second time, or third time.

We have people here that are doing the fifth, sixth, seventh job in 35 years with us.

Joe Fairless: Well, it sounds like it’s a no-brainer ROI on those deals. We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Steven Gurowitz: I’ll do the best I can, Joe.

Joe Fairless: Alright, deal. First, a quick word from our Best Ever partners.

Break: [[00:21:21].24] to [[00:22:10].05]

Joe Fairless: What’s the best ever book you’ve read?

Steven Gurowitz: The Art of War.

Joe Fairless: Oh yeah, good one.

Steven Gurowitz: By Sun Tzu. I couldn’t read it all at one time, Joe, because it was so complicated, but when I got through it, I actually read it a second and a third time, because I found things in that book that lent itself towards a business model, not only going to war. So I loved the book.

Joe Fairless: Another book I know you’d really like is by Robert Green, The 33 Laws of War. What is a mistake you made on a transaction?

Steven Gurowitz: Believing verbiage out of a developer’s mouth, rather than having it in black and white?

Joe Fairless: What happened?

Steven Gurowitz: 90% of what was promised was not delivered, and it was a big disappointment and I was lucky to get out with my pants, if you know what I’m saying. I closed [unintelligible [00:23:02].08] and all of the lifestyle never really happened, because there was a disclaimer kind of a thing in the contract, and I trusted. That was years ago, and I’ve learned from that if somebody makes a commitment or a promise, they shouldn’t be afraid to put it down in writing, as I do for my clients.

Joe Fairless: Best ever way you like to give back?

Steven Gurowitz: Joe, that is a very touchy subject for me, because without the hoopla, without my name having to be on a building, both personally and corporately, we are very philanthropic here… Whether it be to the [unintelligible [00:23:42].21] Foundation, whether it be to children’s autism… Last week the local newspaper (Miami Herald) put out a wishbook for Christmas; we donated a custom wheelchair for $8,800 for a young boy struggling with his parents. We have done huge hurricane relief, we have run our tractor trailers to [unintelligible [00:24:04].12]  to New Orleans when they were hit; we ran tractor trailers to Baton Rouge, Louisiana, we ran to New York and New Jersey, not once, twice. We teamed up with Channel 10, they went out on the air, we filled up 53-foot tractor trailers, had the Florida Highway Patrol escort us so our trucks didn’t have to stop at weigh stations, so we would get to the North-East in 22 hours. That is what I call karma, to be able to give back when you’re blessed, and we’ve been very blessed and fortunate here in Florida.

Joe Fairless: How can the Best Ever listeners learn more about your company?

Steven Gurowitz: They could feel free to call. I love to talk to people. I’m probably the most reachable designer in the industry. They could call my cell phone at 954-592-3332 or text me, seven days and seven nights. The phone is never off.

Joe Fairless: Well, Steven, thank you for being on the show. It’s a beautiful business model (pun intended) and it’s an approach where you’re dealing with the luxury market and you’re solving problems for real estate brokers, because it helps them sell a property faster for owners who have a property that hasn’t sold, because that helps them get the sale done faster… For developers and then for luxury buyers, because it’s a turnkey operation and they don’t have to worry about hiring contractors after they move in. Then for all the poor luxury buyers, they can finance those costs versus having to pay out of pocket.

Steven Gurowitz: Joe, [unintelligible [00:25:42].04] thanks you. I’m honored to be on this show.

Joe Fairless: Thanks for being on the show, my friend. I hope you have a best ever day, and we’ll talk to you soon.

Steven Gurowitz: You too.

Best Real Estate Investing Advice Ever Show Podcast

JF1037: Beginner Wholesaler Does 80 Deals in his First Year!!!

Listen to the Episode Below (22:56)
Join + receive...
Best Real Estate Investing Crash Course Ever!

Have you made the jump into real estate investing yet?  If not, wholesaling is a great way to get started, even if you have some experience, I’m sure you can still learn from Raul.  At only 23 years old, he is doing more deals than a lot of people twice his age.

Best Ever Tweet:

Raul Bolufe Real Estate Background: ‎
-President at Capital Rise Investments LLC
-Have done over 200 deals since beginning wholesaling in 2014
-By age 23 he has wholesale over $15M and made $355K off of the MLS
-Now has a team of 7 people and 3 agents working with the company and growing
-Based in Miami, Florida
-Say hi to him at capitalriseinvestments.com
-Best Ever Book: 10x Rule by Grant Cardone

Made Possible Because of Our Best Ever Sponsors:
Are you an investor who is tired of self-managing? Save time, increase productivity, lower your stress and LET THE LANDLORD HELPER DO THE WORK FOR YOU!

Schedule Your FREE TRIAL SESSION with Linda at Secure Pay One THE Landlord Helper today.
Go to mylandlordhelper.com/joe to schedule your free session.

Mentioned in this episode:

CallRail: https://www.callrail.com/

 

Raul Bolufe wholesaling advice

 

Joe Fairless: Best Ever listeners, welcome to the best real estate investing advice ever show. I’m Joe Fairless and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any fluff. With us today, Raul Balufe. How are you doing, Raul?

Raul Balufe: What’s up, man? Thanks for having me, Joe.

Joe Fairless: Nice to have you on the show, my friend. A little bit more about Raul – he is the president at Capital Rise Investments. He has done over 200 deals since the beginning wholesaling in 2014. By the age of 23 he has flipped over 15 million dollars of property and made 365k off of the MLS – we will get into that. He is based in sunny Miami, Florida. With that being said, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Raul Balufe: I started investing a couple years ago, about three years back. It was a scary transition, because especially in this market it’s really competitive, but I figured “Hey, if other people can do it, I think I can do it, too.” I was actually selling cars at my dad’s dealership, and then I saved enough money and I bought my first rental property and I figured “Hey, I could do this again.” So I started listening to podcasts, reading books, and I got into it.

I got a mentor down here, and I started with the MLS, learning how to send offers, learning how to find buyers, and that’s pretty much how I got my first deal. Now I’m just running with it… We still do MLS, but now we’re doing a lot of mail, we’re doing some bandit signs, we’re doing some internet marketing, websites, and we’ve kind of grown to a team of about eight men, and doing some deals.

Joe Fairless: You’ve got an eight-men team… Walk us through who does what.

Raul Balufe: I’ve got an assistant secretary – she pretty much answers the day-to-day calls and does the checks and pretty much the organization. I have an acquisitions manager for MLS, then I have a sales manager that pretty much does all the sales, I have two acquisitions members, I have one sales guy, and then I have an office manager and two VAs. I don’t know if I lost you there, but…

Joe Fairless: No, you didn’t… [laughs] I’ve been taking notes. Who did you hire first?

Raul Balufe: My first hire was actually one of my first VAs.

Joe Fairless: And how did you find your VA?

Raul Balufe: Online, through Upwork.com. I think before it was oDesk, or something.

Joe Fairless: Yeah… What did you have the VA do?

Raul Balufe: I had the VA send offers for me. I kind of showed him how to fill up the contracts using freedom soft, and I had the VA tell him what [unintelligible [00:04:54].02] and then I would send him the information that would do it.

Joe Fairless: What type of training process did you do at the VA?

Raul Balufe: I actually got some of the training process from another podcaster, Joe McCall… He has some training thing for that, of what to have VAs do. I used the backbone of that, and then I kind of just implemented my own little strategy with them. But usually through e-mail or through YouTube video – I’ll make a little video of how to do it, and they would do it.

Joe Fairless: And how much do you pay them an hour?

Raul Balufe: One VA – I have him at $3.33 and the other one at $4.50.

Joe Fairless: For someone who has a wholesaling business and wants to make that first VA hire, what would you recommend to them? Either a lesson you’ve learned, or ways to get out of the gate strong.

Raul Balufe: What I would recommend is make sure that you yourself know how to do the task very well first, before you can get someone to do it… Because since it’s not in person, you can’t really show them, so it might take a lot of explaining and videos and training to really get them to do it. So make sure you really know how to do it perfectly before you get someone to do it.

Joe Fairless: So before we try and automate our process, we actually have to know the process – is that what you’re saying?

Raul Balufe: Yeah, man… It makes it a lot easier. It’s just so much easier to be able to train somebody on something that you know how to do in and out, so they can sense that you know how to do it.

Joe Fairless: 15 million dollars worth of properties that you’ve wholesaled, right? Not fix and flipped, but wholesaled?

Raul Balufe: Wholesaled, correct.

Joe Fairless: Okay. And how old are you now?

Raul Balufe: 24.

Joe Fairless: And when did you get started? In 2014?

Raul Balufe: Yeah, correct.

Joe Fairless: So 2014, this is 2017 – so in 2016 you were 23 and in 2014 you were 21. So you started when you were 21 years old, and in two years you had wholesaled over 15 million dollars worth of property, right?

Raul Balufe: Yeah… I’m right around 26 million now.

Joe Fairless: What was the first property you wholesaled?

Raul Balufe: The first one I did was actually — I was doing a technique that I learned from Joe McCall, actually… Pretty much texting landlords on GoSection8.com, asking them if they wanted to sell their house. I got a hold of a property manager, and the property manager introduced me to the landlord. That’s pretty much how I got the first deal. I said, “Hey, are you looking to sell?” He said “Oh, I’m not, but my landlord is. I manage his properties.” He put me in contact with him and he gave me a lot of information about his properties; I made him an offer, and I actually got two under contract. That’s how I got my first deal.

Joe Fairless: Where are these properties located?

Raul Balufe: South Florida.

Joe Fairless: Can you give us the numbers on that first one?

Raul Balufe: I was getting it for 62k and I assigned it for 68k. So I made about 6k there.

Joe Fairless: And you mentioned GoSection8.com – obviously, it’s a website. I haven’t heard of that one.

Raul Balufe: That’s pretty much a website where landlords and potential tenants can go and view properties that are Section 8-ready… Pretty much properties that the landlords only want to rent to Section 8 tenants.

So the tenants can create an account as if they’re the tenant, and they’re able to view these properties. The landlords create an account like if they’re landlords, and they can list their properties there. And it’s free.

Joe Fairless: Okay. And you went online and you texted the number, you got a hold of a property manager who then introduced you to their client, the landlord, and then you wholesaled his property.

Raul Balufe: Correct.

Joe Fairless: $62,000, and you signed it for $68,000… You gotta do a lot of those to make up 15 million in two years. Help fill in some of the gaps there.

Raul Balufe: When I say 15 million it’s worth of properties, not 15 million profit.

Joe Fairless: No, I get it. I was with you on that. [laughs]

Raul Balufe: Yeah, okay… I’m like “Damn [unintelligible [00:08:55].22] I’d be next to Donald Trump, or something.” So basically our average property now is about 120k. Basically, we do about 80 deals a year.

Joe Fairless: Okay, I’m with you.

Raul Balufe: Do you kind of see how I got there? So the 60k one is one on the lower end.

Joe Fairless: That was your first property.

Raul Balufe: Yeah, it was my first one. So now our average wholesale is from 140k, 160k, something like that.

Joe Fairless: What are you doing with the profits? Are you investing them into long-term holds, or are you just putting them all back in the business, or are you buying cars, or what?

Raul Balufe: No, not cars, man… [laughter] Maybe a little bit. So a big portion of it in the beginning (in my first two years) was going into buying rental properties. I accumulated a little portfolio of single-family homes – I’ve got about ten of them now. After I did that, I started putting more of the profits back into the business: hiring new people, sending more marketing… That’s when I got more into mail and online advertising, and hiring more staff to help me grow.

So to answer your question – yes, in the beginning more towards buying properties for rental income, and then now the majority going back into the business.

Joe Fairless: What’s been the best investment that you’ve made back into the business and what’s been the worst investment that you made back into the business?

Raul Balufe: That’s an awesome question. [laughs] I like that question. Okay, so the best investment made back into the business was reinvesting in mail marketing. I’m sure you hear – and probably everybody listening to this probably hears a lot of podcasts or reads books, and they hear that mail goes up, it goes down, but if you’re consistent, mail works. At the end of the day it’s just the way I’ve seen it.

I might have a month that I get a 2% return, I might have a month that I get a 6% return. It just all depends, but being consistent with the mail has helped me out a lot. And apart from getting deals through it, it builds a lot of credibility, because you’re getting off-market stuff, and buyers love that.

When I get an off-market deal and I’ve got them through mail, it really builds a lot of hype towards the properties that we’re getting, and it shows that we’re active out there. We’re not only getting deals that are on-market, but we’re also really hunting for those deals that are off-market.

Joe Fairless: No one else has mentioned the “building the credibility because you’re getting off-market deals”, and I’m glad that you did, because I never thought of that.

Raul Balufe: I saw that happening, because I’d be like “Man, this house’s price is the same as the ones that are on the MLS, but we’re getting three times the amount of calls.” So as I start talking to these people, they’re like “Yeah, but I haven’t seen this deal before. How many more of these do you get?” I’m like “I’m actually getting them more frequently now because I’m doing a lot more marketing.” They’re like, “Okay, make sure you put me in your VIP list. Make sure you get me on there.” I’m like, “Alright man, will do.” I started noticing that… And it gets more buyers, and you can then turn those buyers into people who buy other properties.

Joe Fairless: I like that. And what about the worst investment you’ve made back into your business?

Raul Balufe: The worst investment that I made back into my business… Great question. Well, I would have to say it was maybe spending it on systems that I didn’t need. I don’t wanna name any names, because I’m not out here to bash anything, but mainly just systems that you don’t need. Try to simplify your business.

Obviously, you need a CRM, or you need certain sheets or computers or software or whatever, but don’t get over-hyped on all that stuff. Get stuff that works for you and that makes it simple to buy and sell houses, or whatever your business is. So maybe that was a big spending mistake.

Joe Fairless: I’m not asking you to name a name of the system or the software or whatever, but I would be curious to know – and I’m sure the listeners are as well – what functionality did that have that you were like “I don’t need that.”

Raul Balufe: Well, functionality maybe not so much, but more like — for instance, I had one CRM for buyers, one CRM for sellers; I had another CRM for contacts… But one CRM could have done all three, if you can find a way to customize it, or whatever. So I was kind of like falling in love with “Oh, this CRM has this feature, this CRM has these features”, but do I really use all those features? I’d rather just put in one platform and customize it as best as I can, even if it takes a little bit more labor… But really get it on one system so it’s just more organized, more clean. You go to one place to find all your leads, one place to do your follow-ups… It works a lot easier.

Joe Fairless: What CRM do you use? Because obviously you’re happy with it if you’re using it.

Raul Balufe: I use FreedomSoft. I’ve been using it since I’ve started. It made a lot of good changes recently. I know Rob Swanson took over not that long ago. I really like it; it works perfectly for me. For buyers, sellers, you can put your contracts on there… I like the new leads tab; you can get phone numbers, and stuff… It’s pretty cool. I don’t even use all the features, but it has a ton for me to use and it’s really user-friendly. It’s nice, I like it.

Joe Fairless: Best Ever listeners, you can listen to our interview with Rob Swanson, episode 772, how he scored ten million dollars at the bottom of the real estate market.

What is your best real estate investing advice ever?

Raul Balufe: My best advice is pretty much staying consistent. I was actually talking to somebody today – it’s really easy to give up in real estate. Real estate was never made to be a short term gain type of business; it’s always been like a buy and hold business, or buy your home, resell it in a year, or whatever. If you stay consistent, constantly talking to leads, sending mail or whatever way you like to get leads, and you take the right actions, you can succeed; you will succeed. You just have to be consistent.

Joe Fairless: How do you educate yourself? Because your mind has evolved more than other early 20-year-olds that I’ve come across, so clearly you’re into personal development, and you’ve mentioned some podcasts… Where do you get that information from, and have you always been that way?

Raul Balufe: I’ve always been very curious and I kind of wanna know how everything works, so that was kind of like in my nature, but podcasts have helped me a lot. You can just find so much information on podcasts… Your podcast – you have a ton of interviews with very interesting people, successful people… A ton of all these other real estate podcasts – I mentioned Joe McCall, Sean Terry, Matt Theriault… If you just listen to a bunch of these podcasts, you get a lot of knowledge… Way more than you even need. So that definitely helps a lot.

I read books… I know you’re big on books; you ask for everybody’s favorite books at the end of this show… So I love books, podcasts, YouTube, webinars… A little bit of everything. There’s tons of free education out there.

Joe Fairless: What are some of your favorite go-to resources?

Raul Balufe: Well, I purchased some of the courses from Sean Terry and Matt Theriault – I’m constantly going back to those courses. I like to refeed that material back in me; even if it’s like the basics, it’s always important to know the basics. Once you fully understand that, you can really start thinking like “Okay, in my business how can I implement the basics again?”, whether it’s sending mail, or… However you get leads – MLS – you always gotta go back to the basics, buying and selling. That really helps me a lot.

Podcasts – I listen to your podcast, I listen a lot to Matt Theriault and Epic Real Estate…

Joe Fairless: Now I wanna go back to the direct mail marketing, because you said that’s been the best investment you’ve made back into your business, and you’re consistent with it. Will you define what consistent is as far as frequency and how many you send out?

Raul Balufe: I’ll get a list and I will send once a month for six months minimum. Whatever list that may be and however many people, I’ll send for a month, every month, six months straight… And different pieces of mail. I’ll send a postcard one month, a letter the next month, then another postcard, then another letter… All different for six months. I think that anybody hitting a list should at least hit it three months back-to-back-to-back, and for ultimate results, six months.

Joe Fairless: And have you looked at how many leads you’re getting from the one, two, three, four, five and six-month mailers and have you seen which mailer generates the most leads as far as one through six months?

Raul Balufe: I have tracked that, however I will say — that’s kind of a good question, but what I see is that I get easier sales or easier acquisitions months four, five and six. Maybe the leads won’t be the same amount, but it’ll be a lot easier to get that house under contract, because they’d already seen my name for three months or four months; I don’t know if that makes sense.

Joe Fairless: Yes, that does. Are you ready for the Best Ever Lightning Round?

Raul Balufe: Yeah, let’s do it.

Joe Fairless: Alright. First, a quick word from our Best Ever partners.

Break: [[00:18:08].15] to [[00:19:00].00]

Joe Fairless: What’s the best ever book you’ve read?

Raul Balufe: The 10X Rule by Grant Cardone.

Joe Fairless: He’s a Florida guy, isn’t he?

Raul Balufe: Yeah, he lives in Miami. He lives in [unintelligible [00:19:06].27]

Joe Fairless: Best ever deal you’ve done?

Raul Balufe: The second property I bought – a single-family home. I bought it for like 47k, put in like 20k; I’ve been renting it for three years and I just got it appraised for like 150k.

Joe Fairless: Congratulations. How did you get the money to buy that single-family home?

Raul Balufe: I had already wholesaled a couple houses, so I had some money saved up. Then I got a hard money lender.

Joe Fairless: Do you still have that hard money loan on the property?

Raul Balufe: I do, I have renewed it for these years, but I am in the process of refinancing it with a conventional bank.

Joe Fairless: Best ever way you like to give back?

Raul Balufe: I actually enjoy teaching and mentoring people who are not as fortunate or maybe not as savvy with information or school. I like to kind of just speak motivation to them as much as I can, and share with them any secrets or anything that helped me along the way or keeps helping me in my business. I like to help people who kind of see things a little bit differently.

Joe Fairless: What is a mistake you’ve made on a transaction that you can think of?

Raul Balufe: On a transaction… Definitely with buyers – collect their escrows. That sounds simple, but man, these buyers are sharp.

Joe Fairless: Will you elaborate on that?

Raul Balufe: So if you’re selling a wholesale deal, a lot of times for me if I’m doing [unintelligible [00:20:35].05] I gotta put that escrow; so I’ll sell it to a buyer, I’ll get the contract signed, and in the beginning I kind of put it off, like “Okay, it’s a done deal…” But then a week will pass by, they never followed up, they never sent deposit, and they’re like “Okay, I don’t want the deal anymore for some reason”, and now I have to rush and find another buyer, do this, do that… That will all be avoided if you collect the deposit or have them sent to the title company when you sell the property to them.

Joe Fairless: What’s the best place the Best Ever listeners can get in touch with you?

Raul Balufe: They can go on our website or our Facebook, Capital Rise Investments LLC, or CapitalRiseInvestments.com. I have my office number there and my e-mail – all that information if you guys wanna get a hold of me.

Joe Fairless: Raul, thank you for being on the show and talking about how quickly you’ve gotten out of the gate in real estate, in two years, from 21 to 23, having wholesaled on average over 15 million dollars, which I think was on average like 200 or so houses (I think) when I did that math…

Raul Balufe: Right. 80 houses a year.

Joe Fairless: Yeah, 160… Yeah, I knew that didn’t sound — yeah, 160. I was doing the math off of the 68k, so that’s what it was. But it’s very impressive what you’ve done and the team that you’ve built, and how you have put a premium on the learning and then applying what others have done and then replicating the model. I think that’s the storyline for this conversation – you’re not recreating the wheel, you’re simply implementing what’s been proven that other people have done and you’re taking massive action and you’re scaling along the way.

Raul Balufe: A mix of education and action is definitely the way to go in any type of business or in anything you do in life; as long as you learn the right things from the right people and implement the action and you do it consistently, you’re set up for success. You cannot fail.

Joe Fairless: You summarized that much better than I could. Thanks for being on the show. I hope you have a best ever day, and we’ll talk to you soon.

Raul Balufe: Thanks, Joe. I appreciate it. Take care!

 

 

Subscribe in iTunes and Stitcher so you don’t miss an episode!   https://www.youtube.com/channel/UCwTzctSEMu4L0tKN2b_esfg

Best Ever Show Real Estate Advice from experts

JF771: You’re Not Running a Wholesale Business Until You’ve Done This

Listen to the Episode Below (25:02)
Join + receive...
Best Real Estate Investing Crash Course Ever!

Have you failed yet? Do you consistently month after month wholesale properties with the team that works cohesively? If you’re still struggling then you may not have all the pieces. Our guest is extremely persistent and has had it pretty rough before he finally started to net approximate $13,000 per deal, hear how he did it and how he built his team.

Best Ever Tweet:

Alex Pardo Real Estate Background:

– Founder of FlipEmpire.com & Creative RE-Solutions, LLC
– Has flipped well over 300 properties
– Specialize in wholesaling residential and multi-family real estate investments
– A former GE financial analyst
– Based in Miami, Florida
– Say hi to him at www.FlipEmpire.com

Want an inbox full of online leads?

Get a FREE strategy session with Dan Barrett who is the only certified Google partner that exclusively works with real estate investors like us.

Go to http://www.adwordsnerds.com strategy to schedule the appointment.

Subscribe to Joe’s YouTube Channel here to learn multifamily and raising money tips:
https://www.youtube.com/channel/UCwTzctSEMu4L0tKN2b_esfg

Subscribe in iTunes  and  Stitcher  so you don’t miss an episode!

Best Ever Show Real Estate Advice from experts

JF754: A 5 Step Process for Raising BIG Capital #skillsetsunday

Listen to the Episode Below (28:48)
Join + receive...
Best Real Estate Investing Crash Course Ever!

Today’s guest has been on the show, and he is an expert at managing big money. If you recall on episode 447 he manages the family office for billionaires. In this episode you hear his five steps to raising private capital.

Best Ever Tweet:

Richard Wilson Real Estate Background:

  • Works with $100 million families
  • CEO of the Family Office Club, largest community of family office professionals with over 1,000 registered family offices and quarterly live events
  • Runs a single family office with over $500M in real estate assets and has three billionaire families under contract as their buy-side deal advisor
  • Author of #1 bestselling book on Amazon within the wealth mgmt. category called, The Single Family Office: Creating, Operating & Managing Investments of a Single Family Office
  • Host of the popular podcast Family Office Podcast
  • Based in Miami, Florida
  • Say hi to him at singlefamilyoffices.com

Want an inbox full of online leads?

Get a FREE strategy session with Dan Barrett who is the only certified Google partner that exclusively works with real estate investors like us.

Go to http://www.adwordsnerds.com strategy to schedule the appointment.

Subscribe to Joe’s YouTube Channel here to learn multifamily and raising money tips:
https://www.youtube.com/channel/UCwTzctSEMu4L0tKN2b_esfg

Subscribe in iTunes  and  Stitcher  so you don’t miss an episode!

 

JF568: Why He Finds the BUYER Before He Negotiates the Deal

Our guest is creative, and serious about all his exit strategies. He finds a buyer before he negotiates a deal which will ensure the sale. We also purchased a large commercial building and bought out the tenants to re-rent at higher rates to eventually create a better cash flow investment to resell later. You have to hear this man’s show!

Best Ever Tweet:

Adam Cohen real estate background:

  • President of West One International
  • 23 years of experience as a real estate investor, hard money lender, developer and advisor
  • Based in Miami, Florida but works in the UK as well (as you’ll hear from his accent)
  • Say hi to him at Westoneinternational.com
  • His Best Ever book is The Magician by Raymond Feist

Listen to all episodes and get a FREE crash course on real estate investing at:http://www.joefairless.com

Are you committed to transforming your life through Real Estate this year? If so, then go to http://www.CoachWithTrevor.Com and claim your FREE Coaching Session.  Trevor is my personal real estate coach and I’ve been working with him for years. Spots are limited, so be sure to do it now before all the spots are gone.

Subscribe to Joe’s YouTube Channel here to learn multifamily and raising money tips:https://www.youtube.com/channel/UCwTzctSEMu4L0tKN2b_esfg

Subscribe in iTunes  and  Stitcher  so you don’t miss an episode!

Listen to the Episode Below (23:44)
Join + receive...
Best Real Estate Investing Crash Course Ever!

JF447: What BILLION DOLLAR Investments Look Like with a Single Family Office

Yes, billion with a “b” is what you saw in the title. Our Best Ever guest researched general investments and stumbled upon the Family Office sector. He began blogging about the niche and grew fascinated while working a day job…then it exploded. Hear how he was invited to speak around the world and manage investments of up to three billionaire families!

Best Ever Tweet:

Richard Wilson’s Real Estate Background:

  • Works with $100 million families
  • CEO of the Family Office Club, largest community of family office professionals with over 1,000 registered family offices and quarterly live events
  • Runs a single family office with over $500M in real estate assets and has three billionaire families under contract as their buy-side deal advisor
  • Author of #1 bestselling book on Amazon within the wealth mgmt. category called, The Single Family Office: Creating, Operating & Managing Investments of a Single Family Office
  • Host of the popular podcast Family Office Podcast
  • Based in Miami, Florida

Subscribe in iTunes  and  Stitcher  so you don’t miss an episode!

Made Possible Because of Our Best Ever Sponsors:

You find the deals. We’ll fund them. Yes, it’s that simple. Fund That Flip is an online lender that provides fast and affordable capital to real estate investors. We make funding your projects easy so you can focus on what you do best…rehabilitating homes. Learn more at http://www.fundthatflip.com/bestever.

What’s the Best Ever health plan for YOU?

Go to http://www.stridehealth.com/bestever and find a better health plan in 10 minutes or less. On average you’ll save $418 on coverage and care.

Listen to the Episode Below (34:28)
Join + receive...
Best Real Estate Investing Crash Course Ever!
Best Ever Show Real Estate Advice

JF298: Why YOU Need to Start Gaining Clients From Social Media

Today’s Best Ever guest shares with us how he gains clients from social media and his blog and how to determine what is REAL and what is speculation. We also discuss all you need to know about real estate investing in Miami, and why it may be the market you are forgetting about.

Best Ever Tweet:

Adrian Foley’s real estate background:

–          Attended law school and keeps his law license active but focuses the bulk of his time to real estate

–          Real estate agent at GSL Properties based in Miami, Florida who works with buyers and sellers in Miami’s top luxury submarkets

–          Fluent in both English and Spanish

Subscribe in iTunes  and  Stitcher  so you don’t miss an episode!

Made Possible Because of Our Best Ever Sponsor:

Patch of Land – Want to learn more about crowdfunding? Let the leading expert in the crowdfunding space, Patch of Land, give you all the info you need to get started. Grab your FREE copy of Top Ten Answers to the Top Ten Crowdfunding Questions athttp://www.PatchOfLand.com/bestever

Local Lead Generator – Need more leads? Read the “Small Business Owners Guide to Local Lead Generation” in order to generate more leads. Visit localleadgenbook.com for more info.

 

Listen to the Episode Below (25:49)
Join + receive...
Best Real Estate Investing Crash Course Ever!
Best Ever Show Real Estate Advice

JF190: Using a Video LOI to Win a Deal that Netted $20M Profit

Today’s Best Ever guest shares with you the journey to go from nothing to a millionaire. He also tells you about the power of a video LOI and how that helped his beat out 38 other bidders to win a deal.

Best Ever Tweet:

Grant Cardone’s real estate background:

–        New York Times bestselling author and has written four business books including  The 10x Rule and If You’re Not First, You’re Last

–        Spent more than $280 million on real estate in last two years and plans to invest $1 billion by the end of the decade

–        Appeared on HGTV’s reality show “Selling LA” to market his $18 million LA home and has since moved to Miami, Florida

Subscribe in  iTunes  and  Stitcher  so you don’t miss an episode!

 

Sponsored by Patch of Land – Could you do more deals if you had more money? Let the crowdfunding platform, Patch of Land, find investors for you and fund your next deal…and your next deal…and your next deal…and…well, just go find out more at http://www.PatchOfLand.com

Listen to the Episode Below (29:28)
Join + receive...
Best Real Estate Investing Crash Course Ever!
Best Ever Show Real Estate Advice

JF162: Insider Scoop on Blind Pool Funds AND What You Don’t Know About Note Buying

Today’s Best Ever guest shares how blind pool funds work and gives you info on next level financing advice based on his extensive experience in the real estate finance industry.

Best Ever Tweet:

Dion DePaoli’s real estate background:

–        CEO at Secure Debt Exchange Systems based in Miami, Florida

–        Direct experience with real estate and mortgage investment fund management, asset management and disposition

–        Over 15 years in real estate finance and you can say hi to him at http://www.sdxs.us/

Subscribe in  iTunes  and  Stitcher  so you don’t miss an episode.

 

Sponsored by Patch of Land – Could you do more deals if you had more money? Let the crowdfunding platform, Patch of Land, find investors for you and fund your next deal…and your next deal…and your next deal…and…well, just go find out more at http://www.PatchOfLand.com

Listen to the Episode Below (17:14)
Join + receive...
Best Real Estate Investing Crash Course Ever!

JF32: How to Collect the Most on an Insurance Claim

Listen to the Episode Below
Join + receive...
Best Real Estate Investing Crash Course Ever!

You’re standing in 4 feet of water. What’s your next step to getting the problem fixed and reimbursed for the damages? Today’s Best Ever guest is a public adjuster who represents property owners when they file insurance claims.

Tune in to listen to his Best Real Estate Investing Advice Ever!

Les Weitman’s real estate background:

– Works as a public adjuster representing property owners who file insurance claims

– Became a real estate agent at age of 18

– Host of popular real estate investing podcast called Life on PIRE

Subscribe in iTunes and Stitcher so you don’t miss an episode!

Sponsored by: Door Devil – visit www.doordevil.com d enter “bestever” to get an exclusive 20% discount on your purchase.