Kris Ontiveros Shares How He’s Acquired 130 Doors in the Past 18 Months

Steve Trang: Hey, everybody. Thank you for joining us for today's episode of Real Estate Disruptors. Today, we have Chris Ontiveros, AKA Cashflow Chris, which I think is a really neat nickname. Another player in the Phoenix market, and he's gonna talk today about how he's bought a a 130 doors in the last eighteen months. Ridiculous numbers.

If this is your first time tuning in, I'm Steve Trang, founder of the OfferFast Homes app, the only MLS for off market wholesale properties. And I help entrepreneurs create businesses that support their family, lifestyle, and goals through mentorship. I'm gonna mention you create 100 millionaires. If you wanna be part of that, drop me a message on Instagram at steve dot trang. If you're excited for today's show, please give me a wave, give me a thumbs up.

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You can share this episode right now, tag a friend below, or tell them your best takeaway from the show later on. That way, we can all grow together. And this is a live show, so please ask your questions for Chris to answer. You ready?

Kris Ontiveros: Oh, I'm ready. I love q and a. Let's do it.

Steve: Alright. Perfect. So what got you into real estate?

Kris: What got me into real estate? So back in, the early two thousands, I was up in Portland, Oregon, and I was having a lot of fun in my early twenties, but my life wasn't really going anywhere. I never went to you know, I well, actually, I went to a lot of colleges. I never finished college. I didn't know what I wanted to do, and I actually got in a really bad car accident.

And so that brought me back here to Phoenix so my mom could take care of me, man, because my my, my roommate sure as heck wasn't gonna take care of me, and I I was in a bad way. Yeah. So I while I was re on the mend, my mom had just gone to a Rich Dad event in in San Francisco. Mhmm. And so I found Cashflow Quadrant.

Steve: Mhmm.

Kris: And I read Cashflow Quadrant, blew my mind.

Steve: Before Think and Grow before Rich Dad Poor Dad?

Kris: Uh-huh. Yep.

Steve: Interesting. Okay.

Kris: Yeah. I because I didn't know who he was. I didn't know anything about the entrepreneur space. I was just I partied. I just did whatever.

Right? Cash flow quadrant blew my mind because I didn't even know that this was possible. I didn't know I could be an entrepreneur. I didn't know about investing, owning a business, those types of things. Right.

And then, yeah, from there, it went to Rich Dad. And, from there, I quit my job. I got up my Doing. Inbound sales, dollars 12 an hour crappy job. Yeah.

I got yelled at by old people who had a $50 bill. Like, I got yelled at by people where I don't want to end up where they are. You know what I mean?

Steve: Yeah. Yeah.

Kris: So, yeah, I quit that job and got my real estate license and started learning sales.

Steve: In what year?

Kris: 2004. December 2004, I got my license.

Steve: Yeah. License 2004. So you meant to enjoy a little bit of that run up.

Kris: It was crazy. Yeah. It was actually kind of difficult to find to get a deal done because everything sold so fast. I was brand new. So I kind of hopped into the rental, market.

I would this was when Craigslist was brand new. So all I would do as a realtor, I would go find an out of state number, and I would call them in an offer to list their house for rent, you know, for, like, $500. And that's how I made money, and that's how I built my investor list as well.

Steve: Wow. Well, people don't know, you know, getting started in that time. Well, it's so hard to find a house that people would follow the trucks with the post in the back. Yes. And as soon as the post is in the ground, you would call that sign.

It's like, hey, I have a buyer for this house. Mhmm. It's a crazy time.

Kris: It was insane. We're we're feeling a little bit of that now.

Steve: We are a little bit.

Kris: But, yeah. It's houses were sold before the post went in the ground. Yeah. I I bet you that's a true story. That's like an urban urban legend.

Oh, that's real. But I bet you that's true.

Steve: That's real.

Kris: It was wild here.

Steve: Okay. So you started dealing with out of state investors Mhmm. As a realtor listing the rental properties.

Kris: Yep.

Steve: And then how did you get to, you know, become cash flow Chris?

Kris: Okay. Yeah. So that's how I got started. You know, we ramped up. I, you know, I had, you know, some success pretty quickly in in sales.

Steve: Listing rentals.

Kris: Yeah. No. No. No. So that's just how I got started.

Eventually, I started working with buyers and taking listings in your traditional real estate. I mean, you should have seen me. I had a nice blue shirt and khaki pants for every day for every day of the week.

Steve: Me too.

Kris: That's why I got out of it. It drove me crazy. But, no. I became good pretty good at sales. We were talking earlier.

I joined Toastmasters. I took a lot of sales training, and I got pretty decent at it. But my most successful year, though, actually, it was the first year that I ramped up to 6 figures. I got into real estate because I didn't want a boss. And I realized I had, like, 50 bosses because every single client that I took on was my boss.

They were in charge. And so that's when I really decided, you know, I need to start getting into investing and and, you know, buying buying properties. So and then the market crashed. Right. Right.

So that was rough. You know? But I got on with the REO company. Yeah. So

Steve: Oh, which one?

Kris: It was oh my gosh. That was so long ago. I don't even remember the name. I don't remember the name. You

Steve: wanna let the listeners know who which what REO company is?

Kris: Okay. So it's now 2009, and we massive amounts of foreclosures. Like, thousands and thousands of houses in the Phoenix area are in foreclosure, especially the South Phoenix market, which is where I was located.

Steve: Mhmm.

Kris: A lot of new builds. Right? South Phoenix, Laveen, lots of brand new houses, and they were going management company to get rid of them. They just gotta sell them. Well, the asset management company

Steve: Almost like a disposition agent.

Kris: Exactly. But their job is to get rid of them as soon as possible. Right. Because, you know, they can't they can't do loans. There's a lot of reason why they sell REOs quickly.

The asset management company worked for took a different look at it because it was a race to the bottom. It was. Right? I I would have a Bank of America listing, and there would be seven others in the neighborhood. So I'd point at that one, Oh, we gotta be less than them, and then they gotta be less than us.

So everybody's dropping, dropping. And they had to go to cash buyers because, you know, you'd have a missing AC or little stuff. Right? So it's a brand new

Steve: house Mhmm. But

Kris: it's missing an AC unit, so they're gonna take a $40,000 discount. Right. So our asset management company taught us how to do, cosmetic remodels. So on something like that, we would carpet, paint, throw an AC unit, and we would sell it for 40,000 more for the for the bank. So we would make them more money.

And it wasn't too much more time, a little bit. But so that's how, basically, I got paid to flip, like, 30 or 40 homes.

Steve: Mhmm. Cool.

Kris: And so, yeah. So when the market started getting better, all those ended up drying up. I lost all my REO accounts eventually.

Steve: Mhmm.

Kris: And so I'm like, I'm in. Let's do it. And I started fixing and flipping. I actually I know this is for a wholesaler. While I do wholesale as a tool, I've never been a wholesaler just because I was able to skip that.

Steve: Yeah. So that's pretty cool. And, you know, being an REO agent, it was just, it was a different time. So I remember, like, for the bank properties, you had to put the signs up. Like, you didn't have a choice.

Yeah. Right? But I also know that the moment I put a sign up, an AC seemed stolen.

Kris: Mhmm.

Steve: So with my clients Oh, yeah.

Kris: So I got a good story about that. So people would literally find once they were listed, people would search the MLS every day to know what AC to steal. Yeah. I had one asset. They they sent it to us.

We had it for a month the day I listed it. That night, AC got stolen. So people were literally fishing off the MLS. Right.

Steve: So I had clients where I would tell them, like, Hey, you know what? I just When we go live, I am not putting this out in your yard. I don't want to deal with your AC unit getting stolen.

Kris: Right. So We had to start caging all of them. Yeah. We'd put it on, you know, we'd have to buy a cage.

Steve: So you transition and you to flipping. Mhmm.

Kris: And you

Steve: were flipping a lot of houses. Like, what were you doing?

Kris: Yeah. So yeah. So now we're in 2010, 2011, 2012. I started flipping a little bit because the market was still pretty soft. But that's when I started buying cash flow properties.

Steve: Mhmm. Great time.

Kris: Oh, yeah. It was amazing. So one of my investor clients, he was buying fourplexes here in Phoenix. And so we got to the you know, I just you gotta dig. You gotta know what what's what your clients want exactly.

And so I asked him, What kind of rate what kind of return are you trying to get with these fourplexes? Because they're a lot of work.

Steve: You

Kris: know? And he's like, Oh, if I can get a 12% return, I'm gonna be happy. Well, I I was eyeing a house in South Phoenix, a three bedroom for $25, but it was it wasn't in distress. It was a short sale. So I said, Hey.

What if I pay you 15% if you fund my property a 100%? So he said, Yeah. Absolutely. And so, yeah, that first deal, I it was I borrowed 25,000 at 15%, so my payment was, like, $3.23 30. And I rented it the next week for $7.50.

Yeah. And then I went and I just kept doing that.

Steve: Yeah. Yeah. That's awesome. So, that's when you just went full bore into cash

Kris: flowing. I wish I could say yes. I ended up selling a lot of those. Almost all my rentals, I to fund my fix and flip projects.

Steve: Right.

Kris: And so Yeah. So it was good. I needed the cash. You know, my businesses were really up and down, and so I ended up selling a lot of them. And it was great.

I mean, we'd buy them for 25. We'd sell them for 90, 110. Mhmm. But one of my mantras is you you, you flip for cash, but you hold for wealth.

Steve: Right.

Kris: All those are worth, like, 200,000 now.

Steve: Yeah.

Kris: Right? So the big cash flow started a little over two two and a half years ago when me and my business partner, BP, we were sitting there, and we were making a ton of money, but we were making a ton of money, but we had some deals that would go bad. And, you know, it's like we worked and we're making money, but we don't have anything to show. We still gotta go find another deal Mhmm.

Steve: And another deal and another deal.

Kris: And as you know in Phoenix, things have been tight for the last, like, three or four years.

Steve: Right.

Kris: And so now we're starting to buy deals that don't make all a lot of sense, you know, just to keep the pipeline going. And it

Steve: was all these damn wholesalers.

Kris: Yeah. Yeah. Wholesalers taking all the money out of it. So that's when we're like, we're done. We know how to do cash flow.

We've already we already own some rentals. We've we know how to do this. And so that's when we decided we're gonna go start buying apartments.

Steve: Gotcha. And so, that's when cash flow

Kris: That's when it really started going, yeah.

Steve: Okay, so let's talk about that. So, you made a conscious decision to go after apartments. Yes.

Kris: Because it

Steve: was like a year and a half ago. Yes. Okay. What was the thought process saying?

Kris: It was about two and a half years ago when we decided,

Steve: but

Kris: we started buying a year and a half ago. Because you gotta learn, and, you know, we had to pick our right strategy. And then we started looking for deals and networking and, you know, finding the right people who can bring us the right deals. Right. And we finally landed one that we closed in 2018 in Hope, Arkansas.

Steve: Interesting. So But let's talk about the thought process.

Kris: Yes. Right?

Steve: What was in the calculations or decision process or was it just really obvious when you say, I'm going to start buying apartment complexes?

Kris: No. We wanted to go with the right strategy. We went with, BP went to a Marco Kozlowski event. I don't know if you know who he is, but he teaches apartments, and he's real, I don't know. I like his style just because it's, you're just looking for big big cap rates.

Steve: Mhmm.

Kris: You're looking for properties that are value add that can get really high returns, because that way you can give a third away to your investor and and still maintain. So that was kinda the strategy. We didn't follow it exactly, but we just basically started looking for really high equity deals Mhmm. And high cash flow deals.

Steve: Right. Okay. So then how did you guys find that first apartment?

Kris: How we find almost every deal networking.

Steve: Okay.

Kris: That that deal was brought to us by, actually, a Phoenix investor. Mike Crane bought us that deal. He lives here, but he he was, searching LoopNet, and he's been, you know, he got in contact with this guy. And, the guy had been a motivated seller for a little bit, for probably two years, because we knew a couple other investors who tried to get the property. Mhmm.

But he had just come down with, cancer. Mhmm. And so he got really motivated. He wanted to sell it now. So Right.

Steve: Is that the same one that you did with Corey? Is that different? What's that? Didn't you guys do a deal with Corey?

Kris: Corey Peterson? Thompson. Corey Thompson.

Steve: No? No. I thought you guys did a deal with him.

Kris: No. No. No. Corey got us set on Netfolio, though. And so, yeah, we met Corey here in town, and, he got us going in Netfolio, which that's been a game changer for us.

Steve: Well, talk more about that.

Kris: You wanna go into that? Yeah. Okay. AppFolio is a is a software, not an affiliate. So I'm not telling saying this for any other reason Yeah.

Except it's totally changed our world. So AppFolio is an all all encompassing, product. So we all know the difficulties of management, especially if it's out of state. You know? Arkansas, 10,000 people in the town.

Right? Like, how do you find a property manager? There are none. How do you manage these deals? So, AppFolio allows us to manage our 130 properties

Steve: Mhmm.

Kris: All virtually. And because we it can be done virtually, our assistants in The Philippines run all of our properties for us.

Steve: Mhmm.

Kris: So AppFolio does kind of everything. So we think if you think about what your property manager does for you, here's what our property managers in boots on the ground don't have to do. They don't do marketing. They don't take applications. They don't run credit.

They don't do leases. They don't accept rent. They don't do maintenance calls, or they don't you know what I mean? They don't call them for maintenance. Right.

Steve: All

Kris: of that is done within the system. Mhmm. So because of that, that, it's allowed us to just go wherever we want. It's it's amazing. Yeah.

So earlier today, we had our meeting every Wednesday for two hours. We we have discussions with our VAs. VAs. We have our two main apartments and then Cleveland. We're pretty big in Cleveland now.

Steve: So Who's we?

Kris: BP and I.

Steve: Okay.

Kris: So I have two sides of my business. Over here, I have my real estate development side. That's how we make our cash. And then over here is my cash flow side. BP is my bar my business partner on that side.

Steve: Gotcha. So two apartments. One in Hope, Arkansas. How many doors is that? So Hope's 27.

Mhmm.

Kris: Bisbee, we have, 52 Mhmm. Including some RV spaces. And then 15 units in Douglas, which is over there by by Bisbee. I have eight units in Mesa, another seven in Phoenix, and then Cleveland. Yeah.

We're we hope to be at a 100 units in Cleveland by the end of the year.

Steve: You guys don't discriminate a location at all?

Kris: No. It's gotta be high cash flow. Cleveland was by design. I did a lot of research to find a market. Because if we're gonna buy these cheap properties somewhere, I don't wanna buy one or two sporadically.

Steve: So let's talk about that. Because that's something that, my partner, Max, and I, you know, were talking about because, you know, I went to, Real Estate Roundup. Right? Mhmm. This is Brent Marino and Adam Johnson, big sip.

And, there's these guys on stage talking about, yeah, I've been wholesaling for like a year and a half, two years. And last year I bought 16 properties. Like, what? I've been wholesaling for a while. I didn't buy 16 properties last year, right?

So I started talking about it. What are you talking about? I was like, Yeah, I'm buying these properties for 20,000, you know, you just have to put 8,000 down with the bank and they'll finance the rest. Crazy numbers.

Kris: Crazy numbers.

Steve: Right? And so, since then, it's come up with every quarterly off-site traction meeting I have with Max. It's like, Okay. We need to pick a market that was going to acquire rentals.

Kris: Yeah. And that's all we're going to do. Join us in Cleveland, my man.

Steve: So, let's talk about decide how did you and BP decide on Cleveland?

Kris: So I had to get BP on board. I I bought three before I even went to Cleveland just because the numbers were crazy. But once we went there, we were both all in.

Steve: Mhmm.

Kris: So I I researched a bunch. I I used to you know, the wholesale world, the investing world, I would always get stuff emailed to me. And it's like, gosh. Look at these prices. $20,000, and it's already rented for this.

Like, must be in a war zone, whatever, which some of them are.

Steve: Right.

Kris: But just the numbers just intrigued me, so I started getting to know people in Cleveland. And then when I decided that, hey. I'm gonna buy some of these because you would get them from everywhere. I just started doing some research. Pittsburgh's so all of these I'm gonna name are great cash flow cities.

I just think Cleveland's the

Steve: best. Okay.

Kris: I researched Cleveland, Akron, Dayton, Columbus, Detroit. Detroit. Yeah. Pittsburgh. Where else?

There was a few more. Oh, Baltimore, Saint Louis. Yeah. Which Baltimore, Saint Louis are the number one and number two highest crime in the nation, which is that's exactly why we're not there. I'm hurt.

I'm hurt. Detroit's three.

Steve: I have friends in Saint Louis and friends in in Kansas City.

Kris: Yeah. Missouri is supposed to be a really good one. So, Cleveland, I just found we can get for the cheaper price with the higher rents. So, like, for example, Dayton. So in Cleveland, you're gonna buy if you're buying it right, you're gonna buy you'd be all in for $30 for a house that will rent for, like yeah.

For, like it'll rent for, like, 800, 900, Section 8.

Steve: Yeah.

Kris: And, so that same property in Dayton, we could still get it for 30, but it's only gonna rent for maybe, like, 7 or 600.

Steve: Mhmm.

Kris: In Detroit, you could buy that same house, but instead of 30, you're gonna be paying, like, 40, 45. So it was just kind of the perfect mix.

Steve: Why do you suppose that is?

Kris: I really couldn't. I don't know. Maybe because Cleveland might be a little behind on the city kind of booming a little bit more. Detroit I think Detroit's had a little bit more money put into it. Yeah.

There's more I think there's more investors moving into Detroit. But, yeah. Cleveland is we're we're high on Cleveland. Especially, there is a bullet train that's gonna be going in. Especially, there is a bullet train that's gonna be going in that's gonna get you from Chicago to Cleveland in twenty seven minutes.

Wow. That's that'll be a game changer for that city.

Steve: So these are all managed through was it AppFolio?

Kris: App a p p f o l I o. I need to get a affiliate

Steve: affiliate code. So all managed at Appfolio managed by which is run by the VAs. Mhmm. But you still have local boots on the ground?

Kris: Yes. So for each of our apartment, we do have a manager. But again, we don't so we don't have to pay them a lot because they don't do a lot. They're basically our handyman. So we have someone to take care of our maintenance issues.

Steve: Gotcha.

Kris: Yeah. So whenever something happens, we'll send the maintenance to them.

Steve: Sounds so small.

Kris: And then they're they're the ones talking to the tenants. You gotta have somebody there who like looks them in the eye, you know? Right. Because you can't tell a good tenant if you don't meet them.

Steve: So one thing I've heard from other investors, the reason why they don't like this strategy Mhmm. Is that cash flow is great, but there's no appreciation. Like, there's always gonna be a rental market.

Kris: Yep. What are

Steve: your thoughts on that?

Kris: Absolutely true. Yeah. So But we're investors. That 30,000, it's worth 60.

Steve: Mhmm.

Kris: It is. I've sold them. We've flipped a few of them. Like So you can easily buy with instant equity, and we buy knowing that it's not gonna go up. Right.

You know? And I don't care. That always makes sense. Because we're probably never gonna sell them. Why would I sell them?

You know, once we buy them, we get them running. When we get our long term financing in place, you know, we get our fifteen year financing. In fifteen years, our cash flow's gonna absolutely explode.

Steve: So you're buying all these on fifteen year financing?

Kris: We're buying them all with private money.

Steve: Mhmm.

Kris: And we are in the process of converting them all to long term. Yeah. We want it because we really wanted to ramp up, so we wanted to make it just easy, easy to say yes to us. So we The notes that we put on these properties, they're 70% loan to value max. They're 12% interest, and they're a year.

A year? Yeah. So say no to that. Right? I mean

Steve: So you're telling investors, I will pay you 12% for one year. And then what? And we'll refi them out. Okay. So then you're gonna have to get a mortgage.

Kris: Yeah. Within a year, we'll we'll get the mortgage. We're working on, we're trying to do a blanket so we don't have to do them one by one. Mhmm. So we can get 10 properties on one loan.

Steve: Are you trying to implement the BRRRR model? Yeah. I mean, that's really Okay.

Kris: That's exactly what it is. Yeah. Gotcha. We don't always Right.

Steve: A lot

Kris: of times, they're just ready to go, but not always.

Steve: That's incredible.

Kris: That's the other boots on the Cleveland, a big thing that we've had to do is so so it's easier when it's apartments because everything's right there. Mhmm. Cleveland, Cleveland, we're kind of all over the place. So we have a leasing agent to show the properties and and help with that, and then we have a great, GC. He's rehabbing all our stuff, and he loves us because we give him a ton of work.

Steve: Gotcha. And in Cleveland, they're all single family.

Kris: We have a few duplexes that we're finding out we don't like them too much. Because? You're dealing with more of a $500 tenant instead of a, even though we still we always try to do section eight. So if that's the point if it's that, it doesn't matter. But having that, tenant upstairs, I don't know, it's just not as good as a family.

Busy

Steve: versa. Two level.

Kris: They're always up down for the most part. Very few side by sides out there. Interesting. Yeah. And so, like, last week, we got a toilet leaking from tenant a Yeah.

Into tenant b. So luckily, they're sisters, so it's not that big a deal. But, so we're looking at single families and then fourplexes.

Steve: So let's talk about how you're finding these deals.

Kris: Networking. See, I'll tell you what. That's what we preach. That's we just network, network, network. Wholesalers are bringing us, like, 80% of our deals.

We did begin a marketing campaign, you know, like a SMS campaign to some distressed owners, and so we've got a little bit of traction there. But we buy We just We talk to everybody. I go on marketplace, and I just I don't It seems like I go on marketplace, and I just I don't see ask if it's available. I ask, tell me about yourself. You know?

Mhmm. How many are you a wholesaler? How many deals you got? This is we're buying five to 10 a month. You know?

Send me everything you have. I send them a map. This is where we buy. I let them know I'm serious.

Steve: Right. No, that shows them very quickly. Right? There you go.

Kris: This is what we already own. So networking, networking, networking.

Steve: So befriending all the wholesalers.

Kris: Defriending all the wholesalers. And then we went out there. That's where we you know, we took that GC to lunch. You know, we got to know him well and make it a win win with with him and all of our wholesalers. They know that if we say, yeah, we're gonna close.

And

Steve: So It's been great. Take a step back with the apartments. How are you I know you're saying it's networking. How are you attracting people to bring you apartment deals?

Kris: Networking. Right. Specifically. We just talk. It's we do the good old Brynn Daniels.

Right? We talk to people. We talk to everybody we know. And then, I don't know, man. I'm kind of, I'm not a religious person, but I I think the universe is out there.

When you put stuff out to the universe, it comes back. Right. And so we just start talking about, alright. We're ready for another apartment. Let's do this.

Steve: So is it So you know a lot of people out there, and you're obviously putting on social media.

Kris: Yeah.

Steve: But do you have like a routine, you know, like a prospecting routine? Like, all right, today I'm gonna call five wholesalers in Arkansas. Right. Five wholesalers in Bisbee. Mhmm.

You know, like, how do you talk to people intentionally?

Kris: Yeah. So I talk to a lot of people on Facebook for that because it's just, you know, a lot of the wholesale sites. There's just a lot of people out there. Yeah. And, and get to know them.

And, again, putting it out there, this is what we're looking for. If I go to a one of those wholesaling sites and I say looking for a Cleveland property with cash buyers, I mean, yeah. All these people are gonna respond, but, yeah, we put them in the database. And then, yes, absolutely, we we follow-up. That's that's one of my jobs is finding money and finding deals.

Steve: So let's pretend a wholesale is watching a show. There's a probability that's happening.

Kris: Yes, sir.

Steve: What are you looking for?

Kris: What am I looking for? Typically, we wanna be all in for under 40,000. We have certain ZIP codes that I could send. Mhmm. Yeah.

Single families and fourplexes are mainly what we're looking for. Gotcha. But what I will say is send me everything. I'll review it, and then I'll just you don't have to do it for me. Just send it to me, and I'll get my GC out there, and we'll get a number on it, and we'll make an offer.

Or we like to you know, I'm not a nickel dimer. If it meets my strategy, I'm not gonna try to save $2. I'm gonna say cool. Right. Lock it up.

Steve: What about multifamily? What are you looking for?

Kris: For now, Cleveland fourplexes, we would probably go a little bit bigger, but fourplexes are really nice. I mean, the spreads on them are crazy.

Steve: But outside of

Kris: Cleveland? Outside of Cleveland.

Steve: Because you're it seems to me like you're buying across the country.

Kris: We are. So to the metrics. Plus units, and we want a minimum 12 cap going in or close to it with a value add pro form a or No. Performing? We want it to be both.

Yeah. I'll look at every deal, you know. We took so Bisbee's a good example. We took it over vacant.

Steve: Mhmm.

Kris: But it was a motel that we converted to an apartment, so there was a major value add there, and it was already in good condition. So, typically, we wanna have some people in there, but, you know, we're gonna turn it.

Steve: Right.

Kris: Because that's our strategy.

Steve: Our strategy is we need to be

Kris: all in at two thirds of the value. So Arkansas, we have an appraisal at $7.50. We're all in for five. So that gives us our two thirds. So now we can refinance, pay all of our investors back while keeping them in the deal.

And so now that our investors have their money back, they're still part owners. Their cash flow is gonna reduce significantly, of course, because we're needing regular financing. But, yeah. So that's the goal. So that one, we owe 5.

It's worth $7.50. Bisbee, when we're done, we owe 9, and then it should be worth about 1.5.

Steve: Very cool. Awesome.

Kris: Yeah. Because we got we don't wanna owe too much. We don't have to come with cash.

Steve: So going back to what I was talking about earlier, you know, possibly expanding. Let's just say somewhere in Ohio. Mhmm. Right? You're paying $30.40 all in to wholesalers, but you're saying they're worth 60.

Mhmm. Why are they sending it to you versus somebody else?

Kris: There's a lot of them.

Steve: Okay.

Kris: And a lot of people don't wanna buy in the neighborhoods we're buying in.

Steve: Mhmm.

Kris: We physically walked the, the neighborhoods. They reminded us a kind of a merry vale.

Steve: Mhmm. You know

Kris: what I mean? Like, I'm not scared of Maryvale. There's some, o seven streets I don't wanna walk. But Maryvale, I'm comfortable in it. Yeah.

And that was the vibe we got. And so I'm I'm just comfortable being there. Ohio's got some stigma.

Steve: Mhmm.

Kris: You know? If you go out, especially to people in Ohio, Hey, I'm looking for Cleveland, and I got a East Cleveland deal. They'll be like, Oh, you know, stay away from East Cleveland. It's the devil. You know, like, there's just a lot of opportunity out there.

Gotcha. A lot of properties that need to be torn down, that have been there. So you

Steve: don't need to go direct to seller in these other markets, is what I'm hearing.

Kris: You don't need to, but we certainly are. Yeah. Yeah. I mean, that's the 20%. Eighty percent's from wholesalers.

And we wanna we just started market ramping that up, so we definitely wanna find our own deals. Absolutely. Gotcha. Because then we can get more into the seller carry kind of stuff, you know, the the creative where we don't even have to go find financing. Because your typical wholesaler, they're just they're programmed, you know, cash.

Quick close, all cash. Right? That's that's what we've been trained, and so they don't even ask if they would if they have a loan. Would you mind, you know, doing this, that? They don't even ask ask those questions, typically.

Gotcha.

Steve: So, you know, I started this show May '18, so coming up on two years. And, you know, it's gonna be cool doing the show live, on Facebook Live, you know, with the guests in the studio, you know, in person, which has been pretty cool. It's been really good for me. Yeah. What a lot of people don't know is that you were doing that even before me.

Kris: Yes, sir.

Steve: Right. You were doing flipping Fridays.

Kris: We were doing flipping Fridays.

Steve: Wanna talk

Kris: about that? Yeah. Flipping Fridays was a lot of fun. So AZ Flip Guys is our Facebook page, and we're on YouTube as well. Yeah.

We did a 100 episodes. It was just me and BP, my business partner. We would I would list all his properties. Right? Another reason to get your license.

You know, if you know investors, you get to list all their stuff. And we would meet every Friday just to discuss and talk. And we were just like, Man, we should just go live with it. We should just hit record and you know? Because we're so nonchalant and and and, you know, just chill about it.

And we started doing that, and it started out just teaching. You know? So we taught how to wholesale, how to fix and flip. Flip tips was a lot of it. And then we walked.

We literally walked them through two of those purchases on those apartments. We went through everything, several different episodes. And then we started doing the interviews like you, and that was great. You know, added a ton of value. We hit, we hit episode a 100, and then we kinda took a hiatus.

Yeah. I don't know. We might do something new, but it's gonna be based on cash flow. Right. Because neither one of us flip anymore.

Steve: Yeah.

Kris: Right? And so, you know, we're I'm doing new builds, BPs, strictly on the investing side.

Steve: Well, you're in the batch studio, so you get what you need.

Kris: Two, you get a 2,800 crew is simply amazing. Building, that this and that there you go again with, Universe.

Steve: Mhmm.

Kris: So my business partner, JD, I was over here in Mesa, and it was kinda cool because, my brokerage, they were shutting down that office at the end of the year. So for the last six months, I had, like, a 5,000 square foot building all to myself.

Steve: Really?

Kris: But I'm like, We gotta get people in here. I need synergy. You know, if I have these guys, you know, do this. Here's the deal. Check this out.

Comp that. You know what I mean? Like, so much more could happen. And so I was just with J. D, I'm like, Dude, I need a new office.

I need synergy, synergy, synergy. I want to be around people who are doing stuff. And then Houston was an absolute game changer for me.

Steve: Yeah.

Kris: And the universe brought me an office at 2800 North 24th Street, man.

Steve: Yeah. No. That's a killer, killer office. So we got any questions about any of this before we talk about new build. So we got lots of comments about your shirt.

Kris: Yeah. You can find that one online. I gotta add a little cash flow, Chris. Do it. And this is my thing, man.

It's all about, you know, assets and experiences for me. I don't really care about stuff too much. I wanna do things, you know, experience I went to the forty niners championship game on my birthday a couple of weeks ago. That was

Steve: I asked Chris to take his hat off before the show, but he wouldn't do it.

Kris: That was that was worth so much more than anything I could buy. Yeah. You know? It was just life experiences. My kids have been to, you know, Hawaii, Costa Rica, all these amazing places.

We went twenty two days. We went on a twenty two day vacation last summer. That's awesome. Across, you know, national parks around the nation. Like, it was just I love it, man.

Steve: Oh, you're doing it for the right reasons. Right? Kyle Tran wants to know, are you ever closing rentals in a trust that roll up into a parent LLC?

Kris: Nah, man. Too much work. Eventually, we'll probably roll everything into a trust, but at this point, we're just in massive accumulation mode. We do do separate LLCs. Probably do five to 10

Steve: Mhmm.

Kris: In an LLC. I know you should do it's just you know, we've got a lot of bank accounts, a

Steve: lot of LLCs.

Kris: Doctor. Darrell Bock Yeah. Doctor. Darrell Bock And you're

Steve: buried in paperwork. Doctor.

Kris: Darrell Bock Yeah. Doctor.

Steve: Darrell Bock Claudio Diaz wants to know, how does it work alongside the other top investors at the TTP office? Doctor.

Kris: Darrell Bock Absolute game changer. Well, I'm partners with them now. We're we have, us combined, we have $21,000,000 in the pipeline. We're building a 24 houses subdivision together. We are building a 60 unit apartment together.

Mhmm. We just took down some Buckeye lot. Like, they're they're starting to fund all of our deals. It's it's amazing. Yeah.

Right. It's great. And it's not even just batch. You know, we got Pace in the house every once in a while. Mhmm.

Got Brent Daniels. I mean, that guy just blows my mind. He's so smart. So many high level people. Just you're always in there.

Jamil's always in there. Right. That's the place to be.

Steve: It's crazy. It's crazy the people that get in there. Let's see what else is there. How did you find your GC in Cleveland?

Kris: Lisa Garcia wants to know. Networking. You know, BP found Charles. I don't really know exactly how, but I'm it was networking, you know? Just asking around, who do you use?

Who's your GC? So we, BP and I are both mentors in a group called the Kingdom Real Estate. And so

Steve: Oh, you are? Uh-huh. Oh, I already.

Kris: Yeah. It's just a thing that we just we do to just give back. You know, it's not a paid gig or anything. And so we have a lot of contacts in there. From that, we got a bunch of people in Cleveland.

That's probably how we met Charles, our GC.

Steve: That makes sense. Let's see. Thomas Bell wants to know how do you spell Marco's last name for the apartment investment training?

Kris: I would guess k o s l o w s k I m a r c o. He's on Facebook.

Steve: Alright. So let's talk about developing because the title of the show is about cash flowing Yeah. Which is massive. Yeah. Love cash flow.

But you have a whole separate business. Sure do. Let's talk about that business.

Kris: Yeah. So we, oh, about two years ago, I kept buying all these crappy flips. And I think I had a run of like three properties where at inspection, I had a sewer line come up that I had to replace, and I had two roofs that I had to redo. And I was done. You know, it's take it was cut to where you're only making $2,030,000 anyways, which in our market is not a lot.

I mean, that's this close to taking a loss if you're only making 20.

Steve: Mhmm. And

Kris: then you gotta pay $8.09 on top of that, and it's just it was so frustrating. And so I had done a few add ons. And so this is how kinda how it happened. I sold I flipped a house in South Phoenix, and it was a thousand square foot house. It was a newer one, a burn, a fire damage, and I sold it for $1.50.

So I think that's a $150 a foot, and I know what I can rehab for. And so I'm like, I bet you I could start start building. And I know a lot of other companies were doing it, but the one offs are a little bit more difficult because they're they're gonna cost more. And so I, I did a subdivision. I did an 11 lot subdivision right by there.

I didn't end up developing it. The partners kind of pushed me out on that one. Yeah. Always have your paperwork lined up. That was that was about 700,000 in profits that they made.

Steve: Wow. And I

Kris: didn't have a JV agreement. And so when my partner became a little bit financially unstable, he sold it. He sold half of the project off and said, Thanks, but no thanks.

Steve: Wow.

Kris: So lesson learned there. Mhmm. So that's so I did that. And then we just decided, hey, let's just start building. I found a found a a lot, and we got it direct from the seller.

Mhmm. We started going direct to seller, and it was great. I mean, we bought the lot for 40 no. We bought the lot for 38, I believe. We sold it to ourselves for 45.

I always pull cash at the beginning. And then we 130 was the build. So 175, and we sold that baby for $2.92.

Steve: It's pretty good.

Kris: Yeah. And we're building the lot next door right now. See you right now. Man, crazy problem. Now, they're all not all that good, but you can always maintain your, 20 plus percent profit margin.

Steve: So that's the goal, 20% of the final sales price.

Kris: Yeah. I learned, the fix and flip business from Robin Thompson. I don't even know if she's around anymore. She's she's awesome lady out of Florida. And so I just do her formula, which is similar.

She learned from Ron LeGrand. So what's it worth fixed up minus 30%, minus, for me, cost to build equals your land purchase price.

Steve: Right.

Kris: And so that 30% is 10% for holding costs and closing costs, 20% profit.

Steve: Gotcha. Simple enough. So, I mean, I already know the answer to this question. Where are you getting these development opportunities?

Kris: Yeah. Networking, but mostly we're going. I mean, this is our town. So, yeah, we've been, we've been going direct to seller.

Steve: Yeah. Well, we send you our land opportunities too. Uh-huh. Sure did. Yeah.

So when, Max's like, hey. We got this property, this land. Like, what should we do? I was like, talk to Chris.

Kris: That's why I love it. Nobody's doing it. Right? Especially infills. Mhmm.

Very, very few people. Now it's much more popular than it was a year ago. Mhmm. People are kinda catching on a little bit, but that's okay. First of all, they're easy to find.

You don't even have to drive for dollars. You just Google Maps for dollars. Right? Right. Just go on tax records.

Click. There they are. Yeah. Batch skip trace. Right?

If you go to batch services, cash flow Chris is that code there, of course. But it's easy. We throw them in. We get their info, and we JD, my business partner, normally just door knocks. Yeah.

We find their actual house.

Steve: Mhmm.

Kris: And most of these people have been sitting on these lots for decades. Yeah. And so it's not hard to buy them and as long as it meets our our valuations. So on a lot, you don't wanna be in the lot for more than 20% of

Steve: ARV. So you mentioned, you got all these different developments going on.

Kris: Yeah.

Steve: So how many developments? You said you got Got seven. 1,000,000?

Kris: Yeah. The entire pipeline is, like, 24,000,000. We have 17 single families, like, just infill stuff. And then we have the 24 lot subdivision. That'll sell for around 13,000,000.

And then the, apartment will be the 60 unit will be worth around 9,000,000. And then we're also building a eight unit.

Steve: Where are you building the apartment at?

Kris: The 60. 32nd Street in Southern.

Steve: Very cool. Very cool. And, guys, you know, don't be afraid to ask questions. If you guys like something, you know, tag a friend or, give me a thumbs up.

Kris: Yeah. Definitely, guys. Interactive. I love asking questions. And then, also, you can definitely, cash flow Chris, Chris with a k.

That's why I did cash flow Chris. Chris on Devereaux. Nobody knows how to spell either one. So, yeah, cash flow Chris. Chris with a k.

I'm on Facebook, Instagram, and YouTube. So So I try to, try to share as much as possible.

Steve: Jesse Burrow wants to know how many homes you're trying to build in 2020?

Kris: 2020. We originally had a a goal to do 36.

Steve: Mhmm.

Kris: But that '24 kinda blew that out of the water. So we already have 41 in the works. So I imagine we can get a 100 in the pipeline because we wanted now. We're like, well, if we can do 24 at a time, why don't we just start doing subdivisions? So Jesse and them are finding us land.

And, I we made a post the other day that we're looking for land, and we literally have, like, seven or eight opportunities that we're looking at now.

Steve: What are the challenges right now? Right? Like, you are able to develop, build, whatever, one house, two houses. There's gotta be some sort of next hurdle or Right. One or two major obstacles to go from building one house to building subdivision.

Kris: Well, the main thing that we didn't wanna do is manage. Because I've always been a, I do it myself. I manage my crew. I do it for as cheap as possible. And I, oh, man.

There was, I remember one day, I had nine receipts from Home Depot on the same day. I got in Home Depot nine times. I was just, I was the runner. I was the runner. I was the lowest guy on the totem pole.

So we started just hiring GCs. Yeah. And that's our that's our biggest thing is to find GCs, a, to come in at price. Mhmm. And then, b, who will can really manage the project with handful of guys.

Now you ask, how do we ramp up to the subdivision? Dude, that's gonna be way easier. Because imagine you're a a general contractor, and I say, hey, you know, will you build this house, this one house? Okay. Will you build these 24 houses?

Yeah. You're gonna do it. You're gonna give me a great price for it too. Right. You know, now once we get that, it flips to where, well, now they're coming to us.

Mhmm. We put it out there. Hey, we've got 24 houses of subdivision to build. Bring us your bids. You know, here's our floor plans.

Bring us your bids. Not please build a house for me. Right. Please come in for under a $100 a foot. No.

Like, here's where we are. Do you want an $8,000,000 project this year?

Steve: So how many dollars a foot are you for 24 properties?

Kris: So a lot of people don't understand. They think when you say how much it is per foot, that's how much it is for everything. So just keep in mind, we're we're looking to be at $90 a foot for the build, but that includes the house. It doesn't include block walls. It doesn't include landscaping.

You know, so there's

Steve: Right.

Kris: A few other things involved. It obviously doesn't include land. Somebody the other day is like, they thought it included land. Mhmm. No.

That's just the cost of the house.

Steve: That'd be incredible.

Kris: So, yeah, 90 under under a $100 a foot. If you if a homeowner calls a GC, they're gonna have it'd be a minimum 130, 140 a foot.

Steve: Yeah. So say at least 120. So you're well below.

Kris: Have to be.

Steve: Annie wants to know what's the name of that South Mountain community?

Kris: To be determined. We don't have a name, actually. We're considering some sort of community, I don't know. We wanna put it out there to the community to find out what it's gonna be called. It's on Olney.

I don't know if that's a pretty enough word to be the subdivision, but it's up on the mountain. Beautiful city views, mountain views. Yeah. It's gonna be awesome. It's it's gonna be real real cool experience.

Steve: Alright.

Kris: Annie, I need a name. That's your job.

Steve: She's great. She's, she's the the troublemaker for sure, but she's great. So what does your day look like, you know, with with with all these things you got going on?

Kris: What does my day look like? Well, I definitely do my best to time block as much as I can. My weeks always start off Monday morning, 6AM, with my accountability group.

Steve: Mhmm. I've

Kris: been doing that for three years now, and that's been another reason why my life has really changed. Having an accountability part group is vital. Mhmm. Running an accountability group makes you even more accountability. You

Steve: can't sleep well.

Kris: I can't. I've missed in the last two years, I probably missed, like, four times.

Steve: Yeah.

Kris: Two of those because I was sick, two of them because I literally didn't have Wi Fi or whatever at being out of town. But Yeah. So I have my living your best year ever journal. Mhmm. And, so my Monday mornings start with that.

I review that with my people, tell them what went good, what went bad. Every night I end, writing out a daily gratitude. I want my goal is to do it every single every single day. Day. Daily gratitude.

If you don't have if you can't find the little things in life, you know, it's hard to, hard to expand. And then, yeah, and then I just have my week sectioned out. Wednesdays are our cash flow days. Thursdays are Thursdays, are when we meet with Annie and them, and we go over our subdivisions. And then other than that, I just I try to time block to make sure I get everything in, because there's a lot.

Steve: Well, I love with how much intentionality. Right? I mean, to where you're planning out your weeks ahead of time. And the gratitude piece, you know, my daughters have been complaining a lot. The oldest one, really.

And so I was like, look, we're buying gratitude journals. Beautiful. You get to pick which gratitude journal you're gonna use. But you're using a gratitude journal. I can't deal with all this, complaining nonsense.

Kris: Yeah. And then, yeah. Doing this with our kids is so vital, man. Yeah. I mean, teaching my kids how to do affirmations, meditating with my kids, I don't do it as much as I need to.

Steve: To.

Kris: I wanna make it a nightly thing, and that's that's on me because they're they're cool with it. They like it. But imagine imagine you're a stressed out little 12 year old, and at night you do a five minute breathing routine. Right? They're always so relaxed.

And then, you know, what are you grateful for? What, you know, and then affirmations. Right. You know, empowering them, letting them know. That's the funnest part.

They're great people.

Steve: The funnest part for me is doing is is sharing what's working for us. Right? For them, they got an incredible head start. So you started in 2004. I did.

Alright? I started in 2007. So I got got to enjoy none of the the run out. You've experienced this cycle before. Yeah.

What is your plan for when we have the next cycle?

Kris: When we have. Absolutely. It keeps being pushed back. I don't know why we haven't already. It's really,

Steve: Man, there was that article a couple days ago. They're talking about getting rid of debt to income ratios. Right. One more time. We don't need to stimulate this housing market anymore.

We're good.

Kris: Yeah. You know, it just seems like we're gonna be in a lot of trouble because our interest rates

Steve: are so low. There's really nowhere to go. Yeah. You can't do anything to stimulate anywhere. Like, just

Kris: stop stimulating. Yeah. So as a developer, someone who's kind of always looking a year out, November worries me a little bit. You know, I'll be honest. Of course.

Things could change. Fast. Fast. I don't see what I saw last time.

Steve: Mhmm.

Kris: Right? All these houses that we flipped over the years, when you look at what their payment was, you know, they have a payment of $700, $800, where the same house will rent for $1,200. Mhmm. Back then, you saw when I would do these REOs, you would look. They would have this crazy mortgage, and then they would have a HELOC, $100.

All these people were buying boats, vacations, all this crazy stuff.

Steve: You know, one of my regrets

Kris: Mhmm.

Steve: We're cleaning out this house. Those it was a bank property. I bought it with one of my clients. Third transaction or third real estate transaction I ever did. And the guy that got foreclosed on was a loan officer for Countrywide.

Kris: Oh, Countrywide. They made so much money back then.

Steve: And I like I said, this is like my one of my very few regrets because I saw the underwriting guidelines, and we threw it out. And underwriting guidelines was that

Kris: Not one, though. That's ridiculous. He hasn't

Steve: learned his lesson yet. He's gotta be at least two days. Panipoles.

Kris: Yeah. He's gotta be alive. Unbelievable. Yeah.

Steve: So, yeah, you don't see anything changing right now. So you're

Kris: just sharing that. That money was more expensive. It was actually a lot more expensive. Right? It was all 6% money.

If you're getting HELOCs, stuff like that, lines of credit, you're talking 8% money, seven. And so people didn't have affordable houses back then. I was a perfect example. Foreclosure, right here. Right?

I let it go because, first of all, I wasn't making a lot of money, but my house was worth When it went into foreclosure, I owed 300,000, and it sold

Steve: for

Kris: $1.18. Mhmm. But that wasn't the problem. It was the $1,900 a month payment Mhmm. When I could go rent a house next door for 1,000.

Steve: Yeah.

Kris: And that's what we did. Did. We downsized. We reduced expenses, got dumped that debt. I mean, that was in '11, so we're nine years later.

It's still only worth, like, $2.60.

Steve: Mhmm.

Kris: So, yeah, we let that go. Affordability is always key. So that's why I don't think you're not gonna stop paying on your $800 a month payment to move into a $1,200 rental.

Steve: Right.

Kris: And when we look at foreclosure statistics, foreclosure rate, which is I'm not a mess. So so is it gonna happen the way it did happen?

Steve: It won't happen the same

Kris: way it did happen. It's gonna happen another way.

Steve: Yeah. And Yeah. You made a great post. You know, I've been harping on this for quite some time. But 270 people moving here every single day.

Wow. Positive. Positive migration. 270 people every single day. Every day?

So what is your

Kris: why? What is my why? Man, I just read a a few months ago. I read this great book. I'm sure you've heard about it.

It's called The Alchemist.

Steve: You know, that's on my list. I haven't read that one yet.

Kris: It was great. And kind of the premise is, are you living your personal legend? That's what they call it. Your personal legend. And that's what my talk on Miami was kind of about.

Complacency, man. It's it's no good. We only get one one chance at this. And so my why kinda goes back to the very beginning, that car accident. Like, my friend died in that car accident.

So I have two two lives to live. You know? Mhmm. I was I was in that that bed. Man, I thought I should have died.

Yeah. And so I'm like, I'm not happy with my life. And so I I made a conscious decision that I'm just gonna go all out. I find the woman, you know, that I wanted and Mhmm. Found the career and, man, awesome.

So I wanna live my personal legend. I wanna be the best that I could be.

Steve: Yeah. That's powerful. You know, we only get one opportunity, and we don't recognize it. So, you know, it sucks to have that car accident. Yeah.

But it's also a blessing.

Kris: Changed my life. Yeah. I don't know where I'd be, you know, because everything kinda lined up. Mhmm. You know?

If I never came back from Portland, I wouldn't be married with to my wife. I wouldn't have my kids. Right. I wouldn't have my career. So

Steve: Yeah. No. That's that's that's huge. Family first with the Campbells. They wanna know what's a good ZIP code in Cleveland for for what you're looking for?

Kris: We buy 44109, 4412O, 44105. Those are and 44113. We try to. Those are that's where we buy our fourplexes because that's the West Side. That's the gentrification part of town.

Things are turning over there.

Steve: So we love that one. Stacy says David, Ethan, and Levi say, hey. Aw. My family. Gerald Rojas says, seems like developing at the peak of the market is risky business.

How do you analyze developing deals?

Kris: Maybe, possibly, but we focus mainly on starter homes. So I don't build anything million bucks.

Steve: Mhmm.

Kris: Those houses on the mountain, they're gonna be $6.50 and under, which is a steal. Mhmm. So if we had to convert to rentals, that's most of them would still cash flow. So we build a lot of starters, like $2.35 to $2.80 is what we'd sell them for. So we're gonna be all in those for $1.50, $1.80.

Steve: Yeah. I think that's huge. Right? Strategically, is you always wanna be at around median. Below it if you can.

Yeah. But at median price, and for you guys who don't know, like, in Phoenix, median is 285,000.

Kris: Hey. I don't have to list our properties for sale. Yeah. We sell all of them on our own. Right.

I have another agent that I use, so we have, you know, we can split it off. So I don't have that dual agency. But I list them on MLS and pinned them immediately. So it's it's pretty easy right now. But, yeah, he's absolutely right.

It is a risk, but it's a risk I'm willing to take. We have still a minimum 500,000 too few homes.

Steve: Right. We

Kris: were just at the builder's show in Vegas last week. I mean, we can't. None of us can build them fast enough.

Steve: We can't. We can't. And that's the one of the things that, they're talking about is we're expecting, anticipating double digit appreciation in 2020, which is maddening. Alright? But there's just not enough houses with how many people that are moving here.

That's nuts. Yeah. What's your biggest struggle right now?

Kris: My biggest struggle? Probably raising money. That's one of my one of my biggest, chores is deals are kinda just flowing, especially when you get up to the development world because there's very little competition. Man, you get a off market development deal sent to you, like, there's nobody else looking at it. So that's pretty sweet.

So, yeah, just finding bigger money.

Steve: So how are you solving that problem?

Kris: Networking. I I call. That that's my main call list. Mhmm. We do a lot of social media.

We kind of put it out there. Anybody who raises their hand with interest, we're always constantly rolling out. What's your message

Steve: to stay out of trouble on social media?

Kris: Well, I don't pool money. Mhmm. So maybe I'm wrong, but I'm selling an asset. Like when we do notes in Cleveland, we put it out there, 12% interest for a year, because that's the terms of the note. That's literally what it is.

It's not Right.

Steve: You're not promising a return. Yeah.

Kris: You're not promising anything. You're you're buying an asset. Yeah. It's the same as buying a house.

Steve: Right.

Kris: So that's how we stay out of trouble there. If we do pull money, which we have, we just it's just all below the the scene, you know, behind the scenes. And then, obviously, you have to have a lawyer involved, have a have that. But, yeah, we're usually just doing notes.

Steve: For someone right now that wants to get into developing, right? They've been wholesaling for a while. Like, man, I'm ready to start It's full. Sorry. Outside of Phoenix.

They're not in Phoenix. So they're ready to start developing. What advice would you give them in their market on how to build out, to get funding? Okay. So first, before

Kris: you're worried about funding, I want to make sure how viable building is in my community. You need to find out what can you build per foot. You know, get with your GCs. You know, really find out. Try to not narrow that down.

Find out how much you can you're gonna have to pay for land. Some places it's cheap. Some places it's expensive for no reason. And then what's your what can you sell it for? You know, we're selling for 180, dollars 190, dollars 200 a foot.

That allows us to to make the math equation work. You know, real estate investing is a math equation. As long as you got the what it's worth done right and what it costs to do right, you can you can do that right. So, first of all, make sure it's a viable option, and then find other builders in your network. Find you know, take them out to to lunch, whatever, and pick their brain, and go at them as, hey.

I've been running across some lots. You know, what are you looking for? What are you building? And then wholesale, and then watch. Mhmm.

But then with the raising money, they go it's pretty similar to fix and flips. You can either finance the gap in the back with the second mortgage or, you know, borrow a little bit more upfront and do the first mortgage.

Steve: But as far as finding the guys with the money, how would you recommend they find the guys with the money?

Kris: Beneficiary list is has always been good for me. I mean, again, for me, I I hate to all it's always network, network, network. But it's true.

Steve: Yeah.

Kris: We were talking about earlier, I'm a real estate agent, and my best investors are realtors. Realtors. Mhmm. They are sold on real estate. Right?

They believe in it. They sell it. But they don't necessarily wanna do it themselves. So I I talk to everybody I know about it. And but here's the conversation.

So, Steve, you know, oh, man. Here's what we're doing. Boom. It looks like this, this, this, this, this. Do you know anybody who would be interested in investing in a type of deal?

You know, our investors are getting this, this, and this. Like, do you know anybody? I would never ask you for money. Right? Because that just makes it weird.

But do you know anybody? So maybe you know somebody, but if it's you, you're gonna be like, woah. I know me. Yeah. Let's go.

Right? So talk, talk, talk, talk, talk, talk. Everybody that you know in your world needs to know about it. And then you probably need to start hanging out with people who aren't in your world, because Doctor. Darrell Bock In

Steve: the circle.

Kris: Doctor. Darrell Bock Yeah. I mean, most people are like, Oh, I don't know anybody with money. Oh, well, go meet new people. Doctor.

Steve: Darrell Bock Yeah. Make new friends.

Kris: Doctor. Darrell Bock Absolutely. Doctor.

Steve: What is your superpower?

Kris: Oh, man. I knew this was coming too. I should have thought about it. I think vision and, you know, having the faith in putting a deal together, whether, you know, it's the fix and flips to the developments, you know, just kinda seeing that seeing that vision and then and then believing in myself that I can make it happen. Because entrepreneurship is a lot of, you know, jumping off the cliff and figuring it out on the way down.

And if you don't jump, it's never gonna happen.

Steve: Right. Yeah. I tried to I was trying to find like, a GIF or something from the Lego movie of them jumping off something and building a plane.

Kris: Building a plane? Oh, man.

Steve: That's a good one. That's how I view our world. Right? It's like, I don't know. I'm gonna jump off this cliff, and I'm gonna figure it out.

Kris: And that's the difference between the people who are extremely successful and those that aren't. They're not willing to take the leap. Yeah. Got it.

Steve: What is the greatest lesson you have learned?

Kris: In business, in real estate, get into cash flow as soon as you can. Wholesaling and flipping is a transactional business. Once you make your money, yeah, it's good money. You got to go find another deal, another deal. So, let's just say we're gonna, you know, 130 units.

I mean, it's a lot. Once we're fully going, that should be, I don't know, 70,000, 80,000 a month. You know, of course, you have a lot of expenses, so I'm not, But just think about that. I don't have to go find that again. Right?

You can make a $70,000 on a flip. Mhmm. But I'm gonna make it every month, every year, every year. Clockwork. Every year.

Yeah. I mean, flip for cash, hold for wealth. Every every week, I get all my properties, I list on Zillow originally. Right? So I'm still the owner.

So Zillow is always anytime there's an update, they send me, here's what it's worth. And on Instagram, I'll always post, boom. We sold this for this much, and now it's worth this much. Right? So hold, hold, hold as much as you can.

Find a way. Right now, money is so cheap. Money is free right now. If you have the ability to get a loan and you have some cash, go buy some cash flow.

Steve: Mhmm.

Kris: Because, I mean, the money is so super, super cheap. And then, I always teach to throw it on the fifteen year. You always gotta buy with equity. You always gotta buy with cash for cash flow. But throw it on a fifteen year, and by the time you're in your forties, fifties, you will be very happy with yourself.

Steve: Makes a lot of sense. Sam wants to know, what is your contact info?

Kris: Cashflow Chris on all platforms. That's the easiest way. Send me a send me a message. Instagram's probably a little bit easier. Messenger kinds, you know, doesn't let everybody through.

Steve: So How, how can Andrew wants to know how could she get that shirt?

Kris: Google it. I bought it online. I don't know. I should start selling it. Right?

Steve: You should. You should. So what is your favorite, best, or most interesting failure?

Kris: Man, there's been a lot. You know, at the end of my flipping, I I just I bought too many bad deals. And I put myself in a in in some bad situations with lenders, and, you know, I lost a a few lenders because and it wasn't necessarily because they didn't get paid. You know, all people have always been paid, and that that always kind of perplexed me a little bit. It's like, you made 15%.

You you know, you made this. What's what's the problem? Well, the problem is I didn't live up to what I said I was gonna do. Mhmm. And, you know, I said I was gonna pay you off at this date.

And while, yeah, you got a great return, you know, you I didn't live up to what I said. So Yeah. So breaking promises, which is never intentional, that's always been a been a tough one for me. Yeah. I'm still actually dealing.

I got two more bad deals that I'm trying to get through. But luckily, we're in a highly appreciating market. Yeah. So it will happen.

Steve: Is there one book that you've gifted more than any other?

Kris: Rich Dad Poor Dad. 100%. And then, no. I'll have to take that back. Living Your Best Year Ever Journal.

Yeah. Unfortunately, it's out of print now. Darren Hardy doesn't do that anymore. But if you can He doesn't? No.

He does something different. He that's out of a journal. It's a book. The first part is a book, and then the second part, you evaluate your year. And, my wheel I I always put my wheel, you know, because it's a you mark where you're at on all phases of your life, financial, family, business, you know, physical, spiritual.

You wanna be a 10 on everything. You want a nice big wheel. Right. That's not, you know. We have crooked wheels.

We're good here.

Steve: We're we're bad there. Non functional wheels.

Kris: Yeah. So the goal is to always be improving.

Steve: Mhmm.

Kris: But, yeah, definitely. Rich Dad Poor Dad is fundamental. And then and if you wanna grow,

Steve: I gotta have a journal. David Davila's got an interesting question here.

Kris: What's up, David?

Steve: How much is the most you would ever pay for a watch?

Kris: I think, this might be coming from a little, meme that we were talking about. It says cash flow, Chris, don't buy Rolex because Rolex don't cash flow. I don't know, man. I don't I got my Propecclio. I got my Secret Narc.

I don't know. I don't really wear watches.

Steve: So Yeah.

Kris: I don't know. 10,000 thousand to give as a gift. How about that?

Steve: There you go.

Kris: Hey. But a good friend of mine told me that, Rolexes survived him through the downturn. You know? He he got he kinda lost everything, and, he didn't sell his Rolies, and they kept their and, he didn't sell his Rolleys, and they kept their value. You know, he's able to cash in, and that kept him going during the downturn.

So maybe I'm they don't cash flow, but they hold their value. Yeah.

Steve: Alright. So, I'm gonna make a few quick announcements, thinking about what you wanna leave the listeners with. Yes. Guys, so, you know, Max and I, we got a lot of really good reviews, from our last workshop. So if you guys wanna check it out, go to disruptors.com, where our next one's gonna be in April.

It's two and a half a day event. We go over everything in our business, what's making our business tick. So if you're interested in checking that out, go to disruptors.com. And next week, we got Leon Johnson, who is, you know, is a very fascinating guy. He's doing what you're doing, or he did what you're doing.

Mhmm. And he's living a pretty good life right now, because he started started doing creative financing in 1978. Oh. Before I was even born. Yeah.

Kris: That was my year.

Steve: Yeah. So, it's it's been an interesting show. Lots of, really, you know, lots of wisdom in the few times I've spoken with him. So, last thoughts.

Kris: So for all the real estate investors out there, I would say, you know, I'll keep to my mantra, flip for cash. You know? Flipping's great. Wholesaling's great. You make good money, but you gotta start holding for wealth.

Mhmm. You know? Get that cash flow in your life. It's gonna be consistency, and it's gonna really when we have that downturn, it's gonna make people a lot a lot more comfortable. And then on the personal side, yeah, man, I would say find a journal.

Start start actively participating in your life. Jesse Itzler I don't know if you know Jesse Itzler, two great books, he wrote. He breaks it down to, We don't know how many times we have left. An example of his is, my wife my parents are 75. The average expectancy is 80, let's just say.

So they have five more years left if everything goes right.

Steve: Mhmm.

Kris: And I see my parents five times a year. That means I'm gonna see my parents 25 times more in their lifetime.

Steve: It's a different perspective.

Kris: Right? My grandma lives here in the Phoenix area. Right? My my sisters live here, but I don't see them as much as I can, so I started being intentional. My sis I had lunch with my sisters yesterday.

I may or may not see them again this month, but I'm gonna see them at least one time every month. We calendar it. My parents, I put them on the calendar. And so being intentional with your life, it's easy to go a whole year without doing some things. So putting things on your calendar, the most important things in your life, and which includes vacations, which includes lots of things.

Right. You know? So, yeah, being intentional because every year goes by faster because every year is a smaller percentage of your life than the year before. Yeah. So it's not a coincidence that every year just you know, when you get older, time flies.

Yeah. You know? That that's how life is. So yeah, man. Just live your personal legend.

Steve: And I wanna add just one one one part to that, you know? Something that Darren Hardy's a big I'm a big, I'm a big fan. He talks about, you know, what will happen to your life if you stop tracking everyone else's statistics and just start tracking your own personal statistics. Right. And that's what you're doing.

Right? You're tracking how many times you're having, seeing your sisters, seeing your parents, seeing your grandparents Yeah. Vacation

Kris: days. Hey. Check this. You're you're a dad. So kids are pretty much worthless till they're four, and then they're gone when they're 18.

Yeah. You have 14 summers with your daughters.

Steve: Yeah.

Kris: Think about that. So are you just gonna, we're not gonna do anything. I'm too busy. I gotta work.

Steve: Mhmm.

Kris: You know? Or are you gonna take them on an epic twenty two day vacation? Like, that's what I decided. This year, we're we're researching going on to Scandinavia right now. And maybe, yeah, maybe people don't have the money or whatever, but still, set some time aside.

Put Doesn't have to

Steve: be in the kitchen.

Kris: Calendar. Yeah. It could be San Diego. It could be whatever. Yeah.

A staycation. Spend time with your people because before you know it, I mean, fourteen summers.

Steve: Mhmm.

Kris: That sucks. My kid's 12. That means I got six more summers. So this one is gonna be amazing. And the next five after that are gonna be simply amazing because that's all we get.

Steve: And actually being present on the vacation.

Kris: Oh, yeah. Turn that stuff off. Yeah. Absolutely.

Steve: Awesome. Very cool. Thank you guys for watching. Appreciate it. Thank you.

Thanks for the time. Awesome.