What Real Estate Agents And Investors Get Wrong

Steve Trang: Hi, Steve. Jump on the Steve train. We real estate disruptors.

Steve: Hey, everybody. Thank you for joining us for today's episode of real estate disruptors. Today, we've got my good buddy, Mark Dela Torre with SBD Housing. Mark flew in from Kansas City to talk about what realtors and wholesalers get wrong. And he's probably really excited to be here this particular week at the Super Bowl.

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Let's do it. Alright. So, let's just real quick. I know you've been on the show before, but just for everyone that's listening and hearing your story for the first time, what was your life like before real estate?

Mark Dela Torre: Boy, I was talking to one of your, employees earlier, and, he chuckled when I told him I've been in real estate for about twenty one years because, he said, man, that's about as old as I am.

Steve: Excuse me. He's not lying.

Mark: No. Life before real estate was college. I mean, I came straight out of college and got stuck into into real estate, flipped a house, at a very young age and just kind of fell in love at first flip. So, life for me was college and tennis and and golf and hanging out.

Steve: So right into real estate, you didn't go get a degree to get a job and do the

Mark: You know, the so university for me looked a lot like, didn't know what I wanted to do. I had the entrepreneurial flare. I knew I wanted to get into, business for sure. Was certainly realizing at a young age. Well, once I got into college that there was no way I was gonna turn pro in tennis.

I was good enough to play division one, and that, obviously afforded me the luxury of getting my education paid for. But, I stayed on, got my MBA, and then, had been working and dabbling with, my father-in-law actually on an advertising venture at the time, putting advertising inside commercial aircraft.

Steve: Mhmm.

Mark: But then September 11 hit, and, clearly, airlines were, very leery of any new forms of advertising. So at that time, I'd, yeah, flipped one house and and got going.

Steve: Alright. So you like that first taste and you kept going?

Mark: Yeah. I just never, I think I was young enough and and, you know, when you have no overhead and and, you know, a supportive, fiance at the time that said, you know, go do whatever you wanna do. I was just not really wanting to go sit behind a desk and work for someone else.

Steve: Mhmm.

Mark: What's the definition of an entrepreneur? Someone that will be willing to work eighty hours for themselves so they don't have to work forty hours for someone else. Yeah. That's kind of my that's definitely me in a nutshell.

Steve: Well, that's absolutely right. So, who helped you along the way? Right? I mean, going from your first house, I'm sure there are a few mistakes along the way. Who helped you in your journey to get where you are today?

Mark: Oh, goodness. So many people. I think it starts with having, supportive parents. So that was third land. My siblings are always just, yep.

Go do whatever you wanna do. I mean, keep in mind, I flew halfway around the world. It it's really coming full circle for me now because I have a a young son, 16 years old, who's looking at going off to college, and I'm suddenly having flashbacks when I was his age thinking I might wanna fly halfway around the world to go to university in America be having been born and raised in New Zealand. So, yeah, it's really come full circle, and I'm, appreciative of the support that my parents gave me.

Steve: Mhmm.

Mark: Having said that, I'm I'm a voracious reader. I love to read books. I think most of my mentors, I don't know personally. But for sure, Rich Dad Poor Dad. I know it's cliche, but that really altered my perception of real estate.

And although I tried to, you know, get into stocks and and the stock market, just never made sense to me. So I've always been a real estate guy and just started reading all up on the real estate from a young age.

Steve: You know, you mentioned, Rich Dad Poor Dad. So, like, I kinda made this joke to someone the other day. So it it I think, like, this path that we go through is, like, it's it's Kiyosaki. Mhmm. And then at some point along the way, you find Sean Terry on a podcast.

And then somewhere along the way, like, you're successful. Like, there's, like, these two steps that a lot of people go through. And so what were some of your biggest victories? Right? Twenty one years is a large body of work.

Yeah. What are some of your biggest victories?

Mark: So I was a courthouse steps junkie. So, I answered an ad in a newspaper, which some of your readers may not understand what that is, but it's this former medium that used to pick

Steve: up and look at. It's like, some paper is black and white. Yeah.

Mark: So, yeah, there was an article in there, and it's in the Kansas City Star, and it said, come learn how to buy foreclosure properties. And so I answered the, you know, free. Right? So it was a a lead in, and I went there and then went down to Springfield, Missouri. A guy who used to be in the education space is no longer there, but a guy by the name of Larry Holder.

And he taught me just how to buy houses on the courthouse steps. You know, there were 50 people in the room at that time, Steve, and I'm curious now to see who kinda made a profession of it. I'm guessing not many. Mhmm. But, yeah, it went down and learned that and came back and kind of fell into this niche where I was very fortunate that this is back in the day where in Kansas City, at least, we only had, like, two or three people on the courthouse steps.

So that's where I, you know, crushed it was buying hugely undervalued properties at $20.30 cents on the dollar for, you know, a long period of time. And it was very hard to go wrong when you're buying that that just that much of a discounted properties. I always say time heals all wounds in real estate, but also if you can buy cheap enough, the the mistakes you can clunk along. There there are never, you know, few holes in the boat. You can just plug them.

It's never the devastating blow that sinks your ship. So I was very fortunate to go along that. But some of the biggest wins, you know, I bought an apartment complex for $10,000 and and sold it for 650. I mean, that was, you know

Steve: That's a pretty good win.

Mark: Kind of a big win. And, but, yeah, I've had my ups and downs. I mean, there have been, some, you know, devastations along the way. I had a had a bit of business divorce that that taught me a lesson.

Steve: Mhmm.

Mark: You know, kind of millionaire by the time you're 30 and then crushed back down to nothing and then have to build back up again. So Yeah.

Steve: You know, there's ebbs and flows in anyone's career. So let's talk about buying an apartment complex for $10,000. I'm I'm guessing this is a courthouse step situation. Yeah.

Mark: And it was just a random one where most of the attorneys in town, were advertising in two form, the daily record and the pulse. These two legal publications that they were required. They're not required that they used to advertise all of their sales.

Steve: Mhmm.

Mark: It just so happened that this one attorney did not use that medium, and it happened to be my attorney that I was using for estate planning.

Steve: Mhmm.

Mark: And she said, hey. By the way, I've got this auction coming up, and and, you know, there's not much owed on it, but, I'm gonna cry the sale. And they were required to announce where it was going to be, but it didn't have to be at a student in any one location, just a public venue.

Steve: Mhmm.

Mark: And so she just did it at her office out on in front in the parking lot, and I was the only one there. She opened the bidding at $10,000, and it obviously need a little bit of work. But, yeah, I mean, I I held it for a long time. It was actually a catalyst for my venture down to Florida because I immediately went bought it for 10,000, on October 30. So two days later, I went to collect rent and got, $5,000 in rent from all of the it was a 12 unit apartment complex.

So went and got all the rent, from all the people and then turned around and and went to the bank and said, hey. I've got this asset. Can you do an appraisal? I think it appraised at the time at, like, 300.

Steve: Mhmm.

Mark: So I immediately pulled out 250,000 online to credit and start buying other properties. So real estate just just cycles like that. If you have equity, you can you can capitalize. Now I sold it years and years and years later. I think I held it for about a decade, so that's why I'd appreciate it up to, 650.

But, yeah, I ended up exiting from that one, and it was it was a great deal.

Steve: But even if you buy a $300,000 asset for 10,000, can't really lose. Can't lose. Yeah. And you said there was a business divorce. Yeah.

What was the business divorce, and then what were the lessons you learned?

Mark: I learned, so the business I I was flipping houses on my own and had someone come to me and say, hey. Why are you not doing more? These deals on the courthouse steps seem crazy. Mhmm. And I said, yeah.

Well, I mean, it's money. You've gotta have cash on the day. Cash on the barrel head as they used to say.

Steve: Cash on the barrel head? That's what they

Mark: used to the auction, you gotta have cash on the barrel head.

Steve: And, I've not heard that expression before.

Mark: So you've literally got a pony up same day in wire money or sometimes bring it in certified funds. So, you know, unlimited capital was a way for me to scale that operation. So two business partners came on with me. They were the silent, quote, unquote, business partners, and, I was the operations guy. And we had a good run for about seven years, but when the market turned in 2008 and things started getting tight, where we could have pivoted a different direction and gone our separate ways, we owned about a 120 doors at the time, a large portion of those completely paid off.

I learned very quickly that if you own a third of a business and the other two business partners wanna gang up on you,

Steve: a hostile

Mark: a hostile takeover is a very real thing. And so, yeah, that was it was a painful lesson because I was just pushed out. But everything happens for a reason, and I've I grew through that. It was very painful.

Steve: You know? I can imagine.

Mark: Tears and and trying to explain to you why why you no longer have a job or a business and and and starting all over again. But everything happens for reason, and I was I grew through that and have maintained a 100% control of my companies since that time and and, you know, was was all the better for it.

Steve: Yeah. You know, I think, there are some challenges along the way, right, when you're building a business. Actually, Paul Sparks and we did an episode last Friday talking about, like, the importance of structuring a partnership the right way, setting that right expectations, but also how you should in very, very few exceptions, never do a fifty fifty partnership.

Mark: Right. Someone has to have decisional decision making for authority. Absolutely. Yeah. Yeah.

Steve: So, let's see here. So you have sent me a video, and I I I love the idea. You said, Steve, on the show, we should talk about what realtors and wholesalers get wrong. So, obviously, you've done well, particularly in Kansas City. So let's talk about this concept.

What is it that realtors and investors generally get wrong?

Mark: So here's a great example. We already talked about that apartment complex. Okay? So let's just say I bought it for 10,000 and immediately wanted to sell it. And let's just argue you know, for instance, I could have sold it for 300,000 at a price value at the time.

Steve: You might wanna wholesale it for, like, $1.40 or something like that.

Mark: Alright? So sure. Let let so let's say I buy it for 10, sell for third, and it would have been a $290,000 gain. I would have paid tax on that. You're giving up $90,000 right off the bat to the government.

Now you've got $200, and and then you've gotta go invest that and try and repeat the cycle. Mhmm. The difference is I was able to get the $250,000 in a line of credit. And because you're borrowing that money, you can then turn around and invest it. You pay nothing in tax.

In fact, it's a tax benefit because you can depreciate. Although, on $10,000, you're not depreciating much. But the idea is with any investment, you can depreciate and get a paper loss.

Steve: Mhmm.

Mark: And at the same time, turn around leverage and go buy other assets. The accumulation of assets is the key to wealth long term. And in a nutshell, I believe that both real estate agents and real estate investors transact more than just buy and hold.

Steve: Right.

Mark: And the greatest mistake that I believe they're making is that they should be holding more assets. The wealth that I have created in my lifetime is not from transacting. It's just from buying and holding, and then just, you know, down the road, these assets double in value.

Steve: So we're to Divya Marks wealth. A 100% of it. How much of that wealth came from active income? How much of that wealth came from buying properties?

Mark: Okay. You've gotta be careful there because, obviously, your active income, if you're smart, you'll pour into, you know, buying more assets. Correct. But as it sits right now, I would say that, you know, 80% of my wealth is just from assets that I have bought and held and appreciated in value.

Steve: Right.

Mark: I would say probably 50% of my wealth is just pure appreciation. Mhmm. Because I've, you know, bought assets for the last twenty years. Yeah. It's it's I mean, real estate in any market you're in, I would challenge someone to go back and pull MLS comps.

Sometimes I'll be, you know, comping a property for one of my acquisitions agents. It's tough comp. And I'll go back and look at data, and I'd look and see the same house I could have bought that I'm thinking of buying now for 200,000 because it's worth 310. The same house too. I could have bought, you know, ten years ago for 100,000.

Yeah. It's just real estate doubles in value every twenty years.

Steve: So we were driving in Mesa the other day, my wife and I, with the kids. I can't remember exactly where we're going, but we're in Mesa. And as I'm driving, on a left hand side are all these fourplexes that I've shown. As a realtor, I've shown these fourplexes. And they're worth more than, I think, half 1,000,000 today.

I just drive by it, and I just shake my head. It's like, I was showing these when they were, like, 160.

Mark: Yeah.

Steve: Right? Like, we just bought it for $1.60 and just held on to it. We've done pretty well for ourselves. And one sixty was not a lot of money. $1.60 for fourplex.

He came and buy a house today Yeah. Right, for $1.60. So let's just say, hypothetically, we got a good friend, Jason Medley, sitting next to you. Mhmm. Because Jason has said that a lot of times, we try to buy assets for passive income at the risk or the cost of our active income.

You know you know what I'm talking about? Like, the best way to have passive income is to make a lot of active income. It's more or less as expression. You're you're familiar with Sure. Okay.

In this instance, we're talking about you should be buying more assets to buy and hold. Mhmm. So can you help me reconcile that argument?

Mark: Yeah. I mean, clearly, you know, there there's validity to both points. I think he would he's also buying assets.

Steve: Mhmm.

Mark: Right? He chooses to lend money. Mhmm. And he's creating paper assets. I don't think many people have the ability to do what he does.

Not what he does. No. So, it's it's a unique proposition, but he's still creating an asset that that that spits off passive income. Right. 100% agree that you have to have an active income to be able to go buy assets.

Mhmm. I think those that, but but I think that the message I'm trying to get out there is that I'm talking to people that make a lot of money. Mhmm. But they'll go buy a flashy car or a bigger house or take massive vacations rather than you know, I'm I'm not trying to tell someone that's making, you know, $50,000 a year, you know, to start buying houses. I mean, that would be overleveraging.

I just believe that there are very successful people in this world that are oblivious to the great asset that's out there for them to pour money into. And it's so easy for us to put hundreds and hundreds of thousands of dollars into the stock market where it's truly just volatile, and you don't get the benefits of these four pillars of real estate, which is appreciation, the tax benefits through depreciation, the cash flow, and the scale with which you can because of the leverage. So

Steve: and I I love that we're talking about this topic because, I'm in a different mastermind. It's a realtor mastermind in the Phoenix market. Mhmm. And there's this realtor, Paul Pestor, who I look up to. And I wanna say about once every four to six months, I just put his fist on the table, and he's like, you guys need to buy more real estate.

Right? It's like, the greatest mistake that realtors make all the time is that they don't have rental incomes. Like, you guys and he looks around. Right? He's been doing this for forty plus years.

He looks around. It's like, all you guys that I've known for all these years can't stop working. I can do whatever I want whenever I want because I've been picking up real estate all along the way. But for the life of me, I can't figure out why realtors who buy and sell real estate, who suggest on a regular basis, it's a good time or you should buy real estate, who, to this present day, say, you should be buying real estate Yeah. Or not buying real estate.

Mark: Well and and I think part of it, Steve, is that there's an active portion. They feel like they're gonna get bogged down with the management.

Steve: Mhmm.

Mark: And, you know, without dialed in property management, you know, the two big killers of cash flow, obviously, are vacancy and maintenance. If every property was occupied forever and never had any maintenance, everyone would do it. But there is so there's a negative connotation to thinking that they're gonna have to answer phones. But you find the right property manager, and that takes care of itself. I think that realtors, are underestimating the greatest tax benefit the government gives us.

If you're a fully licensed real estate professional, you're allowed to take a 100% of your, you know, paper losses in years. So you would be minimizing the taxes that you're paying to the government through the actual, depreciation you're taking on your assets. And the other thing is people look at an asset and say, oh, it's only cash flowing, you know, a couple of grand a year. And if someone moves out, then that's my whole cash flow gone. They're missing the whole point.

Mhmm. This is not about monthly cash flow now. It's about having cash flow in the future. The biggest misconception I think with regard to real estate is that the monthly cash flow from a piece of real estate is gonna be life changing now. No.

It is not. You're not gonna be able to go and buy real estate and have it change your life. However, you can also not go in retirement and buy a massive portfolio. You have to have had time work for you. Mhmm.

Because you'll leverage the asset and someone else will pay that mortgage off for you. And then in fifteen or twenty years' time when that asset is paid off, then you have that life changing financial freedom

Steve: Right.

Mark: From having a a fully paid off asset that will be will be cash flowing. So that's, I think, the the thing people don't realize is you're not buying it for cash flow today. You're buying it knowing that you will be getting it in the future. It's what delayed gratification is the sign of maturity. I mean, it's the classic, mature play.

Steve: So we had someone on the show, I wanna say, two, three weeks ago, Jason Griggs. Right? And he, he's in the Vegas market. And he, is a is a realtor and young guy or younger than me. So I guess, you know, take that for what it's worth.

And he's got 27 properties in the Vegas market, single family homes that are nearly paid off. Right? And he's been doing this for not that long, less than ten years. Right? And I asked him, like, well, how come you're, like, the only realtor that like, you're one of the very few realtors that's actually doing this?

Like, well, I asked around, and it seemed all my wealthy friends own real estate. I was like, oh, hey. That's a clue. Right? That's a clue we can run with.

And so he's been challenged by even peers in our community. Hey. You should do a cash out refi. You should leverage this so you can buy more assets. And his answer to to that those suggestions was, but I'm making the kind of money I wanna make passively.

I can do what I want whenever I want. I can if I want today, take my wife and kids and just go to another country and not have to worry about a thing.

Mark: Yeah. COVID didn't freak him out.

Steve: COVID didn't freak him out. No. Right? And you don't have you're not accountable to, like, you have have to be careful what you say. You have to be careful what you do.

You just you can live your life exactly on your own terms.

Mark: Yeah. That what we coach our investors so, obviously, we sell turnkey real estate to Yeah. High income, high net worth individuals or people that just wanting to to build their own portfolio. And we tell them the key is that you scale with leverage to get to a number that once paid off would satisfy your monthly passive income that you're trying to get to.

Steve: Mhmm.

Mark: So what I'm saying is, let's say that they wanna get to 20,000 a month from passive real estate. Well, roughly, when assets are paid off in Kansas City, you're gonna bid a thousand dollars per asset, you know, for every every house. So you're therefore and then and since you just scale quickly with levers to try and get to the number 20 houses as soon as possible, And then after that, you keep just chunking down the equity. Don't go turn and round and put more money into the stock market. You start chunking down the equity and have your tenants paid off.

Steve: Mhmm.

Mark: So it's a scale with leverage, power down the debt, and then you reach your freedom number very, very quickly.

Steve: Yeah. And then you touched on something a moment ago that, you know, people may have missed this, is that a cash out refinance is not taxable. So can we just spend a few minutes here and explain what that means?

Mark: I'm happy to share a personal story if that would get story story time. Right? Sure. Story time. You know?

Yeah. When it's more a personal story, you know, that helps. But, I went back and looked at my portfolio in in, 2019 late two thousand nineteen. Just happened to be right before COVID hit. And I was looking at this and thinking, the thing that frustrated me was that I had I'd always just took one mortgage out per asset.

Right? And I had about 60 or 70 assets. And so I was looking them all and doing different valuations, and I called my lender and said, look. Rates were low. Can I just put all of these on one note?

Steve: Mhmm.

Mark: But I didn't really you know, I don't wanna give myself too much credit that I fully knew exactly what I was doing, but I knew if I went on one note, I could suck some money out. All of a sudden, the appraisals came back, and I was like, wow. I mean, the equity that had slowly built up I because you kind of ignore them. Like, the these real estate investments are, you know, just sit there and ignore it because they just they just operate. They perform.

I have my property management team managing them, and and you just forget about them. You just slowly accumulate them over time, and they're just sitting there doing you know, your checks coming in every month. But then you what you don't realize is how much they're appreciating your value. So we had them valued, and there was just this massive multimillion dollar, gain that is just appreciation.

Steve: Mhmm.

Mark: So I was able to set myself up for, you know, at least the protection of a downturn Mhmm. Which ended up happening clearly, where I sucked a lot of money out of my portfolio tax free because it's just borrowed money. I do have to pay that back. Mhmm. But the benefit was that I had the rental income to offset that payment.

So now my tenant's, you know, in debt for millions of dollars, but my tenants are slowly paying that debt off and will be paid off in fifteen years. And I was able to to just hoard some cash and sit on the sidelines because there's a lot of financial strength by having a lot of dry powder in the bank Mhmm. And having paid off all personal assets. And that is a nice place to be.

Steve: Yeah. So just to to illustrate for everyone who's listening. So let's just say, for example, you got a property that's a half million dollars, and let's just say it's, let's just say it's paid off. Right? If you guys were to sell that property, you can get $500,000 cash minus realtor fees, whatever.

Right? $500,000 cash. Whatever profit on that property, you have to pay in taxes. It's taxable income. We're assuming here there's a rental property.

But if it's free and clear, and you'll get a cash out refinance from the bank, let's just call it $300,000. You pull out through that $300,000, that's borrowed money. It's not actual, it's not it's not a cash distribution. It's a refinance. So for everyone who's listening, you're getting $300,000 in your pocket.

You have to service that debt, but it's not profit. It's debt. It's just taking money out of the balance sheet. So, you're just moving 300,000 of equity into your pocket, but you have to service that debt. But because you have to service that debt and it's real debt, it's not income.

Mark: Yeah. And so because you have a tenant that's in there again, you've gotta manage the asset. If your tenant moves out, then, yes, you'll be responsible for the payment. But you know what you can do with $300,000 in that example? Put a little bit in savings account in case the tenant moves out.

Yeah. So there's power in that. And and what you realize is when you scale that and do that, you know, 60 or 70 times versus just once or twice, then, you know, the the numbers get pretty big.

Steve: Yeah. And I've shared with you. Right? Like, I am envious of all of all you folks in the Midwest because this cash out refi thing you guys can do, like, over and over and over and over again. And we're challenging, in the Phoenix market.

Mark: Well, I would challenge you that, in the same way that, you have the benefits of appreciation here and investors can invest here, don't feel like you have to be investing in your own market. Mhmm. You know, through collaboration and partnership and turnkey providers.

Steve: Mhmm.

Mark: You know, we have missus from all over the world that are choosing to invest in Kansas City. Most of them are, you know, California, Florida, Pennsylvania, and that kind of thing, but a lot from Australia, New Zealand, The UK, Germany, I mean, all over the world.

Steve: Well, that's actually one of the things I wanted to execute. I don't know if it's 2023 or 2024, but I wanna be able to create, something within our organization so that everyone that works here can invest, right, in a portfolio. So we can get a portfolio. Right? It's held by the umbrella company, but everyone has the opportunity to invest that works here so that we can truly create wealth Yeah.

I think that organization.

Mark: So that brings to mind, Steve, one of the fallacies that I think happens in the workplace is, you know, when someone signs up, day one at, you know, and they go work for T Mobile or BMW or one of these big corporations, and they sign up. Hey. We do a company dollar match.

Steve: Mhmm.

Mark: Where does that money go? $4.00 1 k. Straight into the stock market. Yeah. Right?

So it's like they're truly just training you from a very young age. Like, let the the way to build for a tie, and then they see the fluctuations. You can't really lever it until it gets to be super sizable. You don't get any tax benefits from it. So it's just you're taking more out less out of your paycheck, and then you're trying to struggle to make ends meet.

Mhmm. But, again, the mature investor is someone that says, I will choose where I put my retirement dollars. Mhmm. So I'll be mature enough to say I've I'll take more money coming into my pocket, put it over here into an account that I'm gonna save up to buy real estate with Mhmm. And then, you know, figure out either either they're gonna partner with someone or actively do it themselves, but, you know, figure out some targeted strategies to actually stop buying and acquiring and holding Mhmm.

Real estate. Yeah.

Steve: Again, that's something I'm passionate about. I wanna help everyone here that works with us to be able to do that.

Mark: Dude, you're saying your your goal is a 100 millionaires. Right? 100 millionaires. Your debt is not hard. If people would seriously just go out there and buy and it's time.

Mhmm. But they just buy and hold assets for a long period of time, and the millions happen. Yeah. It it it cannot not happen.

Steve: No. It's impossible for it to not happen. So you mentioned that realtors are missing out on this opportunity because they're active. Was it active investors? What do you call it?

What's that term? You have to check that box when you when you Real estate professional. Real estate professional. Yep. Can you elaborate on real estate professional?

Mark: Yeah. The IRS gives special designation to, real estate professionals that allow them to take, depreciation Mhmm. 100%. So there are some of our clients that are dentists or doctors or lawyers that are active, and they don't spend x number of hours in real estate profession, they cannot take I think that capped at 25,000 or a certain, percentage of the, paper losses if they were to take depreciation.

Steve: Mhmm.

Mark: Which when you're just doing a single family portfolio is not that big a deal, but when we have investors do on it working on multifamily syndications, and there might be, like, a a 35 or a $100,000, bonus depreciation involved, they cannot get the benefits of that. Really? But with real estate professionals, they could take, you know, a 50 or a $100,000 and invest it in a multifamily syndication and get bonus depreciation where if you put a 100,000 in, you're getting a 2.5 multiple back. So you get to write off $250,000 in the same year that you invested a 100. Mhmm.

There's all kinds of amazing strategies that real estate investors and real estate agents specifically can can that are open to learning about these that they can go play in that space that they're just not utilizing. Yeah.

Steve: And so I see a bunch of you guys are watching here. You know, please fire away your questions because I wanna make sure that, you know, for those of you guys who are watching, obviously, you guys are real estate investors. Make sure, you know, like, take this opportunity to ask, Mark any of these questions because I wanna I want to have confidence, you know, the, that you guys have the tools and ability to go out and execute this. Right? Like, it's you were saying, right, we're on a mission to create a 100 millionaires.

Mhmm.

Mark: The best

Steve: way to create millionaires is for you guys to actually buy and hold real estate. We talk about a lot on the show, on this channel, about how to create active income, but active income is not directly correlated. It's highly correlated. It was not directly correlated with creating wealth. You gotta eventually buy properties to create wealth.

Mark: You know, I'm sitting here with, you know, gray hair, appearing from the last time I was here, mate. And the one thing that I you said that you had talked about the guy in the room that was talking to you. One thing that I hold true is that I've never met a gray haired lady or gentleman that's in their sixties or seventies that said, I wish I didn't own all that real estate that I bought fifty years ago. No. You you just anyone who owns real estate and has held it for a long time Mhmm.

Is has a financial piece that that most others don't have. It's just a fact.

Steve: So, we had Leon Johnson on the show, years ago, and one of the things he said was my only regret is ever selling any of my properties. Like, that's his only regret. It wasn't this property I bought. I mean, we have our nightmare stories.

Mark: Right?

Steve: It is whatever. But we don't regret it. It's just part of our journey. But the ones that we sold, those are the ones that we regret.

Mark: Yeah. So we sold a a family home down in in Florida recently, and I sold it for x. And, I looked and thought, yeah. Yeah. I I got a really, really good price on it.

And then when I looked, just two years later

Steve: Mhmm.

Mark: This is post COVID, just in two years. So we sold, I think, in 2020, and then I just looked at last year. It had gone up by another 30%, the same house. And I'm thinking, you know, to to your point, I don't often regret my acquisitions, but I often regret the properties that I've sold and passed on.

Steve: Yeah. So let's see what else is there. I wanna make sure we we hit this topic before we move on. I think we think I got all my questions asked. Is there anything I didn't ask about this as far as what realtors and investors get wrong?

Mark: No. I think it's a yeah. I just I just firmly believe that, if the agents themselves or wholesalers, investors could, you know, just remember that you know, take it from an old guy, right, that's been in the game for twenty years. If they for every house that they flip, they'd hold one. Or every two houses they flip or every, you know, second wholesale commission they put in and buy another house.

Just just plan on it and plan to take that course of action. Work and if you don't wanna mess with management, make sure you got a good manager in place, but they will look back ten years and just thank this episode. I'll just thank thank Steve Trang for, And Mark. For, for, yeah, leading them down that road. There's I've never seen someone lose from buying and holding real estate.

Steve: So we got Scott Graff. He's a successful realtor in our market, and he happens to office in here as well. And so we're actually talking this morning, and and I was saying, man, I was really fortuitous to have this conversation because you and I are gonna be talking about this later on. We were talking about when we were younger, we wish we bought more assets. Right?

So he's acquired assets. I've acquired assets, but it's like, when we were younger, we were told, we were instructed by our wiser elders, hey. You should buy real estate and hold on to it. And we dismissed it. So why do you think the younger investors well, listen to this right now.

What are the reasons why they will not take action?

Mark: I think it's two things. One is finite capital. Right? So they're like, well, I I I only have $10,000, and that's not gonna buy a house in Phoenix. So they don't go and educate themselves on areas where $10,000 might be enough to go, you know, buy something.

And they they don't wanna have people are there aren't many agents or investors that just stockpile cash until they so a lot of it is patience and maturity. They're not mature enough investors to realize that, you know, putting $10 in the bank, you don't need to go invest that now in the stock market. You can just wait until you get to 40,000 and then go buy a quality asset. And then the other one is just not knowing their options, you know, not educating themselves enough to know that there are people they can collaborate and partner with to do this for them. It's, it's the who not how mentality.

It's not how can I start investing in real estate, but who could I partner with and collaborate with to bring deals to the table where I could successfully invest in real estate, without the hassles and mistakes that most rookies make? Because there's a fear associated with it. What if I put all my money in and something goes wrong? Right? I mean, there's a fair attached to anything that you're doing for the first time.

I would just challenge that, you know, partner with someone who's done it before so you don't make the mistakes that that they made when they were first going.

Steve: Yeah. You know, I have the sneaky suspicion that you don't care for the stock market.

Mark: I have very little money in the stock

Steve: market. Correct. So what are the like, why should someone not invest in the stock market?

Mark: Look. If I wanna go buy a $100,000 worth of Google stock Mhmm. How much money do I need?

Steve: About a $100,000. If I wanna go

Mark: buy a $100,000 house. Pace Morby would tell you how much money you need. Zero. Exactly. Yeah.

You know, you can just scale a portfolio better. So look. At the end of the day, if I had you know, if I was sitting on $20,000,000, would I go, you know, buy all real estate? Maybe, maybe not.

Steve: Mhmm.

Mark: But I think most of us start off in a place where we're trying to scale and grow a portfolio of wealth, and real estate is the safest vehicle

Steve: Mhmm.

Mark: Way more safe than the stock market. And there's a, you know, there's utility. I can't get passive cash flow from the stock market. And everyone will say, oh, dividends or this and that. I I get it.

I understand the game. I understand the two variances, but, you know, cash flow is a very real thing. Mhmm. And I can't leverage to buy stocks. I can't get massive cash flow.

Steve: Mhmm.

Mark: I have to sell assets in order to gain cash flow from them if I'm going in the stock market direction. Yeah. So I like the appreciation upside, which you can argue the stock market appreciates as well, but they don't allow you to depreciate. So it's the other three levers. It's scaling with leverage.

Steve: Mhmm.

Mark: It's the depreciation tax benefits because the government could care less if you invest in the market, but they absolutely want you to provide housing for people. Right. And then lastly, it's the cash flow that in retirement, I can just hold these forever. And the one thing we haven't talked about, Steve, is the legacy play. They even give you step up basis, which is a CPAs or then IRS code that says, if we when I pass away, when my wife and I, let's say, would pass away on the same day, and and so our heirs are left, our assets, their basis, which we can talk and go deep on this if you want to, but their basis steps up.

So if my basis would through depreciation, I would be depreciating my assets down to zero over a twenty seven and a half year life, typically on single family homes. So in twenty seven and a half years, my basis or what I have in the property on paper value will be zero. So if I were then to sell a portfolio for, whatever, a million dollars, then you would be paying 30% of that in tax on sale. However, if my heirs chose if I pass away and my heirs receive that same portfolio, the million dollars, their basis comes in at a million dollars. Mhmm.

So if they turn around and sell that million dollars the same day that they inherited effectively, they would be taxed zero because they're in it for a million, they sold it for a million. The step up basis is another way that there's life changing wealth transformation or, Generational. Generational wealth transferring from one to another to another. So you look at these families that have been truly, you know, the Rockefellers and Vanderbilts and Trump's and all that. It's because they passed their wealth down from generation to generation, and it's not taxed.

So they can scale and grow it, and it's largely through real estate.

Steve: Yeah. So that is actually my specific plan. Right? It's based a step up. Right?

Leveraging that. So buying rental properties, keeping them, and then passing them off to my kids Yep. At full market value as nontaxable event. So that's if you guys didn't cash that, right, you buy properties, you depreciate it down to zero with the help from the US government, and then you can you can pass it on to your kids, and they won't have to pay any taxes. Whereas, if you pass it off in stocks or cash or any other assets, even gold, they'll have to pay taxes Yeah.

On the whole thing. There's currently a limit.

Mark: I mean, there's a limit up to, like, $23,000,000. Right? But, I mean, if you get to that portfolio, well done. So, you know, there there's limitations, but just Google step up basis and how it works in real estate, and then and they'll they'll figure it out.

Steve: Another thing, the reason why I don't particularly care for the stock market. Right? So you and I have met a lot of wealthy people who they say, yeah. I mean, it was real estate, obviously. Like, what it's it's so obvious for them.

It's real estate. But how many people do we know is, like, man, I made all my money in the stock market. There are some. Yeah. There are some.

Right? But who really gets wealthy in the stock market? The brokers. Yeah. Right?

People that are trading. The people that are actively trading your your stock. Right? They get the was it asset management? One or 2% Mhmm.

Right, of the portfolio. So if Mark invests a million dollars with me, I will make $20,000 out of 2% every single year in fees, and I just need to, as a stockbroker, have a bunch of marks, right, and just get the 2% from that. And that's that's my living. So the people that actually make money in stock market are the brokers. You got it.

Yeah. They don't really talk about that so much. Right? That's kind of like a little secret. So let's talk about, the shift in this market.

So I felt an adjustment last year. Did you feel any adjustments last year?

Mark: 2022? Yeah. 2022. '22 is my lucky number, ironically, and it was a very unlucky year for us. Yeah.

You know, we fix and flip a lot of assets. We had scaled aggressively. You know, we are a turnkey provider as we talked about trying to change someone's, generational provide them generational wealth, so we're selling them done for you rental property. So we we acquire distressed assets ourselves. We rehab them ourselves.

We get them rented out ourselves, and we retain the property management. But then once it's a fully rented out turnkey rental property, we sell it to an investor with their hands up saying, hey. I'd like to build generational wealth. So, obviously, when we have so much demand, market's going up, and everyone's like, I want more. I want more.

I want more. And so we're trying to scale and grow, but, you know, we talk about velocity of of capital and and trying to get a an asset from acquisition all the way through the pipeline to get it sold on the back end can take, you know, five or six months. And suddenly, COVID hit, and we were kinda delayed a little bit with material and supply chain and labor going up. And so it kinda was bleeding out to, like, seven months. And then, our investors, when interest rates started skyrocketing, you know, July, August, they'd almost doubled from 3% to 6% in a very three or four month period of time.

Our investors were then saying, hey. Let's just you know, I just wanna pause. I wanna wait. So we had all this inventory, and our investors weren't buying. So, yeah, we absolutely felt the shift.

And then probably 50% of our inventory was on the turnkey side, like, selling to investors, and then the other 50% was retail. So now we've got retail, you know, listings that are out there that people are just like, I don't I don't think I'm gonna buy. And I like to say that there was so much there was a fervor in the market, you know, call it, even just a year ago, really. In March, April 2022, it was still everyone wanted to buy, buy, buy. And then all of a sudden, when August hit, retail buyers went away, and all of a sudden, we were left there with a bunch of assets that we had to sit on.

And when you need to sell assets, you've got one lever to pull, and that's sales price. You just had to drop price, drop price, drop price. So, yeah, we felt it for sure. We lost money in in, q three, q four, and a lot of assets.

Steve: Mhmm.

Mark: Luckily, we were well positioned. We sort you know, didn't see it coming, but we're kind of I mean, we've been we've been expecting something. Right? We've been preparing for a few years. Preparing.

So we were, you know, obviously financially fine, but it was, you don't like losing money on on deals. And so you have to really start looking at, you know, the policies and procedures and systems and process you have in place to make sure that we could quickly get these through the pipeline.

Steve: Yeah. So when the spigot stopped. Right? Because the spigot was, like, on

Mark: full blast. Yeah.

Steve: And then the March started kinda, like, just someone started twisting a little bit, and then they just shut it off. Yep. How many properties were you holding on to?

Mark: 147.

Steve: 147 properties. Yes.

Mark: That everyone was like, I don't wanna buy them.

Steve: So And I was one of those. Right? Like, because you and I had a conversation early twenty twenty two. It was like, hey, Mark. I need to restart this in my taxes.

I need to start acquiring properties. Yeah. What do you got? Right? And then the market

Mark: And at the time, we're like, dude, I'm I'm really I got so many buyers. I don't know if I can even help you.

Steve: Right. So,

Mark: no, we got to 01:47, and I had a lot of very difficult conversations with my CPA, with my coaches, with my with my team, and we set a goal. Okay? And we even made T shirts. I mean, we were committed to this goal saying chasing 90.

Steve: Mhmm. Like,

Mark: no one knew what like, are you trying to buy 90? I'm like, no. We're you're trying to sell nine no. We wanna sell down the 90 was our big goal. So by the end of the year, we wanted to go from a 147.

I think we finally committed to this in about September. So from September to 12/31 of 2022, I said, come hell or high water. We are going to be down to 90 assets. And my team were, like, solo. Now, again, sell, sell, sell, sell, sell.

So clearly, it's like sell it all, can't just get it off the books because when the market's tanking, you don't know where bottom is. Mhmm. So you'd rather trade today

Steve: on

Mark: your own terms than retrade down here on someone else's terms and be forced to sell. So we aggressively sold and really honestly, really proud of the team, that we got down we beat our goal. We got down to just 77 houses on the books at end of year. And so and now I think we're down to around 57, and we're starting starting obviously now to start buying again and and fill the pipeline. But, yeah.

So that was, a big exercise for us and something I'm very proud of.

Steve: Yeah. So what organizational changes did you have to make, or what business decisions did you need to make in that shifting market?

Mark: So the first one was sell at all costs. Like, you know, pride goes out the window when you're forced to sell. So it wasn't, you know, haggle, negotiate, you know. Some now we're paying seller pays and closing costs. You know?

It's like it's so it's funny how the market has shifted. Like, in 2021, somewhat seller would come to us and a buyer would come to us and say, we want seller paid closing costs, and we'd laugh at them, you know, and how far that pinched us.

Steve: Outrageous or suggestion.

Mark: Now we're like, hey. We'll buy your mortgage down, you know, and give you seller paid. So, yeah, the market's we're certainly open to that. We would got creative on the turnkey side. I mean, we had a lot of investors that were still saying, hey.

I I still wanna buy, but the rate's high. What can you do? And so we waive we were we did, rental guarantees, you know, on our properties, making sure that we could get them rented, get them sold quicker, would guarantee the rent even before the tenant was in place. We waive some property management fees. Anyone who bought a property before 12:31, we would waive property management fees for a calendar year.

So, yeah, we got creative because you're looking at an investor's at the pro form a. And the only thing that's really changed because, again, I'm sitting here saying it doesn't matter when you buy real estate. You can buy it even in the upswing, downswing. It doesn't matter. You just gotta hold for twenty, thirty years.

And now our investors knew that. So our turnkey stuff, we didn't have that difficult of a time getting rid of it as soon as we leveled the playing field by bringing their cap rate up, and we did that by reducing their expenses.

Steve: Mhmm.

Mark: So the levers we pulled were, you know, lease up fee and reduced management fees, and and a little bit of decreased price price on it as well. So we just pulled that lever, and then it becomes super appealing. They're still buying at a seven cap, which is kind of what our expectations are for our investor base. And so we did that. The other thing was pivoting.

We we had, done we'd pivot into new construction, and the new construction fourplexes and duplexes were a big part of our mindset for, you know, 2022 and '23. And although they got delayed in '22 and pushed into '23, that was a big pivot because they have been very, very popular and were able to, presale some of those. So that helped us in the interim as well. We we did a little restructuring. I think we had to lay off five people, which I'm not proud of.

But, you know, that's part of sitting in the CEO's seat is you have to worry about all 30 employees, not just the one that you're laying off. Right? It's, like, in the best interest of the company, to do so. And for the first time ever, and this is a credit to the culture we have built. Like, we've we could go deep on culture, actually.

It's, our our commitment to culture and team building everything is so strong that I the people that I actually laid off thanked me for the time that I'd spent

Steve: Oh, wow.

Mark: In the business, which I had never had to have before. Like, say, hey. You know, obviously, it's sensitive topic, and we're coming, pull you in, and, hey. So sorry. You know, I've gotta make some difficult decisions right now.

And they say, hey. Thank you so much for I've learned so much, and and thank you. And it was like, wow. That really hits you when you're, you know, creating their worst day that I've had in in in some time, and they thank you for it.

Steve: Yeah. I mean, that that's that's a powerful testament, to all that. So down to you said 77 assets? Yes. Yeah.

Yeah. And I appreciate you sharing this. Right? Because, like, there's not a lot of people talking about the challenges. Right?

It's like, no. You gotta double down marketing. You gotta do this. You gotta do that. So I appreciate you,

Mark: being Oh, that was the other pivot. So to get down from one forty seven down to 77, we had to stop buying, which is not fun because when you're when you're making money on act on assets that you're fixing flipping, if you shut off the faucet here, you suddenly you're you're effectively killing revenue in five or six months' time. Yeah. And we shut down for November and December and didn't buy anything. And so, you know, come June, July, there's gonna be revenue that is no longer coming into the company on our fixed and flip side.

So, again, blessed that we made some smart decisions, a, financially stable through dry powder in the bank, but also, investing in a different asset class, which was the new construction multifamily.

Steve: Mhmm.

Mark: So the the the benefit of dropping the millions of dollars from that revenue in the summertime will get us through this this awkwardness in the moment. And I also we cut advertising, for that period as well. So there were some big moves there just to make sure that we we right sized and focused on the right thing. But I think any anyone who's not looking at their bottom line right now with, some serious, consternation needs to, you know, be kinda checking their checking their look in the mirror.

Steve: Yeah. And then, so you guys are buying again? Yep. And you guys are back to being the biggest buyer in the KC market.

Mark: Yeah. I mean, I think that's fair to say. I mean, there are people that might wholesale a few more properties than us. But as far as someone who's fixed and flipping, I don't know anyone that's doing more volume than us. But we are gonna dumb it down.

We got up to where, you know, we're doing a couple 100 a year, and that was stressful. What I'm realizing now is that we put way too much strain on our rehab team

Steve: Mhmm.

Mark: And the contractors involved and, just assumed that, you know, if we were averaging five and a half months, we could double volume and still stay at five and a half months of construction, and that's just not how it works. So, we're now probably gonna just cycle back down to just doing 10 or 12 a month and and and call it good. So a 100 to a 120 houses a year.

Steve: Only ten, twelve a month. No big deal. So, I want to get to the audience's questions. And right before we do that, we're gonna do a very, very quick commercial. These eight steps are why I was able to build a sales floor that produced over $20,000,000 annually in wholesale profits.

If you take and embrace these same steps, I know for a fact it's gonna work in your organization too. Now we only have 30 seats available in this classroom. I can't work with everybody. This is super personalized and super custom to your organization. I will personally work with each and every one of you to craft the language, the culture, the KPIs, the fifteenth and thirty day protocols, and help you go home with a toolbox for leadership that is going to drive results.

I hope that you can take advantage of this opportunity. During this two day workshop, I'm gonna be going over these eight steps and so much more that I didn't even have time to mention in this video. I'm gonna personally sit down with you on a one on one basis and make sure that you have the tools that are gonna get you success. This sales leadership program has a money back guarantee. If you don't see improvement in your revenue numbers, improvement in culture, improvement in accountability, we personally guarantee to refund the full amount of your payment.

Alright. So the first question, on YouTube, the fleet, interest rate dropped not by much. How do you see any markets changing coming, or do you see a decrease still? So I guess we're asking you to look into the crystal ball here.

Mark: Yeah. Yeah. Happy to. I mean, that's just my opinion, but, I mean, that's what he's asking. Right?

I mean, no one knows. But, I believe we're gonna have a really strong month of sales. We're even seeing, because we have our pulse on the market on the retail side, we're still actively buying and selling. We have about 20 active listings on the market, and we're getting multiple showings again. Not multiple offers as often, although that occasionally is happening.

But we're getting a lot of show showing activities picked up. It was dead for, October and November were just dead.

Steve: Mhmm.

Mark: December picked back up a little bit. We were blessed with a pretty decent, winter in January where it wasn't too bad, and we started selling product, and we're really seeing it pick up. I believe March through July will be a strong retail, side, but after July, I do anticipate it probably falling off again a little bit. I'm not bullish on, you know, November, December '23. What do

Steve: you what what is the cause for that?

Mark: I just think, there'll be more I think more people will put their houses on the market. Right now, there's still such low inventory Mhmm. That when your house is on the market, you know, you're getting any eyeballs that are on it will will go. But I think that, you know, we are very cyclical in Kansas City. Winter, the the months of December and January are our slowest, and we really haven't had a slow winter for a long time.

It hasn't built back up. You look at like a pendulum. You know, the normal amount of housing on the market is is five months. And in 2014, it bottomed out and got to about eleven months of inventory on the market. In 2014, when all of the craziness That

Steve: was as slow as you guys ever got. What's that?

Mark: 11 of inventory on the market?

Steve: Slow as you guys I mean, over here, we got to, like, three years of inventory.

Mark: Wow. Yeah. No. It was about eleven months of in the market, I believe, was was was where we pushed out. And now we're still back to about 1.7 we we got to about, you know, point seven months of inventory in the three weeks.

Now we're about back to 1.7 or two months of inventory in the market. You still

Steve: have low inventory?

Mark: Yeah. So it's still low inventory, so I'm feeling bullish, but it it has to just keep bleeding. Now I think, you know, as far so market will definitely be depressed a little bit. As more inventory comes on the market, it'll be harder to sell. But that's why I think the attention to detail we've actually brought on and and, we've brought on a consultant who goes to every single one of our flips with an as an interior designer Mhmm.

Just to give us a little bit of flare. I think we had gotten when we started looking internally at what our weaknesses are, I think we realized that, you know, just the standard package of rehab was not gonna cut it anymore. We needed to establish ourselves to be the pre premier house flipper. K.

Steve: And,

Mark: again, we don't do million dollar flips, so we're certainly not going super, super high end. But in that range from 200 to 500,000 in Kansas City, we offer really good product. Mhmm. And that's what we got back to was, elevating ourselves beyond what we found that everyone started copying us. Mhmm.

And so we started to look at all these flips and, like, oh, that looks like one of ours. Hey, it wasn't. What's going on?

Steve: Mhmm.

Mark: So once we saw that, you know, imitation is a great form of flattery, but we needed to raise our game. So now we're going back and keeping up with the trends and doing a few different things. You know, putting using wallpaper again, we're doing accent walls, with some, trim carpentry and those kind of things to elevate and even on, like, a $300,000 house.

Steve: Alright. Got it. Follow-up question is, do you happen to know if Illinois has any restrictions on wholesaling real estate?

Mark: I don't think anywhere has holes no. I don't I think you can always you can wholesale in every market. I'm pretty sure. Again, not a huge wholesale is probably a question that you could answer.

Steve: I would say Illinois, you just have to be a licensed realtor to wholesale in Illinois, which is a really silly rule. But yeah. So in Illinois, the restriction Illinois and Oklahoma had to be licensed realtor. Do you buy in Florida or or Illinois?

Mark: We just pulled out of Illinois. We were there for a while. We found that the bureaucratic red tape

Steve: Mhmm.

Mark: Was just for a fix and flipper, was was too much for us to bear, and we started getting our rehab pipeline just got, you know, extremely bloated, just sitting on waiting for them to act. So we pulled out of there. And now Florida is a market that we have been in. We took advantage of a real when it bottomed out in thirteen, fourteen, fifteen, we started going buying and flipping down there. So we still have a couple of rentals and, some short term rentals down there, but we're not actively buying.

Steve: Yeah. But we

Mark: know a lot of people that aren't. They wanna throw us a lead. Right?

Steve: Yeah.

Mark: There you go. You and I got a lot of friends down there.

Steve: We should call it bureaucratic blue tape. Yes. Exactly. Stop calling it red tape. Do you purchase properties with cash, or do you do creative deals?

Mark: Cash is the answer to that. But I'm also we have strong banking relationships. So one of the strengths of our operation is that we have been working with our banking partners so long that, unless it's a quick, you know what everyone's like cash closed quickly in a week and and most most of the time you realize people don't wanna close in a week. They're like, hey. Give me time to pack up my stuff.

So most of the time, we're closing an average of three to four weeks, and that gives us time to, go to the title company, go to the bank, and we're closing with just 10% down and and the bank financing the balance, and then getting our construction loans in place to turn around. So cash, but the bank financing is a is a big part of it. We haven't gone big on creative, but that's, you know, when Pace came and talked to us, it's certainly a takeaway that we need to think more about, and we're going to be offering more seller solutions. Mhmm. You know, we just had a a seller, in my office on Monday that was talking about, a fourplex that he owned, and the big thing for him was he just didn't want to pay anything attacks.

Had a stronger version to paying any tax than he owed. He was his basis was zero because he'd held it for twenty years, and he has a fourplex that's in decent shape. And so I proposed to him, hey. It's still a finance opportunity, and he's open to that. So now we've just gotta go back with some options.

So, you know, just trying to if you have five or six different options for a way a seller can exit their property Mhmm. Rather than just, I'll pay you x, take it or leave it, I think you're gonna win more in the living room.

Steve: Yeah. Absolutely. And that's something that, Eddie Speed and I are working on together is how to switch to, creative if cash isn't working. Mhmm. So, you know, for us in our our order of offers, right, is a cash deal where we'll buy it, a wholesale deal, innovations deal Mhmm.

Create a deal. And if none of those things work, referral to a realtor. Yeah.

Mark: You got it. No. That's it. And I think everyone should be pivoting to that model. That's Yeah.

Very, very strong, and that's common across the industry right now with the people that I'm talking to is just you've got to provide multiple, sales strategies for them when you go into the living room. Yeah.

Steve: Absolutely. So Jonathan Asbel wants to know on Facebook, what are you doing to systemize your fix and flip? So if you can go just a little more detail on how you're doing that exactly.

Mark: So specifically the construction side? Well,

Steve: it says fix and flip.

Mark: Yeah. So my goodness. The fix and flip really is is all about construction. And we are, you know, there's an old there's a book, and an old saying measure what matters.

Steve: Mhmm.

Mark: So we're measuring everything from, acquisition to, trash out, from or acquisition to to keys, from keys to trash out, from trash out to the first bid, to bid getting submitted to bid approved. Like, literally, every step along the way is getting measured in days and getting kind of a red, yellow, green. If it's off track, we get a red and then tracking each one. So measuring every little step and putting parameters along the way so I can so we can get alerted when something is falling out of out of track because for a long time, we weren't measuring it. And suddenly we'd look back and be like, wait.

Why why is this house just coming to you now? I remember walking this five months ago.

Steve: Yeah.

Mark: You know, why is it just now coming, you know, on on market? So if you don't watch it and you're not and then the other thing is just purely managed by walking about. You've got to get out on the job site. You've got to have your project managers, you know, on the jobs, making decisions in real time. If you leave it to, the contractors to make decisions, then, you know, you're, probably going to to be up, up a creek.

Steve: Mhmm.

Mark: The other thing we're doing, Steve, is we've had a outage. Yeah. The other thing we're doing is, systematizing by SKUs. So I think if you go to, what is our website? S b d contractor dot com, I think it has literally every SKU that we have and every product, that we put in the house for our turnkey product and for our flip product.

Mhmm. So that being said, they can simply go on there, and we provide them a very easy solution either at Lowe's or Home Depot, whichever our contractor wants to use. They have specific SKUs for a faucet, for a a vanity, for a countertop, for, you know, flooring. So you have to make it very easy for the contractor to to be able to give us a bid and and get that bid approved and then and then hold them accountable. Then the other thing is having penalties for delays.

Mhmm. So we have accountability meeting each week that our director of construction runs with our different contractors where they come into the office. We sit down, and we talk through, are you on track or off track?

Steve: Mhmm.

Mark: And while you're because, you know, sometimes we'll get well, your flooring guys didn't show up. Okay. Well, how many days did that delay you? Well, that would delay us two days. Okay.

Then there are two excused days, like an excused absence. So there are two excused days, but we let them pick their completion date. And if they don't hit their completion date, it's a $200 a day penalty. Because and then, again, if it if it goes out by two days and there were two days excused, then there's no penalty. But if they'd missed by twenty days and only ten days are excused, then they'd be paying us, you know, a cool end of, $2,000 on the back end.

So holding our contractors accountable, putting measurements in place, you're not trying to penalize them. You're just trying to say, hey. If things drag, especially when the market's going like this, it's costing us way more than $200 a day, not just with the carrying cost and the interest and the consternation that we have to go in and and start, you know, applying more and more of our time and effort and energy around the actual babysitting it. Getting the house and babysitting it. And then it's gonna sell for less because we're taking, you know, too longer, and the market might be going down.

So we went back and looked, and and it's been since we've implemented that, it's gotten a lot better.

Steve: That's awesome. You know? I have people ask me all the time, Steve, why don't you flip? And my answer's always been, I don't I don't need any more people to manage. It's not a requirement.

It's like anything.

Mark: If you wanna be good at it, you've gotta measure it, track it, and then hold people accountable. And Yeah. You've you've got people that are that are doing that on a on a regular basis in the construction field.

Steve: Right. But I'm saying, like, that's just one more thing I gotta do. It's like, yeah. No. I'm good here.

Yeah. So you mentioned a book, Measure What Matters. So not a lot of people talk about the well, they talk about, you know, traction. They talk about, the four disciplines of execution. Mhmm.

Right. There's all sorts of different books. Why measure what matters?

Mark: It was, I mean, well done on the title. I you know, I'm always on the title. Yeah. I'm I'm always, I don't know if that one was referred to me if I picked it up off a shelf, but, I mean, when the when I saw it, I think that was one I'm just I think it might have even been a Barnes and Noble. Hey.

You like this book. What about this book? You know? Yeah. Or on Amazon.

So, yeah, pulled it, read it, and it it's just it was just if you care about the number, it said two things. If you care about the number, measure it. Mhmm. And then if you're measuring something that you if you're given a report and you don't read it, then you shouldn't be measuring it anyway. Don't don't dump a whole bunch of KPIs on your team if they're not really applicable to you.

Like, have them measure only what matters. So it's sometimes we just get so dragged bogged down in the minutiae Mhmm. That we have our employees creating reports to give to us, and then you don't even read them anyways. So Yeah. I think fewer metrics and ones that actually matter, are the key takeaways from that book.

Steve: Yeah. I can't remember exactly who wrote it, but Google runs their business by measure what matters or OKRs. Right? So Google runs their business that way. And this is all out of the brainchild from, Andy Grove, one of the founders of Intel.

So, we haven't implemented a lot of it. It was a it was a very fascinating book, right, for business concepts, but, you know, we already have our existing processes and structures. Not saying that they're, like, we can't change them. It's just it's it's a little bit of a different philosophy style. I was just curious as

Mark: to,

Steve: to how that came up. A follow-up question from Jonathan Asbel. What assets do you believe are in for a major fall?

Mark: So there's some danger with short term. People are becoming, short term rentals are here to stay. Airbnb, Vicasa, you know, all the big boys are, they they've hit a niche because I enjoy traveling and staying in a home even especially with another family if we go rather than staying in a hotel. Just it's a better feel. We have put, you know, your own privacy, that kind of thing.

So they're here to stay. However, there could be a crash with legislating out short term rentals in certain areas. They're kicking up a fuss, and so that's something that I would be very cautious of. If people are buying in an area and then suddenly short term rentals are either outlawed or no longer available, that will be a big dip. I think, in general, I think there'll be a haircut across the board with, you know, the the fervor that was in the market.

Let's say you had a house that was gonna go on the market for $300,000. You get multiple offers and you'd end up selling for $3.30. I think we've leveled off. Like, it's not so much that the market's gone down 10%. I just think the fervor of multiple offers, highest and best, and you have to pay more is gone.

Steve: Wholesaling for full market value.

Mark: It's crazy. Right? Yeah. So I think there's a correction that's taking place, but I don't I'm not not betting on real estate. I don't necessarily think that, you know, the answer to his question clearly is, you know, the the stuff in the, you know, 700 plus range.

Right? That's always the first to feel it. But where we're at in Kansas City, I mean, our market swings up and down are so even keeled anyway that we're really not concerned about the price of it. But having said that, I think there's opportunities with rental assets because you are going to have stronger appreciation with fewer buyers coming into the market on a, retail side. They're gonna have to rent either longer Mhmm.

Or, move into renting. And so I think there's opportunities with, you know, new construction rentals. You know, really high quality rental homes will be an area for improvement. And then new construction single family is probably gonna take a hit as well when you people that are building new construction single family, with rates, you know, remaining high. It's just hard for someone to go and chunk down, you know, $400,000 for a smaller home, then they can go get a used one for the same same thing.

Right.

Steve: Chief Keith wants to know, what is your biggest regret in real estate?

Mark: You know, everything happens for a reason. So I can't I I wouldn't even say the business divorce was my biggest regret, that spurred me on to, to different topics. You know, there are some peep not growing as an individual. I think if I was to self reflect, I think I could have grown as a leader of men, and women, earlier in my career and invested more in myself, because I think there was some turmoil. You know, I you know, as a small entrepreneur, a small business owner and entrepreneur back in the, in the day, I I didn't you're you're just you're hustling and grinding, and the thing I didn't realize was that your employees are never gonna hustle and grind and care about a company the same way you do.

They care, but they never care like you do. And you have to respect that once you reach a certain point, probably, you know, north of six or seven employees, like, you work for them now. Mhmm.

Steve: And I

Mark: think realizing that sooner, like, investing in in in and I read books on business and scaling and growing, but I didn't really invest in myself in becoming a better leader of men and women, and that's probably a regret that I have. I think I would have accelerated my company's learning curve and and avoided some of the layoffs that I had to to do. What I've done well, I would answer that question also by saying I feel like what I've done well recently is hired super talented people. Like, our team right now is, you know, really, really elevated, to the point where, you know, truly, they know more about their position than I do. I mean, there are these are people that are, highly qualified in each of their craft, whether it be finance or marketing or acquisitions or property management.

In all capacities, they're they're operating at a really high level. And so probably my biggest forget would be have you know, when you're a small business owner, you tend to just say, I have a budget of $60,000 to to bring on a new, you know, acquisitions agent or whatever or whatever as a marketing person. We're not realizing that for $70, you could get someone that's way more talented, holds himself accountable more, is gonna be a better team member. Mhmm.

Steve: And you

Mark: won't have to fire that person you're gonna only pay 64 when they wanna leave and get what they're really worth down the road. So, you know, I think anyone who's scaling and growing a company should take a strong look at the value that a a truly talented, team member can bring to the table. Because when you pay for talent

Steve: Mhmm.

Mark: You can step out of the the role a little bit sooner, and they will elevate and allow you to go focus on what your, core competencies are Yeah. Along the way.

Steve: Earlier in the show, you were talking about culture. You know, we can have a total deep dive about culture.

Mark: Mhmm.

Steve: So what are your thoughts on you know? What what what about culture are you are are you most passionate about?

Mark: You know, everyone wants to have a a place where they do enjoy coming to work every day. I think I was unable to provide that before I hired my COO. Mhmm. Because I didn't realize that people actually wanna be held accountable, and I am lousy at that. That is one of my, you know, cryptonites.

You and me both. Just just I mean, I I walk into a room. I'd say, this is what we should you know, Do we all agree this is the right thing to do? Okay. Great.

Go do it. And then I walk out and assume that everyone's gonna get it done. Well, now I walk out of the room. Chris Jones is still there like, okay. Takeaways.

You do this, and you do that. And what were you gonna do? And do you remember what you were meant to do? And and then let's write that down. Let's put it in planner and tasks and and make sure that everyone's on the same page, and and then we're gonna meet back next week and make sure we've got these tasks lined up.

I'm like, oh, so that's how you become a high functioning, you know, office. So, yeah, our partnership between Chris and I has, really benefited, the company because there's yeah. You gotta have the visionary and the vision, you know, and someone that's creating big idea coming up with big ideas and creating big relationships and and avenues to grow. In fact, as I said earlier, I mean, if we didn't have the multifamily new construction, we would be in a very difficult position right now. That's an area where I saw growth, and we went and tackled that.

But to have someone behind the scenes that's, working tirelessly to create an environment where people can, grow and learn and become the best vision best versions of themselves, I think, would be very valuable. And the other thing is really investing and getting to know the people that you're working with. Yeah. You know, it's the little things. You know?

We, have gone to royals games together. We've gone, curling together, like, on the ice. There was a great Chris company Christmas party. We've had the ice cream truck come to the office. We've had pancake breakfast.

You know, you've when you're spending that much time together, you've got to get to know people. And I think you would, I think people in our space well, you've heard of NPS?

Steve: Yeah. Net promoter score. Yep. K.

Mark: So net promoter score for those out there. It's basically a way to to gauge how well you are doing typically with your customers or but there's eNPS, which is an employee net promoter score, which gauges how well you are doing as a company, and it's all anonymous so everyone can be very transparent. So when we first did our survey, we got a 71, which is off the charts amazing. Anything north of 70 is exceptional. Mhmm.

And that but they said, the one thing we want was health, health insurance health insurance because we didn't offer health insurance as a company benefit. So we added that last year despite obviously all we were going through as a benefit. And, you know, the other thing was merch. We learned, you know, that, hey. We'd like a little bit more work merch.

No worries. So now we, you know, provide them a t shirt every quarter, like, chasing 90 or, you know, whatever the theme might be. We're giving them a little bit of merch, and it's those things that are that provide, you know, a way for them to feel like they're part of a team. And we are now proud to say that we raised it. We're in '91 on the EMPS out of 30 employees.

Wow. 91. I think there was, like, two people. There was no detractors, and there was, there were some neutrals, and then I think nine out of 10 were obviously in the promoters. So it's super strong, you know, culture at the office.

And, again, I take very little credit because it's not me that's changed, but it's the team that has rallied and, you know, we we put people in positions to actually be culture warriors for us to build that amongst the people and hiring the right people, right people, right seat, has been a big part of it.

Steve: So there's something you said a small part of it, you just kinda breeze through it, was the same page. Right? And Chris is Chris Johns, right, who's also been in the show, talks about, you know, you know what you're gonna do, when it's gonna be done by this and that, right, put it on the planner. But that part is about the same page. Mhmm.

Where I struggle the most as a visionary is, like, here's what I want. And for the longest time, what I said I wanted and what they heard were not the same thing. So, you know, I'm not great at this, but I'm getting a little bit better. Right? So now we're talking about, you know, here's what I want.

Here's why it's important. Here's when I like it here's when I like to have it done by. And, what questions do you need me to answer before you proceed to get this done? Right? So I'm not great at this.

But I'm getting slowly better at it.

Mark: One of the ways we've one of the things we've implemented in the last last twelve months, you know, because people want clarity in their position, is the one page strategic OPSP that came out of, Daniel Marcus's, you know, coaching that that I've done with him. And the importance of having so on the OPSP, it's literally one page, and it has your core values, which obviously and your BHAG. It has your, annual goals, your core the company's annual goals, company's quarterly goals, and then the the lower third of the paper is for their metrics and their KPIs. What are the and their goals for the next ninety days. And every ninety days, they review it, they talk about it with the manager, and they make sure everyone they have a plan.

So it's very simple. They know if they do these three things and hit these three metrics

Steve: Mhmm.

Mark: They're winning. You know, it's you talked about four d s, you know, Chris McChesney's book, The Four Disciplines of Execution. He says, give your employees a winnable game, and then just keep score. Yeah. So if you give your employees a winnable game and then have a scoreboard, you know, LeBron would not be driving down, you know, the to to lay up for two if they needed three to win.

You know, you've got a scoreboard to know where you're at in the game. Right. So give your employees as a score or give your employees a winnable game. So show what we wanna get done, and then just just document it through metrics to to see where they are on track

Steve: or not. That's a really, really great plan. Great point. And, you know, talking about Daniel Marcus, he was on the show, in November. Right?

So a few months ago. And, man, like, what what a story that guy's had.

Mark: He's at least loved my time with Daniel.

Steve: Yeah. And then we were talking about something. Yeah. We're talking about, irrational confidence. I think or no.

It wasn't that. We were talking about infinite risk tolerance.

Mark: Mhmm.

Steve: And he's like, I told him, I don't think there's any person I've met in my life that's had, like, a high risk tolerance than myself. He's like

Mark: That's, so one of the things that Dan so Daniel, is is is my coach and, and love him dearly. One of the peep obviously, one of the people I reached out to when, you know, everything was tanking and and and and things just weren't selling, and I'm like, hey. Just, you know, on our weekly call, I'm like, well, monthly call. I'm like, what do I do here? And one of the things that he said to me that I will always remember is, Mark, there are times for a CEO to be, watching what is going on, and there are times for a CEO to jump in and start working on the business.

Roll up your sleeves. The next two years for real estate, you're gonna have to work in the business. Mhmm. Like, everyone wants to work on their business and this and that. He's like, no.

No. No. No. You know, there's, you know, there's times for you when stuff is smooth sailing, you can tweak and and go do this and work on bigger projects. Now is the time to roll your sleeves up, get stuck back into the minutia.

Everyone wants a self operating business. Mhmm. But until it becomes until it is self operating, you gotta get in there and operate. And, you know, when there are you know, when there's unfortunately a few layoffs, I think we laid off four or five people as I said back in October. You know, that that there's a little disruption in the org.

You gotta make sure that people have a clear vision. So preach your vision daily. We have more we're big morning huddle people. That was another, culture thing. We have a daily morning huddle, 08:37 every single morning, that everyone is on and and talking about their wins and things that they're doing in the business.

That's been a big part of people getting to know each other because they can say personal wins as well as the business wins, so you get to know the people. But, yeah, that was a big wake up call when he said jump in the business and start working on it.

Steve: Yeah. And, he he's gone through adversity. He's seen a lot. So, I I think I I think that's awesome. And, you know, it was interesting when he was in here.

He was like, yeah. You guys talking about, like, doubling down and trying to conquer and and seize market share right now? Like, you guys are talking about 2020 and and in 2022 and maybe 2023. He's like, you guys are too shortsighted. You gotta be ready for 2024.

It's like, that's that's a long thinking. Right? Business owner. Another thing too, Tom, you know, rolling your sleeves up is that something Ron Bartlett and I, you know, mostly Ron Bartlett talks about is, like, there's wartime CEO

Mark: Mhmm.

Steve: And there's peacetime CEO. I've been a pretty good time pretty decent peacetime CEO. I was a pretty good wartime operator, but I've never had to be a wartime CEO because when things things were tough last time, I was in the field. I was I was the boots on the ground. So this is a whole different world.

Yeah. And I think in

Mark: the wartime CEOs, what they do is they they keep preaching the same message.

Steve: Mhmm.

Mark: They give their troops, stability through, a a clear vision of what you're going to do to get them through this time. One of the big messages that I sent to my team was, hey, guys. I've been here before. I've been in twenty years. I'm glad that this is not our first rodeo.

We got through o eight, o '9. I've seen market cycles. We've prepared for this. You know, we've got dry powder in the bank. We understand this is how we're gonna succeed.

This is what I need you to do. Now go do. Mhmm. You know? So you give them a clear vision of what's gonna happen.

I think it it you know, again, everyone you know, I'm not saying that there's not any concern in in in the markets, but, you know, we we at least had a plan, and we kept directing people towards that plan.

Steve: Yeah. I like that. And we actually have Lina in my organization, and she she said to me, it's like, Steve, how are you so freaking positive all the time? I was like, a, you're the only person on the planet that thinks I'm a positive person. And b, I've got perspective.

Like I said, you know, I started, you know, in 2007. Yeah. I got to witness the last crash, you know, and, like, being friends or colleagues with people that were going to work and the doors were chained shut because the doors were permanently closed, not by their own decision, but by the landlord because they couldn't pay their bills. Right? Like, give me you hear stories of this.

Yeah. But I knew the people that went through it. You know? I knew the people that were getting divorced, whether they were realtors or contractors. Money was bad in 2007 to 2009.

And when money is bad, you know what the next thing is. Yep. Right? So I was saying I was just sharing with her. It's like, yeah.

I'm not a positive person. It's just this is nothing compared to what I've gone through before. Perspective. Yeah. Alright.

So we got some more questions in here. So we're talking about biggest written real estate. What is so if real estate was not an option, what other industry or business would you be in?

Mark: Real estate was not an option. God, isn't it sad I've really not given that much thought?

Steve: Well, that's a great thing because real estate is good.

Mark: So I think what we do what I do well I think I give people options to invest their capital. So and and, so real estate, is the vehicle, but I and but if I wasn't, like, fix and flipping, I'd probably go to some medium where, call it a real estate financial adviser. But some mechanism, you know, where I enjoy I know that there is, a lot of wealth there that is untagged untapped right now where people are just putting in their money in the markets just because they don't have any other options. So I do feel passionate, and I know it's not answering the question because I guess it's real estate. But it certainly would be pivoting to a different direction than where I currently am, but just advising people, you know, of ways to avoid just that trap of just putting money into the stock market, giving them other options and alternatives.

Because, it could be lending. It could be funds and syndications. There's many, many areas, to do private lending deals or things like that that are fringe real estate, but, you know, outside of the fix and flip game. I think I'd be trying to open up and and just I've realized that, you know and David Phelps is

Steve: so great at it. Right?

Mark: And he's a mentor of mine, but collaboration, the who not how is something big that really came to me probably later in life. Not how can I build wealth or how can I fix this problem, but who could I collaborate with to help me build wealth? Who could I, bring on board to help me solve this problem? And I think you start just creating partnerships and strategic alliances and Mhmm. You know, opportunities abound.

Steve: Yeah. We we on this podcast and other shows we have on this channel, we talk about how, you know, potentially, college could be a bit of a scam. A little scammy. Right? I think stock market's like that last step.

Right? It's that you go to school, get good grades. Right? Go get a job. And then and there's nothing wrong with that path so long as you select that path.

You gotta opt into that path. Don't default in that path. Right? And so you go get a job, and then the last thing is the last step I think of that, you know, forced, indoctrination is stock market.

Mark: Yep. Right? No. You're right. And, I mean, college is one of those things that we're looking at now, and I've just been very clear with my my children as to what I view college, which is if you're unsure because you're still maturing.

You're still growing. You don't if you don't have a clear path of what you wanna do, it's a great way to go and, learn and network and grow as an individual.

Steve: It's a good default path.

Mark: It's a good default path. I'm a big fan of an an what in New Zealand, we call an OE, an overseas experience. You know, obviously, growing up in New Zealand, is very, very different. We are such a small country that you're automatically looking rest of the world what's going on. I think it's the opposite.

Because America is so big, most people like, well, I don't need to go. If I wanna go to beach, I go to California or Florida. If I wanna go to mountains, I go to Colorado. Like, what? I don't need to travel to this Swiss Alps or I don't need to go to Tahiti to go to beach.

But in New Zealand, you're just always looking outward because we're such a small nation. It's kind of like little brother syndrome. And so in that same way, I would challenge that taking a year off and exploring the rest of the world and going, seeing what there is to offer, you've just gotta mature into who you wanna be when you grow

Steve: up. Mhmm.

Mark: And so I'm encouraging my children that college is to network and grow your friends because, your network oftentimes is equivalent to your net worth. And if you can grow to grow your net worth, there's a lot of times it's just, utilizing and growing and befriending your network.

Steve: Yeah. You know, Mike Stansbury? He's a Yes. CJ member. Right?

So we're doing the call earlier at Well Club. Paul Sparks and I were doing that call. And, I liked what he had to say was that, you know, the rules for setting up his business. One lens he looks at his business in is am I creating this business in a way that if I I can sell it if I were so inclined as one lens. The other lens is I'm creating a business that my children may be interested in opting in to join me.

Not forcing them

Mark: Mhmm.

Steve: To join him, but am I creating a business where my kids can opt in and wanna work with me if that was the direction they wanna go? So I was like, that's pretty cool. Right? Am I building a business where my kids, if they wanted to, can join me?

Mark: No doubt.

Steve: Alright. So, this is another question from the audience. It's our good friend Eric Martin here. Hey. So who do you got?

Chiefs or Eagles?

Mark: Well, hey. The look at the look at the theme. We we put the red on for the Chiefs. Right? Oh, man.

No. I'm super excited. You know, it's kind of a little strange for me to be here, in Phoenix with the waste management Phoenix Open. You know, I'm a big golfer and the Super Bowl, and I'm going to neither, but blessed to be here with you.

Steve: Why wouldn't you go to either? You should just stick around.

Mark: Well, I've, got obligations this weekend. We're actually heading out to meet a lot of our friends at the Freedom Founders Mastermind event this weekend. So I'm excited. But, no, Chiefs, let me let me throw a prediction out there. I believe the Chiefs is kinda eked by, like, by two or three points in most of their games, and they just find a way to win.

Mhmm. I think they're due to have a blowout. So I think they're gonna win by 10. Go, Chiefs.

Steve: Blowout? 10? I'll say we're gonna go blah. Like, let's go four touchdowns.

Mark: Don't think we'll get there. No. Super respect. I mean, it's gonna be an awesome game. I can't wait.

Steve: Alright. And then a question from Martin Nadirsha. Multifamily is easier or more difficult heading into the future?

Mark: That's fairly vague. What do you mean more difficult, you think?

Steve: I think probably investing to invest in.

Mark: I think in general, like, I think that how I would comment there is that Wall Street is firmly entrenched in Main Street. Like, the the fact that Wall Street has started investing in single family homes in a very meaningful way, and we haven't gone down this path. It's probably another episode, but, it it's a massive impact, and, they're insatiable in their appetite for more. They will not go away. People that think this is just a, you know, a one off is are completely wrong.

They in the same way that Lowe's and Home Depot are now, like, 77% market share in the hardware space, whereas if you go back fifty years and it would have been, you know, mister Smith on the hardware store on the corner, like, they're just gone. Like, now and in the same way, I think mister and miss Smith landlords are gonna be gone there because they're gobbling up all the inventory. And there'll be a time where there'll be a Lowe's and Home Depot, if you will allow me the analogy, of landlording.

Steve: Mhmm.

Mark: And they will own so many single family rentals that they will, just dominate the space. So Wall Street coming in, taking advantage of single family in the same way that they have kind of done multifamily. Yeah. I think real estate's gonna be harder to to find deals. But the encouragement I would give your audience is that you it it's a it's a nimble and a very inefficient business.

Right? You can't trade it, instantaneously like you can on the stock market. Right? So the inefficiencies of, trading allow for opportunity. And so when it takes thirty or sixty days to sell an asset, that's time and opportunity for someone to go and get a deal.

Mhmm. When there's local operators that know a market that can go in and snag up a deal because I've just driven by it many times and they go knock on the door of the owner, there's opportunity there because it's not always just at a certain strike price and you know exactly the current market value. Value is determined by, utility as well as current market value. Can you use it for something, and and what is it worth to different people? So there'll always be opportunities.

But, yeah, it's gonna continue to get more and more challenging in the single family spaces. Wall Street firmly gets their their hands on it.

Steve: Yeah. It it's kinda like you're saying with the local store. Like, it's just like when Walmart were going to town or, I guess, these days, Amazon. Yeah. It's going online.

So one thing you and I were talking about offline before we started the show was your superpower. Right? So talk about talk talk to me about your your superpower.

Mark: Well, I know, that you asked every time. So I was just I was contemplating, you know, what what is my superpower? And, you know, I think about that, and you think about superheroes, you know, that have a superpower, they're born with it.

Steve: Mhmm.

Mark: I believe my greatest superpower was my parents and my upbringing because it afforded me I mean, they they grew wings so that I could fly away. And I think that my family background is my superpower. And, you know, truly, like, getting to know the Dela tour family, people understand that. When I went back home recently, I'm just reminded by it. I'm you know, with one of my sister's friends, and she said, look.

There's, you know, it's everyone's family and dysfunctional families that way down here, and then there's their normal family, and then there's the Delator family. And I'm not taking praise myself. I'm hating praise on my parents because they that is intentional that they just put so much time and effort into raising such great children. Mhmm. I mean, I'm the the least performing.

Like, my my siblings are amazing. My brother is a a, you know, very famous actor in New Zealand, has been on many shows in America. My sister was a world class triathlete and now is just the most phenomenal mother and and, a great business owner. And, my older brother, Andrew, is super humble, but just a great guy. And he's running the he's the country manager for a rental car company in New Zealand.

So just amazing people, and I just really enjoy my time with them.

Steve: Mhmm.

Mark: Always love getting back home, and I think the greatest challenge that we have as individuals is parenting. And I think that's what if you look at what's going wrong in America or New Zealand or any big country, it's you can it often comes back to, you know, what what, environment was this child raised in? If we could become better people and better parents and take care of our children and raise them up to be loving, well respecting people, the earth's gonna be a better place.

Steve: And I

Mark: think my superpower was being raised by, two people that loved each other. They they met each other when they were 14 and 16 years old. They have been married for fifty years, and they just continue to encourage us to do be the best humans we can be.

Steve: Yeah. No. That's that's that's incredible. So I want to I want to think about a message you wanna leave all the listeners with while we make just a couple of quick announcements. Mhmm.

Guys, if you get value today, you know, please like, subscribe, share, comment. We actually did a q and a yesterday, and there were some complaints that they didn't know about the q and a. So if you guys are not subscribed, subscribe and hit the bell so you guys are aware when we go live for a q and a because we don't keep those up. And then we do have our sales leadership event coming up. You know, Wren is gonna be leading it.

If you guys are running a if you guys are running an organization or potentially your top salespeople are leaving, they're not working hard, it seems like they don't care much as much about your, their business as you do about your business. Check out what Ren and I are offering. Text leaders to 33777. It's possible. I've seen it now with Ren's help that you can have your salespeople want to work as hard as you do.

Right? You just gotta figure out how to lead them effectively. And then we got part in the disruption tomorrow and certainty talks on Friday, and Max Vollmer coming out next week. So make sure you check out that all that as well. So what are some last thoughts you'd like to leave the listeners with?

Mark: Sure. Let me finish by saying, don't wait to buy real estate, buy real estate and wait. I truly believe that the greatest wealth accumulation that anyone listening to this podcast will have over the next twenty years will be directly tied to real estate. If you have money now, buy housing. If you don't have money now, invest in yourself to learn about who you can partner with, how you can grow your real estate portfolio in the future, and start saving money.

Don't just default to the norm, which is trusting a financial advisor, quote unquote, to put your money into the stock market. Like, that is a default option. Be exceptional. Find out what you're going to find out people that you can partner with. Educate yourself on how to invest in real estate, and then take that action because I can promise you in twenty years' time, you'll look back and just wish that you'd bought more real estate.

Steve: Yeah. No. That's that's fantastic. And if you guys need any further, I don't know, ammo proof that stock market's a scam. Tony Robbins wrote a great book, money master the game, and I was furious after reading that book or listening to that book about, like, how much of a scam, the stock market is.

Mark: If you're not on the inside, you're firmly on the outside.

Steve: Yeah. Ex exactly right. How can someone get a hold of you?

Mark: Oh, yeah. I would love to, I have a podcast and, a, YouTube channel, Mistake Free Real Estate. So look me up there. We do stay pretty active on Instagram at Mark Dela Torre and the same on Facebook. But, for those also, if I can just do a quick shout out, Steve.

If you're operating in Kansas City, you know, we'd love to partner with your realtors and wholesalers in the Kansas City marketplace. If you're not working with us already, please do. We are gonna be coming in and aggressively buying, and, we just love to collaborate. We're big believers in the power of collaboration, actually starting up a new, realtor, roundtable that we're hosting live, in studio at our office as well that, yeah, it's gonna be really powerful because I believe passionately, which is why the title of this, show today was so relevant that I believe real estate agents don't have the knowledge base to just confidently invest in in, real estate. And so I'm taking upon myself to coach up real estate agents who are making good money and could invest in real estate to take that first step and start buying real estate themselves.

So we're taking up that mantra and running with it in Kansas City.

Steve: Awesome. Thank you very much. Appreciate it. Thanks, Steve. Thank you guys for watching.

See you guys tomorrow.

Steve: Shout out to Steve train. Jump on the Steve train. We real estate disrupt us.