The New Flip Model: 30-Day Turnarounds Without Contractors | Thomas Lehmann | EP 76

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Speaker 1 What's up, entrepreneur, DNA family? Welcome back to another incredible episode.

Speaker 1 I have a great guest with me here because as a real estate investor for almost two decades, this man has found a way to flip differently. And that is what we're going to be talking about.

Speaker 1 For all those out there that are trying to get into the flipping game, that are watching the TV shows, that are trying to build a business around flipping.

Speaker 1 My man, Thomas Lehman, is here talking about how we can flip differently. Awesome, man.
Thanks for having me today. Yeah, man.

Speaker 1 You've been around for a very long time. You and I have been in the game for we would be called the OGs.
Well, no, you're the OG.

Speaker 1 I'm under that a little bit. There you go.
I got less time in. There you go.
Well, let's talk about your experience of what we would all see on TV and what happened.

Speaker 1 And then what changed for you to find a solution for us, the act of fixing flippers yourself? What changed?

Speaker 1 What was that story like where you said there's a better way, there's a better mousetrap to be doing this type of business?

Speaker 1 2022 changed all of us, didn't didn't it totally so my business model was like most people i had the acquisition company we had people calling texting every day they found our houses for us we bought them we either rented uh renovated and sold rented them you know we buy them at the rental or we wholesaled what we didn't use but interest rates okay okay that was going to change everything and it did so that summer i had a mobile home yeah okay i was going to renovate it we had to get rid of squatters And this is a true, not you living in it.

Speaker 1 This is a true fix and flip. Yeah, you bought a mobile home.

Speaker 1 You're going to, you know, normal process we buy them we were going out there we had to get rid of the squatters they destroyed it they took a chainsaw down the center of it oh no you're you're you know like me a little older remember bugs bunny cartoon with the fleas jumping around the sheriff opens the door they want to go in i'm like nope see all the fleas jumping no no and but they took a chainsaw that taught me a process at house because an assistant and i in the office virtually

Speaker 1 knocked it down, put the whole thing in with the old one. Remember, call and get three estimates.
We had no clue. It took longer.

Speaker 1 longer i think we took it for 18 months yeah you still made 11k yeah but we'll you made right if you had a process that taught us the process you know what my payroll then was 40 50 grand a week because i had five contracting teams okay and i said that's all done soon because one interest rates were going to change it yeah you know and two i saw a simplified process to where dude you flipped a hundred homes thousand homes whatever it is contractors stink oh dude the it is literally why i'm bald i say this every time retreat mccollum told me the same thing about you yeah it's why i'm bald i'm just like dude they suck and even when they're good for a short runway yes there's a day that they break and they end up sucking and i don't know if you can ever see around the corner when that day comes no but it's inevitable they break at some point anyways keep going and so i saw a way to get rid of them because how many setup companies, well companies, septic comps are out there.

Speaker 1 If I don't like this one, I get rid of them.

Speaker 1 We did not need to have contractors,

Speaker 1 so to speak. So one of our companies, the construction company, now only does construction management on our products.
Okay. But everything is a 1099.

Speaker 1 If this well company doesn't perform, gone. Get a new one in there.

Speaker 1 And what we've learned is for us, there's a sheet. It's 22 lines.
It never changes. It's never different.
It's always these same items. You can't do that in the flip.

Speaker 1 Well, you're talking about a product. What does that mean? What do you mean when you say a product? Well, so a sheet for a project, okay, it's not going to be 200 line items.

Speaker 1 It's going to be these 22. How scalable when you know exactly what everything is going to be? You can't do that on a flip.
Very. Because you don't know.
Open your walls, everything changes.

Speaker 1 But you're talking about a manufactured home. Brand new, but brand new, okay? And that's what I was trying to get to is I want people to understand you're talking about instead of flipping,

Speaker 1 I'm going to change that game and I'm going to go into a manufacturer housing. Yes.
And it's simpler. It's straightforward.

Speaker 1 You have the known result. You have the known process.
There's very little to no variance ever. That's what we're talking about.
Yeah. I mean, you got to learn land now.

Speaker 1 You got to learn a different terminology. Sure.

Speaker 1 But everything is we do is learning curves in business. So, but what I saw was simple, easy, scalable, especially in when the economy was slowing down.
Think about it. Like we had a wholesale company.

Speaker 1 I was losing 20K a month at that point. That doesn't feel good.
No, no. Yeah.
I got to unwind all that. We simplified the whole system, the process, and our business.
Okay.

Speaker 1 And then over time, we became a manufactured modular home dealer.

Speaker 1 Because, okay, we were thinking about, you know, what people say, mobile home dealer, they're all shady. Yeah, they are.
Yeah. Okay.
You know, I'm Russian Jew. My wife is Indian.

Speaker 1 She's much more calmer than me. When they were cheating us, we went into their office.
The guy had three fingers. And when I showed him, hey, mobile home dealer.

Speaker 1 Yeah. He showed me, we're talking.
And I can prove he stole. He said, yeah, I don't care.
That's what he told me in the office with my wife there. And I'm like, you want to keep those fingers?

Speaker 1 I have a temper.

Speaker 1 You know, my wife said, no, no, come on, let's go. And we left.
And she's like, we're just going to go get the dealer license. And you can compete with him.

Speaker 1 Your wife's a smart woman. I like that.
That gave me shivers just thinking about that. Like, bro, here's how you beat him.
You don't beat him up. But isn't that how guys do you think?

Speaker 1 You just put him out of business. We took a lot of his business year one.

Speaker 1 We were right around him doing business in his county. I would sell people the home for nothing.
I would make no money just to take it out of his pocket because I don't have his overhead.

Speaker 1 Yeah, yeah, yeah, yeah. You know? Well, and he did you wrong, right? So this is a little bit like, hey, you stole, you literally stole from me.
Yep.

Speaker 1 So I'd rather make no money, serve the client great, impeccably, get good reputation and make no money on that. But just because you did me that bad,

Speaker 1 I'm going to take that client. Yep.
And now I've, like, I moved on from that.

Speaker 1 You know, I don't do, we don't do as much in that county anymore because we've moved towards central Florida a little better.

Speaker 1 But our reputation, because of how we do business.

Speaker 1 This morning, one of the realtors who's, we're closing on a home next week with her, her buyer, she told her buyer, hey, you don't got to get an inspection. We know him.
We do a lot of business.

Speaker 1 We can, I trust him. I still told him, go and get the inspection.
Now, let's rewind real quick. Let's talk about what you do.
What is manufacturer housing? What is, what is the,

Speaker 1 you know, misconception of it, right? What are maybe the myths of it?

Speaker 1 Let's talk about manufacturer housing as a whole, because I think there's a lot of people that just have an idea of what it is, but they typically I don't think would be accurate.

Speaker 1 Well, people think the old mobile homes and how they look,

Speaker 1 they're way different today. I mean, you could have them, we have one as an Airbnb today, made it so nice,

Speaker 1 but that's not our typical product. But you can go from a base unit to over here and what you see inside can be changed.

Speaker 1 You can have drywall, you can have everything you want, all the crazy showers and however you want to build them out. Nowadays, it's a freaking home.
I mean, you can have drywall.

Speaker 1 Like I've remodeled mobile homes before right it had it was always a nightmare but I don't care about the walls though right and you put up drywall yeah bad yeah yeah but even like the ceiling like it's not really connected so if you don't have a construction guy that understands how to connect the c like you're just like well there's a scene and you know some brands have a peak and that's harder but the really good ones have flat ceilings just like in home nine eight or nine feet off okay uh we we can get any of them we prefer the flat ones because then you can do box ceilings it's easier for your recess lighting and bands.

Speaker 1 It just makes things simpler for us. Right.

Speaker 1 But people today,

Speaker 1 I think now it's getting more accepted. I know just a few years ago, even me, I was like, oh, mobile homes now.
Yeah. Now it's, but that's the affordable.

Speaker 1 I think we all all, you and me specifically, because we grew up in a time, specifically me, like,

Speaker 1 I had friends that lived in mobile homes, in mobile home parks, right? Like I didn't come from money, right? That's me either.

Speaker 1 My claim to fame, right, is like i didn't now i wasn't destitute like i don't have the story where my family and i were living on the street i don't have that but i didn't come from money like i had friends living in mobile homes in mobile home parks like we would go and play in the park like but the the the idea and concept is you think you're like it's less than you're in a mobile home park you're a poor family that is just not the case and the reason why we're having this episode is to almost reframe what people think about this because i have a piece of property in pensacola you and I talked about it before this, right?

Speaker 1 Like we're likely going to tear it down. We're likely going to subdivide the lot.
Do we put two manufactured homes on there? Right. Is that now the new option versus rebuilding a full-blown home?

Speaker 1 Because what is the price discrepancy?

Speaker 1 Like based around your, I know you can't give exact numbers, but if I were going to rebuild two separate homes, we subdivide the lot, two separate homes versus putting on two manufacturers, is there a price difference?

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Speaker 3 so

Speaker 1 A county work is different because, well, for you, you're not going to have impact fees on the first lot, but if you subdivide, you'll have it on the second lot.

Speaker 1 What does that cost? For instance, Orange County, I was just running numbers today, 25K for impact fees.

Speaker 1 A lot. Yeah.
And they want to build affordable housing. But the average project for us runs anywhere from 140 to 180.
Okay.

Speaker 1 We just finished one with Alex, right, Caseda? Yeah. We were in for $165.
For the whole build out.

Speaker 1 Sold it for $269. That's incredible.
Right. That is a new way of flipping.
Right. But that's his.
So what's his expertise? Finding distressed properties. We don't do that anymore.

Speaker 1 He came to me and said, hey, let's go work on this. Off we went, right? Put it together.
You know?

Speaker 1 So what, like, now, now I want to talk about this deal. So if I send you, what would be my process? And I want everyone to understand this.
Thomas is very relatable. Like, you can reach him.

Speaker 1 What's your Instagram handle? Thomas Lehman, real estate. You know, we can post them later.
You know, yeah, we'll give you the link.

Speaker 1 Make sure to find them because I'm going to do what I think you guys all should be doing is figuring out like, hey, if I have an asset if i have this opportunity if i have this piece of land this is an option right so i give you this piece of land and what your team kind of looks at what we can do with it what it would cost yeah because my my real options here it's basically a double lot right on one correct so it's about 25 000 square feet we can break it up into two 12 000 square foot lots correct

Speaker 1 as long as the planner says we're good on that that's right we you get the planner to agree that you're subdividable one they give you the setbacks which is the distance you have to be yeah and then we just just work from there on what we can do and build out and then what's going to be affordable at the end of the sale and we look at what's selling in the area like what's the price point so in central florida market we've narrowed ourselves to um we're 270 and under okay

Speaker 1 because we've took our our volume and we negotiated prices this isn't 21 anymore where you couldn't do that right we have a volume that we can bring anywhere and say hey we're going to do 100 units this year what will you do with us how can we work better together

Speaker 1 to scale. Right? Yes.
And by doing that, now we've lowered our prices and cost. We pass that on to the buyer today because our buyer pool, as we went higher in numbers, shrunk.

Speaker 1 So let's just say your numbers are 250 up there. Then we're going to build a house that's not above that, but it's a better value for the community.

Speaker 1 We want to be better priced on market than anybody else. Okay.

Speaker 1 So.

Speaker 1 I mean, this is pretty straightforward. Do I give this to you? You email it over.
The team works on it and give us a couple of days. We'll let you know exactly what we can do and the cost.

Speaker 1 And we would have to just make some assumptions because my team hasn't called the county to say, hey, can we subdue it? Why don't you just send it?

Speaker 1 And we'll like, we do that really well because we don't never call. Yeah, we don't, we don't never take a call with them.
We want it all in writing.

Speaker 1 Because, you know, even in writing, it's, it doesn't guarantee anything. Oh, bro.
You're telling the city. I'm dealing with a.
You're telling me about these sittings. Yeah, not a problem.

Speaker 1 That's totally acceptable. We go do it.
The inspector comes and says, who told you that was going to be acceptable? And you're like.

Speaker 1 We're going to to a hearing on monday a lawyer is uh we were told we could put a replacement manufactured home down two days before delivery they sent an email saying hey we made a mistake and you can't

Speaker 1 so it's like what well that mistake is is a costly mistake exactly now we lawyer it's going to get grandfathered in but now it took 10 weeks longer but i had to go to my lender who lent me everything and show him and he's like hey what are you doing i said oh i'm taking the unit over here because we're volume i'm going to put it it on this one i'm going to take the money for the unit i'm going to put it back in your account so it's good he's like okay cool that's all he said done

Speaker 1 his lord is my lord the same the same lawyer so we're good yeah so in my case i would literally allow you to kind of and by the way i'm i know you so i'm practically text you but you'll call the city you'll email them we'll email them right but you guys will actually handle it and figure out what is going to be our best case scenario and that way it takes that need because otherwise i have to put that on my team that might that's not their expertise that's right and it doesn't generate us revenue so they're gonna go like generate revenue like the operational right

Speaker 1 and and they're like this is some operational thing that I would give to my opera but you get my point is but your operations manager doesn't do new construction homes right so they're just gonna get an answer and be like what do I do with this and then I have to go send it to you and then so now if you just do that for me then I don't have to go send it to you to go and I have now that we're talking about this this is a fun episode guys I have two properties I'm gonna give you

Speaker 1 because there's another one that is a fourplex

Speaker 1 that I think we would need another almost 200 grand to finish out.

Speaker 1 Well, if I can build a brand new asset for the same dollar amount, I mean, you just said you and Quesado did it for 100,000.

Speaker 1 No, no, 164, 166, right? Then I just got to think about maybe there's the same play. We could subdivide that lot if it's big enough.
Yeah, they did. Same idea.

Speaker 1 They just sent me, I'm, they were had a meetup, whatever, last week, and I went out to his office and uh, or the floor underneath his office. Yeah, I haven't seen him in a while.
So, I show up, and

Speaker 1 Anthony's like, Hey, we have this lot and everything, but I'm trying to figure it out. I'm like, dude, can you just send it to us? Like, you take so turtle long, right?

Speaker 1 Let us just, and my assistant reached out and said, Give us the information. He's like, Here you go.
We got it today.

Speaker 1 It's in the inbox already this morning because he just gave it over like a day ago because he was trying to figure it out.

Speaker 1 Dude, go, go, do what you do, give us what we do because we're trying to subdivide this lot into eight lots. When you think about affordable housing today,

Speaker 1 you know, when you were flipping homes probably in vast numbers, that wasn't a sexy play at all. No, not at all.
Okay. But in this market, it is because people need a home, buy a home.

Speaker 1 If you have a seven, $800,000 home, maybe you don't buy it right now at 7%.

Speaker 1 I will, I just connect you with my general manager right now on this episode. This is why everyone should have a podcast, by the way.

Speaker 1 Because if I don't have a- My lady is screaming about doing a podcast. She's like, you got her, dude.

Speaker 1 If we don't do this together, I don't know whether I'll remember. I know what you do, but I don't know with all the things I'm going on.
Oh, man, I got to remember to reach out to Tom.

Speaker 1 You know what I mean? But now I'm sitting here, but now our team will handle it. That's right.
Okay. Now, I just connected you because I don't know your team, but I don't look at email.

Speaker 1 They do, but no, no, no, I text you. So

Speaker 1 add your assistant into that thread. Okay.
Yep. And then Anthony and your team will take it from there.
Yeah. And, but see, isn't that what we're supposed to do?

Speaker 1 Like, we have to have people handle that for us.

Speaker 1 Because if we do, we're not doing what we do, which isn't revenue. That's right.
You know? And there's so many, you know, know it's funny in talking about being a CEO and entrepreneur

Speaker 1 we may not have to be in the trenches doing the smaller things like hey let's go do the but what you and I have to go do have the bigger problems the bigger issues the bigger growth the bigger trajectory the bigger

Speaker 1 and so a lot of people want to be the the president the owner whatever but you got to understand we may remove ourselves from the tactical small thing that's different the things that come to us though oh yeah those are the uh the city actually

Speaker 1 like less hair and stress and insomnia. We talked about it.

Speaker 1 Not sleeping well and just staying up. I mean, I have an event that I wanted you to be at.
Unfortunately, you could, but like Easter. Yeah.

Speaker 1 Dude, I'm in vent mode. Like, I am going.
Of course. Dude, my wife is like, why can't you sleep? Because I'm flipping around all night.
Last night.

Speaker 1 I'm like, honey, we are going to crush the next two days. I can't sleep.
Yeah. But your team is handling a lot for you.
And that's the benefit of it.

Speaker 1 You know, one thing that, you know, you had my coach on here like a month too. Gary.
Gary Harper. I love this man.
I told him to be at the same event. I'm like, get in the room, dude.

Speaker 1 More people need what you got. And unfortunately, they don't know him as much, right? That's what he needs.
He's a mate. Let me tell you something.
We are 20% or more of Central Florida's market.

Speaker 1 50 to 30, okay, 30, 40% in Pasco Hernando, 50% in Polk County of all the new units going down in Central Florida. Okay.
Because of his company. Because I went to him.

Speaker 1 I kept hearing Tiffany High and all these other people. It was like 1-800 call Gary.
Who the hell is Gary? 1-800 called Gary. I love him.
I joke about it.

Speaker 1 But then he came to Florida and he met me on a Saturday morning because he's a Disney guy. I'm not.
But we had coffee. He had all the answers with, he looked me up.
He said, you're experiencing this.

Speaker 1 And he's big into that PI.

Speaker 1 And I took it. His son, Jacob, couldn't get me to take it until we had an appointment with Gary.

Speaker 1 So I took it the night before, but using that, he described the me, what he read in there.

Speaker 1 Because in our business, we have to be social.

Speaker 1 People think I'm a social social animal. It's not my thing.
I don't need to be for me. If you put me in my house for a week, I'm good without talking to anybody.
He's like, and he said, you're a cat.

Speaker 1 I'm like, okay, what do you mean by that? You know, he's like, you want to get scratched, you'll get scratched, but you don't need it. Yeah.
And then I bought into it because that's me. Yeah.

Speaker 1 Right.

Speaker 1 And he's never steered me wrong yet. He, well, he was one of those people.
I was like, bro, get in the room for this exact. His value of what he does is so amazing.
Yes.

Speaker 1 But genuinely, no one knows about him and like story is fascinating let me let the best of the best show you how to build out this sequence of your content yeah so everyone knows and then you hand choose who you want to work with he's the one who got me on tick tock he challenged me in october to do do this right i got my first viral vid out of it nice um like five eight thousand followers all organic yeah okay

Speaker 1 uh

Speaker 1 and now we were arguing because we had a bet he's like i'm not doing it anymore i'm like oh because you lost yeah Yeah. Yeah.

Speaker 1 But his team's amazing. They take care of you.
So it's great. Yeah.
So

Speaker 1 being that you're now kind of reshaping how things should go in real estate, because I think the thing that has kept me in this business for almost two decades is being adaptable. Yeah.

Speaker 1 Iterating, right? The reality is I got in this space in 2007 when the economy was going south, right? Like hardcore. I was a victim of that, right? I lost my home.
I heard the story.

Speaker 1 The car different stays with your buddy. But through that trajectory of two decades, things have changed.
I was buying homes at auction. The hedge funds came in, bought 110 cents on the dollar.

Speaker 1 I had to buy 80 cents on the dollar. So, how am I going to compete? Well, I have to iterate.
I have to change. Yeah.
Same thing we're talking about here and why this is so important.

Speaker 1 If anyone's going to be in the space of real estate,

Speaker 1 they need to understand this can be a new vertical. I'm literally real time right now.
We just put our team together to look at a deal that I already own

Speaker 1 because I need to be able to iterate. That might be just a better way to go do more deals because the cost of it.
Exactly.

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Speaker 1 Everything we do costs money, but that is normally our biggest expense in real estate, isn't it? Going to get the money.

Speaker 1 And so you need to be profitable. With flips, the problem is you have to wait to list it.
Yep. You don't know what's going on until you open the walls.
With this, it's different.

Speaker 1 We don't run into those disasters. What is now it's totally financeable now, right? Because I think, again, let's play.
100%. There's a lot of myths.
And they're not really myths.

Speaker 1 I think there's just misconceptions. I think.
I think there's idiots out there talking crap all the time. Excuse me if that's the wrong word, but it's true.

Speaker 1 Cause like on Facebook, people say, oh, but you can't finance. What are you talking about? We sold 76 last year.
Right. Two conventional loans.
Yeah. The rest, FHA, VA, USDA.

Speaker 1 What are you talking about? And so let's bust the misconception of what isn't financeable, right? So that people are very clear. There is a section of this industry.
Old ones. Correct.
Old ones.

Speaker 1 So let's talk about that.

Speaker 1 So people are very aware of what we're what they're thinking is the reality versus what is reality let's talk about the old ones what that looks like let's talk about what we are talking about what you are doing and kind of so people are very clear on the difference so what we only do is brand new okay okay we our license allows us to do use but it takes away from my core which is new okay and different animal so brand new manufactured the majority 98 are double wides okay some triple wides less single widespread what's the biggest size like i don't even know that answer.

Speaker 1 Like, what would be a triple wide? What square footage would that be? Oh, man, over 2,000 plus square feet. Because it's basically just three sections.

Speaker 1 And you can put, like, it's, it's, think of Legos, right? You have two here and you attach one here or over there. We're doing one as an ADU for somebody right now.

Speaker 1 They want their mom living over on that side. Freaking freaking brilliant, dude.
I mean, there's a lot of people that need to consider that. Yes.
Because you know what?

Speaker 1 He was doing it with a different company and they wanted separate. Then you have to put two separate systems for septic and whales because you can't tie them together.

Speaker 1 If I do it as an ADU and I attach it guess what it's one yeah save them a ton of money okay friend of mine you know called me up and i'm like dude i got this for you relax yeah okay that's brilliant and i did it on the um

Speaker 1 the transport from the hotel to the bright line station yesterday for him well it all worked out okay bright line's great by the way never never driving again now never after that right was that right

Speaker 1 oh no oh yeah no never learns amazing and then you work and then you got uber right and no parking but we'll get back yeah yeah yeah um but brand new never a problem problem with any financing or insurance.

Speaker 1 Single wides are a little different. There's less, say 70% of all the financing works on a single wide.
Okay. Okay.
But usually pretty good.

Speaker 1 People just have to know that. Double wides and triple wide.

Speaker 1 Yeah, it's just a single kid. Yeah, yeah.
Not a problem, but less financers, less banks, less financial institutions. Yes.

Speaker 1 I mean, you can get an FHA VA, but some of the programs, like the down payment system, do not work on them. Got it.

Speaker 1 But like Hometown heroes which was big in florida okay all worked on double wides we sold a ton that way okay and so

Speaker 1 how big can they go the new ones like what is like i don't know i mean we can go 4 000 square feet they have two-story ones you can and you can get all that i could order it yeah i don't i don't normally i haven't done a two-story or that big because the lane for us with what we do as our bread and butter is affordable that wouldn't be affordable that's right would we build it for somebody who came in sure like we've done construction to perm for people yeah because we can get a finance for that.

Speaker 1 We can say, okay, how much do you, what are you looking to spend? Okay, we're going to build it out. This is what it is.
We go and get them a construction loan. Yeah.
Withdraws. Same way.
Yeah.

Speaker 1 But now I'm using their money and not mine. I don't have to charge them more then because the interest isn't there for me.
That's right. You know? That's incredible.

Speaker 1 And so now what is, so the new stuff's totally financeable. You could get up to 4,000 feet if you want to, but the reality is most people will get like a double wide.
Maybe you get a triple wide.

Speaker 1 How often do you get the triple wides? Twice. Okay.
Nope. So

Speaker 1 typically double wides, right? Which is what? 1500 square feet? So the bread and butter, what we're putting down on an acre is about 1,800 square feet. Okay.

Speaker 1 But what we've done, we've taken our volume and we went to another manufacturer and negotiated better terms to bring it to them.

Speaker 1 And now we're selling more, bigger units for less price, which helps our buyers right now. Of course.

Speaker 1 This economy, we have to help them.

Speaker 1 And 100%. So if I'm the buyer,

Speaker 1 let's work this through. I already own the land.
Your team figures out, city says yes, you can subdivide it. We need to sign these docs.
Great. Now you have two parcels.
Yep.

Speaker 1 The financing of said manufactured home. Do I need to pay out of pocket? Is there financing to purchase it? How do I finance that from you?

Speaker 1 We now, because we have the longevity in, can get people finance for the units through the major lender, which is Triad, which is essentially a construction loan. Yes.
But if you own the land,

Speaker 1 I did the land as security to them.

Speaker 1 They will, I mean, it's a construction loan. I mean, that's what it is.
It's so simple. And they will do, I think it's 135% of the unit value, which gives you a lot of your infrastructure.
Right.

Speaker 1 So your cash in is so much less.

Speaker 1 I mean, drastically. I mean, to some extent, it could be zero.

Speaker 1 It could be because they, well, you have to pay interest payments for whatever they start 60 days after delivery. Okay.
But as long as you're cred, I mean, so the.

Speaker 1 If you have a 650 or above credit score, the numbers are good. They'll work with 550 and above, though.
Now,

Speaker 1 delivery means

Speaker 1 put together. No, so delivery just means it goes from the factory to the lot.
Then you have a setup company who puts it all together. How long does that take?

Speaker 1 In the olden days for me, up to 78 days. Now that we are operationally efficient, thanks to those other people we talked about and not me doing it, 24 days.
Let's round it at 30, whatever.

Speaker 1 Yeah, but look at that timeline though, right?

Speaker 1 78 to 24. We just discussed it this morning.
Yeah, there's no, I mean, you can't do that. You can't build a home in 78 days.

Speaker 1 From the day it was delivered, 24 days later, we have now our CO and we can, we've already had it on the market. Now we can close.
Okay. That's amazing.
So I'm already marketing it.

Speaker 1 I'm already finding buyers. We can close.
Well, you have the dirt. You're listing new construction.
Yeah. As soon as you know what unit you can put down, you can list it.
That's it.

Speaker 1 We can't do that with a flip. That's right.
Ah.

Speaker 1 So you're already finding the buyer. It's like reverse.
It's like Kent Clother's whole reverse wholesale model, but now you're reverse flipping model. And yes.

Speaker 1 and what if you put in, you build urgency and say, hey, look, we're going to build this unit here.

Speaker 1 But if you want to, if you want to live here and you want something different, if you do it in this timeline, you let me know. We'll change it.
I'll go shopping for you. Yeah.

Speaker 1 So you build the urgency in the people because then they'll just say, oh, if we can't do anything, we'll wait till it gets there. Yep.

Speaker 1 And look, in this business, we want to have a contract on a home and the story. Right.

Speaker 1 And that's what our business model is. So we have ways to show them the unit, 3D walkthroughs.
We have units all over Central Florida down. They can go walk and see the same unit.
Okay.

Speaker 1 Man, this is, it just relieves. So, but

Speaker 1 you said 30 days or 60 days after delivery, the right now we're on 20. Okay, for the financing.

Speaker 1 Yeah, it could be. So if it's for me as the business, I'm 30, but I think the customer is 60.
Okay. Right.
So because it's different. It's already built.
Yep. We've already been marketing it.

Speaker 1 I mean, in a perfect world, we sell it within 30 days. They close within 30.

Speaker 1 There might only be two months of interest payments i'm on the hook for in a perfect world i get our life is imperfect but i mean that's reality right yeah it's ordered they finance it it gets delivered it's turned in 30 days let's call it 24 technically but 30 we find the buyer because we're pre-marketing it they close another 21 days later 21 30 yeah so you know Am I off on any numbers?

Speaker 1 I'm just trying to do that. My cash conversion cycle is 180 days on a project max.

Speaker 1 Right. Okay.

Speaker 1 So it's different for if you own the land already that's from the day we start the process and finish okay so we should be 90s max okay it's different if you live in it because now um you're an owner's permit versus a builder's permit it becomes it's easier right because it's your land you know we're still doing the work for you and they just essentially give me a construction loan i mean this is

Speaker 1 somewhat of a no-brainer but it's

Speaker 1 price off like i wouldn't buy a 1975 home and then tear it down per se this is what do you mean I do? That's our one of our we buy a ton of old homes. You don't have impact fees anymore.

Speaker 1 So the last three deals in Orlando were all old units. It cost me $5,000 to knock them down.
I don't have to pay $25,000 in impact fees.

Speaker 1 But you just have to buy it at the right price to make that make sense, right? Look, we make our money when we buy. That's right.
But we don't market anymore. I work with people like Alex

Speaker 1 with Brandon Schwamm and all them who that's their business.

Speaker 1 How do you work with Alex? Is it more of a partnership of sorts?

Speaker 1 or is it we partner on it here's it let's go right you know put it into the pipeline because he partners with you know alex is a real smart person i i've known him for years and i've watched his just trajectory sure he's going to be here by the way oh yeah you said you'll be great because he's on that like i need more content where i'm like bro get in the dirty yeah and uh you know but he's one of those people who knows that this is my vertical oh call tom boom called me up we negotiate he's a hard negotiator right yeah there's no we made the deal and uh it worked out well so what would a deal like how would you play a piece in this?

Speaker 1 Like, I already own the property. You have the manufacturer.
Like, would there be a reason that we would do it? I mean, you could hire us just to manage it.

Speaker 1 I would suggest that since you already own it, right? But if you're buying stuff and we partner, it's different. And then every one is different as we look at it.
Okay. Okay.
So.

Speaker 1 Yeah, I think the economics, I would have to understand more about like on whether we would other properties that we don't already own to understand like what do we need to buy at so financially it can make sense for us to build these things.

Speaker 1 And we'll look at your back end, what's selling in the area. See, I don't look at land value yeah until i'm i work backwards okay if my comps say i can get this what are my costs

Speaker 1 and then what do i need to do for the land because you know there's things we'll overpay for city water store every day yeah okay because you don't need permits septic and well can be thirty thousand dollars easy easy yeah so i'll overpay for that lot if it connects to the city for both of those because i change my timeline and my cost

Speaker 1 um so you know remember i i buy from a lot of wholesalers and i always want to to see their contracts. Yeah.
And I'm like, dude, I don't care what you're making. I want you to make money.
Sure. Okay.

Speaker 1 I just want to make sure you don't have some crazy claws in there that I got to, I just told the guy, but I'm not dancing on the table naked at closing day. Yeah, yeah, because I'm agreeing to it.

Speaker 1 How do you know this? I dude, I've done that business. I want you to make money with me because guess what? You're going to bring me more stuff.
That's right. Right.

Speaker 1 But we educated a bunch of people, wholesalers, on how to negotiate the septic cost, the well cost, because there's a map called the B map in Florida now.

Speaker 1 You put in the address, the darker the color gets, you go from like yellow to purple.

Speaker 1 You go from a $5,000 system to a $25,000 system. And if you don't have that information, how can you negotiate with the seller?

Speaker 1 What is

Speaker 1 what are you finding on your own deals? Is the right buy price typically? Like, is there a range like if you want to stay under $100,000, you want to stay under $200,000? On land?

Speaker 1 Oh, man, land, you know, like... Well, when you're buying, so with intention to put these things.
Yeah, I mean, so our, we've paid as much as 90 for land. Okay.
But it was in the right area.

Speaker 1 I know what the back end numbers are going to be. And so what did Alex contract the deal to it? You know, I mean, he got it for like 29 grand.
Okay. Yeah.
So you want to, you want to be low.

Speaker 1 But his was an old unit. Just so you know, lots in the same neighborhood, vacant lots, are selling for 39 grand.
He got the old unit for 29 grand.

Speaker 1 Yeah, but he had a different exit than everyone else would. But but we didn't have to pay in what a great deal.
See the value of the partnership there?

Speaker 1 He did his expertise, which is find distressed properties at a discount. Right.
And then what did you bring to him to figure it out? No, he brought it to me.

Speaker 1 I said, perfect, because the land selling for more will save on septic, well, and impact fees. It's like a $40,000 swing.
So let's say we walk away with whatever it is.

Speaker 1 It just paid for itself to split it up already right there using their expertise. We don't do that anymore.
And we were never as good as him. Sure.
Okay.

Speaker 1 But why do it then when I can partner with people? Yeah. We don't market anymore.
Yeah. Zero.
Zero marketing dollars.

Speaker 1 I mean, that's the reason why I do the same thing, the reason why I'll buy from my students. So I've created a ecosystem that you know that I'm helping them get deals.

Speaker 1 The reason why I want to help them

Speaker 1 buy it from them. Of course.
Right. And by the way, they make a full assignment on their side.

Speaker 1 So as an example, if they go, if I help them get one to the main street and we would technically wholesale this out for 20 grand, but I want it. They'll still make their 10 grand as an assignment fee.

Speaker 1 Nice. Because I want them to win and then I'll buy it and then do this, right? They don't have to be a part of it.
Right.

Speaker 1 But that's building the ecosystem. That's right.

Speaker 1 You know, and I've learned that from you and others that I've networked so much in my area to where I've trained people, taught them how to go find the land for us. Yeah.

Speaker 1 But we're in masterminds together. And, you know,

Speaker 1 this is my vertical. Some people who don't play in this just bring me the land now to partner.
Okay. That's right.

Speaker 1 Because I think that as we

Speaker 1 grow in real estate, we go from being competitors to collaborate, right? We collaborate more because different expertise. Yeah.
The immature people still compete. I'd rather collaborate all day.
Yeah.

Speaker 1 I'll make more money with people than I will without. Yeah.

Speaker 1 And you stay in your lane. You're like, I do not do anything that doesn't contribute to my core.

Speaker 1 And some people want to do wholesaling on scales, you know, whatever, eight states plus new construction. It's like, dude, how can you do it all? You know, it's funny.

Speaker 1 And every time I get, i don't want to say too big for my bridges but you know i take some big swings sometimes supposed to there there's always that like oh i am out of my depths right like this is new yeah but i've also done it a long time that i can recalibrate and i can fix and i have a team yeah but to your point most entrepreneurs that like they get a couple bucks in their pocket and now they're doing something else and doing over there and shiny objects and you just go why just be really great at the thing right and when you make enough money

Speaker 1 then you can go all right i'm gonna take a swing at this thing over here. But even, you know, look, everything we're doing now is adding the other verticals to contribute to our core.
That's right.

Speaker 1 We're going to own our transport company. We're going to own our septic company because we can shave timelines down.

Speaker 1 A guy who was going to lend me money, he is lending me money for both septic and transport. I explained to him the process, how we would shave this much time off it.

Speaker 1 And with septics, let's say we're doing 100 deals, we wouldn't use it 50 times.

Speaker 1 But with the transfer, I mean, with the setup company, we'll use it 100 times. He's like, Oh,

Speaker 1 yeah, good. That's all.
That's all he had to say because he's done business with me before. How much do you need and win? I love people like that, right?

Speaker 1 It's incredible because he's going to make money. He can't do with his IRA money or whatever it is, what I can do for him.
Yeah, he doesn't want to either.

Speaker 1 He's like, Dude, I don't, you know, I'll go see your property like our deals one time. Maybe do you have a better place for people to kind of check out more?

Speaker 1 Because I think people are, yeah, the website. We can lift it all up.

Speaker 1 What's the website? It's the property solutions team dealership.com. The property solutions team dealership.com.

Speaker 1 Because I know a lot of you watching this and listening to this are like, this makes a lot of sense. I just need something to look at, right? Because you and I get it.

Speaker 1 We've done this a long time, but someone might be like, man, I have this inherited property I have and I don't really even know what to do with this.

Speaker 1 They should be calling Thomas, right?

Speaker 1 That's what I'm trying to get to for everybody is this doesn't have to be a business for you.

Speaker 1 But all of us to some extent have a component of real estate, whether you inherit a property, you own your own personal property, you are are fixing flipping.

Speaker 1 Like this is a vertical that just financially can make sense a lot of the time. Yes.
I see people moving. Like we, we teach people how to do this as well.
Yeah.

Speaker 1 We slow down on the coaching because we are adding the verticals, but I also hired new operations managers and I'll go back to it more in June. I kept some of my students, one who wasn't performing.

Speaker 1 We just said, hey, you know what, maybe it's best both of us go separate ways because you're not doing anything. I don't want to take your money either.
Yeah, yeah.

Speaker 1 But, you know, anybody who's going to build affordable housing, I'm going to help. Okay.
I had meetings here yesterday with people who do it. Yeah.
Okay. This area needs it.

Speaker 1 I mean, there's nothing affordable here. Well, yeah.
I looked over their systems and, you know, the husband, wife, and the brother came. We sat down and they came to one of my events last year.

Speaker 1 So I'm here. I met with them.
They showed me what they're doing. And I'm like, why? And I showed them our whole process.
I gave it to them. Yeah.
Right.

Speaker 1 What a thank you because you're going to go build affordable housing. You're going to help people.
Yeah. But if I help you, then you help them.
That's me helping them who are good. Right.

Speaker 1 Ed Milet said that at the last board. Dude, I love him.
I mean,

Speaker 1 I almost gave all the money to go to go to his house, but my wife said no. That's it.
That's right. That's right.
Well, dude, thank you for coming on. Absolutely.
I really appreciate it.

Speaker 1 I want everyone to start following him on Instagram, Facebook, TikTok, LinkedIn.

Speaker 1 We'll post it all in the show notes, the website in the show notes. Yeah.
I appreciate you coming by and following me. Oh, man.
Thanks for having me, bro. Yeah.
All right.

Speaker 1 If this was pretty cool and you think there's some people that need to know this and you want to share it, please do. Share it with at least two of your friends.

Speaker 1 Make sure you follow Thomas and we'll see you on the next episode. Thank you, everybody.
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