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Feb. 16, 2023

Ep 331: Leveraging Being An Agent & Investor With Matt Cavanaugh

Ep 331: Leveraging Being An Agent & Investor With Matt Cavanaugh


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0:01 Hey, welcome to the next episode of the habits podcast. I'm your host, Mr. Daniel Martinez. Special guest today is Matt Kavanaugh. We have done other interviews with him. Please go check out his other episodes. He is also the host of the Freedom chaser podcast. Mr. Matt Kavanaugh. What is your cool interesting story that you have for the for the for the group today? Let's talk yeah, 0:19 yeah, I mean, obviously, we know real estate's a crazy thing. And we were faced some challenges. So one of the challenges I faced on my first multifamily purchase was just the brazenness that some tenants have, and especially in California, tenants still pretty emboldened to do whatever they want, since they have, you know, some legislation or legislative help. So we bought this triplex a few years back. And when we bought it, we walked the property for the first time after the closing, when we walked in, before the closing, all the tenants were sweet as pie. We close, and then the lady comes out and says, Hey, you know, I'm glad you're the new owner, I'm not paying you a penny in rent, good luck. And I was like, Oh, my word. Like, I've never had a tenant problem before, like, like, especially that magnitude. So, you know, immediately I went into like, gay mode, like back in my sports days in high school, you know, it's like, after it. So it ended up being a couple of months court battle, I had hired a really, really great eviction process server that had been in the business for 30 years. So it was so cool, because what she did is she filed all the notices. She filed all the court documents, she filed exactly what I was going to say in court, and I just read off the paper, and we won. So it ended up being okay, but it was not cheap. And it took about probably three months or so. But it was crazy. The depths, the you know, because like I didn't even know the eviction process. And so I didn't know like if they filed, they filed appeals, all those types of things. So it was a it was an education in the eviction process. 1:45 100% was this. This is my my side question. Was the tenant paying with the previous owner? 1:51 No, no, they were paying speedily. 1:55 Did you get an estoppel? did? 1:57 Yeah. Yep. So the sample was not true. Okay, okay. So, so this apple, like right there, like, hey, you know, this is how much I pay per month. 2:08 This is what the tenant owns. This is what that landlord owns. This is what's going on here. I get there. And I'm like, Oh, well, and one of the things too, is that the property financials were hand written. So you and I both know, like, we get a deal. Oh, yeah. about buying a property with handwritten financials unless if it's way below market value, right. I mean, like, you probably teach this as well, like, you need a discount in some way to buy a property. It's either a discount on equity, it's a discount on cash flow, like there's some discount. That's how you make money as an investor. So it's like, okay, well, even if the rent numbers are completely wrong, we have time to evict all the tenants fill it up with what we know market rates are and yeah, yeah. So there was a discount there. 2:55 Well, I'm glad he got a discount, because that's always that's rule number one. 3:00 The best deal? Yeah, that deal was a story in and of its own, right. So that deal, we had listed that property, and it was and so we recommended a 350 list price. And they want to list at 450. And I said it's not going to sell. And they said well, will you list it for us? And because of the relationship? We're like, Yeah, we'll list it for you. But just we want to be very clear in writing, it's not selling, it's too high. So it goes on market for months. And this person, they're being drained of their their bank account by somebody else. Yeah, no. So I get a call, I'm on a trip to Maine, with my wife, and I get a call. And they're like, hey, we need $50,000 On Monday, and this was Wednesday. And so I was like, Okay, I was like, well, that's not how this works. You know, remember, we've been on the market for months, I've been advising you guys that you need to be at 350. And we could sell it somewhere around 350. And he's like, Well, now I need $50,000 on Monday. And I was like, I don't think I have an investor that will give you 50 grand in five days, like there's just too much to do. And then I said, I'll pitch it out to them. But likely, you're going to need somebody that's going to buy it at 60 or 70 cents on the dollar. That's usually what investors pay. Would you be willing to sell it at 250. If you are maybe we could find an investor that will go that fast. And they said if you'll give me $50,000 In five days, I'll give it to you at 250. And so I throw it out to my investors. Nobody wanted it because I had no in the property as an agent. I said, Look, I'll be home on Saturday. I'll walk it with my contractor if we're good. We'll put it in contract. And I'll give you the $50,000 on Monday as an early release non refundable deposit if you sell it to me at 250 and they did 4:31 that is that is a good investor agent hat switch. You did click right there. 4:36 Very quick, right? Lots of disclosure, lots of like, Hey, I understand that my property is worth way more than 250. Matt is not advising me to sell this property that is no longer my agent like, like a litany of documentation. 4:49 Though that was a good little switch right there. He did the perfect timing, man that and that's the type of stuff I like hearing about because it's one of those things where like, agents don't adapt, they lose They lose. They miss opportunity. So 5:04 that's where the question comes, like, you've probably heard this question a million times, should I be an agent or investor? Or if I'm an investor? Should I get my agent license? My answer is always yes. Like, why would you not get your agent license? Most states are not all most states are pretty cool with you doing both, as long as disclosure is very, very good, very clean. And then you get the benefit of these types of situations. 5:23 So I'm not an agent, and my partner's not an agent. And the reason why we do it is because this this came last week in this perfect example for this. So we're like, we're calling Hey, we're calling about this property. And he's like, you know, how are you? Are you the investor? Like, are you an agent? Like, we're, we're developers, we buy big land all over the city? And he's like, he's like, Oh, so you don't have an agent? You don't have an agent representing you? Like, yeah, I know, a bunch of agents. But I mean, we just call it direct. Because it I'll be, I'll be your buyer's agent, too. And he's like, You know what, I didn't even think about that. I would love for you to be my buyer's agent. And he's like, he's just got all happy. 6:01 So the owner was an agent and represented you. As 6:05 we're calling. We're calling the agent. So the agent will be on our side as agents. So we come with no agent and win them over. And that's our strategy. 6:17 Yeah. Which that has that has really value real utility for sure. I mean, like, if your strategy is is agents giving you all the deals, they're not as likely probably to bring them to you if, if you're their competition. 6:30 Yeah, that's one of the things we're like, we kind of want to move on real quick. So He's doubled his commission. He's like, Oh, you don't have to worry about the commission. The sellers gonna pay me Oh, that's, that's amazing. I didn't know that. We can work in and like we knew we knew all that stuff going in. It was just that if the agent if the agent is motivated to sell, it usually helps out move the transactions further, too. Because sometimes it doesn't close. They don't get paid. Yeah. So it's best to have some, some some some push on your side that's on your side. Totally. helps out, man. Good story. I like that one. Because it makes it better when you switch your agent hat because like I said, I don't I'll never become an agent. But yeah, that's a good story. It's a good reason to become one if you're if that's your strategy, and you want to pick up some rentals. How is it owning rentals in California, because I would never do that. 7:21 So I've sold most of them. I own my primary residence, and I own a property that allows for multiple dwellings. So I have some tenants in a property, I'm actually sitting in a shop office garage is converted into a podcast studio that's on a property where I have tenants. And so because it's so few that like, you know, I know more people that want to rent than I have places to rent, it's fairly easy to have great tenants. And so but as far as like having my huge portfolio in California, that that's not going to happen. So most of my holdings are out of state. 7:59 Now that's that's good. That's good. Yeah, I wouldn't California is a whole nother beast and like, I was so bad for like, I can't all these all these investors want to get stuff here in California, like just don't do it here. Somewhere else. 8:12 Yeah, yeah. And there are certain strategies I think are decent, like for example, you know, if you're doing like short term midterm and too loud, and it's good, and so you're not really facing some of the same rental laws as your long term stuff. That might work a lot better. But anytime you're dealing with any of these moratoriums, I mean particularly like you guys live down in Southern California and so being in Southern California like that's that in the Bay Area are impossible. Like here in the Valley. It's like in the middle it's like harder than your your Oklahoma's but it's it's it's not like you guys are moratoriums for like another year or two. 8:48 Yeah, I don't even know. Yeah, yeah, you're a land dealer. You're not landlord. This goes to this. I'm glad I'm glad you mentioned that too, is that when you get away from the cities, you get a little more flex even in crazy states like California, and it's like county specific. The closer you are to the city, there's just crazy there. It doesn't make sense to do anything here. Yeah. Well, where can people find you online? And tell us about about your podcast? 9:16 Yeah, Freedom chasers podcast. We cover a lot of different things. So we have a show where we do How to that Tim my co host runs. I do a lot of the mindset narrative like big stories, guys that are going from zero to seven figures. Freedom chasers podcast. You can find us on Apple podcast, you can find us on YouTube. And our link tree is linktree Dash freedom future podcast. So any one of those will work great. Oh, your audio is off. 9:45 But audio is off see? Go check out his episode. We're on. We're on podcast. Anthony's gonna get on soon, hopefully. And then let's get out a lot of great information. Freedom chasers podcast. We'll see in the next episode. Thanks, Matt for coming on. Yes, yep. Thank you

Daniel Esteban MartinezProfile Photo

Daniel Esteban Martinez

Host/ Ceo/ Speaker

I have been an entrepreneur since 2018. I come from a regular home just like most people. My dad worked on the roads in the Chicago area for over 30 years. He always taught me to work with my brain, instead of my body. Your body can only take so much abuse. I learned so much from my father. He always pushed me to work smarter and not harder.

I have owned and operated a trucking business for 2 years. I started learning real estate in 2019. Fell into the Data & Skiptracing business in 2020. My partner Anthony & I started Hivemind in 2021.

I have done a ton of different jobs coming up from painting, to door-to-door sales, telemarketing, truck driving, and loading trailers. What I learned most is that I want to stay in the digital business space. The leverage you can have delivering digital products to the marketplace can yield limitless possibilites.

I started The List Guys in 2020. It is a data and skiptracing service. We provide seller and buyers list nationwide. My clients have been getting great results and I am proud to help people killing it.

I started the Hive in 2021 with my partner Anthony Gaona. It is a real estate and business mastermind. It also comes with a all in one CRM, that can host unlimited websites and users.

Starting the Hivemind has been an amazing journey so far. Seeing one of our users make his 6 figure month in June 2021 leveraging our software, I know there will be plenty more to come!