Category: Podcast Episodes

Caryn Prall oversees 800 brokers at Keller Williams, many of them top producers. She has incredible access to the most successful brokers in the Chicagoland area and today she’s sharing this wisdom with you. In our conversation Caryn talks about what separates the heavy hitters from brokers who struggle, including running a P&L statement and setting up an S Corp!

Caryn Prall can be reached at 630-901-3454 and carynprall@kw.com.

Transcript

D.J. Paris 0:15
Hello, and welcome to another episode of Keeping it real. The only podcasts made by Chicago real estate agents and brokers for Chicago real estate agents and brokers. My name is DJ Paris, I am your host through the show. And couple of quick announcements before we get on to our interview with Karen prom. So a couple of things. First of all, we are nearing our 50th episode, and we could not be more thankful that you are listening. Because when I started this, which was about I don’t know, maybe six months ago, I thought it was a good idea. I thought, boy, if I was out there producing as a broker, I would want to know what the top producers are doing. And that was, it was really that simple. And then thankfully, not only did top producers want to talk to us, but then people wanted to listen to what they had to say. So we are going strong, we have about five episodes recorded in the last week that we need to push out. So we should be pretty busy. But again, the best way you can support us is to continue to listen, of course, let us know what we can do to improve the show. And I’m going to mention a couple of great suggestions in a moment that led to some really cool announcements that I need to share with you guys. But those came from our listeners. And then of course, share this with a friend, there’s 42,000 realtors in the Chicagoland area. And we would love to have all of them listen to an episode, we’re not selling anything. There’s no promotion here, we are literally just showcasing top producers and what they do best, and it’s really a lot of fun. So let other brokers know in your office or that you meet out there that that if this has been helpful for you. So I had a great suggestion from a broker who listen to the show. And it took us about a month to get this going. And I can’t completely announce it fully. But I’ll give you the gist of what’s coming. We are in the final stages of working with a coaching company to have one of their master trainers do a monthly episode. Let me back up a moment. So many of the people that we’ve interviewed these top one percenters have coaches in you’ve probably heard that if you’ve been listening, they hire these professional real estate coaches. And there’s several great training companies in this country. Well, one of them, one of our brokers, sorry, one of the listeners reached out and said, Boy, you know, listening to these top producers is great. But I would really love to know what these coaches are telling them to do. You know, so we thought, Oh, that’s a really good idea. So we reached out to several of these training companies. And we found and we partner found when we could really partner with so once a month, starting in the next week or two, we’re going to have a one of their master coaches come on the episode and do a full episode of what they tell top producers. And we’re going to do that monthly. So what a great suggestion didn’t occur to me. And as soon as it came through our email, I was like That is brilliant, right? So any time you guys have ideas like that, and by the way, here’s some other ideas that we’ve made into monthly episodes. We have the Monday market minute with Carrie McCormick, which is one of our highest listen to episodes where she shares what’s happened in the market in the past month, what’s going on in the future. From a top producer, we have our investor insights, which is a monthly pod monthly episode for investors with Eric Workman, which is awesome as well, for people that are brokers that want to work with with investors. How do you do that? Right? We’re going to now enter this coaching episode, which we haven’t titled yet, but we’ll come up with a fun name. And then lastly, we’re going to have a lender come on every single month and talk about what brokers need to know about what’s going on in the mortgage world lending rates products. So you can stay abreast and keep your clients in the loop. Okay, that was a really long intro, and I apologize if I bored you to death. But we’re really excited about this, this little show that now has 1000s and 1000s of listeners. And today is a great example of sometimes we we go we do a little bit of a different type of show. And this one, I think is so great, because we have Karen PRALE on and we’re about to introduce her in a moment. But Karen is really interesting. She’s great in and of herself. But what we love why we’re so lucky to have her on the show is that Karen actually oversees over 800 Realtors for Keller Williams out in the western suburbs. So Karen works not she isn’t just a top producer. She works with most of the top producers out there, because so many of them work at Keller Williams so she has so much insight and just knowledge and wisdom about what they’re doing. So I couldn’t be more grateful to have her on the show. We’re about ready to get to her. So again, thanks again for listening. Thanks for indulging me in this long intro. Hopefully I didn’t bore you too much. But it is I wanted to share with you guys some of the things that are going on in the show and again 98% Of all the stuff we do is because you tell us hey talk to this person or How about this idea? So thanks again keep those suggestions coming share this podcast with a friend and onto our interview with Karen ball.

Okay, today on the show, we have Karen PRALE. From Keller Williams and Karen has been in the real estate business for 22 years. They started as an assistant and she went to to be a buyer’s agent. And from there to a team, to an individual agent to a leader with Keller Williams, she and her partner now lead over 800 agents. And we repeat that 800 agents and staff in four offices in the western suburbs of Chicago. Thank you, Karen, so much for being on the show.

Caryn Prall 5:51
Well, thank you DJ, so much.

D.J. Paris 5:54
So tell us how you got involved in started in real estate.

Caryn Prall 6:00
I got started in real estate, I was a receptionist at a REMAX office when I was 1516 years old. And I realized I love real estate because my mother has been a realtor. She’s on her 42nd year in wheaton Glen Island area. And my sister’s an agent and my grandmother, her mother was also a realtor broker.

D.J. Paris 6:19
It’s in your blood,

Caryn Prall 6:20
it’s how can I not do it. And I as I was going to college in Ohio, and I was in a restaurant business, and I loved opening restaurants. And I’d go and it was like being an orchestra conductor. And it was really exciting and fast moving and multitasking. And I loved it. And I realized one day no judgment against restaurant people because I was one. I didn’t want to be a bartender at 40. Right? That seemed painful for me. And I thought, Well, I’m just gonna go focus full time on real estate. So I did that about 18 years ago, and had not looked back.

D.J. Paris 6:59
And you know, and now you have such a massive organization behind I mean, you’re with Keller Williams, but you have 800 agents, you know, sort of under your umbrella to talk about, tell us a little bit about, you know, why you decided to switch to to more of the, you know, helping the broker side versus, you know, working directly with clients.

Caryn Prall 7:22
I realized that I love leadership, and I love developing people and seeing someone succeed or hearing their story or watching their life change, because the work that they did, fulfills me. And honestly, I cry probably every day to hear an amazing story and just being able to impact the most amount of people. And it wasn’t for me, the money was better honestly, buying and selling real estate. I mean, I would guess 30% of my agents make more money, at least that I do. It was the leadership opportunity and to grow people. And I just have a passion for that way more than ever showing a house again.

D.J. Paris 8:02
Yeah, let’s, let’s talk about that. You know, I’m a huge, huge fan of Gary Keller’s Millionaire Real Estate Agent, of course, it’s the seminal work. It’s, you know, if you if any broker out there is listening and really wants to, if you only had to read one book, that’s probably the book to read. There’s lots of others. But that’s that’s the one. And it’s recently been updated. And a Millionaire Real Estate Agent. And he’s got other books as well. But talk a little bit about, you know, what you’ve seen from some of the top producers like you and I were talking offline about some of some of the top people at Keller that we both know, here in Chicago in the Chicagoland area, you know, what are some of you we were talking about treating it like a business, you know, treating your practice as a business? Can you talk a little bit about that?

Caryn Prall 8:49
I think that Realtors naturally are entrepreneurial, because they want to be their own business. That’s why they choose real estate. And they also don’t know how to run a business. So I relate it to doctors who joined large organizations, like, you know, to page Medical Group or other companies is that the doctors want to go practice medicine, they don’t want to operate the business. So I think there’s two types of people out there selling houses. There’s realtors, and there’s business owners. And I found that it is no longer how long you’ve been selling real estate. It’s how many units you’re, you’re pushing. So you and I talked about that gentleman from properties that had closed 73 transactions. That’s amazing. We had someone that close 41 in their first year and her experience and knowledge is decades above an agent who’s selling two to three homes a year that’s been doing it a long time. It’s just a very different mindset. So it’s about a business, a profit and loss statement. overhead costs, expenses, and netting the most profit for what you want out of life, which is probably providing for yourself and your family.

D.J. Paris 9:54
Yeah, I mean, what do you tell new brokers when they’re just getting started? Obviously Lee, they’re trying to get the word out, you know, I, you know, I’ve always subscribed to like the Brian Buffini model, which is just paying meet two to five new people every day, tell them what you do and stay in touch with them. Which is, which is not easy to do, but is a pretty good idea. And I was just curious on some other techniques or strategies that you recommend to the brokers who are really trying to take it to the next level,

Caryn Prall 10:27
I think when you’re getting started, don’t be a secret agent. Everybody I knew was a was a potential customer for me when I first got into real estate, and I sold houses to all my friends. And I did it because I cared about them. And today, they’re selling those houses, making hundreds of 1000s of dollars to put down on a dream home. And so we really can affect and change someone’s life by selling houses. But like just you said, Buffini is a good program. And when you’re meeting people, my goal is I had to add nine people to my database every day. And that’s I love that. And that is the MRA. So you’re right, I was given that book, I wasn’t always with Keller Williams, I’ve been with other companies that are good companies. And, and I was given that book. And to me honestly, it read like a technical manual. Like I am not a reader. I’m a listener. And so they didn’t have podcasts back then like yours. And so I had to read it about six, seven times to really understand what they’re talking about. And we are in the people business. And it’s a statistic. And for every 10 people that you know, you should be able to create one transaction out of it or two now. And it’s changed so much with the internet and the availability of information. And we no longer the keepers of all the information that’s out there for buyers and sellers. So we just have to show our value proposition all the time. It’s a constant struggle.

D.J. Paris 11:49
Yeah. 100%. And I I’ll tell you, I have two great Keller Williams stories from one from Nikko apostle. So if you’ve already listened to the eagle apostle episode, you can skip ahead, and then one from from an upcoming episode that has not yet aired. But would Niko did something very, very interesting. When he first started, I just want to share this in case someone’s listening who hadn’t yet heard this. heard this. That episode, he went around and he was young. Then he was a young man. And he said no. Yeah, super young. And even though his mother, of course, it has, you know, this legacy in real estate. He said he was none of my friends were buying or selling homes. I didn’t know anybody. I didn’t know what I was doing. And he said, but I wanted to know just stay busy. So I went up to and this is such a simple thing that really, most brokers could do at any firm. And most brokers will never do this. But he said he went over to brokers who had listings in his case, Lincoln Park was his where he grew up and where he wanted to specialize. So he went to brokers who had listings there. And he said, Hey, I will do an open house for you any day of the week. And you know, just because I want to appear busy, and I want to try to meet potential buyers. And not only did he do that, because that’s in and of itself, you know, not that unique, although it is certainly a good idea. And then the second but the second part of what he did to really drive it home is he said I knew nobody was going to show up because that because none of my friends were buying I didn’t know anybody. He said so I went an hour ahead of before the actual open house would start and I’d knock on every neighbor’s door and politely introduce myself and say, hey, just in case you ever wanted to come over and see I you know, I’m running an open house for so and so down the street. And you know, neighbors are nosy Of course, and he would go he would spend an hour ahead of time and he would drive traffic that way to the open house. And I thought that is so smart. And so simple. It takes a little bit of elbow grease. So I love that that was an he’s now with Keller

Caryn Prall 13:53
it is you know the art of door knocking is not lost. So we have agents that door knock every day. And I mean, Dan fixes was number one REMAX in Naperville. And he came over to Keller Williams about a year and a half ago. And he door knocks 15 doors a day still today. And he didn’t because he got his own way. He just kept hitting the ceiling of 25 million and he wasn’t growing and now he came over and his goal is 57 million and and seeing him getting back because while technology is amazing for the information that it gives us. Nothing replaces availability conversation. It just does it

D.J. Paris 14:30
100% And also, you know, I always say that the two things that are probably never going away, obviously, belly to belly, as you mentioned and also handwritten notes. Nobody does that. And you know, and the handwritten notes are so huge and it’s, it’s it’s another really great way to stay in touch.

Caryn Prall 14:49
He what he did is actually what Nico did was actually what Gary Keller did when he first got into real estate. Yeah, and that’s what he did is he sat open houses every day and lead generated from there And we encourage open houses and we have a unique agreement with Zillow that you can put it out early before it comes on the live the large MLS, you know, the public one. And so you can promote on we’re getting agents who are getting 100 people through their open houses, and selling them on the first day and creating such a stir. So it’s actually in a way, it’s old school and new school hybrid in one, because open houses started. Because we didn’t have the internet, it was the only way for the public to get in a home and see it. There were no pictures online. So that’s that’s where the idea came from. Same with burger tour. But now we have everything available online. But you have to see it, touch it, taste it, feel it, you know, to really know if it’s for you. So,

D.J. Paris 15:45
yeah, yeah. And the other thing Nico mentioned is once he got those people that came through, he said, I would just basically call them until they told me to stop calling. And not in an annoying way, but in a way where he said, I never wanted them to forget that I was a realtor. So exactly. Anything. Yeah. Yeah. Tell us a little bit more about, you know, how you sort of helm the ship and what your, how you educate agents and what you’re, what you’re teaching these days about how to build a successful practice,

Caryn Prall 16:20
really, it’s about agent financials and operating a business. We know there’s a threshold of when you should become a corporation or an LLC financially. So you don’t get killed was self employment tax. So we’re teaching on things like that. I’m not a tax professional. I have a very good CPA. But how I learned to treat it like a business was that was step one, to hiring talent and finding leverage. People feel that teams are negative, or there’s something. There’s this odd undercurrent of non supportive teams and what teams are they’re actually leverage. So it’s teaching like, we have an Agent Alice chin, I’m sure you’ve heard of her. She’s a top Agent in Naperville. She was tired, she was tired. And she joined and last, she has not worked a weekend since last May. So she’s been almost a year since she’s come over because she has the right leverage to do it for her. And we’re teaching agents how to get their time back and find what’s important to them. I met with a woman yesterday about $13 million from another company, great lady. She’s in a time of her life where finances are really important. So my focus with her is how do you net the most amount of money in the shortest amount of time and build a bigger business. She has goals she wants to pay off her mortgage and help her daughter buy a house. And when you get specific on people’s goals, you can impact a lot of change. And so in Naperville alone, where I work primarily out of we have 358 agents in that office. And we do masterminds all the time with our agents. We do training every day. And so that’s really important and our top agents are teaching our agents. So Amy kites coming in to do a listing presentation or Dan first or someone’s coming in to do a buyer presentation, Alice will call fizz bows and expireds in front of the class. Like no fear in that girl. She’s another one of those 30 Something year olds, no fear. And so we have, we have a training opportunity every day, whether it’s in our new office in downtown Geneva, Glen Ellyn or Downers Grove, we have someone teaching somewhere every single day. And that’s, that’s really moving people forward quickly.

D.J. Paris 18:34
Yeah, I know, I love all of that. And I also I do love the person that’s willing to pick up like me willing to pick up the phone and call the Fizbo the for sale by owner at the expired, because those are those can be very difficult. But it’s a great way to cut your teeth and just to, you know, deal with people that may have had poor experiences in the past or

Caryn Prall 18:57
Yeah, the second, the second listing, the second time list is always the best, you always get the price you want. They’re always the most willing to work with you because they don’t want to go through it again. So those are really the best listings to get.

D.J. Paris 19:11
I agree. But you’re right, this idea of treating it like a business you mentioned, you just met with this, this top producer, or rather a $13 million producer. And you know, she’s now in a position where she’s like, I got to start treating this like a business and I got to put together financial statements. I cannot tell you how many brokers even at our own firm, where they should be if they should have incorporated, they should talk to a CPA, they should figure out if it’s an S corp or a C Corp or whatever. And they just have it and it’s it’s there. Not only are they leaving money on the table, but it’s it’s again, it’s running a business. And I think you’re so right about that that all it’s been a common thread among pretty much all the brokers that have been featured on the show that has so graciously given given their time, is they really do too. treat it like a business and because it is. And yeah, I mean it start even starts with running a p&l profit and loss state,

Caryn Prall 20:07
we you know our financials, we’re an open book company, and any associate can see our financials. And so I basically run a really large team, because I run the exact same model in the MRA that we encourage our agents to run to. So when we open up our financials, like Naperville had a finance committee meeting today, they’re going through Keller Williams infinities profit and loss statement, and showing the expenses because we want them to model the behavior. And we also don’t carry any debt. And so that is Keller Williams, Avi, as a company doesn’t carry any debt. So we really want to walk the walk, which does not talk the talk.

D.J. Paris 20:47
Yeah, I mean, we at our firm are the same way. But it is it I’ve always been a huge proponent of Keller Williams, because, you know, for for a lot of reasons, I think you guys, some of the marketing you guys do is incredible. And the fact that, that the brokers can become, you know, part owners of offices is great, and they participate in some of the overflow is awesome. I mean, I just I really, really a big fan. And then of course, you know, having Gary Keller at the helm is, you know, not not a bad thing, either. What advice would you give a new broker or a broker who’s in their first or second year who’s struggling? What would you tell them to really focus on for the next year to help them build their business? Yeah,

Caryn Prall 21:29
that’s such a good question. And you’re probably gonna hate this answer. But it’s lead generation. And it’s the way whatever works for them. So this is how, if you don’t like open houses, don’t go do one, because it’s going to show up all over your face. If you don’t want to door knock, don’t door knock, it’s going to show up all over your body. And so you have to find what works for you and what it is you want. So I moved to Colorado, from Ohio. And because I figured if I was going to sell real estate, I’m doing the most beautiful state in the country. And I was with Coldwell Banker at the time and, and I realized, I love tennis, right? I love tennis. I, it’s a passion to me. And I so I decided I’m moving to Denver, and I’m going to Captain a USDA leak, not an easy to wow, that but that was my way. So that was my insert into my my sphere. And so that’s where I made my own sphere was for tenants. And then I became a USDA lead coordinator for the largest inner Mountain is the largest league in the in the country. And, and so that became my sphere too. And I actually just got a text from someone yesterday from my for my league and said, Hey, so and so needs to sell their house out of here who do you know, and the referral business that you can create is unbelievable. But just whatever it is that you want to do, just go do it and do it well. Because if you focus on what you’re not good at, that is such a waste of your energy. So if you’re great with people in person, go be with the people if you’re good on the phone, go be on the phone, like I had a coach tell me I’m terrible on the phone. So guess what I hate doing now? I do but I do it all the time because I have to. So just like you do and but I love getting in front of people if they like doing a homebuyer seminar, or a first time seller seminar, but whatever their passion is, there’s like 83 sources of lead generation, they just have to find one or

D.J. Paris 23:19
two. Yeah, I couldn’t, I could not agree more with you. I think that trying to be too well rounded is a bit of a misstep. It’s like pick the one or two or three things you really love to do and just hyper focus on that, because you’re right, you were at all. I’m also a tennis player I play to three times a week. And you know, if I was out there producing which, which I’m not, but if I was I would I would be focusing a lot on tennis and making sure everybody knew that that’s that that’s what I did. So that’s such great advice. And you let’s let’s talk also about you know, any potential pitfalls, anything you’ve see mistakes that brokers making their first

Caryn Prall 24:02
they try to have all the answers.

D.J. Paris 24:05
Ah, that’s such a great, you’re right to talk about

Caryn Prall 24:08
today. It’s it doesn’t matter how long you’ve been in the business, I don’t expect you to know the answer. I do expect you to be responsive. So you can be responsive, and not injure yourself legally. And say, you know, it’s like the Disney way. So the Disney way is I’m not sure let me find out we’ll get right back to you. And you still feel scared for but you don’t speak in something you you’re not an expert to speak on. And so that that is probably our biggest lesson is Be responsive but don’t know all the answers because you don’t I mean, I’m sure we still see transactions today that it’s shocking what happens and surprising and not in a bad way. And and I constantly have to ask other people for for answers. So I’m not the managing broker because I’m terrible at details. So I we have people that do that for us as leaders, but I still get asked a lot of questions and I do refer to him probably nine times out of 10. Just to make sure I’m on the right track. So no one no one knows the answers.

D.J. Paris 25:08
Yeah, I think that no, that is so well said, and I’m in similar sort of position. I’m not the managing broker at our firm either. And thank goodness, because I know that I wouldn’t be, I don’t think it’d be a very good one. But also, the reality of it is, is that oftentimes when somebody passes their their exam, and they come in, they sign up? And they’ll, they’ll say, Well, I’m really worried that I won’t know the answers to questions. And I’m, like, that’s normal. So so what you know what I recommend, and I don’t know that this necessarily is the best approach, but I think it’s a pretty good one is to sit down with your client ahead of time before it comes up and say, hey, just see, you know, Mr. or Mrs. Client. I have, I’m newly licensed Don’t worry, I work for, you know, if it was problems, for example, we could talk about how much support and training and you’ve got a team behind you, and you’ve got people to help you. And but, you know, in in our firm, we would say the same thing. But we basically were at the end of it, I would say just in case you ever ask a question, if I’m not 100%? On the answer, I’m going to double check with my team get right back to you within 24 hours or an hour or whatever your policy is. And is that okay? And that person, that client, that client will say yes, 10 times out of 10. And then now you’ve established a customer service policy, which is, hey, if I don’t know something, I will get right back to you. I promise that and and then it lets you off the hook to having

Caryn Prall 26:30
that’s true. And I agree, I’m going to take it old school too, for a second thing that agents their first year, they have to know their market. Previewing homes, yes, it doesn’t happen anymore. And it’s really disappointing that agents don’t go preview. But when I sold real estate, I would preview every home I would show because I had better know that I’m driving up and it’s right here up on the right. And I knew that already. Or wait till you see the kitchen or it’s a wonderful on second floor laundry or whatever it is that has but agents don’t preview anymore. And so getting back to that and knowing I said if your neighbor asks you what the market is doing, you better know your own neighborhood. And so start there, like you don’t have to know all of Naperville. We just closed 5000 homes a year in Naperville. Not we but neighborhood closes you know, over 5000 units happen a year so so it is it’s imperative that at least start with your own neighborhood. And then you you you morph out into bigger areas. Because if you don’t know your market or what’s happening or what’s selling, I relate it to if I go to Starbucks, I go every day against my husband’s greatest well, and I know whichever Starbucks I go to, I’m getting a consistent product, but what I know more is that they know how to make my drink because I can only imagine going to Starbucks and saying I’d like a venti coconut milk latte with an extra shot and what if they stood there and stared at me it silence and they have no idea what I’m talking about. That’s a realtor not knowledgeable about their market area same thing I’d be disappointed

D.J. Paris 28:01
I’d be disappointed too and I think your that it cannot be overstated what you just mentioned and it it for a broker who’s listening who’s like well how do I do that? It as Karen mentioned start in your neighborhood study the MLS 20 to 30 minutes a day know the know every single home that’s for sale at a certain radius or if you’re in the city here you know a certain neighborhood learn every home for sale what the average condo goes for a single family home etc rent prices all of it and just and within six months to a year you will have so much insane knowledge about that particular area you will be incredibly valuable to people for a

Caryn Prall 28:39
city agent know your building and the two on either side of you. And when it crossed the street like just start there.

D.J. Paris 28:46
I love it that so so simple and perfect and it works awesome. Well I think we’ve covered it we’ve covered a lot

Caryn Prall 28:55
probably exhausting in person.

D.J. Paris 28:59
Oh, you and I you and I exhausted yes we don’t we don’t exhaust each other. We you and I exhaust probably everybody around. But we obviously we love Karen and Karen. If anyone’s interested in learning more about Keller Williams, are you what’s the best way

Caryn Prall 29:15
they can call me or text me my cell phone? It’s 630-901-3454 because my name is spelled funny as you know. See?

D.J. Paris 29:25
Yeah, it’s like the it’s it’s like the seventh way you would have guessed. I know. It’s not the first or the second, third fourth. You know why?

Caryn Prall 29:34
My good Catholic parents Carol named my sisters Carol, Kathy, Christine and Cindy. So

D.J. Paris 29:40
it’s Yeah, so Karen is CA R Y and by the way prall And what’s the best?

Caryn Prall 29:46
My name? Var y NPR a lol@kw.com.

D.J. Paris 29:51
Okay, give that phone number one more

Caryn Prall 29:52
09013454

D.J. Paris 29:57
If you’re interested in learning more about what Keller Liam’s offers brokers definitely reach out to Karen. Karen, thank you so much. By the way, I want to reiterate Karen manages 800 brokers under the Keller Williams umbrella that is no small feat. And a lot of them are top top producers. So, you know, we are so grateful that she was on the show today. So thank you so much.

Caryn Prall 30:19
I really appreciate it was really nice talking to you and I know that you will continue to be successful in whatever it is that you do.

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Top 1% producer Greg Cirone completed over 115 sales in the past twelve months. What’s his secret? Aside from becoming extremely knowledgeable about the market, he treats every client as if it was his very first. As this isn’t just a slogan. Greg has 150 5-star reviews from his clients on Zillow! Nearly 100% of Greg’s business comes from referrals, and throughout this interview you’ll learn why!

Greg Cirone can be reached  708.415.6755 and greghomerealtor@yahoo.com.

Transcript

D.J. Paris 0:14
Hello and welcome to another episode of Keeping it real the only podcast made by Chicago real estate agents for Chicago real estate agents. My name is DJ, I am your host through the show. If this is your first time listening to an episode, we thank you for finding the show. And what we do here is interview top producers in the Chicagoland area and ask them how they became successful. And up in just a minute is our interview with Greg Cerrone. And if you are not a first time listener, if you’ve listened to many episodes in the past, we greatly appreciate you continuing to listen. And one way that you can support us is to tell a friend, there are 42,000 realtors in the Chicagoland area. And we’ve got 5000 of them, listen to our show, and we’re grateful for that. But we would love it if all 42,000 got a chance to hear it. So please pass this podcast along to anyone else, if you’re a broker in your office or any other realtors that you know, also, you can send us questions. We do regular features where we ask top producers your questions. So you can send those to via our website contact form, which our website is keeping it real pod.com Also follow us on Facebook. We are at keeping it real pod just search for that. And lastly, if there’s any brokers out there that you feel we should be interviewing for a future episode, let us know. All right, thanks so much and onto our interview with Greg Cerrone.

All right, today on the show we have Greg Cerrone. I have some some notes on Greg. And by the way, he is very impressive too. I’m so glad we have them on the show because Greg got his license and became a realtor at the age of 21. He is now 15 years in the business and specializes really in the Dunning area where he is not just where his office is, but also is the number one agent for that area. And he’s a number he’s a top one percenter court in Chicago Association, realtors for like the last Gosh, five to seven years, maybe longer. He’s also a an award winner. As I mentioned the number one producer in Dunning, and also has been featured in the Chicago’s who’s who. And he is a five star Professional Award winner for the last four years in a row. And he is a really fantastic person. And we’re really excited to have him on the show. So welcome, Greg.

Greg Cirone 2:41
Thank you. Thanks for having me.

D.J. Paris 2:45
Well, thank you, I would love to hear your story about how you got into real estate at the age of 21. So if you don’t mind, yeah, tell us about that.

Greg Cirone 2:53
Absolutely, absolutely. So pretty much I was. I was born, I was born here. I was raised in Italy. And then I came back after I was you know, I did all my studies there, you know, high school, college and then came back to try it out. And I started working in banking. And so in banking, I got it was pretty successful. But I always had this interest about real estate. And My great grandpa actually wasn’t in real estate, but he passed away really young. So maybe maybe I got it from him who knows. But so then I went to get my license just to you know, do it on the side, doing in the side, some extra money. And, and this is how it started. You know, I saw I didn’t I didn’t go in all the way in the in the first I’ve been I’ve been in it 15 years. But the first four or five years I was I did a part time I did on the side, you know weekends after work. Just you know just working hard network and building that pipeline because for me it’s key it’s key having a good pipeline good relationships and just building up. I then eventually when you know when my part time job made more money than my full time job then that’s when i i went all in.

D.J. Paris 4:04
Yeah, I want to just back up. And that’s yeah, I definitely want to continue from there. But I want to back up for a moment. And so you were born in Chicago, and then you move to Italy and that’s where you were raised essentially. Yes.

Greg Cirone 4:14
All right. Yes. Yes. Correct. My were first generation and my my mom never liked to hear that much. And she convinced my dad to go back. And I was

D.J. Paris 4:22
Where are you guys from in Italy?

Greg Cirone 4:24
We’re from Sicily.

D.J. Paris 4:27
I have I’ve yet I’ve only been to Rome, Florence and Venice. So unfortunately not yet Sicily.

Greg Cirone 4:35
You should go they don’t sell Sicily that much when you go book, a travel ticket but it’s pretty it’s pretty nice. It’s relaxed good food. So can’t beat it.

D.J. Paris 4:45
Well, yeah, I mean, no, I know lots of people that have been and they and they say that that’s when I go back next time do like Amalfi Coast and then also do Sicily and yeah. Awesome. Well, so. So tell us so when you started you were doing it part time. I’m at 21. And that point that that seems like a tough thing to do. How did you even part time? How did you find clients back when you were that young?

Greg Cirone 5:09
You know, it was tough. You know, the first thing when I did I just hit it off, like, you know, people that I knew, you know? So I’m like, what, who do I know? Like, you know, friends and family, and, you know, people in the community, so I do any talent show, I’m like, you know, let me take advantage of, of the talent thing. So I just show up to go like to like these, you know, you know, kind of like cafe’s, they call them, you know, we’re Italian guys are just hanging out. And, you know, I just told them that I was a realtor, and just what I did, you know, this past, kind of like, back then it was cards, you know, now you just give shorts and Weibo and give you an E signature. But so this really hard work, you know, it’s just step by step and doing the right thing and, and just building up, you know, but it was, it was a little tough, but, but also, it’s just keeping people lucky no, then keeping people in your pipeline, you know, never forget her about them. So, eventually, when, when he got your first client, then you just do you just, you know, then you took it off for you know, from there, then, you know, created like, you know, a mailer list or, or you, you know, you you sold your first house on you, I hosted open houses, so I kind of started from scratch, it was a lot a lot self learning. And also to manage a lot to, I’ll tell you the truth, because in banking, they they spend millions of dollars on marketing and how to do customer retention and relationships. And I just, like kind of like, I knew that it was work, you know, and bank and then or apply it a lot, but I knew those things could work. And so I played a lot that a lot of that in my business. And and believe it or not, that works. And until today, I still do.

D.J. Paris 6:44
Yeah, that’s, that’s really interesting. And because I know a lot of times with newer brokers in particular, and we have a lot of new brokers that listen to our show, and I know that oftentimes they say, Okay, well, I, you know, in your case, you went to some of these cafes, you know, chatted up a bunch of the patrons, and then got, you know, gave them your cards, maybe got some of their information, and then how did you actually stay in touch? Because obviously, you know, maybe not right away, they’re having you by help them buy or sell homes? And so, like, what would you actually do to stay in touch,

Greg Cirone 7:15
you know, stay in touch different ways, like so I’m a big, I’m a big fan of doing like mailers, so I still do traditional mailers or people that you know, people that I knew or they knew me back then you know, now I have like a you know, a whole CRM, CRM, you know, a whole list that I send mailers, but back then, so people that I knew I put them in my, you know, my Excel form, and I start sending them a piece of mail or you know, just to remind them I was in real estate, it could have been my face and a baseball schedule, my face and hockey schedule, the yearly calendar that I did, like, if I know that person, like let’s say soccer, then I did like a soccer schedule that you can find here. You know, if I knew that person liked I don’t know you know, any other sports that’s not in United States, I did something particular for them and I sent it to them at their house so just it was constantly just being under reminding you know, it more a lot of like, you know, back then now is the last social media you could touch people with social media is a little easier with like a message or email. Back then it was more like on you know, I say like, you know, in the field, you literally was in the field, you’re sending mailers, you’re shaking hands, you’re showing up at people business just to chat, you know, just those kinds of stuff. Yeah,

D.J. Paris 8:30
and I’m a big fan of doing that stuff. Even now. I think that it’s been Yeah, because most Realtors don’t do it. I think it really gives an edge to the people that do.

Greg Cirone 8:41
i It’s funny you said so because I’m a big believer that I think I think pretty much what it comes down to, I mean could invent the tools no, we could have new tools. But at the end of the day, it’s really the basic principles. You know, just common courtesy, being polite, caring about people doing what’s right. It’s things that we’ve been doing probably the past 2000 years, you know. So it just kind of the basic principles and and like you said like you know, now you go you know you do those things and it goes a long way and people people like even like I see a lot of modern, like you know, millennial, I guess they call them but but they like the internet and like to chat and like the emails and like you know Facebook but when it comes to serious things they do like the face to face they like to see you in the eye they like to make sure that they could trust you in order to put on a face to name on the face to that to that message you know and know someone is there to to help them out and get you know, at the end of the day Buying a house is one of the most important things in life and might be don’t want to you know, one of the biggest purchase in their life. So there’s a lot of motions and it’s a big is big.

D.J. Paris 9:49
It is and I think you’re so right that this face to face. Idea does not go it has not gone away yet and it probably isn’t going away. And I’ll tell you a story it Even at our own firm, this is about five or six years ago, the we had, we were just I was working and an attorney walks in, and we maybe had 10 brokers at the time, it was very small office, not much going on. And an attorney just cold walked in, you know, a real estate attorney cold walked into our office, we didn’t know who she was, and just introduced herself and said, Hey, I’m so and so. And, you know, I just thought I’d come in and say, Hello, I’ve heard good things. And if you ever, you know, want to do an event, you know, I’d be happy to put on an event for your for your brokers. And I had gotten a lot of cold calls from attorneys and lenders, but not nobody had ever just walked in before. And, you know, now we have it. And so we started a relationship. And she’s been doing events with us ever since. And I still get a lot of mail, not that many, but I still get some phone calls from attorneys going, Hey, I’d love to get in front of your brokers. And now we have 600 brokers. And I’m telling you still nobody has ever just walked in like that. And that takes an attorney. And I know, there’s a lot of real estate attorneys. And you know, you talked about walking in to businesses and just saying hello and talking to you know, chatting up people who are hanging out at those places. It is it is you it is not a crowded place, there aren’t a lot of you won’t have a lot of competition in there. Right. Right. So I think that I think that’s very, I think that’s very helpful and very important.

Greg Cirone 11:28
Absolutely, absolutely are, you know, oh, even doing something like you know, is not you know, I did so many like I call them like favorites, you know, a client need a notary stamp client needed some information or taxes. Sure. It just stuffed it was nothing to do, I was not going to make a mission was not going to sell them my house. But I kept in front of them. I was helping them out. And then eventually I have many stories I could share people that I met 10 years ago. And then after 10 years, they gave me a million dollar deal. or refer me to somebody that you know, was doing a big 1031 Exchange, or, you know, so many scenarios where 10 years ago with somebody would have told me my buddy will say, Well, you wasted all your time. It’s your weekend, Sunday, what are you doing? And I’m like, no, no, I gotta help them out. Like for free? And like, yeah, absolutely. You know, so that that’s my philosophy.

D.J. Paris 12:14
It’s a good philosophy. It’s obviously served served you well. And, you know, let I want to also talk about, you know, your offices in the Dunning neighborhood, you specialize in the dining neighborhood. Obviously, you not all of your deals go to that particular neighborhood, but a lot of them do. How important has it been for your business? To have a specialty geographic specialty has that has that made a huge difference for you?

Greg Cirone 12:37
It does, it does. So absolutely. So especially on listings, I’ll tell you truth, it may have been true at all, you know, kind of like I met a lot, you know, back in the day when I started, you know, I had buyers all over the place. So I sure I was gone Quinn to Tinley Park all the way to Chicago a little bit everywhere. And I still do by referral, I still go take care of the buyers. But I figured out eventually on the seller side, they want people that know the community that they could trust that they see really often. So so that’s when I started like, you know, kind of a natural grind, I want to say geographic farming, but it kind of happened naturally because I was doing a lot of deals around the area. And and people just seen my site like, you know, a new me. They just knew me from the past. And they’re like, Hey, Greg, I see you everywhere. Like, oh, wow, that’s interesting, because they saw my site, it’s all my just sold posts, you know, postcards, I said, they saw my, my flyer, they saw my office, they passed by in Harlem, or they just saw me driving around, you know, because they know my car, and they have like, you know, personalized plates on purpose. So they knew exactly who I was. So that kind of that kind of helped a lot. And and especially and after you prove yourself, you know, I mean, then people tend to give you more business, especially starting on the seller side on certain areas, like dining.

D.J. Paris 13:56
Well, yeah, I mean, I think I think that’s so true. And what’s what’s great about it, too, is if you think like so let’s say someone moves to dining who’s who’s not from the area, they moved to this neighborhood, and they maybe they don’t know, any realtors, they’re new to Chicago. They’re just, you know, they don’t have a referral. And they and, you know, if I if it was me, I think well, maybe I should just see who sells the most stuff here. Right. And that would be that would be a very logical thing to do. And I think, you know, that’s probably gets you a lot of business in and of itself to

Greg Cirone 14:30
absolutely, absolutely Actually you’re right I do get calls where they’ll just call me because they they they did research you know, because a lot of people do research now and and they just found me and they’re like, Oh, you sold the most and, and my thing what I do, I really stopped I don’t try to sell myself over the phone. I’m like let’s shirt. Again. I go back to the basics. Let’s meet let’s meet for coffee and I told him I like to prove myself like you’re my first deal ever forget about what you read. Forget about my 100 Whatever deals I close. I’m like just like my first deal ever and we meet and we meet for coffee. I don’t like my wife, I’m a big person, big person. I’m a people person, my wife, maybe a little less. She’s like, why you spent so much time on like, you could do, you could have, you know, eight hour days instead of 13 hours a day. But I like to spend that time with people and get a coffee and talk about their family and know about their kids. And it just, it goes, it goes far, it goes far and really produce a lot of business in the long run.

D.J. Paris 15:24
Well, and it’s not just a lot of business. I mean, we should say this, because Greg is very humble. But he first of all, Zillow, Greg has 146, five star reviews, which is, which may be not a small, it’s very so so that’s not Greg telling you. He’s great. That’s all of his clients. And in the last, and I’m only looking on Zillow, which may not be totally accurate with this number, but it’s probably higher. But Greg has done over 100 sales in the last 12 months. So this this is a very active person. Yeah, right. Right. A little higher. So congratulations. And what percentage of your clients are referrals?

Greg Cirone 16:02
You know, I want to say a least 75% 70.

D.J. Paris 16:06
Isn’t that amazing?

Greg Cirone 16:08
Thank you. Thank you. 75%. The least? Yeah, just by doing the right thing. Go ahead.

D.J. Paris 16:14
Yeah, no, that’s doing the right thing is pretty much is pretty much it. Right. I mean, and I think I, you know, you had mentioned also, when we were talking to you before, before the podcast about outworking your competitors. I mean, first of all, 13 hour day is definitely out of your competitors, or at least a lot of them, but talk a little bit about, you know, what you think you do differently? Or maybe, you know, that gives you an edge, you know, that enables you to be the top the top broker, and,

Greg Cirone 16:44
you know, I don’t want to, you know, like, I tried to keep home, I’m humbled and I do keep Yes, you and, and like that, that’s one of my main skills. But if I never, you know, even if I close a lot, I never tried to get that to my head, you know, so I every every, but the main thing you really got, you know, besides all work in your competitor, especially if you’re young, and you’re just starting Absolutely you, you got to put in hours, you got to put in hours because you’re if you want to get more business, that’s, that’s what you got to do. You got to work smart, but work hard to. But the main thing is, I think, I think is that relationship skills, you know, having a good relationship key in creating relationship versus being like, you know, I always tell people, like, I’m like, This is not like buying a car, like a car, you’ll see the person one time I’m like, if you buy today, or you sell today is fine, but I really I’m not, that’s not my goal, my goal is here to meet you. And, and, and Heaven, and you know, me and her and I hope I’ll stay in your phone and be your guy to go there to go guy for next, you know, 10 years, 20 years, or maybe 30 Until I’m, you know, I’m in the business. And go ahead. I’m sorry.

D.J. Paris 17:54
No, no, you’re that’s so right. What if you don’t mind telling us? So what somebody does complete a transaction with you. So they move into their new home, you know, or that you help them sell a home? And, you know, how do you how do you stay in touch with that client over time?

Greg Cirone 18:11
Yeah, no, absolutely. So I definitely, again, that’s one of my relationship things that I care a lot and you got to stay in touch, where were you sending them the right when they move in? Actually, I’ll try like, you know, go go see them, I’ll make a surprise, sees how they’re doing, I’ll bring a little gift, or at least Oh, get a gift from me, you know, by the mail. I think that’s really important to say thank you, you know, I don’t really know sometimes they don’t even expected but it’s really nice. It’s on your way. And then also keep in touch with them sending them an email here and there for holidays. And they definitely everybody receives at least five to six pieces of mail from me per year, at least minimum, for sure. So or even on Facebook, a lot of them are my you know, Facebook friends. So it’s kind of easier now. So what I’ll do, let’s say somebody had a baby and I let’s say I didn’t meet them. Like I’m, you know, last time I saw them was seven years ago, we kept in touch, but I didn’t see them for seven years. I’ll still like, you know, I’m like, Okay, let’s let’s, you know, talk to my staff. I’m like, Hey, we got to send a gift to this person. You know, they just had a baby, send No, send them Santa baby gifts, a new baby newborn, and they’ll send it and, and it goes all it’s incredible. They’ll call me. They’re so thankful. Like, they’re like, oh, Greg, I can’t believe you even thought about this. And yeah, little things, you know, even like a little note, you know, sometimes I’ll send like, you know, like, just randomly, you know, I’ll send like, Yo, the past two year clients. I’m like, let me just send him a $5 Starbucks card. You know, just to just to say thank you for all, you know, thank you for being there supporting me and enjoy coffee, you know, little things. And it goes a long way.

D.J. Paris 19:50
100% I mean, you’re you’re absolutely so right. It’s It’s funny, I you know, I talked about writing a note I was thinking about this the other day I Probably get three or four, maybe that’s even high, maybe it’s more like two or three, aside from my family who sent me a handwritten note, once in a while, I get maybe two to four handwritten notes a year from you know, it’s almost never Yeah. And I always think, you know, it’s a little bit of a pain to write them out. I get it, it’s a little bit of work, but oh my gosh, you know, if, if it’s such a lost art, and people who still do it, reap a lot of benefits from it, but I think you’re so right, like, Hey, I saw this person had a baby on Facebook, probably be a good idea to, to well, because you also you want to do that. But it’s also something that is incredibly thoughtful and does not go unnoticed by, you know, those those clients, it’s not like, they sent you a message saying, Hey, I just had a baby, you know, these, just figure it out on your own and, and set. It’s incredibly, you know, generous. And, again, most other brokers, I’m not sure they even think to pay attention to see if their clients were going through life transitions. So I think that’s really smart.

Greg Cirone 21:04
Yeah, no, it’s just becoming the really, most of my clients, a lot of them become my friends. So sometimes I get in trouble. And there are days parties. You know, I don’t know, if my wife likes all the, you know, these new invitation shows that we have, she’s like, ah, you know, we’re too busy. But, but no, I enjoy it. I really, I really enjoyed this, I guess that’s, you know, that’s my personality, I really like to just, you know, talk with me, I’m not a I’m not a desk guy. And that was a problem with banking. Like, it was nice, but I felt like I was in a cage. You know, I never, you know, I was too much in an office, I like to be out and about and meet people and just, you know, interact. So

D.J. Paris 21:41
well. Yeah. And, you know, that’s, that’s obviously very obvious, just chatting with you. And I just, I’m stuck on something you had said earlier. And I think it’s, it may encapsulate why you’re so successful. If we had to break it down to one sentence, I just realized, when you said this, it was so simple. It’s very profound, though. And he said, I treat every deal as if it’s my first. And, and I know that was kind of a throwaway line for you. Because it because that’s not like a slogan of yours. Like, that’s how you actually believe and think it’s not this tagline that you throw on, you actually act that way. And as a result of that, I mean, that’s what every consumer wants, they want their broker to, like, treat it as if you’re their only client, and you’re the most important thing in their life. And so I just wanted to go back to that for a second. Because I thought that was really a very profound thing you said in a very simple way. So you know, that’s, I always tell it because we have so many brokers in our office, I always say, if you can have your clients feel that you’re that you’re their only client in a positive way, like you are just giving them all of everything. Boy, they will tell everyone they know about you.

Greg Cirone 22:46
It’s true. It’s true. It’s so true.

D.J. Paris 22:49
Yeah, are the managing broker or the sorry, the owner of our company, I used to have a philosophy back when he was producing, he was a top top producer as well. And his philosophy was, because I never wanted a client to have to call me first like with a question. So and I thought, What a great philosophy.

Greg Cirone 23:09
It’s so true. You know, one thing I do too Anatol, any, like you know, new guys starting and they want advice. If you have somebody comes up to your mind, and you know that fight, you’re dealing with a file, and he’s in your mind, call him right away. Because he means that guy’s thinking about you. There’s a special energy out there. Yes, we’re, it’s some that something’s telling you. That guy’s thinking about you. You got to call him contact him. And I’m positive. He’s gonna tell you Oh, my God, I wasn’t about to call you. I was about to tell you. So like your, like your manager, your or your, you know, your manager used to tell you, it really it felt true. I really am a true believer that well, yeah.

D.J. Paris 23:42
And and you know, buying, buying and selling homes can be very confusing to the average person too. And there’s just so many steps and so many unknowns. And I think oftentimes realtors, sort of because they’re so close to it. They forget that not everyone gets every understands every Yeah, so we say like in the terminology. Absolutely. So well, gosh. Oh, tell us about. So I wanted to go to a couple of the stories that you had. You had mentioned before we started what tell me about the big dog incident. We were locked in the bathroom?

Greg Cirone 24:12
I don’t know. It’s still a scary story a little bit. I tell us no, no, I was pretty good. So I had a showing I was a client of mine. We’re showing a couple of three properties. So we get to this property. I knew there was a dog that the agent told me Be aware of a dog. But it’s it’s going to be it’s not going to be be aware of the dog is going to be in the cage. Do not worry. It’s a big dog. Don’t be scared is going to be in the cage. I’m like, Okay, no problem. Like okay, cool. You know, I’ve done this before. So we opened the door we get in. We’re about to walk in the kitchen. And this dog I hear the dog I told my client, don’t you she’s like, it’s they’re proud. It’s their dogs here. I’m like, Don’t worry, no big deal. It’s in the cage. Don’t worry about it. All Associates is huge. I didn’t know what the kind of dog it was. It was huge. It was literally it was bigger than me. And it’s calm. It’s like barking Start running. Luckily, we just got so lucky. On the right side, there was a bathroom. So I turned my client like I literally throw like line in there, I go in there, I locked myself inside, and the dog is going crazy, like barking and try and knock the door down. And not that I’m afraid of dogs. But I think that that wasn’t that friendly. And long story short, we were we were in the bathroom for an hour because I had to, you know, call the agent the owner wasn’t around and went to work. And pretty much we were for an hour we were in the bathroom chit chatting. And you know, I guess we went over comps and properties.

D.J. Paris 25:36
Well, it’s good bonding time, I guess. Boy, that’s funny. What a funny story. Tell, tell me also about you. I know you had a story. And I’m sure this has happened because it happens to all brokers. But we had to get a deal fall apart, but you kept the relationship going. And you found another another home. I know you had mentioned there was a story there.

Greg Cirone 25:56
Yeah, there was a it was a really nice house was hard for my client to find it was one of those, you know, one of those clients wanted either two blocks that he wanted. And that’s it. And we finally found that everything was going good. The kids used to own the house. And, and they were going to sell it but I guess they had they got cold feet it the seller, I rose representing the buyer and they literally canceled the day of closing, they did not show up at the closing Oh, ethical schedule ready moving trucks. Everything was it was a nightmare. It was for him, he was so straight. He was so like, he didn’t want to look for houses anymore. He was upset. It was like the worst thing ever, you know, and it was a first time homebuyer and it, it was tough. So it was really tough. But again, you know, I was able to, you know, just keep them calm, and, you know, just, you know, just go to, you know, meet up with him. And if you don’t give him some time and, and we went out there, I told him sometimes I’m a big believer if it’s not meant to be it’s not meant to be and like maybe, you know, it was a sash or who knows. And, and believe it or not, then after, you know, took a little bit after a few months, we found something else and he’s happy now. And you can even you know, he’s happier than the other house that he last saw. So it worked out really well. So sometimes you just gotta have like, you know, there’s a lot of challenges, a lot of challenges, you know, and you got to have a strong mindset and it just never, you know, you gotta be stronger than your client, you know, you just got to be, you know, even if it beats you up, you gotta be like, okay, it’s okay. Let me you know, get upset for two minutes, I get up so two minutes in my car, then it’s like, okay, you know what, I gotta, you know, I gotta be there stronger for my client and, and help them out and, and don’t panic. And, and, you know, it just got to be strong mindset.

D.J. Paris 27:41
Well, it’s clearly worked out very, very well for you. Greg has had an incredible amount of success in his 15 years and has seen I see no sign of it slowing so we, you know, by the way, if there are any buyers, sellers, renters, investors, anyone out there who’s interested in working with Greg, I want to make sure we give Greg’s website, which is by the way, it’s Greg the realtor.com. And Greg, by the way, Greg is also the managing broker of his office which is called interdomain Realty, it’s in the dunny neighborhood. Greg works all over though he’s not just limited to the Dunning area. So it’s important to to mention but Greg, what’s the best way if anyone’s out there wants to work with you that they can reach out,

Greg Cirone 28:20
you know, just give me a call or text me. I’ll give you my cell phone is 708-415-6755.

D.J. Paris 28:29
Awesome. So shoot him a text or a call. Do you want to give your email as well?

Greg Cirone 28:33
Yeah. It’s Greg home realtor. One word Greg home realtor@yahoo.com.

D.J. Paris 28:41
Awesome. Well, Greg, we are so glad to have you on the show. I think you said a lot of really wise things. So hopefully our listeners will appreciate it as much as I did. So thank you so much, and we appreciate appreciate you being on Thank you.

Greg Cirone 28:55
Thank you. Thanks for having me, DJ

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Michael Mandile closed 73 transactions in his first year. I’d like to repeat that for everyone. 73 TRANSACTIONS IN HIS FIRST YEAR. In our conversation Michael talks about the philosophy he developed called C.L.I.E.N.T., and how he uses it with every customer and how it generates referral after referral for his business. And, oh yeah, Michael sources every single one of his clients on his own. Already a top 1% in his first year, this is an interview not to miss!

Michale Mandile can be reached at 847.322.8827 and michael@chicagoluxhomes.com.

Transcript

D.J. Paris 0:16
Hello, and welcome to another episode of Keeping it real. The only podcast made by Chicago real estate brokers for Chicago real estate brokers. My name is DJ Parris, I am your host, and welcome to the show. If this is your first time listening, we appreciate it. Or if you’re a regular listener, we also appreciate that too. Please tell a friend if you have other brokers in your office that could benefit from hearing from top producers like Michael Mann de les, who we are about to interview in just a moment, please let them know about it. And so pal, a friend passed this podcast on we have 1000s of listeners and can always use more. Speaking of if you have any brokers that you admire that are really out there doing interesting things that we need to interview for future episodes, let us know. So you can visit our website, which by the way, not only can you let us know about people we should be interviewing, but you can listen to every episode we’ve ever done. Our website is keeping it real pod.com also find us on Facebook, we publish all of our podcasts there too, which is just search for keeping it real pod. And also a couple of regular features that we have on the show. In addition to interviewing top producers, we have a few top producers that do regular segments. Once a month, we have Eric workman who talks about investments. Eric is an investment specialist. And so be on lookout for those episodes. And we also have the wonderful Carrie McCormack who talks about what’s going on in the market that brokers need to know she looks. We look back the previous month and forward the future the next month. Now the great thing about Eric and Carrie is they are here to answer your questions. So if you have any questions about investments, let us know you can send those through our website or through Facebook or email. We’re really easy to find and Eric and and also Carrie are here to answer those questions. Kerry’s great for if you have questions about how to be successful as a as a realtor. But please send us those questions. We greatly appreciate it. But now let’s get on to our interview with first year superstar Michael Mann de la.

Today on the show we have Michael P. Mandalay who is a graduate of DePaul and double majored in business and poli sci has an extensive background in real estate sales, property investments and property management. He’s been he was raised in a family of real estate investors, Michael has gone from observing family business to working his way into the world of real estate. He’s joined at properties as a driven real estate broker in downtown Chicago. Michael is best known for his incomparable customer service and takes pride in his client philosophy. That’s an acronym that he developed, which stands for customer service loyalty, integrity, energy negotiations, and triumph, which are six actions he guarantees his clients will receive from him and he’s downtown residents since 2007. He’s also an enthusiastic member of the community enjoys traveling, while going to Black Hawk games dining out excetera when the you know, when the real estate comes to mind, Michael is your guy. So thank you for being on our show. We appreciate it.

Michael Mandile 3:26
Awesome. Thank you for having me. Glad to be here.

D.J. Paris 3:28
So we always like to start our shows by asking how people people’s about people’s journey and brokers journey into the business, you obviously have a family history of it. Can you talk a little bit about that history? And then sort of what propelled you to continue on?

Michael Mandile 3:43
Absolutely. So you know, growing up my parents, my parents dabbled in real estate, nothing crazy, but investment in property here investment in property there, you know, more so on the rental side, just as my childhood, you know, rather than sometimes playing outside or being with friends, I was being dragged around to, you know, rundown properties that were looking to be fixed or collected or and stuff like that. So, you know, I saw the ethic of hard work a but real estate be and it always stuck with me. I always enjoyed it and, you know, started to appreciate it later on in life.

D.J. Paris 4:17
And is your family originally from Chicago?

Michael Mandile 4:20
Yes, both my parents are from Italy. But, you know, prior to moving here, they came when they were younger. They both are from the Chicago suburb area.

D.J. Paris 4:30
Gotcha. So, so at what age did you get in get your broker license?

Michael Mandile 4:36
I just received my broker’s license about a year ago.

D.J. Paris 4:41
That’s, that’s amazing. And you’ve you’ve had a pretty impressive start. And you know, I’m sure you’ve seen a lot of people even within a year, who fizzle out or who don’t continue on. I know you know, the dropout rate in this industry is obviously shockingly high. But can you talk a little bit about You know, what you feel you’ve done. That’s helped keep your business going and growing.

Michael Mandile 5:05
Absolutely. So yeah, I started a year ago, I’m 73 transactions in 2017. This year is rockin.

D.J. Paris 5:12
That is, by the way, let’s I want to pause, and I’m going to repeat that it’s 73 transactions in a year is in incredible, incredible incredible. And I say that as the the firm I’m at we have 600 brokers at properties has about 3000. So I can tell you that even with our 600 brokers that would that would be an incredible for a veteran agent, that would be an incredible year. So congrats to you, that’s so much

Michael Mandile 5:39
appreciate that. So to answer your question, it’s, it’s a lot of everything. You know, it’s it’s persistence, it’s hard work, it’s just seeing what you want. And really focusing on that goal and putting in the drive and the effort until you you’ve accomplished what you need to accomplish. And you know, always looking to improve always looking to be better always looking to grow your network, your sphere of people, it’s it’s real estate on the mind, from the moment you wake up the moment you go to bed, it’s it’s what I’ve programmed into my head, and it’s worked, you know, just networking connections, shaking hands, and always having your radar up to see what’s available and who needs. Who needs a real estate broker.

D.J. Paris 6:21
Yeah, and, you know, it’s, it’s so funny. So we interview a lot of, you know, basically everyone we interview as a top broker for this show. And oftentimes, they there isn’t a secret of Magic Bullet sort of strategy that they’ve employed that no one else knows about. And they’re like, oh, you know, I have this sort of special way of getting business that, you know, nobody else is privy to, it tends to be, well, I tell everyone what I do. And I stay in touch. And I wake up thinking about real estate. And, you know, so what you’re what you’re how you answered that was was really very, very in line with with all the other top producers, but I want to drill down just a little bit because oftentimes with with the brokers we have, who do listen, who aren’t yet top producers, they’re constantly going well, but what does he actually do? And I know that sometimes that’s hard to verbalize, because you’re like, I just, you know, tell everybody, but, you know, when you first started, how did you make sure that everybody you knew in your sphere of influence knew you were a broker? Was there? Did you communicate that anyway, to make sure everybody knew that you had now gotten your license and could help them? Sure, well,

Michael Mandile 7:27
first, first off, I had properties training was amazing. I mean, he really instilled some, some great techniques and great ideas as to what to do. But I mean, I literally, I went through my cell phone, you know, and what literally reached out to everyone I had, you know, whether I talk to them every day, or haven’t talked to them in years, went through my email database, who have I communicated in some way shape or form with emails, neighbors, you know, door guys, I’ve at the store, you’re in line, you start talking with the person behind you, whatever it may be, but I really just digging into whoever I’ve crossed paths with in my life, and really just wanted to let them know that, hey, I’m in real estate, whatever you need, I’m here to help you. And, you know, a lot of people responded to that, to really get me off my feet, they put trust in me to, to get get going. And, and I was grateful for that. So that really helped to give me confidence. And it gave me some momentum to roll with.

D.J. Paris 8:30
Yeah, and I’ve always thought too, sometimes a newer broker may the one of the objections they’ll have to doing that is to like, but I don’t know enough, what if I screw up, you know, and these are my closest friends and family these and I always say, well, these are the people most likely to forgive you number one, if you make a mistake. But also, you know, and hopefully you work for a firm that helps you along the way and of course, at properties has that reputation. And you know, they’re going to assist you through every step of it. But also I find that, you know, it’s such a simple thing to do is to go through your, you know, your address book, essentially, you know, digital address book and go, I’m going to make sure everybody knows what I do. And, you know, of course, we tell our brokers to do that new brokers do the same thing. And I suspect most of them still don’t do it. And it’s a real shame, because I don’t know how else you would expect to grow your business. And, you know, it’s just, you know, even if you just wrote everyone a little personal note and said, Oh, by the way, I’m now a broker. Here’s my card if you need anything, you know, buy, sell rent, etc. I’m your I’m your guy. It’s pretty simple. And it’s essentially what you’ve what you did. And obviously it worked out really well. So what what percentage would you would you estimate of the 70 Plus transactions were from your existing sphere?

Michael Mandile 9:50
I would say maybe seven or eight. I don’t know. off the bat.

D.J. Paris 10:01
Sure, yeah, and for most brokers even getting seven to eight transactions in a first year is not a bad first year. So it’s I we didn’t I don’t know if you know, Nico apostle Amis over at Keller Williams, he, he was talking about his first year and what he used to do, I don’t know if you did this, but he would host open, he had no no listings, he had no clients. He was from the Linkin Park area, I was born and raised. But he’s like, I, we, he was like, 22, he’s like, nobody’s gonna give me a million dollar home to sell for them. This, he’s been in the business forever now. But at the time, he went and went to every top producer in his office and said, I will do open houses for you in Lincoln Park and Lakeview, because that’s where I want to specialize. And it makes me seem like I’ve got stuff going on. And, and he did that. And then he would go knock on everyone’s door, who was adjacent to the homes, that he was doing the open houses and meet the neighbors. And he would say, hey, just so you know, I’m doing this open house. And that was one of the ways in which he, he built his business, which I thought was very interesting. But he ultimately ended up would call all his friends and say, Please come to this open house, I need I need bodies to show up. So how did you where did the other deals come from? How were you able to get out there? You talked about networking? You know, is there any particular secret sauce to networking that you’d recommend? Or that’s worked for you?

Michael Mandile 11:21
Yeah, I mean, it’s, it’s always having your radar up. So I mean, I, it wasn’t typical networking, to generate the other leads, or whatever it was more, you know, like you said, having an open house and see who comes following up with them referrals, you know, from a deal, you receive another deal, people are impressed with how you work, or they give you a referral. You know, in the doorman where I lived, you know, making a connection with him, you know, the lobby, just just really putting your face out there and really just reminding people that you indirectly cross paths with after you reach into your original database that you’re in real estate. And, you know, like you said, like showing people you’re busy, I think helped, you know, hey, I’m sending out a mailer or posting something on your Facebook and people share it, whatever it may be. And there’s a lot of uncomfortable situations where you know, you’re cold calling, or, you know, you’re sending emails to people you don’t know or you’re like you said, knocking on doors. I mean, it’s it’s doing a lot of things that I didn’t want to do out of my comfort. Sure. But I realized I had to do to generate some success, generate some business. So

D.J. Paris 12:35
yeah, I was I interviewed and these are at properties, a grace Goro and Julia Brenner, who are partners. And they’re also grace is the she’s in the why I’m on the YPN. Board. i She’s not the president. I think she’s the vice president. But anyway, I interviewed them as a team. And they’re young and and they’re killing it. They’re top one percenters. And I asked them how they grew their business. And they said, they did it with rentals. And they said, you know, we didn’t have any sales right away. And they’re from they’re both from Park Park Ridge, but they said, No, we just didn’t have any. So we did rentals, and then we turned all of those, not all of them, but we turned a lot of those renters into buyers, you know, within within a year or two, and we stayed on top of it. And one of the thoughts I had for you know, you talked about, you know, making friends with your doorman. If you if you, if you’re a broker out there, you’re listening, and you want an idea of of how to potentially work with more renters, which a lot of brokers, you know, don’t necessarily want to do because they’d rather do sales. And obviously, that’s a great thing too. But if you did want to do rentals, one idea that that I would always recommend is, you know, if you go to some of these buildings, or if you live in a building with a doorman, and it’s an apartment building, and it’s in particular, the high rises, you could go in and say hey, what do you guys do? Or even just the the management company if they if they’re there on site? So what do you guys do when somebody decides not to and to rent an apartment here? They come in, they see it? Maybe they even run a credit check and then they just decide elsewhere? What do you do and, and I think what you’d probably find is those doorman or even the management people, they’re on site, just go ahead, I don’t know, we just let them go. And if you can build a relationship with those people and say, Well, geez, I have access to 1000s of other apartments. I’d love to talk to that person. You know, you probably get a few leads that way. Sure. Absolutely.

Michael Mandile 14:23
Absolutely. I rentals were huge for me my first first year I mean, that was a big part of my business a huge part. And you know it’s it’s it’s only been a year since I’ve started with this business and I’m starting now to receive Hey, I’m looking to buy Can we go out and take a look so I definitely look forward to that but I anticipate that happening that’s huge. Yeah, it’s

D.J. Paris 14:46
it’s such a great thing. I think rentals are so awesome for brokers in their first year if they’re not slammed with sales and Most brokers are not slammed with sales in their first year. It’s just a great way to stay busy to earn earn some some faster Income and sales will bring, and also set yourself up, you know, for future sales. I know for me personally, I was 30, before I bought my place. And I probably could have bought a year or two before I did, but I just didn’t know that I could I really didn’t, I was a smart enough person who knew nothing about real estate. And I, the only reason I ever ended up buying a place as my friend who, oddly enough was my boss. But at the time, I was in technology, and he said, you know, you buy a place, you should buy a place. And I said, Oh, really, I just didn’t know. So I think this education piece of it is so huge. And, you know, if you’re working with renters, you have this amazing opportunity to stay in touch. And they’re going to use a realtor when they buy a place. And it might as well be you. Right? Absolutely.

Michael Mandile 15:44
Yeah, I mean, stay in touch with them. And, you know, how is everything and you know, kind of reach out and build a relationship with them. And it’s also good practice for brokers just getting started you get experience with the MLS, you know, your back end with the company, you work for contracts, you know, being on your feet scheduling, stuff like that. So it’s a great experience. And like you said, it’s it’s easier money, you know, there’s more people in the renter pool, especially here in Chicago. I mean, the markets insane with that right now. So, so, great opportunity.

D.J. Paris 16:17
Agreed. And, and again, these are, many of them are future buyers, and you might have to wait a year or two, but it’s certainly, you know, they’re going to use someone and it’s going to almost certainly be someone they know. So it might as well be the person that’s helped them find the apartment, right. So that’s, that’s a so well said, tell us a little bit about your client philosophy. Can we break that down a little bit? Absolutely. So

Michael Mandile 16:41
I it’s something I kind of stick to in my head, and I just want to let my clients know that I will do that. For them. It’s a protocol I follow. So I mean, you have to offer customer service to your clients. I mean, no matter what the customer’s always right, the customer’s always first. You have to be there for them, you know, people are counting on you. Your responsiveness, your promptness, you’re giving them what they want, you know, they want to change areas or they want to change budget, just do it. That really helps. First and foremost, you know, a client client wants to feel important and special. So the loyalty to them, you know, staying true to your clients, whether you it takes a long time, or it doesn’t, you know, some deals are harder than others remain loyal to them, let them know that you’re there for them, let them know you understand your needs. They’ll appreciate that, too. You know, you don’t want to seem like Hey, I just want a quick buck. And I want to get out of here. I mean, even if it’s a deal you don’t want to do you’re not comfortable with you know, stay true to your client if you took on the responsibility. You know, finish it through the integrity you know, remain honest with them. Don’t don’t push a deal that in the back of your mind is not good for their best interest. I mean, we’re in real estate we know you know where the market might go or we know we might spot something wrong with the house or we might think hey, they’re overpaying and willing to you know, the integrity is huge for me I mean it’s important to building a relationship and building trust and you know, you don’t want to sell someone something that two years they’re gonna not feel they’re going to feel taken advantage of or not happy I mean that kind of falls on the broker so I believe in huge and integrity you know, shaking hands and being truthful and honest throughout energy is big you know, always being positive always been on top of it always been you know, optimistic. There’s ups and downs in real estates and in real estate and I think the clients can can feel your energy when you answer the phone be be happy be positive sound like you’re happy to hear from your client even if you’re having a bad day it’s not their problem you know, they everyone has their own problems always be treat people the way you want to be treated with your energy it’s huge it’s a sponge. Negotiations are huge for me it’s sport you know negotiating a good deal you know, getting the best absolute deal for your client the shortest amount of time for the highest dollar amount or you know, the best negotiation get them the best price dollar minute you want to provide good value for your clients in triumph, you know, being you know, happy celebrating with your client, letting them know that hey, we got a good deal. This is awesome. This is a good chapter in your life, whatever it may be, I mean, it’s, you know, the trophy of over the deal making of of what we’re doing. Sending your client you know, something a gift or thank you we’re taking them out for a drink after to celebrate or sending them a picture of, you know, to put in their place where Whatever it may be, just know and on a good note. So you put all those things together in depth that it really makes for a really solid real estate experience.

D.J. Paris 20:10
Well, I’d like to congratulate you. For number one, having a philosophy I think that is separates you just having something that you were able to, to speak about, you know, very easily and fluently, it also was essentially within your first year is incredibly, incredibly impressive and but it also separates Michael from, I don’t know, I’m gonna be generous and say, or I’m gonna be conservative and say probably 95% of the other realtors, it’s probably closer to 98% or 99%. So having a philosophy where he’s able to articulate and say, here’s what I do for my clients here are the, you know, the the, the six sort of tenets, my values, this is what I promised you is so incredibly powerful, obviously, you have to back it up and do it, as well. However, just being able to explain, this is why people choose to work with me, is going to just separate you and put you in a class, you know, very different from the average broker. And of course, all of those, those values well, when explained make perfect sense, right. So I wanted to congratulate you for even even thinking to have something like that. Right. And by the way, this is on his on his app properties website, he you know, he talks about it, and he just, you know, explained it in more detail here. And I did want to ask you about follow up after the after the sale or after the rental, how do you stay in touch with your, with your clients, obviously talking about triumph and you know, congratulating the win, and the sale is closed and you do something nice for them. Do you have a follow up strategy beyond that

Michael Mandile 21:46
I just nothing set in stone, I just I’ll send them a text here and there, how are you, you know, Merry Christmas, Happy Birthday, you know, just just something small to the point, you know, sometimes your clients will become your friends, sometimes, you know, they’ll be your neighbor. So you’ll see them often. But the ones that are outside of that box, I mean, you you want to, you want to remind them that you’re still there that you know, they’re there, they’re still important to your life to your business. And, you know, just a quick text, a quick phone call a quick email, I think it goes a long way. So you know,

D.J. Paris 22:23
yeah, and to that, you know, these are people that if you’ve, if you’ve done the right thing for them, in your case, I’m sure you must always do because you’ve had such success so quickly. But for all brokers out there, these are the people that want you to succeed the most, right? The ones you’ve helped, and these are the ones that that if you do this great job as Michael clearly does, they reward you with remote and telling all their friends are telling some of their friends or at least one of their friends. And it’s it’s such a huge opportunity. That is it’s really important. And Michael basically said earlier is like every single transaction you have with them or every single piece of communication you have with them, you know really needs to be around their needs, getting them what they want. And, you know, again that that in and of itself separates you from from the majority of brokers I suspect. So uh, we I did want to ask you about either your wild goose chase and key story if you could tell us about that.

Michael Mandile 23:18
Sure. So sorry about that. Um Yeah, so the wild goose chase or so you know, the funniest point I think of my career is I mean it was actually recently we go to a property with a client a buyer and you know it’s winter here in Chicago it’s it’s very cold you get you get your instructions from them where how you’re going to access the property it’s higher is in the loop so we get there and you know we follow the instructions and sure enough there’s there’s no lockbox the car is in loading zone we’re freezing and it became it wasn’t funny at first but you know I get on the phone with the broker Oh go here oh there no lockbox go here she ended up forgetting where she put the lockbox of course so we finally found this lockbox I mean maybe 15 minutes later valleys I mean it was It wasn’t so much fun my client was like What what did I sign up for you know, and we get the lock back then it doesn’t open the codes not right Oh no. We really want to see this property so we then wait to get in you know she’s like well just get in the building and you know go upstairs the doors wide open once you get in you’re fine we get in the doors not open so finally we go back outside open up this lockbox with like our key, you know, it was like jammed and finally get in and the key doesn’t work to open the unit. I mean, at this point. At this point, we’re just cracking off. It was so funny is I guess you had to be there. But

D.J. Paris 24:51
did they end up buying that property or? No? Yeah, it’s like enough bad omens in one day. Move on to the next but it is it is. And again, I think, you know, that’s really interesting, really sort of, not unusual story, right? So like, you’ve been doing this long enough, you’ll have, you know, a story like that, if not many others. And I think the key is to is to keep laughing about it, you know, and while it’s happening, and also to have the empathy for these, you know, these buyers that are like, just wanting to come see this place, and you’re stressed, because you’re having to, you know, run around and everything’s not working. But, but it is, it is amazing that, you know, it’s a real test of like, Can I stay positive throughout this horrible experience?

Michael Mandile 25:40
And that’s, I’m sorry, go ahead.

D.J. Paris 25:42
No, no, no, I just, I think, like, it’s good to have those experiences, because it really tests your resolve of like, you know, Can I can I stay? Can I stay relatively calm? Or even my clients are super annoyed. And then of course, they don’t blame you for it. But it’s, you know, it’s, it’s, it’s tough nonetheless. And then tell us about the snake your snake story.

Michael Mandile 26:04
So we we were showing a house out in the suburbs to a client and you know, it was an older house completely remodeled. We walk inside and everything was off to a good start. Probably the strangest real estate experience in my life. And now we’re looking around and hey, there’s a basements check out the basement. So we go in the basement and it’s pitch black old house, you know, maybe from ninth early 1900s. And you walk down the stairs and starts to resemble a scary movie of sorts.

D.J. Paris 26:38
On like, an unfinished basement on that’s yes, it finished.

Michael Mandile 26:41
It’s unfinished. You walk down? No, like concrete stairs? No, no railing.

D.J. Paris 26:47
I’ve seen this movie.

Michael Mandile 26:50
And you can go on either side. So there’s no wall. I mean, you could go left or right. We get down there. And you know, half of the people that were with us, it was a husband and wife and the children that the wife and the children stayed upstairs, they didn’t want to come down, it’s just dark. So we finally find a light on a string. And as soon as we pull the light string, we see we’re in an empty, unfinished basement, we turn around, and there’s a huge glass enclosure. And inside this glass, glass enclosures a huge snake. Of course, it just, we ran out of there. And it was it was bizarre.

D.J. Paris 27:30
If we can all visualize the light, you know, being like on a string, one solitary light bulb with a pull string on it, and then you turn it on, and there’s a snake in an aquarium. Because who would want to? Who would who would want to put a snake up? You know, ups like everything most people would? Even though if they’re into snakes, they probably would? Well, maybe because they’re showing the house they moved to downstairs or something. But yeah, do you think that that would be mentioned at some point, because that would freak out 99% of anyone who walks through that house,

Michael Mandile 28:02
not the best of staging components, but

D.J. Paris 28:07
that’s when you have to have the come to Jesus conversation with the seller and say, I think we need to move this to another location. or lock it down somewhere where nobody can get to

Michael Mandile 28:18
put in the garage. That’s something but that wasn’t Yeah.

D.J. Paris 28:22
That’s really funny. Well, well, Michael, I really, really appreciate your time. And again, I want to stress as we kind of conclude this, this interview that 73 transactions in the first year is beyond impressive, obviously, Michael’s a super humble guy who, you know, and we’re like, Well, how do you build your business? He’s, you know, I just network and I do a good job. And, you know, and obviously, it’s it is all of those things and and probably a lot more, but this is a truly impressive, you know, broker and obviously big things ahead for Michael. And big things, as all have already happened. But if there are any buyers, sellers or renters that are out there that are interested in working with you what’s the best way they should reach you?

Michael Mandile 29:05
Let me carry on sharing my cell phone directly call text anytime. 847-322-8827 Or you can shoot me an email Michael at Chicago, Lux homes.com, which is my personal website that I work with.

D.J. Paris 29:20
Yeah, yeah. So that website again, is Chicago Lux, which is L UX. So Chicago, Lux homes.com is a place to to read about all things. Michael Mann de les. And so Michael, thank you so much for being on the show. Really appreciate your time.

Michael Mandile 29:37
Thank you for having me. Great, great talk. I appreciate it. Thank you very much.

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Auctioneer, investor, author, and top 1% producer Tim Gray joins us today to talk tax liens! As a real estate broker who saw a huge opportunity in tax lien investing while auctioneering, he has carved out a niche and encourages other brokers to check it out!

Purchase Tim’s book, No Redemption: Tax Lien Auctions, Evictions, and Lessons from the Foreclosure Crisis by clicking here

Timothy Gray can be reached at info@chicagolandauctions.com and 312-334-1300.

Transcript

D.J. Paris 0:14
Hello and welcome to another episode of Keeping it real. The only podcast made by Chicago real estate agents for Chicago real estate agents. My name is DJ, I am your host. Welcome to the show. We have a great interview with Tim gray coming up in just a few. A few quick items before we get to Tim, our website so you can always listen to every episode we’ve ever done stream those episodes live on with keeping it real pod.com You can also contact us, let us know if Is there a broker that maybe it’s you or someone that you are mentored by or someone you look up to, that you think would be a really interesting interview, send us those examples through the website contact form. And you can also subscribe of course to our show via iTunes and Google Play there as well. Also a special thanks to Chicago real producers magazine, which I am a columnist for and write a monthly article based on some of the lessons learned from these podcast interviews. So thank you to Chicago real producers magazine. Unfortunately I can’t share the articles with you because the magazine is sent to the basically the top 1% same people that we interview on the show but appreciate the partnership there. So if you are one of those people who get the magazine you can flip through and look for my articles every month. All right on to our great interview with Tim gray.

All right, today on the show we have Tim gray. Want to read a little bit about Tim for those of you not familiar from this is from the National auctioneer Association. Tim Gray has authored a book entitled no redemption, which is the first book of its kind to explain not only the theories but the real life portraits of people who are affected by tax lien auctions. Tim has been an expert on tax liens for almost 20 years and it is time to share his story. Tim is also an auctioneer conducts real estate and benefit auctions throughout the Chicago land area. He has been a top producing broker for over 10 years. He is a top one percenter have sold 1000s of properties owns lots of properties, and author and we are really excited to have him on the show. So thank you, Tim, welcome to the show.

Tim Gray 2:40
Oh, thank you very much, DJ, it is a pleasure to talk to you. I’m a big fan of the podcast. I think it’s fantastic and happy to lend my two cents to it today.

D.J. Paris 2:48
Well, you you there’s a lot more than two cents that you have to offer. Because this is a particularly unique interview, at least for me and I I claim ignorance to almost all things real estate, which is unfortunate, but probably more true than not very humble. That well. It’s not falsely humble. I think it’s probably accurate. But anyway, let first of all, let’s talk about you know, your start in real estate and how you’ve moved, you know, in in a probably a much different path than a lot of traditional realtors.

Tim Gray 3:20
That’s true DJ, I basically have taken the road less traveled in the real estate world as an also just in my regular life, pretty much my entire life. And a lot of it was the process of elimination. I did so many jobs that I didn’t like, and that I was terrible at. And I worked in the film business right out of college for a few years. And it was a great learning experience. But I could tell that it wasn’t for me. So I think that as you do things you don’t like you start to go, I can’t do that. I definitely couldn’t be a doctor, I would pass out on my first day. Right? It couldn’t be a lawyer. So I realized that and I didn’t like film. So all of a sudden, I got introduced to real estate went to auction school, I became an auctioneer. They started doing the tongue twisters, how many dollars on and give it to get to you know, and we started figuring out how to do this. So we went in, I went to real estate school got my broker’s license became a real estate auctioneer, and pretty much haven’t looked back. I basically specialize in foreclosures and tax liens. My company that I started, we go to the tax sale, the Cook County tax sale and we buy tax liens, which in the period of three or four years will turn into real estate. So I found sort of a unique subsection of real estate and I’ve really just tried my hardest to get as good as I can at it. And that’s really been the passion.

D.J. Paris 4:41
And are you are you originally from this area or from somewhere else?

Tim Gray 4:44
Yeah, I’m from Chicago. So I know the area very well. I’ve seen the changes throughout my life and I lived I’ve lived in other places but I’m definitely a Chicago and

D.J. Paris 4:54
well let’s talk about tax liens. How did you it was it’s just a natural progression as being an auctioneer you saw these opportunities.

Tim Gray 5:01
There’s no question that when I attended my first auction, I was probably 1516 years old, my dad took me to an auction. And that was the moment where I was like, I want to be an auctioneer. And then through that, I got into the tax sale world, I went to the Skaven, the Cook County scavenger sale, which you only need $250 to buy a piece of property. And that was in my price range at the time. And so I was able to buy some vacant lots that on the west side of Chicago, and for very little money, and held them for a period of a couple years. And of them, most of them paid off. And I collected my money back with some interest, but a few of them did not. And I was able to go and get deeds, and sell them to people that built homes on them. And the light bulb went off in my head. And you know, wisely I took that those profits and reinvested it and continued to sort of build the snowball up. And it’s amazing. When I see the progression of how it’s just been hasn’t always been a straight line. It certainly hasn’t been a rocket ship. I’ve had ups and downs like everyone else. But when you look back on it over a course of 10 or more years, 15 years, it is definitely a great feeling to have, you know, paved a nice business model that works in any economy.

D.J. Paris 6:21
Absolutely. And we should also plug your website which is Chicago land auctions.com Yes, thank you visit Chicagoland auctions.com And you can you can learn more about timber Tim, let’s let’s get into so we have 1000s of listeners, most of them here in the Chicagoland area. Almost all of them brokers probably are as ignorant or hopefully not as ignorant as I am with respect to auctions and tax liens. Can you give us a little primer on why broker should care and what opportunities they might might be missing out

Tim Gray 6:55
on? Sure. And I do think that it’s sort of something no one really wants to talk about, or think about sometimes it shows up in the political arena with property taxes. But the reality is, we just paid off the first installment of 2017, which was due not long ago. And on that tax bill. It says Maria Pappas, the Treasurer writes the amount of the state deficiency in budget. And it’s $68 billion, when you see it, and she put it on there to try to ease the blow of the tax bill, you know, that when you see your tax bill, which has gone up, you actually see the condition of the state. And we’re in a we’re in a you don’t need to even watch much TV to realize that we have some problems we need to work out of at the state level. And so the state level funds the county level, and so the county taxes, the property taxes that we all pay, I can’t even begin to tell you how vital it is. And when part of it isn’t paid, that makes that $68 billion, even worse. So you have a situation where collecting the property taxes is actually most important when you have a county that is struggling with money, because we would have potholes fixed, and the schools wouldn’t be closing down because they’re all based on property tax money. So the county tax sale is only once a year. And the treasurer, it takes everyone who didn’t pay. And last use it all up and says we’re going to auction it all off within four days. And it’s done that way to give people an incentive to pay, you don’t want to get involved in the process. So there’s a deadline, a line in the sand, you have to pay it or there’s a tax sale. And if there is a tax sale, you have a period of time to pay it off with interest. So someone like myself will go to the tax sale and buy the tax lien. And I’m actually giving the county the money that they needed. So I’m filling that receivable. And then the homeowner gets about three years to pay that money back to me with interest. And if they do, it’s a handshake, and it’s a win win for everyone. If they don’t, that’s when they would lose the property. And so that’s when it becomes as an investor, it becomes very interesting business because it’s a win win. If you do it correctly, you’re either gonna get paid out with interest, or you’re gonna get the property. And so that’s kind of the 30,000 foot view of a tax sale.

D.J. Paris 9:15
And what percentage of the time in the deals you do, are the owners able to pay? Or are you able to reclaim?

Tim Gray 9:23
That’s a great question. They pay off nine times out of 10. So it’s, it’s amazing. If you bought 10 tax liens, you’re gonna maybe get one, you probably won’t, you’d have to buy like 100 of them to get 10. And so basically 90, they almost all pay off. And so it’s a little bit of a business model where you’re setting up how much you’re gonna get in return and make sure that that’s satisfactory to you for the area and the risks that you’re taking. And then on the backside, you have to know the value of the property

D.J. Paris 9:54
and what you know what type of return interest return. And again, obviously They can vary, I’m sure. But what is there any general guidelines to what? Somebody who’s looking to invest in in these types of opportunities? Yeah, that’s

Tim Gray 10:07
another great question, DJ. Because if you’re in the if there’s a lien in the Trump Tower, and say, the ad and floor, and that actually happened, we bought, I think it was like at GE, in the Trump Tower, and the that went at 0%. There were 50 bidders bid, sure, make sure to them, we’re going to take it at no interest, because we want that chance that Donald doesn’t redeem. And if he doesn’t redeem, we’re going to get this 80th floor condo, it’s worth maybe a million dollars or whatever in our profit. But the truth matters that did redeem, so the lowest is 0%. And the best stuff goes at zero. But then there’s the other side of town. And there’s some boarded up commercial property, there was a there was a car dealership and park for us. It was like $200,000 a year in taxes. And I passed on it wisely. But someone bought that at 18% interest. So if you get down to the stuff where no one really wants, the the highest is 18%, the lowest zero. And somewhere in the middle is where you try to make it work. But again, there are a lot of bitters, it’s a very competitive tax sale, it’s all electronic. So you don’t really know where anyone is at. You kind of have to use algorithms, and we have really good computer people that are far better at it than I am to help me get a good bidding system. So I can stay competitive. It’s it’s actually, it’s sort of like a stockbroker, a futures trader, basically.

D.J. Paris 11:34
Yeah. And it’s like futures, it’s non correlated, necessarily to the rest of the stock market. Right. So it’s, it’s, it’s particularly interesting. And also, it’s such a, you know, this is so interesting. So I always think about from our listeners perspective, so they’re brokers, they are putting, you know, we’ve done a lot of episodes about working with investors. And this is an even a more hyper focused and unique conversation about a very specific type of investment, which yields a pretty nice return or attractive return to investors, you know, a three year return in most cases, right. Which I imagine, you know, meeting in the middle is a probably a decent number to be able to present. Do you find that there are a lot of brokers in this space? Or is it is obviously, you mentioned a lot of competition. But what do you think the average? You know, are there a lot of brokers that are just missing out on this stuff?

Tim Gray 12:31
I do, I think, Well, I think that at the tax sale level, it really is very difficult. It’s a government tax sale, you have to have a lot of money upfront. And then you have to really cross your t’s and dot your i’s. But at the secondary level, the properties that we get, we buy, say 1000s of them a year, and we get hundreds of properties a year. So as a broker, if it were me investing, and I had a client or myself, say $300,000, you could buy one house, on the north side, maybe. Or you could buy 10 homes on the south side. And so for me, I always looked at as a value being a value investor. And I do think that there are a lot of brokers that are all chasing after that one same home run in Wrigleyville, or in Logan Square right now or in Pilsen. But the truth of the matter is, you could go down right now to Calumet City, you can go to Doulton, there’s parts of the city of Chicago, where you can buy a house for $10,000. In my book, I have examples of homes that sold for $1. And they paid the agent $1,200 in commission. I mean, what a deal is that who could stay alive, if you weren’t a big bank, who could possibly do that you’re paying, you’re selling the home for $1 and you’re paying out all this commission. And so there are great deals now, those homes that were sold for $1 They weren’t the most beautiful homes you’ve ever seen. But in my world I look at I actually see nothing but beauty in a $1 home. I mean, even if you’re there’s siding on it, you’ve you’ve got to say to yourself, there’s this is an opportunity for an upside and that’s you know, most financial people will tell you that the the new beginner investor will buy a stock at the wrong time and sell it at the wrong time. So right now your apples doing great, I’m gonna buy Apple and then next thing you know, the iPhone start to explode, the stock takes goes down into the gutter and you sell it. And so I’m always of the mindset and I try to tell the other brokers flip that philosophy and buy Apple after all those phones caught on fire and I’m gonna Of course I haven’t but that’s the Buying Opportunity. And then when it’s never been higher and and everyone’s touting the record profits, then you sell it. So that’s how I’ve always looked at and if you go down into some of the properties that I look at, I buy and sell, they’re all sold as is they’re all sold very cheap under market and we have a lot of of interest but I have to say this morning alone, I got five or six calls from people who found me on Zillow or realtor.com And they said, Hey Tim, can you Come down to Homewood and show me this house, you know, and so I constantly am saying, Please hire a local broker, why wouldn’t you hire a local broker? And so there really are a lot of opportunities for brokers to reach people who are looking for these homes, I realized that that $1,000 commission or 3%, of $25,000, isn’t the type of thing that’s going to get you to your vacation next winter. But you know, our philosophy here is singles win ballgames you keep hitting singles up the middle, you’ll win every single game that you have. And so that’s sort of how I present our business and our real estate.

D.J. Paris 15:38
I think that is really well said, and it’s so interesting that there’s always, you know, seemed we seem to uncover on the show, thankfully, people like yourself are generous enough for their time to express their own take on it and their own niche. And you certainly have, have done that very effectively. Let’s talk about your book, no redemption, because it’s particularly timely. Yes. i with respect to the the auction coming up in May, can you talk a little bit? First of all, where can people find and buy the

Tim Gray 16:10
book? Yeah, it’s on Amazon, or there’s a link on our website as well. But if you go to Amazon and type in no redemption, or Tim gray tax liens, or any keyword, it should come up. And there’s an ebook there. It’s like five bucks, and anyone who’s interested in tax sales, this is not an academic book that’s going to throw a bunch of numbers and legal stuff that you This is my real idea. This is actually what happened over the last 15 years, there’s nothing I mean, the editor took out probably some of the better stories in the book, as you can imagine. But what’s in here absolutely is true, there’s photographs to prove it. And basically, if you if you look at it, you will see a business that has a ton of opportunity, and a number of headaches. And so my idea with the book, my competitors would never, ever offer any advice as to how to do this. And quite frankly, the old school foreclosure tax buyers, they were really cruel. And there’s kind of a new, I’m trying my hardest to change that we’re instead of being the tax bill collector, knocking at your door in a rude way. We are very motivational for people, if we buy your tax lien, we will go to your house, knock on your door in a polite way and say, Hey, realize you’re behind. You have two years, what can we do here to get control the situation before it becomes so expensive, you can’t afford it, and you’ll lose your house. And that type of motivational tactic and not just the aggressive debt collector tactic, really, it pays off in spades for us. And so we’re able to develop a rapport with people. And you’ll see that in the book that, you know, some of the hardest moments of a person’s life would be losing a home that they grew up in, that their parents or grandparents paid for, for the 3040 years, and they all pass away and leave it to four kids who lose it. And for years to taxes, no one pays a single bill. And everyone, you know, is moved throughout the United States. And, and to me, that’s really sad. And so you say to yourself, the really responsible way to handle it is to handle it with compassion, and try to get out in front of the situation. So that that people are not incredibly upset and think that you’ve mistreated the situation. And so that’s what we do, we really take a lot of pride in how we do the work. It’s the passion of our job is in taking a difficult job and doing a really good job of it, you know, and it’s easy, I play music. So it’s easy to say like, I’d rather play music, that’s my passion. But at the end of the day, the passion is doing something really well. And I would encourage brokers no matter what you’re doing, and when you’re doing it, you probably would rather be somewhere else. I mean, I’d rather be on a golf course most days. But if you could just take what you’re doing, and take as much pride in doing a great job as possible. I think you will always succeed. It’s very rarely that someone would let you go or not hire you or promote you, because you didn’t do the best job that you could.

D.J. Paris 19:08
Well, I certainly could not have put that better. And I couldn’t agree more

Tim Gray 19:12
because you do a great job DJ, that’s why take no one.

D.J. Paris 19:16
That’s very, that’s very serving to me. But but the but the reality of it is is I found that to be very consistent that you know, what you just so eloquently put has been said either directly or indirectly by many of the other people almost all if not all of the other guests on the show over time as these top one percenters in particular, of course, are excellent at what they do. They work very hard, very professional. And I also want to go back to a point about the generosity that you very quickly and briefly mentioned, which I think is not to be overstated, is that there are no secrets or there are secrets. Maybe there’s worth sharing, and you’re certain You know, sharing some of the secret sauce today and we couldn’t be more appreciative of that. I mean, there’s, you know, Tim is doing this, just being a nice person, and we do appreciate it. And, and so as with all the other guests we have, and I think that is been a very unique and consistent quality. I met a woman I was on vacation last week in Costa Rica of all places, and I met a woman. I don’t know if you’re familiar with the Brian Buffini training system? I’m not but yeah, he’s so he’s basically the largest independent training center or real estate training program in the countries out of San Diego anyway. So just so happens, this woman sitting next to me she is we’re on an excursion and ATV tour, and we’re actually on the way back from driving ATVs through the rainforest. And I’m we’re dirty and gross. And I’m sitting in this van shuttling us back to the hotel, and the woman next to me says, What do you do and where are you from? And she’s from Atlanta, and she’s a realtor. And I said, Oh, that’s funny. I basically recruit realtors. But I always say that because people might ask me, what’s the real estate market like in Chicago? And usually I don’t have a great answer for that. But I said, she said, Oh, well, you know, I do you know, Brian Buffini is coming to Chicago, and she’s a big Brian Buffini fan. And she uses them in our coaching. And she is and so we got to talking. She’s 72 years old. She does 12 transactions a year averages 20 million in production. Pretty, pretty decent numbers for for traditional real estate broker I thought, and she and she and I said, Oh, well, you know, maybe you’d like to be on the show in the future, because we don’t normally have people outside Chicago, but hey, why not? Right? And she said, Oh, I’d love to but but one thing she said bringing it back to you is she she said, You know, I just I treat this like a real job. And I have my niche. And my niche is I you know, with whatever suburb of Atlanta she lives in, she’s like, I know it better than everyone. And it wasn’t even better than any everyone. She didn’t say it quite that way. But that was what she meant. And she said, You know, I treat this like a job. And I’m I do such a great job that I only have to do 20 transactions a year to hit my goals. And, you know, as a result of that, and she said, I’d love to share exactly what I do every day. She’s like, it’s not going to sound very exciting, right? But, but it never does. But it’s it’s always that that hard work.

Tim Gray 22:25
I mean, that’s why I put some of these pictures in the book of I have a couple bathroom pictures, that you literally look at the book and you will ask yourself, Do I really want to buy foreclosures? This right? Because it’s I mean, it’s pretty hair raising, I’ll be honest with you, but again, when you see the flip side of it, that someone’s gonna buy it, rehab it and live in that home and maybe raise their kids and their kids and do the same thing where they’re the grandparents, parents that took out the mortgage 50 years ago and handed it down. That’s a great feeling. And there aren’t, even if you’re a big investor buying 100 properties. It’s not that many it’s big, every single property is a big purchase. And for most people, I bought my home over a decade ago that was looking back on it a huge purchase, I would have felt a ton of pressure, if I knew I was going to hang on to it that long. A lot of people buy homes. And so we’re in a business where we have to it’s not like a car that people are leasing for a couple years. This is a big purchase for everyone. I think we should all feel very lucky and very blessed to be able to work and have that result for someone. And I get a lot of those calls from people who have made really good money off of our the properties they bought from me. And I always say at least somebody’s making money off of this.

D.J. Paris 23:37
Well, yeah, and I think you’re absolutely and I think from a broker’s perspective, what an amazing opportunity to start to learn about tax liens and to be able to then offer those to investors as another opportunity. I imagine. I don’t I don’t know what percentage of brokers don’t understand or really, you know, bring these kinds of opportunities to their investors or their clients. But it’s got to be in the 90 percentile, right?

Tim Gray 24:03
There’s no like question on the realtor exam about tax liens. There’s nothing in doing education that’s ever come up. No one ever really talks about it. And so but the truth of the matter is, they’re all open to the public. Anyone can bid anyone can buy, and anyone can buy from me, or any other foreclosure tax buyer. It’s yeah,

D.J. Paris 24:22
let’s talk about that. How if someone’s interested in learning more, whether they’re a broker who wants to sort of bone up on the skill on the skills or even just a consumer, where should they go? What should they do?

Tim Gray 24:35
Well, if they want to buy real estate on the back end of the tax sale, then simply contact myself or there’s a number of other people that do Foreclosures And Distressed property. If they’re looking to get into the tax sale itself. A lot of it is public information. It’s a little harder to read, but it’s it’s a statewide statute. Every county in Illinois has to have a tax sale. The rules are laid right out They’re not that easy to read, but they’re right out there. And then you can basically register for a county tax sale, you buy the list of delinquent properties, you do your homework, and you can go in and actually bid on it. There are a lot of pitfalls to it. It doesn’t make the best part time job in the world. There’s a ton of books when I wrote my book that one of the reasons that I wanted to write it is because every book on tax liens was like an advertisement from someone who had never really bought a tax lien. And it was basically just just a snake oil salesman writing a book. And I was I buy them all, and I would read them and just but this isn’t the way that the business is, and there are touting all these huge interest gains you can get and how you can quit your job and all that. But the fact of the matter is, is that this is a full time job, and you’re dealing with people possibly losing their homes, and I don’t think you can really do it, doing it part time. Because what happens is, life catches up to get busy, and you forget a deadline, and every one of your tax liens you lose money on you’ll never, you only get one chance to get it right. And that’s because the penalty is so severe if they don’t pay, but if you don’t do your part, as a taxpayer, you will lose your investment. So a lot of people just depending on their risk assessment, their comfort level, they’ll say, Tim, I don’t want to go to the sale tax sale and wait three years for the property, I want to buy one of these properties today. And my average sale price is you know, 25 to $50,000, which is not the end of the world and people are using now it’s fantastic with these companies that are offering rehab loans and hard money, people are able to do these projects again and get these communities revitalized, that they weren’t able to do for the last 10 years. And it really is great to see it.

D.J. Paris 26:45
Wonderful. Well, let’s plug your book once again, which is called no redemption. So you can find that on Amazon again, search for no redemption. Tim Gray is the author and our guest today. Tim, thank you. So also visit Tim’s website, Chicago land auctions.com. And a lot of great information there about Tim and really appreciate your time today. Tim, this was very, very interesting. And I know our listeners would have loved it, you know, and I just got an education myself. So I appreciate that.

Tim Gray 27:24
Well, I’ll see you at the tax sale and DJ right. I’ll be back next to me bidding. Yeah, I encourage any of the brokers just reach out anytime they want to say hi, I’m downtown in here on LaSalle Street and definitely looking to network and help other people grow. It’s a win win win. We all do business together.

D.J. Paris 27:41
And what’s the best way someone can reach out to you? Yeah, the

Tim Gray 27:44
website, or I mean, I’m on LinkedIn as Tim Gray. The website Chicagoland auctions. You could send me an email say hello. I’d love to hear from you.

D.J. Paris 27:55
Awesome. Well, thanks, Tim. We appreciate you being on the show.

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Andrew Holmes understands real estate investing. After 13 years as a traditional broker he switched to investments and has focused there ever since. In his career he has personally flipped 600 homes and currently has a buy-and-hold portfolio of 180 properties. Three years ago he found ChicagoREIA which is now the largest real estate investment association in the country with over 5000 members. ChicagoREIA brings together the industry’s leading investment experts and teaches members strategies of top investors like Andrew.

Keeping it Real Podcast listeners will receive $10 off ChicagoREIA’s upcoming three day summit in Skokie. Click here for more details!

Andrew Holmes can be reached at 630-635-5996 and info@chicagoreia.org.

Transcript

D.J. Paris 0:15
Hello, and welcome to another episode of Keeping it real. The only podcasts made by Chicago real estate brokers for Chicago real estate brokers. My name is DJ Paris, I am your host through the show. And first of all, I wanted to say continued Thank you, which we do the beginning of most of our shows, but we wouldn’t be here for if it wasn’t for you listening. So our numbers keep going up. And we appreciate that, which means you’re most likely telling a friend because we’re not doing any marketing. So we appreciate that. And if you have anyone else other brokers that you think might find these kinds of conversations interesting and helpful, please pass this along. We really appreciate it helps keep us going. And today we have a really great conversation interview with Andrew Holmes of Chicago Real Estate Investors Association, which you can find at Chicago, ria.org, Chicago are eia.org. And he has a three day seminar seminar coming up, which is called cash flow to freedom, he’ll be talking about it in the upcoming interview in just a few moments. But as a keeping it real podcast listener, you get $10 off the admission price, it’s already very low, but you get an extra $10 off. So you can learn more about this and sign up at Chicago ria.org. I’ll put the link as well in the notes. So thanks again for continuing to listen to and continuing to support our show, tell a friend, tell every broker you know about us, and let us know who else we should be talking to on this podcast we have in the next week or so we have new podcasts with Kerry McCormick, Eric Workman, and a few others as well. So thank you again and onto our interview.

Today on the show, we have Andrew Holmes from Chicago Real Estate Investors Association. Andrew got into real estate at the age of 20 when he was in college, and he ended up selling real estate until the age of 33. And he was solely focused on working with sellers. So he’s basically a listing agent, and he still had his license but in 2008 made the decision to start investing full time. And as of today, he and his business partner have a investment portfolio of 180 single family homes and, and two to four flats. Over the past 10 years. He and his partner have done over 600 flips. And he started three companies along the way, one of which is Chicago real estate investment investor association with over 5000 members in three years, by the way, which is an impressive, impressive growth there. It’s the largest real estate investors association in the country. So congrats to him there. Also, he has two other companies Chicago flipping which is about of course flipping homes, and Chicago cashflow, which is his rental division for his properties. His message to all agents is that, hey, we are in the business of helping others buy a home and invest in their futures. And we as brokers should be doing that for ourselves. He has some we’re gonna be talking about some of his philosophies and practices. And about five years ago, he also started a radio show on real radio, not these dumb podcasts like mine. But he’s I’m 560 am called the answer. And he’s all about empowering investors and agents about how to build their wealth through real estate. So we are so grateful to have Andrew Holmes. So welcome, Andrew.

Andrew Holmes 3:41
Thank you, DJ. Glad to be here.

D.J. Paris 3:43
Well, thanks. Thanks for taking time out of your day. And tell us a little bit about and I mentioned a bit of your journey there. And that’s quite a journey. Very impressive. Tell us a little bit about how you got started.

Andrew Holmes 3:57
So in college, you know, I was always the kid that all my friends went out and got drunk, and I went out with them. And I was counting the number of people in the bar trying to figure out how much the bar was making. It was I was always kind of since I was a kid. That’s just how my brain work. My college days, I was trying to figure out, how do I become rich? I mean, really, they asked me to pick a career. I’m like, well, whatever makes the most money, that’s what I’m going to do. And that was kind of a tough one for the counselor to he’s like, but what are you passionate about? Well, making money because I’m really broke. So I don’t want to be here. So that was kind of the you know, I didn’t know what exactly entrepreneur at the time meant, but sure, apparently that somewhere came in built.

D.J. Paris 4:44
And and so you really started in at the age of 20. What was that like getting your license that early?

Andrew Holmes 4:50
And I was like I went to this really small school and there were a couple of people who drove really nice cars. And when you’re 1920 years old, a nice car seems Like someone who is well off, and some are who were through the grapevine I heard that they owned a lot of Earth’s real estate. And I used to check out a lot of books, blah, blah, blah. So I’m like, well, that must be the common thread. And really, I thought I was going to get a real estate license, I was going to be a successful investor. And that would be a great summer job and supposedly make so much money that I would be set for the rest of the year. You know how that story starts. So that was I mean, I was so naive that, as you can imagine, the first two three years were rough to say the least, you know, so?

D.J. Paris 5:35
Oh, sure. Yeah. How, you know, as as a young agent, how did you? How did you drum up business I imagined, it’s, you know, none of your friends are buying, buying and selling at that age, I imagine.

Andrew Holmes 5:45
At the time, I was in a really small town about the population, I think was about 30,000 people. And I mean, somewhere I got hold of some, like old cassette tapes. And they said, you should just cold call people. Sure. And I mean, I used to be so nervous calling for sale by owners expired listings, is to forget my own name. So I used to kind of sweat bullets. I had no idea. And I mean, I remember how painful it was, but I didn’t want to. So my parents happened to live in India. And when I left there, I had told them that, you know, one day, guys, I’m gonna be a multimillionaire, and they happen to be both the surgeons, and so I told them, I’m going to show you guys and, you know, I did not one thing I never wanted to do was go back to my parents, and say, I failed. And so it didn’t matter what happened. I had to make it. And so for 234 years, I really didn’t communicate with them much. Because I didn’t know what to tell them that I quit college, and I’m trying this whole real estate thing. And I mean, literally, I built my whole business on literally calling for sale by owners expired listings, and canceled listings.

D.J. Paris 6:55
And we should we should like not move on quite yet from from that statement, because that is it’s probably the hardest cold call there is in real estate, I imagine. And certainly not for the faint of heart. You’re calling people who either have have had bad experiences with realtors, or are just I don’t want to pay those Commission’s and basically trying to turn those into clients. And those are Boy, that is a real trial by fire. But I suspect if you could make those calls. After that

Andrew Holmes 7:24
just interesting. It’s what happened was literally I mean, what happens is initially when you call people do obviously hang up on you because you don’t know what you’re saying. And literally you come to a point where once they know you’re truly there to help them. Yeah, and serve their needs. I used to call people 1015 times, and literally and they’re like Andrew, you realize you called us a week ago. And like guys, I’m not calling to ask for your listing. But if you do think of an agent, I want to make sure that if I’m willing to work this hard now, how hard do you think I’m going to work when you actually do put me to work. And literally they used to call me and go you know something you’ve been so damn persistent, that my sister in law is an agent, but she will never work as hard as you do. And, and it was literally that was my secret was that I was like, just not a bad dream, but a good dream that just would not go away. And I was persistent. If they couldn’t sell it out, literally go tell them what to do to get their home sold. And what I figured out was after a while people figure out that you’re genuine about what you’re trying to do. And that catches on and it was first people would look at you like strange. They’re like, What is wrong with you? Why would you help us? I’m like, Guys, it’s simple. If you sell it yourself, fantastic. We should have asked if you don’t just please remember that I’m here. And a lot of times people would this is, you know, in the 90s and the 2000 or two up to 2000 678. So obviously a lot of people did succeed, kind of selling it themselves or do whatever they did. But I mean, I was I moved to Chicago literally in 2002. And starting in 2002. At a time, I used to always carry 40 to 50 listings at a time. And that’s all I did. I think I had maybe 10 or 12 buyer controlled transactions. And that was it. And every single thing was pure logistics.

D.J. Paris 9:14
Wow. That is and there are so many brokers and I was mentioned to you offline, we have 1000s of listeners, you know, all of which I assume are brokers and they would kill to have that number of listings. But they what they probably wouldn’t do is make those kinds of calls. And so I really applaud you for oftentimes when we talk to top producers on the show, and we say what you know, what did you What do you do so differently? They always say generally, it’s almost always it’s not really anything different. It’s just they’re willing to make those types of phone calls and or whatever that particular activity was. It’s it’s always kind of like I call it like those those types of things like cold calling expireds and for sale by owners. They’re really I kind of call them like the push ups of real estate. They’re like it’s a really simple exercise, it’s not easy, but it’s a really good idea. But it’s one that we all go, Yeah, I should do more push ups, and nobody very few of us ever do them. So I applaud you for doing that. And as a result, Boy, that’s a pretty impressive, you know, start with, you know, that many number of listings. So then what made the shift from that into investment?

Andrew Holmes 10:21
You know, so what happened was this, I had seen my parents, like I think mentioned, when we got started, both of my parents fortunately, did very well for themselves started with kind of nothing but got a very good education. My dad happens to be able to pick surgery, my mom was OB GYN, gynecologist, and it’s the old school in a way of thinking you have to study hard work hard to make something of yourself. And it did. I mean, they have a lot of recognition, they’re very well, you know, all the things that kind of come with being a very successful surgeons, for me, what I always bothered me was this, that I had friends whose parents had way more than we did. And yet, they didn’t have the level of education. They didn’t write as many hours. But the difference between them and my parents was my parents were always running on a treadmill. Now, it was a very fancy treadmill, mind you. Or if you’re a gynecologist, OB GYN, you’re it’s a very fancy treadmill, Georgia problem still is that they have to show up to get paid. Yeah, they’re, they’re trading hours for dollars, for sure. Right. And what I realized was at real estate, I mean, we’re like purebred athletes, if you’re, if you want to perform at a high level in real estate sales, you have to grind it out. I mean, I wish, at least I don’t know. I mean, I’ve always looked at a lot of top producers, they don’t overthink things, but they have something they have very good at due diligence in terms of follow ups, as they keep, in fact, I mean, they go from I mean, in my business change, going from 100%, cold calling to, you know, to 80% to 60% to 40%. Because you start calling the people, you know, after a while, you don’t have to do as many cold calls to produce way more results. But still, January 1, or December 31. Christmas time was a very painful time for me, because even though I had done well for the year, and I was one of those people who wouldn’t spend money, and put as much money in stock, stock and away as much as possible, but still, I was not sure if I could repeat that performance the year over, right, you know, the next year, the next year, because the calendar gets reset. And, and that’s the reason I was I always had this thing in my mind that one day, when the market is right, I’m gonna jump in. And that day came January 14 2008. I mean, that was literally the date. So Wow.

D.J. Paris 12:46
And and what, how did you start to learn about investing? Was it just information you picked up along the way? Did you read books? Did you tend

Andrew Holmes 12:54
to read books, I went to a lot of different kinds of meetings. And a lot of clients, I lost a lot of clients, because I tried to tell them what I believed, which was don’t buy stuff without cash flow. Sure, and buy things and hope to go up. You know, I mean, I pray all the time to get taller, it doesn’t seem to happen. It’s I’m still short, I mean, you know, appreciation obviously happens over a period of time. But you can’t predict build a predictable business on it. And what I saw people doing from 2000, in 9899, and 2001, all the way through six was they were buying buildings where they were losing money. And the idea was, well, we can lose money for two, three years, but it’ll be worth two or three times as much. And we can get rich, and they got caught with it. And I saw that. And I saw it as I mean, I had the front row seat, because sure some of those were my clients and I sold them the property. And I sold the property again, when it went into short sale. I mean, it’s sad, but it’s and for the first time I realized, you know, that there’s something happening, and it’s right in front of me. And if I don’t get on the field, I’m going to miss this game. And so that was kind of my thing. And it was scary. I mean, it was very scary in 2008 to be jumping into real estate sales when everybody was losing their shirt.

D.J. Paris 14:18
Yeah, yeah, I imagine it was it was scary. It’s funny I’ve heard by more than one person more than a few who have said never think of your primary residence as even an asset much less than investment unless there’s there is cashflow which probably there isn’t if it’s just a primary residence, but like they said don’t even put it on your asset column because it really it costs you money. It’s an asset on the day you sell it. But also you have to live somewhere to so likely and certainly don’t don’t think of it as an investment and you know, it’s anything it’s going to suck money out of you year, you know, month a month over month. But that is a really, really, really intelligent thought. ought to, to only want to have, you know, assets that that make money for you on a, you know, residual income basis, which is obviously what you get into so as as you bought your first property in 2008, then sort of how did you?

Andrew Holmes 15:12
How did you know what to happen was, it’s like, again, sometimes, you know, will you shoot for something, and you kind of miss the target yet it’s taking you somewhere. So what I did was, I had a great treadmill, which was selling real estate, and it was, I mean, I was very blessed, that after a lot of struggle, I did figure out my niche. And it’s very, very rewarding. I mean, I don’t know, any other profession where you don’t have to have a college degree, you have to kind of put your head down and go to work. And you can make, you know, 5060 100 200 400 500,000 bucks, a million bucks, literally. And it’s, it’s so I always feel very blessed that I didn’t pick real estate, real estate picked me, that’s how I feel about it. But what happened was, you know, I got off one treadmill, which was sales, and I got on a more stressful treadmill, which was doing flips, so 1008, through 2009, and 10, all I did was just pure flips. So I buy a house rehab, get it rehabbed and resell the property. And when I was a listing agent, I only listed properties less than 450. Because I was in the Schomburg market, surrounding areas. So I always wanted bread and butter properties and never wanted a big house to list because the turnover was an issue. So that’s what I did in terms of flips, that I dropped down the price and the median price range. So I was buying properties at, you know, 100,000 or 50,000, flipping them at 250 300. And I just did a heck of a lot of it. And then I finally realized that I had gotten out of one treadmill, and gotten on another treadmill. Now, if it rains four inches outside, now I don’t have to worry about my customers or clients house, I have to worry about my profit. It’s very true. And so it creates a different level of stress. And finally, I had a friend of mine or somebody who I have respected immensely for a long period of time. And what he said is because I was asking him kind of the lifestyle, I looked at, well how he lived. And I’m like, How is this possible? He’s like, Well, back in the SNL crisis days in the 80s, he had bought quite a few houses in California, about 80 or so houses, and he had paid all of them off. And he’s like, you realize, every single day, the tenants go to work, and they read on a treadmill, they run on a treadmill, so I don’t have to write. And that’s the first time when it struck me. I’m like, instead of selling some of these properties, how about if I flip two properties, and keep one, flip two and keep one and so I started that process, which was I would flip to which was kind of money to live on and invest some of it in a rental property. And then as the kind of stage started growing over time, I could keep three rentals only flip one then keep for rentals, only flip one. And that just equation over the years has obviously kind of grown so.

D.J. Paris 18:12
And with your buy and hold properties. Do you focus in one particular geographic area? Are you sort of looking all over? Or do you kind of keep it localized?

Andrew Holmes 18:22
So I started buying basically, for people who are familiar with Schumacher, from Chicago area sure around Chombo. Market Schomburg I consider as a a market economically. So because the houses are expensive, so the market right next to it, which is going to be a more bread and butter market economically, you get relatively good rents, stable long term tenants, we don’t rent to anybody less than two years. So minimum two year rentals, if not three, and four. So it’s impressive. Yeah. So I mean, that’s just that’s kind of the philosophy is that if you live in our property for five or six years, we’ll send you on a vacation for your entire family anywhere in the world. As long as you live there six years. Wow. Because they’ve paid down my property. What’s your results? That’s wonderful. You know, so if we can give them a reward of for $5,000. And okay. So, right. Philosophy has been is buy the property, rehab the property, rent the property, refinance, the amount of money that you invested in the property, and every month, you have four to $500 net cash flow, after all expenses.

D.J. Paris 19:29
Yeah, my boss has a very similar philosophy. He, he owns, I don’t know 2025 properties, and has that same philosophy. He just He goes, I want I he wants to net 1000 every month and so that’s his goal. But if it’s 500 He’ll he’ll do it. But yeah, he he always, you know, is able to figure it out. I think that that makes a ton of sense it also to when you’re working with these tenants who are signing multi year leases, you probably probably I mean maybe maybe this isn’t true, but I would assume they probably treat the property Be a bit better, since they know they’re gonna be there for a period.

Andrew Holmes 20:02
And we were very, I mean, we’re fair to people. But we’re equally tough with everybody in terms of that we don’t want. We want good tenants, we want people who will take pride, because we provide a nice clean home for them. And we are prompt in terms of repairs. And so but we’re rigorous in terms of how we do all the checks in terms. So most people who basically, you know, don’t meet our standards, we’re not going to we run it like a business. I mean, that’s the difference with how we run that business is that this is a business and we pay attention to that business. So and the philosophy kind of what started was that we were talking about 257. So my goal initially, was in two years, I wanted to own five houses. And I wanted to get them paid off as quickly as possible. Because I, we take that, but I don’t like long term debt, because to me, it’s just a noose around your neck. So what my philosophy is that in two years, any person normal person can buy can learn how to buy five houses. And if they buy it with the right numbers, about four of them will get paid off completely in seven years, maybe not the fifth, depends on how aggressive you are with your payments, but you use all the cash flow to pay the property off, because there’s a basic philosophy in real estate that I believe and that is that if you take care of real estate for the first five years, real estate will take care of you for the rest of your life. Right. But the first five years are critical.

D.J. Paris 21:36
Yeah, wow. I absolutely, absolutely agree. And, you know, that brings us into your your association, which is the Chicago Real Estate Investors Association. And this is really important because it because I know you started about three years ago, and it’s funny that that we’re talking about this, because I noticed that there really there was one other group that I was familiar with. And I think this is even before your group founded. And they were way out in the western suburbs, and I don’t, you know, they had a pretty sizable group. But But there really was, was a wasn’t any other cohesive group. And I said, somebody’s gonna come along and build a really impressive investor Association. And you’ve done that. Can you talk a little bit about about year this? Chicago, Rei?

Andrew Holmes 22:23
Yeah, so So basically, kind of how that started was that I went to other groups, I attended the meetings, and it’s like, you know, hiring a coach or hiring a trainer at the gym, that doesn’t kind of follow what he preaches. And that’s what I saw with a lot of these groups that they people talked a great game, they would never share any information. And but they didn’t have the results to kind of prove what they said that they were doing. And I was kind of trained by somebody in real estate, who basically, basically, it was very against Bs, and I just absolutely couldn’t stand it. So really, that was kind of the thing that I lacked a connection with people, where I wanted to get a group of people together with similar mindset with similar thinking people who are not afraid of sharing ideas, thoughts, and openly creating a forum where we can as a group can grow. And I’m of the school of thought that, you know, the five people you hang around your net worth is basically your net worth is equals your net worth. And so that’s, that was basically the basic philosophy. And that’s really how we started was a group of people who I knew, and I was like, Hey, guys, let’s get a lot of experts in the area. And let’s provide great information and try to get people to take action.

D.J. Paris 23:51
Yeah, I mean, before Andrews group, it was a lot of meetups at a local bar, a handful of people would show up, and somebody really needed to come and create something with structure. And so they did that. And we should talk about your upcoming summit, your upcoming conference, which is in Skokie. It’s February 16. Through the 18th says the three day event. You can learn more about it at Andrews website, which is Chicago are eia.org. What else would you like to talk tell the listeners about the about what the Learn at the summit?

Andrew Holmes 24:21
You know, so the three days of kind of divided into day one is all about acquisition? Where do you find transactions and more so rather than retail transactions, where do you find those transactions that have 2025 30 35% 40% equity in terms of when you buy a property because because really, anybody can buy a property at retail price that doesn’t require skill. What an investor is looking for a is a good deal and good deal by our standards is somewhere where there is 30 35% 40% equity, and those today are that’s the art of investing which is if you can find I find a great deal, you can literally not do any work and sell it for a profit to somebody as a retail sale, you can obviously do a fix and flip, which is rehab it, or you can keep it for rental forever. So that’s kind of the focus they want. So we’ll talk a lot about pre foreclosures, still bank owned inventory, still a lot of off market, landlords deals

D.J. Paris 25:23
and, and to not just interject before you get to the second day of your summit, but it’s important to note that, you know, brokers who are who are most likely listening, you know, often don’t know what’s beyond the MLS, not that these properties, they may be on the MLS, but likely, there’s possibility they won’t be. And so I imagine you’ll learn alternative strategies for finding these these types of properties.

Andrew Holmes 25:45
Exactly. DJ, you know, it’s interesting, because I was trained in that mindset, right, that picks up on MLS, I didn’t know anything. That was really and it was great till two, till about two or three years ago, I didn’t have to look any other place, I could find phenomenal deals on the MLS all day long, because I was used to working the MLS all the time, yet the market has changed. So that’s kind of day one. And then that day will, what everything that we talk about, we want to bring examples of people that anybody that says, Well, I can’t do it, because I can show you an example that has beat the odds and still succeeded. And so we’ll start with somebody last year, who bought five properties to 15, to 20, to 25. To 30, by the end of the day, what we want people to say is okay, there is no excuse, the excuse is the one I make. Day two, we want to step it up, which is we put people on, we hire about five school buses, and we put people and we send them to properties. These are not for sale, we’re not selling those when I’m trying to get rid of the properties. The intent of that is we want people to look at properties that are right in their neighborhood, they may live in those neighborhoods. And there are properties that we own. I mean, it’s kind of interesting that just out of a group of about 300 people at Chicago Ria, right, there’s over 3000 properties that are owned by just a small group of investors. And it’s phenomenal how many great properties come up all the time. And so the reason for that bus tour is to kind of show the reality of what goes on what type of rental properties you should be looking at, and what type of flips you should be looking at. And then in the afternoon, all we talk about is numbers, numbers and numbers. Because really, that’s what kind of makes this business run, which is purely numbers. So day two, is purely based on flips. And we’ll have people who do small 30 $40,000 profit flips. And then we’ll have people who do complete rebuilds remodels, new construction, you know, 100 $150,000 markets, and we’ll kind of show the difference why a certain strategy works better than another, and how many transactions that really are in our area right here in Chicago. And then the day three is really kind of the big boy network, which is that is all about 257. What our goal is this that if your need is, let’s say somebody says, well, I need to make $10,000 a month, that’s my, you know, my outlay every month is 1000. So we’ll say Okay, raise it up by 20%. So that’s going to be 10,000. So you need about 13 houses to make sure that for the rest of your life, you have $10,000 that comes in doesn’t matter if a renter pays doesn’t pay, you still have enough income. And that’s what we want to build to on that date. So from the morning, we start with regular lenders that will come in, then we’ll have private money lenders come in, then we’ll have commercial lenders come in and we start building that up. And in the afternoon, we have attorneys come in talking about asset protection. So it’s about building a business, what the three days are about is that how do you build a sizable business? And how do you do it quickly, safely and with experts that are local? I mean, the great part about living in Chicago is there is real estate literally still from $30,000 all the way to 234 million. The question is what are you going to do with it?

D.J. Paris 29:02
Yeah, and I think this is such a such a great conference you’re putting together because even if the listener out there as a broker who he or she does, maybe does not want to invest themselves which which Andrew would tell you to do too, you should learn to invest yourself but even if as a broker you want to work with investors, you are now going to have the skill set of exactly what that investor is looking for. And there are so many brokers out there who whether they want to invest themselves really do want to work with investors that you know, and and that this this will give you that exact skill set to to do it yourself and also to find other investors and also be their broker.

Andrew Holmes 29:41
Nikko is going to mention that because so many, I mean some of the big names in lb that have huge businesses built on investors. I happen to be some of the speakers at the three day conference. You know some of the big REO brokers from Ryan Smith with classman office A bunch of people, Frank Montero a bunch of people that are brokers that have specialized in that but you know, our most successful people at the Ria, almost every one of them has a real estate license. Right? They like a lot of times agents will come, they’ll look at it, they start selling properties to investors, and they’re like, Oh, my God, right? I don’t I keep few of these for myself. And that light bulb goes on. And it’s awesome to see that happen. Because now not only are you serving the public, which is helping them find a home, you know, home of their dreams or building a portfolio for themselves. But now you’re, you’re basically practicing your own message, which is you’re doing it for yourself, which is the best service you can do for you and your family.

D.J. Paris 30:47
I don’t think it could be it could have been said any better. Well, let’s, let’s plug the website one more time. So in order to get more information about the conference coming up, and also the regular meetings for the Chicago Real Estate Investors Association, visit Chicago, R E, I a.org. There’s a good looking website with a lot of great information about upcoming events and how to get more involved and more educated about investments. Andrew, if there’s anyone out there who would like to reach out to you directly to get more information, or to even maybe work with you what’s the best way they should reach out?

Andrew Holmes 31:24
I mean, a couple of things. Number one, the number is 847-303-5011, or Chicago, ria.org. And anybody that calls from your show that listens to the show, and comes to the conference, just all they have to do is just mentioned that or just email, Chicago Ria. And we’ll give them it’s only 39 bucks, but we’ll give them another $10 off just as especially, I have a special kind of, you know, soft corner for people who are real estate agents, because I’ve been in those shoes. And it’s a wonderful opportunity that we have at our fingertips. The question is, what do we do with it. So it’s something that if you’re not going to take advantage of it, learn how to work with investors, the last year 25%, of Chicago market was investors. And there’s a shortage of people who are good at working with investors, and you can get 5678 transactions from one investor. So if you pick the investors properly, it can be a wonderful means not only for building wealth for yourself, but for multiplying the amount of transactions with less effort.

D.J. Paris 32:35
Absolutely. And I was just thinking back to when you said, most of the people, almost all the attendees have their license? Of course they do, because you’ve told them go get your license, save the commission. So this is

Andrew Holmes 32:46
we actually don’t you know, we discourage people, what we have always believed is this that, in fact, if anything, I always say, if whoever the listing agent is work with them, let them earn the commission, you know, and what I’ve always said is that once you find a good broker, a good broker is worth their weight in gold. I mean, this is something I’ve always had this philosophy, because this is, especially great deals, great deals come by and when they come by, if you want to be the first person, you cannot be chasing commissions, you have to chase the deal. And let the agent who has listed or whoever you’re working with be fair to them. They’re putting in time they’re putting in effort, right, let them make money. Yes, focus on the deal. The reason for having a license, as far as I’m concerned, is only one reason access, that’s it.

D.J. Paris 33:34
Sure. Sure. So yeah, you get access to the MLS and right and other properties. That’s a that’s a very good point. And so is there an email address that people can can reach you out?

Andrew Holmes 33:46
Absolutely. It’s info at Chicago RIA R E. ia.org. That’s info at Chicago ria.org.

D.J. Paris 33:56
And let’s also mention your radio show which is on 560 am the answer how often and when can people hear you on on five? On 560?

Andrew Holmes 34:05
Every Sunday at 12 o’clock noon to 1pm on AM 560 WMD

D.J. Paris 34:12
Awesome. Well, Andrew, thank you so much for your time. This has been a really fun conversation and I hope everyone listens. Gosh, for 39 Or I guess $29 to go attend this three day summit in Skokie is is kind of it seems like a no brainer. So everyone should go sign up for it. And thank you so much for being on the show. Love being

Andrew Holmes 34:33
on it. It’s a great it’s one of the best podcasts I kind of was privy to listening to it through Rosario, who you had on slick invest. And Ryan from renewable. Yes. And, and so I mean, you guys are doing a great job. So I think we might ship needed some. Well, everyone

D.J. Paris 34:53
go and register at Chicago rei a.org. Go to the summit in February or sign up for their you know, regular meetings. Obviously, Andrew is a wealth of knowledge and he surrounds himself with experts who come and are part of that organization to help clue you in on what you need to know. So thank you so much.

Andrew Holmes 35:12
Great. Thank you so much. Did you have a great day

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Odds are if you are a real estate investor or have clients that invest, you’ve heard of Brie Schmidt. In addition to running her own firm, Second City Real Estate, Brie is a featured speaker at many real estate conferences. On BiggerPockets (the largest real estate forum in the country) she is recognized as one of the most prominent experts in the buy-and-hold space. She manages over 90 units of her own and teaches others how to do the same. This May she will be hosting the Midwest Real Estate Networking Summit in Chicago with 20+ speakers and 300+ attendees!

Brie Schmidt can be reached at brie.schmidt@gmail.com and 847.312.6043

Transcript

D.J. Paris 0:15
Hello and welcome to another episode of Keeping it real. The only podcast made by Chicago real estate agents for Chicago real estate agents. My name is DJ Paris, I am your host, and just wanted to say thank you for continuing to listen and support this podcast. If this is your first episode, we interviewed top producing brokers in the Chicagoland area to ask them how they became successful have them tell their story in hopes that other brokers who are interested in increasing their production, getting to those high levels can maybe learn a few things. So we appreciate you paying attention to these episodes and listening. Also, we’re always open to suggestions. So if you have any ideas of how we can make the show better, or other brokers maybe we haven’t yet reached out to, you can definitely send us a note. And you can find us on our website, which also has every episode we’ve ever published streaming live there, which is keeping it real pod.com. So definitely visit there. You can sign up, you can get emailed every time we publish a new episode. Please also subscribe on your phone on your podcast app, whether it’s iTunes or Google Play or any other podcast app, you should be able to find us. And also we do send out information on our Facebook page, which is keeping it real pod. So look us up there. We have an interview coming up in just a few moments with Brie Schmidt. So thank you again for listening and onto our interview.

Okay, today on the show, we have Bree Schmidt and I actually have known of Bree and I believe I have spoken to breathe and once prior she’s she’s was at the very top of our list when we first started this podcast about people that we wanted to have on the show cuz she’s so interesting and super fun, but let me tell you a little bit more about Bri. Bri started purchasing investment properties in 2011 when she founded the BBS apartments, and she currently owns and manages over 90 rental units in Chicago and Milwaukee. She is the managing broker of Second City Real Estate, a boutique brokerage, working with real estate investors who want to start or add to their buy and hold portfolio. Second City Real Estate is a brokerage comprised of buy and hold investors that specialize in assisting buyers to acquire two to four unit residential properties in Chicagoland. They leverage their experience educate clients about all aspects of the investment process. They teach how to analyze potential properties, calculate return on investment, advice on best landlording practices, how to effectively market and lease rental properties. They work closely with clients to understand support and help execute real estate investing goals. Bree is also a top producer. If you are a broker and you are involved in bigger pockets, Bree is all over bigger pockets. She has been a guest on a tons of different podcasts. And she speaks she does everything. So we’re so excited to have her Welcome to the show.

Brie Schmidt 3:11
Thank you for having me.

D.J. Paris 3:12
Well, thank you because you are incredibly busy. And you are right now you are in the process of planning a real estate Summit. Like was it a three day summit or might might even be longer, right?

Brie Schmidt 3:22
It’s a three day Summit coming up in May. That’s going to be in the Chicago market. We’re locking down contracts on dates and venues currently up and it’s gonna have 300 over 300 attendees. And it’s going to be an educational summit for different types of investors, either you know, newbies looking to get started to experience investors on how to navigate investments in the Chicagoland area.

D.J. Paris 3:47
And if you’re interested in getting up to date information about the the summit go to Midwest ar e summit.com. So Midwest RV summit.com. But brief, I want to go all the way back to the beginning of your real estate career. And tell us a little bit how you got started.

Brie Schmidt 4:05
So my story is a bit untraditional. I started the idea of real estate started when I in 2000. When I was 17 years old, my parents were selling their house and the I remember coming home from school and the agent was over. And she was at our you know, kitchen table signing the contract with my parents. We just got to talking and she was a very successful agent in the suburbs. Very like the mom on American Beauty type, you know what I mean? And was like you are destined to be in real estate. I was like really? And she was like huge. Like, I’ve been doing this for 40 years, like you are going to be the best real estate agent ever. And I was like, sure that sounds like a good idea. You know, and I hadn’t had any plans for college. I really wasn’t sure what I was going to do with my life. So at the time I said I was 17 the state laws that I couldn’t be licensed till I was 21. So we actually tried to get me an exemption as soon as I turned 18 To let me be lice. Since when I was 18, but didn’t go through. So I worked for her as an unlicensed assistant, a few days a week for a few years, and didn’t go to college. Because you know, as soon as I turned 21, I was going to be this top real estate agent, and it was going to be awesome. And, you know, I took my classes when I was 20, I took my licensing exam, like the day I turned 21, I quit my job to be a full time realtor, and I hated it. I absolutely hated it. I think I had maybe two or three closings and I was out within nine months, I found it really, really hard to be 21 years old, and to communicate to people effectively as a, as a position of someone who is experienced and trusted. Because I was so young, A, B, I also didn’t realize at the time, I didn’t realize I was older, that I just don’t communicate on an emotional level. So it was really hard for me too, to see eye to eye with people when I remember, you know, showing them three houses. And I was breaking it down based on like, here’s the cost per square footage. And here’s what makes the best sense from an appreciation standpoint. And they were just coming to me and saying it doesn’t feel like home. And I couldn’t I couldn’t really relate, I was also gotten to emotionally immature at that point to really understand how to communicate effectively and get my point across. So by the time I was 22, I was already out of real estate. And I went into advertising sales where I stayed for about almost 10 years and built a very long term great career doing that. During that 10 years, though I always held my license at a holding company, I always said you know, my job was always you can get fired from sales at any given point. So I was like, Well, if I ever get fired, I could always go to residential real estate or do leasing, my license is still active, that was always going to be my my backup plan. It wasn’t until 2011 When I started looking for properties with my then fiance. And, you know, we started planning out our life and you know, where we wanted to live in the city, what we could afford, and investment properties came up as an option. You know, so at that point, it was just the two of us, we didn’t have any kids, we didn’t need a single family house. But we also didn’t really want to buy a condo, and the two to four unit came into play. So we bought a three unit and Albany Park with the intentions of you know, we’re gonna live on the top floor. And then the way that the layout is, it can be quite easy to eventually D convert it to one single family house just moving a couple of walls, but the staircases would be existing. So we’re like, Okay, well, when we’ve got a couple of kids will, will duplex down and then we’re gonna need more space, we’ll we’ll do Plex down to the basement. So it was never an intention of being an investor or buying more properties. The original intention was like, Oh, we just will buy a house that we could eventually grow into.

So that’s how it kind of got started. And I was like, I was still working full time in corporate and really didn’t think much about it. It wasn’t until about a year after we bought our first property that we had a death in the family. And we had a my father passed away, literally one day before he was supposed to retire after 25 years of working in the post office. And, you know, he always talked about when I retire, I’m gonna go do this. And when I retire, I’m gonna go travel here. And it really hit us hard that, you know, we might not we always talk about retiring when we’re in our 60s. But what happens if you don’t get there? You know, and what kind of life are we living now, where, you know, God forbid, we take our whole two week vacation at the same time. That’s how corporate works. So that’s not the lifestyle that we want for ourselves. So it really impacted everything to be honest, and kind of changed the path of our thought process of, you know, what do what’s our ultimate end goal, like? What do we want to accomplish out of our lives? Do we want to, you know, not have to put our kids in daycare when they’re three months old? Do we want to be able to travel and not have to worry about how much vacation time we have, you know, what happens if one of us loses our jobs? Right? How are we going to be able to financially sustain that and sat down and really thought about like the next 510 1520 25 years of our lives? And the answer was real estate for us. You know, we we looked at a couple of different things. But once we decided that real estate was what we were going to do, we kind of created a plan of how to accomplish that. So it’s kind of crazy. And I always talk about you know my six year this was six years ago so this was August in 2011. When we bought the property it was July in 2012 when the the passing happened my my father I have six year old self would be in awe of where things have gotten today. And none of this was really intentional. Like, it all just kind of snowballed to where it’s at. So, now I own 31 properties, I have over 90 units, I quit my job in 2014 to run the business full time, my husband retired in 2015. So it just kind of snowballed to the point where it’s at today.

D.J. Paris 10:26
And how did you transition from buying, you know, the first property the three flat to then your second, you know, because again, the first one wasn’t necessarily an investment, the intention and intentional investment. And then when you guys made your plan, how did you? How did you figure out exactly what types of investments you were going to focus it on?

Brie Schmidt 10:46
Um, that’s a really good question. I had no formal training, I had never read, I never talked with another investor, I had never read a book about investing. It was all just what made sense in my head. So luckily, I made smart decisions. It could have completely like now that I know what I know now. And now having done this so many times and work with so many clients to do this, like, I was playing with fire back then, I could have really made some really stupid bad decisions. And, you know, in this adult game of Monopoly, like I call it, we’re talking about 10s of hundreds of 1000s of dollars here, it’s not like, Oh, I lost, you know, 20 bucks, it’s like a screw up can lose you $100,000 No problem. So the second one is the, the passing in my family, it happened in July of 2012. By October, we started looking for our second property. And we we closed on that property in December of 2012. So we moved quite quickly, and is that it was all just based on numbers. i It’s actually a kind of a funny story, I was under contract for three unit in Bucktown. And at the end of the day, like I made the verbal offer, I was ready to make the the official offer, I started to have doubts. And I was like, You know what, like, I think this property is actually really high priced. And I’m not sure it’s going to appraise and you know, it’s gonna cash flow, but only if, like, you know, the property was pretty new. Right? But it’s only going to cash flow if we actually don’t have any repairs. And so it really kept me up at night, worrying about am I making the right decision? So I ended up calling the guy I was like, Listen, you know, I’m having doubts. I don’t like doing things when I’m not 100%. Sure. So I know I gave you a verbal, but I’m not going to submit an offer. And he responded back and said, That’s fine. Like we’ve got 10 properties in the market, if you want to consider these other ones. And so he had sent me the spreadsheet. And I just looked at the numbers and there was two in mind, they were actually in Portage Park that had the highest profit, right based on what the current rents are, what my mortgage would be. Right? And I wasn’t really properly at least figuring in repairs, capex vacancy, all the things that a proper analysis should, and I ended up going on a contract for both properties. So I was gonna buy two at the same time. One didn’t appraise out, it was really difficult trying to do two properties at the same time, because they were both contingent on each other. So we agreed to drop the one close on the other one. And then as soon as that one closed, we were going to go under contract again, with a different lender, and they ended up selling it. In the meantime, which was fine. But I bought in Portage Park before I bought a legal three unit in Portage Park, before the new development was announced. So that property, I just appraised for almost double my money. And I haven’t done anything to it, besides just letting it sit there and do very minor repairs as they’ve come up.

D.J. Paris 13:40
It’s amazing. And so over time, you just started developing a better sense of what kind of investments you think made the most sense, or was it always strictly numbers? Or did you look at certain neighborhoods more favorably?

Brie Schmidt 13:55
So it’s a little bit of both right. And one of the things that I do when I consult with clients when they’re looking to buy is I try to explain to them like it’s a piece of pie, right? And there’s only so much pie to be had. And you can choose which piece of that pie is going to be bigger, right? That’s your choice as the client, and the four pieces are location, price, cash flow and condition. Right? So if you told me like, hey, I want a cash flowing property in Bucktown, and my budget $600, my response is going to be that’s awesome. Find another agent? Sure. I can’t do that for you. Right. So it just it’s a matter of figuring out right? What is best for you. You know, if cash flow is your number one issue, you have to be open about location. Right? If location is going to be your number one issue, you’re going to sacrifice on cash flow. It’s as simple as that. And so it’s about teaching and understanding that there is no there’s no one way about doing this right. Everyone’s got different, different goals right different priorities and Figuring out what works best for that person. So for me, it was cash flow. I knew nothing about Portage Park. I had never even been to Portage Park. I’ve gotten that was luck, right me buying in that area before it started to appreciate. My first property was an Albany Park. That one wasn’t necessarily luck. That’s also an area that’s appreciated drastically since 2011. But that was something that as I started looking at properties and areas, I noticed that there was, you know, by the Kedzie, brown line stop. This was again back in 2011. That new condo conversion building, I believe it was a Conlon building had had been in the middle of being done. So I noticed that there was there was signs of revitalization before the market crashed. And it’s next to two train stops. It’s got North Park University. It’s got Northeastern Illinois University, it’s got River Park. So my thoughts were, hey, when the market bounces back, this area is primed for development, right? It’s got so many local amenities, how could it not be a great market? And that’s what I bought based off of?

D.J. Paris 16:02
That’s amazing. And what point because you’re very prominent in the online community, bigger pockets, and probably other investment communities as well. But when did you when did you start, you know, getting involved in bigger pockets, or at least posting and learning from them.

Brie Schmidt 16:18
It’s a super, it’s a funny story to me, because it’s the I described my life as pre BiggerPockets. And post. Because it was such an integral piece in my my development and where I’ve come. So at that point is that we bought a property in 2011, we bought another one, I think it was like January 3 2012, or December, end of December, then we bought another one in 2013. And that was a property for us to live in. It was an old two flat that was partially converted to a single family. So we completed a D conversion, we did about $150,000 renovation on it. And I was looking to do a cash out refinance. But the property has got quirky zoning. So I was Googling just a very general zoning question. And this website popped up was someone that had asked that same question. And I was like, oh my god, this is a form of investors. And that started the downward spiral into this bubble or world of investing. Because if anyone doesn’t know what BiggerPockets is, it is a social platform for real estate investors. But it’s built on the premise of paying it forward. So it is a community of I think, almost 600,000 investors across the world, who don’t charge for their advice, and whose primary goal is to help out other people and answer their questions for free. Right. So I posted on the site, and I remember like, within the first day, I had 10 experienced investors giving me their opinions about how they would handle it or what their experience was. I was like, Holy crap, like, this is awesome. And I just started getting involved with the community. And you know, people would ask a question, and I knew the answer to that question. So I started responding. And then you know, next thing, you know, was like, I think a month later, I get an email from them. Like, you’ve gotten an award, I’m like, sweet, what’s an award, like, you’ve got the attic award, that means you’ve been logged into the site every single day for 30 days. I’m like, that’s a problem. And, you know, like, it just it just completely consumed my life. Because I had this whole world of people that liked to talk about things that I like to talk about. And it was a whole level of knowledge base way above and beyond with at that time I knew. And I just went when dove right in so said within, within six months, I think I found bigger pockets. It was Thanksgiving weekend. And by Fourth of July that year, I’d quit my corporate job, my six figure salary. And I bought 10 new properties and decided to do this full time. So it was really the learning them helping me the learning curve A be the support system, knowing that if I ever get in a situation where I don’t know the answer, I’ve got hundreds of 1000s of people that will help me out. And that’s kind of how I jumped in and learned.

D.J. Paris 19:06
Yeah, I mean, Bree is so prominent on bigger pockets, at least here in the local Chicago area, because there is ways to sort of narrow even posts down by geographic, like zip codes. And it’s really, it’s got a really nice social component, in addition to just being this amazing form of of information to Bri is very prominent. And I imagine I’m just curious, I don’t I don’t know that this would be the case. But just because over time you’ve established yourself as such a knowledge source. I’m wondering if that’s attracted a lot of investors to reach out to you directly to you know, to do do buys or do purchases or sales.

Brie Schmidt 19:43
That’s that leads into how the brokerage business, right like I’m an investor first, and that’s that was that was an is my primary focus. But that’s exactly how the brokerage business started. Remember this time I was still working corporate. My license had been in With a holding company for about 10 years, so I hadn’t taken on a client in 10 years, I didn’t like clients. Because they were just talking about emotional or, you know, I’m like, not gonna do that again. And so part of how this all came into fruition was you know, I did a podcast with bigger pockets. I started doing podcasts nationally, I started getting invited to, to speak at national conferences. I speak at about eight to 10 events a year, locally and nationally. And I also host on a networking event in the Chicagoland area, I started hosting that in 20 would have been 2014. And I remember being at one of the events, and one of the guys came up to me, it was like, listen, like, you know, you’re an agent, right? I’m like, well, technically, yeah, but I don’t take on clients. I’m just an agent to do my own deals. And he’s like, I cannot find an agent to teach me about investing. Like, they’re all They’re just retail. They know, condos. They know single family houses. But they don’t know, like, what capex is. They don’t know what proper vacancy is, you know, can you help me? And time I was like, Yeah, I’m kind of bored. Like, I guess I could, you know, like, I have nothing really going on. And I’m like, Yeah, I’m sure I could, I didn’t have a car. Right. Like, I couldn’t go do showings. So like, he had to pick me up. And I actually found out I really, really liked it. So it’s been, that was August of 2014, is when I took on my first client. And then just other people started asking me like, Hey, I heard you were working with so and so can you help me too. So at that time, I was still quite involved with my Milwaukee side of the business. So I was only looking at taking on three clients at a time, I was very aware of my time commitment to things as I am today. You know, if you go back to the beginning of all this, I don’t work to work, I work to create a lifestyle for myself, and to travel when I want and to to enjoy my life. That’s my end goal. That is what everything every decision I ever made, or do make is built around. How does that affect my ability to live my life like I want it? So the time for the first two years, I only took on three clients at a time because I did not want to create a workload for myself that I that would, you know, go into my own personal time would handicap you. Sure. Yeah. So it wasn’t until my my investment business got to a point that I could run it without having to physically go to Milwaukee every week, run it to the point where, you know, I’m just I’m, I’m down to maybe 20 hours a month running that business. Once I freed up more time taking away from that business and got that up and running, I was able to free up time to allow for the brokerage business. And that’s when things started to get maybe out of control if some people might consider it. But the from the time I went from what I would consider a part time agent to my first full year, my business almost quadrupled. Year over a year and it got it now is my full time focus is working with clients.

D.J. Paris 23:05
And I imagine all of those clients find you or at least almost all those clients, I’m sure find you instead of you going out and sourcing them is that fair to say?

Brie Schmidt 23:15
I’ve never done any sort of outbound marketing or advertising. So I’ve never done direct mail I’ve never done done Google AdWords or my website isn’t even really a website, it’s more of a blog. And so I’ve never done like SEO or AdWords or any of that stuff. My clients all come from referrals, mainly and do not working. And it’s through, you know, conferences I speak at, or podcast. Also through again, in bigger pockets. For years I’ve been, you know, I’ve been always been in a position of paying it forward. So even just between Friday and this morning, I had six phone calls, with potential new clients who’ve reached out to me again, sometimes they’re they’re not really looking to buy, right sometimes it’s just me giving them information about the market, or helping them walk through what their goals are, and seeing if this market will deliver this sort of the sort of product or investment properties per se, um, to reach their goals and at the end of the day, that might not be what they’re looking for. But I will always take the phone call and do as we call it, onboarding, an onboarding consultation, like hey, you know, this is what this market will will give you this is what you know, it will dictate and so if this isn’t the market for you, that’s okay. I can refer you to another agent or give you advice on other markets that I do know of that will help you reach your goals but it all comes down to what the investors goals are.

D.J. Paris 24:41
And are you as as either an investor yourself or the investors you work with? Are you exclusively at this point looking just in Chicago? Are you also looking back at Milwaukee or even other markets?

Brie Schmidt 24:54
For for me as an investor I stopped purchasing properties in 2015 for myself personal So, I, so I have my I have my license as a managing broker in Illinois, I also have my brokers, which is the equivalent, they do brokers and sales persons in Wisconsin. In Wisconsin, I do not take on clients in Wisconsin and is not worth a three hour round trip drive for, you know, $100,000 properties for me to do it, and it’s much more labor intensive. So I stopped purchasing properties in 2015, when I hit my personal goal, which was $35,000 a month gross rental income. Right? That was the number that well, a my friends husband made me agree to, because it’s, at some point, he’s like, Listen, this is getting out of control, right? When’s Enough Enough, like you have to put a number or attach a number to this. Because if you don’t like I was just I was all in. And he’s like, You got to put a number to it and and hit a point where Enough is enough. And for us, that was $35,000 a month gross rental income that would allow both of us to quit our jobs, right and not have to work unless we wanted to work. Sure. So we hit that goal in May of 2015. And that’s when I also started working with partners. So I have purchased properties since 2015. They are just with strategic partnerships that I have. So I’ve got three partners that buy property with me. I never wanted to be in a position where I was competing with them. So I never wanted them to feel like oh man Brees taking the good stuff and giving us the leftovers. So that was part of the deal was once I was ready, they all two of them waited a year, almost a year and a half to work with me. And I explained why. So that they could be my priority, right? They always I always want them to be my number one priority. So we’ve acquired more properties. Since then, under my joint LLC is my next purchase is probably going to be in Chicago again. I like the balance of the two markets. And one thing that’s why go back to the goals. Right? Chicago, Northside is what I would describe as an A B market. It’s a very balanced market of cash flow and appreciation. Right? It’s going to take you a lot of money, though to invest in Chicago to replace your monthly insure. It’s as simple as that Milwaukee or like Southside Chicago or Northwest Indiana, or what we call cashflow markets. So those markets are very little appreciation potential, but much more on the monthly cash flow potential. So I like the balance of the two, each one provides different goals for me. So Chicago is my my long term wealth building portfolio. Right? I’m not going to get rich on my monthly rental income or my monthly cash flow. But the appreciation that I’ve received in Chicago over the years, I’ve been able to pull out and redeploy that capital into investments, right? So it’s increased my long term wealth. Milwaukee, on the other hand, pays my monthly bills. So that’s what generates the cash flow that is monthly, but when I sell it, right, I’m not going to be profiting very much. But now our portfolio, we’re just just at $59,000 a month gross rental income across all my all my properties.

D.J. Paris 28:07
It’s amazing. And just to recap, you’ve only really been investing in this way for like five years. That’s a pretty incredible achievement.

Brie Schmidt 28:17
It was a really crazy year. So I’m one of those people that when I decide to do something, I just go and do it no matter what the consequences are, that can work out good or bad for me, depending on the situation. I mean, but I went and bought 18 properties in less than 12 months. You know, like it was I think I bought 51 units in less than 12 months. And if I were to do it over again, right, I probably would have done it a little bit slower. It definitely caused it cost me a lot of money in the long run. Because we were going like as soon as we got you know, one set of properties, you know, righted we righted the ship, right, we dealt with tenants moving out was before we even met them, we dealt with unknown problems that we didn’t know we had, you know, once we we got that part of the buildings stabilized. I was buying another one. And then so we went through like a year and a half, almost two years straight of as soon as we would get it like to a good point, we didn’t relax, we just went right into it and did it again. And I didn’t stop to really think about the systems and the processes necessary. Right. I was lucky that I understood the basic foundations of investing from doing this myself in 2011 through 2013. That really, really helped me but I probably I might my guess is I probably have lost $100,000 Over the last six years by by doing it too fast. Is that a learning lesson? I learned of course what I would have done differently, maybe maybe not. But I definitely learned quick so that

D.J. Paris 29:51
and I want to go back and I’m sorry to change topics but I wanted to go back to something you said and you talked about this idea of paying it forward, in particular with information Going around investing and, and bigger pockets is a great community where you can learn from from people who are willing to be generous enough to talk about the things they know. And bigger pockets. It’s like $100 a year, it’s incredibly inexpensive, but I wanted to pay you a compliment. It’s just I don’t know why I hadn’t thought of this till, as you were speaking and mentioned that paying it forward thing you actually did that to me once, not about not with respect to investment information or bigger pockets, but I believe a broker had contacted you about maybe joining your team or I’m not exactly even sure what the context was, but you reached out to us or me or my my boss, Nick, and said, Hey, I have a broker that might be that might be a good fit for your firm. And by the way, I’ve been recruiting Realtors for seven years, we have about 600 brokers here. So I have a lot of experience going out and finding brokers on my own, I can count maybe that has happened one other time in seven years where another managing broker reached out to me and said, I have somebody that would be a good fit. Managing brokers don’t typically do that. Because you know, they would probably want that person to work at their firm. And I don’t even remember who this person was at this point. But I wanted to say like, that is a perfect example of just how generous and thoughtful you are we you and I weren’t friends. So you know, so to speak, that the fact that you even thought to do that was was very kind and generous. So I just wanted to say like, that really speaks to who you are. And you probably don’t you probably remember doing that. But I remember I do. I just

Brie Schmidt 31:27
did it again two weeks ago, I just talked to him on Friday about it, he was about to give notice to his current brokerage and go work. So, I mean, it’s right, this is this is my whole philosophy on life, and what my philosophy on life is, goes through every, every decision that I make, every everything that I do goes towards what I want out of my life. So a I don’t need the money to make someone needs to make their own decisions, right? I can’t make decisions for you. So in that particular case, and the case from the guy from two weeks ago, you know, he called me and said, Listen, like I’m with my brokerage, I’m not sure I’m getting what I think I should be getting. And I suggest that you guys, because he’s a professional flipper, he does new construction development. You know, he’s not an agent that works with retail clients. That’s not what he wants to do. But he’s looking for a place to sell his own deals and work with a very small network of referrals. I think kale is a perfect fit for you, you know, the way that they’re structured, right? It will give you optimal, your optimal commission back to you. And they have enough support system to fulfill exactly what you do. I don’t necessarily need to make money off of you. But it needs to be a decision that works best on your goals. So I said even with people that call me about investing, right, I’ll give anyone an hour on the phone, that’s my rule. And I got, it might not even lead to a monetary benefit for me. But at least I can help you determine what your goals are, and what’s going to be the best fit for you. And then again, it all goes back to what my lifestyle is. I do not want a team of agents. Like I’ve actually had lunch with Nick, I got approached about a year ago from a friend from Ohio, who was looking to start a brokerage company in Chicago and wanted me to work with him on my losing my license. And I actually asked Nick out to lunch and was like, Can you walk me through this? And I left that meeting be like No, no, not gonna happen. Like I, I do not want to I do not want to manage a bunch of agents, right? I do not want to do that. Right? I want to do what I love to do, which is I get to talk to investors all day long. And I get to analyze properties all day long. And I get to help them make decisions that are going to impact the rest of their life and their kids lives. Right. And it’s about the strategy and the goal setting and how are we going to get there? And you know, all that is super fun to me. Managing other agents and being a mommy and having to, you know, deal with, that’s not fun, for sure. So, I like to do what I have fun doing.

D.J. Paris 34:03
Absolutely. I mean, I think you’re you are so incredibly clear about what you want out of this business and also just in life in general, I think you’ve gotten really crystal clear. And then you just like you’ve said your own words you’ve you’re all in. And and I think the giving part of it is so obviously it was so obvious, but to the listeners but also probably a key component of your success. Aside from being very savvy and knowing exactly what you’re doing. I think this idea of giving back I mean, you are synonymous in the Chicago land investment world with information and just knowing more than I think maybe other people you’ve really established yourself without the self promotion. Just literally being a knowledge source has made you an expert without having for you to even say you’re an expert. I mean, you know that you are known and I think that’s really impressive. Because I think a lot of people Fake it until they make it I don’t think you’ve done that at all. I think you made it and then said, oh, you know, when people followed along, I think that’s really impressive.

Brie Schmidt 35:04
It was definitely opposite. I said, That’s why my six year old self, if my, if you asked me six years ago, if I would have my own brokerage company with four agents, you know, and dealing with investors, I would have laughed because back then I like there’s no way to ever be an agent, I don’t like clients. Um, you know, so I was just lucky enough to find a niche, right, which I enjoy. And I get to talk with people and educate them on topics that I enjoy. And I’m obviously very passionate about, regardless if they’re my client or not, or they decide to work with me or not, I’m really big about people making their own decisions. And one of the things that we do these onboarding calls, which are mainly around expectations, right, what are your goals? What do you want to accomplish, and is what we have available to you going to fit into those goals and accomplishments. And one of the things that we talk about a lot is how we sleep at night, you know, and I always tell clients, like, Listen, my job at the end of the day, is not to talk you into buying a property, my job at the end of the day is to teach you enough and educate you enough. So that when a property comes up that you like you are 100% confident in making that decision. Because the worst thing in the world any of us can do, especially with with investment properties is worry or set or self doubt ourselves, right? This is not, this is not 20 bucks, that you’re losing here, this is potentially hundreds of 1000s of dollars. You know, this needs to be something that you go to bed at night, and you sleep like a baby, I sleep like a baby, I do every single night, sometimes with a bottle of wine helps, too. But you because I’m solid and all my choices, you know, of every investment property that I bought, I don’t buy anything that I’m not 100% Sure on. So it’s my job to teach you to get to that level where you feel comfortable making that decision. Right. I don’t want you up worrying at night. Did I overspend? You know, or how are we going to pay for this? Or our type? Our cash flow is super tight? Like what if? What if a refrigerator goes out? Right? How are we going to pay for that? Never want to be in that position as an investor. It’s very scary. And I’ve seen over the years and talk to you plenty of investors who have fallen right and gone from you know, they just they didn’t didn’t focus on the foundations. Right. And they didn’t, they weren’t well capitalized, and they weren’t conservative enough. And then something happens and boom, you can lose it like that. You know, last week I had last week was a really fun week for me. Last week, I had a client lose his job. Six days before closing that was super fun. My turnkey reviews website, which is another website that I run, got a virus. So that’s been down for the last week. And then I had to tenants just up and leave. Like January 1 hit, we got a call from energy company like hey, they turned off gas service because they moved out on my That’s a surprise. You know, so it was a really crazy week for me. But if I’m not well capitalized and prepared, you know that that was two tenants that just vacated they didn’t pay rent, right? They didn’t clean? Um, you know, if I don’t have the money to cover my mortgage that month, what’s going to happen? And that’s one of the preparations you need to make for for being an investor.

D.J. Paris 38:14
Yes. And yeah, I you know, so it’s, it’s funny, do you do all of your own property management? Or do you outsource that?

Brie Schmidt 38:25
I used to, I used to do it all. And that said, when 24 Up until 2014 2015, I did it all myself. I had a I had a manager that had assisted me, but I ran the business, all the accounting, all the decisions. And then he did like the day to day like he handled only the maintenance calls or the lease ups. It wasn’t until it was until 2015 that I decided I had to hire out professional management. And again, it went back to my time commitment. Right, where’s my time best spent? I was going up to Milwaukee, you know, every week. Of course, you know, when anything happened in Chicago with my brokerage. It always happened on days I was in Milwaukee Sure. Of course. Oh, of course. So like, I would end up on the side of the road with my hotspot trying to DocuSign contracts to people, you know, and it was just like, this is out of control. I can’t do both. And I had to decide, you know, where where I wanted to spend my time. And i i The picking up of the investment properties, the analog, the analyzing, right, that’s all fun for me, but the day to day is not fun for me. So I hired that out. So I’ve got two full time managers that manage my Milwaukee portfolio. I’ve got a manager that manages my Airbnb property here in Chicago. And then I self manage my rentals here in Chicago because they’re super easy. And then I just manage all of the managers that got me down to about you know, 510 hours a week tops, and that gave me 20 hours a week to do broke. Sure. So that’s when I made the switch and focused my my What I was doing with my day to day, well, let’s talk

D.J. Paris 40:02
you know, if there are investors that are listening, and we do have investors who listen to the show and they’re interested in, in working with you directly what’s the best way they should reach out to you?

Brie Schmidt 40:13
So my new website, which is hopefully coming up soon, would be second city dash rt.com. That should be up by the end of January. If not, you can always email me at Chicago Bri. Obviously, Chicago and the word Bri b r i e@gmail.com. Or you can find me on bigger pockets or LinkedIn. That’s generally where I spend a lot of my time.

D.J. Paris 40:36
Wonderful. Well, Bree, you I think you’ve said it all. And we’re so I’m so excited to have you on the show. So thank you very much. Is there anything else we need to oh, well, let’s plug in the real estate networking summit one more time to get more information about this three day summit that Bree is putting together herself 300 attendees, many, many speakers, it’s Midwest, ar e summit.com. And, and if you’re not, and if you’re a broker, and you’re not that familiar with investments, get on bigger pockets, start learning, because you you know, you may find that once you develop the skill set of being able to work with investors, you might find like Brita that she that you prefer to do that and just you know, throwing deals their way. Again, you might find you like that better than traditional, you know, retail clients. But Bree, thank you so much for being on the show. We really appreciate it.

Brie Schmidt 41:28
Thanks for having me.

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