Building a Real Estate Empire from Cubicles to Co-Living with CPA Brothers Harrison and Ben Sharp

[0:00] Welcome to the REI Agent, a holistic approach to life through real estate. I’m Matthias, an agent and investor. And I’m Erica, a licensed therapist. Join us as we interview guests that also strive to live bold and fulfilled lives through business and real estate investing. Tune in every week for interviews with real estate agents and investors. Ready to level up? Let’s do it.

[0:24] Welcome back to the REI Agent. Matthias here. I, you know, I’m coming off of a really good weekend. I am, I was telling Erica, I’m feeling like I’m in cloud nine. So I’ve, I’ve had a listing. It’s been a challenge getting this thing to the market. I worked on this for months with a client that was a bit needing just a little extra detail oriented. I think honestly, their wife passed not too long ago. And I think there’s some grieving as part of it. I think there’s a difficulty of letting go. And I’ve definitely feel for them. But it’s been a bit of a process to get the house listed. We, we, we sanded the floors, refinished the floors. Did a lot of touch up paint. Got everything moved out. And a whole bunch of junk out.

[1:18] Various other projects. Got it deep cleaned, et cetera. Then went through the process of staging it. So it’s been a long time of, of work, you know, months of work getting this thing ready. It also happens to be in a market that I’ve been farming for two years now. And in that market, I’ve, you know, been telling everybody that I pay, I help pay for handyman. And stagers to come, you know, get their house show ready, market ready to get top dollar for their house. And we went live on Friday. This is Monday now. And we have four offers. So not an insane amount. But it is, they’ve gone, the price has gone crazy. So we are, you know, I probably, I don’t know how much I should say because it probably won’t be closed by the time this thing airs.

[2:11] But we are doing very well with the price. And it’s just, it’s a really rewarding feeling to kind of have all that work and all that kind of frustration and, you know, just all the coordination kind of leading up to getting it out there. And then the market receiving it really well. And it just happened to be in a market that you’ve been kind of telling everybody, this is what I do. So now I can find all the different ways to market to that, you know, to that farm that, you know, this is what I do and this is what happens when I do it. So it’ll be fun to see, you know, what kind of activity we can drum up from this successful market, marketing experience with, you know, that same farm. On top of that, I ended up having band practice yesterday.

[3:00] And I’ve been not able to sing quite the way I’d like to be able to sing for the past couple of times. We had a bit of a hiatus with Erica’s surgery. And when I had band practice yesterday, I was able to just to hit all the notes, didn’t really slow down. So that felt amazing. I was living on cloud nine and then I came home and made some steaks and it was just a good weekend. And Erica also started walking a little bit without her crutches. And that is just an amazing sight to see. Like she kind of started with one crutch the other day. And then she just, I think it was yesterday too. She just kind of just started trying to walk without it, you know, limping and trying to not put too much weight on it.

[3:48] But this is, I think the doctor’s visit today was the day that she was going to be officially given that, the right to do so. And the PT, people had been telling her that she’s going to need to build that up, that strength, so that she should start moving a little bit on it. So that’s just a really encouraging thing. We are feeling like we’re getting kind of on top of that and just are in a better place overall. So it’s been nice to see all that come together for sure. Today’s guest is a brother team. And they are in the Dallas-Fort Worth area. And they sell a lot of real estate, have a bit of a niche with investors and being investors themselves. And it’s a really good conversation. I think they are also coming from an accountant background.

[4:42] So, you know, we got like a CPA, real estate agent and investor, which is like the trinity, the holy trinity of this show, right? That’s what it’s all about. But they understand, you know, all those elements and how they play together well. And that’s kind of why they’re in the space. That’s kind of why we’re in the space and, you know, trying to communicate, you know, all the benefits of being an investor and an agent. But without further ado, we have Harrison and Ben Sharp.

[5:18] Welcome back to the REI agent. I’m here with Harrison and Ben Sharp. Harrison and Ben, thanks for joining us. Yeah, thanks for having us on. Thanks for having us. All right. So for people who are watching the video feed, can you say who’s who? I am Harrison with the hat and I’m Ben with the hair. Cool. Awesome. Thanks. You all are brothers. Tell us a little bit about what you do and how you’re in the real estate game and how you got started. Yeah. So currently what we’re working on right now is, you know, we’re we’re trying to kind of grow like a I guess a sales business, real estate sales business. That’s primarily what we do right now. I’ll kind of go back a little bit to the beginning. I mean, both of us have a bag.

[6:03] We’re both CPAs, both on the A&M, studied finance and accounting. Kind of went, you know, super quick on this. Just went into corporate, you know, corporate America. Big four, Ernst and Young. We each did that for about five or six years. And then kind of randomly I pivoted into real estate unbeknownst, like didn’t really intend to get into it. My my real goal, like I guess on the sale, like basically getting into it initially was, all right, you know, I figured out about real estate investing through bigger pockets, like a lot of real estate people in the industry kind of do. And I bought a rental and I was like, you know, my goal is to start buying one of these every single year. I might as well just get my license and try and stay on the commission, you know, network with other people, write my own deals, things like that.

[6:51] So that was my intent on getting the license. Just to kind of do that while I was, you know, working, working in corporate. And then, you know, I bought a rental and then I was like, oh, you know, this strategy that I’m doing, which was at that at that time was specifically house hacking. I helped some started helping other people do it. I was like, oh, shit, I can make a lot of money doing this, especially kind of in the industry that we’re in. You know, there are a lot of people that agree, you don’t get good advice, things like that. And, you know, after that first year, I was like, oh, wow, just let’s see what happens. Was kind of concurrently doing it for 11 months at my full time job. I ended up making twice as much in real estate as I was in corporate.

[7:30] And then at that point, just jump all in and have been doing it for the last five years. Okay. And then my brother kind of came in and he got his license as well. Wanted to start doing the same thing I was doing. You know, what he’s been doing recently, we started up at this entity. We’re trying to basically grow our sales volume and sales business. He basically is the COO. He does all the operations back and basically is helping make my life easier. And that’s kind of been the starting point where we got, you know, we jumped into it, I guess, together in around August of last year. Okay. We’re making, trying to streamline everything, make it, you know, basically run it like a company. And that’s kind of how we have it set up right now.

[8:09] Yeah. So. Okay. Yeah. Yeah. I have, I have questions about some of that operation stuff and maybe let’s talk a little bit more about house hacking and the strategy there. I think, I think, you know, if anybody happens to not be aware of what that is, it’s basically is you’re buying something and living in it, buying it with a lower down payment usually. So, you know, you can do an FHA conventional, just lower down than the full 20 or 25%. And then you’re either renting out rooms to other people or you’re renting out like an apartment kind of thing. Did you, which route did you go to? I mean, we around my area don’t have a ton of multifamily that, that can really work well for it. So it’s really like you’re trying to convert a basement or just renting out rooms.

[8:56] So what, how did you all go about that? We actually both did our own house hack, but we started off by doing just the rooms. So basic three, two, I bought a three, two, he bought a four, two. Yeah. And just offset the, you know, basically around the rooms, offset your living expense, easiest and most cost efficient way to kind of get into the real estate investing game. And, and, and obviously for most people, what’s the number one issue is capital. So that’s a great way to get into it. That’s how we kind of got started looking back on it. I wish I probably would have gone a little bit different route. Like you just said, we, in our market, we don’t have a ton of two to four units as well. They’re very, very slim.

[9:34] And a lot of times not the best areas and, you know, very older and things like that. So you can find a good one going that route. But we really, what we really see working in a DFW metro right now are still the rent by the room model. And then there also are a decent amount of properties. Again, not, not, not as many, but, but what I really like, and I own a few of these type of properties as well, where you got a main house and you have an ADU or a guest house. Yeah. Um, basically treating it like a duplex, lease that to two separate sets of people, or you get a higher rent premium if you’re, you know, doing multi-generational living, things like that. Um, and usually the entry point on those is a little bit better and you usually get a little bit better area as well.

[10:10] So those are kind of the two big ones that we, that we help a lot of investors with and what, and kind of what, where I would have gone if, if I, we didn’t do the rent by the room, um, route. Yeah. So on those, um, does, does the zoning have any restrictions as far as, uh, like if you were to move out and, um, you know, there’s just two different separate people living in the different, like, I mean, so for us, we have a lot of restrictions as to how many unrelated people can live together. Um, in, in most of our zoning, it’s like two unrelated people max, um, except for a certain areas. Do you run into that at all? Or is the ADU, uh, zoning a lot more friendly for, for more dense kind of living in general?

[10:50] You’re typically going to be fine on the ADU side of things where you really run into the zoning is going to be on the rent by the room and the unrelated occupants. Um, each city here is, they’re all drastically different. So most of them average is probably around four, but then some cities like Dallas, you’ve got a, you know, there’s some other ones that’ll have five or six. So that’s one of the things that we like to have conversations with our investors with on the front end. Like, Hey, you know, we could push this property up to a seven or eight, you know, bedroom property. If that was the right, you wanted to go and there was space for it, but you know, if there’s parking’s not there, um, you’re in an HOA, there’s going to be an additional layer of risk.

[11:27] So typically it will be like to, you know, for, especially for house hack buyers who are going with a lot of beds, maybe be up against that occupancy limit, the zoning. Um, you know, we want a big corner, nice big corner a lot is one of the things we typically look for and make sure it has ample parking just so the neighbors aren’t, you know, complaining and kind of shutting that down. Cause that’s the biggest risk in that type of investment strategy. Yeah, totally. Yeah. And I think the ones that I’ve, some of the ones I’ve known, um, I don’t think they’ve fully abided by the law, but they were also in an area that, uh, it, you know, it was very common. Like we’re, you know, there’s, we have, we’re in a college town and there, I think there’s a lot of, uh, college housing that kind of has sprawled into different areas where it probably shouldn’t be.

[12:08] But it’s good to know, it’s good to know what the law says and it is good to follow it, of course. But if, if you are going to bend it a little bit, maybe, uh, you know, just at least understand the risk that you’re getting into. And then long-term, if you move out, you know, it’s great. You can find, you know, you rent it to a family or whatever you don’t, you can, you can turn it into conforming, uh, use basically pretty easily. So, yeah, no, that’s a great strategy. I think that’s, uh, definitely that’s like the best, I think, for people getting started in investing, uh, to build up a portfolio. Um, one of the things that I usually tell people to do as well, especially if you see a good amount of appreciation is to go ahead and get a HELOC on that property before you move to the next one.

[12:47] Um, did you guys bounce around to new ones or have you, have you done it multiple times now, the house hack method? So I’m currently house hacking my property. Um, and, and for kind of the newer investors out there, um, and let me know if the video quality kind of goes down for lagging a little bit, but for the newer investors out there, you know, getting into house hacking allows you to jump ship into real estate a lot sooner. Because as long as you can live below your means, like I do, like my base expenses are just, is my food and my insurance and stuff like that. And so, you know, in an industry like real estate where it’s a hundred percent commission, um, and even if it’s not, even if you have a W2 job, like you can invest so much more money by saving all those expenses.

[13:37] And, uh, you know, really taking advantage of that strategy to keep rolling that cash into the new purchase and the new purchase. So Harrison can speak to kind of jumping around and house hacking because he was able to leverage his house hacking into, you know, I did it again. I did it on another one, lived in there and I’m true. That’s a co-living property I’ve got. And then with the savings from that one and you know, the, I did it probably three or four years where I basically wasn’t, didn’t have a housing expense. And then I leveraged that and another rental property that just did normal 20% and just starts snowballing after that. So, um, Yeah, there’s, there’s a strategy of trying to be, be a hundred percent.

[14:15] Like, so a hundred percent of your, um, expenses are covered with cashflow. Um, and what better way to, to get that started if you are, um, house hacking, because you know, that’s one of your biggest expenses is where you live. Um, so if, if you, even if you aren’t at first, that’s a goal, you know, that first property, if you at least have your mortgage covered, that’s huge. Um, you don’t have to pay rent, you don’t have to pay mortgage. Um, that’s huge. Uh, and then maybe the next one you get, if that first one’s positive, the cash flowing, you might be closer to, to getting that goal. So, uh, I mean, it’s a lofty goal. I can’t say that I’ve ever been there or been close to it, but, um, you know, one day we’re, we’re trying to build that up as every, every, uh, every year.

[14:56] Yep. Yep. Tell me more about that, uh, co-living, uh, property. So this is, this is an interesting, uh, nuance. I think that a lot of investors are finding they have to be a little bit more nuanced these days because interest rates are high. Um, and to, to get good cashflow, you almost have to get a little more special, a little more creative, uh, than just doing a longterm rental. So tell me a little bit more about that, what property you got and what kind of co-living it is. Yeah. So we typically just do single family, um, just single family rent by the room, like an ideal property, obviously already has six, seven, eight beds in it. But a lot of times, you know, most of the, the properties here in the price point, um, you’re not going to have that many, um, you know, typically like on a model, if you model something out on it, you know, anywhere from 300 to 350,000, 22 to 2,500 square feet is kind of the sweet spot where you’ve got like a separate dining room.

[15:46] Living space that you’d easily put up a wall. Um, cause that’s the thing, right? Like normal 20% down rentals on DFW, you’re not even going to get near, you’re having to probably put at least 40, 50%, depending on the deal right now, unless it’s a two to four unit. Um, and even those are getting squeezed. So if you want cashflow and an appreciating market, well, where does that lead? Okay. Co-living, let’s have that conversation. Co-living and Airbnb investments are two that I’m seeing right now here that are working. Airbnb has its own, its own sets of risk, but co-living is pretty similar. Um, so we, we have a management company that we partner with. They, they basically partner with pad split.

[16:23] I’m sure you’ve heard of them. If you’re familiar with co-living, they’re the, one of the biggest, they are the biggest operator in the United States. Um, but they basically get the tenants in and we’ve got a manager that’s kind of hands-off, at least to manage my property. You can be as hands-on or hands-off as you want to be, but generally, you know, co-living is a little bit more, requires a little bit more expertise. Um, obviously, you know, if you have an eight bed or a seven bed property, you have seven or eight individual leases with those tenants. So there can be a little bit more friction, um, kind of in that investment space, rather than just having a single family, send it for a debt, a deal with maintenance requests.

[16:54] So, um, those are kind of the, those are the ones that, you know, we help some investors with. We actually have two under contract right now for one of our buyers. He’s got a bond. He’s probably got, I don’t know, 10 or so in Texas at this point. He’s, you know, he’s from LA. He’s wanting to maximize cash flow, get the appreciation bump as well. And this is kind of the market he’s chosen to do that in. So, um, but yeah. Um, is that then the, your primary sales that you all do? Is it targeting investors or are you doing any kind of sales in general? Uh, it’s, it’s actually about 50, 50 retail versus investing on the investment side. We, we do a lot, you know, co we do co-living rent by the room.

[17:31] We help people with traditional two to four units. So land, we saw a lot of land right now. Um, we work with a few flip land flipping entities and we’ll list all their stuff on the back end. Um, you know, they’re, what they’re doing is super cool. They’re targeting anywhere from 10 to a hundred acre parcels, looking into the subdivision rules. How much does it bring to, how much does it cost to bring water, electric utilities out to the parcel? And then if the numbers make sense for them, they’re buying it, chopping them up and selling them individually and making money on it. Um, so we work, and then we also work with flippers. Like we work with, we’re all involved in the investment space. Um, and one of the big reasons that is, is because, you know, real estate is obviously extremely cyclical.

[18:15] You will go through these, um, you know, these periods, like right now it’s, it’s happening on the retail side where your rates have been around 7% for the last three years. It’s very, very, very cost intensive to, to move. You know, if you want to get rid of your 3% rate trade up, it’s very, people are thinking about that decision a lot more right now than they have in the past. Cause it’s so much more expensive and prices haven’t really come down a ton here yet. Um, so it kind of, you know, with, with us being heavily involved in investment space, well, okay. If our retail is a little bit slower this year, well, we have all these investors that we’re continually working with and the numbers make sense for an investor.

[18:49] Yeah, they’ll do it. They’re going to buy, you know, they want to buy and they’re looking for something and the numbers make sense. It’s not even no, regardless of the market cycle, they’re typically going to do it. So that’s one thing that we really, really, really try and tell new agents, like learn the investment game. Cause it just opens up so many doors and there’s, you know, we’ve got other tips and tricks that we can kind of dive into as well. Um, but yeah, we’re, we’re, we’re very involved in the investment space. Yeah, that makes, that makes a sense. And yeah, it’s always, whenever you can, uh, you know, be niched a little bit, you know, even if you, if you’re not a hundred percent in that niche.

[19:22] Um, I mean, that’s just, you, you provide so much more value. Um, and I think there’s so much, um, uh, people don’t understand about investment real estate. A lot of agents don’t understand a lot about investment real estate, the terms, all the tax benefits. Um, yeah. So, I mean, talk to us, talk to me more about those strategies that you’re saying, like what other, what other ways do you, um, kind of leverage that expertise to, to get more business and to serve your clients better? Yeah. Um, I mean, like you said, just kind of knowing all the language and terms and all that is super helpful. Obviously like, you know, we get, we were helping another guy right now. He wants to buy, it’s kind of a secondary investment.

[20:02] He’s runs a business. You know, there’s something that happened in his business where he needs a tax write-off or tax deduction. Okay. What do you do? You go buy real estate and, and you accelerate the depreciation on it. You do a cost-sake study on it and accelerate a lot of that depreciation into year one. So he’s not having to incur a massive tax penalty penalty. That’s where kind of having our CPA and financial background helps as well. Um, so, I mean, that’s one strategy, um, just on the tax side of things. Can you, can you, can you break that down in case people aren’t familiar with, with what you’re talking about? Yeah. So basically anytime you buy, so let’s just say you buy, uh, and I don’t want to go too in depth in the tax code, it’s get a CPA, hire one, talk to one.

[20:43] Cause all this stuff is very complex, but there’s specific exemptions you can qualify for if you’re buying real estate. So, you know, let’s say, let’s say you buy or you build something and it’s an investment, you build a duplex. And, um, typically if you build a residential real estate property, you’re depreciating it over, what is it? 20, I think 27 and a half, something like that years. And if you just do straight line on that, well, you’re getting a little bit of it every single year. Um, but there’s this, I’m not really a loophole. It’s just in the tax code. It’s, you know, if you do what’s called a cost segregation study, you can basically, instead of depreciating that, um, entire house over or duplex over the course of 27 and a half years.

[21:25] If you itemize a lot of it, you get a company to go do this study on it. You can pull forward a lot of those appreciation deductions that way. What you can do is you, you basically are saving that, that money in current year dollars. If you, if you, let’s say you sold like a business or some stock or something like that, you can basically help offset that by purchasing investment real estate. Um, so that’s, you know, that’s, that’s one big piece of it. There’s actually another exemption that we both, or that I, that we both utilize when we buy, when you’re under a certain AGI number, um, it’s material versus, um, material versus, um, or it’s called basically material participation in your rental property.

[22:03] Um, and I’m not, I don’t know what the, what the, uh, where the, um, the numbers are at now. And basically if you’re making under a certain AGI number, you can use the loss on that rental property offset your active income. So, you know, if you’re making 500 grade, you’re not able to qualify for it. But when I was doing, I think it was around like one 25 or if you’re, you’re, you’re aging, not AGI number was around there. You basically get a deduction against your W two, which is massive because typically the tax treatment on investment properties, it’s, it needs to be classified with it with other passive activities. So, um, there’s just a lot of little loopholes that, you know, not being in the investment side, you, you don’t have the, you don’t have access to that basically.

[22:42] So, yeah, no, well, it’s, yeah, like you said earlier, I mean, it’s, it’s, it is just written in the code. It’s not like it’s a, it’s a, technically, but it’s one of those things that, you know, that’s why you hire your, you have your team. You have your team of people that know they’re, that are experts, experts in, in everything. And if you have a really good CPA, they would understand, um, these things that you’re talking about and be able to, you know, and sometimes it’s not even a CPA. Sometimes it’s, it is a CPA, but it’s a tax strategist. Um, and that might even be separate from the person who’s files your taxes. Um, but it’s just good to, I mean, I think if, if you want to look at getting, increasing your pay, take increasing your take-home pay, I mean, looking at how to minimize your taxes is a great way to do that too.

[23:23] Uh, on top of trying to sell more real estate or whatever, but, uh, yeah, like you were talking about, um, that passive income is often where, uh, people get hung up. But, um, yeah, as a real estate professional, typically you can, you can count, uh, you can, you can deduct this off your, you know, sales and everything as well. So it’s a huge advantage being a real estate. And again, talk to your CPAs to make sure I’m not just talking crap here, but we, we do that too. Cause like, again, we’re both CPAs, but like you just mentioned, we’re at the point where we’ve got a big team. Yeah. Um, or we basically like, if someone’s a professional, we’re going to pay them. Like I’m not in that game anymore.

[24:02] Our, what we’re good at is helping people buy and sell real estate. That’s what we’re really good at. And so that’s what we’re hyper focused. It’s kind of like, you know, you don’t want your general practitioner doctor to be doing brain surgery on you. You want someone who’s doing that every day. Yeah. Yeah, no, absolutely. So it’s, it’s just, it’s really valuable to have, like, listen to these kinds of podcasts to, uh, kind of get a general understanding of the right questions to ask. Or if, if your CPA is not, you know, suggesting these things that maybe it’s time to look for, for a new one, but I’m getting some of this experience with real estate for sure will help a lot. And, um, you know, that’s such a huge advantage for people buying like right this year, actually, um, we, the, the spring market has been pretty hot over here, uh, in Virginia for me.

[24:47] And I’m kind of sensing, okay, this is probably gonna be a pretty good sales year for me. I have like weird hot and cold years. Um, you know, I’ve like had a baseline of, of a pretty good sales, um, like, you know, for years now, but every, like every other year it’s like it doubles or, or it’s almost like for some reason. And it’s just like an insane year. Um, I don’t know if I, cause I get burnt out, but anyway, it seems like it’s gonna be a good year, uh, this year for sales. Um, and we are, you know, kind of at that beginning cycle of the year where you’re now you’re, you’re, you’re, you pay taxes, you’ve had all these things happen. And so you’re kind of cash poor and you’re about to build up in the commission split.

[25:26] It’s all that kind of stuff to get back to, uh, you know, feeling like you’re, you’re, you’re in abundance again. Um, and, but there’s a syndication that’s coming up and, um, we had really good, uh, you know, K ones from the syndication, uh, the past two years. And, you know, with it being a possible really good sales year, I’m like, let’s just float this on a, um, HELOC. Let’s float, let’s, let’s invest in this thing in a HELOC. Um, we’ll, we’ll put, we, we just did a cash out refinance on a burr. Um, so we can put some down on it. Uh, but we’ll want to keep a little bit of buffer and then just kind of pay off it, pay it off heavily throughout the year. We have two, you know, dividends coming from two different syndications that we can use to pay it down.

[26:09] Um, but you know, even if it’s just, you know, the, the cash on cash return on it is already going to cover like the interest rate. Uh, so it’s like kind of a break even on that, that end, you know, if everything goes well. Um, but then on top of that, we’re going to get a huge tax benefit from it. Um, and you know, this is something that will keep going on for, for, uh, you know, years to come. So it’s, it’s a thinking about tax strategy is a really, uh, great way of, you know, optimizing your life. And the syndication can be, you know, if you invest in a good one, um, can be really hands off and easy. So, yes. Um, yeah, I want to, let’s talk a little bit about your sales team and kind of how you’re all, you all are setting that up.

[26:56] So you have, um, is it just you two now, or are you going to, are you building a bigger sales team? Yeah. Yeah. So currently our structure right now, um, and it to back up a little bit, uh, Harrison had a really good book of business already. So when I eventually jumped into real estate, it didn’t make sense with the skill sets we have were pretty similar for me to just build one alongside, like just build another one. Right. It made much more sense to come in support on the backend and really turn what is a high paying job into a professional business. And so that was, that was kind of the thinking there. And so where we’re at now is we are, um, we are currently building out a team. Um, and the first step in that is kind of being able to delegate and Harrison and I both really struggle with delegation.

[27:43] Um, and so we were doing everything from, you know, using Excel that using like our phones, you weren’t using a CRM or no professional. Like we were able to, Harrison was able to build his business purely off of brute force. Um, just, just following up with people on the cell phone, providing value, stuff like that. Um, and so where I saw the opportunity was like, Hey, let’s professionalize this. Let’s use a CRM, you know, let’s build a team. Let’s have people doing set tasks. So you’re not burning yourself out working 90 hours a week. Yep. Right. I know that. And then, and then, so, and so that’s, that’s the difficult part is slowly backing away from, you know, I don’t need to do all the contracts myself.

[28:24] I don’t need to put the listing on the MLS. I just need to review and approve, you know, I need to be doing the negotiation, the sales, and slowly even stepping back away from that as we get bigger, you know, eventually have. Like dedicated sales people, dedicated operations people, um, dedicated marketing people. So we can really provide, you know, more value for our clients because right now our business is all referrals word of mouth. We don’t really pay. We don’t pay for leads. We don’t pay for, you know, really anything. And so we can invest, reinvest that money into either, um, back into our clients or into quickening up the sale for people like people’s houses. Like, you know, we can, we can afford to spend, you know, a thousand, $2,000 and marketing someone’s property because we’re not spending that $2,000 to acquire the customer.

[29:14] Right. So, and that’s, that’s really like, the more we think about and look at the industry, what we’re doing specifically like brokering and selling, you know, a lot of it’s done online. Right. So you see these guys like Sir Hans and you know, these people with millions of Instagram followers, you know, that’s, that’s just another tool in their tool belt. So, Hey, why are you versus another agent? You know, we’ve got X amount, you know, just let’s, we’ve got 10,000 people in DFW that follow our page. You’re going to get a hundred, 200, 300,000 more eyeballs on your property. And we, we put it out there. So that’s kind of what we’re focusing on. Cause again, like, like Ben was saying, I’ve been in this for five years.

[29:55] It’s all been word of mouth referrals just from my relationships and grinding. Um, and luckily we, we do a good job for people and that’s why the referrals keep coming in. So, um, but yeah, that’s kind of where our, um, that’s where everybody should start and focus. Yeah. Yes. If you don’t have that part, right. Um, like that’s, that’s, it’s great. I mean, I think like, I do not want to be playing secretary, uh, and answering the phone to like 90% of people, 99% of people that are, don’t even want to talk to me. Um, so I think that’s a awesome place to be in and, and then expanding upon that. Like, I think you’re, you’re talking about, you know, maybe building that, that Instagram or whatever the social media kind of brand.

[30:39] Yeah. Brand. Yeah. And, and then, you know, that beat makes these people that are strangers and may not have like a direct referral to you be more warm, but they know exactly a little bit. And then when they do reach out, it’s not like, it’s like they accidentally clicked on something and now they have 10 agents calling them. Yeah, exactly. And that, and that’s the, and that’s, and it comes back to value proposition too. Like, you know, it, it, it lubricates everything in the wheel. So if you, if we’re going to an investor and it’s like, Hey, you know, just taking Sirhan as an example, he has like 2.5 million followers who just follow him on Instagram. So if you have some random, you know, Joe Schmo agent that has a hundred followers, maybe even a thousand on Facebook, it’s like, which one are you going to pick when you need to get your house in front of as many eyeballs as possible?

[31:25] Right. Right. And so that, and that, that’s kind of our focus. You know, we’re trying to do a lot of things kind of all at once. We’re trying to, you know, D delegate, but we’re also trying to grow our brand because, you know, that’s the, as Zillow grows, you know, that’s the only thing that’s going to be able to differentiate agents is, you know, their personal brand, the value that they bring to a transaction and the expertise that they have. And fortunately, you know, because of Harrison’s background and our backgrounds in, in client service, doing a good job first and foremost, we do a good job. We’re able to get so many repetitions of experience that, you know, maybe an agent who’s only sold eight houses a year.

[32:05] We’ve sold like, let’s, we sell like 80 houses a year. So if something comes up that we’re much more likely to have run into it before and know how to solve it and avoid it before it even comes a problem. Yeah. No, that’s so true. Um, what’s the RM? Did you end up going with? So right now, um, we’re in follow-up boss, um, and we’re going to just try to take that to the utmost limit. Um, there’s a lot of things that I love about it. And, um, first and foremost, it’s simplicity. Um, a lot of, you know, a lot of agents aren’t very tech savvy and I just want to, I wanted to build something that was very intuitive, very easy for them to figure out. It’s very cost effective too, in terms of CRMs for the utility it provides.

[32:49] Yes. And so there’s another, there’s a whole other host of tools that plug into that, but that’s kind of our starting point, um, for now. So, yeah. Okay, cool. Yeah, no, it’s, it is funny how, um, you know, when you first get into real estate, you don’t really consider or, or really understand that you’re kind of needing to become this expert at all these different things. And, um, you kind of have to do a bit of a grind at the beginning to, to get it, uh, past the, the point where you can start hiring. But yeah, like we’re not all cut out to be, you know, marketers, uh, for the, you know, personal brand marketers. Um, you know, we might be good at selling our houses, but yeah, to put our faces on Instagram, it’s not always the easiest thing.

[33:33] Um, and then there’s all the other things and, and you just have to constantly analyze, you know, what is, what is this thing that you do that gives the most value, um, to your clients and is the most important and what can you delegate? And yeah, if, if you get to a point where you’re feeling burnout, uh, I mean, I think it’s time to really seriously consider, uh, doing exactly what you guys are talking about. So that’s awesome. Yeah. And, and, and that’s kind of, you know, what I saw, like Harrison was kind of getting burned out working 90 hours, like a hundred hours, stuff like that. And again, it didn’t make sense for me to just go do more house selling. And so, uh, you know, let, let, let’s push all the clients to Harrison and I will take care of all of the, the, the research, the implementation, the integration.

[34:19] Um, so he can do what he does best and I can do what I do best, you know, um, figuring out where we go from here, hiring, hiring team members, monitoring their performance, stuff like that. Yeah. Yeah. So are you going to be focusing on anything in particular with bringing on new agents? Are you going to be looking at, are you going to divide up things like buyer agents, seller agents, or are you going to look at getting transaction coordinator? Like what’s kind of the next steps for you all? Yeah. So right now we’ve, we, I hired like a full-time buyer’s agent last year. Um, he shows all of our property. Again, that takes up a lot. It helps take free up a lot of my time. We pay him a percentage of each of the deals and we also have him on salary as well.

[35:01] And he’ll do some other miscellaneous stuff for us. Um, and then we also hired a full-time. VA, she helps with a lot of our social media marketing stuff. And then the transaction side of you. Yeah. Yeah. And so, and so right now we do, you know, we have a lot of contractors. They’re not really full. They’re all 10 99s. Um, eventually we’ll start taking it at house and have very specific roles for each people. Um, you know, we’ll have listing. And this changes, you know, as we learn more, as we implement more, figuring out the best practice. But, you know, ideally we’re going to have people showing houses full-time, uh, people doing listing negotiations full-time selling full-time. And, and that also comes back to the value proposition.

[35:41] It’s like, Oh, it, you don’t get one agent to do everything for you. You get an entire team of three, four, five people doing their, what they’re best at, what they do all day. Um, and it really ups the value proposition when you’re talking to, uh, you know, a new client or a new potential client. Yeah. Yeah, totally. I agree with that completely. Um, when you’re, when you’re hiring, when you’re looking for these people, are you, uh, factoring in any kind of personality assessments, uh, strength-based assessments, anything like that? Not right now. Um, we will for sure in the future, um, just because we’re kind of in the beginning, you know, we’re in the beginning stages of it. Um, we just got our TC implemented a couple months ago and you know, we have currently 27 deals under contract and escrow right now and another like 20 on the market.

[36:33] And so there’s a lot of kind of kinks to work out, you know? Um, and so it really limits the speed about how fast we can go. But, um, you know, thankfully like me and Harrison have pretty much the same skillset. I can handle all the accounting, all the backend, all that stuff, you know, and we just need him to focus on selling. So, um, you know, when I’m, when I am looking to hire someone, I am looking to hire the best of the best, but also, you know, you need to get good value on your ROI that you’re spending on hiring this person. Like if we hire a TC, can we double the amount of volume that we can handle, you know, because they’re doing all the contracts, stuff like that. And so, um, first and foremost, I think what I’ve learned from Alex from Ozie, I’m not sure if you’re familiar with him, you know, ultimately you’re building a team to build the business.

[37:22] Um, and so I’m still learning, you know, how building that team, but keenly aware of, you know, personality is, is a big factor in there. So, yeah. Yeah. Well, and it’s also not everything. Like, so we, um, we had, uh, uh, Rosie Noel on the show. Um, she has worked with a lot of investors like, uh, Pace Morby, um, and Vina Jetty, um, and their kind of team building stuff. Um, and she does like Clifton strengths, um, assessments, uh, like for the whole team. And then she kind of, uh, talks about how they work together and kind of their communication styles or different strengths, et cetera. Um, so we thought it was fun. And it was an, an idea that we had was to, to basically get, um, my wife and I to take it separately and not look at each other’s results and then go over it live on the podcast with Rosie.

[38:15] It was a lot of fun. Um, and it was really cool. I mean, it was like giving you language of what we knew, you know, we’re being married forever. So like we knew each other, but, um, it kind of gave us language to kind of, um, you know, talk about those things, like the, the things that they’re good at, the things that I’m good at the way sometimes our communication doesn’t quite go smoothly because the way we see things a little bit differently. But, um, we, we then, then, you know, on the team that I’m building, um, I’ve, I had everybody do the same test. Um, and now we have this like report that kind of goes over all the different strengths. Um, and then I’ve used that plus like kind of an overview.

[38:51] There’s like a, a PDF booklet about explaining all the different strengths that Clifton provides. Uh, just throw that all into chat GPT. And then you can kind of, um, discuss like, you know, strategies for implementation. Like, you know, is this person going to be great in this role? That kind of thing. And it just kind of helps, uh, think through that a little bit. And I, I would, don’t know if I would say I would do that, um, you know, on the hire, you know, I wouldn’t necessarily make them go through that test and pay for it, et cetera. But, uh, these, these people I I’ve known, and I think they’re going to be an amazing agents. And so, um, you know, I was on board for them being on the team in general, and then just kind of then nuancing how they’d help the business as a whole, the team as a whole, and what kind of roles it’d play was, was kind of the purpose for it.

[39:36] But yeah, it was fun. It was a, a fun podcast to get, uh, I don’t know, like analyze live with your wife. Um, anyway, if I have to ask if you guys have any, um, golden nuggets you’d want to share for anybody out there that could be, you know, new agents, it could be agents that are looking to also get into investing in general. Um, anything that comes to mind that you all would want to share? Uh, yeah. One of the biggest things is like connecting with whole is like good wholesalers and wholesaling entities. Um, like, you know, here’s a super easy way to go get leads. Well, okay. Well, what are wholesalers doing? There’s a lot of times they’re spending money on, uh, trying to find a source of deal at, you know, 60, 70 cents on the dollar.

[40:27] Um, so they’re typically spending a lot of outbound marketing money to, in order to do that. A lot of times what happens when they’re spending that money? Well, they might get someone who wants to sell, but is only going to give them 90 cents on the dollar that obviously deal wouldn’t work for the wholesaler. So develop those related, if you have a relationship with that wholesaler, Hey, you know, if you guys get any type of leads like this, send them our way. Um, and you know, in turn, we can help you do whatever, you know, if they’re trying to unload a property, get a buyer, we can send it out to our investor network, things like that. So we get a lot of leads from wholesalers that way. Um, that is, that is probably, you know, one of the big, and if you know, all the, if you know, the investment terms and all that stuff, like it just kind of goes hand in hand.

[41:11] Cause again, like we can tell that and share that secret. Right. But most agents don’t even like you were saying earlier, don’t even want to, or know how to get into the investment space. So like, you know, that’s, that’s one big thing that we do. Um, but yeah. And wholesaling, I would say like, um, I personally don’t, would never do it, like be a wholesaler and an agent. Um, but I bought, um, deals from wholesalers. Um, and you know, it’s, it’s one of those things that I think you can, uh, I, I’m not gonna get into the weeds as to why and what, uh, why that is, but right now, but I think it is, it, it can be a really good resource. I got a, I got a referral from one, um, here recently, uh, for a listing that, you know, I guess they were wanting what a cash offer price would be.

[42:01] Um, I guess it didn’t work out for the wholesaler to, to give them that, that amount. And then when I went there, he also asked me what my cash offer price would be. And I was like, well, I guess I’ll throw mine out too. Why not? And, um, that didn’t work either. So, um, yeah. So then I, we know we talked about what it would look like the list, et cetera. And, um, so yeah, it’s, it’s a really good tip. Thank you for that. Um, books wise, do you have any favorite books that you think are fundamental for everybody to read or maybe ones that you’re just enjoying now? Um, one big one that I always come back to, it’s called set for life by Scott and Trent. He’s a bigger pockets guy. Um, it’s more in the financial, you know, financial freedom fire type, but he basically is like, you know, here’s step one, um, you know, get your expenses under where you’re saving X amount of money.

[42:55] Step two is, you know, hit this certain number of savings. And once you’re here and you’re comfortable and, you know, all right, now you can go take risks and go for, go, go into something that’s gonna, um, generate you more income and revenue because you can only cut expenses up to a certain point, but obviously growing income is unlimited. So just kind of reshaping my mindset. Cause I’m always been like, save, save, save, save, save, and you’ll get there, but no, you gotta like go make, you gotta go earn too. Um, so just very detailed, like, you know, here’s, here’s different ways. He’s, he, he, he’s, he’s also a real estate investor. So it kind of mixes in a little bit, but it’s, it’s a good book that I typically come back to.

[43:34] So I’ll check that out. I, you know, I, I always think it’s a little funny that, um, you know, I’m pitching, getting into real estate investing, uh, to agents to kind of help balance things out, to try to help build up passive income, to try to have like another source of income, to have, build equity, to build wealth, all this stuff. But at the same time, I’m off often feeling, or a lot of the investors I talk to are often very cash poor because it’s a, it’s a bit of a balance there, but I mean, obviously totally worth it long-term. Um, and, and it’s because you continue to invest that you’re cash poor, uh, cause you’re, you’re throwing everything into the next deal and wait until you either sell it or, you know, have a cash out refinance or whatever.

[44:18] But it’s one of those catch 22s, I guess. Yeah. Yeah. Um, cool. What about like, where can people follow you if they want more information about you? Um, you mentioned Instagram. Yeah. So we have a, you know, a company Instagram, uh, SBR.group. Um, and then Harrison and I have our own separate Instagrams. I don’t really post that much to be honest, cause I’m doing the company Instagram and all that stuff, but you can follow Harrison and his Instagram too. Yeah. Mine’s Harrison.sharp.realestate. So he just searched Harrison sharp. I should pop up, but yeah, if you have any. Oh, so we do a lot of podcasts. So any agents, you know, you have any questions, reach out, shoot us a DM, shoot me a DM.

[44:59] Um, you know, we love to help out. And that’s kind of what our MO is just trying to get back to people. Our handle on Instagram is also the same as our website too. So SBR.group. Cool. Well, guys, thanks so much. Uh, this has been a great conversation. Yeah. Thanks so much for having us on. It was fun. Yeah. Thanks for having us. Thanks for listening to the REI agent. If you enjoyed this episode, hit subscribe to catch new shows every week. Visit REI agent.com for more content until next time. Keep building the life you want. All content in the show is not investment advice or mental health therapy. It is intended for entertainment purposes only.