Building dreams on a foundation of love and houses RENOVATION ROCKSTAR The secret language of entity planning BUSINESS FUNDAMENTALS
Expanding REI opportunities with crowdfunding STRATEGY
GET IT DONE WITH DIY EXPERT TAMARA DAY PAGE 14 Fab and Fearless
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INSIDE THIS ISSUE
Photo courtesy of DIY Network
THINK REALTY 8 News & Events
40 Reliable ROI with Mobile Home Investing These small-sized homes can turn large profits for investors. Sponsored content by Chimene Van Gundy, Mobile Home Millions 41 Turn to Turnkey Real Estate Why turnkey real estate is a great passive income investment option for beginners. Sponsored content by Marco Santarelli, Norada Real Estate Investments 44 Tips for Effective Communication Campaigns for Probate Businesses Sponsored content by Kristine Gentry, U.S. Probate Leads STRATEGY 46 Make Time to Meet How Meetups can increase your COI — and your ROI. by Nathan Brooks 51 Creative Investing Requires Creative Funding Sponsored content by Ben Fertig, Constructive Loans 52 Will Opportunity Zones Boost America’s Distressed Neighborhoods? by ATTOM Data Solutions 60 Cryptocurrency and Real Estate An overview of digital assets and how this “new money” might work for you. by Steve Streetman 64 Unlock Additional Wealth 3 ways to make managing a vacation rental feel like a holiday. by Sean Miller 66 Become the Bank TM Sponsored content by Ray Urrutia, Pull the Trigger Enterprises 67 Sponsored Content: Investor Review Lending Edition DESIGN POINT 85 Renovation Rockstar The Van Der Veen family built their dreams on a foundation of love — and houses. by Kelli White 90 Design Guide: Modern Farmhouse Kitchen featured designer: Lorraine Beato MARKET & TRENDS 92 Local Market Monitor by Ingo Winzer
Updates from around the industry. 10 Think Realty Benefits: ApplyConnect Evictions ― when passive income becomes an active pursuit of dues. by Becky Bower
11 Top of Mind
Why saving for the future with real estate is a no-brainer. by Kevin Ortner
INVESTOR STORIES 12 Rebuilding Rural America Veterans buying real estate boosts America one house at a time. by Jeff Edwards 22 Healthy Passive Income
Why passive income matters for everyone. by Vanessa Engineer, M.D.
BUSINESS FUNDAMENTALS 26 Generational Tenants Appealing to today’s largest rental markets is key for rental property owners. Sponsored content by Lukas Krause, Real Property Management 29 9 Steps to a Deed-in-Lieu-of Foreclosure The right and wrong way to handle a deed-in-lieu. by Bruce Kellogg 32 A Legal View 34 Doing Well By Doing Good What property managers should know about video and audio surveillance. Sponsored content provided by Danielle Rogers, National Association of Residential Property Managers ® (NARPM) 36 The Secret Language of Entity Planning Decoding real estate entity lingo provides clarity beyond a balance sheet. by Clint Coons 39 Hard Money: The Problem-Solver Loan Sponsored content provided by Blake Yarborough, Investor Lending Tips from an attorney to protect yourself and your investment. by Michael Johnston
Get it done with DIY expert TAMARA DAY .
by Bobby Burch :: photos by Gary Rohman and Nate Sheets
EXPANDING REI OPPORTUNITIES
BE OPEN TO DETOURS IN YOUR PATH Living with possibility & enjoying the moment.
DEVELOPING A NICHE
A DIFFERENT KIND OF SMOKE DAMAGE
The evolution of real estate crowdfunding.
With so many avenues in REI, which is right for you?
Why vaping may reduce home values.
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PUBLISHER & CEO Eddie Wilson
FROM THE EDI TOR- IN-CHI EF
EDITOR-IN-CHIEF Kelli White
SALES MANAGER Rodney Halford RHalford@ThinkRealty.com 816-398-4111 x86122
Creating Your (Real Estate) Reality
FULFILLMENT COORDINATOR Blair Pierce
ART DIRECTOR Emily Bowers
explains a unique take on entity planning, and learn about cre- ative investment strategies like crowdfunding, cryptocurrency, turnkeys, and more! The real estate investment space is full of creative approach- es to wealth building, and the Think
t’s been said that a change of scenery is good for the
CONTRIBUTING WRITERS Becky Bower Nathan Brooks Bobby Burch Jennifer Jo Cobb Clint Coons Jeff Edwards
soul. I love to travel (I’m a sucker for a quaint beach town), but I’m also fond of family traditions, returning to the same spot year after year. For the past two decades, I’ve traveled to the same beach in
Charles Einsmann Vanessa Engineer Jake Fingert Greg Geilman Sam Jacknin Bruce Kellogg Nate Loewentheil Sean Miller Kevin Ortner Danielle Rogers Steve Streetman Ingo Winzer
Realty team has been creating new educational resources like podcasts and up- coming webinars to inspire you on your REI journey. Whether your approach to finding your next investment opportunity is by riding bikes on family vacation to scope out properties, or just driving through your own neighborhood, looking at real estate from a fresh perspective can help create the reality you’ve always imagined. As I write this letter to you from a vacation rental overlooking the Atlantic, I can’t help but be rejuvenated and inspired to some- day sit in my very own piece of real estate paradise. Maybe it’s the salt air. Maybe it’s the crashing waves. Or maybe it’s just a new view. Whatever fills your cup, do it often. Go somewhere that brings you joy. Get creative, gain perspective, and you’ll soon envision your real estate reality. •
North Carolina for an annual family vaca- tion, a tradition that I gratefully married into. And although this is the same house and the same beach, it’s a change in perspective from my home office in the landlocked Mid- west. Each year, I spot a beach house I feel like I’ve never seen before, and each year as I explore, I find myself researching invest- ment opportunities—searching for my own piece of paradise. A new view can reset our creativity, can reignite our passion, and can renew our quest for growth. The theme of this issue is creative investing, and what better way to showcase that than with DIY expert Tamara Day from HGTV’s "Bargain Mansions". Read about her creative approach to transform- ing the past into the profitable present in this month’s cover story. Also in this issue, Think Realty resident expert Clint Coons
HEY! LET’S BE FRIENDS! GET SOCIAL. STAY CONNECTED.
Like, Follow & Share for the Latest Real Estate News, Trends and Insights from Think Realty
COVER PHOTOGRAPHY Gary Rohman
Are you following Think Realty on social media? Things move pretty fast in real estate. Don’t miss out on the latest trends, tips, insights and news from your trusted resource for all things real estate investing! Follow. Like. Love. Share. Comment. You can do it all with Think Realty’s social media channels. Join the conversations in Think Realty social communities and connect with like-minded members who range from first-time to seasoned investors. Check out all of our social media channels and connect with us - and other investors - today!
FOR ARTICLE REPRINTS :: Contact Jeremy Ellis at Reprint Pros, 949-702-5390. www.reprintpros.com. SUBSCRIPTIONS :: The annual subscription for Think Realty Magazine is $36.00 in the U.S. Order online at www.ThinkRealty.com or call 816-398-4085. Provide your full name, address and telephone number. DISCLAIMER :: Think Realty Magazine , its owners, contractors, distributors and their respective representatives do not provide tax, accounting, investment or legal advice and make no guarantee as to the effectiveness or success of any investment or tax strategies discussed herein. Please consult your own independent adviser as to any questions you have or decision you are contemplating. ABOUT THIS MAGAZINE :: ThinkRealtyMagazine isapublicationof AffinityRealEstateMediaLLC.Reproductionoruseofanyeditorial orgraphic,withoutpermission, isprohibited.Wearenotresponsible for thecontentofanypaidadvertisements.Forreprintrights; toob- tainadetailedstatementofourprivacypolicy;and forallsingle-copy requests,addresschangesandothersubscription inquiries:
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Think Realty's Core Focus is to be the trusted source in the Real Estate Investment Industry by providing products and services focused on serving the Real Estate Investor.
NEWS & EVENTS
Keeping You in A Real Estate of Mind
f you consider yourself a real estate entrepreneur, this event is for you. Learn about tools, tips and resources, and how to manage your real estate business. Meanwhile, you will also connect with pros, exhibitors, and edu- cators that will help you earn more return on your real estate investments. Space is limited and we expect to sell out! On Saturday, there will be more than 40 exhibitors who can provide you with various tools and services strictly focused on helping you achieve the most you can as a real estate entrepreneur. Saturday will also feature presen- tations from keynote speakers, educational sessions including a local market panel, and lunch. Sunday we give prominence to the Think Realty Resident Experts, who will deliver educational sessions on topics such as Wealth Building, Establishing Your Business and Brand, Residential Investing, Risk Management, and Com- mercial Investing. There will also be educational workshops hosted by valued partners. Think Realty Conference and Expo Returns to Irvine and Atlanta I
The Think Realty team has been busy bringing real estate investors more opportunities for education and insight into the industry. Here are a few of the exciting changes:
Look, Listen and Learn! Now you can add Think Realty Podcasts to your playlist options. Whether you watch the video or listen to the audio, our podcasts deliver even more of the hard-hitting real es- tate investment insights you expect from Think Realty. Our phenomenal host and resident expert, Abhi Golhar, is one of the most dynamic personalities in the industry.
Visit ThinkRealty.com/Podcast to learn more!
ATLANTA SEP 21-22 Intercontinental Buckhead Atlanta
JULY 13-14 Marriott Irvine Spectrum
A New Think Group Think Realty and AAPL are excited to announce the new Presidents’ Circle! Perks for Presidents’ Circle members include one-day events packed with expert strategy sessions; widespread exposure opportunities; VIP attendance at AAPL and Think Realty events; discounts; and much more!
Keynote & Featured Speakers: Bruce Norris
Jasmine Willois The Note Assistance Program
Brent Kesler The Money Multiplier Keynote Speaker
Brent Kesler The Money Multiplier Keynote Speaker
The Norris Group Keynote Speaker
Visit PresidentCircle.com for more information.
Emmanuel Guarino Residential Assisted Living Academy Featured Speaker
Shawn Woedl National Real Estate Insurance Group
Emmanuel Guarino Residential Assisted Living Academy Featured Speaker
NewWebinars Coming Soon! Now you can Inspire, Engage and Educate the Think Realty audience with your very own webinar. You own the room while speaking on your expertise in the RE Investing space. This is a great opportunity to speak directly to partic- ipants and build your brand awareness! Our first webinar will feature Marco Santarelli with Norada Real Estate Investments. It’s another way Think Realty is here to help you get even more motivated on your REI journey!
• Chris Evans, Homevestors • Kaaren Hall, OCREIA and uDirect IRA Services • Jon Lee, Outback REIA • Scott Mednick, OCRE Forum • Aaron Norris, The Norris Group • Shawn Tiberio, ShawnTiberio.com and Top Results Coaching Local Market Panel: • Carrie Cook, Ignite Funding • Ben Donel, Esq, Sunset Equity • Dane Fitch, Lending Home • Melissa Martorella, Geraci Law Firm (Moderator) Private Lending Panel:
Amy Ransdell Southeastern Home Team Featured Speaker
Think Realty’s Supplier Program Looking to save money on your next REI deal? Let Think Realty help you make more from your investments with one of the most-valued benefits for our members: The Think Realty Supplier Program. Suppliers provide Think Realty Members a discount or benefit that they would typically not be able to receive on their own. Only those who actually join Think Realty, including the FREE level of membership, are eligible to participate in the program. Think savings? Think Realty!
Think Realty Resident Experts:
To learn more about our events and to buy tickets, go to ThinkRealty.com/Events.
Read more about this month’s featured supplier, ApplyConnect, on page 10.
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SAVING FOR FUTURE
The Cost of Evictions WHAT TO DO WHEN YOUR SOURCE OF PASSIVE INCOME BECOMES AN ACTIVE PURSUIT OF DUES.
by Becky Bower
nfortunately, evictions are a costly risk when owning or
price of the storage unit for aban- doned possessions from the deposit. Beyond the deposit, you can take your prior renters to small claims court to pursue the owed rent money. Quick Tip: Some courts allow you to combine an eviction and small claims lawsuit! You can also garnish their wages or tax refund, although these pro- cesses require taking your tenant to court. To garnish your prior renter’s wages for back rent, you’ll need to sue your tenant, win a judgment and then get a court order to recover the payment directly from your tenant’s earnings. Federal law limits wage garnishment to no more than 25% of the tenant’s net pay (and if the tenant has other garnishments, you’ll have to wait to get paid), and state law can place stricter limits. In some cases, you might be able to get a wage gar- nishment order through the eviction alone rather than going to small claims court. However, if your tenant
time and is typically awarded on first-come-first-serve basis. The benefit to this method is if you suc- cessfully snag a tax garnish then the wages are automatically collected from their refund. Finally, you can hire a private debt collector. We recommend Rent Recovery Solutions, as they charge a flat fee (no commission) to send collection letters and calls on your behalf and report the collected debt to the credit bureaus: Experian, Equifax, and TransUnion. While it’s difficult to gauge what the true cost of an eviction is as the amount of time spent on an eviction varies and the price of legal fees differs from state to state, some analyses have shown the cost to ex- ceed $10,000 per case! As you work through a troublesome tenancy, take deep breaths and remind your- self that you’ll get through this. • Becky Bower is a marketer and writer specializing in multifamily legislative trends. As the Content Strategist at the ApplyConnect blog, she authors in- depth guides on how to manage, grow, and scale within the rental housing industry. ApplyConnect is a Think Realty supplier offering consumer-initiated tenant screening to landlords and turnkey operators. Learn more about the benefits available from ApplyConnect to Think Realty members at ThinkRealty.com/ Supplier-Discounts.
managing a rental property. While some tenants vacate after a simple eviction notice, others require local courts and the aid of the Sheriff’s Department. If the court sides in your fa- vor, then your tenant will have a set amount of time to vacate the premises. This time frame depends on your local laws, and in some cases when the eviction was filed. If your tenant doesn’t leave within the allotted time frame, you’ll need to contact the Sheriff’s Department (and potentially pay a fee) to escort them off the property. COLLECTINGWHAT IS DUE There are a few options you can do to try to collect past due rent or fees from your evicted tenant. First, some states allow you to deduct past due rent, property cleaning fees, and the
Top of Mind
WHY SAVING FOR THE FUTURE WITH REAL ESTATE IS A NO-BRAINER.
by Kevin Ortner
id you know that one-third of Americans have no retirement
benefit from the proceeds of the entire investment, allowing you to grow your money more quickly than you’d be able to on your own. NO. 3 YOU GET TO REMAIN IN CONTROL. Perhaps best of all, when you invest in real estate for your future, YOU are in control. With stocks and shares, you’re at the mercy of the stock market. With real estate, you’re in the driver’s seat, and there is a lot you can do to increase your investment’s profitability. How will YOU save for your fu- ture? •
and here are three reasons why it’s easier than ever before to save for the future with real estate.
savings? While planning for the fu- ture should be top of mind, the truth is, many of us aren’t doing so well. But there’s still hope, and while putting money in a savings account for your retirement years may be what your parents did before you, investing is a far more efficient way to start saving. The best part? You can start today by putting your hard-earned cash into something tangible that will be worth even more down the road. Sure, you could invest in the stock market or bonds, but there is a reason why real estate is the number-one investment choice for so many. Real estate not only allows you to benefit immediately in terms of cash flow but also in the future as well, as your property will appreci- ate, and your equity will grow as you pay down the mortgage. Investing in real estate can be an actual ticket to financial freedom
NO. 1 YOU DON’T NEED A LOT OF MONEY UP FRONT. When you own a rental proper- ty, you don’t always need a large portion of money up front. If you’re a first-time homeowner, you can ben- efit from an FHA loan, which means you may be eligible for a low-inter- est rate and able to make a down payment of 3.5 percent as well. NO. 2 YOU CAN BENEFIT FROM LEVERAGE. With real estate, you can use leverage to grow your money and get a sizable asset using relatively little of your own money. You put in the down payment while the bank puts in the rest. Good luck getting a bank to do the same for Uber stocks. Despite only putting in a per- centage of your cash, you will still
was a government employee or was on a government paid program (unemploy- ment and welfare), you’ll be unable to garnish their wages. Some states allow you to garnish the tenant’s taxes, but keep in mind that this is typically only available within a certain amount of
Kevin Ortner is the President and CEO of Renters Warehouse, America's leading real estate investment services com- pany, and the author of Rent Estate™
Revolution. With the Renters Warehouse Investor Marketplace, renters can find quality homes to lease, and investors can plan, research, buy, track and sell their real estate investments all in one place. Learn more at www.renterswarehouse.com.
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VETERANS BUY AMERICA
corporate America while pursuing his MBA. Yet, he never lost sight of the potential real estate offered. He purchased another home in Texas and began to consume every piece of education on real estate that he could get his hands on. By mid-2018, he started issuing private money loans with the assistance of a long- time friend in the real estate market. In 2019, he purchased three rental properties in rural Texas and two
Grothe. While Grothe is a fairly new investor, he shares the same pas- sions for restoring rural America and providing affordable housing as Andy does. Between the two of them, they stand to make a sizable impact on the American communities that need them most. The model has been proven time and time again, and Grothe is the latest example. When veterans buy America, com- munities thrive. Those who fought
of Missouri had for him. He dabbled with a semester of community col- lege, but quickly realized the costs of college could mount quickly for him. His family didn’t have the resources to support that pursuit and the no- tion of loading himself with unbear- able debt didn’t sound appealing. That’s when he turned to the United States Air Force and a path leading out of rural America. The Air Force seemed like a nat- ural fit to Grothe as he was always a member of teams growing up, playing any sport he could find. After basic training and tech school, this would eventually take him to the 57th Aircraft Maintenance Squadron in Las Vegas where he would serve as an aircraft mechanic. He would go on to subsequently serve in South Korea, Kuwait and two deployments to Afghanistan. It was when he returned from Korea that he would fall into real estate by happenstance. Utilizing his VA loan, Grothe bought a house near Las Vegas, which at the time, was nearing the low point of market crashes. What happened next would propel him to a blooming career in real estate that seems to have no end in sight. In 2014, Benjamin made the decision to exit the military and transition to the Air Force Reserves in Texas. Unfortu- nately, he couldn’t take his house with him, so he sought to sell. That’s when he realized he had made more than $50,000 in two years on the valuation of his house. The market was recover- ing, and he discovered enthusiastically that there was money to be made in real estate. However, he still had bills to pay and a pregnant wife to support so he still needed a job. Grothe would hold various jobs in THE BEGINNINGS OF A NEWCAREER
This content is brought to you by Recon Realty and AndyWilliams
Rebuilding Rural America VETERANS BUYING REAL ESTATE BOOSTS AMERICA ONE HOUSE AT A TIME.
Grothe (center) with Andy and Ashley Williams.
by Jeff Edwards
more a month later. That’s when he met Andy Williams.
to defend this land, for a variety of reasons, seem most apt to steward it well. As communities regain strength and affordable housing returns to rural America, one can be certain that they will find veterans leading the way. •
drain more present than the rural real estate market. Fortunately for rural America, veterans who fought to defend rural America are now returning to own a piece of it. When Air Force veteran Benjamin Grothe left for boot camp from the rural suburbs of St. Louis, he had about $5 to his name. More than 11 years later, Grothe owns more than $600,000 of real estate in rural America, and he is just getting start- ed. In 2019, he met fellow veteran
rom sea to shining sea, rural America has taken its hits
and real estate thought leader Andy Williams of Recon Realty. Between the two of them, the future for rural America has never looked brighter as they are rebuilding it one afford- able house at a time. A FORTUNATE FORAY INTO REAL ESTATE When Benjamin Grothe graduated high school in 2007, he didn’t quite know what life beyond the suburbs
over the past century. Often, when economic times are hard, citizens will move to cities looking for work and higher wages. Moreover, the lure of new adventures is often enough to take the best and the brightest from rural America as they seek new experiences. However, for the com- munities left behind this can result in a drain of talent, capital, and innova- tion. Nowhere are the effects of this
VETERANS BUYAMERICA TO RESTORE AMERICA Andy had been showing first-hand the power and potential of trans- forming rural America one affordable house at a time. Andy’s Veteran’s Buy America initiative has always been on the lookout for fellow veterans mak- ing waves in the real estate industry and he found just that with Benjamin
Jeff Edwards is a Marine veteran and contributing writer for Veterans Buy America. Find out more about the initiative and stories of transition at
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Get It Done with DIY Expert Tamara Day FEARLESS Fab and
BY BOBBY BURCH PHOTOS BY GARY ROHMAN & NATE SHEETS
HAVING A MINDSET OF ANYTHING'S POSSIBLE AND NOT BEING AFRAID OF MESSING UP IS REALLY IMPORTANT.”
TAMARADAY HGTV'S "BARGAIN MANSIONS"
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Photo courtesy of DIY Network
Tamara Day’s Strategic Renovation Advice
As seasoned investors well know, each renovation presents new challenges that, if miscalculated, can bust budgets and tank an opportunity. With more than 30 home rehabs under her belt, Bargain Mansions host Tamara Day has plenty of tools to keep a project on track and under budget. Think Realty sat down with Day do discuss her strategic advice for flippers hoping to avoid headaches while increasing returns.
Study up, build a strict budget All too often, Day has seen flippers get caught up in the excitement of renovating a home. Thrilled by the adventure of revamping a space, investors can skip important planning or poorly research a budget, setting the project up for delays, added costs, or worse. “I think that in home renovations it's easy to get caught up and overspend,” Day said. “I've bought houses from people where they've started the renovation and they just get in over their heads and then they walk away. Do your research and get as much education as you possibly can.” Have inspectors and contractors make solid bids While it might add some cost and time, inspections are imperative to uncover hidden problems that could be a nightmare down the road, Day said. In the same vein, Day recommends that investors walk through a property with a licensed contractor to detail what work needs to be done and how much it will cost. Adjust your budget accordingly and then limit additional flourishes to the project. “Having your licensed contractor walk through the project and give you solid, firm bids is incredibly important to staying on budget,” Day said. “Make sure that you're checking yourself when you're putting in those little splurges and make sure that they really fit the budget.” Track homes sales data Tracking properties that have already been sold is an important step in setting a competitive price. To determine your house value, find homes that are similar in size, condition, and location. Compare similar listings’ prices for an extended period to gain a better understanding of your market and to maximize your returns, Day said. “Knowing your comparables before you buy is huge,” she said. “Track more than six months in previous home sales. Track it for a year or track it for two years to find what the true comparable is, because one house can change the comparable for a neighborhood really quickly.”
Gary Rohman Photography
W hen you see “Bar- gain Mansions” host Tamara Day on television swinging sledgeham- mers, grinding metal, and installing sheetrock, it’s not just her construc- tion and design skills on display. It’s also a reflection of a do-it- yourself mindset that was instilled in Day as a child growing up on a small town family farm. Hiring out- side professionals for home projects wasn’t an option, which meant Day, her parents, and her siblings would roll up their sleeves together. “I grew up with the mentality of ‘You fix it and you figure it out,’” Day
said, recalling her youth in Salina, Kansas. “As I've grown up, I've never been afraid of projects and I’ve al- ways been willing to just get it done because that was what you did.” As a young child, Day remembers an ongoing series of big home proj- ects. She and her siblings were al- ways helping hands in the family’s renovation and construction work. Even punishments incorporated some DIY training. “I remember I got sent to time- out for something, and while I was sitting on the staircase, I had to put wood putty in all the nail holes,” Day laughed. “I think that
farm mentality has been a huge benefit to me in my career because I've seen things break, I've broken things, and then I've just figured out how to fix them.” The confidence to break, fix, and build things is now a core part of the mission with her HGTV show, “Bargain Mansions.” Now finished with filming its second season, the show follows Day as she uncovers neglected, large houses in the Kan- sas City metro area and transforms them into glamorous homes. Now a proud mother of four, Day’s journey to national television and DIY fame, however, wasn’t a straight line.
AWINDING PATH TO DAY’S DREAMS While she may have cultivated a gritty, do-it-yourself mindset on the farm, Day didn’t consider a career in construction and design until after college, she said. Without a clear career path for herself, Day earned a communications degree from Kansas State University and took up creatively unfulfilling sales jobs. “I didn't realize those were op- portunities for me growing up on a farm,” she said. “I didn't know a designer. I didn't know somebody who does construction. I didn't know those were an option.”
It wasn’t until Day and her hus- band Bill purchased a fixer upper home for the family just before the 2008 financial crisis. As with many homeowners, the Days were hit hard by the economic downturn and the timing couldn’t have been worse. “We had purchased our house
before everything crashed — it was a foreclosure and in really rough shape,” Day said. “We were mid-construction when the world came crashing down.” But rather than wallow in defeat, Day tapped into her self-determination to transform her family’s situation.
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Tamara Day’s Top Weekend DIY Projects to Boost Home Value
After more than a decade of rehabbing houses, revamping interiors and building custom furniture, “Bargain Mansions” host Tamara Day has curated a vast catalog of do-it-yourself projects that increase home values. And as more real estate investors look to quickly boost returns, more sellers are turning to old-fashioned elbow grease to finish home improvement projects themselves. To get more ideas on some valuable 48-hour projects, Think Realty recently sat down with Day to discuss her top weekend projects that can help investors increase their profits.
PEOPLE STARTED WANTING TO BUYTHE
Wallpaper isn’t what it used to be
Long viewed as outdated and onerous, Day said that wallpaper has significantly changed in recent years. “Wallpaper gets a bad rap from the 80s, but it is new and fresh and really can transform a space with color,” Day said. “It’s my go-to transform-a-space tool.” In addition to new, stylish designs that add color and character, wallpaper has become easier to install and remove. DIYers also can use updated materials such as vinyl-coated fabrics, solid sheet vinyl, grasscloth, and more to distinguish the design. Adding wallpaper to small spaces — such as laundry rooms, mud rooms and half bathrooms — is a fun, creative way to bring personality to your space, Day said. “Make those small spaces that you pop in and out of during the day a fun space to be in,” Day said. “It's inexpensive, it's quick and easy to put up, and it really can make a huge impact.”
grocery store, word of mouth, and social media. … We’d have about a thousand people come through in a weekend and [they] would clear out the house.” After a few years of custom furni- ture and interior design consulting, Day eventually was discovered by Kansas City-based production com- pany Conveyor Media. Recognizing her skills to transform spaces, the company was excited by the pros- pect of sharing Day’s talents with a national audience. Day, however, still recalls her skepticism before the first meeting with the show’s producers. “I felt the odds of this not being a VINTAGE STUFF I WAS DOING SO I STARTED DOING OPEN HOUSES IN MYHOUSE TWICE AYEARWHERE EVERYTHING ON THE ENTIRE FIRST FLOOR WAS FOR SALE.”
Light fixtures that add glam Updating light fixtures can not only better illuminate a home’s transformation but also enhance its revamped design. With most installations taking less than an hour, trading out light fixtures is a fast way to add beauty and charm to a space, Day said. “Changing out a light to be unique and awesome is a quick, easy swap,” Day said. “It can take a room from just a basic boring box and turn it into something glam and awesome.” In addition to new, stylish designs that add color and character, wallpaper has become easier to install and remove. DIYers also can use updated materials such as vinyl-coated fabrics, solid sheet vinyl, grasscloth, and more to distinguish the design. Adding wallpaper to small spaces — such as laundry rooms, mud rooms and half bathrooms — is a fun, creative way to bring personality to your space, Day said. “Make those small spaces that you pop in and out of during the day a fun space to be in,” Day said. “It's inexpensive, it's quick and easy to put up, and it really can make a huge impact.”
home and a handful of young kid- dos, Day began scouring Kansas City area garage and estate sales to find furniture. After lugging the pieces home, Day would refinish them to fit the home’s style. Over time, friends, neighbors and colleagues began seeing Day’s talent for creating beautiful pieces of furniture. “People started wanting to buy the vintage stuff I was doing and so I started doing open houses in my house twice a year where everything on the entire first floor was for sale,” Day said. “We’d just promote it through flyers at preschools, coffee shops, the
“I just took on the project my- self,” she said. “I knew how to do a lot of things, so I just hired subcon- tractors to do each category that needed done and said, ‘Don't bring a second hand. I'll be the second hand. I'll carry your bag. I'll do whatever you need.’ So, I worked day and night to finish our house.” After finishing construction, how- ever, Day faced another challenge: affordably furnishing the completed home. Again, Day employed a fru- gal, do-it-yourself approach.
Add curb appeal with a color pop Buyers often form their first impression of a home before they step inside it. In addition to creating an inviting impression, a home’s exterior is typically reflective of what to expect inside. That’s why Day recommends sellers paint their doors a bright color as a quick, inexpensive method to add character and distinguish it from the neighbors. “The exterior of the home and the curb appeal of your house is huge,” she said. “You can make such an impact with a bright and fun colorful front door. Mine is bright orange.”
FURNISHING SUCCESS With a finished but unfurnished
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scam is low,” she said. “I was just anticipating it being a waste of my time and I didn't really put much into the first meeting because there's nothing else like this in Kansas City.” Five years later, Day now has filmed 28 episodes of “Bargain Man- sions” that reach a national audi- ence through HGTV’s DIY Network. Covering anything from home im- provement to landscaping, the DIY Network is in more than 53 million homes across the United States. “My youngest son told me that I have the coolest job of anyone
he actually knows, except for (former Kansas City Royals first baseman) Eric Hosmer,” Day said. “It constantly surprises me when somebody says I'm inspiring them and that they are being impacted by what I'm doing. It’s been a huge blessing in my life, in my children's lives, and my husband’s as well because they get to see that there's really no limit to your dreams.”
ral Kansas helped cultivate Day’s design style. “My appreciation for design comes from the lack of design in my own home growing up,” she said. “I remember babysitting for families, and I'd go in and say, 'Someday I'm going to have a house like this.'” While her parents were keen to fix or build most anything on the farm, aesthetics were often an afterthought, Day said. That lack of design has shaped not only her style but also a penchant for thriftiness. “My parents were spending their
money on sheetrock and two-by- fours — they didn't have highly designed spaces,” she said. “There was hand-me-down furniture and that sort of aesthetic in our homes. They were always very cozy and homey when I was little, but that made me really appreciate beauti- ful spaces.” Thanks to such experiences, Day’s style has evolved to become what she calls “laidback luxury.” “It’s affordable, attainable but aspirational,” she said of her style. “We all have something special that we love and want to incorpo- rate into our design. Maybe there's an item that you just really aspire to have be a part of your home, but just because you put that one fancy item in your home doesn't mean that everything else has to be at that same level. Having a mixture of things that are attainable is important and makes it something that a family can live in.” AMISSION BEYOND DESIGN An unexpected joy from her tele- vision show is the positive impact it’s having on young women, Day said. Too often, girls are pigeon- holed into societally imposed inter- ests and careers, she said. Through “Bargain Mansions,” Day hopes to empower women to work toward their dreams whatever they are. I get messages from moms and little girls all the time just saying ‘Wow, I want to be like you,’” Day said. “It's been eye-opening to me what a difference it makes to them.” Just as she initially steered away from a male-dominated industry of construction, Day hopes to now serve as an example to girls and women that they can thrive in the industry. “When I grew up, I didn't know that I could swing a sledgehammer. I didn't know that girls could be in construction. It just was not on my radar growing up,” she said. “So to hear from little girls that this show
CRAFTING HER OWN STYLE In addition to a can-do attitude and solid work-ethic, life in ru-
Photo courtesy of DIY Network
is giving them the confidence is really awesome. Having a mind- set of anything's possible and not being afraid of messing up is really important.” •
Bobby Burch is the Founder of Bobby Burch Creative, a small business storytelling studio. Learn more at bobbyburchphotography. com and contact him at
The "Belinder House" renovation in Leawood, Kan. | Photo courtesy of Nate Sheets
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age find themselves working year after year without making much progress in wealth-building. By investing in real estate, I’ve found one can experience more financial freedom and a more se- cure financial future. For many of us, the goal is to be able to leave a legacy behind, both professionally and provisionally. A portfolio of real estate rental investment properties with positive monthly cash flow, for example, is every bit as legitimate as a stock portfolio, and it’s more fun to create. In addition, your odds of picking and maintaining a solid real estate investment are much higher (and have a better long-term upside) than beating the stock market by accumulating hot stock tips, courtesy of your colleagues who are investing their hard earned dollars on a whim without doing the required homework, an all too familiar experience for my friends in the healthcare field. ALTERNATIVES TO SFH INVESTMENT PORTFOLIOS In networking with new real estate investors, I’ve found the pri- mary investment vehicle they read about or see on television is the single-family home (SFH), either in the form of a flip or a buy and hold. Don’t get me wrong, I enjoy watch- ing the transformation of living spaces on TV just as much as the next person, but while a portfolio of these homes is a great investment, there is a downside. Each home re- quires significant maintenance and management to turn a profit. I’m beginning to dig into an easier and more cost-effective version of this model, which is the multi-family unit — duplexes,
triplexes, and quads. The cost for these homes is often comparable to the cost of an SFH (depending on where you buy), while generat- ing two-to-four times the monthly income. In addition, when the maintenance and management for multiple units is centered in one building, you can save time and money on both. If you are just starting out, I suggest taking a look at this niche and considering the possibilities it presents. Create a snowball effect: purchase your first building, pay it off as quickly as possible, then use the equity to help finance your next acquisition. A consis- tent program of portfolio building can start generating significant passive income in just a few years, even while you continue to acquire new units. LONG-TERM BENEFITS In terms of creating genera- tion-spanning wealth, you can’t do better than investing in real estate for the long-term. Because your heirs inherit the portfolio at its stepped-up value, they are sheltered from capital gains taxes. You can tap into the equity value in your golden years (like Abhi and I plan to), then pass the portfolio on in your will, creating either an investment vehicle or a significant cash-value commodity. •
Healthy Passive Income
a uniquely valuable resource for this type of financial strategy, and Abhi’s expertise in that field has been invaluable in helping us cre- ate a plan for passive income and long-term gains. I feel this is an approach that healthcare profes- sionals should take as it helps to secure one’s future while minimiz- ing many downside risks. FINANCIAL CHALLENGES IN THE HEALTHCARE PROVIDER COMMUNITY With student debt sitting at unprecedented levels and the desire to provide the best for their families, healthcare professionals are uniquely squeezed financial- ly. While many of my colleagues went into medicine at least in part because of the perceived financial freedom it brings, a high percent-
A HEALTHCARE PROFESSIONAL SHARES HER STORY AND WHY PASSIVE INCOME MATTERS FOR EVERYONE.
by Vanessa Engineer, M.D.
inning the money game means different things to
ed to write a book titled HEALTHY PASSIVE INCOME: A Fun, Disci- plined Investment Methodology for Busy Healthcare Professionals. My husband (real estate in- vestor and Think Realty resident expert, Abhi Golhar) and I have taken a long-term view of financial planning and investing, one that encompasses the notion of gen- erational wealth building rather than short-term acquisition and spending. Real estate investing is
different people, especially to healthcare professionals. As a researcher in the healthcare field, I have conversations about wealth building with my colleagues on a regular basis, and one thing stands out to me, time and time again: the concept of building wealth doesn’t exist in the healthcare community as much as it should. So, to inspire healthcare professionals, I decid-
Vanessa Engineer is a medical doctor, author, and real estate investor. She and her husband, Abhi Golhar, offer advice to help people do more with the
money they earn. Read the book and get in touch to find out how you can create a plan that works for you, your family, and your future. Learn more
and continue the conversation at www.healthypassiveincome.com.
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FINDING YOUR NICHE
acquisition methods and costs in de- tail, we were able to take a top-level view and find out what models work and what “rules of thumb” could be used to make pricing determinations quickly and accurately. Taking our investment model to another level required understanding the niche of residential renting and property management. We rented to individuals with high credit scores, low credit scores, and government subsidies. The more we rented prop- erties out and maintained landlord/ tenant relationships, the more we realized that there is a lot of subtlety to having an efficient landlord/tenant relationship. The source of income or credit score turned out to be a lesser determinate of the success of a lease
than the relationship built with a tenant. A tenant who is respected and has immediate resolution to physical problems with their property is much more likely to be retained. A tenant who feels comfortable enough to explain why their rent is behind and what the plan is to catch up is far more likely to get back on track than a situation in which communication with the tenant is limited. How you communicate with a tenant and how you handle problems is not written in a procedure manual anywhere. Learning these methods requires combining industry best practices and figuring out how your organiza- tion can deliver them. This is orga- nization-specific and a niche that we became expert in executing. Tracking
performance in any niche is essential. In property management, tracking retention rates, vacancy rates, rent
> Continued on :: PG 96
Charles Einsmann and Sam Jacknin each bring 20+ years of real estate experience, especially in distressed property
sales and development, to Clear Sky Financial. They co-founded Clear Sky Properties LLC in 2005 before co-founding Clear Sky Financial LLC in 2013. Sam owns and is principal broker for Green Dot Realty. Both Charlie and Sam are licensed Realtors in Virginia, and Sam is also a licensed Realtor inWashington, D.C. and Maryland. At Clear Sky Financial, Charlie primarily takes the lead for networking, sourcing new opportunities, and negotiating new deals, while Sam primarily takes the lead for loan closing and administration duties. Learn more at www.cskyfinancial.com.
Developing a Niche WITH SO MANY AVENUES TO PURSUE IN REI, WHICH IS RIGHT FOR YOU? THE ANSWER IS MORE THAN ONE.
by Sam Jacknin and Charles Einsmann
o gain the depth of knowl- edge essential to becoming
investment portfolio indefinitely. The market changes and the inves- tor must adjust to new realities and find niches that work with the new market conditions. We have iterated our business model by moving from one niche to another. Initially, we began investing in residential real estate and under- standing the nuances of selling and renting renovated properties. This niche expertise came from repeating the acquisition, improvement, renting
and resale model over and over again. Each time we purchased an asset, we identified the nuances of the acquisi- tion process that made the buy suc- cessful. During each renovation, we tracked the timing and cost associat- ed with each repair. Learning what re- pairs cost in general and then diving more specifically into repair cost at a granular level allowed us to develop expertise on renovation cost control. We didn’t do this on just one project but on dozens. After understanding
successful, it is important for real estate investors to develop a focus. Taking the time to build a deep level of understanding in a spe- cific area is integral to long-term success. Once a particular mar- ket is mastered, the investor can move on to additional areas using the same in-depth approach. This niche approach is iterative. A single niche is insufficient to expand an
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BABY BOOMER RENTERS A “hands-free” lifestyle is not just appealing to Millennials, how- ever. As one of the fastest growing groups of renters, Baby Boomers are contributing to strong demand for affordable rental homes that cater to their lifestyle preferences. According to Census data recently analyzed by search engine RentCafe, the num- ber of renters aged 55 or above rose 28 percent between 2009 and 2015. Projections estimate that this number will continue to increase over the next decade. A 2016 Freddie Mac survey found that the top factors influencing the types of rental homes in which Baby Boomers are choosing to spend their retirement years include the type of available amenities (44 percent), a desire for less home maintenance (41 percent) and less responsibility for the property (30 percent), and being close to family (31 percent) and other adults of the same age (25 percent). What this data shows is that rental homes that appeal to Baby Boomers will offer some or all of these fea- tures. Like Millennials, Baby Boom- ers are often looking for amenity-rich rentals in good locations. They are also increasingly looking for long- term rentals. “Even among renters who have experienced a rent increase in the past two years, a growing number – 64 percent – stated they do not plan to move, up from 49 percent in August 2017,” Freddie Mac report- ed. “This includes a noteworthy 70 percent of baby boomers.” Because of this growing trend, the demand for rental homes with quality upgrades and accessibility features is on the rise. As one of the most affluent generations, Baby Boomers are accustomed to a certain quality of living space. Rental homes that can offer upgraded features and landlords who make consistent improvements will be far more attractive to this
generation of renters. Baby Boomer renters are also looking for rental homes that will accommodate their accessibility needs for years to come. Rental homes with few or no stairs, accessible doorways, and other fea- tures (or a landlord willing to make accommodations) may be a strong factor in which rental home a Baby Boomer renter ultimately chooses. According to population projections from the U.S. Census Bureau, as of 2019, there will be 73 million Millen- nials and 72 million Baby Boomers in the United States. Together, these demographics are a force to be reck- oned with. Despite their differences, one thing that both Millennials and Baby Boomers have in common is a desire for rental homes that meet their needs, offer quality amenities and support a fulfilling lifestyle. Understanding which demograph- ic your rental property best appeals to — and how to market to them effectively — can ensure shorter vacancies and better long-term tenants for years to come. The ex- perts at Real Property Management understand how to attract the type of quality renters that property own- ers want. Our market research and property assessments will identify the most profitable upgrades and target demographic, giving property owners a distinct advantage over the competition. • FINDING YOUR DEMOGRAPHIC
This content is brought to you by Real Property Management
sential facet of their lives. Millennial renters are also looking for rental homes that will accom- modate them as they shift into new life stages. Currently, in their 20s and 30s, Millennials are a gener- ation in transition. Many are both career- and family-oriented and looking for a rental home with prox- imity to jobs and education as well as varied social amenities. Accord- ing to a recent CNBC article, Millen- nials are attracted to “full service” rental homes, which include things like concierge and housekeeping services. Such rental homes are attractive to Millennials because it frees them to concentrate on what they value most — fulfilling lives.
APPEALING TO TODAY’S LARGEST RENTAL MARKETS IS KEY FOR RENTAL PROPERTY OWNERS.
by Lukas Krause
MILLENNIAL RENTERS As a group, Millennials are choos- ing to rent more than any generation before them. Industry experts at Real Property Management have identified several reasons for this shift, from difficult economic conditions and low wages to a desire for proximity to social amenities. As young profes- sionals, Millennials are looking for rental homes that offer more than a roof overhead. They want properties and landlords that align with their
oday’s single-family rental home market is dominated
interests and values. One primary interest of the Mil- lennial generation is smart-home technology. According to the Rental Housing Journal, more than ever be- fore, Millennials want rental homes that are capable of smart technology integration. In many ways, today’s young adults enhance their social and professional lives with smart technologies. This means that when given a choice, they will choose a rental home that supports this es-
by two large generational groups: Millennials and Baby Boomers. Eco- nomic conditions and shifting gener- ational values have created a large base of long-term renters in each generation who are looking for rental homes that fit a certain type of life- style. This is why for rental property owners, understanding what attracts each demographic to rental homes is the key to long-term success.
Lukas Krause is the President at Real Property Management, the largest residential property management franchise organization in North America,
managing tens of thousands of properties for individuals, investors, and institutions through the country. Learn more at RealPropertyMgt.com or call 888.806.7088.
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