Chapter IX: "Consistent, Persistent Action: The Formula For Success" with David Dodge

00:00:00
Today I got the opportunity to chat with David Dodge of discountpropertyinvestor.com. And David's been in real estate for, I don't know, he's been a real estate investor for, I think, almost 20 years. Started out doing rentals, did those for ten years. But he says he was doing it wrong for the first ten years, and then he moved into wholesaling, flipping, and now he's a huge fan of the burr method, and he's got a really inspiring story. We talk about a lot of adversity that he had to go through, including the death of his mother and, and then later his father's passing.

00:00:45
And so essentially, he grew up without a mother, and then at 18 and on, didn't have any parents. And I think that probably contributed as to, it was a contributing factor as to why he ended up kind of going down a bad path for a little while there. And he got into some legal trouble based on, because of activities he was deciding to pursue and the crowd he was hanging out with. And.

00:01:17
Yeah, so that's really interesting. But he took that problem and turned it into an opportunity, and I can't wait for you to, to find out how he did that. He is absolutely crushing it now. He's in the St. Louis, Missouri area, and he and his partner are extremely active in their real estate and coaching business, and they bring in $20,000 a month in income from their real estate.

00:01:42
So definitely checks all the boxes as far as adversity and abundance. And like I said, he's funny, energetic. He's just, was a pleasure to talk with. So I know you're going to really enjoy this one. Thanks.

00:01:56
Inspiring stories of real people overcoming incredible odds to live life to the fullest. We are all guaranteed to face hardships. How will we handle the adversity? Join us to be moved by everyday people who have turned poverty into prosperity and weakness into wealth. Be inspired as these relatable heroes get vulnerable.

00:02:17
And former counterintelligence investigator Jamie Bateman puts his interviewing skills to the test. Restore your faith in humanity as you experience true Cinderella stories of average people turning surreal struggle and deep despair into booming businesses and financial fortune. Take ownership of the life you are destined to live and turn your adversity into abundance.

00:02:46
Welcome, everybody, to another episode of the from adversity to abundance podcast. I am your host, Jamie Bateman, and I'm very excited today to be joined by David, the discount property investor Dodge, if I said that correctly, David Dodge of St. Louis, Missouri. David, how are you doing today? Man, I'm doing fantastic.

00:03:05
Jamie, thanks for having me. I'm excited to get this opportunity to share some value with your audience this morning. So I'm really, really grateful to be here. Awesome. So I know your name is out there already, a good bit in the real estate space and, you know, entrepreneurial world, if you will, but for those listeners who are not familiar with you, who are you and why should we listen to you?

00:03:28
Yeah, great question, man. Why should you guys care, right? So my name is David Dodge. I am the discount property investor. That's the name of my entity, discount property investor.

00:03:41
I've been buying real estate for about 18 years, done about 1000 transactions. Um, but the, the thing is, is the first ten years, I did it wrong. And over the first ten years, I basically bought a house a year and I bought rental properties. That was kind of what I wanted to do when I first started. And at the end of ten years, Jamie, I had twelve rentals.

00:04:08
So I got lucky. Two of those ten years was I was able to buy two houses in a year versus one house in a year. Right? And, you know, the way I was going about doing it for the first ten years, again, very passively, was I would locate an agent first and then that agent would help me find a property. I was getting ready to say a deal, but they're not deals.

00:04:31
They'd help me locate a property and then I would, you know, make an offer on that property and, you know, maybe get a thousand or two or three or five discount. But like, that's nothing. You know, like basically paying full retail for these properties. And then I'd walk into a bank and I'd get a bank loan and the bank would say, hey, David, we're going to give you 80% of what the purchase price is, assuming that the appraisal is at or above that number. But at the end of the day, it was 80% loan.

00:05:00
That's it. Right. So the average house I was buying in the first ten years is, is still about the average house price that I'm buying today, which is about 150,000. Here in the midwest, 20% of 150 is 30k. So I had to put down thirty k twelve times over the first ten years.

00:05:20
That's $360,000 that I either had to save up to put down or in the very, very beginning, for the first two or three that I did, I borrowed the 30 grand and then got a bank loan, and then I paid the 30 grand back over the course of a year, two or three. Right. The way I said, slow process. Very slow. So the reason I say that it was the wrong way is because it's slow, like you said, and it requires you to have 30 grand to put down on $150,000 property.

00:05:49
So if you're in a market where you can't find $150,000 properties and the properties are 300 grand, you need 60,000 to put down. That's very difficult. So about seven, eight years ago, I went full time in the business. I had twelve rentals already, and I decided that I just wanted to be a full time real estate investor. And I didn't want to be an agent or a broker.

00:06:09
I didn't really feel like doing that kind of job. So I just kind of, you know, started reading books and taking courses and hiring, excuse me, hiring coaches. And I essentially learned and taught myself wholesaling. And for the next three to four years, Jamie, I did that exclusively. I just wholesaled.

00:06:29
Wholesaled, wholesaled like crazy. And in the last seven years, I've done 750 wholesale deals. So I've done quite a few wholesale deals in just the last, you know, seven, eight years. That's incredible, by the way. It's pretty neat.

00:06:40
Yeah. Yeah. But here's the thing, man. I started out with rentals passively for ten years, got twelve, and then I went full time. And for the next, let's say, three and a half to four years, all I did was wholesaling.

00:06:52
I, like, lost sight. I lost track of the reason I got into real estate. I got into real estate for. For two or three reasons. Number one, I wanted to have passive income, right?

00:07:07
Because I wanted financial freedom. And I knew that having passive income would allow me to have both financial freedom but also time freedom, right? So I wanted to stop trading your time for money. I want to stop trading my time for money, right? And then, number two, I am terrible at saving money.

00:07:20
Like the worst. The worst, right? So, you know, whenever I go buy a rental property and I put money into it or I borrow money to get. To get it, and then I pay that money back, it's like a forced savings account. Sure.

00:07:34
So I've. I've always been terrible with money. I'm still not that great at saving it, you know? But when I buy rentals, it, like, forces me to save it. It's not very liquid.

00:07:43
It's. It's. It's out of sight, out of mind. It's liquid, but not very. Correct?

00:07:47
Correct. Yes. Right. We're not like it. Not like a savings account.

00:07:51
Like, not like a savings account. Right. So you know about. Oh, I don't know. I guess, you know, another three.

00:07:57
Let's just say three and a half years. I did that full time. So then the following three and a half years, I, like, you know, had the epiphany. I woke up and I'm like, man, I got into real estate to, like, be my own boss and to, like, save money and to, like, build wealth and to create passive income. And I'm not doing any of that.

00:08:13
I'm just wholesaling. I'm making a good living, but, like, man. So I pivoted back into buying rentals. But this time, I decided to try to figure out and learn a way to do it that didn't require me to put down 20%. Or in my case.

00:08:28
Cause I'm buying $150,000 properties, 30 grand. And I stumbled across the burr method, and I didn't create the method. I didn't invent it. I have written a book on it. There's other books written on the topic.

00:08:41
I'm not the only guy, by any means. Brandon Turner likes to take credit for the. And that's fine. Yeah, I'll give Brandon the credit. I know Brandon.

00:08:49
I've met Brandon. He's a great guy. Love Brandon. Right? No, he didn't.

00:08:52
He didn't invent it either. No, he didn't invent it. No, but he likes. He coined it, maybe that. That term, but he was the first.

00:08:58
Guy to write a book on it, probably, right? Yeah. Yeah. So, no, I've done it as well. It's some version of it.

00:09:04
That's what, you know, I do. I have rentals as well, and that's really the primary method that we've. My wife and I have used for. For our rentals. It's super powerful.

00:09:13
So, you know, there's no perfect strategy there. There can be. If you don't know what you're doing, you could get in trouble. But so you kind of sounds like you now are at a point where you've blended, and correct me if I'm wrong, but you've blended multiple strategies that you kind of had mastered over those, really, decades, actually. And now you're kind of being more intentional about how you're approaching your own business, and you're.

00:09:40
So you're able to hang on to a lot of these properties that you otherwise would have wholesaled before. And. Yeah, that's a great. Okay, so check this out. So the first ten years, I wanted to be a landlord, but I still had businesses and jobs and whatever it was, let me turn this on focus mode here.

00:09:56
And, you know, it was very passive. So then I went full time, and I spent, you know, three and a half years, roughly wholesaling. But I wasn't buying rentals. But I built a skill. I built a skill of marketing to sellers, negotiating, putting properties under contract, and finding partners to sell them to.

00:10:16
So, like, all of those skills that I earned were massively helpful. Right? Yeah. So then, you know, after that three and a half years, let's just say three and a half. That's just a simple, easy, round number.

00:10:28
The preceding three and a half years, that leads me to today. I'm still wholesaling, but we've changed the mindset, and now it's, we're going to keep the best deals that we get from our marketing efforts, and we're going to wholesale everything else. So we literally have a saying, keep the best wholesale the rest. So you can cherry pick. Yep, and we cherry pick.

00:10:47
So what we're doing now with the ones that we're cherry picking and we're keeping is we're using the burr method. And for those that aren't familiar, Burr's an acronym. It's b with four r's. It stands for buy, rehab, rent, refinance, repeat. Very, very simple strategy.

00:11:02
If I was to define what the burr method is, my definition is simple. It's a strategy that we, that we real estate investors use to acquire assets with little to no money very rapidly. That's the way I define it. Sure. And the, the way that the Brrrr method is so beneficial is because it doesn't require me to bring in 20%, like in the past, or 30 grand to buy a property.

00:11:32
But we do a whole, we have to go through this whole process, um, to be able to do that. So I'm going to shorten it, and we can, you know, elaborate a little later if we want. But what we do now is we find a deal, just like we would if we wholesaled. We market, we find a deal and then we offer to buy it, just like we would if we wholesale. Right.

00:11:50
We put it under contract. Right. But instead of marketing that deal to the cash buyers, now we market that deal to our private lenders. And we have a couple of them that we work with, seven, eight, nine of them. And we have some hard money lender friends that we work with as well.

00:12:03
But it's a little bit more expensive using hard money than it is private money. So we market the deal to our private lenders, but not for sale. We market the investment opportunity to them, and they say, hey, David, you know, we'll lend on this one. We want 12% annual no points, hopefully. And we're like, yeah, no problem.

00:12:20
We're only going to borrow the money for three or four or five months anyway. So 12% isn't the total amount. That's an annualized figure. So we'll buy the property with the private or hard money lender, and then we'll also borrow an additional 20, 30, 40 grand, whatever we need to rehab it. So the first letter in the acronym of Burr is b, buy.

00:12:38
But you got to buy at a discount, folks. You got to buy at a discount. I'm going to say it a second time. It's so incredibly important. Right.

00:12:44
So then we rehab the property, and we use the same money that we got to purchase it a little bit more from that lender, typically, right? Occasionally we'll have to bring a second lender in, but 95% of the time, it's the same lender. One lender. Got it. One lender.

00:12:58
Right. So then we'll rehab the property. Now, rehabbing the property does a bunch of stuff. It increases the value. It allows you to rent it for more money.

00:13:07
It allows you or helps you get it rented quicker. Sure. And it reduces a lot of the capital expenditures. Capex, hopefully for five, seven, maybe even ten years. So when we're buying these properties and we're doing these rehabs, we love the big ticket items.

00:13:23
In fact, those are the first things we typically do. Roof, windows, siding, if needed, h vac flooring. And then we'll look at the kitchens and the bathrooms and the walls. But that's the last thing we look at. We want to do the big items first, because those are the items that cost a lot of money.

00:13:41
And down the road, 5710 years, we don't want to have a $7,000 turnover cost. We want to keep it low. So the rehab, it does a lot for us. Right. Then we go.

00:13:52
We get it rented, and then we go to the bank. So I'm still going to the bank, like I did in the beginning here, Jamie, but now I'm not going to the bank. In the beginning, I was going to the bank asking for them to help me buy a home. It was a new loan. It's a new loan.

00:14:06
It's risky for the bank. There's a lot of underwriting that's required. Well, now we already own the property. We've already rehabbed it. We've already rented it.

00:14:14
Right. So the bank's like. And. Yeah, and they will count that rental income as part of your. They will come when you.

00:14:20
So now the bank's like, holy cow. Hell, yeah, we want to. We want to do this refi. Yeah, we like this house. Yeah.

00:14:26
It's been rehabbed and it's already rented, so it's not a liability. It's actually an asset. Yes, David, we would love to refi this. Well, they still do the same, 80%. But here's the kicker, folks.

00:14:39
I'm not going in buying a property that the purchase price is equal to the appraised value. That's how I did it in the beginning. There was very little, little capture of equity. If anything, it'd be a couple grand. Right?

00:14:54
Because you know, the bank, the appraiser is going to say, well, what. What are you offering to buy it at? You're offering to buy it at 160? Well, you know, my job is to tell you what somebody else would pay you for it, and you're offering to pay 160, so it's probably worth 160. I mean, their job's very easy on the purchase side.

00:15:10
It's very easy. That's literally what their job is, is what is your opinion of value? Well, when you buy a property at a discount, you fix it up, you get it rented, and then you walk into the bank and you say, I want to refi. They don't care about your purchase price anymore. That number is irrelevant.

00:15:26
Sure. What matters now is what's the damn thing worth? So let's send the appraisal out. So the goal with us now with the cherry picking, to keep the best and wholesale, the rest is can we be all in with purchase and rehab? All in of what the appraisal comes back at?

00:15:43
Which is a guess, but can we be all in at 80% or less? And if we can, which we've done about 200 times now, I think I'm at like 197 bird deals to call it 200. Then you've got, if we can be. All in at or below 80% and the bank lends 80%, we can acquire the asset with no money. No money.

00:16:06
And oftentimes I can pay the lender back 100% with the interest, and I can use the loan to do it all to where I don't have to come out of pocket a dollar. So the average amount that we started with, I started with to buy a rental was 30 grand. And over the last three and a half, four years, I brought that average down to $1200. So after, you know, four or five months of cash flows, you don't. You don't have any money invested into the asset.

00:16:35
Your returns are infinite. It's amazing. That is awesome. So, okay. Yeah.

00:16:40
And I definitely want to dive into that more later. I mean, that is super powerful. I mean, you've got no money in the deal or very little. And then I think the key thing with the. Well, there's several key things, but the last r is repeat.

00:16:56
Oh, is the repeat. And so it's like, that's critical. Whereas your, your previous, your first ten years, you weren't repeating until twelve months later because you had to save up all that cash to be able to put down that down payment. With this burr method, you can repeat immediately and you can go find as soon as you have a deal good to go. So that is definitely very powerful.

00:17:16
Um, of course, there are some things to be aware of and, and potential, you know, pitfalls along the way. Obviously, if you get, you know, if you can't get that bank loan, you might be, uh, stuck holding, holding the bag with the hard money lender or whatever. But, um, I don't have to tell you that, but just for the, for the listener out there, you know, you don't, uh, you do need to get some coaching and know what you're doing before you, uh, just go start doing this. But, um, one thing I want to dive into, David, if you don't mind, is more of your background. Yeah, absolutely.

00:17:49
We can bring it up, bring it up to speed, you know, up to the present again, and then talk about more specifically what you have going on today. So, yeah, yeah, let's. You can take it wherever you want. I mean, you've, you've done hundreds of shows. You have your own podcast.

00:18:02
You, you're very comfortable with this, which is awesome, makes my job easy. And, but this show is from adversity to abundance. And it can be either professional or personal, but some real, you know, some real pain or some adversity that you've faced as a human. I mean, we're trying to focus on the human element of real estate investing, the human element of running a business, the human element of overcoming hardship, overcoming struggle, and then getting to adversity, excuse me, abundance and growth. And you get the concept.

00:18:43
And for the listener out there, we don't. It's not like we just flip a switch and all of a sudden all of our problems go away. But a lot of it has to do with mindset and lessons learned through the adversity. So what comes to mind, David? What do you, what do you want to talk about?

00:18:57
Jeff? Yeah, man. So I've had a lot of adversity in my, in my life, and it's led me to abundance. So I can. I can.

00:19:05
I'll be happy to talk about this. So, you know, some of the adversity that I faced was really more so younger in my life than it has been recently. Okay. But it has molded me and it has shaped me into the person that I am today. So, you know, I lost my.

00:19:22
I lost both my parents before I was 18. I lost my mother when I was nine, and I lost my father when I was 18. So my dad did a great job of raising me, you know, up until I was 18, which I was still a child at 18. You know, they say you're legally an adult at 18, but I was a kid still, and, you know, so growing up without a mother, you know, was, was difficult. It wasn't, you know, impossible by any means, but it definitely brought some challenges.

00:19:51
But then losing my dad at the age of 18 was really tough because I didn't have any parental guidance. I have an older sister, you know, who's always kind of had my back and kept an eye on me, but she's not my mom, she's not my dad. She's my sister. Sure. And I've had other family, you know, aunts and uncles and grandparents that have obviously been there to help me and to help guide me, but at the same time, they're not your parents either.

00:20:13
Right. Right. So at the age of 18, I was out on my own. And luckily, my grandparents, you know, were, were really good savers. I'm not a good saver.

00:20:25
They were, and they were like, hey, we would love to have you go to college. You know, we're going to pay for it. And I was like, holy cow, this is amazing. Like amazing people. Angels on my shoulders.

00:20:34
So they, they helped me, you know, go to college for four years and help cover some of those, some of those costs. I paid for a little bit of it, but they paid for the majority of it. But because I didn't have any parental guidance, man, I got in a lot of trouble in college. I just was hanging out with the wrong crowd and, you know, was doing a lot of activities that we wouldn't refer to as being good activities. And, you know, a lot of these activities were very illegal activities.

00:21:00
And, you know, I got myself into a lot of trouble. And, you know, at one point, I was, you know, standing in front of a judge facing seven years in prison. Oh, wow. Or certain, you know, activities that, that I was doing and the judge took mercy on me and was like, you know, you don't have any parental guidance. I think I was, like, 24 at the time, you know, and, you know, and I was crying up on this, up on, you know, in court, and.

00:21:27
And, you know, I didn't want to go to prison, you know, so the judge took mercy on me, though, and they. And she said, you know, we're not gonna send you to jail. Cause this is your first, you know, basically, big offense here, but, you know, this is real. This is real life, and if you keep, you know, screwing up and messing up, you're gonna go to jail, dude. And they ended.

00:21:48
She ended up giving me house arrest for nine months, man. So I was on house arrest for nine months because of my activities. This was in college still. You said in college just when it started, but it rolled over into, you know, into my early twenties, too. Right.

00:22:03
Got it. Yeah. And, um. But, you know, the thing was, though, Jamie, that that was one of the best things that ever happened to me, to be honest. I mean, it's kind of crazy to think about that or to even say that out loud, but, yeah, no, and.

00:22:15
Just to quickly jump in, that is one of the things that, you know, we've. It's been one of the themes with the shows we've had thus far is that. And, of course, this takes time and reflection. Right. You don't see this in the moment typically, I would.

00:22:28
I would assume. Right. But looking back, it's. A lot of people have said similar things with very painful, you know, traumatic experiences they've been through. Is that it is the best thing that ever happened to them.

00:22:39
One of the best things that's ever happened to me. Absolutely. So why do you. Why do you say that in your. In your case?

00:22:44
Well, because if I hadn't gotten caught doing what. What I was doing, I would have. I would have still. I would have kept doing it. Yeah.

00:22:52
You know, so. But, yeah, long story short, it was one of the best things that ever happened to me. I straightened my life out. I quit messing around with the crowd that I was messing around with. I quit messing around with the substances that landed me in that courtroom.

00:23:10
And, um, you know, I realized at that point in time that, you know, I had been. I had been kind of veering down the wrong path since the age of about 18. So that was, you know, about seven years that I was, like, kind of up to no good, you know, and, um, long time for the most. And it's, you know, almost a third of your life, it sounds like, at that point, a third or a quarter of your life. Yeah.

00:23:31
So my point is, long time, you're building and you're very, you're. You're building habits and patterns and things. So it's. It's not like you wake up one day and you're just, you know, oh, that's over. I imagine that was quite a process.

00:23:45
Yeah, it was, man. It was. It was quite the process. But it led me to going into real estate full time. So again, it was.

00:23:53
It was a godsend. It was a blessing, right. The fact that I was able to avoid a harsh sentence, you know, was, was, was amazing. I still got punished. I had nine months house arrest from, from my actions, and I had an additional four years behind, behind that of supervised probation.

00:24:14
So I was getting drug tested and I couldn't. I couldn't leave town without, you know, having a probation officer breathing down my neck. I had to check in with them, you know, once or twice a week, random drug tests, all that stuff. Right. So it wasn't just nine months house arrest, it was four years of supervised probation.

00:24:33
Oh, wow. That was the punishment. So the punishment was, you know, it was. It was tough. It wasn't easy.

00:24:39
Yeah. You know, I mean, it wasn't prison, but it was still punishment. Yeah, that's. That doesn't. But here's the thing, man.

00:24:45
When I was on house arrest for nine months, I read like a hundred books. Couldn't leave my house, man. So I just was like, all right, and I'm not a big reader either, trust me. It takes me a whole day to read a hundred page book. But I was just like, I'm just going to learn real estate investing.

00:25:00
I've already got some rentals. I already know how to do it the wrong way. Let's learn how to do it the right way. And during that time, I. I probably spent 50 grand on books, courses, and even a couple of coaches along the way, too.

00:25:14
And I was buying courses online, you know, weekly, you know, if anything, and everything on rental property, fix and flip, landlording, wholesale lease option, creative finance, sub to, you name it. I was learning about all this stuff and just. You were working at this time? At the time. So right before I got in trouble, I had bought a house to rehab.

00:25:36
So luckily for me, I was a full time real estate investor, even though I wasn't doing a ton of transaction. I just had one house that I was fixing up. So I was able to leave my house at like 08:00 a.m. But I had to be home at like 06:00 p.m. And that was only five days a week.

00:25:54
So the weekends I couldn't leave. I basically had a really early curfew, and I wasn't allowed to leave very early. So I had a gap. I had a time that I was allowed to go work a job, essentially, but instead of going to a job, I would go to this house. Got it, and I would fix all of it.

00:26:08
And that ended up taking me like seven months. So almost the entire time I was on house arrest. Um, but it was such a great opportunity to learn how to do plumbing, how to do roofing, how to install windows, how to do flooring, how to put in cabinets. Like, I had friends that would come help me, that I'd pay, but I didn't hire anybody ever, like, hey, I need you to do my kitchen. It was always like, I want to learn how to do the kitchen.

00:26:31
You know, how. So I'm going to hire you, but I'm going to be your assistant, like it or not, you know? And they were like, uh, okay, you're still going to pay me? And I'm like, yep, I'm still going to pay you, but I want to be there every second of the way to see how you're doing this and learn the process. Sure.

00:26:46
So I did kind of have a job. It was a self employed job at the time. Right, understood. But for the most part, yeah. That, that opportunity led me into education of learning, you know, what not to do, which I had been doing for ten years, and how to market direct to seller.

00:27:02
I did my first wholesale deal, you know, while I was, you know, dealing with that. And once that I was, you know, able to leave my home again, you know, freely, I went and got an office and partnered up with a couple of my buddies, and we just started marketing like crazy. Direct mail, cold call, cold text, bandit signs. I got some radio ads running. We've had billboards in the past, a lot of networking, adwords, SEO, all these different things that we can do to get direct to the seller.

00:27:32
Right? Yeah. And then once I was able to get direct to the seller, I was able to then learn how to negotiate and how to lock up properties and how to wholesale those properties. So again, it was such a great opportunity, but it all led from a bunch of bad decisions, hanging out with the wrong crowd, and then ended myself in court, facing jail time. I mean, it was to dive into a little bit is, and I, and I appreciate that.

00:27:56
You said you made bad decisions, right? And that's you know, I'm not trying to. This show is not 100%. I did. I made that decision.

00:28:06
But, you know, I love that you took ownership of it and you ended up seeing this as an opportunity versus only a problem. Right. But the other thing you've mentioned a couple times was hanging out with the wrong crowd. Right. And so how did that go as far as just kind of like, because your environment is so critical for, you know, for all of us.

00:28:24
Right. Um, so I understand that you had forced, you know, certain things were forced upon you from the court system, but how did you tactically, kind of. Did you have to say, like, hey, hey, man, I'm not. I'm not going to be friends with you any longer. Like, how did you.

00:28:40
Yeah, I had. I had basically done that prior to, okay, you know, the feces hitting the fan using cuss words here. Right. So, yeah, I had basically done that prior. You know, we all kind of knew that we were going to get in trouble for the most part.

00:28:57
So I just kind of separated myself from these individuals, and I just told him, hey, this isn't personal, but, like, I don't want to go to jail, so. But I wish you the best of luck, and if you're ever in a really, you know, bad situation and you need a helping hand, you can call me, by all means. I'm not telling you that I don't want to ever talk to you again, but we can't hang out anymore. And I just separated myself from these individuals. So then you were focused on coaches and reading and absorbing all this knowledge and growing your positive influences.

00:29:24
Right. And then, yeah, so I mentioned earlier, I'm not the best at reading, but here's the crazy part. I love. I love learning new things, man. Like, I've always been a good student.

00:29:33
I've always enjoyed school. When my grandparents were like, hey, we want you to go to college, I was ecstatic. I'm like, I get to go learn for four more years. Like, this is amazing. So whenever I was in my, you know, in that timeframe of my life where I was in trouble and things were not looking great, you know, it was another opportunity for me to learn.

00:29:54
So, you know, hiring coaches and taking courses and, of course, reading books and I didn't even mention, listen to hundreds, thousands of hours of podcasts just like this one and learn from other individuals who were already wholesaling, already had hundreds of rental properties, and just picking up little gold nuggets along the way. I love to learn. I'd love to learn. Then I love to learn now? Yeah.

00:30:13
You know, so, I mean, it was. It was one of these things where it was like, holy cow, I dodged a bullet. And then now I get to. I get to learn. Like, this is.

00:30:21
I mean, it was like, it was a lot of bad things that happened all at once, but then it was, like, a lot of good things that came from it. And that's really where the abundance came from. And I have a lot of abundance in my life now. You know, I've done a thousand transactions. I got about 90 rental properties.

00:30:39
We bring in about 20 grand a month in passive income from our. Our rental portfolio. Just to be clear, when you say we, and, you know, we don't have to get into specifics if you don't want to, but is. Is that. Who.

00:30:51
Who's we? Who is we? My partner, Mike and I. Okay, that's. That's.

00:30:56
That's amazing. That's awesome. That's really impressive. I just. You're, like, you clearly are not afraid of hard work.

00:31:05
Um, clearly, like, learning and growing and the abundance mindset, it just. It sounds like you just had to get yourself on the right track and get, you know, make sure you were exposed to positive influences. And. And, um, it's. This.

00:31:20
This is a really good, uh, turnaround story. Uh, so it's. Yeah, it's impressive, man. Thank you. Thank you, man.

00:31:27
Thank you. You know, it's just one of these things where, like, I always wanted to do real estate, and I dabbled, and then. And then I jumped in, but I jumped in, and I was blinded by a shiny object, which is wholesaling. And I'm glad. I don't have any regrets, but I'm glad that over the last, you know, three and a half call, four years, that I brought my focus back.

00:31:48
Sure. You know, I bought my first house when I was 20 years old. I house hacked. I was at. I was in school.

00:31:55
I was house hacking. I borrowed that 30 grand I got. Actually, you know what? House hacking is the one that Brandon takes credit for the term.

00:32:04
I'm a fan of Brandon. Love it. But. And I know house hacking is super powerful. It is.

00:32:10
And I did that three times while I was in school. So I was actively investing and buying rentals and doing this, you know, but again, I lost sight of it when I started wholesaling, but I brought it back. And, you know, at this point, our goal is, is to acquire rental properties that are assets that we can use the burr method and we can use the burr method to get into these with very little to no money. And then the last r that I skipped over, but thank, thank you for reminding me was to repeat. And now it's so scalable.

00:32:41
So now, you know, we can go pick up five, six, seven houses in a month where I was doing one, maybe two in a year in the beginning. So question and then we'll get, we'll do some rapid fire questions before we wrap up, but as far as your business right now, are you adjusting anything based on market conditions or. Um, we're, yeah, I mean, we're, we're always adjusting stuff. I mean, really, the interest rates are going up. That's, that's a given.

00:33:09
So we're, we got to find better deals. You know, inventory is low. Yeah. And, yeah, inventory is low, so it's hard to find good deals. I mean, we used to stumble across two, three, four deals a month.

00:33:20
Just stumble across them. Right. And now, you know, we're lucky to get a property under contract weekly. You know, it's just. Are you buying in?

00:33:29
Just in. You must be, you know, have a pretty good footprint. We have about a hundred mile radius around where we live and work. My office is eight minutes from my house and I'm, I'm happy to buy something and flip it or rent it out if it's within, you know, an hour, hour and a half. I would say 90% of our portfolio is within 25 minutes away from, from our office.

00:33:49
So it's, we're hyper local, I guess you could say. So. You know, I don't, I'm in St. Louis, Missouri, and I don't own any property outside of Missouri. Everything I got in the state.

00:34:00
You are the expert in that area. I mean. Yeah, yeah. Oh, yeah. Absolutely.

00:34:04
Absolutely. I've been in the game for quite a minute. And, you know, 750 wholesales, 200 bir deals, roughly a thousand transactions. So geographically, you're the expert. And then also it's like you have so many tools in your tool belt, no matter if a deal goes sideways, you still have an option, you still know what to do.

00:34:22
So, yeah, everything we do is buying at a discount. Hence, hence the name of my show and, you know, my nickname, David, the discount property investor. And I think that is a. I'm sorry, go ahead. Oh, no, no, I was just going to say, here's the thing, guys.

00:34:35
If you buy a property retail. Yeah. Can you make money on it? Well, the answer is yes. It's just so slow.

00:34:43
Right. And you're going to typically need money to put down to buy it too. Right, right. But if you buy a property at a discount, all of the exit strategy doors, they're wide open. If you want to wholesale it, you can make a profit without even buying the home.

00:34:57
If you want to add it to your rental portfolio, you can use strategies like subject to or brrrr. And you can get into these properties for little to no money. If you want to fix and flip that property, you've mitigated your risk a ton. Can you buy a property and increase value from rehab alone? Yeah, but it's not going to be a huge increase, typically.

00:35:18
But if you combine that forced appreciation from fixing it up with the discount or the, or the captured equity on the, on the get go, you've doubled your spread. Now, it's a very good point. What I teach people is regardless if they want to wholesale, regardless if they want to fix and flip, regardless if they want to be a landlord and, you know, 2.0 landlord, a burr method landlord like me and you, regardless of what they want to do, they need to learn first and foremost how to buy properties at a discount. Yeah, I truly believe that that is the first step that anybody should take. You don't have to be a wholesaler if you don't want to be a wholesaler, but you need to learn how to find discounts.

00:35:57
And I'm going to just say one more thing, and before we wrap up here, Jamie, we can do a fire round. Of course, too. But when it comes to buying properties, you got to get a discount on those properties. And when I first started out, I was looking at properties that I would buy to fix and flip or add to the portfolio, you know, as how much profit can I make? And I don't look at it that way anymore.

00:36:20
Now I look at it, am I buying it at a big enough of a discount where I can screw up two, three, maybe even four times and still make a couple dollars or even break even. Right. So at this point, I've pivoted my mindset to is the discount deep enough to where my bookkeeper could manage the rehab and screw it up and I'd still make money on the deal. That's pretty good. So you got to learn how to buy at a discount.

00:36:42
Oh, here's the point that I was trying to make. Yeah, the. Well, no, we're good. That's all good. We'll go with that.

00:36:51
The same thing applies. So we're mostly focused on mortgage notes. I mean, rentals are an important part of my own personal portfolio, but same exact thing applies. And you can get into the argument of. So the way I look at both of our businesses, really is, it's three parts.

00:37:07
One is raising capital. And you talked about that with hard money and private money and then the bank. The other is finding the deals. And the third part is managing the assets. Right.

00:37:16
But if you don't buy a mortgage note at a good enough discount, you just put a ton of stress on yourself to make something out of nothing. And it's the same philosophy and concept is true in notes. If you don't buy at a discount, there's a good chance you're screwed or there's nothing there. So why not set yourself up for success? I mean, I think Warren Buffett has the same philosophy.

00:37:45
It's all about the buy, right? Yeah. Value. Value. Investing value.

00:37:48
Exactly. Buy it at a discount and then, yeah, you can make money. So. Oh, here's the point I was trying to make, and I literally slipped my mind twice, but it came back to me. We've averaged about 100 purchases a year.

00:37:58
Last year we did 160, which is a little crazy, but we've averaged about a hundred hundred purchases a year. And the point that I want to make is, you know, two or three out of 100 come from the market like the MLS on market. The other 97, 96, 98, whatever that number might be, let's say 97%, that's probably a good number. Don't use, come from direct to seller marketing. There's no agents involved.

00:38:28
Sometimes there may be, but they're not on the market. They're direct to the seller. And what we do as investors is very simple. My way of defining it to a newbie is this, we exchange convenience for discounts. That's it.

00:38:45
That's the simplest of definition of what real estate investors do. If you want to go buy a property retail and fix it up and try to make a profit, go for it. You're not going to make that much money, typically, but if you buy it at a discount, you might not even need to fix it up to make money on it. Right. But the best way to buy discounted properties is go direct to the seller.

00:39:04
Find sellers that have problems. Right. Find people that are distressed or they have a distressed home, or the holy Grail would be to find a distressed person that has a distressed property and you offer them, you offer them convenience. Do you help them? I mean, at the end of the day, we're helping people, right?

00:39:21
We're solving someone else's problem. Yeah. We're saying, hey, we'll take this off your hands. We'll pay you for it, too. Now we're not going to pay you full retail, because this is a business.

00:39:29
And by definition, business means the act of making money. So, of course we're doing this to make money, right? But we're offering convenience to people in exchange for discounts. That's it. It's so simple.

00:39:41
So if you are brand new and you're listening, understand that. Understand that this is a marketing business before it's an investing business. And then number three is as you make your money when you buy, you get paid when you sell, it's really, really good. All right, we're going to fly through a few questions and wrap it up. What's something that people misunderstand about you?

00:40:02
Oh, man, I'm a clown. I like to laugh and have jokes and, you know, I like to love, love, you know, love life. So I think sometimes people, they think I'm a jokester out the gate, and it's just like, I just want to make people laugh, you know? That's good. All right.

00:40:17
If you could have coffee with any historical figure, who would it be? Meaning that they've already passed away. They could be alive. Anybody? I'd say Elon's the best we got on the planet.

00:40:29
He's the best. So I would love to be able to meet him. That would be cool. I just saw. Do you see his ending the work from home thing the other day?

00:40:37
Yeah, I think it's amazing. Yeah? Yeah. If you don't come here, if you're not here physically, we'll just assume you're not working. We'll just assume you're not working.

00:40:44
Yeah. I love it. I think you ordered it perfectly. He is incredible. It's amazing.

00:40:49
All right, if you were given, let's say, $20 million tomorrow, what would you do with it? Oh, I'd park it because I'm terrible at saving, I'll tell you that. So here's the thing. I would much rather have income coming in monthly or quarterly than a big nest egg. Because the nest egg you can spend, you can blow it, but the income, if it comes in routinely, like, for instance, our rental portfolio pays us about 20 grand.

00:41:12
My partner Mike and I, we can go below every nickel of that. And then on the first of the month, the next month, we got 20 grand more coming in. So what I would do with that money is I would buy real estate. I'd park it, and I would try to get my passive income up to, you know, 800 grand, a million million, $500 thousand, whatever would equate to. Because then it's impossible to go broke every month, you get more money coming in.

00:41:34
So to me, it's never the big, the big number, which is most people's goal. You turn that retire, turn that into cash flow. It turned into cash flow. Yeah. Having a big, a big number in one spot scares the hell out of me.

00:41:47
You know, it's going to be gone. So what is a, what's a challenge that you're facing in your, in your business right now? Finding good deals, man. Inventory is light. Yeah, got it.

00:41:57
Um, in your opinion, you've already covered some of this, but in your opinion, what's one of the most important personality traits for someone who's someone to be successful in, in your industry? Okay, so any industry. My definition. Oh, you're saying. Yeah, so I'm actually going to build on that.

00:42:15
Any industry. Got it. All right. My definition of success comes down to three words. Consistent, persistent action.

00:42:25
I literally interviewed a 17 year old last night. He's one of my coaching students, and he just got his first wholesale deal. He made eleven grand. And I said, what was the main thing that you took away from my coaching? And he said, you got to be a persistent sob if you want to do deals.

00:42:42
And I said, yep. And I asked him, I said, how many times did you touch that seller with a phone call, a text message, you know, an email? Just a touch? And he said, oh, at least 40. I go, you know what?

00:42:54
A newbie would do two or three and then stop. That persistence allowed you to do a deal. So, in real estate, to answer your question, persistence. And in anything in life, yeah, sure. It's persistence, guys.

00:43:06
You can't be. That's great. Weak. You got to be persistent and consistent, like you said, and an action taker. So all the above.

00:43:16
Consistent, persistent action is the equation that equals success, guys. It is. No matter what you want to do, you can't quit. You got to be consistent. You got to be persistent about it.

00:43:26
Yeah. And it doesn't mean you never pivot. You talked about several pivots you made with yourself. Oh, yeah, we pivot all the time, especially with marketing. If marketing is not working, then we stop and we find another thing to.

00:43:36
Do all the time. All right, what's a movie that you'd recommend? Ever watch movies? Yeah, I love movies, man. I would say I just saw the new top gun.

00:43:46
It was amazing. Love that. Nice. Yeah, check that out. What other podcasts do you like?

00:43:52
You have your own, right? So I host the discount property investor show, and I also host Wholesaling Inc's podcast, one day a week. Okay. I love both of those. I'd recommend those.

00:44:03
That's how I met you is through Brent, who interviewed me on that, on that show last year. It's not. Great team of people over there. Great team. So I would say those two would be my two faves just because I spent a lot of time working on both of them.

00:44:16
Perfect. Two more. How do you like to serve others? I like to serve others by showing them that they have more value than they think they have or they know that they have. And I like to make them laugh because it just brings joy to their life.

00:44:31
Love it. All right, last one. And you've touched on this, but where can our listeners find you online? Yeah. Yeah.

00:44:37
So discountpropertyinvestor.com is my main website that hosts my podcasts. If you guys are looking to learn more about the burr method, that's really my passion at this point. I do have a program that you can learn more about it and that you can find that@wholesalinginc.com. Rentals. Again, that's wholesalinginc.com rentals.

00:45:01
You can learn more about me, you can learn more about the burr method, and if you're curious, book a call with my team and we can, you know, kind of put together some of your goals and wants and put together a plan to help you achieve them. Awesome. Cool. This has been really good, David. You have a ton of energy and you just.

00:45:21
You bring it. Hey, thank you so much for having me, Jamie, like I said in the beginning, so I'm honored to be here. I'm grateful for this opportunity to, you know, serve and provide value to your audience. So I couldn't be happier this morning. So again, thank you so much for including me.

00:45:37
Appreciate that. And to the listeners out there, we appreciate you spending your most valuable resource with us, and that is your time. Thanks, everyone. Take care. Thanks so much for tuning in to this episode of the from Adversity to Abundance podcast.

00:45:52
If you're enjoying the show, please feel free to rate, subscribe, and leave a review wherever you listen to your podcasts that helps others find the show, and we greatly appreciate it. Thanks again for listening, and we'll catch you in the next episode.