Joshua: Yeah, I learned with tenants by the way that you’re never … first of all, they never know I’m the owner, and I always blame it on the owner.
Chad: Yes! Oh my god, me too.
Joshua: They’ll be like, “Oh, can I get like three more days to pay?” “I talked to the owner and he’s just not about it. You got to get the payment in,” blah, blah, blah. So I always blame it on the owner and they never know I’m actually the owner.
Speaker 4: This is Start FM. Now here’s your host, active real estate investor and entrepreneur, Chad Duval.
Chad: This episode of Start FM is sponsored by HoneyBook. HoneyBook is the management software that I just started using to stay organized, manage my invoices, get paid, and give every client an elevated, unforgettable experience. HoneyBook is offering 50% off your first year exclusively for you guys, Start FM listeners. Just go to share.honeybook.com/startfm to get started and get your life back today. Thanks to Buildium for supporting Start FM, and right now Start FM listeners can try Buildium for free for 15 days. When you go to chadduval.com/buildium. There’s absolutely no risk and you can start your free trial without even entering your credit card. You guys, this is the software that I used for my first few properties and let me tell you, it’s super easy, it’s cheap and there’s plenty of room to grow as your business grows. Again, to sign up, go to chadduval.com/buildium, that’s B-U-I-L-D-I-U-M. Well Joshua, welcome to this show. How are you doing today?
Joshua: Doing great, appreciate you for having me.
Chad: Yeah man, no problem. This is awesome. I’m glad we got to connect. We’ve been going back and forth on Instagram a little while and I’ve been admiring from afar, and this is awesome that we can actually chat a little bit and understand a little bit where you come from, where you are now, and hopefully bring some value to the audience and help them start in real estate. So I guess if you want we can jump right into this and give us a little bit of a background of who you are, where you are right now, and then once we get through that we’ll kind of circle back and then kind of unpack that first deal.
Joshua: Cool. Well my name is Joshua Morris. I’m a local real estate investor in Colorado. I also do buy in North Carolina and Texas. Primarily what I focus on is single family homes, whether that’s wholesaling, fix and flipping, wholetailing, lipsticking. It doesn’t matter if it’s condos or whatever. So I do some smaller repositions on multi whenever I get the opportunity, and currently just flipping real estate every day, doing deals out in North Carolina and Colorado and last year I acquired 50 properties and just keeping it moving this year.
Chad: Oh wow. I didn’t realize you were doing that much. That’s amazing man. That’s awesome.
Chad: Nice. So you’re doing a lot of flipping. So was that the first way that you ended up getting into real estate, was a flip? Or was it just basically … I feel like a lot of common ways to get in is you buy your first house and that ends up being the accidental landlord situation. So yeah, was it a flip?
Joshua: Sure. So the first one was actually a wholesale, but it was all kind of accidental in a sense. Actually, originally when I was starting, I started going to real estate school, and long story short, I talked to a friend and they’re like, “Well, what do you want to do?” And I was like, “Well, I want to be an investor,” and he’s like, “Well then why are you being a realtor?” And I was like, “Well, did you ever get your license?” He’s like, “No, I have people that do that for me,” and I was like, “Dang.” Yeah, so basically I stopped real estate class and I started posting ads on Craigslist for properties, and I knew, more importantly, it wasn’t about raising money or finding buyers. Without product, you can’t pay for it, and without product you can’t sell to your buyers. So I started posting ads on Craigslist, and long story short, someone hit me up off Craigslist.
Chad: Oh wow, that’s awesome. So Craigslist does work. That’s awesome.
Joshua: Oh, totally.
Chad: That’s awesome. That’s awesome. So I’m actually curious, so you’re talking that you had a buddy that kind of steered you into the direction of wholesaling, or at least keeping you out of being a reator, and I was just curious where did that relationship come from? Was that an old time friend or did you stumble into that as well? Cause I know a lot of people when they’re first struggling to start, it’s always trying to build that team, or make connections and stuff like that. So it seems like you had that connection and I just was curious how strong it was or how you found them as well, cause that’s a huge competitive advantage, I feel like, if you’re just getting started in real estate.
Joshua: Yeah, so I had a couple of people I could reach out to, a couple of really good friends. The person I was talking about was actually my good friend’s father.
Joshua: So that’s kind of how that conversation happened. Basically she’s like, “Hey, will you let me know what kind of questions you want to ask him? I can get them for you,” and I was like, “Oh, okay.” So that’s where I heard that, and I also had another friend that was doing a bunch of flips and wholesales out in Texas. So I would periodically ask him questions because, I’m green, I’m new, I don’t know what’s going on.
Chad: Nice. So where exactly was that property? Cause I know that we were talking before the show that you grew up in the Northeast too, not too far from where I am. So what’s it somewhere in the Northeast or was it where you are now?
Joshua: No, this was in Colorado, so it was off Bolson Way in Arvada.
Joshua: Yeah, and the guy just hit me up and I know nothing about real estate, so I go and look at the property and we’d come up with a price. During this time, the subfloor was slanted. I don’t know if that’s foundation issues or anything, so it was ridiculous. I mean literally when we were negotiating terms, my partner and I were sending the contract back to him for him to revise it the way he wants, so totally no control over the deal at all.
Chad: Wow. So are you able to get into a little bit of the numbers? I’m curious, was it a really cheap $50,000 deal? Are we talking half a million? Because I know for a newbie it might be hard to start into a half a million dollar house to flip, or at least wholesale, you know?
Joshua: Yeah. So this property, it was roughly in the 240’s, and we went under contract, and it’s also the biggest house on the block by like 800 square feet.
Chad: Oh wow.
Joshua: So I don’t even know how to comp it right, I don’t know anything, but yeah, I put it under contract for 243, or something in that range, and long story short, after posting it on Craigslist and leaving the address and having people peek through the windows, and make all the amateur mistakes, I found a buyer that was very legit and sold it to him for 298 or something. I ended up clearing $48,500.
Chad: Holy cow. That’s awesome, man.
Joshua: Yeah, all within a month too.
Chad: That’ll definitely get you addicted really fast. That’s an amazing first deal. That’s awesome. So actually, you brought up some good little tidbits there, not putting the address of the property on Craigslist. So would you recommend people not do that? Cause I guess I’ve never done wholesaling, so I’m actually curious about this, how that all works. I mean, now that I’ve purchased a few properties and that sort of thing, I kind of understand how it works, but I guess I’ve never gone through it. So all these little tips like that are worth their weight in gold, because I’m sure there could be some issues with that.
Joshua: Yeah. I mean things that I know now is don’t put the actual numbers of the address. Another thing I do is if I have a picture of the front of the house and there’s photos on the email blast, I make sure that the actual property numbers are blocked out on the picture. That’s another mistake I made. I was like, “Oh yeah, I got rid of the address,” and then I forgot the fricking numbers were on the photo. So those are two tricks.
Chad: Okay, nice. Nice. So that’s crazy. So you did your wholesaling deal there. You said it was really quick, within a month. Now did you continue to pursue the wholesaling, cause you cut your teeth on it, or were you at the same time looking at trying to expand into your flipping and that sort of thing? I mean, I guess wholesaling’s kind of flipping, but it’s not actually doing the construction. So you got a taste of it, I guess, but how did it progress from there?
Joshua: So from there, obviously I was definitely pretty pumped, so I just started doing the same thing, posting ads on Craigslist. My partner and I, we just started doing direct mail, and long story … I mean this was like immediately right after that. So we just started marketing. I can’t remember if we’re hitting some equity list or whatever, but I remember we were probably two or three months in, no deals and about $17,000 worth of direct mail, and we have this conversation, “Hey, do we just stop doing this or what?” And long story short, we’re just like, “Well, I mean, we have the money, we can keep doing it. So let’s do it.” Two weeks later I get two calls, two properties under contract at the same time, whole tailed one, wholesaled another and made 160 or $170,000.
Joshua: Yeah. So those are my next two.
Chad: Wow. Man, you had some great … wow, that’s insane. So actually, I think you already said, but when did you start this? What year was this?
Chad: 2015, okay. Yeah. Okay, wow.
Joshua: So, yeah, that was a very interesting moment, and the thing that was crazy for me is we had this discussion two weeks before we got those deals and it’s like, “Do we keep going or do we stop?” And the answer was keep going, and somehow the universe kind of worked its way. I mean, yeah, it’s kind of crazy.
Chad: So are you still working with him today or are you –
Chad: You are? Okay.
Joshua: Yeah. We still do deals to this day. We expanded into North Carolina. I actually have two partners for North Carolina.
Chad: Wow. So building out your team. So that was ’15, so yeah, four years later. Wow. That’s impressive man. So you’ve been flipping, you’ve been wholesaling, and I’m assuming that’s where you plan on keep going? Or do you have any ambitions on … I know you’re expanding to different markets. What sort of plans are in the future for the business itself?
Joshua: So currently about 15% of the businesses wholesaling, the rest is basically wholetail, lipstick, or rehab.
Joshua: So that’s mainly what I’m doing right now, and moving forward, it’s the same thing. Yeah, wholetail, lipstick, or rehab.
Chad: So now one question I really like to ask everybody that comes on is when you first started, what is one thing you wish that you knew that you know now that you wish you knew right before you started? Cause I feel like there’s a lot of unknowns when you’re getting into real estate. It looks like this big scary monster, which it really isn’t once you get your first deal. But what are one or two things that you think that would help somebody take that first leap into investing in real estate that you know now that you didn’t know back then?
Joshua: Sure. Well, you’re totally right, too, and I remember having that first deal and it was like 243,000 where I’m like, “Oh my God, how are we going to figure this out?” It was very daunting. So obviously what I know today is superior of my first deal, obviously. So if anything, I wish I knew more when I was looking at a deal. You can have all the leads in the world, but if you don’t know how to work those leads, you don’t see those opportunities. You might have a deal in front of you and it might just walk from you cause you have no idea what you had. So if anything, just knowing that … I’ve lost deals before cause I just didn’t know.
Chad: Okay. Wow. That’s awesome. That’s awesome, and then also I want to transition into one other quick question. So I know there’s a lot of realtors or even bankers or contractors that’ll be listening and of course you’re dealing with those guys on a daily basis, and that’s another thing I’d like to ask is what advice do you have for these people that you’ve dealt … like even just one person that you’ve dealt with in the past, what’s some advice … if you could talk to them right now, what advice would you give them to help them in the future? Cause I know for me, I deal with banks and there’s certain things … I worked with a bank once that was insanely unorganized and they ended up not approving me, but I had four other banks approve me and I feel like their unorganization definitely hurt them. They didn’t get my business. So do you have any scenarios like that, through the past couple of years that you could speak to?
Joshua: Sure. So it doesn’t matter if it’s realtors or bankers, there’s the 1% for a reason, the top performers. Well what makes them different is part of it’s just habits, and their persistency and the way that they operate business, their followup’s on point. I mean there’s so many variables to their habits that make them the top 1% of their industry. So if anything, know your product, know your service, and be a master at it and just be relentless.
Chad: Yeah. No, I 100% agree with that, and I think a lot of that goes back to you got to have passion for what you’re doing as well, because you’re not going to be the best if you’re not having that passion. I feel like a lot of realtors get into it … not even just realtors, I think a lot of people get in real estate in general, I know I did at first, was because you see the big money. You think it’s an easy way to make money, which you get into and it’s not easy. I mean, you make it sound easy your first couple of deals, but you know it’s not an easy thing. So if you don’t have the passion for it, I feel like you’re definitely never going to strive to be that number one player in your market. So I 100% agree with that. So do you have any war stories through all of these things, like a huge thing that you can laugh at right now? I know I’ve got a ton of them that going through whatever the story is, when you’re going through it, you wanted to quit or it was just a mess or even a good story, that sort of thing. I’d be curious to hear if you have any good ones.
Joshua: Sure. Yeah. I have a property I bought in Pine, Colorado, and it was an older style home, part of it was built with the old train trailers. So it was a mix of the train trailer and the house, and I remember getting bids on it with the foundation and some people quoted me 72,000, another person’s quoting me 42,000 and really it was crazy because long story short, when I did my inspection, I had to drop them 40 grand to make sense of it. Well I thought I could just put it on the market, sell it as is, maybe make like 80 grand. Long story short, I actually ate up 40 grand of that 80 I was expecting, so if I didn’t price drop the guy 40 grand, I actually would’ve broke completely even. I had to do all the foundation, had to do a septic tank, leach field. I mean, it was a nightmare.
Joshua: Then I had a reposition on a small multifamily, and when I acquired the property, I was responsible for the utility bills, and one thing I noticed is water was going through the roof. I’m like, “Why is this a water bill so crazy?” Well, after months of trying to figure it out, having a plumber coming out, check everything, I reached out to one of the neighbors that had been on the property for nine years or something like that, and I was like, “Hey, do you ever see water running or anything?” He’s like, “Yeah, the kids turn on the water and leave it on all night.” I’m like, “What?”
Chad: Oh no!
Joshua: Yeah, so this bill was costing me like 800-900 bucks a month too. So it was pretty hefty.
Chad: Yeah. Wow.
Joshua: Yeah. So long story short, I eventually figured it out months later, cut the water off, and my bill went from like 800-900 bucks to like a hundred, but obviously I have tons of stories of contractors and all types of stuff.
Chad: Yeah. No, and that’s so funny. I mean, you try and plan for everything, but you really can’t. I mean, who would think that somebody’s just going to leave the water on at night. It’s crazy.
Joshua: Yes. It’s fricking nuts, just little kids playing with the water and they’d just leave the water on.
Chad: Yeah, yeah. No, it’s unbelievable. I remember … so when I was house hacking, before I knew what house hacking was, my first property, I converted the basement into a small unit for myself and then rented out the two upstairs, and I was so green to everything, after I finished that, I moved into the basement, started renting out the top, and it was to a young couple. They were boyfriend and girlfriend. They were my age at the time. So I was like, “Oh, this would be perfect. They are quiet,” and then a month later into it, they’re like, “Hey, can we get a roommate?” And I was like, “Yeah, that’s fine as long as you put them on the lease,” and so they ended up moving this guy in and I can’t remember what happened, if I forgot, or he actually broke in.
Chad: But I think I actually forgot to lock up one of the doors and he ended up breaking in and stealing all the cash that I had in the house, all my stuff, all this stuff, and I was so pissed in the moment because I was like, “What the hell? I’m trying to help these people out. They can bring in a roommate to help their rent go down,” and all this stuff, and you ended up getting burned at the end of it, but it’s little things like that that you learn. So now going forward, there’s all kinds of lessons in that. Make sure you lock your door, make sure you do a thorough background check, which I didn’t on this person. I just assumed they were associating themselves with these good tenants that I originally had screened, but they ended up getting this guy off of Craigslist, and he was a known felon in the town and all this stuff, and I didn’t know. So all these little things you can learn from through all these horror stories or war stories. So it’s funny.
Joshua: Yeah, I learned with tenants by the way, that you never … well first of all, they never know I’m the owner and I always blame it on the owner.
Chad: Yes! Oh my god, me too.
Joshua: They’ll be like, “Oh, can I get like three more days to pay?” I’ll be like, “Hey, I talked to the owner, he’s just not about it. You got to get the payment in,” blah, blah, blah. So I always blame it on the owner and they never know I’m actually the owner.
Chad: Yeah! No, that’s a huge tip for everybody. It took me a couple of properties to figure that out too, because yeah, they don’t have my cell phone, they don’t have my phone number. They have the company’s number and all that stuff, and property management, but if I was to walk the property they’d have no idea, cause every time you walk a property, if they know you’re the owner, there’s something wrong with the property and you have to fix it, every single time, or there’s excuses why rent is late and that sort of thing.
Joshua: Yeah, they’re asking for favors and you give, and then they ask for more and you give, and then before you know it you’re like, “How did I get myself in this situation?”
Chad: “What happened?”
Joshua: Yeah, like, “What the heck is going on here?”
Chad: Yeah, definitely. Definitely. Do you currently have any properties as rentals? I know you’re doing wholesaling and flipping and wholetaling and that sort of thing, but do you actually keep any as you’re going through this?
Joshua: So I actually sold all of mine because the market was good and it made sense to sell. So at the moment I don’t, but I’m actively looking for bigger units, and just patiently waiting. I have a list I’m hitting and trying to find them.
Chad: Nice. Nice. So I’m assuming your market’s pretty hot right now still, right? So it’s pretty tough to find deals?
Joshua: Sure. Yeah. I mean just probably like anywhere. The whole U.S. economy is booming right now, so it’s pretty hard to find deals anywhere unless you’re in a smaller town and you’re the biggest buyer, but where I’m playing and where I’m dabbling is … there’s tons of competition.
Chad: Yeah. Yeah, totally. Totally. Nice man. Well, I mean with that being said, I guess we can transition into the final four questions that I … kind of lighten it up a little, cause I know we get into the nitty gritty a little bit about the properties and it can get a little dry. So I gave Josh a little bit of heads up about it. Like I said, they’re light and a little bit fun. So I guess we’ll start with the first question. First question is if you were to get rid of one state in the United States, which would it be and why?
Joshua: When I read that I was like, man.
Chad: And everybody who’s listening, don’t be mad if he picks your state. It’s just a very arbitrary question. It could … I don’t want to sway him in any ways, but it could dovetail into market reasons or landlord friendly states, or it could get into real estate and that’s why I chose this question, but don’t hate him.
Joshua: Well, I kept it pretty simple. I picked Nebraska because there doesn’t seem like there was much going on, besides agriculture and maybe a couple of things.
Chad: Okay. All right, perfect, and then number two, we finish this interview and then you step outside and find a lottery ticket on your doorstep and you end up winning $100 million. What do you do with $100 million?
Joshua: So I’ve actually thought of this scenario a little differently, but I thought of it like what if I had all the money in the world, in a sense, and the honest answer is I’d probably be buying bigger real estate, whether that’s skyscrapers or something, or big retail space, and on the personal side and fun side, I would buy some of my dream cars, whether it’s a [inaudible 00:21:33] or a Pagani. There’s a couple other cars I like, but I would basically start having a full time filmer film me at all these rallies and film the lifestyle of that.
Chad: Cool. That’s awesome. Yeah, and everybody, you should check out his Instagram. He’s got a nice Audi R8 that he cruises around in. It’s very nice. I’m super jealous.
Joshua: Well, it’s a fun car.
Chad: Yeah, yeah, yeah. I’ve never driven in one of. I’ve always wanted to. I’ve drove Audi’s my whole life, never up to that level of a car, but they look super fun to drive for sure.
Joshua: Yeah. I have a six speed manual version. So it’s pretty fun. It’s super mechanical and it’s a whole different drive and experience.
Chad: Yeah, definitely. Definitely. Well if I’m ever in the area I’ll have to hit you up and you’ll take me for a ride in it. Okay, and off to number three, if you could have a beer with any dead or alive person, who would it be and why?
Joshua: So I picked Elon Musk. I’m sure most people know why, but I feel like there’s still a potential chance that could actually happen too, in the sense that he’s alive. So yeah, I’d just love to pick his mind.
Chad: Nice. Nice. No, I would definitely agree with that, and then off to number four, if you could only eat one thing for the rest of your life, what would it be?
Joshua: Eggs Benedict, all day.
Chad: Oh yeah? Nice, breakfast guy. I love it. Perfect. Perfect. Yeah, I struggle with that cause I have so many favorite foods. I don’t know if it would be breakfast. I love pizza and all the cliche things, but yeah, that’s a tough one.
Joshua: Yeah, I’m a huge foodie, so that was tough for me to pack. I was thinking sushi, eggs Benny. I mean I love food, so there’s many options on that one.
Chad: Definitely. Cool man. Well those are the final four, and then I guess we can move into final thoughts. Is there anything that I should have discussed or you want to talk about that we haven’t yet? I guess now is the time we can wrap up with that.
Joshua: I mean, I’m a book of knowledge, at least in the sense of what I do. So if you have any questions or viewers, if you know they would want to ask something, I’m always about answering it.
Chad: Perfect. Yeah, and how can people get ahold of you? I know you’re on Instagram, but what’s your Instagram handle and where else can people reach you?
Joshua: Sure. Instagram is JoshuaPMorse, like Morse code. Let me think. Facebook is Josh P. Morse, and I think that’s really all I have.
Joshua: Oh, and then go to properhomesale.com and I will soon have my own personal website, joshuapmorse.com.
Chad: Perfect man, and you guys, I’ll definitely, as always, add those links to the show notes and any of the other notes that we covered in the show. So I guess with that we can take it out of here and appreciate you being on the show.
Joshua: Yeah, thank you, and I appreciate it, and yeah, kill it.