Thomas Lehmann is a seasoned real estate expert, who has achieved a remarkable journey of over 100 successful flips and 150 wholesale deals in just three years. His expertise extends from flipping properties to pioneering in the world of manufactured and modular housing.
Thomas Lehmann is a seasoned real estate expert, who has achieved a remarkable journey of over 100 successful flips and 150 wholesale deals in just three years. His expertise extends from flipping properties to pioneering in the world of manufactured and modular housing.
All right, everyone. Welcome to the Real Estate Game Changers show. I'm your host, Mike McKay, based in the Jacksonville, Florida market. And each and every week we do this show with people who are changing the game of real estate all over the country. And if anyone is looking to get into real estate in a Jacksonville area and you have sales experience, we are hiring acquisitions reps. You don't need real estate experience, but we are looking for people with some sales experience If that's something you're interested in shoot me a dm and I could show you how to apply this week on the show, we have Thomas Lehmann, Thomas welcome to the show.
Thomas:Hey, thanks for having me.
Mike:Absolutely so for the people who don't know you could you share a little bit about how you got into real estate? And how that's led you to where you are today?
Thomas:Sure. So, I had no experience. It's 2019. I had a trucking service and was doing well, but we just had a daughter like two years earlier. We have a son and I was never home weekends now. So, talk with my wife. I had a chance to jump in with some people who were investors. She said, okay, what could happen? Right? So, really got into it with no understanding of it. Didn't realize they didn't either. That wasn't probably the best move. But you know, Five years later almost it worked out pretty well.
Mike:So you were talking offline you know, you're with them for a short while, but then you started pretty quickly to jump off and do your own thing.
Thomas:Right, yeah, about a year and we're still friends, right? We have rentals together It's just that you know when you're partnering with people the dynamic has to really work you can't have one person who wants to charge ahead and one person who doesn't want to do anything And being static in this business doesn't really help at all So I made the decision I'm going to go out on my own and just took it upon myself to educate myself as best I could, like find a local mentor who was really doing well. They were doing some coaching. We share a lot of the same values that I really appreciated in. And reached out to her and she was having a class coming up and jumped into it.
Mike:Nice. And then you kind of, you were in the kind of off market acquisitions business before, and you were doing, you said you had built up like pretty large sales team, you know, you're doing quite a few flips. You want to just talk about how you kind of got from that first deal to, you know, really building that into a machine.
Thomas:Sure. So, you know, business, no matter what, it's math, right? Everything is numbers. And so I'm learning the market. I really liked back in the day texting. Okay. And when I realized that it was just a numbers game, your response rate, whatever it was going to be, was there as long as you can, you were being consistent. Okay. So then I'm doing it myself. I think it was the old batch, right? I'm pressing. You know, hitting it every time. And then I brought in a VA, right? That's, you know, yeah, everyone starts that way. Oh, I'm going to get me a VA and it's going to change everything. Well, it changes everything when you train them. Right. So. You know, brought a couple in, got one that really worked and stuck. Four years later, she's still here. But then I realized that if we were sending a hundred and our response rate was, I don't know, back then it was like 17%, what would happen if we sent five hundred or a thousand? Then what if we were doing, we had more than one account and we were doing multiple people, then we just, you know, it just became numbers and I really saw The possibility and added people, subtracted, brought in an acquisition manager and you know, the numbers were there because if you are tracking your numbers, you're going to have the ups and downs, but you know, if you're doing it, you're going to be here. Most people in the beginning don't do that, right? The lady who was coaching program or mentoring, I went to, she was big on KP. I didn't even know what a KPI was, right? Had no clue. And then once I realized the importance of it, it was something we were going to do every day.
Mike:and then talk about how you built that sales team.'cause that's like another point that a lot of people get stuck. Like they're not able, they're closing deals themselves, but they're not able to get good salespeople. How did you do that?
Thomas:You train them, right? Either you're going to bring in somebody with their own baggage. Let's be honest, because you're bringing in someone else. Someone who probably didn't work well somewhere else, sometimes. We were using virtual assistants, okay? They were on the phone, texting, getting When we got a lead in, it wasn't just a live person. It was, they answered We were really detailed on the form, okay? And, you know, it didn't go into our CRM unless we had a number. If you weren't going to give us a number And we trained them to get to that point, have the conversation, ask the question because I, you know, we had one acquisitions manager, his job was just to make the offer, but he needed all that information all the time. If he wasn't given the information that he has to do it. Well, that's what the other people's jobs are, right? So we spent a lot of time training them. It was important because, you know, you're paying an hourly too, but you're giving them bonuses on closings, right? So, they're going to do better with the more information they give the acquisition manager, so he can close their deal, right? Because it wasn't his deal, we never called it the acquisition manager's deals, it was the person who was on the phone's deal, right? It's their deal, and if he loses it, he lost their deal.
Mike:Gotcha. So they would get this in from, so they would be like a lead book coming from texting and then they would call them to get all this information or they would just get it over text or however,
Thomas:No, we always wanted to get right on the phone. Okay. Always right on the phone. And you know, as we went, one thing we did, we had three texting seats, but then we added cold calling as well. So at any time we had a team of eight to 10 working every day, right?
Mike:and then this would go to the acquisitions guy and he would call this people to make an offer, he would go out to the house, like what was the process there?
Thomas:No, he was all virtual, right? I mean, he might've went to like two houses, right? One of the reasons why I brought him in was because he was used to doing it virtual. And I wasn't. As we scaled, I was still I'd go out to the house, right? But I didn't want to do that anymore. I mean, I did it sometimes, especially if it was, you know, if it was in my personal buy box and I'm the guy I'm probably going to go, right? Because I'll walk through and after having done so many, I know my numbers, right? And I can walk through and just get my repair estimate right then and there. And, you know, I'd be the first one if it was, you know, if it was local for me, I'm going. Because I'm going to tell you right then and there, yes or no.
Mike:Yeah. Gotcha. And then he had, so it sounds like he had some previous real estate experience, the guy that you had hired there.
Thomas:Yes. Yeah, we met at a local Rio, right? We were taking right here in central Florida. They got the central Florida real estate investors association. They have this great, like two day event called jumpers for jewels. And like, we're both Jersey guys. He was sitting next to me and, you know, we were friends before he came to work here
Mike:Gotcha. And then you were also doing a lot of flipping at the time too. You were saying offline, you had scaled up to having five, you know, five different crews running all your projects. Like, how did you build that up?
Thomas:time, you know, time. And you just, as you, you build it up, you have people working and you add, right. You get your contractors in your place. You know, you always want to have your team ready, right? You want to be able to scale around them up or down. You know, you know who your roof guy is, your AC, your painter, your plumber, all those, right. Because that's the way you're going to earn your living. This is your business. and needs to be treated like that. So you're, they're part of your team, your staff too, right? But you're sorry if you can't get contractors to do the job correctly. You're in trouble.
Mike:Yeah, how did you go about finding the right guys?
Thomas:You know, man, the first three was not great. Just because I didn't know anything anyway. And then where else? I lose. I ran into a guy I knew, right? And I knew he had all the experience. What is he doing? He's a contractor, right? And, We ran for three and a half years, right? He was running it all at that point as we grew, right?
Mike:Gotcha, did you hire him like internally as like your project manager or?
Thomas:Yeah yep. He ran the crews and all that for me as a project manager for all the time, right? It was just, it worked for both of us, you know, for a long time. You know, and just as the market changed, things changed.
Mike:Yeah, so he was really handling it all so that you could focus on handling the construction side So you could focus on other areas of the business?
Thomas:I'm overwatching it, right? So, you know, one of the, if you know, there's a bunch of phases to a flip or a project in general, you know, you have to acquire it, right? You have to sell it. You gotta do all the construction, but people don't, people forget about the financing, right? When you're trying to find private lenders, and I like private versus hard money. I've only gone into a bank once for a loan, right? Bought a bunch of duplexes, they were nice enough to loan it to us. But you know, it's a relationship and what you're trying to do with every project is you're marrying a project with a person, as a lender. So you have to manage that. Because if you don't have the financing, or if the financing's not good, You know, any one of those sections or facets can make your project not profitable.
Mike:Yeah, absolutely. And then, you know, you were doing like a lot, you know, a lot of flips, a lot of wholesale deals, but we were talking offline at one point, you decided to make a transition into manufactured homes. Talk a little, tell the audience a little bit about why you did that.
Thomas:Well, you know, first off, in the beginning, when I started this, I never wanted to touch a mobile or manufactured home, right? I'm from the Northeast. We have the stigma against them. And then there was somebody who A local investor, met her at a meetup a long time ago, she whispered to me she had a really great nickname for him. She called them little metal boxes that spit cash. And she was like, you're dumb. And I'm not, okay, you know what, I bought one, it went really well, and we just kept doing that. And you know, then it became just a normal acquisition now, right? Once you get it, it's like, okay, hey, this isn't, you know, it wasn't what I thought, I was wrong, she was right, I was dumb, right? So We acquired one like normal, but you know, every deal when it has hair and there's issues, that's when they become profitable, right? Look, if the house is beautiful, they want full press. But if you have to rehab it, get rid of squatters, there's a lot of issues now, right? And so I bought a house. It was in Citrus County, right? Nice lot. House looked great, but they have squatters. And in between the time when I bought it and, you know, we got them out, the house went really bad. And I didn't even realize how bad the backyard looked because they had like an eight foot fence because I couldn't get on the property, period. Right. So, You know, higher. I don't know how you do it. But for me, when I buy a house like that, I use a local attorney in that county. I want someone local to it. I don't want to bring Orlando to Citrus County. Okay. I want someone from that, you know, who, you know, the whole system, it's a little bit different everywhere. It just is. And so we just go with a local guy, we get a ref referral and we just keep them because we're going to use them again. It just always happens. So, you know, whenever it wasn't bad, like two, maybe three months, got them out. And, you know, you could get that call from the sheriff the day before, Hey, we're going to be over there this time tomorrow. Now, I've been out there a bunch of times, just never in it. And it was on the dead end street. This was the house where people brought stolen goods to get drugs. The neighbors all knew me. I called them up, told them, Hey, tomorrow's the day. And this was July, maybe June. And they had a picnic table in one of the neighbor's yards and they were throwing a party, right? Because we were giving them their neighborhood back, you know, they had a barbecue, they had some nice beverages and they were just happy. You know, every time something happened over there, the phone rang for me. They were really keeping me in the loop. Sheriff knocks on the door, everyone's gone already, open it up. And you know, like I was telling you before, it was like the old Bugs Bunny cartoon. You could see the fleas. You could see them, right? It was Hey, not going in, right? I've been in those houses before, wife won't let me in the house, end of story, and they're hard to get out of your car. So, the other thing I noticed was the whole floor is cut, like they chainsawed it. They, you know, this was a double lie, maybe they were trying to like unattach it and take it home or somewhere else, but they they just cut my floor. And it was like, I mean, this was something new. So, I have a guy with me and he's like, hey, you just got to write this one off as a loss. And I was like, well, not yet. Let's see what we can do. And, you know, we couldn't save it, right? No way. So we tore it down and we learned the process, right? Like everything, every part of your business is just a process. And putting down a new mobile home was easier than doing a flip just was. I
Mike:Yeah. And once you saw that, did you immediately say, this is the new thing I'm gonna do, or was it kind of a slow turnover?
Thomas:think, you know, it took a while to get fully up, you know, fully up to speed in it. But I was telling you earlier, at the same time this was going on, Jerome Powell was being so nice and just raising the interest rates. And, you know, I looked at my whole business and just saw it die. Just, it was, I was seeing the future because, you know, he went to almost 8%. And You cannot ask somebody to sell me, you know, sell us your house and go move someplace else. at 8%, right? And a lot of people have refinanced anyway. They're in the threes and fours. They're not going anywhere, right? What do they call it now? A golden handcuff, right? Unless they have to, they're not. So, and I realized, this business died. End of story. What do we do next? And Mobile homes was going to be our new business, right? Simple.
Mike:Yeah. What were some of the things that you had to figure out to put a new mobile home on a property that were different than. the flip.
Thomas:Oh man, you know, impact fees, you know, I, you never you never really needed a survey, right? On a home that you're buying to renovate, right? You never needed it. You always need a survey on land. I mean, you can get burned so many different ways on vacant land. You know, ask me how I know, right? So, it that was probably the big one. Like always getting the survey. Know what your impact fees were. You have to know what your setbacks are because every county is different. And if so, if they're telling you, you know, it's so much off this side, so much off this side, but you're on a corner, it's even more right. So corner lots, they're normally bigger for a reason because your setbacks are bigger. But sometimes the corner lots are not bigger. And now you're stuck putting a smaller home on it, if anything, right? Nowadays. July 1st, all the new septic changes, right? So now they went into those new nitrogen enhanced system, right? And how expensive they can be. So get your soil test for your septic before you buy the house or the land. Because if you need the top end system, it doesn't cost you eight grand anymore. It costs you 19 grand.
Mike:And for people who don't know what impact fees are, can you share what that means?
Thomas:Yep. So, raw land is basically taxed really low. And then as soon as you, you know, you get your address is your 911 phone number. That's what it is with the county. That's where the police and fire go. But now once you start the process of your permitting, there's all these line items for fees, you know, your fire, your trash, your police, your school. And those are the impact fees that are charged to each property at completion. And they vary, but to put down a mobile home central Florida, you're about eight to 11 grand depending
Mike:Gotcha. And are you always buying vacant land or are you trying to buy like, you know, lots with like really old mobile homes on it, but you're just going to switch them out?
Thomas:we do both. So, you know, we still have some marketing. We reached out to people, you know, look, if you have a a 19. 70 mobile home and I and you're in, it's being mailed vacant and it's not owner occupied. Maybe we should reach out to him, right? Because, you know, we've bought several that way, right? And the good thing there is now you don't, well, you have to tear it down, but you don't have to pay impact fees, okay? So sometimes the tearing down of the unit might be five grand, six grand. But your impact fees could be so you save money. Okay.
Mike:Got it. So you get that credit towards it.
Thomas:Yeah. I mean, depending on where you are, it could be one year. It could be five years after you tore it down that you don't have to pay impact fees for every county is different.
Mike:Gotcha. And then Matt Rathburn asks how much do you spend on a mobile home? And it looks like he means like kind of what's your all in cost with the land and the home once it's, you know, fully installed.
Thomas:Tough question to say, because We've, you know, we've spent as much as 180 before on something, right? You know, your area is going to matter. What size unit? Did I put down a 900 square foot one or did I put down a 2000 square foot one? So right now we found a really good market for 1550, 1600 square feet. Nice land, half acre and we could be all in the one seventies. Okay. And those units there, they don't have mobile home walls. We started putting drywall in all our units. Okay. Drywall and all the units in the master bathroom has tile shower.
Mike:And is that something that you notice that when people see that they're willing to pay a premium for it, is that why you do that? Or
Thomas:You know, I don't know if it's pay your premium. But it doesn't taste that right. So when we're listing that we buy a lot and we put it on the market well before anything, we tell them what's coming. Hey, we're gonna put down this unit. And if you buy it pre construction as we're getting ready, you can pick your color of your house. And you can pick the tile in the shower now. I'm not saying it prices everybody, but if some people, they do love that. Okay? And it has helped. And a lot of people do want to buy the house before we put it down because then they can change some of the options in it, right? We give them, hey, up until this date, we can make some changes.
Mike:And are those changes, like those are happening at the, who's ever manufacturing the mobile home or Some of those are being done on site once it's delivered
Thomas:No, those are going to happen at the manufacturer.
Mike:at the manufacturer.
Thomas:Yeah. There's some things we put in, like we put in some handicap access bars for people before or after the fact, right? They told us kind of late, we never put it in, but, you know, the biggest thing you always want to do is make sure they're happy, give them what they want and need, right? You know, have the customers grateful to us.
Mike:And like if you buy an existing mobile home, like let's say you buy an old seventies one, right? You switch it out like. Do you have to do anything with the septic or the other utilities on the property to make sure that they're in enough for that home or
Thomas:Oh yeah, I mean, if the house wasn't used in so long you could be, you know, more than likely you're changing out the septic, right? every home is going to get a brand new electric pole anyway, so it doesn't matter. That's gonna go. It's probably turned off when they're that old and out of place. You know, it's just better to put all brand new in. The big, the only change could be like to keep. We'd like to keep the well if possible, right? You're not gonna drill a new well. So if you can keep the well case Then, you know, that really helps us, but it would have to been capped and everything because people, you know, you got to make sure it's in good condition and that's not us. We always bring in the service, right? You know, we want everything permitted correctly. You know, when we turn over the house, here's everything for you. Here's your warranties. This is the company. We walk everybody through it.
Mike:Yeah, and then what about financing on mobile homes? Do you find that the financing is different at all?
Thomas:So it has changed so rapidly, you know, the end of 22 yeah. You know, there was a, was like 21st century out of Tennessee. They stopped financing a lot. And it got really tight to even now people were saying, you know, if it was 10 years old, you had issues today. You can get all the financing you need, right? Single wide, double wide. The company we like to work with right here Empire, they can even get you finance. Used ones that have been moved, which is like completely brand new to me. Exactly, right? Like, oh
Mike:yeah
Thomas:Yeah and that's why we like to partner with them because they are so innovative in this field, one of the brokers and I are great friends and he has really gone above and beyond To bring these products for us, you know, not on the use stuff. Cause we can't work with that on our license, but on all the other, like, so any kind of financing for a single wide, a double wide, any program they can get, you know,
Mike:Yeah, because you're a dealer now, you're not allowed to deal and use mobile homes at all. Is that what you
Thomas:Yeah. So you have two types of licenses. You have a, a broker license. Okay. And so, a manufacturing broker, they deal with just used and our license is for just new. Okay. So it's just separated. You could get both. We just, you know, this is our lane right now. We don't see a need to go over there. So,
Mike:Gotcha. At what point did you decide that you wanted to, you know, become a dealer? And I actually don't even know exactly what that entails. Maybe talk just a little bit more about that in general.
Thomas:well, you know, it's just like being a GMC dealership down the street from your house. Probably right. Okay. It just, so when we started moving and buying units, we realized that the dealer was really killing us, not just so what's on the price, but the timeline. Okay. Our timeline kept changing. And, you know, you give him the money and next thing you know, he tells you five months, not eight weeks. You're, what can you do, right? So, after a while, we just went through the process. It took a while. We opened up a dealership. You know, we got all the paperwork, you know, my wife and I, we own several companies together, so she owns one. I own one. That's hers, right? I work for her basically, right? You know, just better that way. She's my boss. She's hard. And you know, it just made sense for us to do it so we could control everything. Look, we can put a unit down now with the same manufacturers in six weeks. How was it five months before? Now, even though they have our money, you have my money for five months, but now when I order it, I get it in six weeks, Right? And so it just, once we figure that out, we're like, okay, forget it. Let's just go through all the hoops and the expenses to get this done.
Mike:And does that, does being a dealer require you to have like a physical location? Do you guys have like an actual, like how they call it show showroom or
Thomas:Yeah, you have to have a location where you can store and show several manufactured homes. Have to. Part of it. And, you know, the state comes out and checks on it. They come out, I think they've been out three times. Right? So then you need to have the insurance, the bond, right? You gotta have several bonds, several types of insurance it's not a fun process, right? Like, like anything with any state, it's a hassle, okay? You know, quarterly reporting, monthly reporting, compliance classes you know, hate it, but it's important, right?
Mike:So when you as a dealer do one of your own for yourself, right? Is the dealer delivering it directly to the piece of land, or are they bringing it to you as a dealership and then you're responsible for bringing it over to the actual property?
Thomas:So we have it gone, right? We normally, we, Bring it right from the manufacturer straight to the property. Okay. The less you move it, the better. Okay. I mean, you just don't want to keep dropping it and moving it. It's just not a good thing. Right. So we have a really streamlined and we're really good now. Like when we were buying from a dealer, they were really hard on the delivery date. Right. So if it didn't, if it didn't work for us, we were in trouble because if they had to bring it to their lot and then bring it over, they were going to charge us. Okay. So now that we're the dealer, we can really schedule it with everybody to do it. And now the manufacturer works with us because we do a volume. Okay. You know, we, this week we sold five to customers, right? We don't do a lot of that, but we did. You know, that's not our bread and butter. It's just that I was answering the phone this week for somebody
Mike:Do you have a lot of investors who come to you and who are asking you to put, you know, help them do a streamlined process so they can get it on their place in, you know, property in six weeks or
Thomas:that's who I really was talking to this week, right? Investors. They know me. They don't mind. They got my phone number, right? And so, Hey I was just, A woman from South Florida calls me. She saw two of we did a really good one over in Hudson. I don't know if you know over there, but it's, so you have the highway on the west side of the highway is the beach, and this side on the east side is you know, all developments, but we're in the non flood zone, so I wouldn't buy across the street. She showed it and but she's from Fort Lauderdale, but she wants to buy units and Have us place it for her. And we're gonna do the placements But I outsource that to my project managers the dealership doesn't do it. They'll do that for her though on their own, right?
Mike:gotcha. They're like, they work for another one of your companies or they're just kind of like third parties that you partner with
Thomas:Yeah, they're their own companies. Okay, and It's just we as a dealer don't do that ourselves Okay. But the project managers, well, you have to be licensed to be a dealer and to set them up. Okay. Um,
Mike:licenses.
Thomas:Well, you could have them together, but it didn't make sense for me to do it, right? It's just easier to, if the equipment's kind of expensive, right? And you would never want the equipment sitting around, you would always want it working. So then it becomes a job to make sure you're having the equipment used. And I'm like, yeah, I'm not going to be like the equipment rental place. Next thing you know, we have chainsaws in the closets, right? So staying in my lane and hiring professionals who have done it a lot. Cause imagine making a mistake with your first drop and it's your own, right? How do you explain that to your wife? Hey, I dropped ours. Right. So, I just didn't see that working out good for me.
Mike:How did you find the guys who had like a lot of experience and in place in them?
Thomas:So they're on all the permits on the county website, right? Okay. And you just, you know, you start looking and you know, and like, okay, to me, real estate is all relationships. Okay. It's all relationships. And. You create a relationship with these people to where, when we, when, before we even buy the lot, we have them out, they've walked in with us. We know all the numbers, the pitfalls, right? And we're ready to rock and roll with them. Simply. As soon as we close, you get your recorded deed and we use their services for the permitting all that.
Mike:And then the other stuff, do you just sub out to different people like the septic and the well, for example, that goes to someone else or these project managers handle that too?
Thomas:Well, our project manager might handle six, seven projects at any given time, right? And they, wherever County they're in, they have their. team who they're gonna work with, right? This is my septic company. We've done enough to where we're comfortable just calling up whoever it is and saying, Hey, we have this. This is what it is. So we know what the numbers are. The only change on a well, what's the depth right on a septic? The soil test is going to determine do we need above ground or not? Are we in that map zone where we even need the new kind of septic system? You know, they have a a state overlay map and depending what color you are you either need a new one or the old type, but I think everybody is going to need the new type after next year, right? Right now, there's some areas that don't. And if you're over an acre, they don't need to have it.
Mike:Gosh where can someone find that state overlay map? I didn't even know about that.
Thomas:It's online. It came out July 1st, 2023. But what we can do when we're done, we can drop it in the chat for everybody.
Mike:cool. Yeah, I mean, I would love to look at it too, because I didn't know that and what are the other you know, you said there's about 15 line items, right? When doing a mobile versus a flip, which is, you know, 50, 75, whatever might be. What else are ones that are unique to doing a mobile home?
Thomas:mean, like with any land, you got to do your clearing, right? If it has to. And then with mobile homes, you've got to create your pad, right? It's a dirt pad. People don't realize it's just, you know, dirt underneath there. And then they put the barrier. You got to make sure you have your termites spread, right? It needs to be sprayed beforehand. It needs to be documented because when you sell it, they will ask for this, right? And you could get it done afterward. But now somebody has to crawl under your house and do it. Okay. Little different pricing. Then you once the unit gets delivered, it's, you know, the transport company just leaves it there. And then the setup company normally uses their equipment and moves it into place. Right. So then, you know, they're going to put it on the box. They're going to do the anchoring, the straps, all that's unique. Then you have to, you know, you have to, if it's a double wide, you got to combine them. You got to put your marriage line. Remember it's coming in parts, it's two halves. If it, you know, it could be bigger, right? They made triple Y's, right? There was as big as four. We haven't done a four yet. Maybe interesting one day, right? Depending. I mean, you could do a four in one side of your garage, too. I've seen it. Cool, right? They're just making some crazy things now. So You know, those are unique things, right? Cause you're literally zipping the house together and then you got to put the siding on to cover
Mike:Sure. I gotcha. And do you guys like service like all of Florida? Like if an investor wanted to do something up in say Clay County or Duval County up where we are like, is that? Or do you guys only stick to central?
Thomas:it. So we are now buying up by you in Jacksonville in that County up there, Duval County. You know, I mean, I have a lot of investor friends up there who are wholesalers and they're like, Hey. We want to find land. I'm your guy, right? And then we go over the buy box, you know. We're all in like, masterminds together, right? And, you know, and I'm an easy one to buy. If you're, you know, cause I know my numbers. And I'm not looking at land value, I'm looking at back end value. And I'm not gonna say, Oh, you're like, we bought a piece of land. It was a good value. It was like 12, 000. Right? The wholesaler had it for two grand. I don't care that you made 10 grand. I'm glad you made 10 grand. That 12, 000 price was a value to me. You made 10 and you're happy. We're friends. We're good. He's like, Oh, man, a lot of people, you know, complain. Man, I used to do your job. I'm good. I wouldn't have said yes, if the number didn't work. Right? I don't care what you're making. I'm glad you made it next time. Bring it, bring another one. Right? Yeah. Simple. Um, you know, we all, we're all in business and we have to realize that it's not about me chewing you down. It's like, if your numbers work, I'm good. But we'll work up there. We place You know, Marion County down to Highlands County right now and everything in between. I mean, that's a big section, you know? So that's our bread and butter. And there would be, say, Pasco, Hernando, Polk County. You know, that's where we do the majority right now, just because the market's great for us there.
Mike:What are the price points that I know you said you're kind of about into these things for 170 if they're about 1, 600 square feet? Like what are the price points in the areas where you're going into where you're typically selling these at? Yeah.
Thomas:to 2 65. Right. I don't like to be above that at all. You know, look, I know what interest rates are. I want to make sure we're giving a value. Okay. I never put a unit out at the best price I can get for it I don't. And I build in concessions immediately, right? Hey, we're going to give you 3 percent immediately, right? 3 percent concession if you use our lender, because we know that if they get you approved, we're going to close, right? I'll give you a thousand more dollars, okay? We, you know, a lot of times we know the appraised value ahead of time, and we disclose that, okay? We don't have an issue with helping them out, raising prices to help them get more of a concession back, okay? You know, we unfortunately just had one that it's going to close in two weeks, but it failed like three days before the last one. So we have that perfect appraisal. We know we were like 12 grand under market value. We know it's going to appraise for a number. We know what it is. So we'll raise that price and I'll give you that additional credit back. You know, If you're really in tune with your business and your market and things like that, it's all going to benefit your client, your buyer, your customer, right? In the end, that's what we're here for.
Mike:Yeah, and what else are you looking at in terms of due diligence besides getting a survey? Besides getting kind of your septic soil test at a time. Are you doing anything else in terms of diligence before you buy that piece of land? Yeah.
Thomas:Yeah, I mean, so I, I have a pencil appraisal done on every lot, right? Hey, we're going to buy this lot. We're going to put down this unit and the appraiser is going to give me a number, right? And does that number make sense? Because we have a due diligence sheet. From the project managers. They're going to tell me how much my septic costs, my well, all my costs are there, plus the lock and everything else. And this is an HGTV, we have to remember there's holding costs, right? We borrow our money, our investors make interest every month, right? They want their money. We're going to factor six months holding in no matter what. And Now, does the numbers make sense, right? You know, we've walked away from, you know, we we've cancelled because it just didn't make sense. The numbers, they, we couldn't make it work, right? And it's, why push a bad project? It doesn't make sense, right? Been past that stage already. Remember in the beginning when you flipped, it was like, oh, but if this happens and If only the cow jumps over the moon right here, we'll be fine. You're never fine. Never ever,
Mike:it's usually worse.
Thomas:Yeah, but you want it so bad. But that's the beginning, right? If I just want it enough, it's like my six year old and the candy. If she just wants it enough, it's going to be fine. No, it's not. Daddy's not going to give it to you anyway. And your flip's going to be bad, right? You're going to make no money for six months or worse, lose. And I've been there. I learned man, numbers matter. So,
Mike:So are you guys exclusively putting down new homes now or do you still rehab some as they come across your plate?
Thomas:The only ones I'm rehabbing are rentals. Okay. You know, I'm still buying rentals. You know, everybody should have rentals. I was not going to say no more. If you're in this business and all you're doing is wholesaling and you're not buying rentals you're 40 year old or 50 year old self is going to kick you. Okay. So I still, that's the only one I'm rehabbing now. Right. We, I think we have three going on. You know,
Mike:And how are you? Cause like one challenge that we've run into at least when we're, you know, rehabbing the mobile homes is it seems like insurance is more and more difficult. Have you guys figured that out?
Thomas:I mean, we have a great insurance lady here in Orlando. Colleen Pacheco. I'm gonna say her name, right? I mean, she is amazing to work with whether it's a flip or a new one. Okay. You're right. Insurance is a pain. This is florida hurricane land. And, you know, they've made it really tough, but she deals with she's actually the new insurance company, you know, I never used her till now for like my home, but this year my insurance doubled, right? It went from 3, 400 to 6, 500. Oh, you need a flood certificate. I live in Claremont, right? Some of the highest parts of Florida. If we flood the world's over, I sent it over to her and it's like 3, 400, right? so now, you know, but I have to have an inspection. They're coming next week, right? When we put down a new home We get, it has to be inspected, right? You know, the day, you know, they come immediately, right? Make sure we're not, this is the home, right? The only thing they don't want to see, we can't skirt it for them ahead of time because we're not allowed to. Hey, can you put the skirting on? No. County will not let us because they want to be able to come out at any time and look underneath our home.
Mike:county won't let you skirt it until the permit is closed. Is that the
Thomas:Yep, until you have your CO. Like, that's the last thing because they want to be able to see underneath what you're doing.
Mike:that makes sense. I never realized that.
Thomas:That was a sticking point with the insurance because they wanted it up, right? They're like, yes, but then you had to have these talks and like educate each other.
Mike:Sure. Yeah. What other things should people keep an eye out for if they're kind of getting into doing mobile homes or putting new ones on.
Thomas:You know, who you work with, right? Check everybody out. You know, I think that, you know, that goes without saying, but I think sometimes we don't, right? We've all made that. Oh man, I met this whatever contractor. He seems great. Yeah. How'd that work? Right. You know, who you work with matters. You know, we don't We buy everything in a trust. God forbid something happens. You can't sue outside the trust. And one property, one trust. I don't care what it is. You know, all our rental portfolio is the same way. One property, one trust. That's it. Right? And then no one knows what you own. You know, so who you work with matters. Research everybody. Okay? And then, check the permits on them, check their reviews, right? I mean, if they told you they've done a hundred of them and you don't see a number of permits, they probably haven't done a hundred of them, right?
Mike:yeah. And to the, on the trust point, are you using land trust or a different type of trust or?
Thomas:Land trust, every one of them, right? So, I mean, it's so simple, and hopefully, listen, I hope in the end, years from now, that I wasted all that money on the land trust every time, because that means I never got sued, right? I, you know, when We have a really good attorney here in Central Florida who just teaches about it. And when I heard it the first time, I was like, oh, that makes sense. Right. And I think I bought one house that's not in a trust. Okay. Just, it's another form of protection. You're going to put insurance on your house when you're flipping it, right? You have to why wouldn't you make sure that if you're buying a property in your LLC? And your LLC owns a lot of other things, and you're the owner, now you're liable for everything, right? Wouldn't that scare you? As soon as you start to collect a few things, it's like, oh, yeah. You know, it's just, it's like asset protection another way, right?
Mike:So is the how do you structure it in that case? Is the LLC is the beneficial interest of the trust or how do you set that up
Thomas:Yeah. Depending on which way we're holding it, right? Is it a flip to get rid of it? Is it a rental? You know, we have a couple of different LLCs we use just depending on where we are, right? So, you know, we have a system for it, but yeah, it's normally the LLC.
Mike:And maybe just for people who just don't know what a land trust is. Can you just give a little bit of background about that?
Thomas:Yeah, so a land trust is, you know, everyone's seen it before. It says, you know, ours are always like one, two, three main street land trusts. Very simple. And you're not the owner. You're just the beneficial interest of the trust. And for us, we use an attorney, okay, right here in Orlando, Joe Siegel. So, if anybody wants to send us a letter, they have to send it to the attorney. Everything has to go through him to get to us. Okay? Whether it's your mail, God forbid you get sued. We get a hundred letters all the time. People wanting to buy our home. I kind of love it, right? I'm like, you know, I'm great, but it's just a layer of protection for everything, right? For in case you get sued, if somebody gets hurt on the job, they can't sue outside of your trust insurance, all your property insurance, right? It's going on right there. So, and isn't that, today we are so, you know, lawsuit happy for anything. One of my neighbors threatened to sue us. Because of the noise we were making during the construction. There's not really a lot of noise. There's not. I'm gonna sue you. Sent the handwritten letter. Guess where they sent it? The attorney's office. Yeah.
Mike:Right. Good. I'll try that one in the blue file.
Thomas:I know what they do is they scan it and send you a copy, right? So, uh,
Mike:Yeah. Yeah.
Thomas:I love mail that way. I wish all my mail could come that way, right? Put in a folder
Mike:Yep. So that makes sense. So every time you buy a property. You put it in one land trust per that property. And then if anything were ever to happen there, then the worst they could do is go after that property, which you obviously have insurance on. It can take all your other, couldn't go after all your other assets.
Thomas:100 percent protection that way. You know, you sleep, right? I mean, if we have 20 projects plus going on man, imagine all those could be opened up if something happened, right? You know, and it's just, so if you're going to back check everybody, you're going to make sure every contractor has their insurance. Have to, they have to have their workman's comp needs to be checked. It needs to be checked every so often. I don't care how long we work with you. Yeah, let me see your card, right? It's not me, like, you know, my, my assistants know Hey, we're gonna check your cards, we're gonna check this we need your insurance policy they understand, right? And, so you're paying a contractor More, who has all these things You're not paying Bob in a truck You're not, sorry, love Bob Bob you'll make more money with But Bob will get you in trouble, yup
Mike:Yeah, sure. Well, especially if you're doing, you know, putting new homes on it, you got to permit and do all
Thomas:Yup, and, you know, one of the things One of the, going back to why we never got a setup company Is We don't pull the permits, right? The setup company, they're the expert, we want them to pull the permits. The septic guy, that's his permit, you know, the AC electric, that's his you know, they're the experts, so we know what we're doing, right? We know the units, we know this, great they're the experts, you let them handle that, right?
Mike:and then when you go to sell them, or are you guys handling that, or you just have a realtor in the area who's. Yeah.
Thomas:an in house brokerage that we work with, so we're, you know, it's just a handoff, right? You want to try to get everything as best you can vertically integrated, right? It just is you know, First of all, it affects your bottom line, and You need to be able to control everything. I'm sorry. It's bad. Oh, it's control. No. Because I'm going to make sure it gets done right. My team's gonna make sure it gets done right. They know. You know, I drive around still like if I'm bored, I'm never bored. But on a Saturday, if I'll just get in my truck and I'll drive and look at 14 projects, right? And the only way they'll know is I'm doing Facebook live videos at those projects, right? You know, what that's taught them is to make sure everything is on point. Because I'll come, right?
Mike:Yeah. Yeah. You'll be swinging by. Cool.
Thomas:Craziest.
Mike:So we're getting close to the end here, but there's always two questions that I like to ask. First is kind of fun, which is what is the craziest or most uncomfortable situation that you have ever experienced in a real estate deal?
Thomas:So we're doing a flip, right? We're finishing. And I bring in a woman who has her cleaning company. And she says hey, I'm going to go over there on this day. She goes over there a day early. The guys weren't finished, but she shows up at like three in the morning. Okay? Takes the paint and paints it in the house. Right. She did not paint good. She did not paint the right colors on the wall because, you know, so we're using agreeable grain, some colors that are similar. And when you open the can, she wasn't, she doesn't know what, right. So it looks like it goes there that she started painting with a brush, not the roller or spray. And then she, was she high? I have no idea. Right. So, imagine my contractor calls me and say, Hey, someone must've came in here and painted the house.
Mike:Yeah, what?
Thomas:I'm like, did they write on the walls? He's like, no they literally painted the grey on the beige wall and the beige on the grey wall because it looks the same in the can. What? I drive down there and I'm like, this is crazy, how the hell? Neighbor says, hey, I seen this woman show up like three in the morning, cause you know, it's that kind of neighborhood. What did she look like? What kind of car? He tells me, I'm like, holy shit, that's the cleaning lady. I send her a text and she admits to it. I'm sorry, I tried cleaning, I mean painting your house. What the hell? Right? I, like that was the, cause my guy calls me and I'm like, What the, what crap is this? Who the hell would break in to paint? Right. And so that would definitely be the craziest, right? That would just, you know, and so I don't know how everybody is familiar with Polk County. Polk County has a you know, a reputation for, you know, some crazy crap, right? I mean, and it used to be like the meth county and it turns out that was the issue here. She just, you know, got a little incentives and energy came at 3 a. m. So, yeah that was probably the craziest
Mike:Yeah that's interesting. Yeah, never had someone break in and and paint my house for me. Wrong color, but right. Second question I always ask for kind of the newer people listening to the show is if you could go back in time and give yourself one piece of advice when you were looking for that first deal, knowing what you know now, what would you tell yourself?
Thomas:You know, I'm a big believer in education, right? No matter what. Wasn't so much in the beginning. I love the phrase learning to swim while learning to swim, right? But you know, educate yourself, go and do it. Don't just educate yourself and sit on it, right? I do not suffer from analysis paralysis. I'm going to learn and we're going to go do and you know, that should be, I think I had an ego about it. Like I was pretty successful in everything I did and this kicked my butt the first year. I mean, it did, right. And I'm going to say like, you know, when I went to go look for help, the lady wasn't easy to on me and that was great. And so educate yourself. You know, if you're going to wholesale, you don't get a mentor, right? Get a coach. If you can't afford a coach, probably can't in the beginning, right? Go to a real learn and then go do right. Because right now in this market, a lot of people who were doing it a year and a half ago, they're not here anymore. You know, and so I'm not saying it's the best time to jump in, but it's probably the great time to learn because, you know, it's gonna, we're gonna come out of it. And, you know, just educate yourself. Continue to educate yourself, right? If you're not learning every day, reading, watching podcasts you're going to fall behind. You just are. If, you know, I remember when the beginning of 23, a guy was telling me, we're going to wholesale till the wheels fall off. And I was like, man, the tires are burning. We're on fire. And like, like the business model is dead. And what do you mean keep doing this till the wheels fall off, right? This is over because the writing was on the wall, it was time to switch, right? You need to be constantly educating yourself to figure this stuff out because, look, we're doing this today. If you told me two years ago this is what I'd be doing, I would have been like no, right? And we're already into developing large tracts of land, right? Never on my plan, okay? But that's what education and getting yourself into mastermind rooms with people. You never want to be that big fish, right? You want to be the little one because, you know, go over there, learn, add value to people, right? Be a value and learn. And you're just gonna it's like osmosis. It's just gonna come through, right? And that's gonna elevate your business so much over time, right? That in the relationships.
Mike:Yeah. Yeah. No, that's a great piece of advice. If people want to reach out to you after the show, Thomas, if they have questions, maybe they need a mobile home installed somewhere in Florida, or maybe they've got some land that they could wholesale to you. How can they go about reaching out to you?
Thomas:They see the stuff there on instagram. We can pop my email in the chat if she could, right? That would be the best way. You know facebook under my name thomas layman, thomas layman rei on instagram as well But you know email is always the best right because it's not just me seeing if somebody responds quicker.
Mike:Yeah. And for the, just for the people who are going to listen to this on audio after you want to just give out your email here. So they have that too.
Thomas:Yeah, it's tom at I will spell it as long s a n d t Santee property solutions. com, you know.
Mike:Yeah. Well, Thomas, awesome. This was great. Thank you very much for being on the show. This is awesome.
Thomas:Oh, man. I appreciate you having me and I had a blast. Thanks again
Mike:Absolutely.