Michael Hamilton – Founder of Live Swell Beach Bungalows in the Kill Devil Hills area of North Carolina, talks to Neil Henderson and Brittany Henderson, the hosts of The Road to Family Freedom podcast. Michael Hamilton, whose book “Vacation Rental Confidential” comes out on July 29th, 2019, discusses how he got involved in real estate and what it takes to run vacation rentals.
Three Key Take Aways from this Episode
- A second home loan works is a lot like a conventional loan because you can put down as little as 10% as a down payment.
- Proper accounting and the cost of property supplies are often overlooked in vacation property expenses.
- Time is our most valuable non-renewable resource.
What you’ll learn about in this episode
- How did a surfer like Michael Hamilton get involved in vacation rental real estate?
- What was Michael’s first real estate deal like?
- How did Michael find his first deal?
- What is the financial model that Michael uses to buy a property?
- What kind of expenses do people typically not think about when they go into vacation rentals?
- What is it like for a vacation rental owner that has not built a system-based business?
- A business is not sustainable if one person always has to be there.
- What does Michael Hamilton’s system look like?
- What is the role of the property inspector?
- How did Michael get educated in real estate investing in the beginning?
- What is the most critical skill for a short-term vacation renter to have?
- How long did it take to acquire his first real estate deal after training with Fortune Builders?
- Michael discusses Visio Lending programs.
- What does a day in the life of a vacation lender look like?
- How does Michael feel about government regulations for vacation rentals?
- Are there any systems Michael uses to help him price?
Help Us Out!
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- Vacation Rental Confidential by Michael Hamilton
- E-Myth: Revisited by Michael Gerber
- E-Myth: Real Estate Investor by Michael Gerber
- Who by Geoff Smart
Resources Mentioned in the Show
Connect with Fernando:
*FTC Disclosure: This post may contain affiliate links. If you make a purchase after clicking on the links, Road to Family Freedom will get a small commission. We are dedicated to finding the coolest products for families looking to building financial freedom through real estate and we never recommend anything that we don’t love.
Lot of the fundamentals are going to be the same. But what we are changing is the revenue model. And so when we looked at our first investment, we said, okay, well, if we can cover all of our expenses from Memorial Day to Labor Day peak season, you know, we’d be off to a good start.Brittany Henderson:
I’m Neil and I’m Brittany,Neil Henderson:
we’re a family on a journey towards financial and location independence. Each week, we interview successful real estate entrepreneurs about their chosen investment strategy, and rated based on how much money it took to get started, how long it took to educate themselves, how passive it is, and whether or not they could do it from anywhere in the world.Brittany Henderson:
Welcome to the road to family freedom. If you like our show, the easiest way for you to give back is to leave us a rating and review on iTunes, head on over to road to family freedom comm slash review for links and instructions on how to do that we would be so grateful. All right, and that’s out of us. Let’s hit the road to family freedom.
Neil Henderson 1:04
Greetings, friends and families. I’m Neil and I’m Brittany, you’re listening to the road to family freedom. Our guest today is just a regular surfer guy who’s built a successful short term rental business under the brand name live swell. With a trio of bungalows situated in the stunning kill devil hills area of North Carolina. He has a new book called vacation rental confidential coming out July 29, which literally the day after we’re recording this interview with Michael Hamilton. Welcome to the road to family freedom.
Michael Hamilton 1:31
Thanks, guys. Thanks for having me.
Neil Henderson 1:32
No, it’s a pleasure. Pleasure. We always like having fellow vacation rental owners on and tell us the quick story about how a surfer found his way into the short term rental business.
Michael Hamilton 1:45uch earlier in my life, about:
Brittany Henderson 4:33
What was that first deal? Like? What What did you guys end up doing?
Michael Hamilton 4:37he first property we acquired:
Neil Henderson 7:08
Gotcha. And you found that one on the MLS?
Michael Hamilton 7:11
Yeah, yeah, that one actually, you know, at the time, I was like I said, I had targeted that Outer Banks market, because there was some real estate price points that seem to make sense. And I’m looking at the numbers. Like I said, conservative real estate investor, so the numbers have to work. And sorry, Neil, what was the specific question I got last night? So no, it’s fine. So you found that first deal on the MLS? Correct? Correct? That’s right.
Neil Henderson 7:37
Okay, so you’re a numbers guy. And real estate investing is very much a numbers game, in, in single in the single family home space, just the regular traditional rentals. You know, it’s a lot of rules of thumb, there’s the 1% rule you where you want 1% of your, you’d prefer to have 1% of your rent equal to one, prefer your rental income to be equal to 1% of the purchase price, you know, you’re typically going to have 50% of your expenses 50% of your rental go to expenses before debt service. What are you know, what are some numbers that you it’s much harder with short term rentals, correct? Yeah. Yeah. So you know, it’s a, it’s a much more fluid target you’re aiming at how do you? What’s the financial model you’re using to evaluate? Now? I’m not talking. I’m talking just to screen a property. You know, I’m expecting you to sit here and give us a graduate level course and short term rental, financial modeling. But you know, what were you What gave you the confidence that this was going to work?
Michael Hamilton 8:41have options on right, doing:Brittany Henderson:
What kind of expenses go into a vacation rental?Neil Henderson:
Maybe the ones that people are the ones that people are typically missing?Michael Hamilton:
Yeah, yeah. So you know, some of those are going to be the ones I was mentioning right there is not having a line item in there for your accounting, right? This is a business that needs to be properly assessed, right with the numbers, the income statement, and the profit loss statement needs to be be dialed in, right now somebody can choose to do that themselves, or they can hire a professional, I’m not an accountant, I’m not a good bean counter. I mean, I can count like that means. But that’s not, that’s not really where I like to focus my time. It’s not what I enjoy. So, you know, we outsource that. And so we pay for that entity setup, we believe in asset protection. So we have entities will cooperate in the state of Nevada, even though that we do business in other states, but those are, those are absolutely things that people just aren’t taking into account, I feel like to on the repairs and maintenance side property supplies, for example, toilet paper, paper towels. So the demands and short term rentals are increasing. And yeah, what we don’t believe in is being part of the commodity stock, vacation rentals, you know, one of my mentors, Seth Godin, not that I know him personally, but he’s, you know, I consume a lot of his content. And I, I love him, he’s one of the marketing kings, and he talks about, you know, there’s a race to the bottom and a lot of industries, and we want to compete on value, we want to compete on service. And so, you know, we make sure that these things are supply that sometimes people might overlook, you know, there I have an ice scoop in the refrigerator, in a little little things like that, you know, to make guest experiences top notch, not feeling like it’s grimy, I think or I think a really, really important. So it’s looking at those things.Brittany Henderson:
Yeah, the little things can be a really big pull, especially at the beginning, when you’re first trying to get like reviews on Airbnb, I know for us, you know, we had pretty low price point, just to get people in there. But I was, I was a stay at home mom at the time. So I was adding a lot of really little personal touches. Some things we can’t do anymore, but having a lot of those little things that people kind of forget about, and then they become super convenient for them and make it easier for them to have a good vacation rental, you know, good vacation experience. I think it’s so valuable because you get that return on your reviews, but then you know, get you more income. And if it’s can be overlooked. If you want to just have this, like set kind of like a bare bones, bottom level rental, you’re not going to get those really great reviews, and then that can hurt your rental ability.Michael Hamilton:
Yeah, well, which I agree 100% because in the beginning, like you’re saying how to get people in you got to build a reputation, the credibility and so what you’re speaking to specifically as welcome GIFs. And yeah, there can be logistical challenges. With welcome gifts. We’ve always had either an inspector or a property managers that we’ve empowered to manage our properties on site. You know, I’m here today in California. It’s the high season in North Carolina, and our business will run seamlessly. And in the beginning, we actually partnered with a local company that makes these kill devil rumbles. The outer Banks’s has a pirate history and rum in the old days used to be called kill devil. And so there’s a distiller there and they make these rumbles and we partner with them and said, We’d love to get these as a welcome gift for our guests. And some guests love them. Some guests didn’t something like chocolate, or they thought there was alcohol in them. So there was those little issues there. But that was a perishable item. And either for our inspector to deliver that after a property was cleaned, or for a property manager to deliver those, there was always a risk of that. So we’ve actually changed from perishable welcome gifts to some of our branded products. And that’s where a lot of my time goes. Now it’s more into the creative projects and like on the real estate of being able to be creative and create more options and have freedom. But we have a beach tote that we we manufactured this year with our brand and our logo and probably forget a beach bag when it comes to beach, they show up. And there’s a very, very nice, beautifully made custom beach bag waiting for them. So you know, there’s that creative side that sets that’s fun as well. But it’s also important to not to get, you know, times are most valuable non renewable resource. So we just got to be cautious as well.Neil Henderson:
Yeah. So you I’ve heard you talk about about building a systems based business. And I’d actually rather than asking you to describe a systems based business with a vacation rental to start, I’d like you like you to start by actually describing a vacation rental owner who has not built a systems based business.Michael Hamilton:
Well, there’s a there’s the person, you know, just like in a traditional rental. And I guess I’ll start this way, I believe there’s a difference between an investor and a landlord. There’s a better way to describe it. Ultimately, I got in this to create freedom. And I’ve been fortunate enough to leave my well paying corporate job, but I was trading time for money. And you know, so people have a choice and start wrong or right. And I never tell anybody what to do. But if somebody says, Hey, I’m going to be the landlord, right, and they’re going to be the one responding to the calls, pulling the potato out of the toilet bowl in the middle of the night. You know, and then maybe come in the next morning at 7am. Because, you know, the person can’t find the internet password, it could become a massive time dump. So, you know, responding to all the guests inquiries, dealing with all the onsite activity, maybe even cleaning, you know, people, sometimes people clean themselves again, that’s not wrong or right. It’s a decision, it’s a choice. It’s a choice that I’ve decided to say, Look, I’m going to outsource this because it’s not the highest and best use of my time. And I’m not the best cleaner. I am OCD about being clean. But I’m definitely not the best cleaner because somebody could come behind me and definitely find something. So I think that’s what it really looks like for somebody that doesn’t have systems as it looks like or maybe even I should say it feels like like an octopus on roller skates. You know, you’re running in a lot of different directions. And that can feel overwhelming in any business, in any business. And I think I saw on your website, guys, and you guys are seems like proponents of Michael Gerber’s e myth. I think I saw that there. And you know I am to that that book is a foundational book that we built our business on, we use the concept that Michael Gerber talks about in there, document everything, build your business as if one day you’re going to sell it, build your business, as if you didn’t have to be there because in order for a business to be sustainable, if one person has to be there, if they’re not there, the wheels fall off that that’s not a sustainable scenario. So we were fortunate enough to be introduced to that early on. And to avoid a probably a lot of those typical hassles that sometimes people maybe that that haven’t been introduced that principle, you know, might might suffer or struggle with for a little while.Brittany Henderson:
Yeah, we were basically in that boat a lot. Because we didn’t know we were new to the short term rental, I mean to real estate in general. So I had a How old was Holden, like six months, six month old, and I was cleaning casita, which was not fun. And we eventually did find a cleaner that helped for a while and stuff. And now we do have a lot of those systems in place. So what for you? What does a system look like for your short term rentals?Michael Hamilton:
Yeah, and I’m glad that you mentioned that because look, in the beginning, I’m not immune. So sit here and say I’m above cleaning would be, I’d be lying. And I don’t do that. So in the beginning, I did clean the property. And here’s why it wasn’t because I thought it was saving money. It was because I said to myself, I want a specific results. We had hired a cleaning company that we didn’t give a system to. And you know, what we found was some of the reviews said, Oh, you know, are you guys getting your money’s worth, from your cleaner, or I found this. And so I said to ourselves, Well, look, you know, we’re going to need a little bit more control over this scenario. So let’s do some cleans. Let’s document every single thing that we’re doing. And that’s down to the little whiteboard on the refrigerator that says, welcome them to the bungalow and OBX, Mike Murray and Cooper, right that, you know, they’re responsible for that the inspectors responsible for inspecting the property has a checklist to inspect the property, but they also bring some of the experience items like that tote bag with each tote bag that I was telling you. So how do we develop a system, we find a recipe that works, and then we document it. And so we clean the house, and we make sure we document every single thing that we’re doing and becomes a checklist. And that checklist is really, really good, because now it allows you to have a level of accountability to with people things are black and white, if we want every one of our people that we bring on to be successful. I’m however, like I said, I’m not perfect, I still make mistakes to what that system will allow us to do is say, Okay, well, you know, the inspector found a lot of sand on the floor. Okay, great. So, you know, we might just reach out to the cleaner and say, you know, you know what’s going on? Or, you know, we’ve got to make sure this is improved for next time. And so, yeah, it just it reproducible systems allow for predictable results. And you know, when you look at franchises like Taco Bell, McDonald’s, things like that, that’s why people buy them, they’re buying them, because they’ve done the legwork. They’ve done the analysis, they’ve done the hard work of building, you know, a system that that works.Brittany Henderson:
Yeah, I’m curious. So you have a cleaner, and then you have someone else that comes back through that. Make sure that everything’s good to go actions.Michael Hamilton:
Yeah. Okay, so part of that inspectors role. And we didn’t always have this. So this is an evolution. Definitely an evolution then definitely wasn’t the first couple of years, we had Property Inspections. But I like to I like to model success. And good friend of mine in San Diego, who now actually lives in the Outer Banks, worked for a vacation rental management company here in San Diego, which is clearly another very popular vacation rental area. And he was doing inspections for that company on very, very high end, multiple million dollar front properties. And so I said, Christian, I said, Tell me a little bit about more what you’re doing over there. And it’s like, yeah, you know, I go in after this. And I have this via three different types of inspections on arrival inspection, a quick busy turn inspection. And then after the cleaner had had checked out, and so fortunately, was able to, you know, give me enough insight and idea, and then, you know, I took the idea and said, Okay, well, we’re going to make sure that we’re not the cheapest in our marketplace, we have a lot of responsibility to make sure we deliver on the promise to our guests that they’re, you know, cleanliness isn’t intolerable, in my mind. And so I said, This year, we’re going to put in place an inspector, and it’s not that we want to beat up a cleaner, that’s not the point of it, it’s to help the cleaner, it’s to help the cleaner and and point out, okay, look, if I went through, okay, this, this just needs to be addressed. Or it can also save us to like, for example, we’re pet friendly, that’s another way to increase your revenue in the vacation rental space, but it also becomes more work. So we’re able to compensate our cleaners more. But there can be, you know, more troublesome areas, sometimes in the sectional couches behind the Ottoman is it is a trouble area where some general accumulate, so the inspector knows to check those under certain things they know to check. And then that way, when the guest arrives, we can avoid risk in any business, but we can strategically reduce it. And that’s where our intention is. Gotcha.Neil Henderson:
Is that inspector paid on a per inspection basis? Or do you have them sort of under contract?Michael Hamilton:
Yeah, I haven’t under a contract where there’s a certain amount that they get paid per month per property. And I’m a big believer in know, incentivizing people with bonuses. And hiring is extremely important. And the hiring is not created equal. A great book is by Jeff smart, called who, so we model different hiring systems in our business. And we try to look at people with their personalities alive, you know, we don’t really look at their capabilities and the raw talent, you know, can they execute the job, but they fit our core values, right, or, you know, they have a passion for the brand, they’re going to enjoy the ride some of these other things, so, yeah.Neil Henderson:
So let’s go back a little bit to the beginning. You, I know that you went through Fortune Builders mentoring program? And is that mainly how you got yourself educated with real estate and beginning?Michael Hamilton:
Yeah, yeah, I mean, specific to real estate investing. I, yeah, fortunes builders has been a been a close part of my investing career for for a while, I’m not as engaged with that community anymore. But I had a lot of a lot of relationships, and people that that continue to push me. So in terms of real estate specifically, definitely Fortune Builders was my primary education resource. But I don’t discount traditional education too. Because there are some other skills that are important as well. There’s raw business, strategy, technique, all that stuff. But communication, extremely important. Problem Solving is extremely important. You know, one of the things that I’ve learned a lot about to over the over the years, and I love that this podcast is called the road to family freedom. Somebody shared with me, they said, The road to financial freedom is paved with personal development. So there’s a lot of skill sets that go into real estate investing, that are just not raw talent skills, those are absolutely essential and necessary. But there’s a lot of other ones too, that I think are going to be important,Neil Henderson:
will need mention skill, what do you think, is one of the most critical skills for a real estate investor, specifically short term rentalMichael Hamilton:
investor to have? Right, so I mean, I’ll ping off of that quote that I just gave you. And I’ll say it again. So the friend of mine share this instead of the road to financial freedom is paid for personal development. And Tony Robbins talks a lot a lot about the ability to control emotional state. Well, in business and real estate, there’s a lot of emotion, that can be a lot of money, you know, you’re working with people, different things can come up. So it’s, it’s really important as a business leader to be able to temper yourself and control your emotional, emotional state. And that’s something that I’m still getting better at. And I’m still learning as I go through the journey I grew up in, in the northeast, Long Island, New York, and it’s a different place, people a little angry or over there. If I needed to go to California and mellow out a little bit, so that that’s definitely one of them in terms of like, what skill sets are important, we’ve hit one of them so far hiring, I mean, you can achieve a lot as an individual, but if somebody really wants to be significant, they’re gonna have to work with people. And you’re only going to be as good as the people in your business, specifically to short term rentals. But any business, right, I mean, customer service. Customer service is something that I observe it all the time, because I’m just thinking about it. And so I go into, you know, some places I’m just appalled at the level of customer service. And then you go into a chick fil a, and you’re like, how are these guys? it? I mean, I don’t know if you guys have chick fil a and in Vegas, but like a chick fil a, sometimes I feel like, I’m treated better than a five star Steakhouse. And they have the same labor pool as McDonald’s as everybody else. So why why are there people just have a higher customer service aptitude, then than others, financing basics are going to be essential, right, learning how to buy real estate, so so your basic real estate investing education. And the skill that I would say to that maybe was the hardest for me, is learning how the wealthy and entrepreneurs think I grew up in a family. That was hard working, middle class family. And my parents had civil servant jobs. They didn’t have an entrepreneurship education, they didn’t necessarily have an investing, education. So a lot of what I was taught came from, from that kind of a world. And again, there’s nothing wrong with that world. But I wanted a different result. And so there was some different concepts, some different things that I had to learn about how to learn that, you know, time was early, non renewable resource, you know, and knowing that fact, how do you how do you structure yourself? Do you do everything? are you saving money? Because you’re cleaning the house? Or actually, is that costing you money? Because it’s not the highest and best use of your time? You know, I think an important one, or one that a lot of people can relate to is debt. My I grew up, you know, hey, credit cards are bad, all debts bad? Well, maybe it depends, depends on the person. debt is like fire and water. You know, it can accelerate things, but it can also be detrimental things, if it’s not used wisely. So really understanding how the wealthy and entrepreneurs think and, you know, Fortune Builders helped me a lot with with those things.Neil Henderson:
coaching, how long after you finished training with Fortune Builders before you acquired your first piece of real estate?Michael Hamilton:
I actually had acquired my first piece of real estate when I had, it was within six months of being in our community. Yeah, do I ever did the nice thing about that community as a community of real estate investors, I got introduced to some people and I was looking at passive income. And so my first ever investment, I purchased a couple mobile homes from another investor that acquired a park on an owner finance deal needed some improvements. And so the the deal was was, it was like eight k for her double y, and cash flow on it was like $500 a month or something in that in that range, after the lot rent and stuff like that. And I just come out of graduate school, I didn’t have a lot of money, I had debt. And people showed me Hey, look, you have to be wise using debt, right? We’re never going to teach anybody to use debt to finance Christmas. Right? We’re going to teach them to use debt to buy income producing assets or increase their human capital. Right, what their what their potential is. And soNeil Henderson:
yeah, we’re there any challenges that you think held you back early on from the that first deal?Michael Hamilton:
Well, I mean, there’s something I think fear is natural, in any worthy endeavor, things, things can hold you back, I was a little more fearful, I think, in my first flip, you know that that seemed a little bit more foreign money was raised from private investors. were hiring people for the first time, you know, at this time I was I was working with a business partner, when I did flips. We were hiring people. So we’re getting an introduction to that. Which is, which is, you know, you’re not always going to get the right person, you know, the first time but again, there are things that you can do to lower your risk. So yeah, I think you’re going to struggle with fear and getting the right people on your team and just learning that I think it’s critical.Neil Henderson:
So I want to dig in a little bit to the financing. You talked about a second home loan? And can you talk a little bit more about the restrictions on that? And, you know, are there any sort of copy that goes along with getting those kinds of loans?Michael Hamilton:
Yeah, so I’m not a mortgage broker. So I don’t want to speak to all the specific financing, we will, we will hold you to it, don’t hold me to it. Now, you know, my understanding of a second home loan is has to be in a location that you’re not in. So at that time, I was living in California. And so I was eligible for my primary residence, California, I was eligible to have a second home there. And the second home loan is treated a lot like an individual’s primary home loan input less than 20% down and I think even put less than 10% down, I decided to put 10% down that’s that’s kind of where I felt comfortable with it. The interesting thing about short term rentals is the landscape is is changing a lot. And it’s starting to look a lot more like commercial real estate assets, where banks are starting to look at these opportunities as asset based loans as opposed to credit based loans. For example, one of the bigger companies that pie a lot of people on this call have heard of or no Quicken Loans. And I can’t say that I participated in this, but it is something that I’m considering they’ve allowed people to refinance, and also use validated income statements from Airbnb home away, vacation rental by owner to refinance their properties, I think that’s a fantastic evolution of the lending space in the right direction. because traditionally, Vacation Rentals in the past retreated exactly like investment property loans. And if your income wasn’t sufficient enough to support it, then unfortunately, they couldn’t, couldn’t write your loans. Another lender that I’ve recently bumped into, that I’ve had conversations with, and I can’t speak to actually engaging in their product, but I very interested in their product, because I’m considering them, considering I am doing a round of acquisitions here in the fall. And we believe this could be a really great product for it. So it’s a completely asset based product, we’ll look at somebody’s credit score. But what they’re not looking at is their debt to income, they’re not looking at tax returns, they’re looking at, they have a higher downpayment requirements, so they’re going to reduce their risk that way, 25%, but they will land on short term rental properties on 30 year terms, right, great amortization type scenarios, you know, without all of the typical hassles that people have had to deal with, with traditional rental properties. And getting to that point, maybe before they’ve established a relationship where they have a commercial lender and a bank that can look beyond their credit and income scenario.Neil Henderson:
Gotcha. So did you mention the name of that company?Michael Hamilton:
Vizio lending is the name of that company? Vizio?Neil Henderson:
Gotcha. So you know, one of the challenges with one of the biggest wealth builders and real estate is the burn method, you know, being able to buy rehab, rent, refinance, and repeat. And one of the challenges with short term rentals, often you have not been able to do that, because the banks, they look at it, and they go, well, it’s not official, you know, where’s the where’s the income, the end comes to varied? We don’t like to do that. So what you’re saying now is that some of these lenders will now basically allow you to do that.Michael Hamilton:
Yeah, yeah, they want the validated statements. So for Quicken, they don’t have if I don’t believe they have a purchase program. But they have a Refinance Program, right. So you can get your capital out to make further purchases, the Vizio lending does have a purchase program. Gotcha. And so the way that they do it, I guess, the piece, the piece that might be missing there is. So let’s say it’s a new purchase, right? There’s no income history of the property. They have some algorithm or some database that they’re going to look at particular to the market size of the property, and they are going to come up with an estimate of what they believe that the property can produce in terms of revenue. And just like commercial real estate, they’re using the debt service coverage ratio, to make sure okay, is the amount of income coming in going to be sufficient enough to cover the debt on the carpet?Neil Henderson:
Okay, so let’s dig, I want to dig a little bit more into time. We’ve talked about systems based things like that, but what what does the day in the life of a short term rental investor, like yourself look like?Michael Hamilton:ht now. properties are almost:Neil Henderson:
perfect is the enemy of done. Yeah,Michael Hamilton:
Is infuriating, I’m sure though,Michael Hamilton:
what was I gotta say, I actually saw something on your Instagram account, there was a hashtag that you guys put there. It said something about experience over stuff or experiences. And that’s another creative thing that we want to work on to is you know, falling you know, modeling success. We believe in modeling success. It’s one of the principles we subscribe to, you know, if you look at what Airbnb is doing is the disruptive piece in the short term rental space over the past 10 years, or even less and less even sure at this point. But uh, you know, they don’t only have a combination or stains, they have experiences and you know, we feel like we can grow into that too. And we have a lot of branded products on site we, one of our guests came from Polk acid, Rhode Island, to Brandis soap, she left three of these large soaps at our place. And later, our property manager gave them to us because they were they were left for us. And she came to us and we reached out to girls name is Stephanie Brandt said, Hey, Stephanie, we’d like to see if you’d be open to co branding. One is natural organic soap. So we can leave our places will co brand them. So both of our labels have be on there. So we’re looking at looking at more stuff like that. So we can put ourselves in position really to pour gasoline on the fire. I don’t know if you listen to Tim Ferriss podcast at all, Tim Ferriss is one that I listened to a lot. And we’ve resisted the temptation to grow in terms of number of units over the past couple years, because we really wanted to focus on when you’re smaller, right? You can talk more to your customers, things like that. But you could also perfect your process. And then once the process is solid, then and for a little more gasoline on the fire. That’s cool.Neil Henderson:
That’s great point. So talk to us a little bit about that. The sort of the branding that you’re doing with the with the beach, with the beach bags, and things like that. But is it something that though the items that you’re selling to the customers there while they’re on your on site? Or is it stuff that they can then buy later on?Michael Hamilton:
Yeah, so that’s that’s the end goal. We haven’t opened that up yet. But currently, NW and right now on our site, there’s something called shop. So yeah, there’s there’s been a lot of different things from you know, the tote bags, could be one of the best sellers. We go anywhere. It’s going to be mugs, the soaps are important with the package. I’m, I’m a big, you know, why do we you know, live swell as well as because the mission of it is to open the doors, laid back surf lifestyle, and you know, as you can see, I’m just the surf guy, right at the end of the day. So I take a lot of trips, I mean, the Traveling is natural in that space, because you want to go to different places. And Bali, Indonesia happens to be one of my favorite places. And I was there this time last year for about a month with Maria, my girlfriend and business partner and we actually had some goals there to to work with some manufacturers and get some products, which we didn’t realize that we didn’t have enough time at the time that we really committed to it. So it was interesting that we just bumped into somebody that in Bali, there’s everybody watches the sunset and has a beer, this one beach to the Beach Boys faces the sunset. There’s these really cool beanbag chairs and they’re so comfortable, and they’re everywhere. And so we just happened to find a vendor. And we got a bunch of them custom designed with our logos, we only had like five days left. So I had to put pressure on I got them done like two days, which she complied with you until you get them done. And you know, we came back with these we put you know, we have patches, we can label things. We have hats and all these different things so we can label them. And you know, this year we I mean, we’ve had requests to buy them we actually sold one was our last one we had about 10 of them was a little resistant of it because we have to work on getting more but one of our guests came from Maine. She was so stoked. It was her son’s birthday coming up. She’s like, I really want one of these beanbag chairs. And I was like, Oh, let me see if I can find one. And then I saw there was really really special for her. And, you know, we were like, okay, cool, like, my dog choose them every once a while while I’m there. So and we gotta we gotta be careful about replacement. But and that’s history. He’s a puppy. Yes, dogs have achieved anything. My daughter’s everything.Brittany Henderson:
What kind of dog do you have? I’veMichael Hamilton:
got a black lab puppy, and she’s gonna be a year olds next month. SoNeil Henderson:
puppy black labs are puppies until they’re like seven.Michael Hamilton:
So they say so I got my hands full. So yeah, just just create a product like that. And you know, ultimately, in this is not an original idea that I’m having here. There’s other Airbnb is that are set up as almost concepts, shops, where basically, it’s a demo room where people can try things. We have a relationship. Now with a company called home reserve, they make modular sectional couches that are pet friendly fabrics. They’re fantastic for small spaces, you can build a mini space, and you don’t have to go crazy about somebody stealing on it. We have you know, I’m a sucker for fans. I used to fly a lot on airplanes. And I think you know, some of the marketing and the the airline magazines committed by the big ass fan. So we have a couple of those in our places. And you know, people like him. And so some of those things as well. People ask us about mattresses. And so I think just making things available right now, these are all the products that we use in our in our property. Like, there you go,Brittany Henderson:
yeah, you can sell them where I mean, even if you do have just an affiliate link on your site that could still bring in a little bit of revenue until you have the ability to actually sell it to them.Neil Henderson:
Sure. Well, and it’s an interesting concept. In one of our previous interviews with john McIntyre, I think in like Episode Four, she talked about the idea of one of the she’s a short term rental operator as well. And she says one of the wonderful things about it is that you’re sort of getting guests and opportunities to sort of try on a space. And it’s one of things I love about short term rentals over hotels is that you can really sort of go try on community, and we get it with guests all the time that are just, you know, they want to they want to come stay in the community and see whether or not it’s something they want to do long term. But there’s also the idea of trying on a space and seeing, you know, a really designed space and going yeah, we can like this. Sure.Michael Hamilton:
I agree. I couldn’t agree more. And it’s a it’s another avenue to be creative.Neil Henderson:
So one of the biggest challenges right now with short term rentals is that it’s becoming so prevalent that governments government regulation is becoming a bit of a challenge. Are there any ways that you’re sort of trying to hedge your bets, protect yourself against that?Michael Hamilton:
Absolutely. It’s a really good question. I’m glad you brought it up. First thing that I’d say to that to that is that I am in supportive regulation. For the short term rental industry, right now I’m in San Diego and there’s a big push against so you could walk down here and you’ll see bandit signs that say neighborhoods are for neighbors, not vacation rentals, or you’ll see a sign that says like Vacation Rentals destroy neighborhoods I it’s it’s it’s it’s that aggressive. So the way that I’ve had that is the assets that I own are in the Outer Banks of North Carolina. And that has been a vacation rental community before all of us even existed. That’s how they create a most of their revenue. And so where I think people need to be careful, is what’s changed. And I was mentioning there’s this change with Airbnb popped up while Airbnb has facilitated, I believe what’s called the rise of the urban, short term rental. So vacation established vacation communities, right? have been operating for a while the mindset, the worldview of the neighbors, the people, they’re used to it, they’re accustomed to it in a high rise apartment building in a city that has only had long term primary residence or long term renters. You know, they might feel that revolving door syndrome, and they might feel some of these emotions and, and I can I can empathize with that. So my hedge is that for vacation rentals, I’m only going to purchase an established vacation or communities that have existed before Airbnb, you know, and that in that are clearly showing the openness. And there was a last year, two years ago, San Diego passed a referendum that, and I don’t know exactly where it is right now, the legislation, but they passed something that said, in San Diego, you can only rent your primary residence, six months a year of the short term rental. And then the lobby of the vacation rental industry and all those people that were kind of sitting back, you know, just kind of cruising, not thinking that anything was going to pop up and they took action. And I even believe Airbnb was suing the city of you know, different cities for for different things. So there’s a lot of legal battle going on about that. I think sometimes things are transition when something’s new as well. And you see this with Uber, right, you have the taxi lobby fighting back, because it’s encroaching on our space and their opportunity. And that’s only natural. But what I believe is that people are demanding short term rentals, there’s a lot more value, there’s a lot more space, a lot more amenities, it’s just a host of more value that can come out of it. And with regulation, I believe that more areas will be able to be able to entertain short term rental sustainable,Neil Henderson:
well, it’s the vacation rentals have been around for years, they’ve been around forever. And part of the reason I think it’s become an issue is that Airbnb has made it so easy, there’s a lot more operators entering this entering the space, there’s a lot more operators that are not posting responsibly, in my opinion. And that’s really what gets down to the heart of it here in Las Vegas, they’re very hostile to short term rentals, primarily because they’d have a five bedroom mansion in a nice neighborhood. And sigma new from USC would come to town and rent it for the weekend. And, and there’s 20 cars 20 cars parked on the on the street, and there’s 40 guys stay in there and they’re partying all night, and there’s unsavory things happening in the you know, I wouldn’t want that I wouldn’t want to be next door to that either. I understand it. But I do agree that there needs to be a space for it to happen, I think it’s better to allow it to happen and regulated than then then to just not allow at all,Brittany Henderson:
we actually here in Las Vegas area. The You know, there’s in Las Vegas, there’s a lot of issues with it. But Henderson which is right nearby has just taken on the basically said, we’re going to do it and and we’re going to regulate we’re going to we’re going to regulate it, but they’re going to get all that income stream that now Las Vegas is going to miss out on because you know they won’t, they’re not going to take like they’re not getting the business license, you know, revenue in the taxes and all these different things because they don’t want it at all, rather than figuring out how to regulate it in a way that makes sense. I mean, this is a vacation destination, it’s maybe not as similar to like a beach town or something like that. But we have a university here we have the strip, which personally I would not stay on the strip if I didn’t have to, because of the way that I like to stay, you know, I want to be able to cook but also I have a really hard time with cigarette smoke and things like that. So I’m one of those people that for me, it’s much more comfortable, and gives me a lot more flexibility to be in a vacation rental versus a hotel where you know, you said you you kind of get trapped, you feel like you’re trapped in a box or you don’t have that flexibility. So I think Las Vegas is kind of missing out on, on something that could be good for them. But I’m sure the lobbies there, you know, for the hotel and stuff have a lot to do with that. And then we have some big proponents that are in the government system, but don’t want them in their personal neighborhoods, I’m not sure that they necessarily care about anything else, but it’s affecting them personally. So they’re there pushing, but Henderson has taken this opportunity, and now they’re going to have this income stream that is going to be you know, probably a big boon for them.Michael Hamilton:
Yeah, it’s the future is exciting, right? And, you know, something new and sure not everybody’s going to be open to it immediately. And that’s, that’s fine. I agree with every one of those points. And I don’t want the 24 sigma new guys. Party next to me. Yeah, either. Well, I’m trying to sleep, you know, actually make a product for that. It’s called noise aware. Yeah, I don’t use that in any of my rentals. But, you know, it’s become such a big fear of the vacation rental owners. Like, I gotta check my number of devices. But um, yeah, I mean, in hosting as many people as we have, you know, I’m grateful. I’m not immune. I think one of the things that helps reduce against maybe some of the debauchery that could possibly happen, and again, we’re not immune in the Outer Banks, people go there they go to the beach or go on a party they’re going to have fun, is price point. So you know, on average, we’re anywhere between 62 $100 on average above our market averages. average daily rate. Yeah.Brittany Henderson:
And prices out those Yes, young hooligans?Neil Henderson:
Are there any systems that you use to help you do price prediction? I mean, Airbnb is very notorious for they’ve got their, their pricing system, but it’s basically just a race to the bottom, mostly on that. Are there any systems that you use to help you help you price?Michael Hamilton:
I can’t say that I found a pricing system that I trust yet. And the reason being is that I just haven’t been convinced that a an algorithm is going to know a market better than I know it. So I have a system that I built, right where we set up our pricing at the beginning of the year. And most of you know, the high season stuffs going to all all be booked out. We don’t really even know what a an offseason feels like anymore, because our places pretty much booked every week at you know, every single day. But every week, the weekends usually get chewed up. And you know, this is a this is a vacation to the beach vacation town. And sometimes sometimes not all the time does get snow. So I haven’t yet use the tool I do and I am a big fan of automation on the guest communications, would you use a product called Smart VNB that did just build into their software, a pricing tool. And so I’m kind of tempted to at least take a look at it. We set up our pricing the beginning of the year. And then either Maria or myself, like every month, we just look at what’s two months in advance what you know, what looks what looks like, it’s I know, we’ll take a look at the price tips. But we’re not going to be beholding to the price steps because sometimes I’ll go below the price that because I’d be like that’s not a that’s not a desirable time. Yeah. So to make sure we get the booking, you know, it’s still maybe $250 a night, whatever it is. could make sense.Brittany Henderson:
Yeah, I think it’s good to keep an eye on that I know, for us, you you probably have a different kind of your seasonal stuff is really big for us, we have a certain number of like events that are really hard to keep track of because, you know, there’s so many conventions and things like that. And we actually, you know, for a couple of years, we kept missing Electric Daisy, was that like a fest? Whatever it is, its massive. festival. Yeah. And we kept missing it not really, you know, it would get ahead. And it would open up before we went, you know, because we book I think like six months out or something. And so it would open up and then we wouldn’t realize that it was that weekend and it would be priced way too low and someone would nap it up and really bomber. So now we have we do use a pricing service that helps, because it can it tracks some of those better than we can keep our eye on it. I think if we were doing this more full time, we could probably do more like what you’re doing. But dress right now. We have to offload that sure has mostly because it just makes it easier for us to have lives. AndMichael Hamilton:
yeah, I mean, you definitely don’t want to be you know, having to go into a pricing calendar all the time. That’s a time dumb for sure. Yeah, I can respect it. And I understand it.Brittany Henderson:
So I’m curious, I know that you said you have a girlfriend and I don’t know if you have any kids or anything. But do you have any advice that you think might be helpful for someone that’s looking at getting into this space that has a family and might have a full time job, I know you can speak to the the job piece. So if you if you don’t have the family peace, that’s fine. But you know, someone who has a limited time, limited time on their hands? What What should they know, before getting into this?Michael Hamilton:
Yeah, so let me think about that. So this is a family that’s remote from a vacation rental destination, probably desires, a desire is one of these properties. And this is a dream, this is a dream for for many people, right. And I think it’s important to, you know, dream is important enough for a family to go after it. And I think what’s important to is understand that whatever we’re investing or wherever we’re an entrepreneur, you’re always going to experience a lack of something, right? We’re always going to experience a lack of something a lack of time, maybe in this case, or, but that’s, that’s, that’s what entrepreneurs investors, you know, ultimately, you know, gotta gotta make some decisions and say, hey, look at my, am I gonna be resourceful and and figure this out? Or am I gonna let that get in the way of, you know, an opportunity that I might want to pursue, we see a lot of families come out, a lot of most of our guests are our smaller active families. And a lot of them have expressed interest in, in purchasing. And, you know, there’s the fear of the distance, there’s definitely that fear of the distance. It’s, you know, fear really comes down to, you know, a couple things, there’s, you know, at least the way that I’ve been taught about anyone could be wrong, as fear is a lack of certainty. And it’s a feeling of being alone. So I think apply it to this example. Maybe they might feel alone or with a property, there’s some combination of that. Well, what can they should, you know, they got to ask themselves, what can they strategically do? To not to not have that feeling of being alone, right? I mean, there are property management companies that you can completely outsource 100% of your property to now, there’s a cost to that, you’re going to give up, probably most of your cash flow. But if you buy right to I mean, there’s there’s two ways you’re making money here, either on cash flow, or you’re you bought right, and you’re making money on equity. So also depends on what your goal is to I mean, I’m looking at cash flow and equity. So I would say, you know, find find somebody or something that’s going to help reduce that. And so you’re not alone. The second part is going to be how do you reduce the lack of certainty? Right. And so the opposite that it’s confidence, having more confidence? You know, what, I would ask them the same question, what what what could they strategically do now, to feel more confident about pursuing that opportunity, and new confidence comes down to education level, but it doesn’t only have to be somebody that just you know, that individuals education level, because it might take a lot of time? frustrating, but how do you leverage somebody’s education? You know, and things like that. So I think investing groups are important things of that nature. But all these things are going to be out there for sure. The other thing I would say to there’s a great, there’s a great quote by Brendan Bouchard. And I don’t know if this is applicable or not, but he says fear and faith ultimately, you believe in something you cannot see. You choose. So, you know, from my mind, there’s always going to be something coming from my very more tempered now, but my shorter New York mindset, it’s and how we can buddy of mine cases of real estate investor, and he’s a little cantankerous, and he says, like, you make excuses or you make money, but you can’t do both. Yeah, you know, so at the end of the day, we can we can fall victim to self sabotage, or we can figure out a way to make something happen. That’s, that’s what I truly believe it’s not going to be easy. Things might not be easy, but it could be worth it. Right? If it if it’s what you really desire and what you want, right? I mean, imagine, you know, families. I mean, that’s part of why I got into it, I don’t have the family yet to answer your question. Specifically, I have the dog that’s the type started teasing me in. So you know, I’m looking at it as a lot of this is an opportunity for me to get my time back. So I could spend more time with my kids in the future. And this is something that I could leave to my favorite people, whether or not they want to sell it, you know, I mean, you know, sell it, you know, if they don’t want it, but they could they could have, you know, a cat, you know, a very strong cash flowing scenario, I mean, for my own retirement, cash flow based retirement plan. So those are really, really powerful and important things. And I try not to let the little things get in front of it. And I understand them, I respect them. But we gotta we gotta push past things to to achieve things toNeil Henderson:
give another question.Brittany Henderson:
Okay. Well, Michael, thank you so much for sharing us with us today. You’ve got the book coming out. Where can people pick that up?Michael Hamilton:
Yes, it’s going to be available on all the major outlets, your Amazon’s that’s, that’s where I would say it is easiest thing. But all major distribution outlets, vacation rental confidential will be available. That’s awesome.Neil Henderson:
And if any of our guests want to find you, what’s the best way that they can reach out to you?Michael Hamilton:
Yeah, yeah, I’m, I will give out my email address. I can’t promise that on the fastest to, to respond. But, you know, we are doing some more acquisitions, things like that as time moves forward, like I said, to even starting to venture into the commercial space. One other way to that Maria, and I like yourselves have thought about, hey, how can we contribute and get back to nothing is our main focus, but we are, we are doing some video series, we just finished one called the get more booking series, and we put it on YouTube. And it’s probably a disaster, but it’s done. And it’s better than perfect. So you can put my email address in in the show notes there, just Mike. And then at live dash swell.com. And if people are in the vacation rental space, we list all the tools and resources that we use. We have a vacation rental resources page. It’s just live swell, slash vacation rental resources.Neil Henderson:
Cool. Thank you so much for being part of our show today. And we look forward to meeting you someday. Well, we love North Carolina. And we also love San Diego, we usually come down there every Thanksgiving. SoMichael Hamilton:
we’re gonna we’re gonna have to see you guys see you guys at one of these coastal destinations. Or maybe when I get the gambling bug, I’ll see you guys are awesome. All right. Well have a good one. Thanks. Thank you.Brittany Henderson:
Well, that was Michael Hamilton, it was so nice to have him on. I thought there was a lot of really great information there. So what was your key lesson or most interesting takeaway,Neil Henderson:
I would say sort of a mindset thing where Michael talked about the fear of getting started for a lot of a lot of new investors face. And some of the ways that you one of the reasons that you have that feeling is one have a feeling of being alone, you’re in this all by yourself. And also the idea of not feeling like you have the competency. And I know exactly what he’s talking about that sort of experience. And, you know, a lot of times a new investor really just wants someone on that first deal to kind of hold their hand a little bit. Yeah. You know, it’s why a lot of people go with turnkey, maybe start off with term keys, which I don’t think it’s such a great idea. But it’s, it’s a way to maybe get over that first deal syndrome. And also the idea of not feeling competent, and it makes you feel like all those unknowns that you don’t know are going to overwhelm you and you’re gonna lose money and things like that. So that was that was a big one for me.Brittany Henderson:
Yeah, yeah, that was interesting. And there’s a lot of ways that you can sort of combat that mean partners, but also the education piece, or what is he talked about? He didn’t really mention a lot of like specifics there. But I think the education sort of really makes a difference.Neil Henderson:
In his case, he specifically got educated by Fortune Builders. Yeah. Which is very well known. Real Estate mentoring organization. I don’t have any experience with it. Myself. It’s a no, it is fairly, it can be fairly pricey. And, you know, Mike, Michael admitted that, you know, he I’ve heard him talk that he’s spent his spent hundreds of thousands of dollars on real estate mentorship, soBrittany Henderson:
yes, not only he did, I think he did also mentioned sort of groups and things. So meetups and and investor groups, things like that. So there’s a lot of ways to get over that feeling of fear or loneliness, even if it’s just a book that helps guide you or a group that’s backing you up that that people are saying, You got this.Neil Henderson:
Well, and one, the one one last thing we move on, is that one of the things that I love about real estate investing is that it’s, it’s easy to replicate, you don’t have to reinvent the wheel, you know, you’re not an entrepreneur who’s creating a new product. It’s a product that has been around for years, and there’s plenty of people who’ve developed the systems and, you know, rules of thumb they want to follow. So yeah. How What about for you? What about,Brittany Henderson:
I mean, I don’t know, if it’s necessarily a key lesson, or just something that I found incredibly interesting, I really liked hearing about sort of the details, piece. So just some of the small things that they do to like, elevate their properties, because, you know, he, he mentioned that they’re not going for that bottom of the market price. They’re presenting themselves as sort of a premium, fancy, I don’t know, not really fancy, but it’s, it’s a destination, it’s not just like, a basic place to stay. So their price point matches that and then but they also provide amenities that match that. And then along with that, I found it interesting that not only are they doing that, but they’re taking that and then sort of expanding it to really create a brand. So the the lives well, brand, you know, it’s already sort of their within how they present their vacation rentals, but they’re making it they’re monetizing it and creating ways to have even more income streams, which, as we, you know, have talked about before is it’s good, it gives you some backup it you know, it provides a little bit here and there, and can increase cash flow, but I just found it incredibly interesting, because that, for me, is something that I felt like I could get into that, you know, like I love the real estate piece. And I think it’s important and, you know, obviously I like participating and being a part of this team. And also that creative piece is probably more my region where my jam or my where my like area of expertise or not really expertise, but just where I would Excel more I’m not in the like, the numbers piece, obviously. So anyway, I just found it really interesting to kind of talk about that and think about oh, you know, is there something else that we could be doing in you know, our rental that might be useful even as not as necessarily another income stream. But maybe I mean, we have a dog walker, that I have some cards in there for maybe, you know, we could have more of a, you know, display for her information and maybe put it even in the rental information, and then you know, possibly get some referral fee or something like that, or, you know, if there’s a local soap company or whatever, you know that I found that interesting. And even if it’s something we don’t use, it’s something to think about, you know, we, when we first started, we don’t do this anymore, just because it’s kind of a panic button, I don’t know that it’s really necessary, or people don’t really care that much police to put a couple beers in the fridge, you know, and do some little small things. And we could probably bring some of those things back. We do have dog treats and like poop bags and stuff in there that, you know, are still things that are helpful because you know, you forget like your your doggie bags, like that sucks. I mean, I forget them on walk sometimes and then I’m cursing myself.Neil Henderson:
Well, there’s a couple of things to unpack there. And then then we’ll move on is that one. One thing I love the set is that build your business as if you’re going to sell it someday. And that’s very much. And he talked about the difference between an investor and a landlord. a landlord is somebody who’s probably you know, they’re, they’re working in, they’re working in the business, not on the business. And he the way he is looking at these short term rentals as a commercial property is not just a residential rental property. And with commercial, as we have talked about, in previous episodes, commercial real estate is valued very differently than residential real estate is based on the income it produces. And if he someday I know he’s growing towards this, if he is able to build up a portfolio of short term rentals, and he looked goes to sell that someday he’s not going to be just selling the property, the residences, he’s going to be selling the income stream that those properties. So it’s very important for him to build in those extra income streams because that raises his net operating income and raises the value of the property. So really smart. Really smart. We salute you, Michael, and, and your girlfriend, Maria. Maria.Brittany Henderson:
Awesome. So okay, so education, we talked about Fortune Builders is where he got a lot of his education. Sounds like he’s very well read. He mentioned a few different books and probably policy and different podcasts. Did you get any other sort of education pieces in there that you feel like important in the books, he said it was about six months before he was able to execute on his first deal once he was with Fortune Builders. AndNeil Henderson:
I know that he’s also i’m not sure we got into it. But I know this from reading Michaels bio as well as he did go to he went to Cornell for his undergraduate and then also was in graduate school, I believe that UC San Diego so he’s highly educated. He’s a business and businessman. So yeah, so he’s not your average. He’s not your average. Joe. He call himself a, you know, here. But he is educated. Yeah, he’s got a lot of education, business and real estate behindBrittany Henderson:
I don’t know that he needs that you need to be that type of person to do what he’s doing. I mean, we’ve already talked to a few different people but maybe not aren’t doing exactly what he’s doing, but are in that same same short term rental space, doing it a little bit differently, but still very successful. And you know, so Zika McIntyre’s one cannot remember his name. He does the subletting.Neil Henderson:
Oh, Fernando Angelo G.Brittany Henderson:
Uh huh. Yeah. So he has it’s a different method, but it’s still short term rentals. You know, and and i think their education backgrounds are different and buried. So, you know, it’s it’s definitely he is he is he’s a very smart man, man. And that probably has helped him to really grow faster and, and make some really smartNeil Henderson:
decisions will often I think, with what you get from a business degree is the is the, how important it is to develop systems. And I think so many investors forget that. They don’t do that. And they work working in their business, they burn out. And they’re the kind of landlords that either end up selling at a discount for the ones that are, you know, you hear all the horror stories about Oh, never be a landlord. It’s horrible.Brittany Henderson:
Yeah. Yeah. So and along with that, you know, not just Nope, it’s gone. I don’t know what I’m about to say. Doesn’t matter.Neil Henderson:
Let’s move on. So how much money did it take for him to get startedBrittany Henderson:
in this niche? And he said, Well, I don’t we didn’t really actually own this niche. Yeah, we didn’t specifically his first deal in this niche, just because we didn’t really talk about the numbers on his first deal, which were those mobile home. Correct. But the first deal was a what he bought it, it was $140,000 property, that he only had to put 10% down. So he put about 15,000. down and then he put about 35,000 into it for reservation. reservations. Yeah. rehab, and so about 50 k all in.Neil Henderson:
And he acquired that property for. So all and I think he was at 100. And well, all in $4,000. And and now he said it praised for $300,000. Now, so yeah, that’s good. Good equity there as well. SoBrittany Henderson:
yeah. All right. So time, I mean, we talked about this sort of, we asked him about it. And I don’t know that we really got huge amounts of numbers, we asked him like what he does, but not really how much time, I got the feeling that it’s still sort of full job for him, because he’s enjoying it on the parts that he does. As far as the actual operating it sounds like he doesn’t do a ton, maybe a few hours a week probably would be my guess, based on what he said. And then now he’s probably doing full time, job, ish amount of time on the looking for things and development and all that kind of stuff. Although he mentioned they went to Bali, and so I’m guessing they probably have a little bit of that time freedom to make decisions on what they want to do.Neil Henderson:
Yeah, it sounds like the day to day operations are fairly well systematized and outsource to employees, he talked about having operations manager and inspector cleaning crew, we didn’t really get into whether or not there was an analyst helping him outBrittany Henderson:
the inspector and the operations manager I think are the same, same person. That was what I got it, he said that the that person was an operations manager at a bigger company, which is not true. At least that was my understanding. could be wrong, but But yeah, he has a management team that he you know, and he talks about, really that he, you know, was big on hiring and finding the right people, so he can really trust them and you know, really feel like it’s it’s going to be done. Right. And he doesn’t have to be there he can be in San Diego, verbally, verbally. Yeah.Neil Henderson:
Yeah. So I would say his, most of his time now, I would say is probably on because they’re in growth mode. They want to grow. And so he’s Yeah, so the acquisition phase, where he’s having to new propertiesBrittany Henderson:
and trying to get back pays, he wants to, you know, educate and that comes up, which is awesome, because that’s really, that’s where you get into like the passion piece, you get those, you’re doing it in a way that even though you might be working, it doesn’t feel like work, necessarily, on most days, on a good day. So, and I think that’s really some people we say that we want, you know, top and location independence, it doesn’t mean that we don’t want to spend any time on these things, it just means that we want to have the flexibility to be able to go to Bali, and not worry about that, you know, what we’ve already put into place is going to be going to have a problem while we’re gone. And I mean, they said that they went and they were thinking about buying some properties there. They didn’t have the timing, but they did do some, you know, quote unquote, work? Yeah. But it was while they were having fun. So I think that’s cool. Because that’s really getting to where you’re passionate about what you’re doing. And it’s not just you’re not just going towards a goal is important. So can you do this from anywhere in the world? I would say yes.Neil Henderson:nd operating three properties:Brittany Henderson:
Yeah, it’s definitely important to get that I think he could probably be away for a significant amount of time, you just have to be available for you no problem calls for like if there was a really big problem. But my guess is that probably most of the people who are working within his system, have some kind of If this happens, you do this or you can spend this amount forNeil Henderson:
someone to say, hey, there’s a problem. The cost less than $200. Just take care of it. And then let me on. Yeah, so Well, that was Michael Hamilton with lips. swell.com check them out when he had a chance. He’s also got his book coming out July 29. Vacation Rental confidence. It was so great talking to him. All of the stuff we talked about will be in the show notes. Thanks for joining us.Brittany Henderson:
Let’s hit the road by and if you like this podcast,Neil Henderson:
we would really appreciate it if you take just a few minutes and leave a review for us on iTunes. It’s really simple to do. Just go to road to family freedom.com slash review for links and instructions. Thanks for listening. We’re doing this all again next week. Until then, safe travels.