Josh Miller (02:41):
And that was like the eye-opener to me of like, “Man, life is short.” Maybe going 30 years at this amazing job isn’t really the great American dream it’s all played out to be. So started looking for opportunities, discovered real estate. I’m a data geek. I love data. So I use the data to really figure what to do. And it was nationwide marketing trying to find the best markets all over the country, which was not really something done. But I didn’t know any better and ended up picking up my first deal for made around 30, 40K off of that first deal.

Josh Miller (03:13):
And that allowed me to… I didn’t want to quit my job. So instead, I hired two people to work for me and do more of that and ended up buying in over 30 different states, just buying and selling these properties. That was extremely stressful. It was a lot of hard work. Also, I felt like the market was going to crash at any time, and I’d be left holding the bag with all these properties. So decided again to look at the data. Chose Omaha, Nebraska because Warren Buffett [inaudible 00:03:40]. This was just like that’s where the data pointed and started buying rentals like figured that was really the way to achieve financial freedom and the passive income and everything else.

Josh Miller (03:51):
And a year goes by, a year and a half actually, have 120 rentals, all single families, a little bit multifamily in there. And I was like, “I was done.” I was like, “Okay, I left my corporate job, so I wouldn’t have a job.” I still have a job. How do I get out of this while I have to stop? So I actually ended up stopping in 2019, just living off of my rental income. That lasted for about a year.

Josh Miller (04:16):
And then, I realized that owning a whole bunch of single-family homes in a different state is not passive at all. And so in 2020, I ended up selling all but about a dozen properties and putting it all into Bitcoin. And that ended up being a great decision, way better than I was expecting. And so now, I guess I’m retired. I’m not really though, because I still work every day and really enjoy the data portion of what I was doing. So still continued doing that. So yeah, that’s my life.

Robert Leonard (04:43):
Did you cash out of your Bitcoin position?

Josh Miller (04:45):
No, I didn’t. I started buying probably in 2016, ’17. And I’ve just held. And so, yeah, I continue holding. And I don’t plan on selling any time. I really think that real estate is a great way to make money. There’s nothing better in my mind than real estate to make a quick… I don’t want to say quick buck, but to make money. And then I like crypto actually to hold my money. And now with staking all this other stuff, it’s a great way to earn passive income as well. So probably, the reverse of what most people say. But that’s my experience, is make your money in real estate, but it’s sit in crypto.

Robert Leonard (05:24):
Not a lot of people listening to this show have left their corporate job to invest in real estate full-time. My guess is that quite a few people have that goal. They just haven’t gotten there yet. So what were your considerations before making the leap? How did you ensure that you didn’t have golden handcuffs?

Josh Miller (05:40):
Yeah. Great question. So for me, I realized what I was really good at. I was really good at the data, and I wasn’t good at sales. I wasn’t good at talking to homeowners. I wasn’t good at operations. I wasn’t good at all these things. And so in my mind, I kept my corporate job and actually use that income to hire people, to do those rules of those positions that I was not good at. And I bought hundreds and hundreds of properties. I’ve talked to a total of two homeowners, the first one, and then one later on just because I realized I’m not good at talking on the phone. So I actually kept my corporate job for a long time because I needed that money to pay other people.

Josh Miller (06:18):
And when to leave, I look at it at an hourly basis. Maybe, that’s my engineering brain. But I look at what I was getting paid at my job. So let’s just use a round number. Let’s say I was making $100 an hour. If I could hire people for less than $100 an hour in my real estate business, then I should just keep working my corporate job and hire people that probably cost less than $100 an hour and were better at it than I would ever be. Once you surpass that, which I was looking at the visionary position to hire someone in that position, you’re probably looking at three, $400 an hour. At that point, when you get to a position where you need to hire somebody at that dollar rate, then I said, “That’s the point you need to move on.”

Robert Leonard (07:02):
And so what if you’re hiring multiple people? Let’s just say, you’re going to hire two, three, four, five people at 20, 30, $40 an hour. Are you looking at that in total? So what their total hourly rate would be rather than just not one person?

Josh Miller (07:15):
Yeah, absolutely. But at the same time, you got to look… Well, no. It’s not cumulative because it’s what you can do. You only have so much time in a day. So yeah, maybe you could do it two-thirds times better than somebody else. You may not use a full dollar amount. But at the same time, yeah. You got to add those. What is your time worth essentially is what it comes down to.

Robert Leonard (07:36):
How does somebody know when they’re actually ready to take the leap? Is it strictly just based on that hourly rate dynamic that we just talked about or should somebody have a certain number of properties? Does their monthly cash flow have to exceed their current income? How do you think about those things?

Josh Miller (07:52):
Honestly, I would probably still be at my job if they didn’t give me an ultimatum. I think they gave you an ultimatum too if I remember right.

Robert Leonard (08:00):
They did.

Josh Miller (08:01):
Yeah. At the end of the day, they moved the whole company down to Houston. And I was in California. And I love my job, and I probably would still be there because it was incredible. It’s a data job that I get to work with some of the smartest people in the world. But, yeah, at the end of the day, that was my driving factor. For anyone else though where they’re not giving you an ultimatum, I did have quite a lot of passive income coming through from all my rentals when I left.

Josh Miller (08:28):
I was making pretty much the exact same. So that definitely helps a lot. I don’t think that there’s any hard number that you need to look at other than make sure you have that 100% confidence that what you’re going to be going to set out to do will 100% work. If there’s any doubt in your mind, don’t do it because it probably won’t work.

Robert Leonard (08:48):
Was your ultimatum that you had to move to Texas or was it that you couldn’t do your real estate on the side?

Josh Miller (08:53):
No, it was that I had to move to Texas. I was still doing all my real estate on the side. I was doing incredible. They loved me. I loved them. It was great. But they sold our company three years prior… My little job that I was at for the big corporate, they sold it off. And so they only kept the handful of employees. I was one of three out of, I think, 400 that they kept. And they told everybody else, “You have to move.” And I kept staying on, staying on, staying on. So after about three years, they’re like, “Look, Josh, we like you. But you got to move.” And I was like, “I’m sorry, I’m going to pursue this real estate.”

Robert Leonard (09:30):
So you mentioned that you had 120 properties rentals in your portfolio. I don’t want to just gloss over that. I don’t want to skip that. I want to go back because that’s a massive number. And I know you did it in a short period of time. And you also did 307 contracts. I want to talk a lot more about your background and some of those deals. So tell us a bit more about what some of those properties look like. Tell us what the contracts were. What exactly you’re doing with all these properties?

Josh Miller (09:55):
Yeah. Great question. So it depends on what you’re doing. I focused on the data. I focused on marketing. To me, it was really all about marketing and sales. So I would find the right areas to target in the city. I would find homeowners who needed to sell. I would get it under contract. And then, I would figure out what to do from there. And so all of the contracts, essentially, we would have a disposition team that had really cool Excel tools and other tools and a flow chart to figure out what to do.

Josh Miller (10:26):
The first is always I wanted to keep it as a rental. But if it didn’t fit the right ROIs, if we didn’t have crews available, funds available, et cetera, we look at the next option. And I can just rattle them off, and we can go into any of them in detail. But rentals, fix and flips, lease options, wholesaling, hoteling, realtor referrals. So essentially we just generated contracts and then figure it out how to make money off of those contracts in whatever was made sense with the property and the conditions of the sale.

Robert Leonard (10:56):
What is hoteling?

Josh Miller (10:58):
Hoteling is where you buy a property, and you don’t put any money into it to fix it up. But then you just immediately list it on the MLS and you resell it. Different than a fix and flip, you’re putting actually repairs into it. Different than a wholesale because, wholesale, you don’t actually close on the property. You don’t go through title and escrow to actually take possession of it in your name.

Robert Leonard (11:22):
So it’s like a wholesale. But you’ve just taken ownership. We’ve taken title of it.

Josh Miller (11:26):
Yeah. There are some downsides. The downsides are you have to pay for the closing costs. But the upside is you now actually own it. And you can list it on the MLS where you can have as many showings as you want. And you’ll typically get a much higher price for it than you would just wholesaling it.

Robert Leonard (11:44):
What period of time did you do these 120 rental properties and 307 contracts? Was it over a year?

Josh Miller (11:51):
Yeah, so I was doing nationwide up until about mid-2017. And then mid-2017 is when I moved to Omaha. I stayed in Los Angeles. But I virtually moved to Omaha. And then, it wasn’t until about 2019, beginning of 2019, that I was like, “Okay, I’m done.” So really, if you look at it, all of 2018 is when the bulk of everything happened.

Robert Leonard (12:15):
So you’re looking at anywhere from eight to 10 deals a month. Not only that. I mean, that’s a ton of work. I mean, I’ve closed on… The most I’ve done in one month was three. And that was a ton of paperwork, and it was just a ton of work. It sounds like you probably had some employees to help you with that. But also on top of that, I mean 120 properties in a year. That’s a lot of capital needed. And I mean even financing. Financing is a nightmare. So a couple of things. One, how did you or what did you use for capital to buy these properties? And two, how did you deal with the financing piece of it?

Josh Miller (12:47):
Yeah. Great. So I really believe in staying in your lane and staying what you’re good at. And I was good at numbers and data. And so that’s all I did, was the figuring out the marketing really and then finances. You can’t really hand that off to anybody else as far as raising money. So that was the other thing that I spent a lot of time. And so I’m glad you’re asking these questions because everything else, I don’t really know anything about.

Josh Miller (13:09):
But, yeah, regarding the money, I think it’s great to go back to my very first deal. It was somewhere in Wisconsin. And it was I needed $40,000 to close on it. And I didn’t have $40,000. So my very first deal, I actually went on to biggerpockets.com, and I wrote a post saying like, “Look. I have this property. I think it’s worth $100,000. I’m buying it for 40. Will anybody lend to me?” And I don’t know why, but somebody said, “Yes.” And I was honest. I was like, “I’ve never done a deal. But here’s the facts.” And they wrote me a promissory note for 10% flat interest, no points, which was incredible. I had up to a year to pay it back, and I had to play a fat 10%.

Josh Miller (13:55):
I ended up buying and then closing it to the realtor who was supposed to listen to me the next day. So the investor got his money back within two days. But that was my money on the first transaction. So that was the way I raised money for a long time, was just going out and asking strangers, asking friends, asking family and saying, “Hey, look. Your money’s secured by a property. So if anything happens, you got this property.”

Josh Miller (14:20):
And so I raised a lot of money that way. But it’s expensive. That’s essentially hard money lending. When I started building up my rental portfolio in Omaha, I don’t know why I did this. But the first day, I landed to go check out the city. I didn’t actually check out any of the properties. I just checked out the banks. I just squint and started walking into every single local bank saying, “Hey, I’m Josh Miller. I’m a big-time investor,” really selling myself. But having them just meet me so that when I went back to them months later and said, “Hey, look. I got all these properties,” they knew who I was and everything else.

Josh Miller (14:53):
So spent a lot of time at the beginning with hard money lenders and then some bigger companies like Lima One Capital and some other nationwide lenders. And then over time, once the local bank started seeing like, “Oh, this guy is legit,” they started lending to me. And those are incredible because I was actually getting paid for every single one of my rentals. It was insane because just think about our marketing. Everything was off-market. So we were getting incredible deals at 60 cents on the dollar.

Josh Miller (15:22):
So let’s say a house costs $100,000. We were getting it under contract for, let’s say, $60,000, maybe 70,000. The local banks would loan to me at 80% of the fair market value. So they were giving me a loan at 80 for 80,000. So I buy it for 60. I get a loan on it for 80. I just got paid to buy a rental, which is insane. So that’s really what allowed me to grow.

Josh Miller (15:47):
I reached my first million of loans with the first bank. And they’re like, “You got to pause for a second. We’re going a little too fast.” So I just reached out to another bank and another bank and another bank. And everyone seemed really happy. The banks want to make money too. So here’s a guy that has solid property management. It’s finding these incredible deals. They didn’t even inspect. I don’t know if things have changed now.

Josh Miller (16:10):
But in 2018, 2019, I would give them the address. They would drive by, and they’d be like, “Okay. Yeah, that house is worth 100K.” And I was asking. Yeah. So it worked out really well. I literally got paid to build up my rental income, which is kind of cool.

Robert Leonard (16:26):
What were they looking at to underwrite that deal? Were you at your W2 job at the time? So they were just using your W2 income to kind of approve that loan or was it just because it was based on the asset? It was an asset-based loan and it was just such a good deal that they were okay with it.

Josh Miller (16:39):
Yeah. So at the beginning, it was definitely the W2. At the beginning, it was definitely all about me. A 100%, it was all about me. It was about me securing it. I’m forgetting the term, but essentially I was at risk. So if anything happened, Josh Miller had to pay. But over time, yes, 100% about the deal. There’s 100% about the property and where the property was located. And our corporation, our LLC, it was who was borrowing it.

Josh Miller (17:09):
Another nice thing that was that we were able to do was we built up a really nice line of credit as well. And so when I had a line of credit for a million dollars just sitting there, we weren’t touching it. And I’m asking for a loan for 70, $80,000. They’re like, “Yeah. This totally makes sense.” So at the beginning, it’s all about you, your W2. But over time, it turns into just about the deal.

Robert Leonard (17:32):
How did the ownership structure change over time because you were working with hard money guys at the beginning? So were you paying them all just a hard percent fee on top of whatever you borrowed or were some of them taking equity? Did you have partners? And did that change over time as you went to banks or were you always just 100% owner and you just found financing?

Josh Miller (17:50):
I did try it one time. I reached out to some friends, and they lent me 400K to… Well, they weren’t friends, but friends of friends. And we tried to structure it. And it’s very time consuming and everything else. So, yeah, it was always about just paying a percentage. Essentially. I said, “Look, the dream is to own a bank.” The banks are all the biggest companies in the world. That’s everyone’s dream. You can be a bank. That straight up. And people kind of got that. And so, yeah, I wasn’t doing equity other than the one time, is always about here’s an interest rate and we’ll pay you. Do you want it back in a year? Do you want it back in three years? Do you want it back in five years?

Josh Miller (18:32):
And, yeah, typically range between 6%. And I was paying as high as 12% at one time when I really, really needed money and there was a great deal. It made sense to do 12% because I knew I could pay it back and still make money.

Robert Leonard (18:46):
Talk to us a bit about your marketing. I don’t want to go past that either because that’s clearly… I mean, if you’re able to buy things at 60, 70 cents on the dollar, obviously, people listening are going to be interested in that. And we’d love to learn what your strategies were to do that and how we can do it too.

Josh Miller (18:59):
Yeah, absolutely. And it is definitely gotten a lot tougher. I still do a lot of marketing every day. But it is 1000% still possible today. So don’t think like, “Oh, that was two years ago. That was three years ago.” No, it still is. It’s just harder. It’s really about two things. When I keep saying data, it’s all about the data. It’s about, one, choosing the right market and then, two, choosing the right list to go after.

Josh Miller (19:21):
So as far as choosing the right market, the big overview of that is just think about it. If you were to go door knocking, if you had to go knock to get one deal, you had to knock on 10 doors versus you have to knock on a thousand doors. Where would you want to be knocking? So choosing the right market is, I think, the most important. And then the second most important is, okay, what list are you going after?

Josh Miller (19:48):
There’s really no secrets. It’s just people don’t want to put in the hard work to get it. Anything that you can buy, buy a software or buy a list, it’s no good. And the reason it’s no good is because there’s… I like biggerpockets.com/stats. It shows you how many new members they get every single day. They get over a thousand new members every day. That means there are 30,000 new investors coming into the space every month.

Josh Miller (20:13):
So if you can buy something, if you can easily locate it, it’s probably not a good list. It’s probably not a good marketing strategy. What really is the good ones is the things that are really hard to get. So think of what’s hard to get. It’s arrest records. It’s evictions. It’s code violations. It’s water shutoffs. It’s all of these different distress factors that are 100% public. It’s 100% possible to get.

Josh Miller (20:40):
But because it’s hard to get, for example, let’s say an arrest record, you have to go onto your county jail or prison website, figure out a way to extract the names. It’s all public of the people getting arrested. Then take those names. Go to your county website. Put those names in. See if the names match up, and see if they own a property.

Josh Miller (21:03):
I mean, that’s a lot of work. But that’s where we’re at today. It’s no longer can you just buy, say, an absentee list and say, “Oh, the guy lives out of state. He must have some distress factors. I’m going to mail to him.” It does work. But you need an insane amount of quantity to make that work. Then, it’s just a numbers game. If you don’t have a large budget or if you’re just starting off, then, it really does become about choosing the right market and choosing the right niche to really go in that. And the harder it is to get, the better it’s going to be.

Robert Leonard (21:33):
So for somebody who’s listening who hasn’t heard of what lists are in real estate or list like Joshua said, you might have an absentee list, which just means that the owner doesn’t live where the property is. They’re an absentee owner. And so basically what the list is, is just a list of all these owners in a given area. And then, the strategy is to then call these people and see if they want to sell their property. There are all kinds of different lists. Absentee is just one of them.

Robert Leonard (21:56):
You mentioned some of the more peculiar ones, like, arrest records and some of the other ones. Why do those work? What do you do with an arrest record? You find a guy or girl that’s got arrested. How does that turn into a good real estate deal?

Josh Miller (22:08):
So what we’re looking for as real estate investors, we’re looking for homeowners who it’s not that they want to sell their house. They need to sell their house. So they’re in some type of distress factor that selling their house is a solution to their problem. If it’s all about money, then honestly, real estate investors can’t help all that much. Probably, the best solution is to list the property and sell the property to a realtor because that’s how you’re going to get the most amount of money.

Josh Miller (22:39):
So we’re not looking for the people who have the money problem. We’re looking for the homeowners who have some type of distress factor in their life that we can help solve. And this home is part of the problem. So hoarders, a landlord who can’t evict his tenant, these are all issues, problems in their life that they want solved. We’ve bought properties from realtors, which is mind-boggling. That doesn’t make sense to me. Why would a realtor sell me their property so I can make money off of it? Why don’t they just listen?

Josh Miller (23:12):
But that realtor had a problem, and I was an easier solution for them than it was for her just to list it herself or to have somebody in our office list it. So that’s why coming up with those lists and finding those problems is so important. And then, the conversation doesn’t become about money. It becomes about, okay, what’s the problem with your life? Oh, you got arrested. Okay. Well, what are you doing with the property? Oh, it’s just sitting there. Oh, shoot. And you’re having to pay the taxes on it. Oh, you’re having to pay the insurance on it. Whatever the case might be or there are squatters in it. Oh, all your friends are just sitting in there doing drugs. And do you know… That sucks for you. Why don’t we let you know what I’ll do? I’ll kick them all out. I’ll get a sheriff down there. We’ll kick them out. We’ll sell the property. We’ll get you the funds. And that way, your old friends can take advantage of you. Sound good. Sounds good. So that’s the kind of reason we’re going after these harder-to-get lists.

Robert Leonard (24:11):
You just mentioned arrests, which I think is a pretty interesting one that I hadn’t really given much thought to. What are some of the other more peculiar ones, I guess, you could say that you’ve used in the past, that work really well, or just in general, what are the best working lists that you’ve found to have the most success?

Josh Miller (24:25):
Yeah. Absolutely like hands down. The very, very, very best list is inherited properties. Inherited properties, there’s no comparison because when you inherit a property… And this happens a lot. There’s a lot of narrative properties going on. Any time somebody passes away, essentially, there’s an inherited property.

Robert Leonard (24:45):
How do you find that? Do you look for death records?

Josh Miller (24:48):
Yeah. We looked through death records. Absolutely. So every single day, we get every single person that passed away in the US. And we look and we see, okay, did that person own a property? Some of those, you can buy. There are lots of companies that sell like pre-probate records and other things. But I’ve found that it’s best to choose a market and then do it yourself in that market. That is the very best.

Josh Miller (25:13):
Once you start combining an inherited list with other lists, then it just skyrockets. So if you can find an inherited property where there’s a code violation on it, or an inherited property where there’s some tax delinquency on it, or a code violation and a vacancy, that’s really where you’re going to… It’s a done deal. It’s just when they’re going to sell. It’s just who they’re going to sell to.

Robert Leonard (25:34):
Why is inherited so good?

Josh Miller (25:36):
Because there’s no, like, “Hey, this house is mine. I need to maximize the dollar amount that I get from it.” It’s typically it’s a problem that we can come and solve of like, “Oh, you got this house. You’re not sure what to do with it. Let me solve that problem” versus if you live in a house or you paid for the house and things have been appreciating, right? So in their mind, it might be worth 100,000 when it’s really worth 400,000 and all sorts of crazy situations. But, yeah, if you want to spend your time, the best use of your time is going to be going after those inherited lists.

Robert Leonard (26:13):
I’ve heard these types of strategies a lot from wholesalers. Do you use this for finding rental properties too or do you only use this for your wholesaling?

Josh Miller (26:22):
Yeah. So the way I saw it was I wanted deals. And at the end of the day, if I spend my money on marketing to try and get up to my perfect rental, but I’m dismissing all these other opportunities, that’s silly. So spend your money on marketing. Get the contract signed and figure out what to do with it.

Josh Miller (26:44):
Of course, you’d love it to be a rental property. But if it fits all these other criteria, as of when maybe it does not a great rental, it’s kind of like, of course, you should try to monetize it. So we talk with people every day that it’s the best thing for them is to list the property. I would love to buy it as a rental. But the numbers don’t make sense for me. And so you should list a property.

Josh Miller (27:05):
So getting a realtor referral fee from that, or I know there are some technicalities about realtors paying referrals, but there are ways to do it. That’s a great way to pay for your marketing so you can do more marketing, so you can buy more rentals because at the end of the day if you can be buying properties at a discount and like I was getting paid by my rentals, that makes a lot of sense. At least, I think so.

Robert Leonard (27:28):
What is the cost for this list strategy that we’re talking about? Let’s say someone listening to the show is like, “Wow, I love this strategy. Makes a lot of sense. I want to try it.” How much does it cost them to go get these lists and do this? Are there any upfront costs? What are their marketing costs, et cetera?

Josh Miller (27:44):
Yeah, absolutely not. That’s why I really think real estate is the best strategy to make money versus other strategies like crypto and stock investing, which is more of, you kind of need money to make money, or you need to be super lucky or something. But with real estate, it’s almost like there are so many ways to make money in it that really, no, you really, really don’t need. It sounds weird. I’m sounding one of those fake guru people, whatever. But you don’t need to buy anything. That’s what’s crazy about it.

Josh Miller (28:15):
Every list I mentioned is online, on county websites, on government websites that you can go access and get for absolutely free where you start may decide to. And so that’s if you have no money. If you do have some money, it does help because you can pay for people to go and extract these lists. You can pay for virtual assistants to do the work for you. You can find companies who already have that data and then buy that data from those companies.

Josh Miller (28:44):
So money just helps speed things along. But every list and every niche is essentially free. So go get that list. And then it’s like, “Okay, how do I actually contact that person?” Well, then you’re going to have to spend some money. But it’s actually not that much. One, you can skip trace those contacts. You literally just need an address, and you can put it into… There are a hundred different things out there. You put that address in, and it spits out a phone number or, if the better, is just go knock on the door, talk to the neighbors and that’s 100% free and be like, “Hey, I’m an investor.”

Josh Miller (29:18):
And the nice thing is you don’t need to know the hundred next steps because once you get that contract, you can go partner with an established real estate investor. There are so many things you can do, so you don’t need to know, okay, how do I raise money? How do I sell these contracts and all the other stuff? If I want to keep it as a rental, how do I work in the banks? Literally, just get that piece of paper. That contract is worth so much money right now.

Robert Leonard (29:46):
Do you think there’s any value in just the leads themselves without the contract? What if somebody, maybe they’re saying to themselves, “I’m really comfortable. I’ll go get all this list. I’ll do all the work. I’ll find 50 different people that seem like they could be good potentials. I don’t know. I haven’t talked to them. I have no idea if they want to sell or not. I’m not really interested in talking to these people. I’m not good at it. I don’t like it. I don’t want to do it. And I don’t really know the lingo. I don’t want to do the contract, et cetera.” But I have this list of 100, 200 people, whatever it is, that might be good leads for somebody else and investor. Almost like a VA, I guess, you could say. Is there value in that? And is there’s a way that somebody could start generating a little bit of money doing it that way for their local area? What if you live in a small town and you just want to do it for local investors?

Josh Miller (30:27):
Yeah, I would. That 100% would work. But I would start with the conversation first with an established investor. Find out who’s kind of the biggest guy in town doing the most number of deals. And go talk to them and say, “Look, I’m just trying to learn. I don’t have money right now to hire a sales guy. So can I use your entire team?” They’re going to get paid a whole lot less than if you actually got on a contract. But 1000%, a really established investor would say like, “Hell, yeah. You go do all this work. You’ll bring it.”

Josh Miller (30:55):
Absolutely. But I will give a fair warning that, because there’s so much money in this space, there also is a ton of bad people in this space. And there’s just a really like… I don’t know why it is. But it seems to attract a lot of bad apples. So I’d be very careful about who you partner with. Really, try to find the people who aren’t just in it for the money, but who are doing good things, have built great teams, and everything else because there’s a lot of shady stuff going on.

Robert Leonard (31:24):
Well, the model that I’m thinking of is very similar to Zillow, right? Real estate agents pay Zillow X dollars for a lead, for a potential seller or buyer. And then whether that works out or not is kind of up to the real estate agent. And there’s a couple of different models. But that’s a very popular model for real estate agents. They’ll pay for the leads. So I was kind of thinking like, “Would real estate investors pay for leads to potential properties?” Just like Zillow doesn’t know if that person’s going to actually buy or sell or when they will, the person who’s finding these lists doesn’t know if they’re going to buy or sell. But they could still sell those leads to an investor as if they were like the agent in the other example.

Josh Miller (31:59):
100%. All I’m saying is like, don’t just put it out there because you just want to make sure you partner with the right investor that you’re selling it to because I have heard people doing all this work, selling the leads. And then the investor will be like, “Thanks a lot. I’ll pay you if I make any money.” And they make money, and they don’t pay.

Josh Miller (32:16):
So just make sure you align yourself with the right investor. Don’t just throw it out to anybody because if you do a lot of this hard work, it is hard work, obviously, you want to make sure you get paid. But that’s an absolutely 100% viable solution for somebody who doesn’t have the skills or the money to hire a good salesperson to take it the whole way.

Robert Leonard (32:36):
Yeah. You definitely want to make sure that person has a reputation and make sure you don’t want to get taken advantage of. But I see this as a way where you could literally make money with $0. Are you going do, I mean, just putting a little bit of time and effort and you could make money?

Josh Miller (32:47):
I mean, a big one in this, I don’t think you should do this, not use specifically, but the listeners, because I think your time is worth more than this. But there’s this thing called bird-dogging or driving for dollars where, literally, investors pay people to go drive around town looking for rundown homes, maybe on trash day that they didn’t put out their trash, things, indicators it might be vacant. And then, you send them those lists. But you’re not going to get paid that much because that’s a low dollar per cost work. That’s $10 an hour of work. You really should be trying to go after these harder-to-get lists because that’s not $10 an hour work. It is if you set it up. But the visionary to kind of create the structure and SOP to follow, that’s not $10 an hour.

Robert Leonard (33:38):
And those lists that we get online, whether it be arrest records at heritage lists, whatever, might be probably more valuable than the list you get when you go driving for dollars or bird-dogging. And so that might make the value per hour better for somebody who’s looking to do that?

Josh Miller (33:53):
100%. I mean, driving for dollars is incredible. It’s a great list for sure. But I would still prefer my inherited list.

Robert Leonard (34:01):
And the reason that I feel like I agree with that is because I’ve seen some houses that look like they are absolutely ready to go, ready to be sold. They’re just done. And then, I’ve seen the same guy live there for 20 years still. And like you, so you just don’t know. You know what I mean? And things could look bad from the outside. And I guess you just don’t know. And it’s the same way with the list, I suppose. But I think you can only gauge so much from trash cans and what it looks like outside.

Robert Leonard (34:28):
When we started talking about this, you said the first piece was to find the right location to even get these lists. So what does that look like? What is the right market look like? What do you define as right or good?

Josh Miller (34:40):
So a lot does depend on your niche list. But, essentially, what we’re trying to do is we’re trying to find a lot of distress. That’s a lot of distress in an area combined with people buying and people flipping, and investors buying in that area. If you were in buying in certain areas of Detroit at the wrong time, you could get homes for free. You could get paid to get home. So yeah, there’s lots of distress. But there’s no need for the homes.

Josh Miller (35:09):
So what we’re really trying to do is look at MLS data to see where is there low days on market, where is a lot of activity. We’re looking at county records to see, hey, where a lot of cash buyers buying. And we’re looking at demographics, looking at things like where’s there a lot of distress with not an insane amount of crime. Where there’s too much crime, you really want to stay out of because investors don’t want to be buying in those areas.

Josh Miller (35:39):
And I actually wrote down three websites, so all of this is free, which is cool that you can go to, to actually get this data for yourself and start diving in. The first one for MLS data, realtor.com actually recently released their full MLS data set, which is crazy to me because it’s always been so private. It’s been always so hard to get days on market. First, you’d have to get your realtor’s access, is all this stuff. They released it all, which is crazy, and it’s updated monthly. So you can find a full Excel file there with all of that info.

Josh Miller (36:10):
And then for county data, there are some good tricks. You can actually get a lot of information from listsource.com without paying for anything. And if you YouTube how to find cash buyers from listsource.com, you’ll find a tutorial on how to do that.

Josh Miller (36:26):
And then the third, which is my favorite, is eig.org. And that’s where you can get demographic data for free, which is crazy. There’s an option to purchase it, which is what I’ve done. But there’s also a free option just to view the data and see there’s actually a really cool heat map. And so what I’ve done is I’ve combined those three data sets along with a lot of others and created a cool free tool. So people are welcome to look at that. But if you want to do it your own and you love data, then those are three great websites to go check out for yourself.

Robert Leonard (36:58):
You talked about crime. What do you define as too much crime? What is that threshold? And it’s probably different for multiple people, right? You might have an opinion on what too much crime is. And I might have a different opinion on what too much crime is. But I’m curious to hear what do you think is too much crime? And one of the ways that I go about this is I invest long-distance exclusively pretty much.

Robert Leonard (37:16):
And one of the ways I do it is I look up what the crime is where I live so I can get an idea as to what the crime is. And then, I look for that same demographic data point for crime in the other city, and so, I can compare the two, and I can say, “Okay, it’s more crime than where I live or it’s less crime.” And I can kind of get an idea because if you use different metrics, you might not know. And you can’t compare apples to oranges. So if you used the same data, that’s how I like to do it. But what do you find is too much crime?

Josh Miller (37:40):
Yeah. So I really liked that eig.org website. And it actually ranks the entire country on one scale. So it’s really nice. Typically, this won’t mean much to you right now. But it’s zero to a 100, 100 being like you cannot set foot in that area. One being like it’s a Beverly Hills. So I usually like to stay under the 94 mark. But, yeah, it is all relative. And I think that’s where you can look at it on a number on a data set.

Josh Miller (38:11):
But then, at the end of the day, actually going there and looking at it. A great example of this is when I first started looking at Omaha, Nebraska, there’s a certain zip code stat. Everyone was like, “Oh, stay away from it. It’s horrible. It’s gang zone and all this other stuff.” I’m from Los Angeles. I went there, and I was like, “This is nice. What are you talking about?” It is all super relative.

Josh Miller (38:37):
Really, at the end of the day, especially if you’re wholesaling, especially if you’re just getting things in our contracts is it doesn’t matter how bad the crime is in your mind, as long as there are investors buying there. So look at homes that are on the market. And if you see that they’d been fixed up and repaired, there are investors there. That doesn’t take any really data. That just goes on Zillow. Look at what’s being sold is, has that home been flipped? If it has, you know that there are investors still doing.

Josh Miller (39:05):
As long as it hasn’t been on the market for 200 days, make sure these homes are getting moved. But, yeah, crime is relative, like you said. So don’t be afraid of what people say or what you might think. There are always out-of-state investors who will think differently than you.

Robert Leonard (39:21):
Well, I mean, if the scale is one to a 100, and you’re willing to go up to 94, I mean, that sounds 100 is as if you’d never want to step foot in there. Going to 94, I mean, that seems like you’d take on a lot of crime.

Josh Miller (39:32):
Yeah, absolutely. But I wouldn’t hold a rental in 94.

Robert Leonard (39:36):
What is your threshold for rentals?

Josh Miller (39:39):
I don’t know because I only marketed in one city for my rental. So I don’t know what that magic number is. But I think that’s this fear thing that a lot of people have is like, “Oh, that’s a dangerous part of town. I don’t want to buy rentals there.” But there’s no reason you can’t make money there.

Josh Miller (39:57):
And when choosing a market, one of the things I miss that I really look at and especially if you’re starting out is choosing these lower price zip codes, these lower-priced areas where the home prices are less than 200,000. And the reason that’s so important is, one, and I think in the most important aspect is it’s really hard to eff up on homes under 200,000, like even worst-case scenario. And you way overbought. You overpaid by, let’s say, 20K. 20K is absolutely forgivable.

Josh Miller (40:29):
And you can always dig yourself out of a 20K mistake versus if you’re buying a $500,000 property and you buy it too high. And you do your repairs too high and 100K over, that’s kind of hard to dig out. So when choosing a market, going to these areas that are under 200K, I like to stay out of the areas less than 50K. You’re going to do it because, one, it’s very forgivable. And then, two, homeowners, 10K is not that much to them, right?

Josh Miller (41:00):
If you have an asset that you bought for 20, and now it’s worth a hundred and somebody comes and says, “Hey, you don’t have to do anything and just sign this paper. And this problem’s done dealt with,” 10K’s not that big of a deal. 15K’s not that… But for us, that’s a lot of money to make on a deal versus somebody who owns a property of 500,000, you need to be 100K less in order to make all the numbers work, the closing costs, the hard money, all that other stuff. So that’s where I really liked that 50 to 200K range.

Robert Leonard (41:31):
And I feel the same way. I feel like there’s a lot of gurus out there in the real estate world that tell people that you need to go as big as possible as soon as they can. And I’ve always kind of just disagreed with that and felt that people should start as small as they can at first, just because like you talked about, $10,000, $20,000, it’s manageable, right? You can salvage something from it. You’re not going to dig yourself a massive hole.

Robert Leonard (41:51):
And so that’s why I like to personally recommend people start small. And so if they totally screw it up, whatever the type of deal is, as long as even if you screw it up, but you’re not going to dig yourself a hole that you can’t get out of. But if you do this with a $750,000 property, I mean, that’s another story, right? That’s a big hole they have to dig yourself out of.

Josh Miller (42:07):
It’s so interesting hearing you say this because, yeah, I did hundreds of properties and made millions of dollars. And it was a ton of work. And some guy can say, “Look, I just did one property, and it was a big hundred unit multi-family, and I made a million dollars.” What would you rather do, hundreds of properties or… Yeah. If I knew everything to do that, sure, of course. It’s way, way, way, way less work. But there’s so much knowledge and experience.

Josh Miller (42:36):
And if anyone could just go and make a million dollars wholesaling, a multi-family or whatever, everyone would be like, “It’s not easy.” Even doing a single-family homes telling somebody to knock off 10K off their price so that you can make some money and make this all happen, that’s tough. That’s hard. So, yeah, I’m 100% with you that, yes, doing these big deals, is it easier? Absolutely. It’s a lot less work to do one huge multi-family. But unless you have all that knowledge and experience, it’s not something that you can read in a book. And I do agree with you that it’s way easier to learn, to do these small little single families, and then use that knowledge and experience to do these larger deal sets.

Robert Leonard (43:20):
That’s exactly right. Start small. Learn what you need to learn, and then you can get bigger. I’m not saying you have to stay small forever. I’m just saying a lot of gurus say, “You need to start big as soon as possible,” even recommending as your first deal. And that’s where I have a little bit of a disconnect. I think you start small for your first dealer too. And then if you’re comfortable going big, go big. But I think you should at least start small. Right? And then grow.

Josh Miller (43:42):
Yeah. I have made so many mistakes. It’s insane how many mistakes I’ve made and how much I learned along the way of bad loans, bad contractors, bad deals, bad employees, bad everything, everything that can go wrong and real estate seems to go wrong.

Robert Leonard (44:01):
And it feels a lot better on $100,000 property, doesn’t it, than a million-dollar property?

Josh Miller (44:07):
100%. Nothing goes right especially when you’re learning. But like I was saying, if you’re out 10K, you can dig yourself out of that. You can buy one bad property and be like, “Oh, well I’ll make up the money the next day” versus if you go bad on a big deal and your 150K earnest money is tied up, you’re kind of screwed. What are you going to do? You still got to pay interest on that. It’s a much bigger deal. So, yeah, this is cool. I’ve actually never thought about that or talk to them about that. But I’m in full agreement with you there.

Robert Leonard (44:40):
And I think of it too as almost like a form of education. And so we think about college, right? People are willing to pay 20 to 50, 70, 80 grand a year. And so, who cares when you screw up on a $10,000 property, you screw up on a $20,000 property? I mean, yeah, that sucks. But that’s a relatively cheap form of education. Most people are willing to spend 50 to $100,000 a year for college. What’s 10, $20,000? If you do lose that, I’m trying to learn in a real estate deal whereas you get into those bigger deals, 150, 200, $250,000, that’s at risk.

Robert Leonard (45:12):
Now, that’s a totally different story. And there’s also the non-quantitative piece of this, where you have reputational risks. So on a small property, if you screw up, most likely, nobody’s going to know. You’re probably doing it yourself. You probably didn’t raise money. You’re probably not burning any bridges. You don’t have brokers knowing your name for not closing on deals, et cetera. You start to get into this big stuff. Real estate is a big world. But it’s really not, right?

Robert Leonard (45:34):
It’s pretty small especially when you get into the big stuff, it’s really pretty small. If you screw that up early, people are going to remember that. And I’m not saying you can’t dig out of it or you can never get away from it. But it’s going to put a dig on your reputation early. And I don’t know if that’s the best way to go. I don’t think it is.

Josh Miller (45:50):
Yeah. I couldn’t agree with you more. Speaking to the education, the $40,000 coaching program or all of this stuff, that’s the thing about these small single-family homes, is you don’t need to do that much work to actually… I shouldn’t say do that much work. But it’s very simple. Let me just say it’s a very simple process. It is a lot of hard work. But the process to learn it and actually implement a step one, choose a market, step two, find a niche list, step three, try to go talk to those people. Step four, like we were saying earlier, forget about even putting in a contract, then say bring it to an investor and say, “I’ve talked to this person.” I hear she’s ready to sell, make the contract, and all that happened.

Josh Miller (46:42):
That is not a far stretch. That is not, like, inconceivable. And yeah, you may not make 10K, 15K on your first deal especially if all you did was do those first three steps. But, sure, you’re going to get a few thousand dollars from that investor for bringing you that opportunity. So I feel like the path to success, the path to creating some instant money that you can put back into doing it more and scaling, it’s a lot easier on that small single-family home.

Josh Miller (47:12):
Another thing is when you’re at that much smaller scale, there’s a lot more of them. And when there’s a lot more of them, there’s a lot more opportunity. So how many huge multifamily hundred-plus unit apartments are there where the property owner inherited the property and there’s a code violation on it and there are some tax delinquency items on it? There are probably not that many.

Josh Miller (47:38):
But there are literally tens and tens of thousands of those in the United States and in the single-family home space that anybody can go dig up and go after. So the…just pure quantity of opportunity in the single-family. There’s a lot.

Robert Leonard (47:54):
As we get towards the end of the show, I like to ask guests three questions that create an action plan for listeners for when they’re done this episode. I think everything we learned throughout the episode is great. But I don’t want to see people just listen to this episode and not take action because just learning this stuff is essentially useless if you don’t actually apply it. So I really like to create this action plan to give people three actionable steps that they can take when they’re done with this episode.

Robert Leonard (48:19):
So the first question gives listeners something to implement in their life. The second question gives them a resource to go learn from. And the third one gives us a specific action item to take right now. So the first question is which habit or principle do you follow in your life that it has had a big impact on your success that not enough people do but should?

Josh Miller (48:39):
It’s staying in my lane. Doing what I am good at and sticking to what I’m good at and hiring for everything else or outsourcing it for everything else. So, like I mentioned before, I’ve only talked to two homeowners my entire career, because I’m not good at sales, and I’m not good at the whole rapport and everything else that’s needed. So that was my first hire. So I guess I would say figure out what you’re good at and then stick with that and outsource the rest.

Robert Leonard (49:07):
What has been the most influential book in your life? And it doesn’t necessarily have to be your favorite because I know there can be a difference between favorite and influential. So what has had the most impact on you?

Josh Miller (49:18):
Two books, both for the same concept. The first is Traction by Gino Wickman. And then the second, it just came out, so, unfortunately, I didn’t have it before, but everyone listening has it, is Who Not How by Dan Sullivan. Both of these books stressed the same thing, which is, that’s what I just mentioned, which is figuring out what you’re good at and hire out for the rest.

Josh Miller (49:40):
And, really, the Who Not How by Dan Sullivan, it constantly talks about and it’s like the title says, “Don’t figure out how to do something.” If you’re trying to figure out how to do something, you’re asking the wrong question. Figure out who can do it for you. So I didn’t realize that’s what I was asking at the beginning when I started doing the hiring. But it was. And now as I have a marketing company, I realized like, “I don’t need to figure out how to figure out this new marketing strategy.” I just need to figure out who to bring on to implement that.

Robert Leonard (50:10):
The author of Traction, Gino Wickman. He’s great. We actually had them here on Millennial Investing back on episode 10. So for anybody that’s interested in learning a bit more about Traction, we talked about that book. We talked about his other new book that he had at the time. So if anybody’s interested in learning a bit more from Gino, you could definitely check out episode 10. When this episode’s over, before the listener quickly jumps to the next episode queued up in their podcast player, what is one action they should take from this episode that can help them improve their life, career, or business?

Josh Miller (50:40):
It all starts with confidence. You can’t accomplish anything without the confidence. That it’s 100% going to work. So back to all your questions about when to know to quit your job and all this other stuff, it really came down to 100% confidence that I knew I could make this work and make money. So if you don’t have the confidence, get the confidence right now that you need to whatever business venture you’re going down. Everything and anything will work. But you have to have the confidence knowing that it will work. So, yeah, that’s what I would recommend.

Robert Leonard (51:15):
Before we give a handoff to where people can find you, I like to wrap up the show by turning the tables for a second and letting the guests actually ask me a question. So Josh, what question do you have for me?

Josh Miller (51:26):
I would love to know why you chose to be a podcast host. Why this? There are a hundred different careers you could have chosen besides being able to talk to Gino Wickman. Why did you choose to do this career?

Robert Leonard (51:41):
So I don’t know if I’d say I chose it. I think almost it chose me in a way. So my goal and dream really growing up was actually to work at a hedge fund. And that ended up ultimately not working out for me. And so I ended up really getting into podcasting as a listener myself. And my favorite show back when I first got started in listening to podcasts was a show called We Study Billionaires. It’s part of TIP, The Investor’s Podcast.

Robert Leonard (52:06):
And so I just really love the brand of TIP, and they had an opportunity to work with them, to launch a podcast. And so I wasn’t really looking to have a podcast or anything like that. But I really wanted to work with the company and the guys that founded it, Preston and Stig, they seemed awesome from the show. So I wanted to work with them.

Robert Leonard (52:28):
And so if you had told me five, six years ago that as I’m entering college, before I got my MBA and all of that, that I’d be speaking into a mic as my job and obviously buy real estate and stuff too. But my main gig, if you will, is podcasting. I would have thought you were crazy. And so I don’t think it was deliberate. I don’t think I really chose it on purpose. It was just kind of how things have just kind of played out, to be completely honest.

Josh Miller (52:50):
That’s awesome. Have you seen Steve Jobs on a commencement speech at Stanford?

Robert Leonard (52:56):
I have. I need to go back and listen to it because I really like it. But I haven’t heard it for a while. But I have heard it a couple of times.

Josh Miller (53:03):
Yeah. It’s really cool. Definitely recommend everybody go on listening to that. And, yeah, he speaks a lot about looking back. It’s kind of obvious. It’s like why things. But you have to be able to look back. You can’t really plan and going forward. So kind of really that reminded me of when we were talking. That’s really cool. Thanks.

Robert Leonard (53:19):
Yeah. People will say you can connect the dots looking backwards. But you obviously can’t going forward. Where can the audience go to connect with you, find you on the internet, learn more about what you got going on?

Josh Miller (53:30):
Yeah, so goforclose.com is really where my heart and my passion is right now. It’s a marketing agency for real estate investors where the sole purpose of it is it takes a lot of work to really find these distressed homeowners. So our goal is to do all that work for you so that you can focus on the sales and other things. So yeah, goforclose.com is where you can find me. We also have a ton of resources there on how to find the right zip code. And everything is free so that you can really just dive in and get going. So, yeah, I love connecting with investors. That’s really, I feel like, the quickest, not the quickest, but it’s a good way to create wealth. And so helping others achieve that is really where I’m at right now. So yeah, goforclose.com is the best place to reach me out.

Robert Leonard (54:18):
I’ll be sure to put a link to that website below in the show notes for anybody that’s interested in checking it out. Josh, thanks so much for joining me.

Josh Miller (54:25):
Awesome, man. I really appreciate you having me on. And yeah, looking forward to listening to more of your episodes coming out. So, thanks and keep it up.

Robert Leonard (54:33):
All right, guys. That’s all I had for this week’s episode of Real Estate Investing. I’ll see you again next week.

Outro (54:38):
Thank you for listening to TIP. Make sure to subscribe to We Study Billionaires by The Investor’s Podcast Network. Every Wednesday, we teach you about Bitcoin. And every Saturday, we study billionaires and the financial markets. To access our show notes, transcripts, or courses, go to theinvestorspodcast.com. This show is for entertainment purposes only. Before making any decision, consult a professional. This show is copyrighted by The Investor’s Podcast Network. Written permission must be granted before syndication or rebroadcasting.