Mike: Alright guys, welcome back to the Discount Property Investor podcast, your host Mike Slane, joined with co-host Mister David Dodge! How are you, Dave?

David: Hey Mike, I'm good, buddy, I'm doing great!

Mike: Good, good man yeah.

David Yeah.

Mike: It's-- it's nice to get a little sense of normalcy. You know, get some podcasts recorded. I know we went and looked at some houses today, together and separately. It just feels good to , to keep doing what we like to do which is-- ya know, playing real estate so--.

David: That's right!

Mike: Yeah and then the Spring is springing so it's hard to not be happy when we've got a little bit more sunshine. I know I'm happy about that. I love uh, I love Spring, it's probably one of my favorite seasons. Everything coming to life. So what’s good in your world, man? What's good?

David: Ya know - uh, just trying to find some properties to buy. It feels like it's bin forever since I've bought something, it's really only been-- ya know, a couple of weeks but-- I need to buy some properties. So we went out on an appointment this morning, but that particular property just needed way too much work. We're not really looking for flips right now, we're looking for rentals so that one just isn't gonna work, but er - Yeah man, hitting--.

Mike: Let's talk--

David: - hitting the phones hard!

Mike: Let's talk a little bit about how our buying criteria has changed too, just in a wake of this uh, this whole thing. I feel like, and I don't know if I'm embarrassed to say it or, I'm, I'm shy to say, but I feel like we have gotten a lot more conservative in what we're trying to buy. And I dunno if that's a, err something to be embarrassed about, or something to be proud of the fact that we are, ya know, being prudent in this market--yeah ya know just--

David: Well -!

Mike: --the reality of it.

David: – so, you know, today is err, basically like, what, day 31 or 32 since they --

Mike: Yeah, something like that--

David: -- did the travel ban? Think it’s been about a month since the --

Mike: Mmmhmm --

David: – travel ban. So we're not-- we're not that far into this thing yet. So the city of St Louis where Mike and I live, came out today and we've recorded this on the 16th of April, and they came out and said it's gonna be another month of stay at home order. And they're gonna review it mid-May and that’s just to review, that's not to open mid-May. So, yeah, I mean there’s just a lot of uncertainty in the marketplace still that's, that's for sure. By the time this episode airs, I'd imagine it's probably gonna be 12 to 14 days. Uh, will be late April and we will still be under staying at home here in St Louis, Missouri. Crazy. So -

Mike: What – yeah, well I guess I, I go back and forth working between trying to remain optimistic. But also being realistic about the situation. And, yeah, I mean I've always been more of a-- I've considered myself more of a realist sometimes people call me a pessimist, but uh - yeah it's uh - It's a weird, weird world we're living in. So again we are more conservative and that's the way I'm gonna say it or phrase it, we're just more conservative right now with our rental purchases. And I don't think that's necessarily a bad thing, so, that’s where we're at, what we are excited to talk about, or at least I'm super excited to talk about is the course we are releasing. So, we've been pushing our free wholesale course for, gosh Dave, as long as I can remember. We've always had-- I mean since we've been podcasting together I feel like we've had that free course put together, haven't we? I think we have. I think we've had thousands--.

David: Yeah, I think we knew each other for maybe 6 months before we started working on it man. It's--.

Mike: Yeah, but we've had thousands of people take that, uh lots of good feedback and yeah, I think it's just uh pretty, pretty exciting um, to have another free course that we're gonna be putting together right?

David: Yeah. Yup -

Mike: Yeah so, what we've got, and it's, it's live today if you go out and check out our new course, it's called "FreeLandlordCourse.com". Yeah, that's right guys we were real original "FreeLandlordCourse.com" this time, but this one's really cool, so this is on our BRRRR Stuff on our BRRRR Strategy Method of acquiring rentals. So you can find all this info our there but we like to put everything together, in a comprehensive free course, just because we, again, we like easy. One of our companies is called "House Sold Easy", we like the easy button, we like that whole concept. So--

David: We do. We like to keep it easy. Mike, this course that you put together is awesome man!

Mike: Yeah, it's pretty slick man, it's pretty slick, again and and I couldn't have done it without ya, Dave. Obviously, you know we build off each other’s stuff and, and this one is-- ya know-- hopefully, hopefully gonna be a good complimentary companion to our, our free series of courses ya know, it kinda looks like that's what we're gonna be doing here, is giving out free courses. So, the "FreeLandlordCourse.com", that's "FreeLandlordCourse.com" guys check it out. We'd love to have some feedback, so we can edit that before we really do a strong marketing push on it, ya know, trying to get-- get other people in there. And hopefully give 'em some good, some good content.

One of THE most powerful tools in there Dave, and it's my favorite, because I was, it was just out of necessity in our business, we were buying houses left and right. And we were trying to figure out a good way to describe if something was a good rental for us, right? So we came up with a little spreadsheet and we refer to it as the "Rental Metric Analyzer" or the "Rental Analyzer", and it's very, very, very simple. You literally just have to put in about four numbers and it pops up color coded whether or not that's going to be a good rental for us, based on our criteria. So in the course we're giving that away for absolutely free, it's a Google spreadsheet, or a Google doc, that you will be able to click and download and create a copy of your own so that you can have that and use that, just like we do in our business.  Let's go ahead and I'm gonna pull it up so I can describe it a little bit better -

David: Yeah! Pull it up and lets-- let's take a look at it if you're watching this on YouTube, you'll be able to see Mike doing this in real-time and if not, we'll do our best to describe what we're-- what we're looking at here. If you're listening to this. But this analyzer that we are sharing with everyone, we're all essentially for free is what Mike and I use in our own business to analyze our own rental properties. So, if we're ever gonna be buying something, we run it through this analyzer right here, and-- Mike it's awesome that we're sharing this with the world, this is cool.

Mike: What screen am I sharing? I don't even think I'm sharing the right one here--.

David: I can see your M.L.S--.

Mike: Yeah, I mean-- kill that and try that again. 'Share screen' and desktop too this time. So let's click "Share". Okay--.

David: There we go! Now your screen's bigger there, there we go.

Mike: There we go. Yeah so now we should see the free course. You got my smiling face there. So you can go ahead and go in and create a free access so basically just put your name and email in there. And then you're gonna get into the free course and if you scroll down so we've got the lessons up top and then you kinda scroll down. And right here in the middle of the screen it says "Download your Copy" and that is the Rental Analyzer. So we've got a little video of that actually describes and walks you through how to use it, but we're gonna go ahead and do that again. So, you click that and then it prompts you to "Make a copy" of the analyzer. And, it looks like we're waiting on Google docs –.

David: Oww that's, that's really cool, that's really cool so if we edit it, it it it updates that too, that’s great--.

Mike: Exactly! So I've got this one, this is kinda the master, it's called the Rental Metric one that's save on my Google drive –.

David: Mmmhmm -

Mike: But then when people go out there to grab this, they're keeping a copy for themselves.

David: Yeah.

Mike: So then they can edit it, other people don't see it, and yeah that way they've always got it. Th- Also, if I ever need to make a change to this, it will do that. So okay, so here on this sheet you can see we've got, uh columns on the left that are labeled, starting with "Purchase Price" and it goes all the way down to "Expected Equity Capture", there's about 20 different rows here. And the first four are really the only four that we'd need to fill out to figure out if we have a rental property that's gonna meet our criteria. Super simple.

David: Mmmhmm -

Mike: So, we've got an example here, let's go ahead and delete these out Dave and let's take a look at-- one of the properties we looked at today. I don't remember the name of the street. Let's call it - I think it was called Wengler. And it was here in Overland, so obviously 'Wengler, 63114'. So the purchase price was going to be 55,000, we estimated it was gonna need about $40,000 worth of work, so it's a pretty big project. And the property value when we're done, lets call it 110,000. Uh, monthly rent for something like this-- this is a weird one and part of the reason we're gonna pass on this is because it was a strange property, so we're just not super interested in it. But the rent, let's call it-- let's say it was a good, solid property, it would be $1,200 per month. So this is estimated monthly rent. So I fill out these 4 fields and then if I look down to the bottom, I see my Expected Cash in Property, my Expected Cash Flow per Month and my Expected Equity Capture, and you say "How does it do that?". Well, we've got in the back here, there are hidden rows, we've got a mortgage calculation happening. So you can see and you can edit if you guys have different variables because again, mortgages are very-- they change from person to person based on the Interest Rate, based on the Amortization schedule - and you can alter all those things as well. So, we are figuring this on 5.25% Interest Rate, but you-- in a 20-year Amortization schedule-- you can change all this stuff. Um - so yeah, I mean that's pretty much it, let's see here, so this one, I've got one red column in my Expected Cash in the Property. It's saying I'm gonna leave $16,000 in the property, that's not good-- but it's saying I'm on a Cash Flow of $300 per month and I'm gonna capture about 27,000 in Equity. So, how would I play around with this Dave? What I would do, because I don't wanna leave $16,000 in this property, I would figure out my Loan to REF! So no we're only taking 75% of the loan and I would up that to 80% and that's about the most the banks are gonna let you take. And now we're still leaving $11,000 in the property. Well, there's only two things we can do to make these numbers work better. We can either, when we're purchasing it, we can negotiate with that seller a lower price, or we can trim our Rehab budget down. And hopefully we can make that work. So again--.

David: I'd prefer to lower the purchase price -

Mike: Same! So let’s go ahead and lower that to 45, and then we are much, much closer to something that's gonna work.

David: I like how the-- it's color coordinated, so if you guys are listening to this, this sheet is really cool. So, there's only four fields that you can essentially add your data to. There's some fixed fields in there and there's a couple fields that you can, again modify if you needed to, but once you set those fields they're pretty much, ya know, you pretty much leave them alone. But at the bottom, once everything calculates out,  it's it's actually gonna color co-ordinate it by either being green, yellow or red. And it looks like Mikey might even have and orange in there too, which is great. So what you're looking for though, is everything in the green and the targets that we have are actually stated on the Excel sheet here. So, in order to get a Equity capture in the green, we're shooting for a target of twenty grand. So if you guys have a target of, let’s say, 50 you can modify the sheet once you get it. So we have an expected Cash Flow of 300 at a minimum, so if it comes in at 100 its gonna be red and if it comes in as maybe 200 or 250, it'll be yellow because it's gonna be close, right? But if it's 300 or above it's gonna be green so, this thing is so great because you can throw your numbers in there and then if everything's green it doesn't even really matter what the numbers are, you've already pre-programmed it to ONLY be green AT or ABOVE those numbers. So if you fill everything out, and you got 3 greens that is a go! Alright, how simple is that? This takes the emotion out of buying properties, right? Whenever you are a new investor and you go and buy rental properties, you know you're typically gonna only buy the ones you really, really like right? When if you're aggressively growing, you have to take the emotion out of the property, right? Now obviously we don't buy junky junky properties, but if the numbers work, we will buy it. So, Mike just adjusted it and he got um--.

Mike: Yeah, just playing around--.

David: – all in the green. He played around with it a little bit, he got it all in the green. Mike I'm gonna let you explain what you did, but I can tell you right now that everything is green, it's at or above our target minimums, so that's awesome.

Mike: Right, so what we needed to do in this one was that we had to come down on purchase price a little bit more. So I just came from 45,000 I dropped it down another $2,500, so our purchase price assumption was 42,500. We're still gonna spend $40,000 on a rehab. We're spending almost the same amount as we are buying it. That's kind of a red flag, guys. We don't like to spend that much money on a property that we're doing for rental. The same amount that we're buying it for, that's  just a big rehab for a rental. Cut the property value-- oh no I upped it to 120, so again, we're gonna need a nice finish to make sure that that works, we're gonna have to look at our comps and justify that. And then I upped the rent to 1,250 and again we're just gonna have to try to push for a little bit higher rent by making it a little bit nicer, so that's how we would adjust those numbers. But Dave, I love what you said, is that when you're newer, sometimes you tend to buy on emotion and this takes the emotion out of it. And I think that's a really, really powerful  thing to-- to keep in mind or to use. Use a tool like this to remove that emotion. Because real estate is an emotional thing, people fall in love with houses and "oh its my 'dream' home" .Well when it's rentals, you don't-- you don't wanna think like that. You want a nice rental, obviously you want kinda cookie cutters stuff that's gonna be easy to fix and that someone else is going to like to live in. But it is not an emotional endeavor, it should be more on the numbers and again this really does help you do that, so really, really can be a powerful tool. Like I said, we've used it to buy hundreds of rentals, that we've either purchased for ourselves or we've purchased and fixed up a little bit and then sold as turn-keys, or that we've just wholesaled. Again if it worked for our rental numbers and we've said "Ah let's go ahead and see if we can wholesale it" we'll go ahead and wholesale it. So we've used this spreadsheet to buy, I mean, hundreds of properties. So it is, it is really, really a powerful tool. You guys need to check out FreeLandlordCourse.com and you can take a look at this spreadsheet.

David: Nice Mike!! FreeLandlordCourse.com. Man that goes really nicely with FreeWholesaleCourse.com and we've also recently just added FreeWholesaleBlueprint.com, so we have some awesome, free content for you guys. Again, go to FreeLandlordCourse.com, check out this free property analyzer tool that we have put together and have shared with you. We have used this to buy hundreds of properties and it helps us analyze the ones we wanna keep and or how to even make offers. You can kinda work this sheet in reverse to figure out what your offer needs to be to get everything in the green, right? So take the emotion out of buying, use  a sheet, we offer one that we're giving away for free, but regardless you should be using something to help remove the emotion. This is a numbers business; this is a numbers game you need to use those numbers. So guys, check it out, FreeLandlordCourse.com, we literally are launching this to-day. We're in mid-April by the time this comes out,  the course will be, you know, a week or two old so it's brand new, and  we will be adding to it as time goes on to make this just like the free wholesale course. It's gonna be the best, free course that is out on the internet. That is the goal. Mike, any departing or parting words, my man?

Mike: No, you know, I think that I'm just really excited that we launched this one. Uh, we, we are working on a book too so we're gonna have that coming out for you guys as well--

David: Oww! I forgot about the book!

Mike: Yeah, the BRRRR book, so that'd be cool, our second book. And yeah just try to stay positive, keep keep your routines and keep working and we're all gonna get through this together guys. Keep on investing.

David: You got it guys. Signing off, until next time. Talk to you then.