Table of Contents - An Epic Moment In Real Estate Investing with Rochelle Laflamme and Alisa Thompson
Dave Debeau [00:00:08] Hey there, everyone, this is Dave Debeau with another episode of the Property Profits Real Estate podcast. And today it is a big treat for me to be interviewing these two lovely ladies coming all the way in from Saskatoon, Saskatchewan. So we've got Rochelle Islam and Lisa Thompson from EPIK Alliance. Ladies, how are you doing today?
Alissa Thompson [00:00:27] Good. Thanks for having us.
Dave Debeau [00:00:29] My pleasure. So we're filling we're doing this in the middle of February. Probably a little chilly in your neck of the woods.
Alissa Thompson [00:00:35] How an understatement.
Dave Debeau [00:00:40] So we won't talk about the weather. So, ladies, first of all, folks, if you're watching this, if you haven't seen these two, I highly recommend that you have the opportunity to listen to what we're going to talk about today. But this is a very inspirational success story when it comes to real estate investing, because these guys are rocking and rolling it in the real estate world. So I won't steal your thunder, you guys. So first of all, let's just get started with how the heck did you get involved in real estate investing in the first place and about how long have you been doing it for?
Alissa Thompson [00:01:08] Well, it's funny. It's a great story. We always joke. We like to say we met in prison and then everybody goes, what? What? Michelle and I are electrica. And in Saskatchewan you have to move either to a city called Prince Albert or Moosejaw, North or South. We went to Prince Albert. We were practicing in different years and would have never met. But we had an instructor come around that was looking for people to volunteer to speak to the inmates at the Pine Grove Penitentiary, the female inmates, about nontraditional work. I was like all for it because I got to my school and not get in trouble. Rochelle was like, hey, I just got back from personal growth and I'm supposed to serve and get back. Univers put us together. And next thing you know, we were working on a project together.
Dave Debeau [00:01:52] Nice. So, OK, so you start off. That's how you met that you start off working as electricians. How did you make the jump into becoming real estate investors? What did that journey look like?
Rochelle LaFlamme [00:02:03] It's been kind of the universe put out the steps and we just kind of took them. Right. So actually, right after our schooling, LSI helped me build a basement suite in my personal residence. And at that time we realized we worked so well together, which is amazing because I don't work well with people. It's been a rough journey. But anyway, so essentially then we found out about that real estate investing courses and then let's actually use our divorce money to pay for our forces, which is pretty incredible because we'd only known each other for about seven months at that point in time. And then we basically took eight of the courses in ten months. And yeah, pretty impressive considering we literally were like all over Canada taking these courses and had no money. And we were like like our our air miles. And it was quite the adventure. But again, how bad you want it, right? We want to do that. And then we ended up taking the courses, taking our freedom mentorship and getting our first clip and then getting incorporated. And the rest is history. It's just been like one thing after another. And we're very blessed with being aware that there are amazing opportunities and there's enough abundance out there for everybody. And yeah, I don't know, I feel very supported. And we just we're we're both really hard workers. And I always say, like other people might be smarter than me, but no one's going to outwork me.
Dave Debeau [00:03:21] Yeah, that goes so far, I tell you. Thank God hard work makes up for smarts. Otherwise, I
Rochelle LaFlamme [00:03:27] think
Alissa Thompson [00:03:27] the Saskatchewan was built on it was what
Dave Debeau [00:03:34] what do you focus on when I mean, because you took the education, the training. I'm sure you learned a whole swag of different real estate investment strategies. What is your bread and butter strategy that you focus on mostly?
Alissa Thompson [00:03:46] Well, the big overview is we position ourselves to be residential real estate problem solvers. Then we narrowed that down into basically working with buying homes
Dave Debeau [00:03:56] and of single family homes. Right. So basically, OK, so buy and hold and flip. So what is buy and hold look like for you? What what do you guys do with the properties that you buy then you for sure.
Rochelle LaFlamme [00:04:07] Well, the interesting thing is it's like to say we basically created our own economy because again, when you're flipping houses, you have to be subject to the way the market is. Right. And so when we first started, it made sense
Dave Debeau [00:04:20] to want a little bit, I would say would have something to do with it to
Rochelle LaFlamme [00:04:24] the well, I mean, a little bit. I mean, it's going to affect some of the outside stuff you do. But I mean, it's all relative, right? And you just take on your projects and be strategic about that. But even just the economy, like right now in Saskatoon, it's a buyer's market. But when we started five and a half years ago, it was a seller's market. So in a seller's market, it makes sense to flip in a buyer's market. That's when you buy, right. And you hold. So for us, we kind of learn from that and again, implemented what we learned in our education. And so what is very interesting, and this is how we create our own economy, if we actually take and buying distressed properties or distressed owners, we renovate the property to put it into a safe, sound, secure, cash flowing rental. Properties and then basically flip it into our real estate portfolio, where we share with investors to hold them long term. So essentially it's kind of like that be our best bet. But we use investors to do that, to acquire control of as much inventory as we possibly can.
Dave Debeau [00:05:23] Very, very cool. So that, you know, it's almost like a flip, but you flip it to yourselves with an investor partner, then you hold on to it long term. Exactly. You fold your cash out so you can go do that with another property or property.
Rochelle LaFlamme [00:05:36] So right now, we're using those profits to pay our overhead because we have a team of 30 to win. Our overhead is high again. It's because we're throwing everything back into the business to basically build our empire.
Dave Debeau [00:05:50] Yeah. So your team does consist primarily of contractors. You know, people out there fixing up the properties is up.
Alissa Thompson [00:05:58] It's about a I'd say 70 30 split. So 70 percent would be in the field working. And then the other 30 are data entry, admin, marketing, that kind of thing.
Dave Debeau [00:06:11] Got it. That makes a lot of sense. Well, so what is your if you don't mind sharing, what is your portfolio look like right now?
Rochelle LaFlamme [00:06:17] So when we first started in year one, we flipped one house. And our goal has always been to double our portfolio every year. Right. And we didn't know what stuff was going to happen along the way, but we just closed out twenty eighteen, controlling over thirty two million dollars worth of real estate. And I think we just again, we're figuring out and we're just cresting 40 million already.
Dave Debeau [00:06:37] Wow. Wow. That's that's impressive. So it's been a fast journey for you guys, but I'm sure you've learned a couple of lessons along the way.
Rochelle LaFlamme [00:06:45] So, yeah.
Dave Debeau [00:06:50] So knowing what you know now, if you were talking to your your earlier selves or if you had to start all over again from scratch somewhere else, what would you do differently?
Alissa Thompson [00:06:58] OK, one of the first things would be like putting together the team that's helping you would be a bookkeeper, bring in somebody to do your as a real estate investor, your great being an entrepreneur. You're great at seeing what the properties are, what you can do with them. You're not the greatest at the paperwork. And so why bang your head against the wall? Just bring somebody in. It's amazing at bookkeeping and you'll be able to go so much further. Don't try to wear too many hats. That was probably if we could change something, it would be that.
Dave Debeau [00:07:29] Yeah, well, that makes sense. Michelle, what about you? Do you have a another B?
Rochelle LaFlamme [00:07:33] I think my biggest takeaway is making sure that you align yourself with people who have the same morals and principles and integrity that you do.
Dave Debeau [00:07:41] So you're talking about your team members, talking about
Rochelle LaFlamme [00:07:44] everybody, like even if you're going to hire a contractor, make sure that they're on the same page with you. Right. If you're going to work with an investor, I mean, I abide by that in my day to day life as well. If you are not high vibe and forward thinking and living the positive way, I'm just you're not going to be part of my circle.
Dave Debeau [00:08:02] Yeah. Know very, very, very well set. So I know, ladies, you've started a real estate club in the past and your your own speaking and mixing, mingling around the country, showing people what you're up to. What are some of the biggest mistakes you see other real estate investors making, whether getting started or just in general? I mean, because you must see a lot.
Alissa Thompson [00:08:21] Absolutely.
Rochelle LaFlamme [00:08:22] So one of the big things that we're really trying to focus on right now is making people aware if they are truly wanting to be an active investor or more of a passive investor. Right. Because there's a lot of people out there who are reading books and they're watching TV shows now, like, I'm going to go flip a house. But then they're busy working their day to day jobs. They've got children at home and then they either lack of education or lack of time turns around and bite them in the butt. And we got a lot of people like this who come with half finished properties now, like, I'm sorry, I bought off more than I can chew. I don't know what to do with it. And unfortunately, when they're already elbow deep in a renovation and they pay too much for the property, there's nothing we can do right now.
Dave Debeau [00:09:00] They're going to lose money either way, right?
Alissa Thompson [00:09:02] I mean, and then coming for me, honestly, I think the biggest mistake we see happen constantly is emotion versus numbers. They're going to get in.
Dave Debeau [00:09:11] So what do you mean by that?
Alissa Thompson [00:09:13] They're going to look at something and they're going to jump on it based on emotion instead of really looking at the numbers and extrapolated about it.
Dave Debeau [00:09:20] Right. They see the house. They fall in love with it. That's right. I have that deal
Alissa Thompson [00:09:24] and we've only had one of those this year.
Rochelle LaFlamme [00:09:26] So there's a story I don't get emotional about anything like at all. I'm like, I'm sorry, you're probably died, but I feel like
Alissa Thompson [00:09:40] she has me. I care about
Dave Debeau [00:09:44] bad cop know, I get it.
Rochelle LaFlamme [00:09:45] Yeah. And so this year we actually went to look again. We look at houses every day. We don't look for properties anymore. People like to come to us by the dozen. We're getting rental portfolios showing up on our doorstep. It's great. But one of these houses I went to look at with an agent and it was crazy because this house was like another level special, like the person who live there was a. But the person who lived there was like so extra, I can't even explain all the stuff that is done on this house. So anyway, I was in love with this house, and it was like a blow price because the furnace is where there's no basements, crawlspace as a furnace, oil based furnace. It's really weird. Anyway, I was like, I don't care what we pay for this house,
Alissa Thompson [00:10:25] we're getting it.
Rochelle LaFlamme [00:10:26] And it was still a great deal. Even if we were have paid full list price, it would have still been a great deal. Don't get me wrong. But yeah. So this is like
Alissa Thompson [00:10:34] putting them in a house that I would like,
Rochelle LaFlamme [00:10:36] I think. And honestly, I would actually if this house was closer to our office, I would actually move into it. It is that extra.
Alissa Thompson [00:10:42] It's super eclectic. It's crazy.
Dave Debeau [00:10:48] OK, well, if you don't mind, kind of just so people get a better idea of what you do, can you kind of walk us through the process? Let's say somebody brings a property to you, if you don't mind. How do you how do you go through that process of deciding if it's a good deal or what's kind of your sweet spot as far as price that you're willing to pay and that sort of thing? So walking us through that process, OK,
Rochelle LaFlamme [00:11:10] so very politically correct.
Alissa Thompson [00:11:12] It depends on how
Dave Debeau [00:11:16] politically correct
Alissa Thompson [00:11:17] that you are. Right. So, no, honestly, it is house by house because there's so many variables we can look at due to how we run our epic economy so location can change things. The age of the house can change things. The size of the lot can change things. So there's all these variables we take into consideration and it's going to make it dependent on how much we will or won't pay for a property. So, for example, we just went and looked at a foreclosure yesterday. That's in saskatoons high end neighborhoods. Typically neighborhoods we don't touch. It's not we're not into the half a million or houses for flipping. It's just not our thing. But we got this one like this house, Kasota to set or four seventy or fifty finished and we got it for two eighty. So I mean, like, that's the kind of thing where it's like, well, it's not something we typically do, but the numbers are just so good. You would be silly to walk away.
Rochelle LaFlamme [00:12:13] And this one was interesting too, because again, we've got again, we don't look for property to us, but we had an agent who he's got a really close eye on the pulse. And we focus on three houses in the last month. So he's a grinder and he wants this commission. So I'm like, you go do the work and you bring us the stuff. And so we went to look at it and literally within an hour of him setting up the listing, there had already been five offers submitted. When we were walking out. There was another two people coming through. Right. So we again, not emotional. We're very logistic about how we go in and do the offers. So for us, our offers generally get accepted because we do all like no conditions, all cash flows. So usually we can close in as fast as five days because our lawyers are the bomb. And so, again, this is where it's really important to have a really strong power game and to know what you're doing. Right. And so we went in the list price on a house with two sixty, right. Again, we knew the comps. We knew we would have to put into it. So we actually listed two or three offered to eight, no conditions, all cash. And they weren't actually going to respond until Thursday. They said they're collecting all these offers and they'll get back to you on Thursday. We got a phone call, I think, what, three hours later if they accepted our offer.
Alissa Thompson [00:13:20] So we fixed what we figured would be low and we offered
Rochelle LaFlamme [00:13:30] and we never we never say that we never offer too much because we know what our numbers are. So for us and again, there probably was people who were people who offered more than us, but they probably had conditions and they probably had longer time lines and they probably had financing. Right.
Alissa Thompson [00:13:48] So the other point to it goes back to the power team and how valuable they are. The realtor we work with has great rapport. He deals and foreclosures basically. So his rapport with these banks, he goes in and says, these guys are going to close a period. End of story.
Dave Debeau [00:14:03] Yeah. Yeah, OK, well, that makes a lot of sense. So so that property, you're probably not you're just going to flip it. You're probably not going to hold as a rental private.
Alissa Thompson [00:14:10] No, that's a different
Dave Debeau [00:14:12] deal with a let's say whether you're your typical kind of a rental deal. We go in, you buy, you fix it up, then you bring an investor on board, you flip it back to yourself. How does that process work?
Rochelle LaFlamme [00:14:22] Typically, yeah. So we would get a phone call on a property, whether it's private, whether it's listed with an agent doesn't matter to us. Right. Because the numbers are the numbers. It is what it is. So basically, we'll go in, we'll look at the property, we'll run the numbers. We know what our houses rent for. If it's a two bedroom, one bathroom at rent for twelve hundred, doesn't matter if it's a five hundred square foot house or a thousand square foot house, how many beds and baths does it have? If it's got a decent square footage and we can add a bedroom like a legal bedroom. Right. So maybe we can put a window in the basement and get an extra bedroom. We've now just increased our profitability on that house by an extra two hundred, maybe a month for cash. So we run those numbers, right. So again, we pay two grand for an egress window that gets us an extra two hundred bucks a month. I mean, it pays for itself in a very short time, and so again, now we've got a four bedroom house, so it's going to pay higher when it's finished. So basically, we'll go in, we'll do an analysis and see what the renovation would need to be in order for us to make it safe and secure. And so I know some people, when they get into this, they have checklists and they go in and do all this crazy stuff. And honestly, it's in our heads and we just we look at hundreds of properties and we know like we go in two bathrooms, five brand new kitchen and enough paint, OK, three, I need new flooring. Like, it's very and
Alissa Thompson [00:15:38] part of that is our team. Right. Because we can hold to those numbers because it's in-house. We have our own plumbers, we have our own electricians, the changes, the game.
Rochelle LaFlamme [00:15:46] And then we would find out the numbers and then essentially we would go and make an offer on the property. And then again, if there's tenants in place, we need to make sure it's a longer possession because they need to get the tenants out or we could take the tenants over. Sometimes every deal is different, but we figure out what the house is worth and then eventually we would say it was a vacant property. So we put an offer on it. Then we would go out and find the investor who going to fund it for us, and then we would go and get the keys, send in our group. It needs to be renovated. If it doesn't need to be renovated, we just get the keys for our property management group, which is again in house, and then they go rent this property and then we would get it appraised after the renovations completed. And then that's how we get our price of what we sell it to our house, every landlord owner for. And then essentially, once it's financed through our house of the landlord owner, we become their guaranteed tenants. And then that's how our original cash investor gets their money back. And then they'll get paid for their principal and the accrued interest of how long their funds were used for. And then we'll say, hey, that was fine. Do you want to do it again? And usually they'll say for sure that was super easy.
Alissa Thompson [00:16:45] Hence the old economy, right?
Dave Debeau [00:16:47] Yeah, that makes sense. So as long as you come in as a tenant. So does that mean you find a subtenant, you're going to do a lease option type deal at the end there
Rochelle LaFlamme [00:16:55] so we don't actually do lease option. The properties we have are pure rental properties, but we are actually the rent to own tenants. As for our house landlord owners, but basically this is how we acquire control of all of our rental properties without ever having to put any cash or credit into the deal.
Dave Debeau [00:17:12] So you're guaranteeing them a tenant and then you're finding somebody else that you're subletting to basically incorrectly.
Rochelle LaFlamme [00:17:18] And then that's how we take all the risk away from our clients. So if there's a vacancy, we still have to pay rent. If the furnace goes up, we just go in and fix it.
Dave Debeau [00:17:25] Very nice. Very nice. Well, ladies, we've run out of time here today, but if people want to find out more about you guys or what you're up to, what's the best thing they can do?
Alissa Thompson [00:17:33] Probably check out our website, EPICA Alliance Inc dot com, and you'll find all the information you need right there. Or phone us, either one of us. My numbers, three oh six seven one seven three three five one.
Rochelle LaFlamme [00:17:46] And I'm three zero six seven one seven seven eight four eight. And I always have my
Dave Debeau [00:17:51] phone on task. Very, very interesting. I think we'll probably have to have you come back on another podcast in the future so we can talk about some more stuff, because seventeen minutes runs by pretty quick
Rochelle LaFlamme [00:18:00] word of thanks for your time.
Dave Debeau [00:18:04] Well, thanks very much for checking out the property profits podcast. And you like what we're doing here. Please head on over to iTunes, subscribe read us and leave us the review. He very, very much appreciated. And if you're looking to create a regular flow of inbound investor inquiries about your real estate deals, then I invite you to attend one of my upcoming live online demonstrations. And you can check that out at Investor Attraction Demo Dotcom. Take care.