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Podcast Transcription
Dave Dubeau [00:00:09] Everyone, this Dave Dubeau with another episode of the property Profits Real Estate podcast today zooming in all the way from beautiful Toronto, Canada. We’ve got Mr. Van Sturgeon that how are you doing today?
Van Sturgeon [00:00:21] I’m doing very well, Dave. Thank you very much for having me on your show. As we talked about, I’ve been a long admirer of you, and so I really appreciate the opportunity to hook up with you and have a chit chat.
Dave Dubeau [00:00:31] I think it’s going to be a lot of fun because you guys then is a very, very experienced real estate entrepreneur who’s been in the game for over 30 years. I think like myself and he kind of grew up in and around real estate. If I’m not mistaken, your family bought an apartment building when you’re a young fella and you had to go through the whole, well, I won’t take away your son or your daughter’s story here in a minute, but you’ve been in a real estate for a long time over 30 years, actively involved in it. And what I’m really looking forward to chatting with you about is you’re very good at the whole renovation side of things and that really kind of become your calling as helping dunder heads like me that have two left hands to, you know, too many thumbs. Not enough, you know, mechanical talent to basically do anything ourselves, how to get our houses renovated without getting completely raked by renovation work. So we’re looking forward to chatting with you about that. But first of all, how did you? Because it gives us a very kind of an interesting niche. How did you discover that there are, you know, more than one guy like me or gal out there, real estate entrepreneur, investor who doesn’t have a clue about renovations and who gets taken to town by contractors every once in a while?
Van Sturgeon [00:01:47] Well, you know, I just kind of stumbled on this. I have a number of successful businesses. I’ve got a number of vestment properties all across North America, and I’m sort of in that semi-retirement stage of my life trying to stop and smell the roses because, you know, when you get up caught up in a number of businesses and it’s amazing how time can pass when you’re having fun, then you know, obviously the trials and tribulations of entrepreneurship. So I sort of hit the pause button and I started getting bored with myself. And then because I’ve always been on the go, as always, drew throughout the years about the occasion. Get a phone call from friends, family, neighbors of people wanting help on their rehab renovation of their property. And so I got that phone call and, you know, when I was really looking for something to do in my life and then one thing to another, I help the folks out there really happy with the results. They saved a lot of money and it really, I appreciated how I empowered them. They’re able to overcome this huge fear of taking on a task because, as you well know, in order to able to renovate a property, you actually have to decrease the value in order to increase. It is such a twisty, ironic kind of thing where you got to beat it up in order to build it up to increase the value. And that’s a pretty and you’re dealing with thousands of dollars, and a lot of people have got hesitation over that whole process. So that’s how guys got somebody started on this whirlwind course of helping people out. And I truly feel blessed then and being a help being able to help people out. And I really enjoy the process. Awesome.
Dave Dubeau [00:03:19] Awesome. So then how do we condense 30 years of in the trenches experience and do about a one minute little overview of your experience in real estate investing? And then we’ll jump in and start talking a little bit more specifically about rehabs?
Van Sturgeon [00:03:34] Sure. Ultimately, like I think the biggest, if there’s one single thing that I advocate for people to do is actually creating a scope of work. I own several businesses and construction or renovation when I come across a commercial renovation. It is very specific. There’s a scope of work, a document and every single aspect of the actual process is identified within that document. I find that in the residential side, which isn’t the case, and that’s where it leads to a lot of discrepancy, a lot of issue and a lot of problems associated with the because you have contractors are bidding on apples and some bidding on bananas, and there aren’t any established timelines. So what I think is really critical is the establishment of an actual document that’s called the scope of work that can be given to every contractor. So you have a good comparison of quotes and then you also hold people accountable because I’ve had a very good thing itemized within that contract within that actual scope of work. So that’s the number one thing that I find fault because on the commercial side, you don’t see that issue.
Dave Dubeau [00:04:43] OK, so let’s say, you know, it’s so he’s listening to this what I call a mom and pop investor. They go one or two properties on their belt, maybe. And you know, they’re still punching a clock. They’ve got a family, they’ve got kids to take care of, and they’re getting into their first flip or their first br, their first major rehab. How the heck do they even wade into that whole thing? Starting from zero. So we understand the importance of a scope of work. Sounds good, right? But again, you got if you took away the 30 years of hard earned experience you got here, you start from scratch. How do you even get started with all of that?
Van Sturgeon [00:05:23] Well, there is a process that folks that I if I’m involved, I take them through that process by establishing goals and identifying exactly what it is I look at just to do with the property. Then you move on to creating, establishing a budget, understanding how much money that is to be used for this project. And then you go through an actual list of needs and wants identifying things that have to be done in the property to reach your goal. And then you have to list the wants side of that list. You know, things like green carpet might be something that might be egregious to you and me. But if it’s still functional starts a trip hazard that’s sometimes, you know, must consider a want. So that in order versus, let’s say, if it’s a broken window or if a loop is the roof is leaking, then those are things that should be identified under the need. There’s so many times that I find new real estate investors will go into replacing windows. Now that doesn’t necessarily you don’t necessarily need to replace windows. If they’re functional, they block out most of the cold. There’s other things within the actual home. If you’re looking to flip it, for example, if you’re looking to rent it, there’s other things that can be done with those precious dollars that you have in your budget that can maximize your investment, maximize the amount of money that you can get from the rental, then making an investment in the capital improvement like windows. So that’s one of the things that I find a lot of people rush into that are new into the game. They don’t understand that you need to prioritize certain things, and that’s what again leads to the next step. Broaden the scope of work because then you have you’ve got everything nailed down and you stick to that document. And when people don’t have a document and start written down, goals are written down. Then we start to scattered. And all of a sudden, what’s a couple of hundred dollars for that toilet? Or, you know, a couple of hundred dollars for that granite top? And all of a sudden, the budget that was fifty thousand turns in the seventy five. So those are hopefully I answered a question. But there’s also
Dave Dubeau [00:07:21] actually a second question, and I don’t want to put you on the spot here now. But you know, I want to take a look at people that are rehabbing a house for a flip. And then let’s switch gears, and let’s take a look at people that are rehabbing a house for a burger, for example. So let’s take a look at a flip in and off the top of your head. What would you say are the top two or three things that get you the biggest bang for your buck when it comes to taking a house and fixing it up and reselling it again? So where should we be focusing our rehab dollars when we’re doing for?
Van Sturgeon [00:08:00] Dave Curb appeal is so huge and it gives you the biggest bang for your buck. I love walking into properties that have the grass is all beat up and you got bushes and trees covering it. They are escaping needs to be improved. Those are the dollars that people should really start to concentrate first, because that gives you the biggest role. I landscaping definitely is the number one thing that I find often overlooked. People might assume, Oh, we’ve got to get into the kitchens and the bathrooms in the US. They are important, but they’re awfully expensive, too. Yeah. If you want to get the best bang for your buck on a limited budget, those are the areas that I would look at landscaping. So that can involve retyping of driveway painting the garage doors, doing some cleaner to clean up the hedges. Very inexpensive things that all of a sudden increases dramatically increases a curb appeal. And it’s human instinct. There’s an old saying you can’t sell the steak without the sizzle. You need the sizzle. You need to see when you drive up that our house, you need to have that feeling that, Oh, I want to live in that house. And that’s a powerful, powerful sentiment or feeling that you get when you walk into your property and that maybe the kitchen might not be so good at bathroom. But just looking at that house from afar, from the curb and you saying, wow, it drives is so valuable in terms of being able to make a sale. That’s what I’ve been called.
Dave Dubeau [00:09:26] So we got curb appeal. That makes sense. Playing devil’s advocate. OK, let’s say it’s wintertime in Winnipeg.
Van Sturgeon [00:09:32] OK, fair enough in Toronto.
Dave Dubeau [00:09:34] Yes, there’s two and a half feet of snow on the ground there, really everywhere and see a much curb, let alone backyard. Now what about inside? What would you say for doing a flip would be your first area of focus once you get inside the door?
Van Sturgeon [00:09:48] Well, again, every case is unique, but there’s so many situations where again, you can get by with a lot, with the least amount of money. So resurfacing cabinets, I don’t necessarily run out and just run out, replace all the kitchen cabinetry, maybe resurface just the doors and the bathroom. There’s so many. There’s different technologies that exist at. You can resurface the tub in the tiled surround that all of a sudden brightens up the area. Just the lease of one of the most least expensive things that you can do, which I find improves things dramatically, just increase the wattage on a light bulb in a particular room. Walking in so many places that I’ve been to and I’ve been that I’ve done. I don’t know how many thousands of renovations from apartment buildings are never there. So many times when you just increase the lighting in a room, how it can dramatically affect the room, it brightens it, obviously, but it creates more openness. It creates it just gives you a better feeling for this place. Never mind if I had a coat of paint, but just something as inexpensive as just increasing the lighting can be dramatic.
Dave Dubeau [00:10:53] OK, cool. So there are some really good suggestions on if you’re doing a flip. Now, let’s switch gears. Let’s say we’re buying the property, we’re doing the whole bird strategy to a single family, all putting in a basement suite, for example. Where do you where do you think we’ve got the biggest opportunities in that kind of a situation? I mean, obviously we’re putting in the secondary suites, so that’s getting two rental units instead of one, right? And that whole process that you see people making a lot of mistakes on where they really get a much better bang for their buck.
Van Sturgeon [00:11:25] Well, on the renovation side, there’s a number of things that people can do to again, I strongly encourage people in this business. If you really want to be active in this business, you need to be. You need to act as your own general contractor and not hiring a general contractor because me being a general contractor myself, I in situations where a project is fifty thousand two hundred thousand, my profit margin or something like that would be somewhere around 30 percent. And so that stuff is a huge savings, so strongly encourage people if you really want to get into this because you need to handle that. Also the same time. By doing a renovation yourself and handling that aspect, it teaches you a new skill set, it’s a skill set that you can use them when you can purchase your second, third, fifth property, that you can then evaluate your property. It teaches you how to look at something walking in and being able to say, OK, well, it’s going to cost X amount of dollars for this or that. I don’t have to do this. Maybe I have to do that. And that’s a skill set that you need to be. You need to go through the grind in order to be able to develop. And I see a lot of people can save a lot of money. My cholesterol attrition may be similar to yours, but just by the fact of me not hiring a general contractor is a huge saving if I can internalize and handle the planning and management of the renovation myself. So that’s what I encourage in terms of that aspect. There’s a lot of things that you can do when you’re doing a basement conversion that you could save a couple of dollars here and there, but the totality of the work. I strongly encourage people to learn how to do properly their own renovation themselves internally and not hire general contractors. A lot of people run the general contractor.
Dave Dubeau [00:13:08] They pick it up the hammer and no,
Van Sturgeon [00:13:10] no, no, no. Oh, I’m sorry. You know, I want to be clear, I don’t want people. Thank goodness a camera’s not very clear, but I have scars all over my body from doing my own work. I’ve done everything. I’ve slept at job sites, clean toilets, all those good things. I don’t encourage people to do that. Their professions are people that are that you hire for every single aspect. What I’m suggesting is that people need to learn how to plan and manage your renovations that are efficient. And all they do is just walk in, make sure everything’s being done and you save money. You save a lot of money because you’re
Dave Dubeau [00:13:41] hiring somebody at 30 percent. That’s you. All right. So that time flies. We’re having fun. One last question, then we’ll let people know how to find out more about you. Any quick tips on finding good contractors? Because when it comes in comes this whole thing. You know, nightmare stories about real estate investing. We always hear about tenant or nightmare tenants from hell. The second thing we hear are nightmare contractors from hell. Just, you know, dragging people through the muck and doing a terrible job and overcharging and all that kind of good stuff. Bad stuff. Any suggestions for somebody that’s just getting into this? They’re going to do their first Reno, the first rehab, whatever they want to be their own, they’re going to take your advice, be their own general contractor. How do they find good contractors in their local area?
Van Sturgeon [00:14:32] There’s a number of great sources to be able to find contractors. Number one, friends, family, close associates, your lawyer, your real estate, agent, salesperson, mortgage broker. These are all great services for people that they frequent in their power circles of the painter, the electrician, what have you? That’s the I that would be the first source. Second, there’s a lot of great groups out there and you have them as well part of Facebook outreaches, things of that nature that if you’re really serious in the game that you need to be involved in that and there are great sources for individuals to be able to hand over to you that are vetted that say, Yes, this Latricia is great. That plumber is great. I first great. Those are the places that I strongly encourage people to get involved. And then also it acts as sort of like your own social group and crutch to be able to bounce ideas off of and try to get more information. Information is powerful. Its key is just fortunate that the internet, as you all know, is full of a lot of nonsense information out there, too. But hopefully those two areas will be able to provide you with the quality contractors you get with it.
Dave Dubeau [00:15:41] Get good references that you know from people that you know, that have actually. Absolutely. Yeah, that’s awesome. And this has been great. If people want to find out more about you and how they can tap into your 30 plus years of experience, especially when it comes to rentals, what should they do?
Van Sturgeon [00:15:57] Well, I encourage everybody to if they want to learn more to go over to my website advanced sturgeon dot com. I am offering a free training that people can click on and watch. They’ll walk them through the process of what you know, the things that you should be aware of when you’re planning and managing your own renovation. It’s also raised area for source of information. In terms of there’s a number of articles have been posted, links things out in nature. So I encourage people to go there and yeah, that’s it. And then if there’s need, anybody needs any help, they’re more remarkable to reach out to me. There’s a contact they share as well
Dave Dubeau [00:16:30] as very good. I spend a lot of fun. Thank you.
Van Sturgeon [00:16:33] Well, I appreciate the time. Take very much, Dave.
Dave Dubeau [00:16:36] All right. Take care. We’ll see you on the next episode. Bye. Well, hey there. Thanks for tuning into the property Profits podcast if you’d like this episode. That’s great. Please go ahead and subscribe on iTunes. Give us a good review. That’d be awesome. I appreciate that. And if you’re looking to attract investors and raise capital for your deals, then we invite you to get a complimentary copy of my newest book right back there. There it is the money. Partner formula, you’ve got a PDF version, an investor attraction book dot com again, investor attraction, book dot com. Take care.