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Rob Break [00:00:35] Well, hello and welcome once again, everybody, thanks for joining us again today for the Christmas edition of the podcast. Very might very well be the last show of 2021. But anyway, I’m here again, joined by Sandy MacKay How are you?
Sandy Mackay [00:00:55] Hey. Awesome. I love the Christmas edition. You got the tree gone in the background. It’s beautiful. I do.
Rob Break [00:01:00] We just got it up yesterday.
Sandy Mackay [00:01:01] So this was in Costa Rica. First one. Is there? Are you there like you’re close to Christmas?
Rob Break [00:01:08] and we came right after Christmas last year. OK, cool. Hmm. We’re excited. It’s going to be different. That’s for sure. Hmm.
Sandy Mackay [00:01:18] Yeah, it’s snowing where we are. Well, it’s there’s snow on the ground where we are. So and you’re missing that, I guess,
Rob Break [00:01:23] or avoiding it. Yeah, yeah. You know, and that being said, we are still my team and James Kennedy and everybody still doing lots of we’re very active in Peterborough and Durham, still helping investors there. So, you know. And James is actually still doing video tours every week, if not almost every day. He’s got new ones. So we’re sharing all that knowledge with investors still of maybe duplex conversions or student rentals, whichever replaces the property permits. And yeah, so I mean, we’re still doing that. So please reach out to me and we’ll get you in touch with James because there’s lots, there’s tons of opportunities there still. So especially in the student rental,
Sandy Mackay [00:02:14] it’s still one of the markets. Do rentals still on the market started in markets? Where is where people ask me in GTA is where it can be, where is it and where do the numbers make sense? That’s quote unquote affordable. Mm hmm. And yeah, exactly. Was pretty much at the top of the list. I would suggest it’s right up there with a small group of other areas.
Rob Break [00:02:37] We’re still doing lots. There’s still a ton of bidding wars and things like that going on there, too. So, you know, the market is definitely hot, but still good opportunities and Sandy when people when people say that to you, feel free to send them our way.
Sandy Mackay [00:02:51] I know, I know. Usually it depends on what they want. Sometimes they are our area for, like more west of Toronto. They are, you know, it’s a Brantford, maybe or Niagara or something. But if it’s if it’s more eastern east of the city of Toronto, at least, then yeah, Peterborough is as good as it gets, in my opinion.
Rob Break [00:03:12] And where are you guys focused right now? You’re away, Hamilton or Hamilton?
Sandy Mackay [00:03:18] As much as much as it’s a little bit more unaffordable, I suppose, depending on what your strategy is, right? There’s it’s a little harder to get into than it was five years ago, definitely 10 years ago. But it’s there’s still opportunities out there. There’s a lot of it. But again,
Rob Break [00:03:32] it’s just like a sort of a change up and in in the mindset, like a shift in what you’re going to do with the property. So Mike, who is on from your team, lost last episode, just says, you know, we’re just changing up the strategy a little bit to still continue to make it profitable, right?
Sandy Mackay [00:03:48] Yeah, I mean, the deal is a deal in any city, right? You can find great deals in Toronto. It’s not that they’re a little bit harder to find, probably, but it’s not like there’s no deals in Toronto or Vancouver or Montreal or any of these major cities where the numbers are getting tighter. From a cash flow perspective, there’s still opportunities. It depends on your strategy.
Rob Break [00:04:04] Mm hmm. Absolutely. Well, everybody listening. Please go over to our website, break through our podcast dossier. There, you can hook up with all of the past guests that we’ve had on the over hundred and fifty different guests that we’ve had on since we started. And you know, you can hook up with them there. You can also get our free gift.
Sandy Mackay [00:04:25] Yeah, the ultimate strategy for building wealth, the real estate’s and when you get that’s you’ll also, of course, learn about all of our other stuff we’ve got going on through our email newsletters and whatnot. And especially now, I think it’s more exciting than ever to get on those lists because you’ll end up hearing a lot more. We got a lot more exciting stuff in the works for twenty two. So it’s very timely to jump on the list here. But everything we got going on and never missed a show. More importantly,
Rob Break [00:04:51] yeah, never miss a show. Most of our, you know, we’ve got great listeners. Most of them are listening to every episode when they come out. And so we’re very appreciative of everyone who does that. Over on iTunes, which is also another place where you can listen to the show and where most people probably actually end up ultimately consuming it from, as is iTunes. And while you’re over there, you can write us a rating and review, please, that helps us out a lot. You know, it helps share this with more people that might have interest in what we’re talking about, and they’ll be able to find us and they’ll be able to get all this information. So, yeah, like it takes a couple of minutes, but eviscerating review and we appreciate it a lot. And I keep saying I’m going to read some of the reviews, which, OK, I will do that next time, but I going to while we have. But there’s actually we’ve had a suggestion, a couple of suggestions. So I’ll also get to those two next episode for just things that people want to hear about, actually. No one of the ones is deal analysis. Someone wants some more in-depth deal analysis just because of the situation that we’re in and because of what we were talking about earlier in the show. People are like, Well, if the numbers work and you know, somebody new says, well. How do I know if the numbers work, what am I looking for? Right? So maybe we can break that down with the future guests and the end and go over some of that?
Sandy Mackay [00:06:27] Yeah, we haven’t. I think we might have done that early on. We haven’t done that a bit for sure. I just got through some national details.
Rob Break [00:06:34] And again, it’s always evolving. It’s always changing. So. And everybody does it a little bit differently. And depending on what you’re investing in, it’s done differently. So, yeah, so we can start to maybe dig into that a little bit with some of the some of the future guests. And maybe we’ll get into a little bit today, even. With our guests, Chris Harlan, who’s here with us today.
Chris Herlin [00:06:56] Hey, guys, thank you for having me here today.
Rob Break [00:06:59] Yeah, I really appreciate you taking the time and you’re super early where you are. It’s just after 6:00 a.m. for you. Yes. In B.C.,
Chris Herlin [00:07:08] yes, six o’clock in the morning, I wake up at five. So it’s not a not a big, big change for me in daily routine.
Rob Break [00:07:16] Yeah. Which is great, though, because we do appreciate you accommodating our schedule here too with us. I think everyone’s got a lot going on, so we appreciate you being here.
Chris Herlin [00:07:25] Thank you. Appreciate you guys.
Sandy Mackay [00:07:27] Yeah, absolutely. I guess I have a quick bio for you, and then we’ll learn a lot more about your story. We’re excited to learn how you’ve gone from being living in Brazil, right coming to Canada in twenty thirteen. So about eight years have been here in Canada. You’re into fitness and triathlete, extreme sport competitor. I guess that’s partially why you’re up early. You got lots of training stuff to do. But you worked as an engineer and in the automotive field for 17 years with automotive companies. In 2015, you decided to venture into this world of real estate investing in Canada, as well as have your full time job at the same time at that point and obviously became a passion. Really interested in it. And you started buying properties learned about the Canadian real estate markets. And in 2020, obviously when COVID came around, you decided to go in full time. And we have here that’s you opened the rest of the holding company construction company started flipping homes, buying, renovating and selling them, mostly in Ontario and from May 2020 to up to today purchased and sold six properties. And so that’s doing some quick math. That’s about one a month give or take. And so I’ve been pretty busy, pretty busy guy in the real estate world. And so we’re excited to learn more about that experience and what that’s been like. From going from engineering to real estate, full time flipping houses, maybe even some wholesaling, we’ll dove into some of these different, different ways. They’ve flipped houses. So excited to have you here and welcome again.
Chris Herlin [00:08:53] Thank you very much, guys. Thank you. Thank you. Yeah, it was a crazy journey, to be honest. Well, for moving to in from engineering to real estate, it was almost a forced way because in 2020, COVID hit and I was laid off after 17 years doing the same thing first time in my life that I was unemployed since like I was in Brazil, actually. And. Luckily, but fortunately, I was already so deep into real estate, already have a few properties, already had the good cash flow going with my I already had a few properties in Stratford that we had rentals. And actually, the transition was easier. I would say not easy because of course, I had to build a new, a brand new company and start doing from scratch. But the whole my whole journey was not easy by any means, like moving from Brazil to here and learning a new language, trying to learn the way the Canadians move
Rob Break [00:09:59] things
Chris Herlin [00:10:00] a lot different than in Brazil. The weather to ride Brazil is like, as you know, Rob, you’re in Costa Rica. The weather is completely different, right? Like you have warmth in the in the Christmastime and the different in Canada, but I adjusted. 2013 was the year that they moved here. Well, wait a month for
Rob Break [00:10:23] it before you go into that, like you were saying there. Let’s go back. Talk about a little bit about, you know, your how you grew up and what would make you want to leave Brazil and come to Canada.
Sandy Mackay [00:10:36] And if there’s any real estate and in the end, if you did any real estate stuff in Brazil, I’m curious about that too.
Chris Herlin [00:10:41] I do nothing. No real estate in Brazil. I was so I was born, grew in Brazil until like 2013. So for twenty eight years I lived in Brazil. My father’s French, so I lived a little bit in France when I was young. So I had that, you know, the disparity between Brazil, the violence in Brazil and like the calmer living in France. So I always had this mind like it’s in the back of my head was like, why? Why do I have to live in a country that’s so violent? I’m always scared. So I had always this fear right of like going outside and like being robbed and getting whatever right leg is just so, so violent, killed, sometimes even.
Rob Break [00:11:37] What part of Brazil were you in Sao Paulo?
Chris Herlin [00:11:40] OK, so it was really violent. And so for my entire life, I was always like, I don’t want to live here. I want to leave Canada. I done Brazil, and I didn’t know where to write. Like, I still like Canada and Brazil. There’s Canada doesn’t have much history. There’s no war. There’s no nothing. So like, they don’t talk too much in in history or geography, too much in the class. But it turns out that they start working for a company. Two companies that are Canadian one is Gates Corporation. Another one was part of a magnet company, and I was introduced to Canada very quickly and they flew me to Canada a few times as a business trip. And that’s when I learned about Canada, when I came here and I fell in love right away with the country. But and that’s the mindset I had read, like I wanted to leave and because of the violence and all that and it’s a harder life in Brazil to be able to buy a house in Brazil. It’s really, really difficult like it’s and not saying not only saying that, but when I was young, I was not very money savvy at all. Like, I used to be like always partying, always drinking and spending all my money. So I didn’t have any money, any money to invest, to be honest, like. And when I moved to Canada, of course, you’re away from everyone. I didn’t have family, no friends, no money, actually. So I had to really get into my own comfort, my discomfort of not having anyone around and saved me from any trouble that I would have. So that’s when I started really thinking about building wealth. And that’s when I started getting into real estate.
Rob Break [00:13:40] OK. Very cool, so let’s. So what did you what was the first thing? First of all, OK. So you started visiting Canada a couple of times on business trips. So where were you going? Where were you staying?
Chris Herlin [00:13:51] I was typically von Toronto, very close to Toronto.
Rob Break [00:13:56] That’s where. But you’re in B.C. now. So how does that happen?
Chris Herlin [00:14:01] So this is something that not many people know, like when I came last time to Canada. I was I started really the process of asking the company to hire me here. So it was a process of really talking to my boss every single day. I didn’t want to go back to Brazil. That was the last time I promised myself. That was the last time I was going back to Brazil in 2012, when I came here as a I’m not going back. So they started the process, but it was not really like a guarantee to me that that was going to get the job. And it turns out that the company, Vancouver, connected with me on LinkedIn and they offer me a job in Vancouver. So they flew me to Vancouver. One day, I one in December 2012, and they offered me a job. And when I came to Vancouver, I fell in love with B.C., mainly because as an athlete, I was seeing people in December like biking on the streets and like doing activities outside where in Toronto was snowing and like. So it was a different lifestyle in B.C. is a completely different lifestyle. And you
Rob Break [00:15:11] didn’t speak English at the time
Chris Herlin [00:15:13] and a I spoke a little bit of English. It was broken English. I tried, I was I was really like, I was always the guy. That time my discipline and my want, my drive always pushes me to do stuff faster. So I came here like speaking broken English, and every single day I was training, I was talking to people. I was putting myself in uncomfortable situations and learning more and more every single day. And people saw that. And I said, like, Honestly, guys, I’m doing my best. I’m going to be I’m going to be fluent in English very soon. So they trusted me. And actually, the two companies offer me jobs at the same time. And I said the first one that gives me the job offer and the job, the job. I’m staying in Canada, that’s basically it. And it turned out that I got the job in Toronto and I stayed in Toronto, and it took me eight years to move to B.C.
Rob Break [00:16:10] So I knew the whole time every time you left Toronto, you were like, OK, I’m not going back to Toronto. No stay in B.C. it’s the last time. Go to Toronto.
Chris Herlin [00:16:20] Exactly, exactly. It was basically like, how? How am I going to make two B.C. again? That’s always my question.
Sandy Mackay [00:16:28] And so mean, you’ve only been there for like a month. Yeah.
Chris Herlin [00:16:33] So yeah.
Rob Break [00:16:35] So how did your investing journey start then?
Chris Herlin [00:16:38] So it’s when I met my wife. So when I moved to Canada, I was by myself. So I started the journey of like, meeting your people met my wife about six months after I moved to Canada. Well, at the time, like just an acquaintance, just the person that I met. And then we fell in love and we got married. She’s really very good with money like she really knows how to save money. And I had some money saved in Brazil, too. We brought them, I brought the money, we joined efforts and then we started investing. So we bought a house. My wife already had a house purchased in Collingwood, Ontario. And so we invested on another property, so we put one for rent. And that’s when we started like learning the power of cash flow. And then we pulled some equity and then we bought another two houses out of their equity. Then we continued going from there.
Rob Break [00:17:38] So single family homes.
Chris Herlin [00:17:39] Single family homes.
Rob Break [00:17:41] OK, very good. Where were they? Where over the next to
Chris Herlin [00:17:44] all in Stratford? So that’s when I was offered another job, and in Stratford, we were not. I was not, to be honest, like in Vaughan or Toronto was super hard for me to acquire anything. So that was the only way was to move to another city. I was offered a job in Stratford, and that’s when we started investing more in Stratford, Ontario.
Rob Break [00:18:14] And so how do you and at that time, you were able to purchase a single family home and have it cash flow?
Chris Herlin [00:18:20] Yes, absolutely. Absolutely. In Stratford, it was a funny enough. Stratford has been growing for the past few years, a little slower than all, like Toronto for sure. But Stratford has been a very good hub for automotive companies. And so really getting a lot of very good people around like that make money. So when we purchase those properties as single family homes, the prop, the purchase price was pretty good. Still like that timeless 2017, and we got them at highly discounted prices. So we’re really good at finding like off market deals or like buying with equity already. So we’re at the two hundreds at that time.
Sandy Mackay [00:19:11] As I said earlier, this late 2017, later in the year or
Chris Herlin [00:19:14] early 2017
Sandy Mackay [00:19:16] because the market was really remembered at the early part of 2017, was going crazy, right?
Chris Herlin [00:19:23] It started going crazy right after we started acquiring those off market deals in Stratford. And we already getting properties like with at least 50 to 100 K in equity, just because we’re buying them off market of off grid. And then we had I started doing some renovations that never done before in my life, especially in Canada. The construction is completely different in Brazil and learning on the spot on how to do things and doing the renovations, improving the properties and then putting them for rent and then pulling equity three four months later.
Sandy Mackay [00:20:03] These were what type of properties were they single families where they market them?
Chris Herlin [00:20:06] So I got. So at that time, I was buying everything detached homes, fully detached, single family homes that they had potential opportunity to do duplex conversions. Although I didn’t do them at that time, I was not informed enough in the market, like to do like conversions and things like that, or probably didn’t have enough money to do that. So we kept them as single families and rented for families, for, you know, like I was getting great mortgages. So we’re still making like eight hundred dollars a month per property and cash flow at that time, especially because the price of the property. Yeah. And this is all because the price of the property that we bought them for highly discounted and the average mark the average rent in Stratford at that time was fourteen fifteen hundred dollars a month. Mm hmm. Mm hmm. And our mortgage is super low, so we could actually cash flow really, really well on those properties.
Rob Break [00:21:08] OK, so go ahead.
Sandy Mackay [00:21:10] What was your strategy for finding those? How did you find these discounted properties? Because I sounds appealing, but it is. It is probably easier than you’re making. It probably more difficult than requires.
Chris Herlin [00:21:19] It’s not easy for sure. Every single day I would drive around, I would drive around city and trying to find properties in like just looking at properties that were like either for sale by owner or had a very good relationship with my real estate agent. And she would have pocket deals once in a while like she would make careers like this person here really need to sell this house. If we put an offer today, we’ll be able to get this property. So I got a few of them like that, that relationships and just putting myself in the zone of like just walking around and trying to find, especially because I run a lot, they bike all the time. I was always around town like just doing different things and just looking around and putting myself in those shoes of like knocking doors or like just checking what they’re up to and putting offers.
Rob Break [00:22:14] OK, so by 20, my guess early, twenty when you got laid off. What did your portfolio look like at that time?
Chris Herlin [00:22:23] at that time? I had five single family homes triplex, a duplex and a four plex.
Rob Break [00:22:31] OK, that’s pretty impressive. Yeah. And they come in that order.
Chris Herlin [00:22:37] Yes, pretty much of the same order. So before I got laid off from work already had a duplex in St. Thomas. I had those first five that I had for single family homes. Then then it came to Duplex, became the triplex in the four blocks right after. With a few three, four. Yeah. Yeah, I’m on in different cities like St. Thomas Duplex, St. Mary’s Triplex and Port Colborne in Niagara Falls, called Snigger Falls the four blocks.
Rob Break [00:23:19] OK, so then COVID hits and you get a call, I guess, that, you know. Tell us about that.
Chris Herlin [00:23:26] Well, actually, I went to work and then COVID started like really affecting the automotive market. And some, like GM, our biggest customer was Ford. They’re already scheduled shutdowns of their lines. And basically, the company couldn’t keep paying employees to stay in the office without work, right, without talking to customers. So I’m a program. I’m the program manager at the company. I used to work and the day that they decided to call me in the office like, you know what? We cannot keep paying you and you’re laid off for an indeterminate amount of time with no pay. No nothing. And the funny thing is that I had a smile on my face when they said that and they’re like, couldn’t understand because typically people would get really sad right now is like, actually, you’re putting your basically helping me getting to the place I needed to be done because it’s a comfort ride like the job. It was a comfort for me. I was already like passionate, super fashionable real estate, already doing a lot of deals. Had some good cash flow going, and I was just doing my job because the comfort that I had of like seeing that paycheck coming every single month and actually it was, it was it was it was almost a blessing to be able to continue doing what I was doing on a full time basis.
Rob Break [00:25:02] So you already knew what you were going to do.
Chris Herlin [00:25:04] I had this, I already had it laid out. I didn’t know how I was going to do it, to be honest, to quit my job. I already had the plan in February that that was going to quit my job in 90 days. That was a promise and a boot camp in front of about 60 people. I promised myself that I was going to quit my job in 90 days and it came before that.
Rob Break [00:25:26] Mm hmm. So well, I mean, so you just went out right away and started flipping houses. That was what you did.
Chris Herlin [00:25:36] Not really. Not really. I didn’t even know that I was going to start flipping homes. I’ve never done that before. I didn’t know even how it worked. But what I started was when I lost my job, I said, Well, I have to find a way to do something right. Otherwise my wife is going to go crazy home mode. So I started studying more of wholesaling. And because I because I found so many properties off market ready, like I did a lot of deals like that, I started studying how to add value to people like to get those properties under contract and all that. And this didn’t work for me. I I’m not I could not do that. I could not buy Igbo and say that I’m going to buy a house and just not take over, not buy it. And that’s when I start wholesaling for myself when I start finding properties and flipping them. And it came like almost instantaneously. Of course, it started making a lot of relationship with wholesalers, too, so I was buying a lot of properties from wholesalers. I was finding properties myself, and it basically was a great journey in terms of like getting off my off market deals or wholesale houses and then adding a lot of value to them and selling them. So that’s how I start flipping almost organically.
Rob Break [00:27:09] OK, so tell us about your first one, then let’s go to my
Chris Herlin [00:27:12] first one is in St Thomas. It was a single family home, massive house, got under contract from a very good friend of mine wholesaler. And I had a business partner that he was an active partner to. We the journey was basically finding the property and then trying to find the money to fund it, right? So OK from private money, of course. So getting the private lender. And then we started the work. We took three months. We finished the house. Are you guys doing the work? I was doing the work at that time,
Rob Break [00:27:52] all of it.
Chris Herlin [00:27:53] I was doing 100 percent of the work, not the electrical or any of the trades, but where I was. I was swinging, who were
Rob Break [00:28:02] there all day, every day making sure that things were happening.
Chris Herlin [00:28:05] Absolutely. I was swinging the hammer myself. That was the start. I promised myself that I was going to learn and do the work myself for. For that moment to build enough wealth. I would say enough cash for myself to keep going. But that really like I was building a life around like I was building a life around my business. Basically, I didn’t have time for my family. I didn’t have time for anything. My life was flipping the house, the house that we’re doing. In the meantime, we were getting more properties. That’s when, like the 16 came from because like, we’re basically every single day looking for more deals and all that. But this property self-learning, I taught me a lot about how to keep timelines, how to keep how to make money and flipping homes. It’s and basically started this the I would say it’s a hard word to say about destruction, but honestly, it was hard for me and my family to do that and swing the hammer and do everything by myself. But over time, this taught me a big lesson on how to build a business and how to build a business around my life. Not the way the other.
Rob Break [00:29:37] Right, right. And clearly, they would have overlapped. So you were probably like you said you were still looking for deals when you were in there swinging the hammer all day and probably purchase one or even maybe even two before the first one was done. Is that right?
Chris Herlin [00:29:53] Absolutely. We had three properties under contract before the first one finished.
Rob Break [00:29:58] And your idea at the time was to do all the work in those ones yourself as well.
Chris Herlin [00:30:03] Well, I mean, in the meantime, I was having a lot of coaching, right? So like, I started seeing that this was not feasible at all, like I was not going to be able to succeed, especially because flipping is three months. Like as soon as you started coding it for longer, like you’re losing more money and more money and it’s getting more expensive exponentially. And so I seek out like counseling and seek mentorship to start building a real business. Not a job, right? So I got out of my nine to five job and got another nine to five job or even more than nine to five, to be honest, was like I was working sometimes one hundred forty hours a week. And that’s when I couldn’t see my family at all. And just driving to St. Thomas from Stratford is an hour drive each way.
Rob Break [00:30:55] Mm-Hmm. Yeah, I can imagine I can. I can envision some tension going on with a lifestyle like that. So how did you? Let’s talk about how you, I guess, remedy this.
Chris Herlin [00:31:10] So we started searching for help, of course, just our hiring. So it was not an easy process to because in construction, especially during COVID to people, did show up like you hire someone and then they would come for a day or two. They just never would be found again. So we went through about, I would say, six or seven people in the meantime, like trail in between houses. So while we’re finishing one, another one was starting. So we had to start demo and all those things that you guys know. And then one guy would show up, never show up again. Then it turns into Chris and business partner to do that again while we’re trying to find another person. So the journey was super hard to get out of the nine to five again. So like, it took us five houses, to be honest, to find two guys that were reliable, that we started doing business together and those guys stayed with us until the end. That’s when pretty much I got out of the swinging the hammer and I was doing more the business side of it, just doing standup learning procedures, starting to do payrolls and things like that. So really being more a business owner than a another, another contractor for my company?
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Chris Herlin [00:33:46] Honestly. No, I it’s not that they didn’t. I didn’t like the work, I enjoyed it to be honest. Like I thought it was something that it fulfilled me like in terms of like the challenges and the learning experience on all that. And this actually just gave me a different perspective in terms of when I start hiring the guys that I knew actually what was needed to be done right and how long it took and appreciated more the people that work for me. I really appreciated that because I know how hard it is
Rob Break [00:34:27] and the timeline sort of sunk to how long something takes to get done to me because, you know, seeing a finished product and understanding how it got that way is definitely two different things.
Chris Herlin [00:34:41] Absolutely. Absolutely. And that’s what I see some of my friends when they look at those things happening, right? And they say, like, well, like, why did the guy didn’t finish on time? And then sometimes you just think, Right, I just look at a look at the guy, say, Well, you just look, look at the amount of work right and look at the complexity of this. It gives me a different appreciation for contractors. It definitely gave me a different appreciation. And that’s when I start putting a lot of thought in terms of how to make it more efficient. How can we make different REA? How can we how can we make this a little bit more appealing, right? So that’s when standard operating procedures, they start making them trying to figure out how to. How to help my contractors. Saving time and saving efforts sometimes and really understanding how long something takes to be done. And the last few flips that I’ve done, the timelines are so much more achievable just because I knew how long those things would take me to do and not forcing people to do things faster or pushing them into something that I know that’s impossible to be done. And that’s when my program management skills from automotive came to fruition, right? So we never we never know what or when we’re going to use those, those lessons that we learned in the past.
Sandy Mackay [00:36:20] By being an engineer, you probably have some pretty good systematic sort of in front of that type of mind, right? A little more analytical that you can probably work through that better than some people when you started, when you started saying operating procedures and things like that, for me, that’s the struggle. I know to do that down.
Rob Break [00:36:35] For some reason, I just automatically yawned right there. I don’t know.
Chris Herlin [00:36:41] And me too, like I’m as an engineer, like, I had to always think with a different mindset. Like in terms of like saving time and like, say, especially, you know, no motive, right? Because our motive, everything is so tight in terms of cash, right? Like everything’s so cheap, like the automakers don’t want to pay much for what we build. So we have to be strategic and the process needs to be so tight, right? So it’s streamlined. That’s the cheapest you can make. And that’s how I brought it this to real estate that that spread that experience, right? How can we make it faster? How can we make more streamlined?
Rob Break [00:37:27] So would you say that timeline struggle was your biggest challenge?
Chris Herlin [00:37:33] I think my biggest challenge was finding people first. Number one, contractors are super hard, and that’s why it translated to timeline. It translated. It was a consequence like, so either I would do it all myself and travel between houses and try to do things in parallel. Or I would have to get people to key to keep coming to the house and doing the work while we’re doing something else. And its timeline typically is a translation of something else that’s going on in the project. Right is either people are not showing up or not, they’re not doing the right, the work in the proper way or taking too long to do something. Or you just don’t have a perspective in terms of how long is going to take. So there is a lot of translations that we need to always look for to be able to make sure that the timelines are real are something that is achievable or it’s because people are not doing the work.
Rob Break [00:38:39] So give us just one more challenge, maybe that you’ve had along the way. Like a different sort of from a different angle than what we’ve talked about here and then and how you overcame it.
Chris Herlin [00:38:52] Money. Right. So like when you’re doing so many deals, like finding money partners that are always reliable, it’s super hard, right? So. On during when we’re doing the first deal, the first flip, I got a call from a good wholesaler friend and he said, Well, we have this property, we agreed that we’re going to buy it. And then when we’re finishing the first house, we were taking possession of this, this other house that was the fourth house that we purchased at the same time. And me, probably three days before the closing, my money partner said I don’t have money.
Rob Break [00:39:40] Yeah, that’s always good.
Chris Herlin [00:39:42] It’s like, oh, I have one hundred and eighty thousand dollars to put down in the property, and I had no money. I already had four properties. I was doing the renovation myself. I was putting money for the of myself. Me and my business partner. And I was like, well, that’s great news, so I called my business partner, said, like, you know what, we don’t have money to buy the house. We it’s three days before and we have to find money. And that journey started like and we stopped everything we’re doing and basically start calling everyone we knew. In two days, we raised two hundred and thirty thousand dollars in two days just from conversations. So you have to put yourself in uncomfortable situations. Sometimes this makes us grow super-fast. And that was a super incredible experience for me, and it never happened again. I basically protected every single thing around myself to for this not to happen again, because that was a stressful time, especially when you’re asking family for money. And I never wanted to go through that again in my life.
Rob Break [00:40:54] OK. Yeah. No, and that’s great. That’s a that’s a good one. Now I guess the next, like you said, just through conversation. So I mean, let’s analyze that a little bit more because obviously to raise that money, there is a bunch of different ways that it can be done. It can be done all through private lending. It can be done through loans, whatever. Like, tell us, tell us a little bit about maybe I don’t know. I don’t want to get too personal but share as much as you want. I guess I’m absolutely pull that together.
Chris Herlin [00:41:30] Absolutely. So first person I called was a big firm, private lending company that already had conversation in the past. But for them, it took them like about two weeks to get the money right. So until you apply and do everything and they do the due diligence coming in with the inspectors and everything else appraisals. Especially because his house was really like it was, you know, it was a is a hoarder house. So like anyone that would come in, there is no eaves, no downspouts, no nothing, right? So many of those guys, they don’t want to lend into those kind of things. So I had already in the back of my head that they’re being not going to give me any money for the house. Mm-Hmm. So that was challenge number one, trying to get a private lender to say, like, OK, I know you’re going to do improvements in the house. This house is like. A complete disaster, not saying another word. And that was number one challenge second challenge was yes, I had to do friends and family around basically like that is a seed round, just from family and friends trying to figure it out. They know me. I’ve built a name for myself that I am good steward with the money that I use and I say, like, you know, I’m going to give you this money back. I’m going to be able to find a private lender and get you the money back. And that’s what people did. Like, basically, I was getting seventy thousand dollars from my father in law, like another thirty thousand for someone else, and then I got six or seven different people to get two hundred and thirty thousand dollars. And that was the challenge, right? Like getting all those people to agree and to know that I could do that and giving the money back. It turned out that two weeks later, the lender accepted to lend us the money and then the lenders like to 80 percent of the value of the house that they appraised. And actually, it was pretty much close to what I bought the house for, so we could pay those guys two weeks later, 100 percent of the money.
Rob Break [00:43:44] And I would say probably other than maybe like some really close family who just doesn’t want to see their daughter’s husband fall into trouble by not closing our houses. It’s got to be because the track record that people looked into took like, like, yeah, he already had that established and you were able to show them, Hey, like, we’re, you know, put our money where our mouth is once you give them. Why don’t you give it to us?
Chris Herlin [00:44:13] Absolutely, absolutely. I’ll fight for that. I’ll fight for the money. I’ll go to war for that money. Luckily, we had already the first house sold already, so I could prove that you actually like what we bought for this money on that deal we bought that bought the house for two hundred and fifty thousand. We sold it for five hundred thousand dollars, so we knew that what we’re doing was right. We’re buying the houses at via very highly discounted prices on the right way. And luckily enough, during COVID, a lot of the people from Toronto start exiting Toronto because there were like more doing home at homework, work from home and St. Thomas boomed from nowhere. Like in 20 beginning of 2020, St. Thomas had a growth of like over 30 percent in price point. So we got to the point that we bought a lot of houses on the time that before the exodus started happening and then suddenly the prices of homes, I was buying homes for one hundred seventy thousand dollars, two hundred thousand dollars, two hundred thousand. And then there were like six hundreds on the five hundred six hundreds by the time we’re selling them. So it was it was a great time to buy them so we could prove ourselves really, really well.
Rob Break [00:45:37] Yeah, yeah, that’s great, man. That’s really cool. But what made you so have you stopped flipping?
Chris Herlin [00:45:48] I went. Let me let me rephrase that, I didn’t stop flipping, basically. August this year was the last for August. I was flipping the last four house that I had as plans to flip and I decided to take a break and then stay with my family. And that’s when we moved to ABC. It was it was a hard time. Basically, the past year would say, like without seeing my family, my I have a daughter that’s two years old, just turned two years old right now that I didn’t spend as much time as I wanted with her. My son is four years old, so that really gave me a lot of that. It was a pain, a pain point for me not being able to be with my family and do different things with them. And that’s when we decided, you know what? It was a dream for my wife actually as well like to live in a place that is. More outdoorsy and things like that, and we can do more things, and that’s when we decided to move to colonial area. In B.C., and that’s when I paused a little bit did the work, and we stopped doing activities with the construction company that I have.
Rob Break [00:47:08] I see. And so you’re still acquiring properties, you’re just hanging on to them.
Chris Herlin [00:47:12] Absolutely. We have the birds. I have a few properties that we do just buy and holds. Nothing for a little bit until like we start, I’m meeting more people here, probably I’m going to start flipping homes here, really getting the connections and all that. So it’s going to take a little bit, but we’re going to get back to it. How about this? I’ve never really like
Rob Break [00:47:36] about this question. I know that you need it and time off is very important. But how, how does it feel to you?
Chris Herlin [00:47:49] It feels weird. It feels weird right now to me to do stuff from home. It became like home was a habit for me to be able to be always dealing with properties and doing those things, those hard things. And I thrive in pressure. I’m a guy that thrive in pressure. So it became I needed a break and I’m very blessed with the break that I have right now. But. Without pressure, I don’t I’m not myself. So I need that, I need that very soon again.
Rob Break [00:48:26] OK. Yeah. No, I understand. I was just I was just wondering because it sounds to me like, I mean, I’ve been in that situation too, and I have learned how to relax a little bit. But there was definitely times where I just needed to keep going right and when and when I sort of forced myself to slow down. It was that was uncomfortable. So it’s a learning curve, no matter which way you look at it. I’m learning curve to get there and then a learning curve to back off. I’m telling you.
Sandy Mackay [00:49:02] Mm-Hmm. I know you’re doing some other stuff in the in the background, maybe or maybe it’s on the forefront, but you are working on some technology. Yeah, with a lot of this stuff. So what’s that all about? You’re developing an app or there’s something you’re working on that album, although
Chris Herlin [00:49:18] I started a year ago when. I really passionate about creating new processes as an engineer, Ray, just trying to make stuff more efficient. And when I was doing a lot of the wholesaling, I found a lot of the process was still like, so old school where you see, like, really medieval. And that’s when I started like thinking, how can I make this a little bit more? States already have. The United States already have a lot of like different technology that people use for either wholesaling or like anything off MLS. Write anything off MLS. Right now, it’s pocket deals or people like sending letters, handwritten letters or things like that. And for me, when I see that I always it hurts me when I see the inefficiencies, and that’s when I start thinking about a different way. Of doing things in Canada that other countries already found a way, red states already had a bunch of companies that are doing the home, but could the homeowner way of doing it if they don’t want to go through MLS and all that? So. And that’s when I started doing that. Then and building technology around it.
Sandy Mackay [00:50:45] So it’s yeah, there’s a there’s a massive the like the fintech world is has been going crazy over the last couple of years. There’s all these different things around the real estate world. There’s a there’s a ton of interest in that from big venture capitalists, everything think pretty interesting to follow on that, that that industry right now and it’s over the next couple of years too. Going forward, it’s there’s going to be a lot of changes, especially like you mentioned, there’s tons of this stuff already in the U.S. there’s a lot of there’s a lot of room for some outcome, some companies, some of the Hudson Valley there to this sort of stuff in Canada, but not just Canada, across North America and everywhere, but Canada for sure is lacking a lot of these resources right now.
Chris Herlin [00:51:25] Absolutely. Especially when you think that there is so much immigration coming to Canada there, like when you think, like, how are these immigrants, not only with buying and selling, but renting, you know, down rates. So there is not really real platforms that people are doing things and like following, you know, and that is. Is innovative for this market. So I built I build this around what I was having issues with, so it’s not only buying and selling, but my whole holistic approach is basically helping people getting not only the house, but like finding the contractors, finding everything to promote them or to help them thriving in the world of real estate. That’s all the problems that I found when I was talking to you guys about not having contractors around me. It is hard to contact with them because it’s there’s no real place that people can go, it’s like a LinkedIn to find an engineer, for example. There’s nothing like that for a contractor, for example. You have to go and guy; you have to go on Facebook Marketplace. And that’s when you see all the time people asking you on Facebook the validation from other people, right? How do you validate that a contractor is good today is based on word of mouth? Right. And when you say like, Oh, do you know a plumber that I can use? And then they ask for the validation from their network, and that’s what we were missing in Canada, too. And that’s those are the things that are going to be added to the technology. I believe that if someone adds that technology, they’re going to be very successful.
Rob Break [00:53:08] OK. Did you want to do? Do you want to promote your what you’re doing then or?
Chris Herlin [00:53:14] We’re very early stage right now. We’re in beta testing. We’re no dummy is the name of the company that I’m building. Oh, it’s Dominican. It’s a platform is the iOS platform right now. And at this point, we’re basically on the retail side, basically helping people like finding profits for rent or anything that’s off the market right now. Like people, they want to put properties for sale or for rent. And that’s the stage we are right now. We’re super early stage and we’re trying. We’re growing it organically right now until we get into Apple Store.
Rob Break [00:53:56] Yeah. And I know it’s early and I just because some you know, most likely, we’ve got listeners hearing this a year from when it’s recorded or whatever it’s sold by then, you know, it might be up and running. So I’m sure it was. It was DOMA.
Chris Herlin [00:54:10] Ali Alloway. So dumb. It’s a synthesis of two words. Don being my wife is Polish baby, and Dom is housed in Polish Dom and then ally for Do You Need Resources, Commodities and people for mutual benefit. So that’s what the meaning of dumbly use.
Rob Break [00:54:32] OK, gotcha. That’s cool. Spiteful.
Chris Herlin [00:54:35] Yeah. We thought a lot about everything in the company as everything, every single detail.
Rob Break [00:54:42] Yeah, I’ve got to name my flip house here now because it was called Casa Maria, which is yellow for those that don’t know, but it is no longer yellow, so we’ve got to figure out a new name. And that’s been stewing around for a little while here.
Chris Herlin [00:54:57] So it’s amazing. I love that and love that.
Rob Break [00:55:01] And then get the sign made because that’s how that’s around here. That’s basically how you would tell somebody, Oh yeah, it’s Casa Tortuga, you know, and then they drive down the street until they see Casa turn to gas. So it’s
Chris Herlin [00:55:14] amazing.
Sandy Mackay [00:55:15] Now I figure we need we need something like that around candidates. That doesn’t happen
Rob Break [00:55:19] there. I don’t even know how to get my mail. Like, it doesn’t come to the house. I’m still trying to figure that out. Quinton de Souza sent me a book. Apparently, I don’t know how to get it. So you asked me yesterday, Have you gotten the book yet? I’m like, I don’t know how to get my mail, so I had to figure that out.
Sandy Mackay [00:55:37] What are these years? You got to figure that out?
Rob Break [00:55:39] The important thing is the important things come to email, right? All the bills come to email and you can pay it online. But all this other stuff we’ve still got to figure out.
Chris Herlin [00:55:47] Absolutely. Mail is going to be something that is going to end at some point to technology. I’m going to take over done. The college has to take over that.
Rob Break [00:55:58] Let’s talk about a piece of information, advice or advice that’s always stuck with you.
Chris Herlin [00:56:04] I believe that, you know, like a. You need to you need to be able to live in your own comfort zone. And that’s what I thought I learned when I lost my job as an engineer and like, follow my passion. I believe that holding yourself to something that you’re comfortable with just because it’s comfortable. It’s sometimes not going to drive you to the next level. And the me getting out of the comfort zone and starting to wholesaling and flipping homes changed my life completely. Getting this hard like it was hard because probably I didn’t put enough emphasis in terms of hiring more people. But putting yourself in those uncomfortable is all uncomfortable zone in your passion, something that is going to change your life. It is something that I learned and I really share with everyone that I talked to. Or when should I start moving to real estate? When should I start doing more real estate and stop doing what I’m doing right now that I’m not as passionate about? And of course, everyone, every time everyone’s timing is different. But put yourself in that uncomfortable situation like, you know, once when you think it’s right, of course, I’m not going to say for you to stop earning money and then going bankrupt. But when you put in an uncomfortable situation under pressure, we always, as humans, we always find a way out. And that’s what I found when I lacked money, right when the guy went to the private lender didn’t come with the money. We under pressure. We always find a way. We always have a solution to the problem. So that’s what I wanted to basically tell people like just follow your dreams, follow your passions and get them comfortable.
Rob Break [00:57:57] Yeah, I think that’s a good one.
Sandy Mackay [00:57:59] I like staying uncomfortable as much as he can, for sure. It’s dangerous to be comfortable. Sometimes it’s some women Sandy earlier. Sometimes. Sometimes it’s sometimes it’s uncomfortable, you know, maybe trying to relax a bit too. And there’s both sides of that, right? It’s not necessarily you need to go do a million different things. Sometimes it’s that you need to. Maybe that is comfortable. If you’ve been working in that or living in that too long, maybe you need to go the other way. But absolutely, I totally agree.
Chris Herlin [00:58:25] Yeah, absolutely. I think that for me, it turned comfortable flipping homes at some point because I start building, I start building the standard operating procedures. And then the timelines were like easier to agree with. And then the cost of doing renovations started to get really, really close on the on an estimate side to the point it was from estimate to finish, it was a thousand dollars difference from the estimate. It became comfortable and I said, How can I get uncomfortable again? How can they get to the point that right now this is completely new, right? How can we do that and then build, build the business or build the business that can run on its own on a construction site, on a flipping site and then do something more uncomfortable on the other side? And that’s how I thrive.
Rob Break [00:59:19] And if you dial if you dial this rate back, sort of to someone who’s maybe listening to this, who hasn’t invested anything in anything yet, you know, that first purchase is going to be uncomfortable. There’s just no way around that. No, you can learn and learn and learn for years. And no matter what, that first purchase is still going to be uncomfortable. So unfortunately or fortunately, you’ve got to face that reality in order to move forward in this space. Right. So I think that that’s a good lesson for all the people listening. Absolutely.
Chris Herlin [00:59:56] Absolutely.
Rob Break [00:59:58] So let’s talk like, what are your big plans now for the future? You said you might start getting into flipping in B.C. as well. What else do you got in the works?
Chris Herlin [01:00:08] I’ve been really thinking about rebuilding the next generation of my life into technology. I’m really passionate about it and really, I really think that there is a lot of potential when you’re talking about technology, a lot of options, right? Different than real estate is, there is a lot of options. There’s a lot of exit strategies. There’s a lot of ways to build wealth through real estate, but definitely. There is technology, there is so much, so much to explore that I’m super, super intrigued about that I’ll be continued doing likes flipping and probably like hiring more people and getting people to do the work and then continue going with different, different technology for real estate. I’m going to continue doing real estate, but in technology side. So I have another a few ideas how to add value to people on a technology level.
Rob Break [01:01:07] It’s great. Well, Chris, you know what, we’ve really enjoyed this conversation today, so appreciate you taking the time to come out and join us here today.
Sandy Mackay [01:01:16] I think it’d be great to be a great guest down the road with one some of these technology things that are coming to light for you. We’d love to have you back on to learn about that experience or about hopefully some great successes we can share at that point too.
Chris Herlin [01:01:29] Absolutely, I would. I would love to do that. It’s going to come. It’s just a matter of time right now, but I would love to come back. I really enjoyed the conversation with you guys.
Rob Break [01:01:38] Yeah. And I want to thank our good friend, Corey McKinnon for hooking us up, right?
Chris Herlin [01:01:42] No, I appreciate that too. I appreciate Corey for all this and to introduce me to you guys.
Sandy Mackay [01:01:48] A lot of Corey is a lot of Corey’s friends, clients, etc. When we started engaged with him, it’s like we’ve done 15 flips in the last 12 months or like they have some big numbers,
Rob Break [01:01:59] really interesting people and go through his courses and things like
Chris Herlin [01:02:03] that. So yeah, I know he he’s very good at finding great people around, for sure. Yeah.
Rob Break [01:02:08] Now how can people get in touch with you if they want to learn more even more about what you’re doing?
Chris Herlin [01:02:14] So I’m on Instagram as a Chris Harlan Facebook, the same thing and LinkedIn. So search move Chris Harlan and I would be. I would love to chat more about it if you guys have any questions. I’m always open. I’m an open door kind of guy like, I’m always, I’m always willing to share and to listen, learn new things. So please contact me. OK, we can talk about anything that you guys want to talk about.
Rob Break [01:02:44] That’s Chris S.H. Rice and Herman is our ally. And again, like all of your contact info, is going to be in the show notes. People can go over to our website and get in touch with you through there as well. So again, thanks, man. Really appreciate it. You. How can people get in touch with you?
Sandy Mackay [01:03:06] through eight nine three eight nine six eight four six or infodemic Ariel’s network dot com
Rob Break [01:03:11] and you can reach me, as always at Rob. Mr. Breakthrough Dossier, we will see you next time. Thanks for joining us.
Chris Herlin [01:03:19] Thank you, guys.