Table of Contents
Sandy Mackay [00:00:31] Breakthrough Real Estate Investing Podcast Episode one hundred eighteen.
Announcer [00:00:36] If you are looking for the skills and tools to succeed in real estate investing, you’ve come to the right place. This show is about breaking through barriers, breaking through limiting beliefs and breaking through to the life that you want to live through the power of real estate investing. This is the Breakthrough Real Estate Investing podcast, and now here are your hosts Rob Break and Sandy MacKay.
Rob Break [00:01:09] Welcome everybody again to the show. Thanks for joining us today. Sandy, how’s it going?
Sandy Mackay [00:01:15] Awesome. I’m excited to be here. Excited to record another show and have some fun.
Rob Break [00:01:20] Me too. Very excited so everyone should go over to our website. Breakthrough Aria podcast dot CA. There you can download every show that we have done in the past six years and listen to it again if you want to, as well as download our free gift guide Sandy
Sandy Mackay [00:01:36] The Ultimate Strategy for building wealth through real estate. You also jump on our email list, and we do that, so it gets everybody. All the events are doing things like that. Get updates on shows as they get released and everything that’s going on in Rob and my real estate world there. So jump on over and get that report and get our email lists. Keep updated.
Rob Break [00:01:54] Very, very good and go over to iTunes as well and give us a rating or review for the show. We’d really, really appreciate that. It’s been a while since anyone’s gone on there and told us what they think. So whether it’s good or bad. Get over there, click the little button and leave us some feedback, please. We’d appreciate that.
Sandy Mackay [00:02:09] Definitely. And then let’s go check out our Facebook channels because we’re rolling videos out now and we haven’t been doing that for a long couple months. But if you’re listening to this on audio, definitely go jumping over to our Facebook page Breakthrough Real Estate Investing. You can get engaged into the conversations as we’re doing them live like today and ask some questions, engage with some of our guests. And we’ve got some great guests like we do today.
Rob Break [00:02:35] Yeah, we have a great guest today, Jared Hope, who’s standing by here with Tilt Group and so I’m sure there’s going to be lots of questions that people want to ask. So now you can go on the live comments section and just click there and ask away. We’ll get to them.
Sandy Mackay [00:02:51] Absolutely. So we are going to welcome Jared here in a SEC or anything else you want to cover before we get into that.
Rob Break [00:02:58] Not really. I think we’re good. I mean, I may be over speaking. I’m not exactly sure if we’re going to be getting back into the live tours pretty soon. I’m going to maybe try a one off and see how it goes. As long as we can get permission to start going through some properties together with a very, very small group, it’s going to be, you know, sort of an elite thing. I guess we’ll look at it that way, but hopefully we’ll be gradually working back into the way that things used to be and get some of these tours going again.
Sandy Mackay [00:03:33] So you’ve been doing the virtual right.
Rob Break [00:03:37] I’ve done a couple of virtual but for the most part, it’s just been some one-on-one stuff. We’ve went back to the one on ones and that’s going well too. So. But, you know, people do like the community. You go out, you see what everyone else is doing. Usually we would stop by a rental project that somebody has on the go and see what they’re doing. So that’s very helpful for new people just wanting to get out and see what’s going on, right? So that’s one of the main tools. I think that we’ve been missing. And hopefully, we’ll get back to that a.
Sandy Mackay [00:04:09] Cool, cool. Well, I think we should welcome in Jared here. I’m going to do a quick intro and then we’ll ask him some questions. We’re looking forward to this one. Got some fun stories lined up and I was going to share. And yeah, it’s always exciting to listen to. So with over 150 properties in his portfolio and having foreign plus transactions under his belt, Jared Hope is the owner of Edmonton’s most comprehensive real estate investment and property management company as half of the real estate investing power couple, Jared and his wife, Krista hope. Together, they’ve developed a no bullshit real estate coaching program that makes it easy for the average Canadian to own income properties. And Jared’s expertise is born in experience and focus and focuses on action oriented, practical advice. He believes in cutting through the B.S., evolving the way real estate investing education is provided and supporting people and avoiding all the mistakes. He learned the hard way. Over the past 16 years and is investing career. So welcome to the show, Jared. Hopefully, that gives a bit of an intro. I know you’ve got lots more to share and lots of exciting stuff they’ve been through. So welcome to show. Happy to have you. Thank you.
Jared Hope [00:05:13] It’s like I wrote that by myself. I know what you like. I did. I did really before I passed it off to one of my staff to write, and you’re about to say, I’d like to drop a couple of F-bombs. I totally dropped the bomb. Is there any is there rules for the show is like, am I not allowed to swear? Is it fair game?
Rob Break [00:05:34] No, I mean, you can. I can do it if you want to. That’s fine. I mean, it’s not in the rules.
Sandy Mackay [00:05:40] There’s probably a limit we do have. We are. We’re not on like the what’s called the explicit list or whatever on. Yeah, there is a limit, but you know, we want to make it exactly where we want to, where they get away. Yeah.
Jared Hope [00:05:52] Well, I might slip one in every once in a while.
Rob Break [00:05:54] But today we’re going to be getting real and we’re going to be talking about some horror stories. I’m really looking forward to this. I think you’ve got to let a lot of lessons to share with us through these stories, so I’m looking forward to it. So thanks for being here. I appreciate it. Yeah, you guys. We’re going to start out the way we always do and just ask or maybe just tell us quickly how you got involved in real estate investing.
Jared Hope [00:06:21] Back in 2003, my eight, my dog is growling behind me. We just got a new puppy and he’s like 10 months old, so any little noisy growls that it’s so funny. So as a personal trainer, I played hockey my wife on a massage table. And in 2003, we just, you know, Chris was growing up on a farm and her parents were very entrepreneurial and they just, you know, she didn’t she didn’t really believe in working for the man or having a job and, you know, I play hockey my whole life. In 2003, you went to a real estate workshop in Hamilton, and we ended up she ended up signing us up for their membership. And I was so mad I had no interest in doing real estate. We couldn’t afford the $200 a month. At that point in time, because I was in the membership and there’s actually 300 for the both of us and we just couldn’t afford it. And I was so mad. I knew nothing about real estate. I always, you know, rich dad, poor dad. And when I read that book and my dad was a phenomenal dad, but he had a poor dad mentality. Save your money, go to school, get good grades. He was that guy. We didn’t grow up or we weren’t poor, but I was taught that, you know, get up, get a house, and go to school. Worked for the same company for 25 30 years. And that’s your path. And Christopher was taught something different, so she signed up for the real estate program. And the first six months, I was right, pissed off. I went, you know, I went to them to pay for these meetings, or we went to them, and I would sit in the back of the room with my hat on and back like this or just cross my arms and in the back of the room, just judging all the speakers and judging all of the people in the room. And six months go by, and we bought our first property, and that year we bought three properties, and which is cool, you know, whatever made some mistakes and bought, you know, looking back now, I wouldn’t have done things a little bit differently. But the second body properties in the 30 year we got a killer year, we bought 64 properties and today we transacted four hundred eighty over four hundred eighty-two. Now I just bought one last week. And so we’re 482 properties in transactions on 52 properties. And so that’s how we got started. And to be honest, I had no interest in being in real estate. I had no interest in being a landlord back in 2003.
Rob Break [00:08:48] So where was the turning point? I mean, you mentioned the first one that you bought, you must have started wearing your hat a little bit differently. Yeah, you’re meeting a little bit more and then now.
Jared Hope [00:09:00] OK. No funny question. You know, I’ve been wearing a hat now forever, and I back in 2017, we hired a company out of Vancouver to do a little bit of a rent side bar, but we hired a company out of Vancouver to do some branding and they’re like, Jared, you have to change your image like you have to do boss casual and you have to wear these sports coats and dress shirts and collared shirts and got to do your hair and you got to shave, you know? And I’m like, you know what? That’s just not who I am. And so I wear a hat. I’d wear a hat on stage. Like the last time I presented on stage, I wear a t shirt and jeans and you know, you’re either liking or you don’t. That’s totally cool if you don’t. However, I still have some really great lessons and tips to teach people just from the trials and tribulations that I’ve gone through in my life. So, you know, so what are what were what was the turning point? You know, to be honest, I don’t. Probably 2008 was the biggest turning point when I left my job as a personal trainer 100, 130, $140000 a year in income from personal training back then, which was a lot of money. You know, it goes with two young kids that are second credit to that in 2007 and 2009, and they were both making really good money and we left our jobs for real estate. And that was probably the turning point because I’d actually set us on a downward spiral because the market shifted in 2008 with that financial crisis. And so, you know, a lot of people sit there and say, well, what shifted? What allowed you to, you know, how did you grow your portfolio so quick while buying real estate is so easy, guys, that in my opinion, it’s super easy. It’s maintaining and sustaining it for longevity. That’s the hard part. Well, having a well-balanced and successful marriage or relationship with your family, wife, or kids, that’s the challenge that most people, I think, struggle with buying real estate. Anyone can go buy a house buying the right house that works. That’s a totally different story. So I would say 2008, when I left my job, that was the turning point because I really had to. You know, I didn’t know if the properties I was buying were the right ones until 2008 when I realized they weren’t.
Rob Break [00:11:07] So I guess just really quick because I want because I feel like it’s important and a lot of people have the same mentality as you like. So what I was referencing was, you said you went to the back of these meetings, you pulled your hat down, you sort of sat at the back and didn’t really want anything to do with it. But eventually you guys went out and bought your first one. So was there a was there a point where you were sitting in the back there and you realized, OK, maybe these maybe, maybe these guys aren’t just spouting off baloney. Maybe they’ve got something real to ship. You’re here.
Jared Hope [00:11:41] No, yes and no. So, you know, so I joined Ring in the Real Estate Investment Network Great program. A lot of great theory being taught, you know. So I was sitting in the back of the room and I’m a very competitive guy. So, you know, like, let’s be honest, most people in the rooms, whether it’s rain, keeps rig rock star I Islwyn Right Club, whatever the group is, it doesn’t matter. They fill the room with three or four or five hundred people. But the truth is, maybe five 10 percent of them are actually doing anything, anything of substance, a substantial quantity, right? So there might be people with one, two or three, but there’s very few who have 10, 15, 20, 30, 40 or more. So I was sitting in this room and watching people get these stupid pins and a pin for three, a pin for eight, a pin for 17, a pin for 100. I’m sitting there. I’m like, Loser, loser, loser. I can do this. Not that they were losers, but I’m like, you know what? I’m still so competitive. I’m like, I can go crush this. I can be better than all these guys. So I was playing the game to be seen as the best, because that was the environment that people put you in. That was this environment of rain or rig or fire or whatever these groups are. That’s what they do and nothing. That’s their business model. I totally get it. But back in 2003, I never got it. I thought by being the guy, I was the guy. And so, you know, so the turning point for me, I guess, was when I realized that if I got three properties, I got recognition and if I got eight, I got more recognition. If I got 17, I became a player. And if I want, I got 100. I was the man. So that was my goal. I was out chasing pounds and it was it was detrimental to us in 2008. And most people, that’s how people play the game. They play the game to get on a stage or get on a podcast or to talk the talk about something they don’t actually understand because they haven’t seen enough to go through it. And yeah, we’ll go on more of a rant here in a second
Sandy Mackay [00:13:42] that, you know, I can only assume some of that came from very, very competitive athlete, obviously, and we can touch on that as much as you want. But obviously, you were a relatively successful hockey player in growing up in Canada. That’s kind of makes you the man, right? So if you’re in that mindset growing up, you obviously want to be. Does that help you with your competitive edge there in in real estate? I can only imagine
Jared Hope [00:14:02] it would have been absolutely. And I’m not like every company works, you know, because they all have their own concepts in the way of doing it. Me in that model was I was super competitive, you know, so I remember seeing this guy, Arlen Dolan Arlin at that time at hundred and something properties and he would show up and you had this messy hair and you coming of buddies now get this messy hair 100 something properties and you’d go up with these grubby sneakers and you’d stand up to this mic that open Mike back in the day and the ascent up to the mic or success stories or something like that. You could say the success story about what he’s doing, what he bought. And I’d be like, Oh my God, what a fucking loser. I can wear, outperform him. And so that’s how I that’s how I rank myself. You know, so because I wanted to have the mike, I wanted to be the guy. I wanted people following me. I wanted to be, you know, because that’s what I just wanted to be the best. That’s how I was wired. So when you put me into an environment like that, you know, I was chasing appeared and I was chasing us. I wanted to be on stage. I remember in two thousand in two thousand and five, I ended up hiring Don Campbell as my mentor. And that year, about sixty-four properties, and I remember telling Don in 2005 that I’m going to take his job and I’m going to own rain. This is 2005. What do I know? And I was twenty-six, twenty-seven years old, and I’m sitting there telling John Don, I’m going to take a spot-on stage and fast forward to 2010 2011. You know, I was on stage with them for 10 years, seven years, eight years. And, you know, but that’s just how I was wired. I was wired to go for it all and to put in the time and work hard. And you know, I’ve always had coaches. I’ve always had skating coaches and nutritionists and trainers. I’ve always had that in my life. So when it came time to build real estate, this is another mistake I think people make when it when they. Try to build a real estate on their own and try to follow multiple people and they go, listen to someone, talk on stage for 30 minutes and they think that’s enough for them to go build a business, and that’s some of the mistakes we’re going to talk about today. And so they’ll hop on a plane and fly to Regina because someone from Regina was talking about how great Regina to the hop on a plane from Toronto or anything to fly to Regina by 10 properties. Well, that’s not that’s not necessarily how to play this game. So, you know, but one thing with me, as always, I’ve told you so when I enlisted Don, a super coachable. And, you know, actually it sped up my process. It sped up my journey in real estate.
Rob Break [00:16:36] And when you said in 2008 that it was there was almost detrimental to you, do you mean that? Do you mean that like your competitive nature, had you working too much or like was there a part of your relationship that was suffering or something you?
Jared Hope [00:16:51] did everything suffered in 2008. So in 2008, the global recession hit, right? And at that point in time, I had bought maybe a ninety-five ninety-eight hundred something like that hundred properties. I’m not talking doors, I’m talking properties. Everyone else talks stories. I talk properties and titles like It’s so easy to get fifteen doors. You guys, you can go to one building. That’s fifteen doors. That’s one mortgage. That’s one. That’s one run the gantlet with the banks to go get 100 mortgages. That’s hard. And that’s gives banks. That’s, you know, structure. That’s so much stuff that has to be implemented. But in 2008, you know, I had one hundred ninety-five to 100 properties and you know, when I left my job, I left my job in like June 2008 and the financial recession started. You know that global meltdown started in August 2008. And you know, I was making, you know, we were used to living off of, say, one hundred and fifty hundred and eighty thousand dollars a year at that time. And so when I left, when we left our job, we started living off our real estate portfolio and now we’re watching our real estate portfolio. Excuse me. But at that time, as the market starts dropping also the rents, as we had this global recession, the rents started dropping. So as rents started dropping, I started taking pay cuts, but I didn’t take a pay cut. I just kept my income the same. So my income. So one hundred and fifty-one hundred eighty grand, my rents are dropping my income and my company is dropping. But it’s so my burn rate is really, really high. So looking back on it now is buying the wrong properties. So in 2005, six seven, I was buying properties that were 50 to $100 a month cash flow. Some were, some were zero cash flow because at that point in time, I’d seen 30 to 40 to 55 percent appreciation. So I’m like, OK, we’re good. We’re good, I’m so bank. I got so much equity in these properties. But when I left my job, what people don’t understand is, you know, living off your portfolio solely. If it’s not set up right your desk, you don’t want to see your desk in the field. But the fall can be really, really hard because if you’re living off your portfolio, there’s a shift in the market. You’re directly impacted that you have no other source of revenue. So that was that was the lesson for us. In 2008, we realized that we bought one hundred, not a hundred, probably 60 of the wrong types of properties that they just didn’t cash flow strong enough.
Sandy Mackay [00:19:19] Where were those properties you were buying at that point? Were they? Have you been always in one or two areas or have been kind of scared?
Jared Hope [00:19:24] Yeah, no. Like, I’m always right. So I live in Colonia now, but I invest in an attempt. At that point in time, I probably had. I probably had seven. The eighteen, maybe, maybe a little bit more in Grand Prairie, which is northern Alberta, which is an oil and gas town up there, which back at the time was the other mistake that know happens is these are all horror stories, guys. Right? So the other mistakes, you know, you know, at that point in time, rain was coming out of the top towns, top towns to invest Edmonton, Grantley, Calgary, Hamilton, Ottawa, all these top towns. Well, the problem with that, that’s all theory. That’s all. That’s all bullshit. Because in those towns are certain communities you want to stay away from, but you just you can’t sit there and say, here’s the top town to invest. What I’d rather hear is here’s the best 10 communities in that town to be investing in. So what people do is they run Hamilton, they run to Ottawa. They went to what? Waterloo, they run the, you know, colonial wherever and they buy in that city. But they don’t understand the actual city itself and the demographics and the geographic of the town. So, you know, at that point in time, you know, I had a bunch of Edmonton and a bunch in Cologne, a colonial grand prairie, and I saw. So in 2008, I end up firing my property management company because they were doing a terrible job. And, you know, so we just shouldn’t say that they just weren’t doing a good enough job that I wanted. Plus, I had to me had to save some income somehow, like I was paying them 40 $50000 a month, maybe more in management fees. So in 2008, as my income starts dropping, I had to make money. So I let my management company go and we started self-managing our portfolio.
Rob Break [00:21:07] But that that sounds like a horror story right there.
Jared Hope [00:21:09] Yeah, yeah. You know what? Yeah. And then guys, I mean, I have so many stories just from the property management side, from shootings to strippers to drugs to. Guys hide hiding pot plants on me to like kicking people out, seizing cars and trucks that I did some fake stories,
Sandy Mackay [00:21:31] but we got to get into those because I think what I’d like to hear is we’re you’re out a bit today and then and let’s get into some of those are exciting.
Jared Hope [00:21:40] Yeah, I know what story. And they’re all funny. You know, I look back, I don’t I don’t, you know, my wife and I went out for dinner the other night and she’s like, you know, what would you do differently about my life? And I said, nothing, you know, like, we had some hard times in 2008 to 2010. That was a hard time to financially business wise. We reset, we restructured. You know, we didn’t really do. I wasn’t really doing any personal development at that time. I was just ego, ego, ego driving, ego, driving, ego, driving me. Kristen started doing personal development work. Well, she’s always done it. But really, in 2000, maybe in 2010, she’s really kicked it in 2015. Our relationship hit a really rock bottom. I was drinking like, now we should have been divorced come 2015. And it was just a hard time. And, you know, in 2015, we got married in 2003. By 2015, 12 years later. We just shifted, you know, we had kids. We had the success of the successful business that we’ve turned around twice, two or three times and we just drifted apart because, you know, I had someone asked me the other day, Why’d you? Why married Krista? That’s my wife. And I said, well, it doesn’t really matter why I married her. The question is, why are we still together? That’s the question that we have to be asking is why? Why do I continue to choose Krista? Why does she continue to choose me every single day? Because we have options? She has an option to leave. I have an option to leave. Why we got married 13 years ago. It doesn’t matter because we’re different people, and we didn’t realize that until 2015, when we just drifted apart so much. And because I got so focused on the business and she was so focused on the kids, that’s what real estate did. That’s how we set up our business. And that was the impact, you know, to where we are today. Like, like you asked Sandy like, dude, life is so good now. Like we live in closed loop for five years and we’re trying to move to the water right now onto the lake. And you know, we have two great kids. They’re 15 and 13 years old. They’re amazing at hockey. They’re just amazing kids. They understand my business, our business, you know, like, they’re the way they interact, the way they communicate. You know, you’re paying rent for every guys. Our kids see a psychologist go and we have a family shrink. We call her, her name is Patty, and we go see Patty. And we started with our kids with Patty a number of years ago. And the reason why we started taking the kids to Patty, you know, Chris and I go see Patty every month or every couple of months. But the reason why we started taking the kids is because it’s really important to teach the kids to ask for help. When they need it versus thinking that they have to do it their own on their own. So this is something that I learned back in hockey my hockey days when I was playing hockey, I always had a coach. You know, not just the head coach, not just an assistant coach, but I also had personal trainers and nutritionists. I had psychologists, I had skating coaches, I had skills coaches that I had all the coaches, right. So I’m sitting there and like, so now when I want to grow my business, right now, I have a coach out of L.A., you know, then John Wineland. I’ve had coaches for years, so I’m super coachable. Whereas most people are not super coachable because they’re not. They’ve never been taught how to be coachable. So we’re teaching our kids at a very young age how to be coachable. So hopefully when they get older, they can reach out when they need it, whether it’s in relationship, whether it’s in work, whether it’s in business, personal development, career, whatever it is, we want them to be able to reach out and ask for help. That’s where we are today.
Sandy Mackay [00:25:17] Well, what about then then in the real estate side of things, obviously, have you had you kept going at the same pace as you were early on or is that changed up year to year? And how does that transition?
Jared Hope [00:25:28] Well, I think it’s pretty impossible to hold at 60 for a year. Excuse me, I think that’s next to impossible. Last year, we did so in 2011, 2010, when we come out of the recession, the global recession, we have to change the structure of our business because we were like, seriously, guys, like I was losing eighteen nineteen twenty thousand dollars a month from 2008 to 2010. I share the story all the time. I had a lot of cash in the safe. We’re watching the bank; we’re paying our Jib Jab partners just bank every single quarter. You know, we’re cutting checks twenty twenty-five thousand dollars of positive cash flow. I raised $20 million with the JV money over the years, and all of it was done wrong. And I think we have a topic of JV horror stories, so we’ll get into that. You know, so. But in 2011, I started. I bought my first house to flip and not knowing what I was doing. I bought this house to flip, and it worked out great. I bought it for one hundred and forty-five hundred and fifty-two thousand dollars sold it for two hundred twenty-five thousand dollars. It was great. Made some money there. The second house I bought for $200 and sold it for three hundred seventy-five thousand, but I didn’t like that one. I still made some money, but I wouldn’t think about for months to sell. And the reason why it took four months to sell it because people were coming in, they didn’t like the direction of the backyard. They didn’t like the countertop Typekit. They didn’t like the color of the paint. They know the backsplash tile. They didn’t like the apple tree in the backyard because what I was doing wasn’t selling a home. And people pay a certain emotion, whatever emotion they have into their place of their home. So I quickly after that when I realized that I don’t want to sell homes for people. I’m not. I don’t do homes; I do rentals because I know the rental business inside and out. So after the second one, we just started buying houses and making them legal suites. So to date, I’ve done about hundred and fifty of these. So, you know, so I keep every fourth, every fifth, one kind of thing. But then we sell all the rest. So I’ve done about one hundred and fifty of them since 2011, so I’m still buying, but I’m buying differently. I’m not. I’m not buying to hold, you know, like I’m looking at buying this cool new jeep, this old Bronco. It’s like 1970 Bronco and it’s eighty-five grand or ninety grand notes, 80 90 grand. And I put it on Facebook saying, hey, do I buy this thing? It’s super cool. And someone put a post saying, hey, why don’t you just buy a house with that money and use the cash flow from the house to pay for the Jeep? I said, Yeah, that’s a great idea if it was 15 years ago, but I’m done with acquiring properties like I have $40 million worth of real estate. I have about six or seven houses, clear title. I have another 15 houses that are under $50000 of debt, like I’m at the end of the game, where now it’s time to play and have some fun. And you know, so I’m done building the asset base that they already have, so much like we do $270000 a month in rents. And so now I’m just trying to buy down my debt as fast as possible. So we buy the houses, we renovate them. And then every time I sell it, I take that cash from the sale, and I start. I’m starting to pay down my debts. So that’s how I’m buying down my debt so fast.
Rob Break [00:28:55] I mean, I guess you could have just answered, that’s what I’m doing. Yeah, that’s what I’ve already done. But did you end up buying the truck or not?
Jared Hope [00:29:05] No, I am. So I just had this just happened, like the other day, you got to see this jeep. It’s so deadly. Of course, it’s my Facebook page. So nice to see it. It’s actually on my Instagram already, but it’s so it’s just an old school bronco rag top old bench seats in the back like just, you know, little four or five speed. It’s just amazing. So no, I haven’t reinvented.
Rob Break [00:29:28] Very good. OK, let’s get into some horror stories here. Yeah, yeah, we were. We’re going to start out. We’re going to hit them. We’re going to hit them hard right off the bat. So what do you think is the biggest mistake you’ve made so far in real estate?
Jared Hope [00:29:43] The biggest mistake I’ve made. I made lots. I know I just sent you an email with all this, but now I got more stuff coming to me. Number one, mistake is thinking. I probably thinking like I did. I could do it all by myself. That was a big mistake. Another big mistake I would have done is fudging my numbers, so, you know, I would go buy a property, I was Typekit. You know, here’s the percentages that you use. Here’s the rats and mice mortgages, taxes, insurance, management fees, blah blah blah. And then I would take I would say, OK, well, this property is eight years old and it’s in great shape and everything’s done. It’s going to take the repairs and maintenance and take it from eight percent and I’m going to make it two percent property management. I’m an impeccably property management, so I’m not going to put the 10 percent in. I’m going to put zero. So I would take I would be able to do. I was so good. I’d take a negative cash flow in property and turn into a positive cash flow property like that within the stroke of a pen. And next thing you know, I buy the property. So that was another mistake and I got lost.
Rob Break [00:30:49] That’s probably one of the bigger ones, I would say. And a lot of people are guilty of that. I mean, all of I’ll sometimes even do it now, like on initial spreadsheet and then kind of look back on it and go, you know what? Now we should probably change some of these numbers.
Jared Hope [00:31:04] Yeah.
Sandy Mackay [00:31:04] So I was at I was at
Jared Hope [00:31:06] a workshop for this organization a couple of years ago, and they were telling people out of Vancouver. They were telling people to. It’s OK to buy properties at a negative 50 or negative 100 or negative one hundred and fifty dollars a month cash. It was OK because you’re going to get appreciation and you’re going to get mortgage pay down. That was their story. And I’m sitting in this room, I’m like, No. So I went on this big rant on social media two years ago saying, do not ever buy a negative cash linked property. It will destroy you. It’s not. It’s not a question of if it’s a question of when. And, you know, and that was a lesson that I taught myself because I was buying negative cash flow properties and then, you know, like I was, I always believe I was taught something different, but I always believe that you always buy for cash flow first and you want to talk about big mistake. This is one of them. I wasn’t buying for cash flow. You always buy for cash flow. And then the second thing you buy for is mortgage pay down. Because those two things you can almost you can. You can kind of guarantee those you can work those around in and always have that. The third thing you buy for is appreciation. That’s the unknown. You know, like, you know, no one predicted 2008 09 10 or very few people did. No one predicted a pandemic. You know, what’s the outcome of the pandemic? We still don’t know you guys. You know, once the CRB comes off, everyone’s so many. There’s something like 800000 or a million people have deferred their mortgages. Once that comes off, like everyone’s, these banks are predicting that foreclosures are going to go up. Once these deferrals come back, these deferrals are going to come back. So all of these people who do further mortgages once again, this is all a big lesson. Some of the big lessons that I’ve learned, but all these people who have deferred their mortgages. I am one of them. I’ve deferred about 50 mortgages. I have a different plan for deferring them than others. But so all these people to further mortgages six months later, their mortgage payments start back up. Well, what happens while their payments are now 100 or 200 dollars higher? Their payments, not the same, so in a negative cash flowing position. Six months later, mortgages come back on, and now they’re in a worse two negative cash position in Ontario. You can only raise rents, what, two percent, two point something percent. So if rents drop by $500 because vacancy rate, that’s what’s going to happen. But I don’t see it. That’s what’s going to happen. But that’s a possibility of what could happen, a strong possibility. So if rents drop by $500, deferral rates go up or your payment goes up $200, it’s going to take you 20 years to recover at two percent increases. And that’s not including property taxes that are going to go up. So if you’re if you’re not buying for cash flow, you’re I think you’re playing with fire. And that’s what I was doing.
Rob Break [00:33:59] Yeah, those are all really good points here. And I think that I mean, I don’t think people are actually going to understand the impact of how those things affect. Did you really like because you’ve managed to get through them? So what tactics? Let’s talk about that. What tactics did you use to overcome these things?
Jared Hope [00:34:21] Oh, did. In 2010, I come out of the 2008 09 recession. We restructured like literally the only out of all the years I’ve been doing real estate. I’ve only sold out of my buy and hold. I’ve always turned properties over. Look, I’ve always I buy properties renovated and sold them. I’ve been doing that since 2010 2011, but I’ve always had my, my, my, my holds, my holding, my holding properties. I’ve always had them. And out of those properties, I’ve maybe I’ve sold three or over the last, however many years, like when I buy a property, it’s like, OK, I’m going in this box, which is my hold that’s going in this box, which is made my turnover in two thousand and eight. Coming out of it, I had to, you know, we had to restructure stuff. So in 2010, we started flipping because we have to drive revenue. We started up our property manager, our first creation, our first run at our property management company, which back then was called Landlord Rescue, which is now called Til Property Group. We have to get liquid because what I realized was my portfolio was not recession proof. So one of the mistakes that I made, another mistake that I did is every, every five years as refinancing my portfolio. So to this day, I don’t refinance my portfolio. I will never refinance my portfolio. I will never take equity out of my portfolio because it’s a tale of the two portfolios. These are the two portfolios. I have one portfolio called Hold Properties. My last name is hope. So whole properties. I have about fifty-five properties in that portfolio. I have in two thousand and three. I started buying in 2008. I refinanced, I think five or eight of them. But the rest I’ve never touched. I have another portfolio. Let’s call it JP because I have a partner. I had a partner there. I just bought him out. We refinanced and we got about 30 properties in there. I refinanced. We’ve refinanced those ones every five years. So in 2008 we refinanced it and in 2015 we refinanced it. So what happened in 2008? Recession comes all that cash flow or all that mortgages we bought down, we brought it back up. Rents came down. So we were we were losing money. Fast forward to 2015 and 2016. We had another recession here in Alberta, so the same thing happened. So yes, we’re pulling out money. I was taking that money, paying down my whole property portfolio. My partner was taking that money and who knows what? I don’t know what he was doing with it. So we kept on running tight, leveraged out. So what people need to understand is in real estate is after five years, you don’t have enough mortgage paid out on to experience an increase in cash flow. It just doesn’t happen because banks shorten your amortization rate along with the payments, so your payment actually stays relatively consistent after five years. After 10 years, though, because your first five years, first 10 years, most of your payment go off your interest. Yeah. Excuse me. So after 10 years, you have enough principal pay down that when you refinance or sorry, when you redo renew your mortgage, you have enough principal pay down that you actually see a two or three hundred dollar drop in rent. That is the that’s the rounding point. That’s the finance that you have to climb. So back to the whole property portfolio never refinanced it. So after 10 years, so that puts us to 2013, we were making bank in from out of 2013 because in this 50, 45, 50 property portfolio, it was like 50 percent paid off because we were just hammering that hammering that hammering debt. So then what we did is I renewed all my mortgages and my payments could have gone from a thousand to $700, for example, but I kept my payments at a thousand. So now it’s paying in an additional $300 times. 50 properties say it numbers were different all over the place. Let’s use that for in and out kind of a snapshot picture. So we reduced the $300, but we kept the payments at $300 times 50. So all of a sudden forward fast five years later, which is 2018, I renew my mortgage is again. Now I just built a bigger gap to the point where now my cash were just so flush with cash flow from property all properties. This other portfolio has almost the same amount of debt in it that we did back in 2003. My payments the same, my leverage is the same. Everything’s the same. I have a JV partner in one of these. And this is a long story. I know, but I have a good partner in one of these portfolios as well. I have one job partner left. I called him up a little while ago. He was like, What the heck man we are like, how do we sell these things? We can’t sell these things. You know, you’re telling me that if we sell them, we’re going to be break even. Well, no, that’s not true because I’ve. Finance them three times, I like to remortgage them. I pulled the equity of three times. I’m like, Dude, I’ve paid you three $400000 because he gets out. I’m like, Dude, I’ve paid you three or four hundred thousand dollars over the last 15 years, but they don’t remember that. All they see is here is what we what it’s worth. Here’s what we owe when we sell. I lost money. You know, so there’s so many rules with how to run a job and how to structure the job that prevents problems. Fifteen years ago and one of them is don’t refinance your properties.
Rob Break [00:39:58] I think that’s sort of multi-tiered in that when you’re in growth phase, obviously, that that can be very powerful right forward, even for what you were saying is you took the payouts from remortgaging and used it on your other portfolio where maybe, maybe someone might someone else might not do that, but you did the smart thing. So in a way, that was a very powerful tool for you. Oh yeah. Being able to take money from one side and put it to use on the other side,
Jared Hope [00:40:30] I go, you know, I would do it a little bit differently if I was handing out checks again. I would go back to my JV partner and say, Listen, Mr. JV partner, listen, Rob and Sandy. Listen, man, guys, I would love to cut you a quarterly check every year, and that’s super cool. Would it feel so good? But what we’re going to do is this instead, we’re going to wait to the end of the year and at the end of the year, you know, we’re going to have $20000 or we’re not $50000 in this bank account and we’re going to cut out. We’re going to take 50 percent of it and we’re going to pay 50 percent of that out. The other 50 percent is going to stay in the bank and we’re just going to leave it there and we’re not going to touch it. We’re not going to do anything. We’re just going to leave it there. That’s because that’s protecting the portfolio that’s going to prevent cash call. That’s going to keep, you know, it’s going to keep them sane because they’re going to get some, some return on their money. But more importantly, it protects the portfolio. The other thing I would probably do like I’m all for leverage, like I don’t want people to hear this and say, Oh, I can’t. I don’t want to refinance to build. Yeah, it’s OK to refinance and build your portfolio. But I think there’s a tipping point, you know, like I was doing it all the time, which leverage the shit out of us. Leveraging to grow its leveraging and buying the right properties is fine. But at some point, in time, there has to come a tipping point where it’s like, OK, I’ve done enough. Now I have to change the way I’m buying or the change, the way I’m building my portfolio to protect the assets. Because, you know, if the loser in 2008, guys, I saw 2008 nine 10. I saw so many people who had 20, 30, 40, 50 properties go bankrupt. And you know, I look at the rooms I used to hang out with and the rooms I’d hang out in, you know, come 2010 11. All the big players, not all of them, but a lot of them were kind of a lot of the people I thought were big players were gone. And in 2016 17. Same thing in Alberta. And I guarantee you in two years there will be people who are 30, 40, 50 properties that will not be in the scene anymore because they play the game wrong. They’re too leveraged. So I just don’t believe in leverage anymore. Too much leverage. Let me say that again, I love leverage because I think that’s how you have to play the game. But there comes a time where it’s like, I got to change the way I’m playing.
Rob Break [00:42:48] Yeah, and I guess it’d be like taking each one into sort of its own consideration because, you know, I was at a here’s a perfect example of what you’re talking about last summer. We did, you know, a bear. We added a basement suite. And then when we refinanced, we were able to get a bunch of money back out of the property right on top. And I said to my partner, why don’t we just, you know, go for, you know, we’ll just. Go for even. Right? Get our money back and leave the rest. He’s like, hey, why would we do that? Look, we get extra money for buying the house. We’re not going to do that. So. So, you know, I think if I had pushed a little bit harder, we probably could have done that. And I think that would be the safe way to go on something like that, right?
Jared Hope [00:43:36] You know, that’s a great point, Rob, because I have coaching clients and one of my coaching clients, they’re doing the. And I and I love the verb, I love the verb method. The problem, a problem with the birds because you don’t really know what the future value is, you’re assuming it, but you don’t really know you’re at the mercy of the market. And I’ll get to that in a second, but I have this coaching client. She’s in her 50s, mid 50s, and so her level of risk should be lower than our level of risk. And because her runway is shorter to earn it back with, if she loses anything and her level of conference different her, her risk factors are different for her desired outcomes are different. She’s, you know, typically at 55 60, you’re slowing down in age, so you want more cash flow, more cash to play with. And so what I told her, I said, listen, instead of refinancing and pulling 80 percent out, refinance it and pull like sixty five percent out and leave 40 35, 40 percent of equity in the house because now your cash flow is going to be a lot higher. And now, instead of having to refinance or refinance and keep being really thin on your cash flow, now just go to three or four of these to keep your head, get your cash flow to about four or $5000 a month and then retire. And then you’re good, because now you’re not at the risk of the market, you’re protected, your income’s not going to change. If the market shifts, your lifestyle is not going to change if anything happens. And now you guys, you’re pandemic proof. Versus recession, recession-proof now there’s a whole new there’s no such thing. I used to me used to try to be recession proof and going into the pandemic, I’m like, Holy shit, I think I was shooting my pants like, I’m like, oh my God, I’m going to go, I’m going to go, I’m gonna go tits up right now. But now my portfolio is pandemic proof. And that’s what I was, the advice I gave to this client so that I do the exact advice I gave you. I don’t know. I don’t know if I would do everyone like that, but why not do every second one like that where you’re building this big brother, you’re building this bodyguard that’s going to protect your portfolio, which protects your life. It’s not about protecting your portfolio; it’s about protecting your lifestyle and your life. That’s what real estate does.
Rob Break [00:45:51] And I guess there’s not really any cut and dry. We can’t just say here the answer to that question, and here’s the answer it’s more of like you were talking about being coachable. And so, you know, in that person’s specific case that you were just talking about your coaching client, that might have been the best thing for her to do. It might be different for somebody else is it all just depends on where they’re at and if they’re able to get good advice, run with it.
Jared Hope [00:46:21] So this is why I think people need coaches versus going to going to rooms. So you go to a room and everyone’s in that room to learn and listen and build a business, so they’ll sit there and hear, you know, like there’s no clear-cut way how to do it. I have my way of doing it. And so the mistake I think made back in the day when I was presenting, I was very condescending, like I was. It’s like I was telling people this was the only way to do it when what I realized is my way is just my way. You’re always, you’re a wave Sandy wave and is way and John’s way, John’s way and so on and so on. And the mistake people make when they go to a room and they listen to 10 speakers in a day, for example, or in a weekend is they try to follow each and every one of them and they sit there, and they get my. That’s how you do it. Oh my God, that’s how you do know. That’s how you do it. So they kind of are chasing a squirrel. Whereas if you had a coach mentor like I did back in 2005 with my clients are using me for is. Our job is to say, Listen, OK, I get all that. Here’s the path you need to stay on, you know, like, go learn that goal. Learn this. But here is Plan a Plan B Plan C. Here’s your main tool maybe your main tools of bur. Maybe your main tools are bought and hold. Maybe remain tools, jobs. Maybe your main tool is, you know, renovating flip windows, but you need the guidance because if an untrained mind makes up the wrong result and it create their own path. So that’s one of the benefits of following somebody who knows what they’re doing.
Rob Break [00:47:49] Yeah, exactly. And that sort of falls in the thing that Sandy and I get asked this question all the time. It’s like, how do you structure a deal?
Jared Hope [00:47:56] Tell us how it was done. There’s only one way.
Rob Break [00:48:00] Yeah, yeah. And yeah, so let’s actually let’s use that to transition into the JV horror stories that so they know that I know that you had something you wanted to touch on as far as that goes.
Jared Hope [00:48:13] Oh, I mean, once again, I got like, you know, like a couple. One big horror story is I refinance properties on a regular basis, and for my debut because I felt obligated to make the money and I felt obligated for them not to lose. And so by refinancing the properties and getting their money back, you know, I thought that was the right way to do it. And what I realized over the years is it’s a balancing act of, you know, here’s some money back that covers it, because most guys, let’s face it, most guys are not using cash to invest or using a line of credit. And so there is there is. I do feel that onus is on me a little bit to have the portfolio cover some of those payments, if not all those payments. So now the way I restructured that is, you know, I’ll take 50 percent. Like I said earlier, I’ll take 50 percent leaving the bank. The other 50 percent gets split 50 50. And then that 50 percent of that 50 percent that remains in the bank will target one property and we’ll just start buying down the debt for that one property. Another change that I’ve made is I don’t do five-year deals anymore. I was taught a long time ago to do five-year joint venture deals. So when we signed a contract as a five-year deal, now I do eight or I do 12 10-to-12-year deals, not five-year deals. And then at the eight-year mark, I re analyze the portfolio to see if there’s any properties that can move out because it’s cold calling the herd. So we want a buffalo ranch up in northern Alberta with my in-laws. We have a bunch of bison, and you know, I started watching my father-in-law back in 2010. We’re sitting around the dinner and he’s like, you know, we got to call the herd. I’m like, what does that mean? So he’s getting rid of the old cows. And because the old cows will produce that, say, 70 percent or 70 percent of the time, they’ll have a calf, whereas the younger cows will produce at 100 percent or 95 percent. So he’s getting rid of the old cows and bringing in the new cows to increases herd. So I’m seeing them with that makes total sense. So at the eight-year mark, I’ll sit there with my GPS, and we’ll call the herd if we can. So we’ll sit there and say, okay, you know what? This one is not producing like it used to or this one’s, you know, this still has wow factor. But in about five years, we have to replace furnaces, windows, roofs, some big expanses. We’re going to call that out right now. We’re going to take that mortgage. We’re going to port it to a new house that you can port mortgages easier than you can qualify for mortgage in order to qualify for a new mortgage. So we’re going to port that mortgage over here to this new house that’s going to have higher cash flow, less long-term expenses. So instead of doing the five-year term, what I realized with five-year terms as I’m at the affect when I’m at the mercy of their life. So if things change in five years and they come back and say, I need to sell, I need my money back in five years, and if I’m not ready to sell, I’m screwed. So if I do a 10, 12 year, I’ve changed the thought process and the energy around that contract so that they know it’s a 10-year, 12-year contract, so they actually don’t expect to get out for 10 to 12 years. So but and that’s what that does is it puts me more in control of managing and stewarding the success of the portfolio, which guarantees almost a good outcome for my job partner because if I can get if I can keep them in for 12 years, never refinance. I’ve got mortgage pay down over the next 12 years at an average of 8000 $9000 a year. So guaranteed I got their money back to the worst-case scenario after five years. You don’t have that guarantee. So the biggest the biggest takeaway that I’ve learned over the years is that it is a 10 12-year window. And then I do it. I take it on gives just for the sake of taking on, gives in and I’ve taken on the wrong JVs. I’ve taken on entities that thought they knew more than me. You know, like it’s been tough dealing with JB partners to the point where I’m very strict on the job that I take on now. The After-X amount of capital out of, you know, little to no involvement in the portfolio. They have to know how to read a financial statement because lots of people don’t know how to read financial statements. And at the end of the day, they have to have the same core values as me and my family. So those are some big takeaways for joint venture structuring.
Sandy Mackay [00:52:45] Those are alpha, those are awesome, really like those, those are a couple of different ones there than we typically here, so that’s really cooled to hear. Thanks for that.
Jared Hope [00:52:53] Yeah. I’m not, you know, once again, it’s just my way, you know, it’s just my way of doing things over the years that I’ve been burnt by and I’ve been, you know, I’ve taken some hard lessons from JV’s over the years.
Rob Break [00:53:05] Well, I think the tough thing is that, you know, people that haven’t done any JV deals, especially that are listening to this are going to say, well, you know. But I just I would just be happy if someone was going to give me money. And, you know, that’s again, like even the wrong way to look at looking for joint venture partners in the first place is more, you’re providing an opportunity to them. If they want to take it, then you can structure it with all those things in place that you’ve said, you know, and it’s not going to be any less desirable than it would be if you said, you know, you’re going to have more control over it or whatever, you’re going to find the right person as long as the deal’s good. Yeah. Well, I think that that’s really what people got to focus on, especially if you’re just getting out is the deal that I have good enough that regardless of if I set this up so that it’s going to be less of a headache down the road and set me up for learning how to structure these going forward, then you know, you’re not going to have any trouble finding it. And it’s not asking for money. It’s offering opportunity, right?
Jared Hope [00:54:12] Yeah, you know, I would even go one step further. I get it. I totally get what you’re saying. I would actually, I think, maybe disagree with you a little bit on that. I think people, I don’t I don’t think it’s both a deal, to be honest with you. I think the deal is like the bodyguard is the protector that has to be there, but that speaks to the integrity of me or you or the JV partner, the actual, you know, the real estate expert bringing the deal that speaks to their integrity. You know, like there’s groups out there that are, you know, they’ll sit there and say, fear stops most people from doing anything, you know, fear you have to go conquer the fear of the potential money person. You got to go solve all of their fear. And that’s all bullshit, to be totally honest, because people do business with people they trust. Plain and simple. And I could have the most knowledge in the world. But yet, Rob, you’re the friendliest guy. You’re so trustworthy in your knowledge base is smaller, but you’re super trustable to that potential person. They’ll do business with you versus doing business with me. People do business with people they trust the most. And that’s emotion. So people do as much as they try to make a business decision and keep it all simple. Cuz here’s all the facts. Emotion comes in. And what I teach my clients is you have to also feed, but you have to build off of that emotion that they have and then enter through trust and accountability and loyalty and relatability. Because the product is going to sell itself, the product is going to tie all of these emotions that this person has about you and they’re going to store the products, going to solidify it. It’s going to it’s going to close the deal for you. You know, like I see people all the time. I have clients all the time to come in and say, you know, I want to start brandy, I want to start marketing. I want to start putting stuff on Facebook. I won’t start. I’m like, why? What’s the point? Any clients? No, that’s not how you’re going to get 80 clients putting a deal up and saying, hey, I need I need an investor that doesn’t work because you have no credibility. Let’s go work at building credibility with your inner circle that they trust you. And they truly believe that if they give you $100000 that you’re going to act in the best interest of them with it. That is what people need to work on. And that starts with understanding what your why is, what your purpose is, what you’re calling is understanding what your client’s purpose is and what their why is and what they want out of it. It’s not. Here’s the property, and here’s how we’re going to solve everything what people teach. It’s about understanding how you show up is either repelling or attracting a J.V. partner. Work on how you show up. Because that is what brings in the people to do business with you, whether it’s shoes, whether it’s cars, whether it’s how was his money, whatever it is, that’s how you show up. You want to go, you want to go, you want to go meet a girl or meet a spouse. Well, look how you show up. We look where you’re showing up. Look how you’re interrupting and how you communicate, are you trustworthy? That is what brings in a partner, not the deal, I think,
Rob Break [00:57:22] yeah, I think very well.
Sandy Mackay [00:57:25] So what do you disagree? Let’s get some
Jared Hope [00:57:27] other, you know, like, I guess, you know, it’s
Rob Break [00:57:30] just it’s such a complicated thing. And I was more I was more sort of alluding to the fact that like having the deal or build confidence in the person, right? And then they’re not necessarily feeling like they’re asking for money to just go out and find something that was more the idea of just believing in yourself. And I mean, all of those other things that you were talking about definitely come into play like how a person is going to hit. I have no idea necessarily how each individual is going to handle someone else’s money and whether they’re going to do it with integrity or not. But that’s just an assumption that I’m taking on. My part as far as a jayvee agreement goes, is that whoever is handling the money is going to do that in an ethical fashion. But I guess that’s not always the case either.
Jared Hope [00:58:20] No, do like it’s like there’s so many douchebags out there, man. You know, there’s so many people who are lacking integrity in finding that right JV partner to align with you tough, you know, and it’s just like in saying all of that, though, if I were building my portfolio again, I would 100 percent deal with all these, you know, JV partners structured. My way, like the way I do it, if I were doing it again, all my jobs would have success, and all over the years I’ve had 10 GB partners and I can only think of one GB partner that has had success in real estate and would walk away saying, Yeah, that was a that was a win. That was good. All the other JVs, I still have one, but all the other JVs. I bet you all of them would never get back into real estate because it was a five-year plan. Set them up wrong as cash flowing. Are being cash flow wrong? I think it was all structured wrong. You know, one guy was paying interest payments for the other guy wasn’t like it was just, there’s just no structure to it. Whereas now if I were to do build my portfolio again, I would 100 percent do it with their money versus using my money. But I would almost like I say, I’d stretch it out and I’d make it up for success on these JV partners just by extending the timeline.
Rob Break [00:59:39] OK, well, we’re getting a little long here, but I want to talk about your coaching course. Tell us a little bit about that. You’ve just opened up, you’ve just launched a new coaching course, right?
Jared Hope [00:59:47] Yeah, we’ve been doing it for about three years, but we’ve been running it through stealth, whereas now we’re actually branding the new website, which will be launched in the car for months. We’ve put about 55 60 clients through it. So it’s Chris and me. So, Chris, that, you know, everyone looks at me like, I’m the face of the company, I’m the face of the brand, I’m the face of the real estate. But the truth is, Chris and I had done it together. She started us on the journey, and you know, the easiest way I can summer summarize it is I help people become millionaires. Krista helps them maintain their money and their assets and their wealth. And so Krista is one of the best personal coaches I’ve ever met in my life. And the mistake people make is, you know, they don’t focus on both if they’re focused on one or the other. And whereas what we do is it’s kind of like a 60:40 split that it’s going to be, you know, sometimes 60 percent real estate, sometimes 60 percent growth and personal development. So I’ll couple work. If you’re single, you can still do it too. But you know, it’s husband and wife because we believe that in order to have the success in real estate, both people have to be doing it. Both people don’t have to be buying the property, but both people should be along for the ride. And so that’s how to communicate, how to structure, how to set it up. So you both are involved and you’re both still, you know, speaking the same language and getting ultimately getting, you know, the love that you want out of life. So that’s the coaching program.
Rob Break [01:01:11] OK, so where would they go to learn about that?
Jared Hope [01:01:14] Right now? You can go to Tilt Group. Okay, and then there’s going to be a tab that says investments coaching so you can click that tab. And then in a couple of months are Jared and Krista. Holcomb will be up and running. We’re just in the process of doing and pitchers and stuff like that for the website.
Rob Break [01:01:35] OK, who looking forward to that and anyone who missed that can go to the go to the show notes and the link will be there.
Sandy Mackay [01:01:44] Rob, before we sign off, let’s go, let’s go. There’s a list of really interesting property management stories. Let’s go. Can we get one kind of the interesting? There’s some of the names of stuff about strippers. Can I tell you to?
Jared Hope [01:01:57] Yeah, I have this house in Grand Prairie. So in 2008, I take over the management of this property and I knew nothing. I just as young, cocky kid and I take over the manager’s property and I rent out to five strippers. And I’m just like, They’re in. They cash. There are hot. This is perfect. And so whatever. So I was up in a few months later checking on the house, and I left them on a notice on the door saying, I’m going to come back tomorrow. So I come back the next day to do an inspection and as I knock on the door and all these cars in the parking lot or on their driveway. And it’s a duplex and not a knock on the door. And no one answered a knock on the door open. And I’m like, hello, Jared, hope here. I left the notice, and I can hear some music playing, but no one’s home. That’s what I thought, because no one answered the door, and it was a bi level. So there six stairs up, six stairs down. I walk inside, I walk up the stairs and there are five naked girls on the couches. And there’s Kolb there and there’s blues, there’s toys. There’s all this stuff and I walk in there. I’m like, Yeah, I’ll just come back tomorrow. It was just it was like I walked out of there. I’m like, that was so cool, but I’m like, Yeah, I can’t rent, and they can’t rent. Like, I got to do a better job screening properties like they are screening tenants. So that’s one. I guess you’re three. I have another one. I bought this house is my second house I ever bought. I knew nothing about landlords. And they rented. So we bought this house, and it blew windows and all this other stuff. So we were fixing it. So my wife and I were out there paying the windows and, you know, was fixing the floor and changing the toilets. And we’re doing some work, put lipstick and rooster and this lady and we with this big post-it note in the window saying, Hey, three-bedroom main floor, here’s the rent. Like everything was written down on this post-it note in the window. The van pulls up and this lady gets out. This blue van pulls up and this lady gets out wearing a red dress and cross on her necklace. And she was toting along three little kids and her name was Rosa. And Rosa comes up to me and she’s like, hey, you know, I just want to get your house. We just came from church as the Sun just came from church. My kids were in Sunday school. My, my husband, Eric, Eric, and Rosa. You know, he just lost his job. And but, you know, we’re just starting, we’re just starting out, you know, blah blah blah blah blah. And I’m like, oh, he just came from church. Nice score. God sent God, sent them everywhere. Rent it to them. Eight months later, they were behind about three months on rent. Finally, this one night I went there at eight o’clock at night and I was so mad because I was getting the runaround, like getting the runaround from Eric and Rosa knocked on their door. He opened up the door. I reached in. I grabbed him by his ear, and I pulled him out like I pulled him out of the house, and I told him, you know, I said, Dude, if I’m going to come back in two hours and if you’re not gone, I don’t know what I’m going to do, but I’m probably gonna kick the shit out. You came back two hours later; everything was gone out of the house. Thank God, because I don’t, I really don’t know what I would have done. It was terrible. Third story, I had this. I had this client, this tenant.
Rob Break [01:05:27] Is that how you handle things? Still, is that your property? No, no,
Jared Hope [01:05:32] no, man. No, dude. It was. You know what? I just didn’t know anything. You know, I didn’t understand the Tenant Act. I didn’t understand rules and regulations. I didn’t know how to interact with people. To me, they were stealing from me, right? And I was so emotionally I was just pure emotion versus, you know, the Tenant Act in Alberta is very good. Like, I can kick someone out in 14 days. I guess there’s no end finds an hour, four hours or whatever you guys have in Ontario. We don’t have that stuff in Alberta. It’s literally the Wild West. I can get someone out in 14 days and anyways, I have this house up in the sky to have a great tenant. This guy was amazing. Can I have another one I can share with you, too? This guy was an amazing tenant, and he had a party, and at this party, some guy at this party pulls out a knife. And whatever it’s like, 2:00 in the morning, 1:00 in the morning, pulled out a knife, anyways, they kick them out, so they kick this guy out. Whatever they continue to party at 5:30 in the morning, this guy rolls back. Everyone’s passed out. This guy rolls back to the house, knocks on the door, and as he comes to the door, as my tenant comes to the door, there’s a big window in the door. It’s all frosted. But as you can see, the shadow coming up. My tenant goes to grab the door and a bullet goes through and shoots him in the stomach. Guy kicks open the door, pop, pop, pop, pop start should start shooting. Didn’t hurt, didn’t kill anybody, but got my take on it. Guy takes off. So this guy that they kicked out was high and all this other stuff came back with a gun and started popping people, right? So that’s a horror story. Here’s the best horror story.
Rob Break [01:07:13] Okay, so you could top that.
Sandy Mackay [01:07:17] That’s pretty good. Yeah, I don’t know.
Jared Hope [01:07:19] This one’s a good one. So, you know, 2000, in 2008, I have a tenant that didn’t pay rent, got behind, gave them a notice. And nine times out of 10, they leave nine times out of 10 years. And not if they just leave because, you know, it wouldn’t just take appropriate and or mostly take it in. So I give the notice, I come back. She’s not done after 14 days, so I changed the locks and so she comes back, so I waited till she’s gone to work. I changed the locks and once again, I don’t really know the candidate at this point in time because I’ve never had to really go the distance with the tenant. And so she changed. I changed the locks. She comes back. She calls the police. Police come and the police don’t really have a jurisdiction, any rights with the landlord tenant, but they can’t. If there’s not abuse or violence, they don’t know the laws from the Terror Act. So the police come in like, no, you got to give her back the keys. I’m like, no, I don’t like just you’re. There’s no crime. There’s no abuse, there’s no weapons. I just get out of here like, you don’t know what you’re talking about to this police officer. This RCMP anyway, make a long story short, I give the keys back as a police officer said I had to. I didn’t know that. And so I give the kids back in. The tenant says to the cop, tells me that I he’s like, I guarantee you she guarantee should be. She’ll be out tomorrow by 5:00 o’clock. So the next day comes I didn’t. I gave her an extra day. So I go back the next day. So two days later, she’s gone, which is awesome. But I open up the door to the to the side of the house. So the bi level, can I open up the door? I go through four or five steps down, two feet of water in my in my basement. She plugged the drain, she cut all my lines, plugged the toilet, plug the tubs, ran the tubs, everything was overflowing. So I’m like, Oh my God, like a panicking, right? I go upstairs. My floor is collapsed into the basement. That’s how much water they just saturated everything. One hundred and seventy-eight thousand dollars’ worth of damage to my property. Insurance claim insurance, yeah, yeah, so the best part about that is, I don’t know, real insurance. My insurance cover the lost rent for eight months. I have a brand-new product, you know, that was in 2008, so that now that’s, you know, 12 years old. I got news for I got everything new. Everything was brand new. My value went up. I refinanced that property, bought the property next door to it. So now on both sides, it was great. You know, that was a terrible experience, but it worked out.
Sandy Mackay [01:09:58] Some of the best stories, if you have property management, experience those amazing stories there. We have my own, my wife, Kaye runs our management company. It’s crazy. Some of the stuff you come home with isn’t some of the best stories in life. I would say,
Jared Hope [01:10:09] Oh my god, I the tenant the other day calling me up. So the shower door broke off of one of my places, and this deals with the stuff. I don’t deal with it anymore, but my staff called me up. They’re like, Yeah, your tenant doesn’t want to pay July rent, but I’m like, why? Like, what’s going on? While the shower door broke off? So he feels that it’s, you know, you shouldn’t, should not be around the rent like thirty-eight hundred dollars. And I’m like, no, because he broke out the first of all. And secondly, tell him if you if that’s the case, I will pro-rate a reduced rent. And so and so my staff are like, Okay, well, what’s the pro-rated random like? Take one cent off, so take off one penny off of his rent, and that’s the pro-rated rent that he doesn’t have to pay it off. Bullshit tenants do the funniest things, then
Sandy Mackay [01:10:57] it is pretty comical sometimes. And ultimately, I mean, insurance covers you for a lot of things. So a lot of these stories are kind of scary for people. But then ultimately the end result of that one was pretty, actually pretty positive for you. Well, I think over that stuff at the end of the day, like all these other things, what’s maybe the wrap up, I guess, and there are a lot of horror stories. They shared those ones; they end up pretty wild. How do you kind of get past that mentally?
Jared Hope [01:11:21] Great question. Great question. I’ll answer this way. All that stuff is just stuff, you know, like every day at work. Stuff happens to people. Every day in life. Stuff happens to people. And if I were to quit in 2008, when that place flooded, if I would have quit in 2007, when that shot went through the window or through the door. If I were to quit in 2006, when I found 25 grow plants, marijuana plants in my basement suite, I would not have the life I have today. And you know, it’s funny. Like, I talk to people all the time and they’re like, I want to do this, and I want this, and I want this. They talk about this, these superficial things like, you know, whether you call it a believes or purpose or what you’re after, everyone ties it to material stuff. I want to portion; I want I want money. I want. I want to make $10000 a month. Well, the truth is that’s not there’s not enough meat on that for you to sink into that will keep you going when times get tough. You know, what I always wanted was to give my kids a life that I never had. So if I want it like that was meat that wasn’t money that wasn’t, you know, that wasn’t fancy cars or toys and shit like that. I wanted to give my kids the life that I never had, and I had a great life. But I want them to experience different things than I did. And in order for me to do that, there is times I’ve got tough and I just it was just stuff. And what we did every time I learned something when what I what I mean by learning is every time something happened to me, like the flood, the pot plants, the shootings, the strippers, the nonpayment of rent, the shower door guy. Every time something happens, it’s like, OK, how do I prevent that from happening again? What lessons do I learn to make the system better? Because if I see things two or three times, it’s like, Oh, that’s a pattern. I got to fix that because I don’t want that to keep on showing up. I think people get into real estate for the wrong reasons. I think they get in thinking that’s going to be an easy ride, and they don’t understand how the times are tough and then they buy into the story. I have a friend of a friend of a friend who said this. Mm-Hmm. Oh, well, that’s not. That’s not true. There’s a version of that. That’s true. But let’s talk about the friend of the friend of a friend that did it wrong. Because there’s all kinds of stories like I don’t have people trashing my house anymore, I don’t have, you know, come April 1st, we have five hundred and twenty-six tenants on April 1st, but pandemic guys, we had 520 tenants pay rent, 520 tenants pay rent. By April 20th, we had five hundred twenty-six tenants to get rent. On May 1st, we had 535 tenants, 535 tenants paid rent me first. So you know, for every bad story, there’s a thousand good ones, but everyone focuses on the bad. So to answer your question Sandy, I know it’s a long winded. It’s just stuff and don’t get attached to stuff and situations that happen. Because if your goal or if your purpose is big, bigger than money and fancy cars and this lifestyle, you’ll always smash through it to have success on the other side of that total area.
Rob Break [01:14:26] Oh yeah. What’s next for you? Let’s wrap it up with that.
Jared Hope [01:14:32] Oh man. Oh jeez. Personally, we’re moving to the lake. We’re trying to sell our house. So if anyone wants to buy a house in corner, come on it. That’s a great $1.7 million house. I’ll give you a deal of the commissioner. Sorry, giving I won’t know. You know what? I, see? My kids are 15 and 13 years old and what I’ve realized, I realize it now that my kids are grown up and I missed, you know, I started buying real estate in 2003. In 2005, we had our first kid. I bought 65 properties, 64 properties in 2005 and I’m, you know, and I kept on going about 32 the next year, about 20 something. The next year I just kept on going and I’m at, you know, it’s finally started. My kid makes my kid the other day with surging up Dolly Parton. I’m working nine to five, so she’s looking up this song. But he was searching. I’m working five to nine and I’m like, why? Five to nine 12 is 13 years old and liquefied the 90s. Like, well, that’s you know, that’s the workweek five nine. And I’m like, what? When we mean the night at five and eight and nine at night? And I’m like, well, that’s interesting, because I typically will make my kid come home from school or hockey or whatever, because they will go to the academy, and they’ll see me working on the phone or on the computer these hours. But during the day, I don’t work. I’m hanging out with my wife or going to the bowl. We’re watching the kids to hockey like I’m at all. Their events looks pretty good, you know. So what’s next is to continue nurturing the relationship with my kids, and because they’re at this, they’re at this age now at 15 and 13 and start dating and they’re going to start experiencing things differently, and they’re going to start like setting their future path. And I want to be a part of the game and, you know, the real estate still going, we’re still growing. We’re still building, we’re still doing the coaching thing, which so much fun. But that’s what’s next for us is to really honor our relationship and what we’ve done in our lives, my wife and I, and really instill some of these core values into our kids.
Rob Break [01:16:32] Awesome, awesome stuff, man, I wish you all the best in that. If anyone is looking for it’s actually 1.8 million money. Yeah. And I just want to say Carla says that she loves your stories. So I away from Carl on Facebook. Right on. OK, well, Jared, Ben, thanks a lot for sharing all this stuff. I really enjoyed this has been super fun. So thanks.
Jared Hope [01:16:59] Yeah. Guys, this was awesome. I love your show. Like, you guys are rocking out, so keep it up
Rob Break [01:17:05] and people want to reach you the best for you.
Jared Hope [01:17:08] Yeah. So Facebook, I love Facebook, which is still a proper group. Our website is still group. Okay? Or you guys can e-mail me directly, Jared already at Tilt Group dot com.
Rob Break [01:17:21] Nice and easy. And again, those will be on our on our page. So anyone that missed that can just go over there and all the links will be there. Sandy How can people get in touch with you?
Sandy Mackay [01:17:30] I mean, Facebook’s great to, I guess, start saying Facebook, because that’s really two eight nine three nine six eight four six works or in Fort McHenry, the network icon.
Rob Break [01:17:39] You can reach me at Rob at Mr. Breakthrough. Okay. All right, everybody. Thanks for joining us. We’ll see you next time.
Jared Hope [01:17:46] That’s. Now.