Table of Contents
Sandy Mackay [00:01:02] Breakthrough Real Estate Investing Podcast Episode Ninety-Three.
Rob Break [00:01:25] Hello and welcome to the Breakthrough Real Estate Investing podcast, we put the show together to inspire you and help you break through to the life that you want to live through the power of real estate investing. My name is Rob Break, and here with me again is. MRN Mr. Sandy McKay,
Sandy Mackay [00:01:45] Yeah, Hey Rob. How are you doing today?
Rob Break [00:01:48] Good. How are you?
Sandy Mackay [00:01:50] I am awesome.
Rob Break [00:01:52] Awesome. Why are you awesome?
Sandy Mackay [00:01:57] Why am I asked him is July in Canada? Weather’s good. You know, we’ve got a couple of months to savor that and enjoy us and we’re here again talking real estate. That’s always fun. Couple of great guests on standby here, ready to roll. And what else? Nothing to complain about.
Rob Break [00:02:14] Well, that’s good. Everyone who’s listening should go over to our web site breakthrough REI podcast. That’s here and there. You can sign up for our information and our emails, and you will receive all of our updates and notifications when the shows come out. Events that we have on the go, all kinds of stuff. So get over there and sign up for our list as well as you can go and see all the information on the past guests that we’ve had there. You can click on their episodes and leave comments or get their info if you want to reach out and talk to some of our great guests, like the ones we have on today. You can find all their information in the show notes. Over at our website Breakthrough R.I podcast, that’s yeah. Well, sitting
Sandy Mackay [00:03:00] on, I can pick up our free report there, too, the ultimate strategy for building out the real estate. So we’ll get that for free and they’ll get updates on everything we’re doing and every episode as they come out. So it’s right that, yeah, we don’t want to forget about that.
Rob Break [00:03:15] That’s valuable stuff. They can learn a lot with that,
Sandy Mackay [00:03:18] understanding how they can and what else. I don’t know what else. We talk about anything new on iTunes going on.
Rob Break [00:03:25] Not yet.
Sandy Mackay [00:03:28] So again, you can
Rob Break [00:03:30] talk about that if you want to.
Sandy Mackay [00:03:31] Well, we got, of course, things to check us on iTunes. We reserve you always appreciate those. I think we have, I don’t know, hundreds of reviews at this point, and that’s really helped us attract some great guests, attracts some great listeners, and we would love to hear your feedback even after what are we five and a half years into this? With that, we’re still reading every single, every single reviewer that goes on there about the show, and we’d love to hear more.
Rob Break [00:04:00] Yeah, there hasn’t been any in a while, but right now we’ve got 240 ratings. Two hundred and fourteen five stars and the rest in the various other slots there. But there hasn’t been one since May. So everybody come on, get a get over there. Give us a review. Let us know what you think. So I think that’s it. Then I don’t want to talk too much. We’ve got ongoing projects; you’ve got ongoing projects are all going well and all there’s hiccups. But we get over them and we’ll talk to our guests about how they do the same.
Sandy Mackay [00:04:32] No hiccups come on and everything’s smooth. Well, I have something to say.
Rob Break [00:04:36] It’s easy because it’s all right. No hiccups on your end.
Sandy Mackay [00:04:42] Nothing more than the usual. Let’s say there’s always, always, always, always. Some things like that.
Rob Break [00:04:48] Let’s see what we got. Go ahead.
Sandy Mackay [00:04:50] That’s all we got. Ooh. You know, a lot of stuff ongoing.
Rob Break [00:04:58] Oh, we lost him.
Sandy Mackay [00:05:03] What is that?
Rob Break [00:05:07] Well, I don’t know, we lost you.
Sandy Mackay [00:05:08] Sorry, I got to
Sandy Mackay [00:05:12] Did you lose me there for a sec.
Rob Break [00:05:13] Yeah, we did, but didn’t hear anything about your hiccups.
Sandy Mackay [00:05:18] So hiccups. Yeah, ongoing. You know, city stuff, I guess, would be the biggest thing and having to, you know, want to do something with the city and tell you what they wanted this way? And then halfway through, they wanted a different way. And that’s always an ongoing battle. It’s fun. And some things do overcome learning over time, obviously, right? And you learn how to navigate that. I always find that’s challenging for newer people. Just. You know, it’s kind of left in of why, you know, why someone one person would tell you to do this way and then the next one tells, you know, we need it this way, but then we’ll do it the way the original guy said,
Rob Break [00:05:57] Yeah, the biggest thing is in that school in those situations, right there is because it does you absolutely no good whatsoever to lose it and say what you know, one person told me this now you’re telling me that you just got annoyed and do what the what the one the current one is telling you. And that’s tough. That’s a lesson right there.
Sandy Mackay [00:06:19] It’s tough. It’s one of those things where you learn how to get through it quicker as you go, and then it’s part of the, you know, you have to have a little hiccups here and there and some failures to make it all worthwhile. Otherwise, everyone would do it and it would be easy money.
Rob Break [00:06:32] Mm hmm. Thanks for sharing that, Sandy. Today, we are very happy to have Melanie and Dave Dupree on the show. Dupri, right?
Melanie Dupuis [00:06:41] Yes.
Dave Dupuis [00:06:41] Yes.
Rob Break [00:06:43] They’re going to share with us the way that they structured their deals, including how they pay zero down and actually receive checks when purchasing rental properties. So welcome, guys. Thanks for being here.
Melanie Dupuis [00:06:55] Thank you so much for having us.
Dave Dupuis [00:06:56] Yeah, thanks for having us, guys.
Sandy Mackay [00:06:58] And yeah, welcome and million Dave. Their experienced successful self-taught real estate investors take the multifamily by storm in beautiful North Bay, Ontario. And together they have found it if we properties and put their business plan into action. Their ultimate goal is to expand and grow the real estate portfolio to a point where their investments became prosperous enough for Melanie to leave her full-time employment, and she was actually able to do that before turning 40. So really exciting there, and they’re about to do today was when they impressively acquired 12 properties in less than 12 months, and now they own just under 100 doors. They published a book this year, which is already becoming number one bestselling book on Amazon, and the book is entitled Real Estate Investing Secrets a No Best Guide to Creating Wealth and Freedom, so I’m sure we’ll get into more. But all that through the show here and again, I’m really excited to have you guys here on the show.
Rob Break [00:07:53] Very impressive. Thanks, guys. Thanks for being here.
Dave Dupuis [00:07:55] Thanks for the intro.
Sandy Mackay [00:07:59] Okay. Well, when we when we tell people where North Bay is because I know we got listeners across the country that might not have heard of North Bay.
Dave Dupuis [00:08:06] Yeah, absolutely. So it’s everyone knows Toronto. So we’re about three, three and a half hours north of Toronto. They just built the beautiful four lane highway. So we’re just a hop skip and away from Toronto now,
Rob Break [00:08:17] no traffic jams.
Sandy Mackay [00:08:19] Yeah, exactly.
Rob Break [00:08:21] Was there traffic jams? Why did they build a four-lane highway? Sounds excessive.
Dave Dupuis [00:08:26] Yeah, just ease. It’s just trolley used to be a four hour plus trip. And now with the four lanes, it’s just beautiful ride. You can go to Toronto. No problem was the Jays game and go see the Leafs. We’ll see the Raptors. So anyway, I’m super happy about it.
Sandy Mackay [00:08:41] How many people live in North Bay? What’s the population there?
Dave Dupuis [00:08:44] 52 ish in the city itself. And then there’s surrounding, I think it’s like 60 or 70 with the surrounding area. Don’t quote me on that day anyway. I know, I know it’s basically done. That’s pretty much it.
Rob Break [00:08:56] OK, well, tell us a little bit about yourselves and how you got started in real estate investing.
Melanie Dupuis [00:09:01] Sure. So when Dave and I met, we both already had a passion for real estate. I had purchased two rental properties to duplexes. Dave had the one as well. And then we decided to continue to grow. So we made some short-term sacrifices. We sold the brand-new vehicle that I had just purchased. So that way the banks would love our numbers more and then we just started to really invest more, so we slowly grew from there. Our best year is when we purchased 12 in 12 months. Once we decided the secret of the magic of creative financing, great.
Rob Break [00:09:43] And we’re going to hear more about that. So. And what about your family? What about your social life, that kind of thing? What do you guys like to do?
Melanie Dupuis [00:09:50] Well, we love it. We love real estate. So a lot of a lot of what we do is real estate. We’re always listening to podcasts or are learning more about it. We have three kids, a busy family life as well with them, of course, with their sports and activities. We enjoy we have a pool to enjoy the pool in the sunshine.
Dave Dupuis [00:10:09] And now that it’s summer, you can enjoy. Yeah, exactly.
Rob Break [00:10:13] Well, that’s great. I just moved in. I lost my pool. So now my wife is saying maybe we should start pricing them again, but. Oh okay. Great, great. OK, so that’s like a little bit how you got started. So once you got together, then where did it go from there? Just, you know, on a break it down sort of scale before the year where you guys did the 12, you know, you met each other and then what was the plan from there?
Dave Dupuis [00:10:42] So like, like Mel was saying? We’ve always loved real estate, I remember reading a real estate book in high school and just thinking, you know, looking up and seeing people that had money and all that that seemed to always come down. You know, they always had real estate somehow. So we did the typical, you know, fireplace, get the rents up, refinance it, take that, buy another place, you know, borrow money from someone so that that kind of got us out. I think about eight, eight or so buildings. And then after that, five, five to eight, I forget now. But yeah, after that, it kind of we just hit a roadblock once again. And that’s what people kept talking. Will creatively financing and different, you know, buzzwords. And the turning point was kind of, you know, reading, rich dad, poor dad by Robert Kiyosaki and then the kind of the light switch literally turned on and oh, you know, I can use different avenues. So that was kind of the big turning point. And that’s where we became, you know, the 12 and 12.
Rob Break [00:11:42] OK, well, we’re pretty excited to hear about that. So what? So you guys find great properties. How do you what do you look for in a good building? Let’s start with that.
Melanie Dupuis [00:11:54] Sure. Well, I guess the first thing is that we look at a lot of built a building, so it’s certainly not, you know, just looking at a one or two. We’re always assessing buildings. We’re always crunching numbers. You need to make sure that you know that the numbers make sense was first of all, for us, it’s more about the numbers over what the building looks like. We are for sure, always multifamily. We have a few houses, but overall our strategy is multifamily residences. It just the number wise. It makes sense if you have a house and there’s a vacancy or vacant. If you have a 10 plex and there’s vacancy, you’re 90 percent full. So that makes sense to us for, yeah, for multifamily
Dave Dupuis [00:12:33] and just we always find like moles saying, like, we’re good. We look at deals all the time. We don’t put our eggs in one basket. So constantly looking at buildings and then getting to know the market, getting to know, you know, we always buy something that cash flows. I shouldn’t say always sorry. We buy buildings that cash flow from day one. Our bread and butter is really the underperforming one. So, you know, find the building. It’s already making money. Go in, clean it up, TLC, a little bit of cosmetic, different things like that. Get the rents up and then refinance it and you’ve got money to do it again. So that’s kind of our bread and butter. But yeah, when I say always, cash flow is sometimes you find those bank repos where they’re vacant, right? So obviously there is no cash flow from day one. But generally, yes, we want some of the cash flows from day one, and that’s underperforming. Mm-Hmm.
Rob Break [00:13:23] So you said you get the rents up. How? Take us through that, do you find a creative way to, you know, get them, get them to vacate so you can fix it up or what? But how do you do that?
Melanie Dupuis [00:13:36] It depends on the situation sometimes. Sometimes they do. They are already vacant because if it’s a bank report, for example, sometimes it’s just as I mean, as we know, of course, we can’t just kick out anyone and we fall over. We’re a big rule follower, so we make sure to always do that. But if, if or when somebody does move it, there’s potential. If the unit has old sagging green carpet and old paint, then absolutely we’ll send our crew in. We’ll give it a facelift. New flooring, new paint, new windows make it more attractive and then we’ll be able to, from there, get a better tenant likely and a better, higher rent as well.
Dave Dupuis [00:14:15] Yeah. And the other thing too is sometimes we buy buildings and not fire retrofit. So, you know, obviously we do that. We jump through all the legal hoops that we, you know, sometimes when people could be parents. So they’re coming down with their kids for school, the love that it’s legal with the city fire retrofit. Another way that we do it is we work with the tenants, right? So we we’ve got a big marketing sorry presence in north based. We market a lot of ads on the radio saying, you know, we want to buy your building ads on the radio, saying we’re pet friendly billboards for property management, billboards for all sorts of stuff. So the presence that we have marketing is very important so that that allows us to demand a higher rent because people know us and want to rent from us. The other thing too, is with the tenants, because we have lots of units, we can say, hey, you know, we buy building guys who seem like good tenants. Why don’t we move you somewhere else so that we can refurbish this unit and, you know, rehab it? So that’s something that’s worked. Sometimes it’s been, hey, hey, let’s make a deal all up. I’ll update your unit. But then, you know, rent has to be X amount of dollars after to justify the rentals. We’ve done it where, hey, what if we give you first and last back, you know? And then so it’s just honestly very creative we’ve done in different ways, but it’s always been legal. As long as we when we put our head on the pillow at night, we can rest assured that we did it legally. But there’s so many ways to kind of work with the tenants to make them part of the solution, right? And they love that.
Rob Break [00:15:45] OK, so what does the portfolio look like now, then?
Melanie Dupuis [00:15:49] So now we own just under 100 doors that we own ourselves. We also do property management. So we have we have about 10 buildings that we that we manage right now. And our goal is to continue to grow. So we’re all about indexing, so we want to 10x that. So we want to have 100 doors or a thousand doors of our own. And we want to manage 100 doors as well. And of course, we’re not doing it alone. We have we have a great crew that helps us achieve all these goals
Dave Dupuis [00:16:23] and the portfolios that we have. Our biggest building that we currently own is 17 units. And then we have single family dwelling. So kind of anything in between as well, you know, triplexes four, six eight. So it’s just kind of different. Yes, that’s what our portfolio, we own or manage another building that’s 22 units. So kind of single-family dwellings to multi multifamily. So yeah, kind of everything.
Sandy Mackay [00:16:50] And that all be that all in North Bay, then
Dave Dupuis [00:16:52] correct all in North Bay.
Sandy Mackay [00:16:54] Good.
Melanie Dupuis [00:16:55] And at least for now, we’re always open to different areas, but we have been focusing primarily on North Bay for now,
Dave Dupuis [00:17:02] for the time being. Yeah, yeah.
Sandy Mackay [00:17:04] And is it is it ever running and challenges of finding like it’s not a huge city necessarily, but there’s I guess there’s just enough to be able to accomplish your goals and out there for an hour? Or do you ever have any challenges finding inventory,
Dave Dupuis [00:17:17] like you said for now, finding inventory so far? No, we seem to be in that kind of that sweet spot where there’s a lot of people that are at the tail end of their, you know, real estate investing career. Their family doesn’t want to take it over. So they they’re looking at kind of liquidating. So we’ve seen a lot of that of, you know, mom pop landlords that just want to get out. The other thing too, is because our cap rates are still very competitive, like our cap rates are between eight and 11. Let’s say Toronto is just for something in the province.
Rob Break [00:17:51] Fantastic.
Dave Dupuis [00:17:52] I know. So Toronto is with most of we manager from Toronto people that, hey, I only can get a four-cap rate. Why don’t I bring my money to North Bay? And, you know, eight and 11 sounds, it’s very attractive to that, while sounds attractive to anyone, right?
Melanie Dupuis [00:18:05] But there and Dave kind of touched on this a bit earlier as well. We’ve been very, very aggressive with our marketing. We had radio ads saying, hey, we want to buy your property called the free properties. So we have people calling us every day wanting to sell our building, wanting us by their building. Yeah. So we’re always crunching numbers. We always have new leads, whether they are listed through an agent or privately. So we get the opportunity to look at a lot of deals, which of course, helps us find the ones that are the right one, the cash flowing one or the one with a lot of potential.
Dave Dupuis [00:18:37] It’s funny because we get first dibs and then sometimes you know, we’ll do the cash flow analysis, and it just doesn’t work for us. And a week later, you’ll see it on MLS. So it is okay. We turn that, you know, just kind of just a funny Little Perk,
Sandy Mackay [00:18:50] and that’s then that’s through your marketing, essentially, you’ve done. So it’s I guess that’s one of the perks of being in the size of a city like that would be very challenging to get on radio stations in Toronto or Brighton, right?
Melanie Dupuis [00:19:03] For sure. So here’s what you have to your advantage, right?
Sandy Mackay [00:19:06] Exactly. Anything else you look for in a in a building before you purchase it? Anything, anything of any must haves there that they haven’t got over?
Dave Dupuis [00:19:14] And yeah, like Melanie was sorry, the legal with the city. You know, the actual zoning, the usage. I know you can always do the change of usage and all that, and I know you were saying earlier that the city and hiccups and headaches, so we typically only do them if they’re zoned properly and the usage is there are the, so we don’t have to do change of use. So that’s kind of one of ours. Otherwise we negotiate into the price, or we make it, you know, make it fall back on the seller. But so that’s kind of a must. We call the city, hey, I’m looking at this building, what’s zoning, what’s the allowed use and then fire retrofit. So those are kind of our we have to know what it entails, either it’s done or, you know, we know that x y z needs to be done in order to get it once we once we take possession. So those in my head are kind of musts other than cash flow than that.
Melanie Dupuis [00:20:04] Yeah, it has to be a good building, has to be well structured. We’re not necessarily always looking at, you know, the sexy big twenty-one plex small brick that a lot of people go for. We look at sexy cash flow, but yet for the building that are still again legal with the city and has that nice, good structure where you’re not going to have to spend fifty thousand dollars. That you’ll never get back cutting into it. Yeah.
Sandy Mackay [00:20:30] How do you use debt then and other people’s money? You know, you talk about using that to acquire more great investment properties. What does that look like? How do you do that?
Dave Dupuis [00:20:39] So and that’s where the rich dad poor dad book by Kiyosaki was life changing. So basically, just transforming the thought process of debt is not bad. That is good. News views properly. That’s your best friend. So basically, it was just an opium against our debt and opium to me, either hand in hand, but using the bank’s money for everything. And it’s you know, well, a couple of years ago was basically free money, but it’s still it’s still pretty, pretty good. So just highly leveraging, highly using it and vendor take backs. So what’s been? Our kind of big thing is the vendor take backs. So again, you know that when we came into that roadblock of the way it five or eight buildings, the vendor tape backs, you know, having the seller assist with creative financing, that was the game changer so that using their money in order to help us with the down payments and financing, that’s where, you know, the night and day, right?
Melanie Dupuis [00:21:40] And I think having once again the business name behind it helps us sell. So why you know why he’s just somebody trust us with their money? We had already proven ourselves. We already had a lot of properties. We had a team helping us with renovations. So they saw that we had all that in place. And the second part is that we always ensured to have an exit strategy, which is where a lot of people, sometimes when they failed in real estate is because they don’t have an exit strategy. So having that in place? Hang on, ABCD is an absolutely must.
Dave Dupuis [00:22:15] Yeah. And in our book, I started just so I’m thinking about the OPM, just the bank, how amazing it is to have the bank on your side. There’s a section in our book I forget how we word it, but it says something like, wouldn’t you love to have a partner that fronts, you know, 75 to 80 percent of the of the money, the capital? They let you do what you want day to day. They let you keep the cash flow. When you refinance, they let you keep the, you know, the lift, the appreciation. And then when you sell, they let you keep the profit you made and it’s who is that partner to the bank. So just.
Melanie Dupuis [00:22:46] And then that partner is also silent. So it’s
Sandy Mackay [00:22:49] better. There’s no opinion, no opinion.
Melanie Dupuis [00:22:51] There’s no fighting or arguing.
Dave Dupuis [00:22:52] So that’s that is major.
Rob Break [00:22:54] Now I’m going to dig a little bit deeper into the owner financing portion here that you guys were talking about. Do you have a go to structure? If you’re going to say, OK, you know someone’s willing to look at a vendor, take back, let’s put something on paper, you must have a go to structure that you would present to them initially. Is that too complicated the layout for everybody, or no? No.
Dave Dupuis [00:23:19] And there’s been a lot of different scenarios, but
Melanie Dupuis [00:23:22] I was going to say, we do it. We don’t. I mean, a lot of it is listening to who we’re dealing with is trying to find out what’s important to you. So some people want their money back in a year. Some people will say, hey, I don’t want to get my money back for five years because of capital gains. Some people rather have higher interest rates and people rather get a monthly payment. So what’s our formula for that? It’s really to communicate with the with the silent partner and find out what’s important to them. And we kind of customize, yeah, based on their needs.
Dave Dupuis [00:23:56] And so some of the standard stuff that we ask for is we’ll do twenty-five-year amortization just because if you do shorter, just again, it keeps your payment lower rate. And most of them are OK with that. We’ll negotiate if they want principal and interest or interest only, which I’d rather, you know, interest only, but again, just because it keeps the monthly payment low. The other thing is the interest rate has to be something where you can still cash flow, and it’s really explaining to them like guys, you know, because we’ve gone three, five, six, you know, things like that. So we’ve gone from a three percent for five years, which again, is pretty much free money, right? Like it’s beautiful. What was I going to say? The other thing is, you know, some people ask for 10, 12 percent and you say, OK, well, you realize if I buy your building and you for charging too high on the interest, you’re kind of strangle holding the cash flow, which again jeopardizes the exit strategy, right? So it’s really working with the seller. You know, it’s
Melanie Dupuis [00:24:57] it’s we also asked that with the flexibility of being able to repay them at any time because quite often, although we have a five-year contract, we can when we’re able to pay them. So again, we work with a client. So if we have a client that say, hey, now we don’t want our money back for five years as much as possible, then we won’t repay them necessarily. But we want to be able to repay as we go off course. So we have a lot of clients that already done this and there is still. Four years remaining and we said, hey, we have the cash to pay you back. Are you fine with that? They said Absolutely. So boom, pay them back. So having that as a clause as well as part of your arrangements with them, I would highly recommend because that gives you that flexibility.
Rob Break [00:25:41] Yeah, go ahead. No, I’m just no more. Go ahead. Yeah, yeah, I know.
Dave Dupuis [00:25:46] And one of the selling points guys like Mel was saying the capital, and we’re not lawyers or accountants, so don’t take us. But one of the selling points is, you know, if you sell a building in its entirety today, you’re getting hit with capital gains in this year, right? Whereas if you help us with creative financing, you know you’ll get hit with 80 percent of it. And then if you want to spread the other 20 percent that you’re helping us with, now you can spread it over. I think it’s five years maximum. So it’s a win rate like the seller does it for a reason as well. So they’re not just, you know, doing it from the bottom of their heart, they’re also one offs. I’m sure some of them do, but they get to spread that capital again and spread the love.
Melanie Dupuis [00:26:21] So you need to know if you’re if you’re starting off, if you want to go that route and you don’t know how it works, it. You need to make sure be educated on it. You know, read about it, do your research so you can speak smartly about it, be able to explain it and see being able to more or less sales pitch because they are buying into what’s in it for. Why should somebody do that other than just have a sell their house? So there are benefits and you need to make sure to communicate that with the seller.
Rob Break [00:26:48] Mm-Hmm. I think this is one of those unknown things where people do what they want to know, and it’s the same as a joint venture partnership, in my opinion, in that you’re trying to help out the other person, you’re seeing what they need and what you can offer and then coming up with a structure that works for everybody. It’s not necessarily this is this is how I do it. And if you don’t agree with that, then we’ll move on because that’s yeah, that never works. It never works out that way.
Melanie Dupuis [00:27:16] Exactly 100 percent. And the nice thing about that as well is that once you do that, a lot of real estate agents or a lot of real estate investors have a lot more than one property. Guess who they’re going to call for the next time they have a place to sell if you made it a win situation.
Sandy Mackay [00:27:32] Yeah, yeah, it’s awesome. That gives us some insight. And a lot of people we even have, a lot of people aren’t actually talking about no take backs. That’s cool that they can make that work go. Yeah. All of your deals, how or what are some of your goals going forward now than with all you’ve achieved there? You mentioned 10x thing, is that a green card on that or both?
Melanie Dupuis [00:27:54] Yeah. So that’s certainly where we heard it from the 10X, and that’s how we set our goals. So we actually kind of backtrack. When I was younger and I was working full time, I had set a goal that I wanted. My first initial goal was that I wanted 10 properties by the time I was 40, and at that time it seemed like a pipe dream, and it didn’t seem flexible or didn’t seem feasible at all. And before I was 40, I think we had 20 21 properties, 20 properties. So it was kind of a reality check for myself that I way underestimated my own capabilities. So once we started to listen to record on with a 10X, as you know, set your goals 10 times bigger, even if we don’t get there, it’s still going to be way closer to what it was actually than underestimating myself, as I kind of did so. So, yeah, so now our goal is 10x. So we want to have that thousand doors that we own, and we gave ourselves five years, five years. Yeah, so we’re crushing every day.
Dave Dupuis [00:28:59] And then the property management, the property management, we have just under 10. So we want to manage 100 properties, so, you know, 10 times out as well.
Rob Break [00:29:07] So that is fantastic. I love those goals. There are huge goals, huge goals. I hope you guys make it up. You guys make it there. Let’s talk about negotiating tips. And I know that wasn’t like the way that you structure things as a win. Obviously, when you’re dealing with a private seller is one thing. But then what about negotiating tips if you’re going to buy something, let’s say, on market or whatever?
Melanie Dupuis [00:29:33] Yeah, yeah, great question. The same kind of rule applies you. The last thing anybody wants is to get a slap in the face. And I mean, we’ve done it to others, and we had it done to us. And any time you either put out an offer that is, you know, really a slap in the face somebody else because it’s your you’re going sixty thousand under the asking price and not necessarily what it’s listed up or what, you know, its actual value out, it’s going to be harder to negotiate with them because they already have their guard up. I know that’s how we felt when we knew what a building or a house was worth and York, we were able to compromise. And yeah, everybody likes the deal. But when you went to slap in the face, it’s difficult to move forward from there.
Dave Dupuis [00:30:17] Yeah, and the most deals are here. And when we get the private deals, it’s beautiful. We get to direct with the seller and, you know, show them where, where our mindset and what our thinking is and. Now, when we go through MLS, so we we’ve been lucky, we’ve got an awesome realtor here in North Bay and best, very investor focused, he gets it, he gets the cap rates, he gets the numbers, he gets cash flow. He knows really doing the biz. So he’ll only, you know, he’ll only send his deals where he knows, hey, David Mitchell, want creative financing, so the numbers don’t need to jive with that in mind. Now that being said, he let’s say we’re putting an offer in. He now is so comfortable with our pattern and our structures. He now coaches. Sorry, I shouldn’t say coach, but now he talks to the other. Yeah, educates the other agent as to what we’re doing, why we’re doing it, how we’re doing it. And it’s worked in the past and what the seller should do it. And he’s even gone as far as to requesting to present the deal to the actual seller themselves. So he’ll sit down at the table. Have the seller had their agent present? This is why Mel and Dave are doing this. Here’s the castle analysis. That’s why they’re offering this. So it’s really breaking it down instead of having he said, she said and playing the telephone game, our agent is basically an extension of us and thank God that he helps us and really. Gets the message across as to who, what, when, where, why. So it’s not just a Hey, you’re offering me lower way, you know, and that’s so that’s been huge.
Melanie Dupuis [00:31:42] And much like the TBS, when we try to find out about what they want out of the deal, when we’re trying to buy, even if it is through MLS, is this everybody has a reason. So of course, price is one part of it. But some people just want they’re moving out of the country in a format they want to close in three weeks from now. So what’s important to them? What, why are they selling? So we try to ask a lot of questions. We worked with our agents to find out. We always ask, why are they selling? What is it? Is that they want out, that they are they in a rush? Are they not in a rush? What’s important to them? Do they have a bad tenure that they’re sick of dealing with? So again, so there’s lots of different things and lots of creative ways that we play around, and we can make it happen again. That’s a win for the seller and the buyer.
Rob Break [00:32:31] So do you talk about all of this stuff in your book then? Do you share your negotiations? All of the VTB stuff, all of that stuff? Is that all in your book?
Dave Dupuis [00:32:40] Not all of it. Because to be honest with you, we made the book an 88 page. We wanted a short, easy to read and got it right here.
Melanie Dupuis [00:32:48] So it’s short. It’s all very
Dave Dupuis [00:32:49] thick. It’s just a very quick. It’s kind of you’re starting out or you’re investing and it’s here. Use our info to leapfrog where you, you know, don’t waste the time you leapfrog. And so VTB, we don’t even touch on because in 88 pages, we had to wait to cut a lot. We had pretty much a 300-page book and then we had to really chop it down to. So we don’t even talk about VTB in there, to be honest with you, I think you’re the first person we talked to you.
Melanie Dupuis [00:33:10] Would you know the real secrets? OK?
Rob Break [00:33:15] Yes, I love it. So what are people going to learn about in the book that
Dave Dupuis [00:33:19] basically it’s what any real estate? It’s more of a foundation, you know, when it’s kind of ends and our quick and dirty what every real estate investor. Like, I basically wrote the book, I wish I had that book when I was starting out. It would receive me mistakes, but it saved me some time and probably some money.
Melanie Dupuis [00:33:36] Exactly. So we do talk about finding the cash flow or cash cows we call them. How do we find them? How do we go about it? We talk about Win-Win negotiations and what that looks like. We talk about building a team. We talk about marketing tenants, tenant goal setting, so we do have it. So it’s kind of an over overlook of everything that’s important. Basically, you can read the book in less than four hours. You read the book, you’re ready to start. And then from there, you’re able to continue to educate yourself because of course, one book is never enough that there’s so much. I mean, we have the years’ experience. You have to do it. We work with mentors as well, which is something we always recommend and talked about that in our book as well. For us, that’s another step too. So you could take a full chapter and write a whole other book based on each single chapter because there is so much information.
Dave Dupuis [00:34:24] So yeah, we wanted the first one to be just easy to read, just because we’re not big readers. I like listening to audio and podcasts and videos, so I just I want to write the book for someone is kind of like us, you know, pick it up. And then once you put it down, you’ve read the whole the entire thing.
Melanie Dupuis [00:34:37] It’s done well as well. Last week, I was pretty excited because it was, I was on Amazon and looking at it, and it had already hit number one on Amazon. And I saw thinking grow rich by Napoleon Hill being number three. And I put it up a couple advertising or a couple messages on Facebook and Instagram. I said, hey, you help us get to number one and we did, which was awesome because I was, we were number one and Napoleon Hill was bumped into number seven for that child.
Dave Dupuis [00:35:05] So it will be forever. But it’s kind of those little things I took.
Melanie Dupuis [00:35:09] I made sure to take a screenshot of that one.
Rob Break [00:35:11] Yeah, that’s a good way to take a screenshot of what’s the book called The Good
Melanie Dupuis [00:35:15] Real Estate Investing Secrets and Obese Guide to Creating Wealth and Freedom?
Rob Break [00:35:20] Great. OK, so everyone go to Amazon and buy that
Sandy Mackay [00:35:23] awesome, awesome thing of keeping number one. Napoleon Hill is a tough one to write for forever.
Melanie Dupuis [00:35:29] So yeah, absolutely. It’s a great book.
Sandy Mackay [00:35:32] Yeah, yeah, that’s what are what. Let’s talk a little bit about the management side of it, the property management. What are what are some common myths or yeah, about being a landlord and managing properties?
Dave Dupuis [00:35:44] Them everyone, just like we hear so many times, everyone, and it’s always both the plunging toilets. Everyone’s obsessed about plunging toilets. Yes. And honestly, it’s not that big of a, you know, the plunging toilets isn’t a big piece of it. The two a.m. toilet backups are few and far between, but those are most of the fears. The other thing is bad tenants nonpayment of rent, which again does happen. However, kind of like we say in the book, which should definitely not be a roadblock, just have processes in place and just, you know, it’s like your car. When your car is empty, you fill it up. Or if you have a flat tire, just deal with, I guess that’s basically in our book, just deal with it.
Rob Break [00:36:24] So those are I can see; I can see it being very similar to what you just said. So someone that might say, well, I don’t know everything about real estate investing. Why? Why the heck am I going to go and. Buy a house and have to deal with all these issues. It’s the same thing with the car. Ask how many people know how to fix their car if it breaks, like you said, even change a tire. They’re not doing it themselves. They’re going to call someone on the side of the road, and they’re going to come and get it fixed. And then two or three days later, they’re going to forget all about it. Exactly. So yeah, that’s a good that’s a good simile there.
Melanie Dupuis [00:36:59] Yeah. And the more you grow. Ironically, it almost gets easier because when we first started, we had to be more hands on, of course, because we didn’t have the cash flow coming in. So now, like, I clean the toilets and we did the dump runs and all that kind of stuff. But then as we grew with the cash flow coming in, then we could afford to outsource more. So now we have a property manager that does a viewing for us. We have a team that fixes the toilets where we don’t have to worry about that kind of that kind of stuff. So we confront control exactly different problems. But again, we’re focusing on what we love. There’s they can focus on what they enjoy doing, which is the repairs and maintenance. So there’s room for that growth where you can really be hands off, where it’s where we are finally now. That was one of our goals was to be more hands off with the actual General Day to day maintenance. So we still look at it. We still pay attention for sure, but we’re not the ones fixing or are cleaning or doing the dump runs when we do have a bad tenant. Mm-Hmm.
Sandy Mackay [00:38:01] I mean, depending on where some of that too, that can be that can be from day one. They could hire a property management service from day one and never have to think about it.
Melanie Dupuis [00:38:08] Yeah, yeah. And actually, and that’s a great point. We have a lot of people that purchased their first property and they hired us. We, we, and our team, we manage it. And there, you know, some of them are in Saskatchewan, some of them in urban and couvre. Some of them are in Toronto and there are a hundred hands off. So they
Dave Dupuis [00:38:24] just truly passive,
Melanie Dupuis [00:38:25] right? Exactly. So they collect their paycheck and away they go.
Rob Break [00:38:29] Yeah. And I mean, like, look at it this way, it would be very, very difficult for you guys to plunge a thousand toilets. You guys reach our goal right there.
Melanie Dupuis [00:38:39] Yes. Exactly. Yes. Not if it’s when.
Rob Break [00:38:43] Yeah, that’s right. No. When sorry, I was a slip of the tongue. You’ll have to
Melanie Dupuis [00:38:49] get your hot seat back before and after clipping a couple in five years from now of when we said we set our goals and when we achieved that so
Rob Break [00:38:56] well, hopefully this podcast will help you guys grow a little bit more to you. And I mean, I’m liking what I’m hearing because honestly, there is no such thing as a 10 coup in this area. Just that’s like, that’s how like basically you’re looking at maybe half if you’re lucky. Yeah. You know, so. So just hearing numbers like that is very, very appealing to me as well. I’m sure as everyone else listening.
Sandy Mackay [00:39:22] Well, what’s what, what? What are another couple? We’ll give you a quick spot here on North Bay. What’s the why would someone invest there aside from the awesome cap rates for everyone? Cap rates are great, right? But then everyone’s question as well what’s that with the growth and what’s happening there that is going to and we’re going to get any appreciation on that, right?
Dave Dupuis [00:39:41] Absolutely. Great question. So, yeah, North Bay, like I said it, we’re just a hop skip in away from Toronto. So that’s attractive to a lot of people. There’s two big lakes here. It’s more it’s mostly a government town, the schools, there’s a college university that brings in a lot of tenants. The vacancy rate is very low. I think it’s three percent, let’s say, two to three percent for our properties and our managed properties. It’s basically zero percent vacancy. So people are begging like we’re what, you know, midway through the month and people are still Dave. I need a place yesterday. So it’s just the vacancy rates are rock bottom. The cap rates are sky high. There, you know, they’re not building more buildings. So it’s a very supply and demand, you know, on the good end for landlords. So this is a very attractive market and it’s a good place to live. And yeah, I guess on what is
Sandy Mackay [00:40:37] and is there much of a vacant vacation property market there with the with the lakes? And I think that
Dave Dupuis [00:40:42] there is something and that’s something we’re kind of there’s one deal. We’re looking at its previous three or four on office property, but yeah, a little cottages for like a summer lake or, you know, a vacation. But there is there is a strong presence of that as well. Like, people love the lakes, right? So and there’s two of them, you know, you’re five minutes from lake to lake. So it’s kind of a unique what do they call it, the gateway of the North. You know, you can. Anyway, it
Melanie Dupuis [00:41:06] it’s a nice community. People love it as well because it is small, big enough that you may not know everyone, but small enough that you kind of know everyone or you’ve heard the names of everyone helps out each other. You know, when something if you hear of somebody in town having any kind of difficulty, you’ll just hear everyone. You’ll just see a bunch of strangers getting together and helping out. So that’s and nice.
Dave Dupuis [00:41:31] The one thing I just heard a couple of weeks or a couple of months ago, and it’s funny because. We are just they just opened a Starbucks here, and it’s the first Starbucks. And someone had said, stop doing all of the math or stop doing all the research. Just look where they’re building Starbucks because they have teams and teams and teams that do market analysis and all that. So it’s funny because Starbucks just opened about a month or two ago. So obviously, if it’s good enough for Starbucks, you know, so it’s just that I kind of laughed when I saw it open up. There you go. I guess the market’s doing well.
Sandy Mackay [00:42:03] And Starbucks, you know?
Dave Dupuis [00:42:07] Oh, yeah, you’re like the Starbucks everywhere, but does. Yeah, we’ve got one now. Awesome.
Rob Break [00:42:12] What do you think is the biggest thing that would hold somebody back from real estate investing?
Melanie Dupuis [00:42:20] Yeah. Excuses, yeah, excuses is for sure, the biggest ones are excuses, we always said excuses are lies. You tell yourself, we can always find a million excuses, why not to get started? You know, I don’t want to plunge Charlotte or what of the interest rates go up or I don’t have time and we have three kids. And, you know, we’re both working at the time when we started full time and we made it happen. So finding identifying your excuses and then finding a way around it, so I don’t have enough time while how can you create time? Maybe you get up two hours early in the morning when the kids are sleeping, so it doesn’t affect them, and you crush business for two hours and you crunch the numbers. So I think for sure, that’s probably the biggest reason or I don’t have money. OK? Well, it always comes back to excuses. I don’t have money. We didn’t have money either. When we started, you know, I was living in one of my rentals. I guess we just weren’t financially set at all. So we made sacrifices. We found out there’s sources of income. We sold items that make my vehicle that was more expensive at the time to again to make it more attractive to the bank. So they had no reasons to say no to us.
Dave Dupuis [00:43:29] Yeah. And honestly, my biggest thing, like when I met Mel, it was fear. Like, how am I going to deal with tenants? How am I going to just having that, that red light mentality? And then once kind of Mel showed me the ropes and I remember her saying, people do this all day, every day, all over the world. So it’s like it’s not rocket science, right? And then just that philosophy of, you know, I’m stealing from someone else again here, but just not waiting for all the lights to be green. You know, take the first green light and then you’re going to hit a red light, but you know, you’ll eventually get there. You just got to kind of go with the motion. So to me, fear was a big one. And once I realized, you know, get over it, that’s pretty much an excuse I was giving myself. But yeah, fear and excuses, that’s poison.
Rob Break [00:44:11] Mm-Hmm. And I think that the fear will cause the excuses, right? Like this one sort of feeds the other ends. And at least in my opinion, the fear never really completely goes away. I don’t like you in spite of the fear, right? Yeah, I agree. So that’s another thing that people need to realize, I guess, is it
Melanie Dupuis [00:44:38] always makes you a little bit uncomfortable once you’re uncomfortable and you may not know exactly how I can. I always figured out that needs are growing and that means you’re doing something right. Otherwise, if everything’s comfortable and there is no risk for fear and then you’re staying where you are, which is fine if that’s what you want.
Dave Dupuis [00:44:55] No good call. The fear is always there, but it’s not something you know yet. It’s different. Different fear. Yeah, learning to manage it.
Sandy Mackay [00:45:03] I’m interested in I’m interested in this on. You’ve got a unique way that you close deals and banks lawyers. Everyone says, How the heck are you doing this? Let’s hear what this one’s all about. Sounds like.
Dave Dupuis [00:45:16] So it’s a bunch of different little things. So deposits, we have a hard time with deposits. I, you know, you’re interested in the building. You put a deposit down and then, you know, whether you get the building or not and then you get the deposit back. So we’ve always said because we always have like right now, we closed one, we have three at the bank, we have another three or four and like we always have a bunch of deals on the go. So if I have to put down $10000 or five thousand dollars on every accepted offer I have, it’s tying capital for nothing, right? And if I walk away from the deal, it’s that’s my philosophy with deposits. I just don’t see. I’m a serious investor if I want your building and it makes sense, I’m going to buy it whether I have a $1 or $1 million deposit. So that’s been our thing, where now we go in on deals with $1 deposits and people know, no, you can’t do that. Well, why not? And we started doing it. We’ve had $1 deals and the lawyers, when they look like that, what? That’s not possible had you and real estate agents and. But again, it’s having our realtor explain. So just the one-dollar deal, people that blows their mind. So that’s one of them. And that’s kind of our philosophy behind it. The other one is incorporating things into the deal. So, you know, on closing, making sure that you get sometimes the sometimes the like, when we have those vendor take back deals, we get last month’s rent. So basically think of think of a building. He basically went and zero down, even negotiated, maybe them covering some legal expenses or the land transfer. So basically, you’re literally going in zero down and then last month’s rent comes back to the buyer. So the lawyers literally cutting you a check for last month’s rent. So that’s again, the lawyers like, how are you getting money when you buy a building fund close up on closing? So just things like that, guys just asking, knowing the seller needed quick and they wanted to make sure maybe they wanted their asking price, or they wanted it in January of next year for capital gains reasons. OK, so let’s negotiate. Maybe you cover illegals or just things like that. So., we close and get checks on closing.
Melanie Dupuis [00:47:22] Yeah, and I think part of it is that we were stubborn in our dedication to doing this. We didn’t take no as an answer when we said, well, it can’t be done, and nobody will ever accept that. We thought, Well. Prove me wrong. So be we moved forward, and we explained our reasoning behind it. So of course, explaining why we don’t want to put five thousand or ten thousand dollars down. I think, of course, again, it always goes back to reputation. People know that we’re serious buyers, so they know that the prices are going to put down, you know, they’re putting down an offer. They’re serious. So yes, we’re able to do that. And it’s fantastic because then we get a fifteen thousand dollar check back and we can put it right back in that building so we will close one place. And the day we took the keys, the crew went over, they cleaned up the yard. They made it look much better, much more attractive. The residents of North Bay, you know, we get soft on the street all the time saying, thank you for doing that. Thanks for cleaning up the results. It’s a win instead of again, that fifteen thousand dollars of deposit would have just been
Dave Dupuis [00:48:24] money gone, right? And it’s not like we’re taking that, that you know that closing money and going to Vegas. What’s going back in the building anyway is just, you know, it’s on a mortgage instead, which we all know anyway. So that’s kind of our philosophy. And I get down payments and deposits and everything and I understand the philosophy behind it, but it’s just this is what works for us and knock-on wood. It’s hopefully keeps working.
Rob Break [00:48:45] Oh, that’s fantastic. I love hearing stories like that, too, you know. So I mean, you guys have a really big goal here now that’s to get a thousand doors in the net well, to have an accumulation of a thousand doors in the next five years. So let us in on a little bit of your system for getting there. Like what’s next for you guys? Is this new partnerships? What? What’s the plan?
Melanie Dupuis [00:49:14] Absolutely. And today we spoke a lot about This, something we haven’t spoken about that we do as well is working with private lenders. So if somebody wants to invest privately with us, make money on their return. So we buy a property and we again, we speak with them. We make it a win situation. They make money on their money. We pay them back in the year or five years or whatever how long they want to do that. Yeah, we do it sometimes where somebody has our fees and they’re making minimal return on their investment, they can invest it with us and hold even a second mortgage on our ISP’s. You have to. So we have a way that we can take their fees. They can hold mortgage. They have a sense of a bit more security. And again, make more money than they ever would in their airspace. So, so those kind of things for sure helps. And then with the we’ve been asked more and more. We’re being asked for to do presentations were being asked to do podcasts. So we’re getting out exactly public speaking. So that’s kind of the next route where we’re working with somebody who has tremendous amount of skills with that to help us. It’s not our specialty, but to help us get to the next level with that as well.
Dave Dupuis [00:50:25] Yeah. And just the OPM, just touch on Mel. So we’ll have other investors that will say, Hey, David M. You know, so it doesn’t always have to be the owner doesn’t always have to be a vendor, take back, you know, someone has 50 80 100k and they say, I want to invest with you. So we’ll take that. We’ll use that as a down payment, legal and transfer, you know, some renovations. So basically, again, the zero down deal we’ve used OPM and then we do what we do flip to self, get the rents up, get the appraisal up, refinance the building, pay the investor back. They’re happy, we’re happy. We have another cash flowing building and then rinse and repeat and same thing with the RSP. So we just found a way now where people can actually take the risk fees and it stays secured with us through different types of mortgages in that. And then instead of getting there, you know, whatever, I don’t know, my recipes aren’t doing well. So whatever percentage are getting in that they’re going to get more with us and they’re taking their secured the secured funds and doing different real estate deals with us. So it’s pretty neat. But that’s another game changer, right? Is people’s RSP money that’s in there, you know, they can now buy real estate with it basically through us. So yeah, that’s how we’re going to try and get to the thousand doors. And just, yeah, we’ve got big deals. Like right now we’ve got one deal under contract that’s just under 40 doors and the other one is twelve. So right there, there’s what, sixty-two doors? More so hey, we’re chugging along, chugging along and keep on.
Melanie Dupuis [00:51:56] And yeah, that’s the thing we never just have you ever, never, ever have just one deal in the works. So we always have multiple deals because the reality is they’re not all going to come to fruition. So we’re always putting numbers. We’re always looking at building. We have always had a few other banks because sometimes it’s not. It’s not about us. The bank might not approve the actual building for whatever reason. Yeah, so we always have a lot of deals and work. So out of the ten that we and. We are working on whether two or 10 of them come to fruition, then we’re laughing, and by the time those one happens, we’re going to have another 10 15 on the works. So that’s kind of how we are going to get to that thousand is to always be working on it and never putting our eggs in one basket. Yeah.
Rob Break [00:52:40] Well, that’s awesome. Yeah, that’s awesome. Nice. Sandy, any more questions for these guys,
Sandy Mackay [00:52:45] something you all know, I think I think that’s just us, as always. I think that’s exciting. How are you going to get there? I think I think that’s a really great point at the end, having multiple deals, multiple opportunities at once because yeah, I experience the same. Not everything is going to work out. And if you’re all eggs in one basket, then you’re stuck starting from scratch. Get and the next one comes up. So great point there at the end. And obviously you’re going to do some big things over the next the next few years and hit all your goals. And if someone wants to get in touch with you, then to be involved in on these win situations, invest with you or whatever that looks like. How can they get in touch with you?
Melanie Dupuis [00:53:24] Yes, we have we have a website, Dupree Properties dot com. It’s Dupuis Properties dot com. We’re also an Instagram investor. Couple underscore Mel on this card, Dave, Facebook as well. Invest through a couple underscore and underscore Dave. So yeah, reach out. Call us. We love talking real estate. So any time, whether it’s for investing or you want to know more about North there, there you have some money that you want to put to work, then call us and we’ll
Dave Dupuis [00:53:51] we’ll chat and also just email. Welcome home at Dupuis Properties dot com and the properties, as I say, that some people get caught up on that, but anyway, give us to reach out to us.
Rob Break [00:54:02] OK, hey guys, send us all of those links and we’ll be sure to put them in the show notes for you. And that way people can connect with you whatever way that they want to know. That’s awesome. That’s fantastic. And thanks again, guys, for sharing all this has been a lot of stuff here, so I especially enjoyed hearing about the vendor take back stuff. That’s cool. I think a lot of people are interested in. So that was great. Really appreciate everything you will be speaking with.
Dave Dupuis [00:54:28] Yeah. Thanks, Rob. Thanks, Andy. Appreciate it. Back at you guys.
Rob Break [00:54:31] OK, Cindy, how can people get in touch with you?
Sandy Mackay [00:54:35] Two eight nine three eight nine six eight four six or info at Mackay Realty Network AECOM.
Rob Break [00:54:41] And you can reach me at two eight nine nine two seven zero four six four if anyone’s looking for student rentals in the Peterborough area or duplexes in Durham region. Give me a call and that’s it, guys. Thanks a lot for listening and we’ll see you next time.
Melanie Dupuis [00:54:57] Awesome. Thank you.
Rob Break [00:54:59] Bye bye. Bye. Now.