Rookie Podcast 19: Going Full-Time as a Rookie Right Out of College With Arvi Carkanji and Dave Arlaud

Rookie Podcast 19: Going Full-Time as a Rookie Right Out of College With Arvi Carkanji and Dave Arlaud

49 min read
Real Estate Rookie Podcast Read More

Join for free and get unlimited access, free digital downloads, and tools to analyze real estate.

In today’s episode, you’ll meet a power couple who both immigrated to the U.S. seven years ago and soon decided real estate would be their path to financial freedom.

Arvi Carkanji and Dave Arlaud are Nashville-based flipper-investors, who are dividing and conquering to run a successful business while building a stable of rental properties. Arvi handles acquisitions (listen for the Rookie Request Line about direct mail), while Dave is a licensed contractor who takes charge of construction.

Together they walk us through their approach to renovating houses and working with subcontractors and dive into the deal that motivated Arvi to quit her first (and quite possibly last) “real job.”

If you’re thinking about taking on “value-add” projects—and you probably should be—listen close to hear these two rookies walk us through their process!

Click here to listen on Apple Podcasts.

Listen to the Podcast Here

Read the Transcript Here

Ashley:
This is Real Estate Rookie Show number 19.

Dave:
So trying to do stuff yourself in the beginning phase is really key, and the other key I say is have close friends and family that are maybe into the construction world that can possibly come help you out in the beginning, give you some tips on how to start, and make sure you’re on the right path.

Ashley:
I am Ashley Kehr, and once again, Felipe Mejia is called out on his flexing.

Felipe:
It’s so funny-

Ashley:
Another great episode.

Felipe:
Because we tried to close out the episode, and Dave is like, “Whoa, whoa, whoa. Before we end, Felipe, I heard that you have little itty bitty tiny biceps. I’ve got to see this.” And I was like, why did Ashley start this trend?

Ashley:
No, no, that was Ryan, that was Ryan.

Felipe:
Oh Ryan, it was.

Ashley:
That’s the other one. If you guys haven’t listened to that episode, go back to look for Ryan Dossey. We did two of them, and I believe it was the first episode we did with him I think where he called you out on your bicep flexing.

Felipe:
We’re not talking about Felipe’s biceps. Today, we’re actually going to be talking to Arvi and Dave. So this is a couple that’s now in Nashville, and they are crushing it for sure in real estate investing. And what really warmed my heart is they actually immigrated to this country seven years ago, and they’re crushing it in real estate. I love that. I love to see the underdog just crushing it and killing it, so super proud about that. They talk a little bit about that at the very end of the show, of kind of the obstacles that they’ve had to overcome.

Ashley:
And Arvi, she actually started as the real estate investor. She found bigger pockets, got into it, and bought her first flip. And she started doing it by herself and then kind of pulled Dave in, who already had construction experience. And Arvi actually quit her … She had a part time job after college, and she ended up quitting it four months into flipping. So I mean, just that right there is amazing that she had that confidence and she was doing well that she is doing this full time. And that was just a year ago that she started, that she got her first flip under contract.

Felipe:
Yeah, they’re crushing it. They really are. I really like today’s voicemail question. You know what? I’m not going to spell it out, but just make sure that you listen to today’s voicemail question. It’s really, really good and really informative the way they answered. And if you guys do have any questions, you’re always welcome to call in and leave us a voicemail at 1-888-5-ROOKIE, and we might use yours on the show.

Ashley:
Yeah, and don’t forget to check out the show notes too at biggerpockets.com/rookie19. We asked Arvi and Dave to give us some photos too of their before and after, the flips that they’ve done. And it’s really funny, they started in Buffalo, which is where I’m from, and now they live in Nashville where you’re from. So that is just a really funny coincidence.

Felipe:
I’ve gone ahead and challenged him to a basketball off, because I think he played ball in college, but people don’t know that I’m, like, 5’8″, so when I show up ready to hoop him up, he’s going to laugh at me.

Ashley:
Welcome, Arvi and Dave. Thank you so much for joining us today. Let’s hear a little bit about you guys, how you met, and how you got into real estate.

Arvi:
Yeah, absolutely. First of all, thank you for having us. It’s a pleasure being here. I’m actually originally from Albania. It’s a very small country in Europe. I moved here when I was 17, and I lived in Buffalo up to January when we moved to Nashville.

Ashley:
Do you have snow in Albania, or was the snow new to you?

Arvi:
No.

Ashley:
Yeah.

Arvi:
No, yeah, definitely new, and especially not like that. I mean, I’d seen snow before, but Buffalo’s just a different story.

Ashley:
Right, yeah. And what about you, Dave?

Dave:
Yeah, so I was born and raised in a small country as well, but not Albania. It’s Suriname in South America. Born and raised there, moved here when I was 15 playing basketball on a basketball scholarship. And I moved to Buffalo, New York, that’s where we met, my sophomore year in college.

Felipe:
Very nice.

Ashley:
So a big change for you in weather too.

Dave:
A big change. I’d never seen snow before.

Felipe:
So South America. Do both of you speak Spanish?

Arvi:
I do, not because I was born and raised there. I just lived in Spain for a couple of years, so that’s how I know, but Dave-

Dave:
I speak Dutch, because yeah, that’s my native language, Dutch.

Felipe:
Oh man, that’s awesome. That’s awesome. So your kids will be, like, trilingual.

Dave:
They’ll be confused. They’ll be very confused.

Felipe:
I love that, I love that. [Spanish 00:04:16].

Arvi:
[Spanish 00:04:16].

Felipe:
[Spanish 00:04:16]. That’s awesome. That’s awesome, guys. So guys, tell us a little bit about your real estate journey, what got you into real estate, why you started, what are you doing now, and how far back that goes, and give us a little bit how your background also plays into that?

Dave:
Okay.

Arvi:
Yeah, so I actually, it doesn’t go that far back. We were in college, just graduated. I was looking for jobs to try and see what I wanted to do. I studied business. I always thought of myself in the corporate world. And Dave here was in basketball, so completely different. But right after college, I was applying for jobs, and my dad actually still lives in Albania, and I was talking to him how I’m not getting anything. And he’s like, “Well, why don’t you look into real estate?” And I said, “Well, what can I do in real estate? I don’t have money, I don’t have anything.” And he’s like, “Well, just Google some stuff, see what you can come up with.” And since I started Googling, I guess I never looked back. I found all my information on Bigger Pockets. That’s how I found just the beginning stuff, like okay, people can do this with no money. So that’s how it actually got started, and then once this, I was looking into it, I-

Dave:
The seminar?

Arvi:
Heard this … yeah, the seminar. I was in my car and I never listen to the radio, but for some reason, this time, the iTunes is not playing, so I heard this ad on the radio about a free seminar on real estate. We’ll teach you everything you know. I went there, and then they kind of upsell you on the three day weekend. I paid for that, right? I didn’t know that was the case, but I paid for it and I went home. And I hadn’t told Dave anything-

Dave:
Nope.

Arvi:
And at that point, that was, like, $400. But on a college budget, that’s a lot of money.

Ashley:
Yeah, yeah.

Dave:
I came home from practice, and all of a sudden, she’s like, “Yeah, I’m going to the seminar.” “Okay, cool. Is it free?” She said, “No, it’s about $400.” At that point, I was completely against it. In college, every dollar kind of counts in college especially. I was completely against it. Then to make it even better, she came home and she had some books with her. I’m like, “Oh, that’s probably not included in the $400.” She’s like, “Nope, it’s not.”

Felipe:
And we know as college students how much books cost too.

Arvi:
Right.

Dave:
Oh, exactly.

Ashley:
Yeah, that $400 could have paid for ramen noodles for four years of college.

Arvi:
Absolutely.

Felipe:
That’s hilarious. Now, and then what happened, Arvi?

Arvi:
So after then, I kept learning about it. I went to the seminar. I still had a million questions that I had unanswered. So I was reading as many books as I could, looking at as many videos or free information that I could. And then about, what, eight or nine months later, I got my first house to flip.

Ashley:
Wow, that’s awesome.

Felipe:
Wow.

Ashley:
Congratulations. So how long ago was this that you bought the first one?

Arvi:
This was just last year actually.

Ashley:
Yeah.

Dave:
Yeah, mm-hmm (affirmative).

Ashley:
Cool. Okay, so Dave, how did you get dragged into it then?

Dave:
That’s exactly what kind of happened, because I was so into basketball after college, I contemplated going professional, but I decided to stick around and try to do coaching. So I went to Florida and I coached for a prep school for about a year. And I was just noticing that she was really struggling when it came to the construction part and the renovation part, and I was always kind of hands-on when it comes to renovation, especially with my dad. He was kind of a handy man at certain times. So I decided … She kind of offered me, “Don’t you want to help out with the construction part of it? You can run the whole construction side and everything.” And I said, “Why not? I’ll give it a shot.” So I left-

Felipe:
She suckered you in, man. She suckered you in, bro.

Dave:
I left that job, came to cold Buffalo to finish up a couple of rehabs on the house.

Ashley:
That’s awesome. Yeah, so what has taken on since that first property? How have you guys grown and expanded since then?

Arvi:
Yeah, so after the property, we actually got another one, and then we did that one, and then we got another one. So in our first year, we did three flips. And then now, actually, we started doing our own marketing because back then, I was just going through a real estate agent. I kind of wanted to have that security that they were helping me out, they knew how to close, and kind of giving me some guidance for the process in general. And then, once we moved here to Nashville, we started doing our own marketing. And I believe since February when we started our own marketing, we’ve done six deals so far.

Ashley:
Awesome. And what are you doing, direct to seller marketing, like flyers or?

Arvi:
Yeah, yeah. We send out letters, pull out lists and we send out letters to direct to sellers.

Felipe:
That’s interesting. What part of your business, Arvi, do you handle, and then Dave, what part of it do you handle?

Arvi:
So I handle everything from doing the marketing, going to the meeting with the sellers and acquisitions, like making the offers, putting them under contract. And then once we … If we’re going to flip it or wholesale it or whatever the exit strategy is, then Dave takes over.

Dave:
Yeah, so I basically handle all the construction, the construction side of the real estate world basically for Arvi. I handle when it comes to inspections and estimating rehab budgets. I also besides from that, at certain times, we don’t have houses to flip basically or rehab, so I deal with regular retail clients as well. So besides from Arvi’s properties, I deal with regular retail clients and I do lot of investures as well. So I handle all the subcontractors, and … yeah.

Felipe:
As a newbie investor, how do you, Dave, handle the contractors? I mean, I guess you’re not a newbie any more. You’re grinding it out now, which is really cool, so kudos to you. But what are some tips that you have for our listeners when handling subcontractors?

Dave:
Subcontractors, as investors? I had some notes that as investors, there’s a lot of theories behind it. Some investors don’t like to pay at all until the job is complete. Some investors like to get 50%. I would advise what we use is 25, 25, and the remainder usually.

Felipe:
Love it.

Dave:
For example, drywall. I get my sub because drywall is a specific field. I’d rather sub it out to somebody that can get it done in three days. I give 25% of the contract when they start, 25% when all the boards are hung, and I usually give the remainder when it’s ready for paint. But I also usually, especially if it’s the first time I’m dealing with a contractor, I always take maybe $300 or $400 off for the last payment because there’s always some touch up in drywall that needs to be done, extra sanding needs to be done. And that kind of gives you the guarantee that the contractor is most likely going to come back because he wants the rest of that.

Ashley:
That’s interesting. I have a friend that was she does is, she’ll do … If they finish early, she’ll give them, like, $50 off per day. But if they finish late, she’ll take off on her bill $25 per day. So do you do anything like that, any kind of incentive for them to finish early where they get a bonus, or where if they are delayed, they get money taken off?

Dave:
Usually, no. So up to this point, I haven’t. I had a couple investors do that with me as well. However, for me as a contractor, you’re always going to come to that point where the contractors will probably charge you premium price for that. They’re going to charge you a higher price to get it done really on time that day, because they want to make sure they get paid.

Felipe:
No, that’s interesting, because the way I do it in Nashville, and we’re in the same neighborhood, but what I do with my contractors is, we agree on a 33 1/3% of the job as we’re going. So let’s say that they come in and they’re going to hang three boards. I say, “Okay, when you finish the first board, I’ll give you this amount. When you finish the next board, I’ll give you this amount. And when you’re done with the job, I’ll give you the rest of the 33 1/3. And like you said, this keeps them coming back to make sure that they get paid, because to them, it always feels like they’re a little bit behind on payment and ahead on the job, so they’re willing to come back and finish to get that next pull. So it’s really cool the way that you do it with the 25 and then leaves a little bit extra on the end. So I think that you probably have a better process than even I do.

Dave:
I don’t really tell them about the last part until that day comes, because if you build a relationship with them, they will definitely understand. If they’re good contractors, you will notice the reaction. If they’re like oh no, I need it now, I need the whole thing, then it’s probably not going to work out. But if they guarantee, like, oh, no problem, keep it, I’ll be back for sure, then you know for a fact that you’ve found someone decent, a really good contractor.

Ashley:
That’s a really good point, that if they’re not putting up a big stink that they need that $300 right now, that probably means they’re somewhat successful in their business that they can hold off on having that $300 until they finish the job. I want to kind of walk through, because I’m doing my first big rehab where I’m trying to contract almost everything out. So I want to use this episode for my advantage. What are some steps that you guys recommend from start to finish, and I kind of want to go into detail. So when you’re doing a rehab, what’s the first step doing your due diligence and your permits? Can you kind of walk us through that?

Dave:
Okay, yeah, for due diligence, basically get a permit. That’s just so important just to get a permit-

Arvi:
[crosstalk 00:13:11].

Dave:
A general building permit, plumbing, electric, and usually HVAC. You get the permits because this kind of ensures you that the work is going to be done the right way. For example, on the latest project we’re doing, not my best hire, the electrician failed the electric twice, and that set us back two weeks. Even though that set us back two weeks, I’m assured that it’s done the right way.

Arvi:
I guess from there, the second step is, so once you have the property, you have to do your due diligence, and you’ve got your permits, is to figure out the layout and design and what you’re going to demo, what you could keep from the project. So for example, I mean, especially if you’re flipping, everybody likes open concept now. So I’ve got to take into account, is the layout functional? Is it open concept? Would you and your family want to live there? So we try to make it seem like, so if we can’t live there, if we don’t like it personally, then probably other people are not going to like it too. So we try to make all the rehabs as if they were for ourselves. And then we choose on the design, depending on the neighborhood, price point of the property, how high end you’re going to go. Because you want to rehab good, but you also don’t want to over rehab and overspend on high end properties where the neighborhood is probably not comfortable with that.
And then the third thing to this step is to just demo. Are you going to completely gut the property? Are the doors maybe … Can they be reused, which is what we did in this last flip that we’re still working on. Just try to keep it … Because a lot of investors will just come and throw everything down and maybe not keep stuff that’s good. But just saving the doors in this property saved me $2,000.

Ashley:
Wow, that’s awesome. When you do that step, do you have a process, a checklist? Do you use some kind of workflow software to track all of this stuff? I mean, when you say, “I’m keeping those doors,” how do you communicate that to your contractors so that they accidentally don’t get painted or ripped down?

Arvi:
Absolutely. So I usually write … I do the first walk through of the property, and I have an Excel spreadsheet or something on my hand. I use an iPad, and I just go around and say, “Take this wall down,” or, “Take all of the drywall down here. Keep these doors.” And I mean, there’s a little bit more detail than what I’m saying here, but I’m ready for every single room and just the totality of the project. And then I hand that part over to Dave or whoever the contractor is that’s doing the demo.

Dave:
Yeah, it’s all on me. That’s really what it is, it’s all on me. Basically what I do is, the things that she wants to keep, for example doors or maybe a nice desk that’s in there, I keep it in a certain room. I keep it in maybe a closet in a room, and I tell my contractor, every time when a subcontractor comes in, I walk them through the property and explain to them, “Do not touch this. We’re keeping this.” We’re just making sure that you prove the point that we’re keeping this.

Arvi:
And the most important part is just keeping that communication, because even when we hire subs sometimes, they have their own subs, so the communication could get lost there. So we make sure that we just try to communicate at all times.

Felipe:
That’s really good. That’s really smart, because like you said, sometimes your contractor will have subs and communication is key to always have. I try to make it a point to stop by my properties at least two or three times a week, because I want the subs to meet me as well and be comfortable with talking to me. Because at the end of the day, you can tell a contractor one thing, but who’s doing the job? And that’s really important, because I’m sure the contractor is responsible, but the sub’s the one doing the work. At the end of the day, they’re the ones on their hands and knees grinding it out, so you definitely want to have that communication. Did I miss the question, or maybe we just didn’t ask, but how are you funding these deals? I mean, do you just have a super rich parent that funds all your money and you have a-

Arvi:
I wish.

Felipe:
An empty bucket to just grab as much as you want, or how are you funding these deals?

Arvi:
So we’re going through private lenders, sometimes hard money when that’s not completely open. For example, during the virus situation, the private lending was a bit more restricted. But most of them are through private money or hard money.

Felipe:
Why would you say that a lot of new real estate investors are scared to take that leap of using hard money? I feel like we get that question all the time, like oh, I just can’t get funding. But I go on Bigger Pockets and I can find 20 today that are like, I’ve got money to do. Why is that such a taboo? Why is it so fearful to do that?

Arvi:
I completely understand that part of it, because even on my first property, I had that same fear. Most of these hard money lenders or even private money, they’ll need to sign a personal guarantee, so you’re kind of on the hook for everything that goes on. And plus, even for myself, I don’t want to have a bad name. Like if something goes wrong and I don’t pay them, I never want to be in that position. So I mean, that’s a risk we take with every single property. It’s not like we did it on the first and that’s it, no more fears. That’s a fear and a risk every single time. But as long as you’re buying and if you have all your systems in place, so that’s why the systems are important. It kind of helps put that risk down so low to where it’s almost nothing.

Ashley:
Are your private lenders, are they involved in the process at all? Do they like to come and see the house? I mean, we’ve talked about the due diligence. Do they come and look at it with you? Do they ever have to approve, want to approve your layout or design, or it’s pretty much, they trust you guys, you guys handle everything, here’s the money and you run with it?

Arvi:
It would depend on the private lender. So far, the ones I’ve worked with, they like to come in. And we see that the rehab that I’ve estimated, it’s somewhat in the ballpark of what they think it’s going to cost. But if I’m saying, oh, it’s going to be $20,000 for rehab but it’s a full gut house, there’s some type of disconnection there. As far as the actual design or layout or anything like that, I personally don’t let them do that, just because I guess I just have more experience on the flipping side and I know what clients like because I’ve done it and will suggest on the investing, or on the lending part. And honestly, most of the time I haven’t had people say, or lenders say, “Why don’t you do this,” or, “Why don’t you do that?” It kind of leaves that up to the flipper.

Ashley:
Yeah, that’s great. I don’t think I would want someone telling me what to do and kind of take away from being self-employed on your rehabs. But let’s get back to what would be the next step then? Okay, so you’ve got demo, you’ve done your design, you’ve got your layout, you hae their checklist. Let’s bring in the contractors now. Do you use a general contractor, subs, and let’s talk about the mechanics of the house.

Dave:
Yeah, so usually there’s two ways you can go with it. You can go with subcontractors or go to a general contractor. It really all depends what the budget is. If you want to just be laid back and focus on more leads or focus on more properties, then yeah, a general contractor is definitely the way to go. But if you want to be more hands-on and learning and seeing what the process is and how long it really takes and how they work … For example, if you want to learn how to do drywall or tile, stuff like that, then I would definitely go with subs, subcontractors. I mean, that way you kind of save some money as well and you learn more.

Arvi:
Yeah, and one thing we’ve figured out with subs is, it’s harder to fire a general contractor than it is to fire a subcontractor. So if somebody is not doing their job right, I can just go directly to the drywall sub and say, “Sorry, man, this is not working out.” But if it’s a general contractor, it’s just harder to do that in general because they have the whole project.

Felipe:
Yeah, I have also found that to be true. And personally, I only do sub work now. Growing up in the construction field, I learned, like you just said, subs are, I don’t know, for some reason generally a little bit easier to work with than just a contractor who has everything. Because if his electrician sucks, you can’t fire his plumber because his plumber was still good. So out of curiosity, do you guys have your GC license and your real estate license? Because you guys would be a great team.

Arvi:
So I don’t have my real estate license.

Dave:
I was a GC in Buffalo, New York, although in Nashville right now, I have my home improvement license.

Arvi:
It’s a little bit different here.

Dave:
Yeah, it’s a little bit different, but I’m working on getting my GC license, because in Tennessee, you do have to study and pass a bunch of exams for that.

Felipe:
Yeah, good for you, man. I would challenge you guys to do that, because that potential is clearly there. You have the experience. I mean, I would hire you guys to do mine. I mean, I think it’s great what you guys are doing. So that’s really, really cool. Okay, so let’s keep going. What’s next on the list? What’s next to getting the next part of the deal done?

Arvi:
It’s the mechanicals and kind of inspecting before closing walls. And do you want to expand on that more?

Dave:
It’s basically, that gives you that assurance we talked about kind of at the beginning. That gives you that assurance that the plumbing is done right, the plumbing and electric is done … It’s so important, and people don’t understand, but this is probably the most important step to getting all these inspections done.

Arvi:
The reason why we know that is because we’ve had that happen to us where we’ve closed walls in the past and then the inspectors come back and say, well, we didn’t get an inspection and we thought we did, or the sub that technically pulled the license but he never did.

Dave:
Exactly.

Arvi:
So that’s why now we make sure. At least in Nashville, it’s a bit easier, you can actually apply and see online everything when you pull it, so you have that extra assurance. But-

Dave:
I mean, to be clear, this happened one time with electric, and I was not in the picture yet. She was doing the rehab, and I was not at the time-

Felipe:
Let me clear my name, he said. Let me clear my name.

Dave:
I was not the contractor, and she gave me a call and she said, “Yeah, we have to open up almost all the walls.” I’m like, oh my-

Arvi:
Yeah, that’s when he said, “All right, I’m coming to save you.”

Dave:
I mean, this is it. This is it.

Ashley:
Do you guys have any tips for … Are there certain things that when you are interviewing a contractor or he’s quoting a job that just kind of turns you off from that contractor? Like for me, a couple things I’ve noticed just from the few that I’ve hired is if they don’t write things down and take measurements that first day, I feel like that is a huge red flag for me. Do you have any-

Felipe:
I can already see Ashley handing them the measuring tape, “Hey dude, get this on paper. What are you doing?”

Ashley:
And I just, is there anything like that that you guys kind of look for in a contractor that is kind of a red flag as to not to hire them?

Dave:
Yeah, so usually for me as being a contractor, I like to have time at the property. So if you walk me through the property, okay, cool, cool. You’re not going to see me take measurements. I’m basically just listening to the idea, taking notes, mental pictures. But when it comes to actual putting the time in, let the contractor be … If the contractor, let’s say he asks, “Well, can I get 10 minutes just to take measurements?” Usually what a contractor will do, he’ll take measurements, he’ll take pictures. He might make a phone call. He might make a phone call to his plumber, electrician, to ask them some questions to clarify on stuff.

Felipe:
That’s interesting you say that, because I’m actually the same way. Ashley probably wouldn’t hire me then just based on what you’re saying. I’m actually the same way. I like to walk around with … I’ve had clients privately call me or reach out to me and say, “Hey Felipe, would you mind helping me build that two bedrooms downstairs?” I’m like, “Yeah, for sure. I’ll help you do that.” And in our initial conversation, I like to walk around with the client, just listening, to understand what they want to say, not necessarily reply. I’m just there as, okay, soaking it all in. What is their vision for this? And then, I don’t destroy their vision, but I say, “That’s probably not going to happen. This is more like reality.” Dave, would you say that’s probably pretty accurate?

Dave:
That is very true, especially when-

Felipe:
Outlandish vision.

Dave:
Especially when they give you the budget and they tell you, “Look, I want this, this, and this.” I’m like, “Eh, that’s”-

Felipe:
No, no.

Dave:
“That’s not possible.”

Felipe:
You going to get a closet maybe.

Ashley:
Well, I need to clear my name here. And when I say that they don’t take measurements or write things down, they still are giving me an estimate.

Dave:
Yeah.

Ashley:
So I feel like it’s hard to give an estimate when they didn’t write down exactly what I wanted. And actually, the worst that happened, the guy forgot to put flooring into his estimate.

Felipe:
What?

Ashley:
Right there’s a big red flag.

Felipe:
That’s terrible.

Ashley:
The flooring is one of the easiest things, but he didn’t measure, and he just forgot to add it in. And he told me he accidentally sent someone else’s bid to me, but it was like, I had a custom sliding barn door. How many other bids had that for him? But, so it’s like-

Arvi:
Well at that point, yeah, that’s probably not a good I guess contractor.

Ashley:
Yeah, yeah. Yeah, I didn’t go with him. Okay, so now that we have closed up the walls, what’s next?

Arvi:
So once you close that, I mean, it just comes down to painting, the finishing touches like painting, you’re putting on the kitchen, closing in the bathrooms, tile, flooring, and all that stuff. So at that point, so in my personal projects, I like to have all that already figured out before we get to that point so there’s no hiccups. If they get to the point and I don’t have the paint color picked out or the kitchen cabinets are not ready and all that stuff, then that just puts us back on the rehab, especially on flips. Time is money. The sooner you’re done, the more you’re probably going to make. So I usually when I had mentioned earlier when I did that initial walk through, I already have an idea of what I’m going to paint, what colors I’m going to choose, and what the overall design is going to be on the property.

Dave:
And for me, that’s a tip to anybody that’s basically, if you’re doing it yourself or you’re hiring contractors, what I usually like to do is I like to walk around a property, especially after drywall, after paint, I like to walk around with a piece of tape, blue tape, and I just mark, like oh, this trim needs to be replaced, and this needs to be sanded down a little bit more. I just like to do that. And after that, don’t be scared … If anybody is doing it themself, don’t be scared to spend a little bit more money on material, especially when it comes to trim or flooring. If it’s not done right, if it has too many gaps or too much caulking, it’s going to ruin the whole thing. If you’re trying to sell the house, people are going to walk in and it’s like, ooh, that’s not really done professionally. What else is not done professionally in the house?

Felipe:
That’s key right there, Dave. I’m so glad you said that. So I’ve flipped a couple properties I my days. No, I’m just kidding. But it’s true. And even more than just the seller, I’m more scared of the inspector. If the inspector comes in and finds one thing, he’s going to dig into that even further, right? So if you can’t get the basics down, having little things, like having a level light in the bathroom, or like you said, is there too much caulking on certain pieces or are doors a little rougher than they should be? They’re going to be like, well, I wonder what else they cut corners on, right? So I love that you said that. I think that’s really key. People need to listen to that part again. It’s in the details, because like I said, more than just the buyer of the property you’re going to flip it to, it’s the inspector who’s going to come in. And if he finds one thing, man, he’s going to go through it.
I’ll never forget, I saw an inspector one time. He said that he’d noticed that the door to get to the upstairs attic wasn’t enough insulation on it. So what he did was, he brought in this measuring thing and checked all the walls to make sure that all the insulation was the right way. Because you know how insulation has a certain way that you have to put it in. So he went through and destroyed this guy’s flip. And he said, “All your insulation is wrong.” Lost the seller. But it was all because he didn’t put the insulation back on the covering to get to the attic. You know what I’m talking about, the attic door?

Dave:
Yeah, yeah.

Felipe:
And it has insulation on top. So apparently the insulation wasn’t put back. And he was like, “You’re getting too much heat. You know what? Let’s just go ahead and check all the walls.” Ouch.

Ashley:
And it’s not even the inspection, it’s your name too, your brand name. I mean, word of mouth and referrals are one of the biggest assets you can have, and you want them to be good.

Arvi:
Yeah, yeah, for sure. So we’ve had that happen too with inspectors. One of our properties, there was a little bit of mold in the basement, especially in Buffalo where you get the basement. Then it wasn’t just a little bit of mold that we could have fixed. And he was like, “Well, this is probably all mold in the whole house.” And the buyers backed out, so an inspector can really make or break your buyer.

Dave:
Mm-hmm (affirmative).

Felipe:
100%.

Arvi:
They have power into the buyer.

Felipe:
And when you-

Ashley:
And especially something with mold too, where it could just be one little area, but someone can blow it up, well, it could be in the whole house. You don’t know, but … Better to take care of it sooner rather than later. Okay, so what about the finishing touches? So we’ve got the little things. You go through, do your walk through. Then you have contractors come back and take care of those things, and then do you do one last final walk through together?

Arvi:
Yeah, absolutely. So our last walk through, or I guess our last step, is once everything comes together, are we going to stage it? Is it over the price point to where we stage it? Are we going to go with a professional stager or maybe stage it ourselves? I have done before on properties where a little trick I learned actually through Bigger Pocket discussions that people were staging it through Rent-a-Center. And you can go-

Ashley:
Oh really? Oh wow.

Arvi:
Yeah, absolutely. And that’s what I did on my first flips. I said, this is great. I can go in, because you can rent TVs, washer and dryers if you wanted to, pictures, couches, and everything from there. So that’s what I did on my first flips. I staged them with Rent-a-Center. I went there, I picked everything out that I wanted. They come deliver it and set everything up for you, and then in a month or whatever, however long you want to keep them for, they come and take everything back.

Felipe:
That’s a really cool hack. I’ve never thought about that. Somebody should hashtag that, like #rentacenterhack. Because yeah, I’ve heard that you can make an extra five or 10 Gs just by visually showing somebody what the layout looks like. One, a lot of people don’t have the vision that you might have, but two, there’s a ton of out-of-state investor investing in Nashville, and if they have pictures of a beautifully furnished home, they’re going to be more prone to buy that than just the empty gray walls, white baseboard type of house. So that’s a really cool hack. I never thought about that. I’m going to have to do that. Now, I’d be really upset if I was the guy having to deliver the furniture and pick it back up in 30 days.

Ashley:
Yeah.

Arvi:
But when I went to the Rent-a-Centers, I was like, “Listen, I’m a flipper,” and she’s like, “Oh yeah, we do this all the time for flippers.” I was like, “Okay”-

Felipe:
Oh really? So they know this concept already.

Arvi:
Yeah, absolutely.

Felipe:
Oh, there you go.

Ashley:
Have you ever done online staging, where it’s just the pictures?

Arvi:
We have not. I know a lot of investors that have had a lot of success with that, and I think we’re going to try that on our next flips. So it is cheaper than going through even Rent-a-Center or doing it through a professional stager. And they look great. I’ve seen pictures that they just look like the furniture is actually there.

Ashley:
Now, when it’s time to sell, you’ve got it staged. Do you guys do for sale by owner, or do you have a realtor that you work with?

Arvi:
No, we usually just list them with a realtor. It’s just quicker and easier, and it just takes one step off, or one thing off my shoulder basically. And you just get way more exposure. I guess you can try to sell yourself, but we just prefer to go with realtors.

Ashley:
That’s one easy thing to outsource.

Arvi:
Yeah, absolutely.

Felipe:
Arvi, Dave, what are some tips and tricks that you would give to people that are listening right now that are newbie investors, that they’re ready to do a rehab, it’s on a budget, they’re a little nervous about going in, it’s their very first one. What are some tips and tricks that you would give them so that they don’t make the same mistakes that maybe we’ve all made, right? So let’s add some value to our listeners. What are some tricks that you would say, “Guys, you’ve got to do this.” And I’m going to go through the list real quick and then see if you can add just whatever you can think of.
But we went through due diligence and permits. We said layout, design, and demo, the mechanicals and inspections, closing up the walls, kitchen, paint, flooring, finishing touches, punch list, and then Dave running around with tape tagging stuff that he doesn’t like. So on top of that, what would you say, “Hey guys, you’ve got to do this?”

Arvi:
So there’s some investors that go all the way out and get the retail inspection done before they even put it on the market. We haven’t felt the need to do that, but if you’re really nervous or if you even wanted to check on your contractors as a further step, you can absolutely do that. But what I personally did in the beginning before I even bought the flips, I would pay an inspector and I would walk through with him and kind of basically learn everything that they were pointing out. And he would tell me, “Well, this is not right,” and I’m asking, “Why is it not right? What’s going on there?” A lot of it is just going to be through the experience as well, so the most important thing is just getting that first step and-

Dave:
For renovations, I would say try to do stuff yourself in the beginning. In the beginning phases, try to do certain stuff yourself. You’re going to fail. I’m telling you. I’m telling you right now, you’re going to fail miserably at a point that you’re going to feel like you don’t want to do this any more. But that’s really part of it. If you don’t put the work into it, you won’t realize how hard it is to do certain things. When people get quotes for, let’s say, drywall or anything like that, or putting in tile, and a lot of people, a lot of clients are like, “Oh, it’s just putting in tile.” No it’s not. It’s not just putting in tile. It’s not just putting in drywall. So trying to do stuff yourself in the beginning phase is really key. And the other key I say is, have close friends and family that are maybe into the construction world that can possibly come help you out in the beginning, give you some tips of how to start, and make sure you’re on the right path.

Felipe:
Okay. Cool, I love that, giving some confidence to some of those newbies. Before we transition into the rookie deal that we want to talk a little bit about, let me ask you this. What advice would you give to brand new listeners or brand new people in real estate that are like, okay, I’m going to go hard money. I know that I can do this. How would you advise them to talk to those lenders? Because I feel like that’s … Hard money lending or private money is all about relationship building or feeling confident. So what would you tell our listeners, say, “Hey guys, these are some key tips and tricks when you’re out there recruiting money, if you will, for your deal.” What would you say?

Arvi:
Well, I’ll tell you what I did and it worked great with me. When I hired my first private lender, and we were kind of both interviewing each other because he wants to make sure I’m right, but I also want to make sure that he’s right for me. But I make a packet of just kind of introducing myself and my business and what my goals are for the business and where I see myself in maybe a year or two. Or I also wrote down pretty much everything that the flip needs so he could see. Like when I showed up, we actually had a lunch meeting, I showed up, I told him, “Listen, I brought this thing. It just explains a little bit more about me and what I’m trying to do with the flip.” And he was just like, “Oh wow, this is great. I’ve never had anybody do this.” And we ended up working together. So that’s just another way of adding confidence. And you may be new, but you’re showing them that you are doing your due diligence, that you have a system in place and you’re going to try to minimize risk as much as you can.

Ashley:
I love that, because I’ve done the same thing before. And now, you probably include your past deals in it too, right?

Arvi:
Oh yeah.

Dave:
Exactly.

Ashley:
Yeah. The more information you can provide, the better, for sure.

Arvi:
Absolutely.

Ashley:
Yeah. And Dave, are you involved in the money part at all, or Arvi handles that?

Dave:
Not really. Sometimes she kind of uses me, because sometimes I’m on site and I’m there with an investor, and I’m like, wait, we didn’t schedule this. And I’d have to walk them through, like, “Yeah, this is what we’re going to do,” and make them feel sure. I’m like, “This is going to be something nice,” boost some confidence in them. But that’s, yeah.

Ashley:
The hype guy.

Dave:
Yeah.

Ashley:
Okay.

Felipe:
It seems like Arvi just keeps dragging you meetings and deals and real estate. Well, look, man, when you get your Ferrari or your Tesla or whatever your dream car is, you’re not going to feel like you got dragged in any more, so stick in there, man. It’s worth it.

Dave:
Exactly.

Felipe:
That’s hilarious.

Ashley:
Are you guys doing this full-time now? For the past year, it’s been full-time? You haven’t had any other jobs right now?

Dave:
Yep.

Arvi:
No. Even when I started, this was full-time. I actually had a part-time job when I first started, and then about four months into the whole investing thing, I just dropped it and we’ve been doing this.

Ashley:
Wow, that’s so cool. Okay, well, let’s break into your rookie deal that you guys want to share with us. Where was this deal? Was this in Buffalo or Nashville?

Arvi:
So I’m actually going to talk about one in Buffalo. This was a duplex. It had been listed on the MLS for probably six months, and nobody had even touched it. And it would expire and then come back on the market. It was in an amazing location, like right in downtown Buffalo, walking distance to everything. And it just needed a lot of work, which is why people I guess didn’t want to give it the time of the day. And it used to be a triplex, and then they had it taken down into a single family at this point. So I knew that the only way to make that deal work was if I turned it into a duplex. So before I even put an offer in and I was doing my due diligence, I went to the city and I asked about this property, if it could be turned into a duplex, and they said, “Yeah, absolutely. I don’t see a problem with it.”
So I believe they had it listed for $99,000. I got it under contract, or I bought it for $90,000. Obviously, we put a lot of work into it. We put, I believe was it $85,000 to $90,000?

Dave:
$85,000 to $90,000. When you walk through this place, when I first walked through this place, I told her no. I told her no.

Arvi:
He said, “This is your biggest mistake.”

Dave:
I saw so many problems. Like, no, let’s not do this one.

Arvi:
Yeah, but at that point, I had made up my mind, and I just really believed in the location of that property. So that’s why.

Dave:
She had already signed it. I walked through the property, and I was like, “No, I’m not doing it.”

Felipe:
I was waiting for that. I was waiting for, “Actually, babe, it’s already there.”

Dave:
Yeah, it was already there.

Ashley:
One of our shows, I think it was maybe two or three weeks ago, we had Elyse sat in. She said, “You can take the crap out of the house, but you can’t take the house of the crap,” saying the location is key.

Dave:
Yeah.

Arvi:
Absolutely. And that’s why when I-

Ashley:
Is this your first deal, second deal, third deal?

Arvi:
This was my third.

Ashley:
Third deal? Okay. So what was the next step after you signed your life away?

Arvi:
Right?

Felipe:
Y’all’s life. Y’all’s, in the South, y’all’s life away.

Arvi:
Right, so we finished it up. I originally thought the rehab was going to take three months, but it actually took us five months to complete the whole thing. And that’s why I leave the construction side to him, because I’m not good at the rehabbing part. And so yeah, so we rehabbed it, and we actually refinanced out of it as a commercial loan. We were originally just going to keep it as a rental, but at that point we decided, we’re already here. Why not house hack this thing? We love the location, it’s right there. So let’s just house hack it. So that’s what we did up until the point that we moved to Nashville, which was in January. And since then, we’ve been renting out both parts or both sides. And we cash loaned it really good. Our net cash flow on this property is, like, $1,000.

Ashley:
Wow, that’s awesome. That’s great.

Felipe:
Nice. Dave, have you learned to trust Arvi now, or are we still kind of hanging out?

Dave:
Yeah. Yeah, it’s getting better. It’s getting better.

Felipe:
Is it getting better?

Dave:
Yeah, yeah.

Felipe:
It seems like she’s crushing it, man. You might want to follow that one, buddy.

Dave:
I know, I know it.

Felipe:
You might want to follow through. She seems like she’s crushing it.

Dave:
I’ve got to keep her on her toes, though. I can’t give her all the confidence.

Felipe:
That’s right, that’s right, that’s right.

Ashley:
So when you guys purchased this, you used private money-

Arvi:
Yes.

Ashley:
For the deal, and you used that for the rehab too?

Arvi:
Yes, correct.

Ashley:
And then, did you refinance into long-term financing, and what did that refinance process look like?

Arvi:
So it was just a long term refinancing. At that point, we hadn’t decided to house hack it, so I’m glad we didn’t go with that, the FHA side. So we just got a commercial loan. It’s under a business name, so we just got a commercial loan on it for 30 year fixed. I forget what the rate is on it, to be honest with you. But yes, it’s just a fixed 30 year.

Ashley:
Great, great. Yeah, and then, what if someone wanted to kind of re-create that same deal? Can you kind of reverse engineer it for us as to what advice and tips can you give to someone to kind of find a duplex like that or a single family and turn it into a duplex?

Arvi:
So the first thing I would say is before you even put an offer in, make sure that it can be turned into a duplex, because the zoning is different everywhere. When I went to get my … To ask for that, that street could be turned into a duplex, but then the street over could not. And it was the same street name, but it was just across the other side. So that’s super important to if you have a vision of free zoning certain properties or land, whatever you’re buying, you’ve got to make sure beforehand, because if you buy it and then they tell you no, then it’s going to break your deal basically, your whole vision.

Ashley:
And who is they? Who did you go to? Is it the building inspector, the city clerk, the tax assessor? Who do you go to to ask about that?

Arvi:
That’s a really good question. I went to the city, the city of Buffalo I guess when I was there, and it was the building for the inspector and the zoning office. So once you go-

Ashley:
A code enforcement officer?

Arvi:
Yeah, so once you go over there, they kind of redirect you, “Okay, this is the best person for you to talk to.” Because I mean, at that point, I didn’t know how to do any of this. That was a learning experience for me too. I just went there, and the front desk person, they just guided me in the right direction.

Ashley:
And that’s a good point is you didn’t know, so you just went and asked. And look, you found out they [inaudible 00:42:02]. Sometimes all you have to do is start somewhere.

Dave:
You’re probably going to go back a couple of times because you’re probably going to miss some documents, but that’s … And they’re not always nice in that setting. They’re always like, “Okay, you’re here for what?” They’re going to be annoying about it a little bit sometimes, but just, you have to do it.

Ashley:
But it seems like it was worth it for you guys.

Dave:
Yeah.

Arvi:
Oh, absolutely, yeah.

Felipe:
So let’s move on to the next section of our show, and this is probably one of my favorites. It’s just called the MVP. So in this part, we want to know about a key player on your team. This could be an agent, lender, handyman, deal finder, your partner, whatever the case may be. Who is an MVP in your real estate journey that you would say, “Man, it would be a lot harder to do this if this person wasn’t on our team,”? So who would you say that is?

Arvi:
So when I first started, I’ve got to give it to my agent. She had a lot of experience with working with investors. She knew a lot of contractors. So she was just really knowledgeable in that part. And she helped me find the good deals too. You walk through so many properties together, and she’ll be the one to tell me, “Listen, this is not the greatest area, and it’s probably not going to give you the greatest return. Let’s try to find something else.” So having somebody, especially when you’ve just started, to kind of give you that feedback, it was super important to me and definitely helped me a lot to kind of get my bases right so I can grow later.

Ashley:
And how did you find her?

Arvi:
So she was actually through a referral on referral. When I was in college, my career advisor, actually her husband was an inspector, a home inspector. So I went to her because I knew that before, and I said, “Listen, this is what I’m trying to do.” She’s like, “Yeah, feel free to call him, talk to him.” So I did and then when I talked to him, he said, “Do you have an agent?” I said, “No, I’m just still trying to get started.” He was like, “Well, I have a great referral for you.” So that’s the networking and talking to people about what you’re doing, it’s always key I’ve found in this business.

Felipe:
Well, let me give you a two-part question. How do you manage communication with your MVP to continue to have deal flow running through, and then how do they get paid?

Arvi:
So in my case I guess as an agent, they were … On the MLS, you can set up a search on certain criteria that you’re interested in buying from. So she would set up a search for me, and every time that I’d sell a house, I could check my criteria. I would go ahead and take a look at it, walk through it together and all that stuff. And then as an agent, they will just get paid when we close on the deal.

Ashley:
And Dave, would you say that the realtor is your MVP too?

Dave:
Not necessarily-

Ashley:
Or is it Arvi finding all the good deals, doing the acquisitions?

Dave:
But for me, I had a mentor. I had a mentor on the construction side. I had a mentor in Buffalo, somebody to kind of guide me through it, through running a construction business and actually recognizing good subs honestly. And I didn’t pay him. I didn’t pay him, but I added some value. I was always kind of there if he needed me, like, “Dave, I need an extra had at a job site today. Can you come help?” And I basically worked for free. And some people might not do that because they think you’re a business owner, but I took that chance and because he was teaching me so much. I figured the best way … I didn’t have that much capital to spend on just a mentor, because that can get expensive. Mentors in any profession get expensive, so I decided just to add some value.

Ashley:
And sometimes, the best mentors are the ones that aren’t paid. I mean, yes, there are great paid mentors, but you have that personal relationship with each other, and that’s why it works because you’re helping each other. And there doesn’t need to be a cost associated with that. That’s great. Well, thank you guys for sharing. And if anyone wants to learn more information about the MVPs this week, you can go to biggerpockets.com/rookie19.

Felipe:
Yeah. And then, just a reminder, I think on our last episode, the young gentleman said he would fly out to go talk to his mentor, speaking about what Dave’s talking about. He would fly out when he had an important question that he wanted to talk about with his mentor, because he valued his mentor’s time that much. So no, I don’t think working for free for your mentor is a negative thing at all if you don’t have finances, or if that’s the only way that you can add value. I feel like a lot of times, people are like, “Oh, well, I’ve got to pay for a mentor,” and that’s just not true. If you can add value to your mentor, you’re going to have a great relationship with that person. Anyone who wants to add value to me or to anyone, that’s going to most of the times probably be more valuable than money. Most of your mentors have money. What they don’t have is the time any more, so they need that. They need your time.

Arvi:
Yeah.

Ashley:
Yeah. So Dave, when you would fly up to visit your mentor, let me know so I can hire you for a few days.

Dave:
Okay. Sounds good.

Ashley:
Okay, so let’s move on to the rookie requests line. This is where we have our listeners call in and ask a question, and we’ll have you guys answer it. If anyone else would like to call in, you can leave us a voicemail at 1-888-5-ROOKIE. And this one is from Brendan.

Brendan:
Hey, my name’s Brendan Park. I just have a question for you about direct sale marketing. Basically, how does it work? I went out and I was writing letters and leaving them on people’s door, but that would take me all day, and I’d maybe do 100, 200. I wanted to see maybe how you could do it online or come up with a database where you can get people’s addresses. I kind of want to jump into how exactly you would start and go about doing that.

Arvi:
Yeah, absolutely. And that’s what we do. I pull the lists online and I hire a company to do all the writing for me. When I first started out, I was actually handwriting myself too, a couple hundred a month. But it’s just not sustainable. I started to not have time with flips going on and all that, so it was just best to hire it out. So I guess my tip would be, look into your county records, wherever you are, like in Nashville, Buffalo, wherever. Look into country records to pull lists from there. That’s pretty much a free way to pul them so you don’t have to spend any money. There’s also companies that sell you the lists. I think ListAbility or ListSource is one of them as well. So I would just pull them from there. You can go put your criteria, like seniors with equity or whatever the criteria is that you’re trying to go after, you can just pull it from there. And honestly, the best thing to do is just hire a direct mail company to do that for you, because it is just so worth the money.

Felipe:
Yeah, I agree. And then it’s always important to hire a professional in your field, because you already have certain things that you’re focusing on, right? Dave’s focusing on construction. Arvi, you’re focusing on acquisition and getting financing and making sure that property is where it needs to be. The last thing you want to do is go home and write 100 letters, right? Select what you are good at, do that, and leverage everything else, and that’s going to make you super successful in your business. And I think you guys are crushing that for sure, so kudos to you guys. I’d love to come visit one of your flips and kind of steal some ideas, so that’d be really cool. We should do that one day.

Dave:
Absolutely. We have one going on right now, actually, so might as well.

Felipe:
Let’s go. I’ll be back in Nashville in a week. What’s up?

Dave:
All right.

Arvi:
Awesome.

Dave:
Let’s get it.

Felipe:
Let’s do it. All right, hey guys, so just to kind of wrap this up, we do have a little bit of a fun here. We like to ask you three or four questions to kind of get to know you a little bit better. Is that okay with you guys? Are you ready for that?

Dave:
I have a question for you, though. There’s a rumor going around that you have small biceps or something? Is that something? I heard about it. I’m not-

Felipe:
Where are you at, Dave? Where are you at, bro?

Ashley:
The bicep stuff just keeps getting better and better.

Dave:
You’re playing right now. All the gyms are closed. I can’t compete right now.

Felipe:
Arvi, put him up, big dog. Put him up. What do you got there?

Arvi:
[inaudible 00:49:48].

Dave:
No, I’ve got a little … Okay, you win. You win. You win.

Felipe:
Okay, now it’s personal. The last gentleman on our show was in a military school-

Dave:
Oh boy.

Felipe:
And he posted it up. And I was like, Lord, let me … I sunk down in my chair. This guy filled up both sides of the-

Ashley:
Oh yeah, that’s when we did the selfie for Instagram that you guys, yeah, both put it, yeah.

Felipe:
We’ve got to take an Instagram picture with you guys as well. That’s hilarious. I love that. I can’t believe I just got called out on that. Ashley, I hate you by the way.

Ashley:
So now the new thing-

Felipe:
Ashley started that.

Ashley:
Is people aren’t going to want to be the guest to talk about real estate, they’ll just want to come on and have a flex off with Felipe.

Felipe:
That’s hilarious.

Ashley:
Okay, so let’s talk about, what’s a bucket list item that you guys both would like to cross off? Doesn’t have to be the same thing that you have together. Separate things.

Arvi:
I personally, it’s on my bucket list to go skydiving. I’d really scared to do it, but it’s one thing that I think I can do.

Dave:
Personally, I just want a Range Rover, man. I mean, she always talks to me about, “What car do you want in the future when we become millionaires?” and stuff like that. I’m like, “I just want a Range Rover. That’s the only car I want. That’s the only car. I just want a Range Rover.

Ashley:
And I love how you say when we become millionaires.

Felipe:
Yeah, come on, Arvi’s-

Ashley:
Not if we become millionaires. I love that.

Felipe:
Yes. Arvi and Dave, you’re speaking it into existence. I love that.

Ashley:
Yeah, yeah.

Felipe:
When we become. You have that belief. That’s awesome. So let me jump to the next question, and this comes from a more personal level from the heart. My family immigrated to this country as well, and we’ve gotten a lot of pushback in the past and we’ve overcome that in everything that we do. And I was just wondering, both of you guys said that you immigrated to this country, and it seems like just not too long ago. What obstacles have you had to overcome, and what advice would you give to other immigrated investors as to how to push through those?

Arvi:
Well actually, we’ve had so many-

Dave:
So many.

Arvi:
I can’t even count. I guess the first thing would be a language barrier. We in our countries, at least we were grown with the English being as a second language, so it was kind of easier for us. On our parents’ space, it wasn’t as easy. My dad, for example, he doesn’t really speak it that well, but he can still make his way through America and still be fine. But that was the first thing. I guess from there is just kind of fitting in. Our cultures are so different, and it was hard for me the first year. I didn’t have any friends. I was the loner in high school because I just couldn’t make any friends. I didn’t know how to fit in because it was so different. From there, I guess just getting into college, just … I don’t know, it was … How was yours?

Dave:
Just for international when you come over, I moved here when I was 15 by myself basically. I took the chance to come here and to eventually create a better situation for me and my family and for my kids. That’s the ultimate goal. And I think that we should always keep that in mind, especially international, that there’s an extra motivation. Even though you have extra motivation, it’s the most important thing to adapt. If I haven’t adapted to becoming a salesperson or becoming a contractor, it wouldn’t have worked out for me. I would not be in this situation right now.

Felipe:
I love that, because one of the things that I had to get accustomed to was … And I was born and raised in Nashville. But growing up with a Latino family, I still had the culture and relevances that I learned with my family, but then I also had to learn the customs and cultures of Nashville. And it was hard, because let’s say that I was American and born in Nashville here and then my parents had the customs of here. Then I only had one customs to learn, right? But for example, you meet a Latino family, you’re given a kiss on the cheek. You meet someone else outside, you’re doing a handshake. And I know that sounds so simple, but that’s another thing that you have to think about. Okay, who am I meeting, what is their culture, how do I adapt, right? So I completely agree with what you’re saying. For example, another thing, in our culture, there’s no such thing as contracts. Everything is based on a handshake, and your last name means everything.

Dave:
Everything.

Felipe:
Oh, that’s the Mejias, they do this, right? That last name is more honorable than a contract on paper. But here, everything is contract, and everyone’s out to sue you or try to get one over on you. So that was a lot different as well. I don’t say this a lot on the show, and I don’t give this advice to a lot of people, but a lot of my Latino subs, there’s nothing on paper. We meet at the job site, we shake hands, we agree on something, and I’ve yet to have one screw me over on that. Because their name is more respected than just a piece of contract.

Dave:
That’s true.

Felipe:
So I get it. I mean, I get what you’re saying.

Arvi:
And we completely get where you’re coming from. Actually, I would say all of them, all of our subs are Latinos too. That’s where we see ourselves more, because even the cultures, all the things that you just mentioned, they relate completely to our cultures. And actually, Albania is not one kiss on the cheek, it’s two kisses. And whenever Dave would meet my family, he’s always confused. I’m like, okay, which one?

Dave:
Still like it though. I’m not going to say no to kissing.

Felipe:
No, that’s true. That’s absolutely true.

Arvi:
Yeah.

Ashley:
Well, thank you guys for sharing that with us. I appreciate that.

Dave:
No problem.

Ashley:
And hopefully it can inspire-

Felipe:
I promise you, that question was not on the list.

Ashley:
Yeah, yeah. Hopefully it can inspire some other people too that are wanting to get into real estate and have some obstacles that if you guys can do it, so can they. So thank you for sharing. When you guys were kids, what did you want to be when you grew up? Probably wasn’t a real estate investor.

Arvi:
No, absolutely not. I personally always saw myself as a CEO in a corporate, that type of stuff.

Dave:
For me, I was trying to be a basketball player. I was just trying to go pro. Honestly, that was my main goal. After that, I’m good at drawing too. I wanted to be an architect, but couldn’t really afford that profession. So I stick with basketball.

Ashley:
Well, you’re designing houses, so you’re doing the fun part of architect. You don’t have to do all the actual drawing.

Felipe:
Dave, you keep talking about basketball, man. Look, I’m in Nashville. We can get to a park, bro. We can play some one on one.

Dave:
I am down.

Felipe:
You sure?

Arvi:
See what Dave [crosstalk 00:56:02] talk to us?

Felipe:
I am there.

Ashley:
Yeah.

Felipe:
Okay, because I like to hoop, man. I like to hoop.

Dave:
No doubt.

Felipe:
Do you know NAC over in Antioch?

Dave:
Huh?

Felipe:
Do you know NAC over in Antioch?

Dave:
I heard of it. I heard of it.

Arvi:
Yeah.

Felipe:
Yeah, yeah, yeah. Let’s go. I got you.

Dave:
All right.

Felipe:
I love it. No, you guys are awesome, man. I love this. This is probably going to be another one of my favorite podcasts upsets. But for the last question, we have a little bit of rookie hazing. Now, we’ll help you out here a little bit. What is your guilty pleasure song? Would you like to sing to us a little bit of that song as well? What have you got?

Dave:
Ain’t No Mountain High Enough.

Felipe:
Come on.

Dave:
We sing that song sometimes during rehabs-

Arvi:
And flips.

Dave:
Flips, and stuff like that when it’s not going well. So here we go.

Ashley:
That’s so funny.

Dave:
You ready?

Ashley:
Because he just had that too, so when [inaudible 00:56:42] said that, that’s really funny. It’s very-

Felipe:
Go for it. Go for it.

Ashley:
Yeah.

Dave:
(singing). Come on. You’re not going to sing with me?

Arvi:
I cannot do this.

Dave:
I’m not singing if she’s not singing.

Felipe:
Dave, no. Let’s go, bro. I got you.

Dave:
(singing)

Felipe:
(singing)

Ashley:
(singing) Come on, I have a-

Felipe:
Oh, you left Ashley by herself. That’s hilarious. I love that. Arvi, what about you?

Ashley:
Okay-

Felipe:
What’s your favorite sing?

Ashley:
Yeah.

Arvi:
I’m going to stick to that, because trust me, you do not want to hear me sing. So keeping it that for this episode.

Felipe:
I love it.

Ashley:
Well, thank you guys so much for joining us today, and we’re going to put a lot of this information in the show notes. We’ll add links. Maybe you guys can even give us a couple before and after pictures of some of your flips we can put in the show notes too. You can find out more information at biggerpockets.com/rookie19. And do you guys want to … Before we end this, can you tell everyone where to find some more information about you guys if they want to connect with you?

Arvi:
Yeah, absolutely. You can find me on Instagram. It’s @arvi.carkanji, and that’s C-A-R-K-A-N-J-I.

Dave:
You can find me on Instagram and Facebook, @dave. and my last name, A-R-L-A-U-D.

Ashley:
Well, thank you guys so much for joining us.

Felipe:
Getting dunked on my Felipe on Instagram.

Ashley:
Yeah. I’m Ashley @wealthfromrentals, and he’s Felipe at @felipemejiarei, and don’t forget to join our Facebook group. Search Real Estate Rookie and you’ll be able to find us.

Watch the Podcast Here

This Show Sponsored By

Zumper is an apartment listing site that monitors everything from rent prices to migration patterns. If you’re dealing with a vacancy, I want to encourage you to check out Zumper’s newest offering, Instarent. When you sign up for Instarent, you get everything you need to fill your vacancy up to 5 times faster. Plus, Instarent is backed by Zumper’s No-Vacancy Guarantee. Meaning, you’re guaranteed to find a qualified renter within 45 days.

Insta-rent is a $99 value, but for a limited time, your first listing is free when you sign at zumper.com/biggerpockets!

Mid-roll Sponsors

Policygenius will compare your home and auto policies across different insurers -and even mix and match to find you savings. They’ve saved their customers an average of $1,127 per year doing just that. If you own a home, re-shopping your home insurance rates with Policygenius could save you a good chunk of change. And the best part is, you barely need to lift a finger to do it .

So if you’d like to put a little cash back in your pocket right now, see how much you can save by re-shopping your home insurance rates at policygenius.com.

SimpliSafe was designed to be easy to use while protecting your whole home 24/7. Order online with the click of a button. Open the box, place the sensors, plug it in, and your home is protected around the clock. SimpliSafe was named “best overall home security of 2020” by U.S. and World Report.

Head to simplisafe.com/rookie and get free shipping and a 60 day money back guarantee.

In This Episode We Cover:

  • How Arvi and Dave wound up as real estate investors just a year out of college
  • How they work with contractors, step by step
  • Dave’s “25-25-50” payment plan for contractors
  • The different stages involved in renovating a house
  • Red flags to look for when inspecting work
  • Due diligence and permits
  • Transforming a single-family home into a duplex
  • Raising private money as a newbie
  • Renting staging furniture from companies like Rent-A-Center
  • And SO much more!

Links from the Show

Rookie Deal

  • Purchased from the MLS – $90,000
  • Renovations – $85,000
  • ARV (appraisal) – $240,000

Arvi & Dave’s MVPs

  • Arvi: Buffalo real estate agent, Cassandra
  • Dave’s mentor

Connect with Arvi & Dave:

Before and After Photos: