Nick Correll: Family Investor With A Heart To Help & Moving To A New State
LISTEN TO FULL EPISODE ON:
Hear from Nick Correll as he talks about getting into investing before he was a licensed agent. He talks about what it's like working with his family in his business and how he's balanced being an agent & and investor. Also hear how his investment business is giving him the freedom, due to passive income, so his family can follow their dreams and move his real estate business to a new state!
In this episode, hosted by Mike Swenson, we discussed:
- How his career got started and his background
- Got into real estate from investing
- Prides himself on being a good landlord, focusing on communicating and having value with tenants
- 23 rentals at his peak
- Does about 30-35 real estate transactions per year
- Sets up accounts and build relationships at different places to help get good pricing for his rental needs
- Is planning to move to Nashville
- Short term goal for Nashville is to get 2 rentals in the first 12 months and to add an additional revenue source
- Goal is to live off of passive income
- Determine what's going to set you apart from other landlords
- Wants to have good relationships with tenants
Timestamps: If You Want To Jump Ahead To Your Favorite Part
0:00 - Intro and overview on Nick’s career
11:15 - How he finds his rental properties
16:51 – How he builds his relationships to help with people leverage
23:12 – Future plans
29:51 – Tips for starting with rentals
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Nick's Facebook: https://www.facebook.com/nicholasgcorrell
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Full transcript here:
Mike Swenson
Hello, everybody, Mike Swenson here with REL freedom. And we've got a wonderful real freedom story for you here today. We've got Nick Correll with Remax. And he's going to share with you a little bit about his background, how he got into real estate. He has a lot of experience here with with flips and rentals. And he's got some new journeys ahead. And so we just want to welcome Nick and give him a chance to share more about his story. So welcome, Nick.
Nick Correll
Thanks Mike. Thanks for having me say I, I guess, the way I got into real estate was basically, on the investing side of things. It was about 10 years ago, now. My, my brother, my dad, and I decided that we wanted to do something business wise, weren't quite sure what that was going to look like, we had some other opportunities that just didn't quite work out. We were going to get into the restaurant business.
Nick Correll
But thankfully, you know, kind of, kind of, thankfully, it didn't work out, we decided to well, we saw that the housing market was pretty beat up a lot of good people out there still needed places to to live. And, you know, we just kind of thought about the the rental market and trying to get into that a little bit. We, you know, partnered with a good real estate agent, and they were able to help us, you know, kind of determine the, the right prices, and we kind of had a set number in our heads like what what made the most sense, price wise to get it for, you know, based on the, the current rent at the time.
Mike Swenson
Just to pop in for a second here, Nick. So this is you didn't have your license at the time, right? So you were in what what industry were you in before real estate,
Nick Correll
I was in the restaurant management business. So we, you know, we got our first place, it was a single family home. And we thought we were gonna flip it. We just, you know, a single family, we weren't quite sure what to do. We went in there, we were all three of us were working in there at the time, you know, there's our first one turn off wallpaper, turn out carpet, you know, doing all that type of stuff, update and stuff. And then we found a home and we could rent it for versus how much you paid for it and put it on the rental market and it was rented less than a week. Like, while I was pretty good. And then we let me see, then we we bought a townhouse kind of did the same thing.
Nick Correll
And immediately got rented like that sort of like okay, well, you know, there's a lot of people here that need a good place to rent. And we always kind of prided ourselves on making it a place where we would want to live. Like we didn't, we didn't kind of cheap out. I mean, we didn't go extravagant, but we did nice carpet, you know, we did, you know, nice paint and you know, if it needed appliances, or if it needed lights or stuff like that we're gonna, we're gonna put them in. So that's kind of one of the things that we always did in any time somebody moved out, we kind of did the same thing, you know, we assessed it, and we'd replace carpet probably a little bit sooner than some landlords might. And we always painted it fully.
Nick Correll
However, you know, we were able to build relationships throughout the the process that allowed us to do some of that stuff, you know, maybe a little bit more inexpensive than somebody else. It's like, okay, we're gonna have you do, you know, 10 houses of carpet, but you know, we're gonna want to a little bit better of a deal. So now we were able to kind of work some of those deals together. But so after about a year of working with an agent, and you know, kind of going that route, and I was, we were pregnant with our son at the time, our first kid, and I just decided that the rest of her life wasn't for me. I was working, you know, 60 plus hours a week, and it was nights and weekends. And it was just, you know, I wanted to get into real estate. He said, create your own hours, and you know, never work. Well. That's not the case is most, as most of y'all know.
Nick Correll
But anyway, so got my license, did my first deal, I was able to help us find a couple more properties. And kind of the rest was rest was history. So I mean, my main focus is real estate sales. So that's my main business. The rentals have kind of been a side thing. The first couple years, you know, when I was in real estate, though, they definitely did help out quite a bit, especially getting into them long winter months. You know, in Minnesota, that can tend to be a little bit slower for for some agents and especially when you're starting off that it definitely helped keep the income stream going so
Mike Swenson
So you would figure out so then Kind of typically, maybe in the winter, you would maybe spend a little bit more hands on time, with your rental type stuff where in the summer when things are busier, it's like, Okay have have other people do the work. And then maybe in the winter, you do a little bit more of the work yourself, or how did that. So
Nick Correll
Honestly, in the beginning, we did it all, we just, you know, we didn't have the extra funds, we just sweep, we did it all, and you know, kind of the last, you know, 567 years, we've been pretty much hiring it all out. All BSR our vacancy rate has been almost zero, since we've started. Oftentimes, we've had it re rented prior to the new people even moving out, so there's just a super quick transition of us painting or something like that, sometimes they'll they'll leave a tiny bit early, and we'll kind of give them an incentive to do that. So we can get ready. But we would always, we would always do everything we can to have our places not sit empty, because having it sit empty.
Nick Correll
You know, you're, you're not just paying your mortgage, you're paying, obviously, the taxes, but you're paying association fees, you're paying, you know, all of the utilities. So even if we, some of the tougher months to rent we found were like, kind of December just because the holidays and stuff in November. So if we had one come due, we would we would do it, instead of we would say, the month of December for 500 bucks, or 400 bucks, or, you know, 100 bucks, just to get somebody in there, we didn't have the cost, right? Get one and they were paying and then it was a year and so we would do things like that. And, you know, just being a, we kind of built our ourselves on being you know, a good landlord, meaning to us it meant, you know, communication with with our, our tenants.
Nick Correll
Number one and number two would be you know, if there's a, something that needed to be addressed, you know, an appliance or air conditioner, or something like that we were there, you know, by the next day, you know, emergency. So, that was one thing that we always tried to do, because you've always heard those stories, or, you know, I told my landlord, you know, five times, I've never fixed it. And so we never really had any of the issues that that you hear. Just because I think that, you know, some of the business practices we had allowed us to keep keep a lot of good people in place for a long time. And we have, we've had some people that have been five, six plus years, you know, kind of because of that.
Nick Correll
And with that, too, we've been able to keep our long term people a little bit under market rate just because we haven't had to, to do the whole going and tear outs and clean outs and stuff like that. So kind of a win win there. Yeah, it's kind of a, you know, if they're starting to look elsewhere, they're gonna realize that they have a pretty good deal. So they're not going to want to go, but then we're also like, Okay, if they did go, you know, we're gonna probably spend, you know, four or five grand, so let's just keep them where they're at here today. And so, yeah, yeah, that's how we got started. And we kind of jumped around a little bit
Mike Swenson
So just to give a frame of reference then so as you're as you're kind of thinking about, you know, how many how many units are we talking about, I know you'd mentioned you'd sold some so kind of walk us through the numbers there. And then in terms of maybe your your real estate sales, just give us a general idea of kind of where you're you usually plug along at.
Nick Correll
Sure. So we had as many as 23 rental properties at one time and I will say so, we did do three different different kind of rental opportunities. So we bought them as a rental with with the intention of the person that we were helping get into the rental to have them buy it and two of them ended up buying it one of them just didn't end up working out. So after they moved out, we fixed it up and ended up selling it. We we had 20 of them were were townhouses and then three where or single family we found even though they had an association fee it was it was simpler for us we didn't have to worry about you know any exterior maintenance, snow plowing grass, you know even though most the time it would be the person who lives their responsibility but just you know other maintenance you know roof and siding and exterior painting and you know, landscaping and those types of things that you're just naturally come with with an older home.
Nick Correll
So we find tunnel says were the easiest, and you know they were there or super super easy to rent. So and then yes, we've sold sold a few over the last few years you know the the market is been appreciating pretty quickly. Most of the the homes We've had doubled in price since we've owned them. And at the time, you know, we kind of make the decision, you know, we put, you know, a lot of time to put in new carpet and paint them and appliances, you know, we'll spend, you know, six, seven grand, it's like, Okay, do we just load someone and use that money for something different. So that's what we've been doing right now.
Nick Correll
I think we're down to only about seven or eight, but have some other opportunities that we'll talk about in a minute that I plan to do with some of it. But my real estate side of business, I've consistently known about, you know, 30 to 35 transactions a year, ever since about my second year, and, and I work with my my brother, he's a real estate agent as well, he does most of the most of the buy side stuff, I do most of the listing stuff, which has allowed me to kind of have the nights and weekends back and that family time and things like that. So that's kind of, you know, I guess most of how our business or my businesses is now.
Mike Swenson
So as you're, as you're thinking about, you know, value. And so first of all, so for those that don't know, you're in the Minneapolis St. Paul area. So how detailed Are you in terms of location? When you're selecting a property kind of walk me through that lens that you look at? How do you find out about these opportunities? Is that Is it a network? Are these properties on the MLS? are you targeting a certain area kind of walk through that phase of how are you looking? And what are you choosing?
Nick Correll
Okay, so yeah, so, you know, 10 years ago, up until probably, you know, even three, four years ago, you were able to pull up the MLS, and there was deals out there that you could buy a rental and turn a profit, it's getting tougher now, once you're willing to do, you know, quite a bit more work. But most of the stuff was was on the MLS that we did find. You know, we've since started flipping houses, I've done about 10 flips, most of those have come from from off market, and kind of word of mouth and kind of once you start doing one or two people notice it, and they say, Hey, I have this opportunity, are you interested? I've had that happen, for different times, and to have the same person.
Nick Correll
So it's really kind of Yeah, it's once you start it kind of like anything, once you're once you kind of start doing it, you kind of naturally attract that. And, you know, you talk about it in your conversations, people know that you're doing it. And it just kind of goes that way. You know, as far as the the rental side of things, there's still deals out there. And I would say probably even more now, so than even a year ago, because of where interest rates are, you know, is if you can look at, you know what the mortgage would be on it, if you have you know that enough for that 20 or 25% down or whatever your your lender may require, you know, typically, you're going to, you're still going to come ahead.
Nick Correll
And in my opinion, if they're covering your mortgage, even if you're making 100 or 200 bucks, you know, a month, you got to look at, you know, the the appreciation of the home to I mean, plus paying down your mortgage. So there's plus you have the the tax benefits of the other the write offs, and the depreciation and stuff like that. So there's really four things to look at, you're not just making 100 bucks or 200 bucks a month, you're really making, you know, money that you can't see. But that's there.
Mike Swenson
I was actually listening to another agent was talking about how you know, as an example, if you looked at, you know, let's just say $100,000 property, just for the sake of a clean number, you know, you could pay in cash, if you had the cash, first of all, to just buy the $100,000 property. But if instead, if you put 25% down, leverage the other 75%. Now you could buy four properties. And he just kind of ran the math on you know, fast forward 10 years, 15 years, if you did just the one, great, you've got a better cash flow, but the appreciation, it's only one property.
Mike Swenson
And then you look at that multiplied by four, that's the value of leverage, right? And so so especially with mortgage rates, as good as they are now, it makes sense to do that, because that's, you know, quote, unquote, free money. In the sense of five years down the road. It's not like you have a lot of interest expense and the power of the appreciation, the power of the tax deductions, the power of them paying off for mortgages versus one like that leverage. Really grows. And so that that makes a lot of sense to take advantage of that money. That's why, you know, banks are there to help leverage that for you.
Nick Correll
Right? Right. And, you know, over the kind of the course of, of doing these and doing the flips, we've kind of, you know, been able to kind of put our money just into the next one, and the next one, and the next one. You know, right now I am closing on a house and on Friday that, I'm free and clear, just because of how many times we've done it. And, you know, the smarter thing may have been to, to, to, you know, borrow against that, but you know, when you're doing a short term flip, it doesn't make as much sense because you have fees and stuff like that. So if you're going to be holding it, you know, for less than a year, and if you have the ability to just pay for it, you know, that's probably the right way to do it.
Nick Correll
But if you're gonna hold it for longer, you know, it's definitely not so and then just kind of sidetracking to I found out that my financial advisor that we have a program, I guess, that we're I could put that money into, in, you know, in a stock market, and it's appreciating or whatever it's doing, but I can borrow 100% against that. At a super low interest rate, it's just kind of a line of credit. So that's probably what I'll do for future for future stuff. So it's in there, and it's making money, but I can borrow against it in animal interest rates. And he said, even if you don't pay it back, because there's evidence pretty much pay the loan itself. So it's kind of a cool program and something to look into if you know, if you have that opportunity. Or if you have a financial advisor and have a lump of cash, you can put it in there.
Mike Swenson
So how did you because you've mentioned now you, you know, you hire out most of the work? Are these just relationships that you built as a part of being an agent? Or, you know, I know that stuff kind of just naturally happens over time. But how did you build those relationships with all those people to help provide that, that people leverage for you?
Nick Correll
Yeah, so, you know, we, you know, one of the one of the persons actually was doing a project on one of our personal homes, and was working for a company that he was kind of unhappy with, and he started kind of going off on his own. And then we just started hiring him for all of our stuff, and you know, some of our personal stuff, and we use them for some of our flips. And then we have a carpet guy who, you know, we've kind of paired ourself with will basically kind of just we have an account, we just go in and pay for the carpet, and we just pay him to install it, you know, it's a win win. You know, it's consistent for them. And you know, it's repeat business for them. So they're willing to do some of that type of stuff. We just have other accounts set up. Like even as simple as like we have a contractor card.
Nick Correll
With we're not it's, it doesn't have as many perks as it used to have Eastville to get free delivery over a certain amount, but you still get some other things with it. So So those types of things, we set up an account at day appliance, just simple things like that. Whereas when an imbiah, like, if you're going to buy like a circuit board for a furnace, I mean, it's probably going to be 200 250 bucks, and we can go in there and probably buy it for less than half that or, you know, or apart for a fridge or, you know, numerous appliances. I mean, I can probably fix just about any appliance out there. Because in the early years, you know, we'd be the ones out there fixing stuff. So taking them apart and troubleshooting them and stuff like that.
Nick Correll
So little things like that. And if you do have somebody go out there, I would always try to be there, you know, just to learn, you know, what are they? How are they fixing it, you know, one of the kind of troubleshooting things are they going through. Same with our co author hv AC stuff, you know, the last couple years was about the year most of our town houses were built in the early to mid 2000s, you know, they were starting to be, you know, 1015 years old, you know, kind of right at the time our stuff is starting to go some places, we've replaced them all, but you know, we have that one guy that we keep going to so we get a kind of a better rate. So yeah, that's kind of one of the things we set up front with people like hey, you know, we're going to probably continue to use you, you know, what can you do?
Nick Correll
What can you do for us, trying to make it as much of a win win as possible, see one of the carpet cleaner, you know, things like that, because anytime that we would transition, you know, if the carpet didn't need to be replaced, that was kind of part of our thing that we needed to have the carpets cleaned. And then we built a relationship with with the home cleaner as well. We gave our people the option, hey, you can claim property or will hire it out and it's gonna be XML. So things like that. Yeah, I guess that's kind of it. Well, we did we just, you know, consistently use the people. And if if somebody wasn't quite up to our standard, you know, we'll find somebody new or kind of word of mouth, a lot of the people that are in the business to know other people, so that kind of helped generate some of those, you know, additional people that we would use and things like that.
Mike Swenson
Now, you'd mentioned obviously, with these rentals, you're working with family, and you know, you're, you're an agent, now, with your brother, talk a little bit about that dynamic, you know, how has that been, I'm sure there's been periods, you know, where, you know, you go through different phases of life, but how has that been working with with family on that?
Nick Correll
It can be difficult, sometimes the rental side of things wasn't as difficult, we kind of defined our roles in the beginning, to get a property ready, we would all kind of be there getting it ready prior to us, you know, hiring most of the stuff out. But my role would have was always kind of the leasing, you know, the checking people in checking people out, kind of that first line of, you know, phone calls and stuff like that, my brother would take all the maintenance requests. So anytime somebody had an issue, he would either try to settle there, first, try to troubleshoot it, and then try to you know, get it taken care of, and get it fixed.
Nick Correll
And then my, my dad was kind of the kind of the back office guy, you know, kept track of everything, you know, all the checks coming in, and all the association payments and stuff like that. So that's kind of how we divided it there. And then the real estate side of things, you know, I got my license first, I kind of paved the way and you know, started with the, with the database and stuff like that. That's been a little bit more challenging. Now, however, we've kind of like I said, He's kind of does more of the, the buyer type stuff and some of the other stuff that allows me to have a little bit more freedom. So I've kind of looked at it as kind of a win win there. But I'll be honest, it's not, it's not easy all the time. It's a little bit more difficult to hold family members accountable than it is, you know, somebody that might just work for you.
Mike Swenson
Yeah and to I mean, just if you if you think about you guys have been doing this for so long, like, life happens to like you said, you know, before you had kids versus now you've got kids, like, life just changes. And so, you know, priorities change, time, availability changes, you know, you guys are, you know, going off and on vacations or stuff. And so things still need to happen. So it's just, she's juggling schedules and different things like that. So it absolutely is, is adds another wrinkle.
Mike Swenson
And yet to there's there's a wrinkle of leverage there to where if it was just you, you were just by yourself, you have to figure everything out for yourself. So there's a there's a balance there. Right, right. Yep. For sure. Cool. So so then as you think about your, your future, so outside of, well, maybe we can talk about this. So you've got some exciting things in the works here. Talk about your next phase of life in real estate, and what's that, what what that's going to look like?
Nick Correll
So my wife and I have made the decision that we plan to relocate to the suburbs of Nashville, kind of southern suburbs, kind of like the Franklin area, college Grove. So with that being said, I'm pretty much going to be starting over, I don't know anybody down there other than the people that I've met the two times that we went there in the last month, just to kind of determine the area that we wanted to be. So I do have a I do have a real estate coach who will help me with that transition, you know, kind of helped me hold me accountable. But I will be starting over, I've already started to try to join some investing groups down there. I would like to, you know, I would like to try to get a rental as quickly as possible.
Nick Correll
When I'm down there. I'd like to have, you know, a couple within the first, you know, 12 months is that's my goal. And then possibly, you know, depending on how things are looking, especially with you know, pandemic and everything going on, it's a pretty big tourist town. So some possibly some Airbnb, something like that. But right now I'm focusing mostly on the the rentals, probably single family. I'm definitely looking into kind of more of a multifamily units out there, small building of four or eight or 16. That's kind of going to be my I think my next thing that I'm going to start looking for, just because, you know, we're all in one location when you can have something to kind of manage it and it's, you know, from that from that dynamic mimikatz, you know, could be a little bit easier, but I guess I guess we'll see.
Nick Correll
So right now I'm kind of starting to build relationships as much as I can join in any groups that I know that are that are down there. And I'm in the process of getting my license for down there. So I can have that for for when I'm there. And then I'll, like I said, I'll be starting over, I'll probably be doing a lot of nights and weekends, my first you know, 12 to 24 months, when I'm down there and ready for it, that's totally fine with me, you know, we're making a big change.
Mike Swenson
Will you just take the time that you used to be shoveling snow and chipping ice off the road? Now, that's, time that you got back to be go spend in your real estate business.
Nick Correll
We are transitioning to us already. Now I live on a couple of acres and stuff like that, there's a lot of, you know, stuff to take care of here, and it's going to be a little bit different format, we're going to be in a in an association that has a lot of the same stuff we have, but you know, not as quite a big, big. So that's Yeah, that's what that's what's in store and then keep doing what we're doing.
Nick Correll
And what we've done for the past 10 years has allowed me to be able to do this, right, for me to be able to go there, you know, not knowing where my next paycheck is gonna come from? And I'll be, I'll be okay. You know what I mean? Just because I'll have stole a little bit of income from, you know, from from the rentals we still have up here. But also I will have, you know, the what, what we've kind of created over the past 10 years, and so have some leverage and flexibility.
Mike Swenson
What's going to happen with your real estate business here? Have you figured that out? Are you still thinking through that?
Nick Correll
I'm currently, that's one of the things that I'm figuring out, I will continue to hold my license here for for some time. I don't know how, you know what that's ultimately going to look like. But I will probably have, you know, a primary or maybe a couple, we've seen a specific referral partners up here that, right, because I also have clients, you know, that'll be in touch with and talking with them. No, no, no. You know, who I who I trust and who, you know, who they should use neck. So I would, you know, that's my plan anyway.
Mike Swenson
Well, the nice thing is, I mean, as that is the nice thing about having your licenses, you know that that referral business can be a nice chunk, right? Like you've, you've built these relationships over the past 10 years or so, you've got people that know, like, and trust you that really want to use you. And now you can just say, hey, fantastic. Here's another agent that I I know, like and trust, and now you get a referral off of that. And so it's another little littler stream of income. And in some ways, like you don't have to do anything with that, right? It's just, here's this person I trust, and now you get paid for that. So in some ways you can help to keep the keep the lights on a little bit with some of that referral income, and how do you build down in Nashville?
Nick Correll
Yeah, that is that is my short term list, or my short term goal is a short term goal. And, and, you know, I'm thinking, you know, my short, my short term goal is going to be, you know, to get, you know, two rentals within 12 months, and then my next goal is going to be, I want to have two additional sources of income, you know, one of them being the rentals, you know, one of them being my real estate, and then a third one, I'm, I'm still in the defining process of what that's gonna look like, currently, but as of next year, all of our kids will be will be in school, so our youngest will be in kindergarten, so that allows my wife to probably do something, you know, in the real estate world where we're kind of determining how that's going to look, but so yeah, yeah, she's the one that's, she's the big relationship builder, she'll join a club and, you know, be the president by the next year. So I'm kind of excited, excited for that. We'll see what happens.
Mike Swenson
So then as you guys think, long term, then you know, what, what's in store for you kind of what are those bigger goals out there? Where as you think about either financial freedom or time freedom, or both, kind of what is the next 10, 20 years look like for you? What are the things that you're focusing and honing in on?
Nick Correll
Yeah, so, you know, over the next 10 years, I would like to be able to live off of mostly passive income, that would be you know, either a referral business that would be, you know, rental income, or that would be, you know, owning a team, but kind of, you know, stepping back here and having the listing side having a buyer side and, you know, probably a manager or some sort. I mean, that's kind of where we're, you know, the next 10-ish plus years I'm, you know, going to be focusing on so.
Mike Swenson
Yeah, cool. Well, maybe, maybe kind of thinking about advice. So if you go back and you think because for so many people, you know, if you're in the real estate business, if you're an agent People always just like I always talk about everybody's thought about being in real estate. Most people in real estate have thought about doing rentals. So what would be kind of some of the tips and advice you'd give for people who are looking to start rentals or to leap into it bigger than they have before?
Nick Correll
Yeah. Bigger than you had before you, like you say, we wish we would have done, done more. So I would say your first one is going to be the, the pain of doing it is, is more than than actually doing it. So what I say what I mean is, you know, the fear of the unknown, the you know, isn't going to work, you know, is the finding the deal. Once you have that, you'll be like, I should have done this a long time ago, type of thing. So I guess, if it's something you want to do, actively pursue it, you know, find the right deal, make it makes sense on paper, don't just think well, it, hopefully it'll make sense, you know, but we, you know, use, you know, use, you know, Craigslist or Facebook marketplace, or, you know, Zillow rentals to determine you know, what, what you think the average rent would be, and then just kind of work it backwards and make sure it makes sense, talk to an accountant, make sure that you have, you know, you understand how the depreciation and everything works.
Nick Correll
As an agent, you should be set up, in my opinion, as a corporation or an LLC. But more importantly, when you have your rental to do the income through there to for, for, you know, for tax purposes, and liability reasons, and things like that. So, I'm not an accountant, start building those relationships. And let's see, just, you know, determine what, what's going to maybe set you apart from from other landlords, like our thing was the the giving our, our people you know, value and communication and, you know, wanting to be there, you don't want to be somewhere where they're, they're looking to get out after the 12 months, you know, what I mean, it's gonna cost you more, and have that built into, you know, whether it's, you know, whether you think your average person is going to be there, you know, two years or four years and you know, a clean out and then you know, painting and you know, potential carpet, you don't have that kind of built in have appliance budget built in.
Nick Correll
So, you know, you're making these 100 200 300 bucks a month, you know, make sure you're putting some of that away, or, you know, some of the appliance stuff, you could have like a home service plus or warranty type service, that would be definitely helpful, especially if the home is, you know, older than 10 years. So that's definitely some of the some of the recommendations. We didn't touch too much on on some of the flips that we've done. Yeah, leaning into that a little bit more, a little bit. So what I will say, say, for those, the first one we did was an education we didn't, we made money, but it wasn't worth it. But it was worth it just for the fact of how much we learned, and how much, you know, knowledge we gained, you know, some of the relationships rebuilt, what to do, what not to do, what made sense? What didn't make sense.
Mike Swenson
That's one of the things, Nick, that is, as I talked to more people, and I think about this, you know, the the people that are afraid to start, even if you were to think of it from this perspective of I'm going to run the numbers, here's what my projected profit is, let's say something does go bad. and at worst I breakeven, or even worse yet, let's say you did lose a little bit of money, the value of what you learned through that is going to more than pay off in the future. You know, I know there's a business leader that I like to follow. And he lost, I think it was like $100 million. And he talks about that was his education, right? So even if you lost some money off of it, the value of the of the learning that you had, now, you're not going to go into a rental and say, well, the numbers don't make sense.
Mike Swenson
I'm going to learn about it, you know, you're still going to do that. But know that that buffer is there, where worst case scenario, if you didn't break, even you gain knowledge. If you did happen to lose a little bit of money, you just gain more knowledge for the future versus people feeling like I have to net this or I'm not going to jump in there is the educational value of getting started, would you would you agree with that?
Nick Correll
I would definitely agree with that. But I'm also I've always been a very, very hands on DIY kind of guy too. So that it didn't scare me quite as much. I did a lot of this stuff early on. You know, the first house we did we did most of the work. In the last couple of houses. We did we didn't do most of the work. We were there for all the decisions, you know, we helped with demo, we help the some stuff. We did most of the shopping and picking out stuff. But beyond that it was we had, you know, up to four to five guys that would, you know, be there almost every day and get this stuff done for us. So, but yeah, the first one is definitely a learning experience. They got a little bit easier as we went along, I mean, you were able to project the numbers a little bit better to, to avoid some of the, you know, just kind of guessing a little bit when you're in, you know, when you're going through how much is a kitchen, how much is a bathroom, make sure you project all your holding costs, too.
Nick Correll
That's something that we kind of didn't do in the beginning, we didn't really truly realize how much that was actually going to be, you know, and then the property taxes and when those are coming due and and, you know, determine, you know, where that money is going to come from, if you're, you know, borrowing for the fixes on top of the property, you know, you have that interest expense, too. So I always after the first one just kind of erred on the side of caution. That was gonna take, you know, three months, I would budget for double that, because you know, there's the sell time too. And there's other things that you got to take into account.
Nick Correll
And then you've seen it use watch, the show is whatever, you always go over budget, you just do. Tiny, you start doing like, Oh, this looks so good. Oh, maybe we should just do that, too. And it's like, this kind of a snowball effect. I will say, you know, another thing too, is if you can remove yourself, if you're like, Okay, I'm not doing this for me, I'm doing this for somebody that's coming in here, you know, it helps you maybe not spend as much. I mean, you really got to look at two things kind of side by side, does this really make sense isn't really gonna do anything, but we always did a very, very nice product. Because, you know, we've, we've kind of flipped as agents are like, really? Did you know, did they do that?
Nick Correll
So, like, with our rentals, we wanted to make a nice product. And I think that helped command us, you know, in our later flips to get, you know, top of market and we prove that every single time we did it, we got top of market in the area. So yeah, I mean, that's kind of some of the, I guess, some of the advice that I would have for flipping and stuff like that. And so Oh, and I was, so every time on my soul, my equation sheet, I would always i'd figure worst case scenario, which kind of like what I do with, when I sit down with a seller. I don't like to have any surprises in the end. So I always figure out, you know, US paying or contributing all closing costs us, you know, for, you know, any repairs, that type of stuff. So I try to do a worst case scenario, and then budget, my numbers from there. And anything that we negotiate or do differently is just kind of on top.
Mike Swenson
Yep, yep and I love your mindset around, you know, in terms of rentals, too, that you're, you're helping people, because I think that's the, you know, a lot of people get into real estate, obviously, they get into real estate for the money, the flexibility and that kind of stuff, but people like to help people. And and I think about, you know, what you were saying about, you know, being a responsible landlord, showing up the next day, if they have a concern, like, that's a big deal. You know, I think about some of the rentals that I've had, or some of the renters I've had over time. You know, one, one person it was, they were looking to move out of state in a year, and they wanted a place to stay. That was actually the thing that got me over the hump for my first rental was knowing I had them, and I had them committed for a year.
Mike Swenson
It's like, okay, we can be okay, well then that snowballed. You know, the next person, they were getting married in a year, so they needed this spot to move to be able to then get set up for their wedding for the following year, then we had a couple that was going through college, and so they needed a spot. So it's like you're helping people, I had another person who was coming out of a bad rental situation. So I said, here's my chance to show up and be a responsible landlord, for them, they rented for a year, then they were able to go buy their own house, right. So you're able to have these cool stories of how you can help people as a, as a landlord and do it in a way that's, that's honorable and respectful. And, and, and they really enjoy having you versus some other person that gives landlords a bad reputation.
Nick Correll
And I will say to me, if you have a good relationship with with them, you know, especially if you're a real estate agent, as well, I mean, you can you can market to them, hey, when the time is right, you know, I'd love to help you, you know, get into a home. That's one thing I wish we would have done better early on, he just kind of naturally segwayed into that with a handful of them, but have done a better job of that because some of our long term people, you know, ended up buying houses or whatever. And yeah, I mean, it's naturally gonna be the ones that have you know, family or friends or whatever. But that's one of the things we could have done a little bit better job in. And then when you do have those, you know, makes that that burden of them moving out a little bit easier, because, you know, you're going to be helping them get into home and also, you know, making money on the other side of it.
Mike Swenson
And you would be more likely to be flexible. if let's say you had a 12 month lease, they want to move out month 10 Hey, you know, we're thinking about moving out, well, hey, if I can help you with the house, let's go shopping together. Now. They're ready to buy you don't you're not as upset about losing out on two months rent because they're helping you know.
Nick Correll
Or on the other side of things, you know, Hey, where are our leases due in April and most the time you either got to make a decision, you know, sign another year or figure something out. But if you want to buy a home, hey, I can be give you the sweetheart deal. Yeah, take two months, three months, whatever to you know, you're still getting an income. I still know when you're moving out, you know, because realistically, you only need to market a home for for rental for not a very long time
Mike Swenson
Yeah, that makes sense. And let's just say, you know, ballpark rough numbers, you've got 10 rentals, let's say half of them go on to buy a house later in life, and use you Well, that's, that's five a year, if you're clipping along it, you know, 30 transactions, if you had five people that were going to be coming due here to go buy a house, you could help with that 16% of your business each year. And let's say you help them for two or three houses in the future, if you do a great job, and you you know, stay in touch with them and build relationships.
Mike Swenson
That's the thing that I people just don't realize in real estate is all the ways that you can line up a domino rung here, you know, I acquire a rental, I have a renter, that person can become a future client for 234 houses, they could have referrals for a couple of their friends and relatives to like, that stuff just lines up in a way that benefits you when you're when you do a good job for them and help them
Nick Correll
I should go back and look at it. But it's probably been at least 1520 transactions I can attribute, you know, to to our renters. And you know, some of them, like you said, helped him get in his first house. And a couple years later, you know, three, four years later, they'd sold and bought again, and yeah, definitely. I mean, we've we've had a number of those
Mike Swenson
Cool. Well, anything else you want to add here? I should mention? So how should folks get in touch with you? I know you're going to be moving here but is there some way anything that you want to plug anything that you want, folks if they watch this now or in the future? How they could reach out with you?
Nick Correll
Yeah, so you know if anybody has any, you know, any questions about rentals or anything like that you're more than welcome or less, you're more than welcome to to give me a call , or shoot me an email or something like that. You can find me on Facebook, it's just Nick Correl. My phone number I don't think I'm going to be changing 76367046 to one and then my my email that I'll have forever. I work on changes every now and again. But my personal one does and it's [email protected] so Instagram, whatever, so find me on there.
Mike Swenson
Cool. And if you're listening to this, and if you're in the Nashville area, now we're in the future. Nick's common, he'd love to network with you and would love to establish any relationships to get some rentals and to get some real estate business going. So absolutely. Cool. Well, thanks so much for coming on. We really appreciate you sharing your story and thanks so much.
