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Download this Episode Video marketing is a common discussion among real estate agents right now. Today we discuss some of the things to avoid during when video marketing listings in real estate. reThink Real Estate Podcast Transcription Audio length 23:49 RTRE 62 – Video Marketing in Real Estate [music] [Chris] Welcome to re:Think Real Estate, your educational and hopefully entertaining source for all things real estate, business, news and tech.  [Christian]: I am Christian Harris in Seattle, Washington. [Nathan]: Hi, I am Nathan White in Columbus, Ohio. [Chris]: And I am Chris Lazarus in Atlanta, Georgia. Thanks for tuning in.  [music] [Chris]: Hey everybody and welcome back to re:Think Real Estate. I'm Chris here with Christian and Nate. And today we're talking about…Nate what are we talking about?  [Nathan]: What are we talking about? Listing videos and… [Chris]: Listing videos. We're talking about listing videos today.  [Nathan]: We're gonna be talking about listing videos. What's great about this episode, I think is, I'm not gonna be talking a lot, because I don't do listing videos. So that's…that's great. But Mr. Harris here is…is really…God he…what's the proper…he got a wild hair posses on this one. It was brought up I guess. [laughter] [Christian]: Oh boy.  [Nathan]: He has got has got some strong opinions people. About these listing videos and so I mean… I guess I have opinions. It's you don't need to do them. But I guess if you're gonna do them we're gonna let Christian talk about what you should do and shouldn't do. As we always talk about I guess on our podcast. I'm actually intrigued to hear what he's got to say. Because maybe I'll learn something since it's not something I ever venture into. So Christian you want to talk about listing videos and…and how they're done. Right. or how they're done wrong? Or maybe it's about content but you got some strong opinions. But what got this wild hair up, you know, to be so “eick” about it? [laughter] [Christian]: I don't know how much of a wild hair. But, I mean, Nate so what do you do to market your listings? Because that's when I say listing videos, I'm using it as a general term the agents use to market their listings. [Christian]: Well I tell all my clients up front too that if somebody comes in here and tells you they're gonna market their home, well I'm gonna tell them “Dude that's a [censored] word generally.” In our market, again we talked about this in the last two episodes, when I say our market here. You know what you have to do for marketing in Columbus? Put in MLS. It hits Trulia, Zillow, Redfin, boom boom boom boom boom. Right. great pictures I think are a giant, enormous and key. I don't see the need for video and unless it's depending on the caliber of the home. Right. I could…could do it. And then I'll segue. I think a lot of it depends on what you're also charging the client. Right. But…marketing…you put it in…put it in MLS.. Right. now that's about all you need to do. I mean… [Christian]: OK so let me let me ask you so what…so if you believe that all agents marketing is automatic, what value are you bringing your clients? What do you actually do for your clients that other agents don't do? [Nathan]: Boom. I'm better at negotiating then I think about 90% of the people out there. I guide them through the process of preparation getting their home prepared to put it on the market. What may need to be done or not need to be done to that home. Right.  [Christian]: So how's that presented if you're not doing a marketing? And you're doing photos. Right. But everybody does photos. [Nathan]: But yeah everybody does photos. But again everybody does photos, b ut there's a difference in the quality of photos. Right. you got plenty of agents to walk in with their own camera or their iPhone and take photos, yeah. Right.  [Chris]: Stay away from the Galaxy you all. Just… [Nathan]: Yeah right. Or you have an agency and a professional photographer to photograph a home. Right.  [Chris]: Which standard should be standard.  [Nathan]: Should be but I would… [Christian]: They can't…[crosstalk] [Nathan]: 50% of agents in the Columbus market do not use professional photography.  [Chris]: And Christian yes a photographer should be standard even on a vacant house. [Christian]: Oh no it should be. That was a little throwback to our last episode about the value of staging, you know. Yep professional photos help a house.  [Chris]: Photographer yes. Stager maybe not. [Christian]: Right. [Nathan]: And again I think it depends. Now what I do, I offer three options when I go on a listing presentation. You have a four percent of five percent and a six percent. Right. And they all vary with what you get for that amount of commission. Some people don't want to spend six percent. Most people go towards a five. But… [Christian]: So you give them options? [Nathan]: I give them options yes. And a lot of people like… [Chris]: It's a menu. [Nathan]: Yeah it's a menu. Right. It's no more. But I personally don't believe video sells a house. Why? Didn't [censored] sell a house 10 years ago. Why? Because they weren't doing it. And things sold just fine. So… [Christian]: Well I mean that's…I mean it's a, you know, you know, you don't want to get into that topic because there wasn't an internet ten years ago. And things have changed so… [Nathan]: Right. So… [Christian]: You know what that last brokerage said? “This is that we've done for 40 years, I'm not going to change it now.” [Nathan]: Famous last words. [Christian]: I don't think that's what you're saying. I hope not.  [Nathan]: No. But like so you say, well “What do you provide?” Well I also offer…I hate the word [censored] “discounted” but I will list your home and provide what generally is the same as any other agent, I just do it as a better rate. So but go back to your videos. [Christian]: OK OK. I wasn't…that was intended as a joke. As just kind of… [Nathan]: No it's OK.  [Christian]: I wanted to hear what you thought was the value you provide.  [Nathan]: Here is the other thing I provide. I provide them [censored] honesty because most real estate agents are [censored] liars. They won't tell the truth. They'll say anything to get the [censored] listing. I don't know if I talked about it. Let me rant on this one. I just went, did a listing presentation, like three weeks ago. I don't think I've talked about this. Right.Bbut the client walked me upstairs and I walked in the room and I went “Oh my God that [censored] wallpaper has got to go.” [Christian]: Yep you mentioned that in the... [Nathan]: Right. [Chris]: Yeah that's a good one.  [Nathan]: Right. So yes she laughed. Right. And I said what's so funny Jenny? She says “All the other agents came in here, just told me the room look beautiful. You're the first one to tell me it's ugly and I know it's ugly.” Most people just don't tell the truth. [Chris]: Was that the dentist? [Nathan]: Yes. [Chris]: Yeah I remember that one.  [Nathan]: What? What…what do you get? Right. You get pure honesty. You don't like it? Than don't [censored] hire me. Enough about that. [laughter] Let's go back to…we were talking about videos. How do we get back to videos? This all started with videos. [Chris]: Back to listing videos. [Christian]: Right.  [Chris]: Bring it in.  [Christian]: We've believed at this point a little bit. Nat's value is not in the marketing. And I'd say most agents' value is in the market, because honestly it is pretty automatic, it's pretty syndicated these days. And it's something, you know, I tell my…my clients too. It's like “Listen this is what an agent is gonna tell you. This is [censored]. This is, you know, this is…this is how it works.” I think my axe to grind when it comes to listing videos is that what most agents call listening videos are glorified slideshows. Stop calling it virtual tour or a listing video. [Chris]: Yeah we're…we're gonna give you a virtual tour. [Christian]: A moving-picture is not a video with some you know, generic music over. That's, you know, pet peeve of mine. I don't know why people still pay for that, you know, because I'll look on the MLS we have that virtual tour link. Right. Half the time I click on it some, you know, [censored] tour factory slideshow, with some crappy music go over. I'm like “What the [censored] is this?  [Chris]: Like yeah for us its property panorama but it's the same thing. Takes all your listing videos, automatically adds the background music and there you go. I've turned mine off in the MLS. [Christian]: Yeah so that bugs me. So to me I think when it comes to marketing there's two main things you can…you can do. And maybe three. I mean you could do a dedicated, you know, listing website. Which I think could be helpful, especially if you're seller is gonna share it, you know, as opposed to sharing like the MLS link or something, which looks, at least for us, looks archaic and cheesy. So having a dedicated landing page can be a helpful tool. Something like Kingston Lane. Really cheap. They do a good job. Or doing like a Matter Ports [phonetics] for 3d tour. I still think that is really powerful as a way for people to do a walk-through without actually being there. So they get a good feel for the house which you… [Chris]: Matter Ports is good. [Christian]: Yeah so we use that on all our listings. If you're gonna do video, I think you can either detract or enhance the house, to pay on how well it's done. So I say for most agents is probably not what you want to do. One, it tends to be expensive if you do it right, because you're gonna hire it out. If you do it yourself…you…you better be pretty damn good, you know. The reason I go with Matter Ports instead of videos, is because it allows the end user to control the experience. They get…it goes as fast as they want. They get to look at what they want. They're not stuck with “Oh it's a 30 second video and I didn't get to see what I wanted in the house.” Or “It's a 5 minute or 10 minute video and oh my God why is there five minutes of drone footage outside, before you get inside the house. I'm done.” They click off. So the problem with video is that nowadays people want it quick. They want to see what they want to see. And so it can really shoot you in the foot if you're not…if it's not done well and it's not done timely, it doesn't have a specific point. But I do still think there's definitely room for it. And…and there's some great people out there doing some…some really cool stuff.  Like I don't know if you guys saw the listing video for Ryan Lewis's house out here in Seattle. It's, you know, thirty million dollars or some crazy mansion. And they basically hired a influencer to do a twenty minutes basically like a roast of his house, under the guise of he's breaking and entering into Ryan Lewis's house. It is as they're making fun of it the whole…whole time through. And it's hilarious. It doesn't really good job to showcase the house. In like a normal listing video I won't last three seconds, and this thing, you know, watched all twenty minutes of it. Because it was funny. It was memorable. It's an amazing house, you know, then, you know, some more grassroots people, they're doing some amazing stuff with. Like Tim Macy, you know, our common Cameron, which we've had both them. [Chris]: Yeah they've both been on the podcast. [Christian]: Yeah but, you know, the RETV Facebook group is great for kind of forward-thinking, video focused content makers. [Chris]: Erica Wolf just did a new tour of a home.  [Christian]: Right. Yeah…yeah that was pretty…pretty funny.  [Chris]: See those are the things that the MLS won't allow as like listing videos though. Because with an MLS, at least in Georgia, for our listing tours it has to only be the property. So you can use Matterport or could do a video walkthrough, you can't do anything creative on the MLS board. So that's…that's outside of our listing video territory. That's social media marketing. That's promotion… [Christian]: This is if you want to stand out and actually provide something, not just as your own brand, but like if…if your clients want to be aligned with that outside-the-box viral video stuff, you know, I mean…I know like Phil Greeley, locally, he's a Sotheby's and he's just double down on video. And he's gotten some really high-end listings because he's done some…yeah from like doing some amazing videos. That get some great traction, you know. Like that he wouldn't have got that if he just did photos. [Chris]: [inaudible] with Gary Vaynerchuk [phonetics]. [Christian]: Yeah I'm just saying… [Chris]: And he was one of our first guests.  [Christian]: Yes. But I'm just saying it's not like it's worthless. [Chris]: No. [Christian]: But if you're gonna do it, do it right. [Nathan]: Some people do like…what's his name, The wolf of Whistler. [Chris]: Wolf of Whistler?! [Nathan]: Oh tell me you've seen it. [Chris]: Oh I know what you're talking about. Yeah.  [Nathan]: Well I mean his is good. I mean, you know, it's very much like a dollar shape for housing. But it was…I mean it's catchy, it's good, it gets people's attention. [Chris]: So let's talk about quality of listing videos. Because Christiane you kind of got into it and I did a lot of Matter Port. I think Matterport is good spending the money when it's not a seller's market. When…when you don't have to worry about, you know, the property being on the market more than 24 hours. [Christian]: I just do it in all my listings. But I own the camera. [Chris]: So out of Christian… [Christian]: I am just saying it's, you know, it's part of what we offer.  [Chris]: OK. I'm glad, you know, like staging is part of all your listings. I'm sure there's exceptions. [Christian]: If it makes sense. If it makes sense. [Chris]: Yeah yeah it's part of all my listings. So Matterport I've done. And…and I found that the Matterport increased the quality of the showings. Because by the time the people are coming out there, they've seen the property, over and over again. They've already walked the property over and over again. It's decrease the number of showings before contract. And then during the contract period its decrease the number of walk throughs. Why? Because we've already got a diagram that has every measurement of the home that's listed and it's online.  So we've got the entire floor plan of every floor of the house, that Matterport comes with. In addition to that they can continue to walk and do whatever they want. They can be screen shots and save the images. Whatever they need to do at night, in bed, kids are asleep. Whatever it is. Husband and wife. Whoever is buying the house can look at the property together or by themselves and just figure out where their furniture is gonna go, without coming back out to the house while it's under contract. So it's dramatically decreased the number of showings, but it's also decreased the number of times the buyer has to come to the house. In substantially sized homes.  Video. 100% has to be quality. I have fired video or content companies, for photo, Matterport, video. They do it all. I fired them because when I saw the video that they turned out, I can see the footprints in the video going up and down as the photographer's walking through the freaking house. And it just drove me nuts because it's like giving me motion sickness. And I know that my eye is better for that than like most of the public. And hardly anybody's gonna notice. But I notice. That's my brand. So that [censored], not acceptable. It's hard to find a good photographer. Somebody that can do video. Because they've got to have  the equipment. They've got to have the stabilizer. They've got to make it so like they're walking through. They're not like… [Christian]: If you're paying for it they better at least have a gimbal. So you…it doesn't look like they're walking, you know, bouncing walking through the house. I mean it's a basic. You could buy one of those for 80 bucks yourself, you know.  [Chris]: Well if you're using it for an iPhone. But for a camera it's not 80 bucks.  [Christian]: Yeah I mean they're more expensive. But my point is, you know, if you're like that's what you do, you better had the equipment for it. [Chris]: Yeah absolutely. So I've got a great photographer in Georgia. His name is Keith Hirsch, Georgia home view. Best photographer in the state in my book. I've had a lot of people come across my desk and Keith is the only one that I've looked at and I've said “You know what? I can't do this. That's like…that's way above like my…my level.” And I've been in a darkroom since I was 14. So I've been around a camera… [Christian]: They locked you the closet? Under the stairs?  [Chris]: Like developing, you know, each other. [Christian]: Oh OK I thought you were talking about child abuse. OK. I'm sorry. [laughter] [Chris]: A real darkroom. Not Harry Potter's bedroom. [Christian]: Got you. OK. [Chris]: So when I saw that, I got in. and he doesn't have a gimble. He uses a shoulder rig or I think he's got like one of those rigs for his camera, where you hold it with two hands. He's just so good that it looks fluid. Like you can't even tell. I asked him. I thought he shot the inside video with a drone, and he didn't. It was just his camera and he was walking through the property. Look the quality of your media reflects the quality of your work. That's what you're putting out there. If you're putting out a free MLS provided, you know, flipbook, of the properties that you have, the pictures that you've already listed and just putting it to music, nobody's gonna watch that. That's a waste of time. And for you to market yourself and saying “This is a video. Like we're gonna give we're gonna give a video tour of the property too. We're gonna turn all you have pictures into videos.” Welcome to 1997 like tech class in high school. Like that's…that's….we're way beyond that. [Christian]: Sure. Well and that's why I like…I mean when I first got into real estate, you know, I pretty quickly started pushing back against kind of the idea, you know, a lot of agents were being told “Hey you just do something. Just get something out there. Get content out there.” Now I'm like “Well no you better think about it. Better get it right.” Because if you put bad content out there, that's gonna hurt you worse than you if you had nothing out there, in some situations. Because… [Chris]: It's like that note, it's like that saying “There's no such thing as bad press.” [Christian]: That not true. Well because I mean if…if I…if I did…Let's say I did listing photos with my iPhone and you look like [censored] that's not better than having one good picture up there. You know, or, you know, you know, and so far we've talked about like listing videos as far as like if you're gonna do them do them, do them right, do them professionally.  But if there's…I think there's also room for, you know, more on the social media side. For the Facebook lives, Instagram lives, you know, the walkthroughs, the impromptu type stuff. You know, that's not gonna be professionally done edited, that's in on the fly type of thing. There's definitely room for that. But, you know, again have a purpose to it. Don't just be, you know, talking to talk or going live to, you know, to do it. And yeah I don't know.  What are you guys thoughts? Do you go live [Chris]: Nate? [Nathan]: No. Again… [Chris]: [laughter] “No. Not me. I don't do it.” [Nathan]:  I think a lot of these… [Christian]: I think in social media you can. [Nathan]: I think a lot of what we do right now is all dependent upon your market. And were, you know, buy or seller market. What, you know, what you're charging commission. I mean we talk about a lot of things. But a lot depends on what you charge. What condition is your market in. What…what's the house like. How much…you know, let's be honest, you know,  you're not gonna stage one hundred thousand dollar house with three thousand dollars furniture. You know, staging. Right. So it's all relative.  It's each…each situation is different. I am…like I said. I have not staged a house. I've not done video on a home. I do have one that I would consider doing video of. But I think a lot of it is overkill. It's just my opinion. Whatever you do in whoever you use just make sure they're reputable. Like here if I was to have video done, I'd called Joey…Joey T media. He does an awesome job and that's who I would hire. Right out the gate. So just make sure, you know, whatever you do it's…it's professional. That's…that's kind of where I'm at with it. [Chris]: You talked about Facebook live? And go and live on Facebook right now. Just as we're gonna wrap up this episode. [Nathan]: Oh God Almighty. [Chris]: Oh God Almighty. Heaven forbid I go on Facebook live Nate. Like really. So I mean Christian I think you've got some great points when it comes to listing media and making sure that the video is quality. Not using the stupid slideshows of images and how we do the…like the property panorama. What is it? What's the service that you have where you are? [Christian]: I mean whether it's a tool live or a factory. I mean if you wanna do a slideshow, do a slideshow. But don't call it a listing video. You know. [Chris]: Yeah.  [Christian]: Don't call it a virtual tour. [Chris]: Yeah it's a slideshow. It's not a listing video. It doesn't help market the property. Nobody's gonna look at it. Make sure that the quality's there. Or, you know, be like Nate and don't do any of it. Just be honest and, you know, what's your humor show. And there we go. [laughter] Christian is playing us back. [Christian]:  I'm watching you live well recording this.  [Chris]: Hey Christian Harris is watching. Bring them online. I'm not bringing you on camera Christian because… [Christian]: No that would be bizarre. We have like us some time vortex. [Chris]: Yeah be like…we will be looping back and forth for like minutes. So it's…it's important that we make sure that the quality of our marketing material is on par with the brand that we want to portray as our business. So, you know, any last words guys before we wrap this up? [Nathan]: No I'm good. [Christian]: Yeah….yeah I mean it's I'd say for any service you provide, any marketing, I mean it really comes down to what are you doing for the client. You know, like do you have… is this intentional or you just kind of like throwing stuff out there? You know, so whether you choose to do video or not, whether you choose to state or not. What…you know, like however you do stuff. Like make it consistent. If, you know, and…and set the expectations up front.  You know, if people are paying you to like be honest and, you know, you…you think all marketing is the same than hey or just, you know, say that out of the gate. You know, but if you think you really do something that kicks [censored] in marketing and that's why they're hiring you, hey make sure to emphasize that. [Chris]: Yeah when…what…definitely. And I will reiterate that. When it comes to your marketing, it is your name, it is your brand, it is you building your business. And if you want to be good at it you need to focus on all of the aspects of your business. You need to make sure that that media that you're putting out there to the public is a reflection of who you want to be. Period. So alright everybody thank you so much for tuning in. this has been another episode of re:Think Real Estate. We're so happy to have you on board. If you haven't already, please go to re:Think Real Estate's website which is rtre.podcast.com. Subscribe to the newsletter. You'll get a notice every time a new episode drops. And please go on…find us on iTunes at re:Think Real Estate. Leave us a five star review. Tell us what you think about the website or about the podcast. You don't even have it…you don't even have to listen to us. For anybody that's watching on Facebook live right now, just go and leave us a review. We'll be happy. [Christian]: I think. I'm the only one live now.  [Chris]: Yeah one person that's watching live right now. More people will see it later. They're always watching the recaps. So thank you so much. We will see you next week.  [music]  [Chris]: Thanks for tuning in this week's episode of the re:Think Real Estate Podcast. We would love to hear your feedback so please leave us a review on iTunes. Our music is curtesy of Dan Koch K-O-C-H, whose music can be explored and licensed for use at dankoch.net. Thank you Dan. Please like, share and follow. You can find us on Facebook at Facebook.com/rethinkpodcast. Thank you so much for tuning in everyone and have a great week.  [music]  

Download this Episode This week we discuss how to keep a real estate transaction moving forward. Listen in to hear ways to keep a real estate transaction on track to closing. Rethink Real Estate Podcast Transcription Audio length 30:43 RTRE 57 –  Keeping the Real Estate Transaction Under Control [music] [Chris] Welcome to re:Think Real Estate, your educational and hopefully entertaining source for all things real estate, business, news and tech.  [Christian]: I am Christian Harris in Seattle, Washington. [Nathan]: Hi, I am Nathan White in Columbus, Ohio. [Chris]: And I am Chris Lazarus in Atlanta, Georgia. Thanks for tuning in.  [music] [Chris]: Hey everybody and welcome back to re:Think Real Estate. We're so happy to have you here this week. We've got Nate back. He is not selling homes right now. We've got Christian here and as always here to talk real estate and all thing real estate related. So just before getting started we were talking about how agents can control the transaction better and make deals go smoothly for our clients. Nate you are always taking listings. What are some things that you are doing to make sure that you are on top of the transaction? [Nathan]: Well again I was start thinking about this a little bit more before we got to recording here but I…again I think you as an individual…we all have different types of personalities but it also setting an expectation to our client. Right. Whether you are the list side or the buy side but you have to set that tone up front.  I am a little bit of a controller. Actually a lot but I like to control the situation. You have to have confidence and knowledge in what you're doing to do all that but that is the way I operate. Most of my clients appreciate that. And the reason I brought this us is because I have got a buddy I met the other day. He is a lender and another lender he knew was taking a beating because unfortunately buyers are liars and this buyers agent is calling and is literally in Ethany [phonetics] and all over the phone. And you know at a certain point you gotta tell a client you know whether you're the agent or you are the agent or the client and your client is the buyer or lister, you gotta have control over the certain things you can't do.  For that lender the agent was his client, I would have fired him. I wouldn't have taken that you know, it is just the way it goes. Same thing, I don't tolerate certain things from my clients. I mean we call it respect. You know a lot of people like to whine in our business but it is OK to lose a client. It is OK not to get every client. And I think we often forget that. It is kind of one of that win at all cost mentality maybe. I don't like that. [Chris]: And I think if you are winning at all cost you are not factoring in what makes this industry fun, it is being able to enjoy it. [Nathan]: Yeah. [Chris]: So obviously yeah I mean I feel like you are at the point in your career where yeah you can choose and have the option to fire your clients. But why was it…why do you think it got to that point in the transaction where the agent was calling and cursing at the lender? [Nathan]: Again, you know, I have said this before in our podcast. We want to be emotional. And I have always…I think the best thing I was ever taught when I got in this industry is to take my emotion out of it. [Chris]: Amen to that. [Nathan]: We realtors…You know I am gonna beat us up but as I have said the large majority we just love to feel so important, right? We love to know that “Hey look at me, hey look at me. I am an awesome, awesome relator. I am an awesome realtor”. Like… [Chris]: “Let me tell you about me. Let me tell you about me. It is all about me. Really what do you think about me”.  [Nathan]: Yeah. And so take the emotion out of it. You know, I don't know. [Christian]: Why do you…why do you suppose…I mean I have my thoughts on this. Why do you suppose he thought it was acceptable and call the lender and cuss him out and get all emotional about it? [Nathan]: Well the guy is an [censored] [laughter]. If he were listening, that is what I would tell him. Right.  [Christian]: OK.  [Nathan]: Bottom line is whether we are in realty or not you don't treat other people that way. Like you know… [Christian]: Why… [Nathan]: Yeah why did he treat somebody that way? Probably because he had really bad parents I don't know. [laughter]. [Christian]: Yeah I mean… [Chris]: A lot of people don't think about other people as actual beings. Human. I think that si the problem. [Christian]: I mean and I am on that. Obviously treat people as humans. Treat them with respect. But you know when it comes to like being professional in this industry I mean there is a lot of things that I like to push back on in industry like you know our job is to be the rock when our clients are emotional and deals you know on the brink of falling apart. I mean if we get emotional I mean I don't know any of you…I mean I know you guys have kids. I know that when I am near my kid's emotions and he is getting all ramped up and I am ramped up, that doesn't help. [Chris]: That makes it worse. [Christian]: Worse. But I mean if I can be a consistent calm and I am able to bring it back down to like “OK let's look at the reality of things if you know…” But I think a lot of agents kind of lose their cool because they think “I am advocating for my client. I am passionate when I am doing my job”. No no you are just being a [censored] and you are [censored] things up for your client.  [Nathan]: Yeah well said. [Chris]: So that gets to a great point on helping to control the conversation to control the transaction. Is controlling emotion. [Christian]: Definitely. [Chris]: Because if we can control our emotion and understand that when we are interacting with a client it is a very…they are in a heightened state of emotion. Right. Buying a…Buying a real estate parcel, right a house or a commercial or whatever it is, is extremely stressful for people because they have a lot invested in it. It is a lot of money. It is a big transaction.  So if something bad happens they are gonna think it is the worst thing in the world even if it is just you know a small hiccup. If something miniscule like good happens they are gonna think it is the best thing in the world. So if we can just kind of maintain a level of neither good nor bad on the emotional scale than holy hell like that really can do exactly what it does for your kid Christian. It is just like calm. When something bad goes on don't worry. Got it under control.  [Nathan]: I…you know I wasn't here the last episode we recorded because I had a deal going sideways. Even my client's father flew in from Boston. He was… [Chris]: To help the deal or to ruin the deal.  [Nathan]: Well at first I thought was honestly he was gonna ruin it. He was very emotional. It was his son's house. It is you know a lot of things going sideways on this.  [Chris]: Yeah. [Nathan]: And you know he called me “What are we gonna do?”. And now we're just [inaudible] we're great. We're good buddies now. But I said “We're gonna work the problem.” “What do you mean?” I said “We're gonna work the problem. Work the problem”. I mean we get…this is 3 days of craziness in my life here recently. And he called me and said “Man I gotta tell you kept your cool.” Yeah I did because me getting upset is exactly what Christian said. It is just gonna make everybody else upset.  .So I am..I am like the captain of the ship right. If I am freaking out everybody else is freaking out. I am you know…It was not fun. But we got through it. And now here is a gentleman that like he is my biggest advocate that I could possibly have now. But I think if I would have reacted the way he was initially reacting it was gonna be really, really bad 3 days for me. And it turned out an Ok 3 days, you know what I mean. [Chris]: Yeah you gotta control that. [Nathan]: Yeah. [Chris]: That is definitely one thing that agents can do in a transaction to kind of control the tone, control the pace. It is just control our own emotions because whether you want to believe it or not people are gonna mimic you. That is just how it happens. So obviously in the deal that you mentioned Nate the agent got upset with the lender. Obviously something at some point was not communicated clearly. Because if the lender had all the information and the agent had all the information and the buyer was given all the information than usually…I don't see a circumstance where somebody is gonna yell at somebody. Christian… [Christian]: It sounds like there is an unmet expectation there. I don't know. [Chris]: Yeah it sounds like it. So Christian when you are working with a buyer and you've got all these different wheels that are moving more so than with the seller, what are some things that you are doing to set expectation with people? [Christian]: Yeah I mean I say setting expectations specifically but communication in general that is probably the most important thing you can do as a real estate agent. [Chris]: I agree. [Nathan]: Yeah. [Christian]: Because you can be a terrible agent and totally incompetent but if you can communicate well you look like you're doing your job. You know now whether or not you do the back end and actually have knowledge and stuff that is all a different thing but you can be a rock star agent and know exactly what you're going but if your communication sucks your agent is gonna think you suck. [Chris]: It is like you're up on a show. You've got the curtain right and the clients are seeing what is in front not what is behind. [Christian]: right. And so that is a long answer to basically say I am mister kind of control freak I have got processes for everything. And part of the process is this template email as part of my CRM and first thing we do “Hey we are under contract. OK here is the 5 things you are gonna expect, here is what comes next, here is what we're gonna be doing for you in the next 3 days. Here is what you are gonna be doing”. You know. And after we get past our expectance commencing here is what it is gonna look like.  You know now that is not the only communication but that is like it sets the expectations up front you know because you get a contract and now there is a whole bunch of stuff going on and now they're stressing out. You know I can't be on the phone with them every 10 minutes you know and call them off the ledge. But if you set these expectations and say “This is what happens and this is what we're doing.” And you know checking in with them whenever there is a new bench mark. That has a calming effect you know on them as opposed to they don't hear anything. [Nathan]: Oh yeah you don't have to do a lot. I mean I send out Friday updates. That is what I call it. Friday updates. Every Friday I touch my clients no matter where we are. Just to give them something right. But I mean Christian you hit…all your points were spot on. Maybe you should just have the Christian Harris school of mentoring real estate agents [laughter]. All people can learn from that. [Chris]: Definitely. [Nathan]: You know communication is key. So…I am with you on that one. I am seeing great agents who know everything very well but they are horrible communicators. [Christian]: And to your point Nathan I mean, part of that communication is even if nothing is going on once a week touching in. I do my touching on Monday because typically like if you are working on a listing that is when it is going to be the most information that we can pass. So I do my updates on Mondays. The point is going on “Hey there is nothing going on and I just want you to know so that you are not wondering what is going on”.   [Chris]: Yeah for both of you to reach out and tell somebody nothing has changed, is one of the key differentiators that I have seen for people who are successful  and who are not. Because if you are having that communication level when nothing is happening they know “Oh OK nothing is happening but I am not hearing silence”. Because it is when the seller or the buyer, they hear silence that is when they get in their own head. And they start thinking “Well is this agent really doing things in my best interest. Are they really working on my behalf”. [Christian]: You have to interfere with the doubt and the emotions kind of you know. [Chris]: It comes in the silence. Exactly. Awesome so we're getting about halfway through the episode right now. I want to…we are trying out a new segment called re:Think Realty bonus thoughts where we have a topic to discuss that none of us have seen before. We're just pulling it out of an envelope. So this one is “Things seen in houses.” I am really not sure. I guess we're just supposed to talk about things that we have seen in houses. Things like “Where is Waldo”. Print frames. Eye level in the bathroom. Things like that. Blurred out dog face on a listing photo. [Christian]: So like funny or unique things that we have seen? Is that like… [Chris]: Yeah what are some unique things that you have seen in homes that you have listed? [Christian]: I have seen atrocious staging and unfortunately it was one of my first listings when I was trying out a stager so… [Chris]: Was it really? [Christian]: I had to fire that stager and the stager I use now was the person that came in like 2 days noticed and saved the day. But yeah I have seen that. I have noticed that you want to make sure you have a local stager. Here in Seattle we've got a couple of…Well we've got a lot of island like 107 islands. And one of the…I had a friend who had a mom who does staging so I gave her a hot but she was from one of the islands and she came over and did it and her idea of staging was weaker in floral prints. And it made it look like a grandma's house and it was not gonna fly in Seattle. [Chris]: Wow. [Christian]: That is unfortunately that was kind of my fault but that was something I have seen that was atrocious and made sure it didn't get to the listing photos and that was a learning experience. [crosstalk]. I am sorry? [Chris]: What do you got Nate? What is something you have seen in a house? [Nathan]: Guns. [laughter] [Christian]: Alright. [Nathan]: No, yeah I mean like literally guns just laying out around the house. [Chris]: Oh yeah I have seen that. [Nathan]: Like hand guns and rifles. And magazines in the club. I love guns don't get me wrong but I have got clients who have a kid with me and I am like “Holy snap” like you know what's going on. Like… [Christian]: That is a different world in Ohio I guess. [Chris]: It is not just Ohio we've got that in Georgia too. I have walked through homes and opened up a closet and boom there is a shotgun just sitting right there.  [Nathan]: That is…the oddest…[crosstalk] [Chris]: Yeah so one of the oddest things that I have ever seen in a home is in a basement they…put in multiple urinals in a restroom.  [Christian]: Like a restroom? [Chris]: Like a bathroom but then they…When they finished the basement they made it like a big bathroom with like 3 urinals but no divider. Really, really weird I have no idea why. [Christian]: Were they having like a fight club in the basement?  [Chris]: Yeah yeah it was really weird. I ended up not getting that listing. Because I don't think he liked what I said about marketing that. [Nathan]: Have you guys ever been in a home where they have pad locks on all the doors on the exterior like on a bedroom? [Chris]: I have seen that one. [Christian]: That is creepy as hell.  [Nathan]: I saw that a few weeks ago and I was like “That is really weird”.  [Chris]: Yeah.  [Christian]: I wouldn't want to know what they do. [Chris]: You are either doing some child abuse there or you just got a lot of guns in that room. [Christian]: It's sketchy. [Chris]: Whatever it is. Yeah it is in the living room [laughter]. “You are not getting into my living room. This is mine”. It could be like one of those…Did you all see the listing that it was making the rounds on a few weeks ago, the sex dungeon in the basement? [Nathan]: Awesome. [Chris]: Yeah I mean just things like that.  [Christian]: Yeah like the brokerage had some pretty fun stuff, the lighter side of real estate had some pretty funny things like that.  [Chris]: Yeah definitely the things that they come up with that is absolute hilarity. I can't believe that you know when Kellen [phonetics] when he did his deal to our show got picked up by lighter Real Estate. It was… [Christian]: That was awesome. [Chris]: It was in one of the shows. OK so yeah re:Think Real Estate bonus thoughts. Giving it a shot. Tell us what you think. Make sure you leave us a review on iTunes for anybody listening. I…shoot us a comment either on our Facebook page or on the website on rtrepodcast.com.  So back to today's topic which was the agent's control of the transaction. Where they can make a big impact. Nate what is one of the most impactful things that you find you are able to do for your clients outside of communication and setting expectations? [Nathan]: I don't know. This…I mean it sounds weird but just being upfront and honest. I feel like…I feel like there are so many agents that just are not forthcoming. Do you know what I mean? [Chris]: Yeah. [Nathan]: Again it is the win at all cost or lie at all cost just to get the listing. I mean I just went on a listing in an apartment a couple of weeks ago and she walked me up in the room and she said “Nate what do you think about this room”. I started to laugh and she said “What is funny?” And I said “This is a [censored] ugly room”.  And that is all [laughter] I said all these things in here and in the bathroom too and she starts laughing and I say “What is so funny Jane?” And she says “I have had 3 other agents in here and none of them have had the balls to tell me what I already knew.” [laughter]. She said “I love that you already told me that it is ugly”. She said “I know it is ugly but everybody else says this is gorgeous, this is lovely, we will do this to make it look like this”. She is like “It is an ugly room. Why won't somebody just tell me the truth?” And I told her the truth and guess who got the listing?  [Chris]: There you go. There you go. [Nathan]: Tell the truth. If they don't like the truth than they will hire somebody else that will tell them whatever lie they want to hear. [Chris]: And if you feel like you're not up to telling somebody “This is a [censored] ugly room”. You don't have to say it like that.  [Christian]: You can be more diplomatic to be honest. [Chris]: Yeah be more diplomatic. [Christian]: That is not Nate's style. [Nathan]: That is not my style lets be honest. [Chris]: Just so that our audience knows. You don't have to do it Nate's way. You can tell somebody “No this room may not be up to the aesthetics as the rest of the house. We probably won't focus our marketing efforts on this room”. [Christian]: Or “You can burn this room down”. Or something like that. [Chris]: Yeah. Or “We could put up some fumigation label outside so nobody comes in”. Whatever it may be, but yeah on that line with honestly I think one thing agents have sometimes gotten self-caught up in is when they find something that they don't know they will try and [censored] their way out of it. Instead of saying “I don't know, let me get you the answer. We will make sure that we do this the right way”.  And people feel like you know winning at all cost they want to feel like the expert they always want to be in the expert shoes, they don't want to step back and admit you know, “There might be something I don't know here”. You know that is kind of one thing that I think goes a long way in controlling the transaction is don't be afraid to admit where there is something that you haven't dealt with. That is why it is important to have a good team unless you are Nate. In which case you are solo.  But if you've got a good team or resources or you know even friends and people that you respect in the industry and people that you can reach out to as long as they're you know you are following your broker's direction, you are making sure that everything is legal and ethical. I don't think we have to cover that at this stage in the game.  But yeah just making sure that where your shortcoming are you are not [censored] through them. Christian what do you think are some things that you now can help control the situation a little bit more throughout the transaction especially due diligence, getting into financing and getting up to the posing table? [Christian]: Sure so I mean there is obviously like a minimum standard of what an agent has to do. I am more like how much can I do to help an agent. You know. So for us you know I mean like we all know that is…you know good buyers. You know it is the buyers responsibility as part of their…you know once they get a contract and they're talking to a lender and get all the documents they need and stuff. They need to reach to interns company and get a policy in place and that kind of stuff.  But like that is not really on our shoulders but I still make it a point to you know a day or 2 after to send out an email and say “Hey this is a reminder, these is the things that you need to do. Make sure you get your lenders documents at town manor, make sure you get a quote on home insurance because they can't hold an appraisal before you do”. You know just stuff that is not necessarily in my ball part but it helps them know that, like “These are things that you need to do as part of the process”.  [Chris]: Yeah and going an extra mile is huge. We've got a lot of good feedback ever since we started implementing move easy, which ties into our transaction management system. So move easy when our agents mark that their client is under contract they get this digital check list and resource bank that tells them everything that they need to do during the move from “Don't forget to order your moving supplies, don't forget to line up your child care, you're getting all your pet immunizations” whatever it might be. We put all of it in a checklist and our agents…our clients seem to love it. For those that take advantage of it. [Christian]: And that as I recall it is free for agents right? [Chris]: Well it has to be set up on a brokerage level but yes it is free. [Christian]: So talk to your broker about setting it up for you. Or if you do something like client giant you know per agent they do kind of that concierge. They take care of all your utilities and that is helpful too. [Chris]: That's awesome yeah. And that was Jay O'Brien [phonetics] we had him on last year. Definitely a great episode to go and listen to about providing what was it 7 start service in a 3 start industry? [Christian]: Yes. 5 start service and 3 star…7 start... [Nathan]: 7 star… [Chris]: 7 star in a 3 star. [Christian]: It's a good… [Chris]: Yeah it's a good one. He's a really good person to listen to as well.  [Christian]: Yeah for the service yeah.  [Chris]: Yeah I mean there is so many things that we can do to go above and beyond. You know in Georgia the typical transaction is byer gets contract. Contract gets due diligence. Due diligence gets home inspection. After home inspection there is no other inspection done. They may be right on. I have never seen anybody do a lot of base paint test. They just kind of waive that and you know that is it.  But there is so many other things that we can do. We can advise for air quality testing if there are allergies present which that I have seen happen. Partnering them with an insurance agent to make sure that the home is insurable and check for what the previous claims are. Like getting a clue report pulled. All of these things are huge and can make a big impact in not only your client experience but also controlling the situation, making sure that things are discovered before we get too far. So that at the last minute when we get to the closing table things are reared in their ugly head.  [Christian]: So speaking of kind of above and beyond just us doing our jobs for our clients, I mean what are you guys thoughts about health warranties? Typically I have written those off because they are so limited typically. As far as what they replace in the time frame. But like recently I helped a friend of mine buy a house kind of outside of my normal area a little farther outside in Takoma. And the recommended inspector from some of my you know, agent friends down there, they actually include a very inclusive home warranty that I was very impressed with.  And no extra charge you know like because they already did the inspection on the roof so they guarantee the roof is gonna hold for 5 years and appliances for this long and you know all these extra stuff that seems like a real value add for no additional money either to your pocket or out of their pocket. But what are you guys thoughts on hat? [Nathan]: I mean here in Ohio it is long. A seller typically pays for home warranty. I like them but I like to choose it because there are certain home warranties that have what they are called caps or limitations on what they will cover. And if you know those I don't think that is a good value. The ones that I typically go with on home warranty has no caps. The other side of it form a listing side is they have seller protection from the moment we put that house on the market, the items are covered in warranty. But I think you have to articulate to your client that a home warranty is good for your major stuff. [Chris]: Yeah sure. [Nathan]: Your HVAC furnace. [Chris]: Sometimes. [Nathan]: Yeah well OK again here they're smart like don't go and have a home warranty claim when you had an inspection that said it was bad right. That is not the way to do it so… [Chris]: And on top of that if you have a 25 year old HVAC system it is not gonna pay for a brand new system if it [censored] out. It will have a maximum amount that it will pay towards but on a 25 year old system it is gonna not cover that switch over from you know what was it our 20 to now 4 10A or whatever the new coolant is. So you got explain that to your clients.  Again back to what Nate was saying. Expectation setting. Back to what Christian was saying. Expectation setting. Making sure that everybody understands where the value is when they get it. [Christian]: So what you're saying is that home warranty can be of value just make sure you do your research that is actually a quality home warranty that provides something. [Chris]: Yeah. [Nathan]: 100%. [Chris]: On the first home that my wife and I ever purchased, 3 months in the stove shorted out. It came out 50 dollar call, rewired the entire thing and it worked fine. It is still in that home. But that was a lot less than it would have been you know to have you know a new stove or bring out an electrician so it has its values. [Nathan]: Yeah yeah, I just had to call a client and we were 2 days outside of closing an she was the seller and the hot water tank failed. We had seller protection on it. Guess what 65 dollar call, brand new hot water tank. [Chris]: There you go. [Christian]: Save your 500 dollars. [Nathan]: Saved probably more than that and you know she was already stressed out and called the client. I said “Let's have home warranty take care of that”. Again if you know what you're getting can be a great value. But… [Chris]: Absolutely.  [Nathan]: There are a lot of junk ones. [Chris]: And all of this…yeah all of this goes in line with taking control of the transaction and making sure that we are directing it in a way to get it to the closing table and we are directing it in a way that is in our client's best interest.  [Christian]: Yeah and speaking of staying in control of that transaction one of the things that I see…I moved to a whole other topic on this whole episode, but is that you know what do you do to continue to provide value and stay in front of your clients after closed? Or what the agent is gonna feel at that? [Nathan]: That is a whole episode.  [Chris]: Yeah that is a whole episode. Why don't we get into that next week [laughter]?  [Christian]: OK well I will give a little teaser than. [Chris]: Let's give a teaser and we will get into it next week.  [Christian]: What we started to do is a sort of called home button and that has been great because it is cheap. Right now it is only 25 dollars. You know, to use it and you get it for 500 clients. But basically it provides every month to your home buyer, it provides them with an automated like “Here is what your home is worth and if you refine,  this is what it would look like, if you are AIRBNBed one of your rooms this is the value if you added 300 dollars a month extra payment you know you would pay this much less over the course of yadayada”. So basically provides all these really easy to understand analytics for a client's house that is branded to you.  [Chris]: Awesome.  [Christian]: And instead of you know you sending out some junk email drip thing every month where they probably don't even look at, here is something that directly relates to their house that they're probably gonna look at it. And you can see all the analytics and back end when they're click on it. [Chris]: Thanks for tuning into re:Think Real Estate. Make sure you join us next week as we talk about how to provide value post-closing and control that relationship into the future. Christian you gave a great teaser on that. For anybody who hasn't please go to rtrepodcast.com. Sign up for the newsletter so you never miss when we drop an episode and leave us a 5-star review on iTunes. Have a great day everyone.  [music]  [Chris]: Thanks for tuning in this week's episode of the re:Think Real Estate Podcast. We would love to hear your feedback so please leave us a review on iTunes. Our music is curtesy of Dan Koch K-O-C-H, whose music can be explored and licensed for use at dankoch.net. Thank you Dan. Please like, share and follow. You can find us on Facebook at Facebook.com/rethinkpodcast. Thank you so much for tuning in everyone and have a great week.  [music]  

Download this Episode Welcome back for another episode of re:Think Real Estate. On today's episode, we reach back to our second episode to review our predictions for the real estate market in 2018. We discuss where we were really right and where we were less right! We also talk about our predictions for the 2019 real estate market and what we believe will happen this year. This real estate podcast is about helping brokers and agents think about how their business is run. We discuss what is working for us in our business and how our businesses are growing. If you have any questions or topics that you would like answered on the show, please email chris@sellectrealty.com. re:Think Real Estate is the best real estate podcast to follow for real estate brokers and agents looking to build their business. Tune in weekly here or wherever your podcasts are found. We are on iTunes, Google Play, Spotify, and more. Please leave us a review and let us know what you think. Episode Transcript: RTRE_Ep_45 Audio length 34:58 RTRE 45-2019 Predictions for the Real Estate Market [music] [Chris] Welcome to re:Think Real Estate, your educational and hopefully entertaining source for all things real estate, business, news and tech.  [Christian]: I am Christian Harris in Seattle, Washington. [Nathan]: Hi, I am Nathan White in Columbus, Ohio. [Chris]: And I am Chris Lazarus in Atlanta, Georgia. Thanks for tuning in.  [music] [Chris]: Hey everybody and welcome back to re:Think Real Estate. We're here early in 2019. I am here with Christian and Nate. Guys how are we doing? [Christian]: Hi, how is it going? [Chris]: Nate is silent. [Christian]: No Nate.  [Nathan]: Good good. [Chris]: Oh he's with us. He joins us today. Last time…so last week we talked a little bit about…shoot what did we talk about last week? [laughter] Did we like…So last week we talked about… [Nathan]: Do you remember? [Christian]: We just recorded it. [Chris]: Was it in the notes? [laughter]. Smart. Thinking smart. So last week we talked about what is it gonna take to sell a home in 2019. We used the “Think Smart” acronym and we mentioned that we were gonna talk about our second episode from when we launched the podcast which was our predictions for 2018. So we wanted to talk and see what came true and what didn't. So Nate we're gonna start with you. First off let's hear what you had to say in episode 2 of last year.  [Nathan]: I am scared.  “That's the market is gonna continue to grow. Unemployment is at an all-time low. Job creation is growing gradually. Braeden wrote about that. And so I don't think we're gonna see the housing market slide. I think we're gonna see it grow very fast.  In our market here in Columbus we had an all-time low in inventory. The new builts are…you can't build them fast enough so it's…it's gonna continue to grow. The challenge I think for real estate agents is how do you get your slice of the pie and how do you do that?  The other thing I think we're gonna see is more influences upon technology or AI, but we have do we have a balance of what we do as individuals and a balance of what that AI does for us as well.” [Chris]: Alright so Nate a lot of it was…for you was that it was gonna be continued market growth, that it was gonna be pretty…Value was gonna be of great importance. Providing that value for our clients and really working on improving the communication. Tech and AI, you…having that balance to assist. What do you think? [Nathan]: I think we're still there some. I think it's gonna evolve even more in the sense of I think there was a lot of playing if you would with tech and we saw like you said when we were talking. Kelly came up with KW and several other things. I think that what we're gonna see though is from all this tech people are gonna realize again we actually provide the most value.  Again I go back to how do we blend the 2. We saw a lot of companies come in a fury all trying to get their slice of the pie and 6 months later they were an afterthought, right. So I think that we realize there's a space for it right and that's good and I am OK with that but there's still a very large space for us and what we do which is awesome.  I don't think we're gonna have that…What's that Will Smith movie. IRobot or whatever you know where everything is that way. Right so…[laughter] but there should be a large…I don't want to say “curtailing” maybe is the word. But we're gonna see some of that dial back I think a bit. And you know you are already hearing depending of what circle you run in, about you know agent value and what agents provide. I find it comical. I am not picking on Kelly, but you all are late to the party. Now it's all about “OK great we had that”. Now it's going back to being agent centric almost right. So…Interesting that you know if you're talking about tech now than you're a little late. So… [Christian]: Sure. [Nathan]: So I think you need to be focused on what you do and what you provide to your clients.  [Chris]: So I think you are right. You know last year you said that there was gonna be a balance between using technology and the agent providing value.  [Nathan]: And we're finding that out. [Chris]: And I think that…I think that that's how the year worked out. There was…I think you had all these big announcements about tech but then kind of half way through the year I think it got fueled by that whole Facebook thing…is that when the huge data breach happened. I think that a lot of people started putting more focus on the relationship, on how they're interacting with the people. [Christian]: And I would say I think on the stuff that plays for tech…but I think kind of the sexiness of it is wearing off a little bit in the sense of I think it's a little bit of a tech and automation fatigue, you know, that the trends is going back to the basics of relationships and serving your clients. Whether that's tech of whether that's man also. [Chris]: Yeah I think people are finally realizing that they're not gonna push a button and that everything is gonna be done for them. Like you could push a button and they can send an email campaign and that helps but you gotta pick up the phone. You gotta talk to people and you gotta have that one to one connection so…Christian…Nate well done I think you were spot on. I think that your predictions for 2018 came true. What do you think Christian, you think he was right? [Christian]: Unfortunately, I think he was. No I think it's good. Yeah I think it was pretty spot on. [Chris]: Yeah you're guru level there Nate. Watch out don't let it happen again, you might think you're smart. [laughter] [Nathan]: You know I am gonna keep fooling people and sooner or later they're gonna be like “You're not fooling me anymore”. [laughter] [Chris]: Well done. Alright Christian let's hear what you had to say last year. [Christian]: “I think there's gonna continue to be that tension between what you'd call the discount model tech enabled and the traditional model. So as Nate said I think there's gonna be increased need for individual agents and brokerages to define themselves and provide value outside of just…just do real estate and “I am gonna give you a good experience””. [Chris]: Alright so you were talking a lot about the push back against the traditional real estate model. What do you think? You think that came through? [Christian]: I'd say for the most part. You know I mean the…the…what we're seen with the EXP you know virtual brokerage I mean they're…I think you're saying they like acquired or gathered 16.000 new agents last year. [Chris]: Yeah they're 16k. [Christian]: You know Compass, you know, they're kind of a hybrid as far as, you know, they're not franchised but they're definitely pushing the tech in the marketing and doing things differently. They're, you know, growing like…like wild fire, wild flowers. I don't know. They're growing, they're doing good. [Chris]: You're out in the west coast you should know what a wild fire is.  [Christian]: Yeah that's true [laughter]. And you know I think we've seen, you know, big…the big growth in the indie brokerage you know scene. The rise of indie brokerages as far as people wanting to get a better consumer experience and a company and agents that are invested in the community and you know just totally gets a…you know what's kind of in the local marketing and stuff. And you know to see Zillow you know we're getting into their iByer thing and you know doubling down in the consumer. Advocating for consumers and that's their main focus and you know there's been a lot of hub hub, you know, a bunch of murmuring in the real estate space with you know “Is Zillow alienating their premiere agents or is what they're doing working of bettering stuff?”.  I mean they're willing to and have enough of market share. You know they're a brokerage, you know. they make clients as agents but they're willing to mix it up in order to continue pushing the bounds of what the consumer wants. What's best for them as opposed to the traditional franchise which isn't interested in that at all. They're interested in maintaining a status quo. And I think you're seeing they are losing market share because of it. [Chris]: Yeah. Yeah I agree with you there. We saw pretty much a lot of franchise agents move to the EXP model because you know they're gonna play this…spend that whole split. You know they don't want to play for the overhead. They like that whole MLM aspect of it where they can get a percentage of it back.  Now another thing that you mentioned…So I think you were right on point there. Another thing that you mentioned at the start of last year were that efficiencies with technology were gonna increase the tension on commission rates. Things that we can charge as a broker. Do you think that played out? What do you think? [Christian]: You know I don't have any numbers so you know I am not really sure but I mean I am increase hearing more about you know 100%, you know, commission models and that sort of thing. Which I mean those have been around for a while but they seem to be getting more and more popular as agents are looking to cut their costs and not have a big split.  Yeah I don't what the trend of that is gonna be because, you know, even in my book there is a give and take. If you're getting 100% commission split you're probably not getting a lot of support. And if you have a high split theoretically you'd be getting more support and have a physical brokerage. [Chris]: Theoretically. [Christian]: And access to your designated broker and all that kind of stuff but like…So I don't know it's hard to just get a blank statement saying “100% models provide you nothing” because there are some that provide just as much as a full service. I am not really sure how they do that other than maybe just being massive or having you know no broken order or no staff or something.  [Chris]: Nate what do you think? Do you think that played a part last year? [Nathan]: Yeah I mean again I am you know the indie small guy too that was with the big name. Still got a lot of strong opinions on it if you would. [Chris] : You? Nah. [Nathan]: It…It's…I go back to the word we talk about all the time. It's about value. But you know what we do now in 2018-19 is way different than what people did in 98-99. Like it's just…it's different so again you have to adapt you have to change.  You know somebody the other day was asking me you know questions about flat free models, this and the other. You know he was thinking about going to Cornecall [phonetics]. I hate the word. Everybody says it. But discount in commissions and again I can argue that all day. But I asked him… [Chris]: It's a different model. [Nathan]: Yeah right that's what I said. I said…I asked the guy and said “You pissed off at Amazon?”. And he said “Why?”. I said “You mad at Amazon?”. He said “Well no I get a great deal through them”. I said “OK don't be mad at me”.  Right it's just a different thing right. Nobody…You know everybody says that's not a fair comparison. It's just somebody did something different, right. And so I hate the word discount. Right it is what it is.  So…I think we will still see more people going to the independent side if the large big bucks brokerages can't figure out this value component. I think too many people see through what they quote on quote “offer” right now. The smart ones that is.  Now you know a new agent, there's different ways to go about it and what they offer them but I mean you call me. I just got a phone call. I know what it is about. But he's gonna try to sell me on what they can provide me. Man you better come on with a strong pitch. Like best I know. Like…Because I am not going anywhere. So I don't know… [Christian]: What…And I mean that's the…that's the tricky thing about the franchises and the value proposition is that they really are stuck in the where everyone is an independent contractor therefore we can't tell them how to do their business therefore they don't control any of the client experience for their agents. And all the tools they provide are totally optional you know and if they kind of suck because you know “Hey we have our own proprietary internal CRM or home search site or app” Or whatever. They're probably gonna be terrible and part of the reason you're paying so much is because you spend all these money to cut some bill some part stuff that can't compete with Zillow or a dedicated third party CRM, you know.  [Nathan]: It keep swinging at home runs. [laughter] [Christian]: I suppose indie brokerages which their focus is gonna be agent support, standardized culture and processes and training… [Chris]: We might have a bias [laughter]. [Christian]: Yeah I mean we don't…that is…that's what I have seen but universally that's what I see. I look at any of the franchise around here and the client experience and value proposition is all over the place as opposed to indie brokerages where that is their bread and butter of the “This is the value we provide. People want to be here because of blah blah blah blah blah”. You know and somebody goes to franchise the only value proposition I hear is “Well you get the name”. And I am like “That's not value proposition.”. Like… [Nathan]: If somebody comes to me again with “Hey once you've reached the third level…”I…If I wanted to be a recruiter guess what I would have been? I would have been a recorder. Like that's just not what…That's an MLN to me and you know and sorry if that bothers you. Actually no I am not sorry if that offends you. I am who I am. But…[laughter] getting to the third level whatever it is it has 0 concern for me. [Chris]: Every day I have somebody from EXP either friend me, send me a Facebook message, a LinkedIn request. “Hey what do you think is gonna happen with the market next year?” It's like they're pitching this. They study it. They train on it. [Christian]: I love it when they don't do their research and they're just pitching the brokerage owner. ”Hey you wanna come over”. Like “Yeah you don't know who you're talking to do you?”. [Chris]: There's a lot of averages. Anyway. Back to your predictions Christian I think that you know when you talked about the efficiencies with tech putting tension on the percentage I don't think you were off. But I think that what ended up putting more tension on it was how much value somebody can bring to the table.  I don't think it was tech. I don't think it was really tech putting the pressure on it. I think it ended up for 2018 really being how much value was brought in by the individual agent. Were they doing the things they were doing like the give back programs? And the high quality photos and met report? I think that ended up playing a huge role also. Tech to the stand point that you know like you mentioned if they're heavily leveraged, if they have lots of debt, they have to charge much more. I think you were right there but not necessarily on the bottom line percentage. [Christian]: The reason percentage. [Chris]: Yeah. Yeah I think in a…I think the broader reason ended up being value. [Christian]: Sure. [Chris]: And Nate after what you said I gotta presume that you agree with that? [Nathan]: Yes. [laughter] [Chris]: Alright so last but not least let's hear what I had to say last year. Take it with a grain of salt.  “We've had a lot of tech. Like the last 3 years in real estate it's been like nothing but tech. It's “Oh what's your website, what's your SEO what's your…you know how are you getting your leads? Are you doing you know the big 4 or you doing like predictive analytics now?” I think we're gonna see a lot of step back in those services from a lot of agents. And I think there's gonna be a big push as a lot of these suburbs bring in an urban feel as they're being redeveloped. I know we're experiencing a lot of that in Georgie.  I think we're gonna see a lot of agents really refocus on being hyper local. I think it's gonna be a lot of tech in the support and the systems and how they're able to make the transaction smooth but I don't see these big companies that are coming in trying to do disruption. I don't think we're gonna have a lot of focus on that”.  Alright so I also thought that there was gonna be a lot of tech. That there was gonna be a lot in the leads SEO, Zillow and predictive analytics which I think we saw a lot in that field. Right guys? [Christian]: Yeah. Yeah I mean there's certain things that you know…I think that you…I don't think…[background noise]. [Chris]: Stop doing that. It kills your mic [laughter]. [Christian]: I don't think…Oh does it. OK sorry… [Chris]: Yeah [laughter]. [Christian]: Yeah so I can assure things that aren't really ready for prime time. Like I can't speak push on like AI or…you know Alexa Skills and that sort of thing you know they're very rudimentary but there's been a lot of focus on them you know. So we'll see that grows in importance in 2019. [Nathan]: I don't think it's gonna grow really honestly. I think we're kind of out of…hat do you call it. Out of very flat. I think people are still like...There's a lot of discovery there has to be done with that stuff and I think we are a long way out before it really needs to concern any of us. But I could be wrong. [Chris]: Well tech played a big part. Now we have the whole conversation about the wrestle or the…the standardized data feeds that the MLS has put out. Here is a lot of pressure on the MLS to move to an API format which would pretty much make the IDX obsolete.  So there was a ton of work in the tech sector for 2018 but also probably my biggest prediction for last year is that we are gonna start seeing a lot of redeveloped neighborhoods. Lot of small town down town communities start urbanizing. Start feeling that…that kind of multiuse feel and that along with that we're gonna start seeing an increase hyper locality with how the agents operate. I think that is where a lot of independent broker rise is coming from. Small brokerages operating on a very hyper local kind of manner. Really owing the neighborhood, owning the town, owning the down town. Are you guys seeing that? [Christian]: Yeah I mean definitively in kind of the urban area Seattle even you know even the cities do some pretty big zoning changes to increase density in the loafer or in the ADUs and putting in a new light rail and all sorts of changes for you know a denser urban core. So yeah. [Chris]: Nate what are you seeing in Ohio? You're muted. [Nathan]: I just lost my whole train of thought when it got muted. [Chris]: Nate what are you seeing in Ohio? [Nathan]: You know what I see in Ohio and I will probably get slammed for this. We're a busy market but what I see in Ohio is we're always a day late and a dollar short or whatever it is. But we're late to the party. I don't know where I am going with this right now so just edit this out. My whole train it's… [Christian]: But there's been… [Nathan]: My whole train of thought just went sideways because I had a kid walk in the room. [Chris]: So we're talking about the urbanization of downtown areas in the suburbs. So the hyper locality of agents about really owning that. What do you think are you seeing that in Ohio? [Nathan]: Here we go. Yeah you are seeing some hyper locality. There's, you know, I could sit here and name quite a few agents off here real quick that specialize in certain areas. Again I still argue you don't have to. Does it help? Yeah I mean why…why go and have this wide area that you're gonna cover such as myself. I go everywhere. It can be a pain. When you can do just as well on a small hyper local area that has value.  I think you're getting push back thought now form consumers a little bit because it…you have the hyper locality but you also have the gentrification of neighborhood that is pushing on a whole other segment that is causing a whole other problem that I could talk about for days. So there's good and bad in it with both I guess. So…But you are definitely seeing it here. [Chris]: Yeah now you're starting to see like brokerages really taking advantage of that becoming that hyper local brokerage, that downtown brokerage?  [Nathan]: From the perspective of teams yes but not a brokerage like…You know downtown say you want to be in a certain area of the short north or what not here. VNR, View Tech and Rough you know like boom. But automatically they come to mind. Right? If I go down to an area called Old Oaks than I think like Jim Ross. He was…left Key Realty to just go to Remax I think. So again it's not necessarily the brokerage, it's the individuals or the team that is down in that area. [Chris]: Excellent. Alright so I don't know. What do you guys think? Do you think we were on point? Do you think we got 2018 right?  [Christian]: I think we're about 85% accurate. [Chris]: 85% accurate. [Christian]: Or maybe that's me. Nate was pretty spot on. [Chris]: Nate…Nate I think was dead on. [Nathan]: I feel that I mean yeah I feel good about what I said then. I feel good about what I say now. But I don't know looking at 2019 I think we're gonna see…what's the proper word. Regression? Is that right? [Chris]: Well let's talk about that. Let's talk about what we're gonna see for 2019. Where do you think we're gonna see regression in?  [Nathan]: I think people have over complicated what we do. And I think we're gonna see a “back to basics” kind of mentality. Which is upfront, relationship driven, client focused mentality for the successful real estate agent.  Now I want to be very specific. I want to say the ones that are successful I think really…You know when I say successful I mean long term but I think we're gonna see a heavier focus on this relationship building, you know not kind of hit it and quit it mentality. Or letting AI do the work for them. Because they realize they have automated everything they do. They have lost touch with those people. I mean your word for 2019 is relationships. Right? [Chris]: Yeah. [Nathan]: So again I don't…You know some of us can see the wiring on the wall so I think we're gonna see that we're gonna go back to basics. That's what I'll call it. Back to basics in what we do. AI is a good thing. The technology is a good thing but let's get back to the core of who we are.  Joe Rand has got that new book coming out. I am telling you he even speaks about it. I guess I can say that. He talks about it. We're gonna go back to basics so… [Christian]: Thank you Nate you stole my thunder. I was gonna say focus on relationships and client experience. So yeah there you go there's my 2 sense. [laughter] [Chris]: Alright well Christian what else do you think is gonna happen in 2019? Let's take your predictions now outside of you agree with Nate. Great. What's gonna happen either market or interests, broker level? What do you think? [Christian]: Sure. I mean I think the markets, the writings on the wall I don't think it's gonna…I don't think it's gonna fully flip to a balance to a buyers' market. But I do think the silage market is gonna severely cool.  You know like here in Seattle people are freaking out because, you know, the last half of year it you know home values have dropped 11%. But a year of a year it's still up 2 %. So I think we're start seeing the normal umbers of a healthy market which are gonna be 2-4% increase over a year and not 40% for the last 5 years which is what Seattle has seen. So… [Chris]: Yeah no biggie. [Christian]: So I think it's gonna…I don't think it's gonna entirely shift. I think…you know or level out. I think it's gonna continue going up in a much more moderate. [Chris]: I think that…I think that you're probably on point there and that can probably speak in the nation as a whole. I think that for Atlanta we're probably gonna see something similar. Continued growth, but growth at a much slower rate. I think that our growth rate is probably gonna be cut in half at best and probably by 90% at worst. But we're still gonna grow. We've got too much infrastructure that is booming. We've got extreme demands for jobs here. So as long as that stays steady I think we're looking at something similar.  So Nate you kind of covered what your predictions are for interacting with clients.  Christian you kind of covered what we can expect for 2019 for the market.  So I guess that leaves the broker level. What we can expect for brokerages. So for 2019 I think we're gonna see a divergence in how…what kind of brokerages take off. And I think it's gonna go really 1 of 3 ways and we're gonna see a lot of movement in 3 different directions.  1 is you're gonna see the Redfin partner agents and Redfin agents growing exponentially. I think there's gonna be a lot of growth on that bottom sector of low commission, kind of higher quality service but low commission. So there's gonna be that movement.  Than I think on the other side you're gonna see agents moving towards very high tech companies. That's gonna be your Compass. And your EXP. You're gonna have that “We want high tech and we want low interaction”. They're gonna be flocking from the traditional franchise model.  And I think the third direction that they're gonna be moving into is the independent boutique. We're gonna see a rise of boutiques that are very…cultured centric. You're gonna see people who get together and the culture is the most important part. We're gonna see a lot of rise from that. I think that you can expect a lot of brokerages across the nation that are maybe 10, 20, 30 agents right now to probably double or triple their numbers so long as they can keep the management and the culture intact as they grow. And that's gonna be one of the hardest things to do that that segment is gonna have to kind of deal with and overcome.  But I think that we're gonna have those 3 movements. Away from franchise into high tech, low touch into the low discount model high volume and then the independent movement. [Christian]: Interesting. Can I give a little push back into one of those? [Chris]: Please do. [Christian]: I think, I could be totally wrong. I usually am wrong. That the… [Chris]: No you're 85%. [laughter] [Christian]: I am 85%. I think…I think that the discount brokerage model I think it's…we're not gonna see as much growth in that. I think that the word is starting to get out that you know Redfin is not so great. That the experience isn't so great. The outcome isn't so great.  At least that is what I have seen here. You know I have had a couple of…a couple of you know listing appointment that were like “I never list with Redfin”. You know. And because of that I think if you understand value and you maybe talk with people that use them you know word gets out that you know yeah you save a percentage or 2 but at what cost? [Chris]: Yeah and here's the reason… [Nathan]: For clarity let me ask you a question. List with Redfin or list with a Redfin partner agent? Because they're different things. [Chris]: Well hang on. [Christian]: I am saying the model.  [Chris]: Oh boy. [Nathan]: Oh no you can't do that, you gotta break it down. [Christian]: Well I am saying the model in the sense that like if your primary value proposition as a brokerage is more cheap that comes at a cost. And I think the word is starting to get out that discount brokerages by in large provide an inferior experience, results, whatever.  Now I mean obviously that depends a great deal on the agents but if your model is you know you've got one listing agent for an entire zip code of you know a million people there's not gonna be a high touch good quality experience there you know.  [Chris]: Wow and here's the… [Christian]: You know and even Redfin is shifting greatly away from the original model to not being that much different than the conventional brokerage.  [Chris]: Yeah here's the reason why I think that that is gonna be one of the moves.  [Christian]: OK. [Chris]: We have 1.4 something million realtors. We're almost back to 2008 levels of the number of realtors. We're gonna be switching to a market where agents don't understand how to deal with properties that have been marketed long. So they…the time on market is gonna increase. It's gonna be a lot of realtors that have not had to really work like hard to buy or sell a house. You know for the buyers agent their skill set is turn a nob and open a door. For the seller skill set the selling agent you know their job is to put the property on an MLS and let it sell. They haven't had to challenge their skills.  So I think that when this market shifts we're gonna loose agents. They're gonna leave the industry. But I think that a lot of those agents may move to a higher volume lower skill set style. Not to say that Nathan is lower skill set but to a discount model of where they're able to do a lot more business at a lot lower rate. Just because they don't have that background to be able to go out and compete in the market with agents that are on a higher skill set.  Now Nate that's nothing against you because you operate at a very high skill set. And your marketing is at a very high quality. But there are agents out there that do not. So… [Christian]: Yeah but there's only so much room for them. You know Redfin is only gonna hire so many people. You know. It can't be like “I can't make it as an independent contract” or something.  [Chris]: Yeah not just Redfin. [Christian]: Yeah that's a big one yeah. [Chris]: But there are plenty of regional brokers. There are plenty of regional low cap brokerages that are not gonna force an agent into charging whatever the broker's set rate is and they can go and charge whatever they want to charge. They're gonna move in that direction. They're gonna move to where they're competing on price not on skillset. So…so… [Christian]: Oh sure I can see that. Yeah. [Chris]: So I am mending my predictions for 2019. It is not specifically to Redfin or Redfin-like companies but to companies where the broker is more lenient on what they can charge. Where they can set their own rate and they're gonna compete on value. OK. [Christian]: OK I can see that. My hang up was kind of the Redfin model you know. [Chris]: Got it. Got it. So nothing against Redfin. Great company. Very high productive employee model company. [Christian]: There's gonna be a reputation where individual agents in standard franchise aren't per se. So... [Chris]: Well they're also extremely productive because their salary. Unless they're partner agents but the Redfin agents that are with Redfin corporate, their salary. So they are… So recapping again for 2019 Nate what is happening? [Nathan]: We'll see back to basics from a realtor perspective, agent perspective. We're gonna see an interest rate bump. And we'll see some market correction. We're not gonna have crazy like last year which was great but I think we're gonna see some stabilization which is…which is fine by me. [Chris]: Back to basics, relationships, more of a balanced market. Christian what's your recap? What's happening this year? [Christian]: Yeah I think the market is gonna be slowing down but not necessarily becoming byers market. It's just gonna be a slow down on the increase in values. We're seeing the economy like it used to be good and inventory is still rather limited but we're plenty folding, it has been this whole last year. [Chris]: 2019 you've got our predictions. The word…my word is relationship for the year. I think that Nate is right on point with that. If you haven't go to the website rtrepodcast.com. Subscribe. Get our updates every time a new episode is launched. This has been re:Think Real Estate. We're now well into 2019. Let's kick some butt. Take care.  [music] Thanks for tuning in this week's episode of the re:Think Real Estate Podcast. We would love to hear your feedback so please leave us a review on iTunes. Our music is curtesy of Dan Koch K-O-C-H whose music can be explored and licenced for use at dankoch.net. Thank you Dan. Please like, share and follow. You can find us on Facebook at Facebook.com/rethinkpodcast. Thank you so much for tuning in everyone and have a great week.  [music]  

This episode is the the second in the series of interviews exploring how entrepreneurs scale up their Serviced Accommodation businesses. In this episode Chris interviews Graham Lindley as he talks through moving from being a mobile engineer to forex and crypto trading, and then finding his passion in Serviced Accommodation and Property. Chris and Graham then look at how the journey Graham has been seen him scaling up his Serviced Accommodation business, and how it has happened. Graham is managing director of Prim Short Stays in Nottingham, UK.   Show Notes: The Serviced Accommodation Podcast is a show brought to you by Chris Poulter and Ritchie Mazivanhanga aimed at new and experienced property investors alike. With each show we help you Start, Systemise and Scale your Serviced Accommodation Business. If you would like to ask us a question or discuss anything in this episode, please join The Serviced Accommodation Podcast Community on Facebook, and ask away. To listen to more episodes or get more information go to www.thesapodcast.com. Find out more about Graham’s business here: https://www.primshortstays.com/     Transcription: Chris: Hi, I am Chris. Graham:  And I am Graham. Chris: And welcome to the Serviced Accommodation podcast.   Chris: For continuing our series on scaling up and how to scale up your Serviced Accommodation business successful, today I am going to talk to Graham Lindley. So Graham, thanks for joining us. Graham:  Hi, thanks very much, it’s my pleasure. I have been listening since the beginning, so it’s quite strange to now be inside here. Chris: The strangest thing is when the podcast is released and you sat in your car listening back, and it’s like, that’s my voice. Graham:  Oh really. Chris: Yeah, I am sure. Graham:  I have got all that to look forward to. Chris: You do. Absolutely. So could you give our listeners just a little bit background on yourself, like where you kind of came from, from a profession, and where you are based in the country. Graham:  Okay. I live in Nottingham, being there around eleven years, after growing up in Kent. And I have been an engineer all my life, since I left school, in fact, I started when I was still at school — and that was very good, I enjoyed it very much. I was always in different places, meeting different people, whether a country man or a council or state, I always find a way of getting on with everyone, and really finding ways to help people and being resourceful. And so I was a mobile engineer with my van and that’s what I did. Chris: So when you say engineer; what type of engineering was that? Graham:  So I did security and fire, I guess the technical term would be a technician. In the trade we all call each other engineers. So for the first part I was mostly installing and then transitioned more towards maintenance side of it, so I didn’t really have to call around lots of space and things like that anymore. Chris: No, but at the same time I imagine like, diagnosing and repairing stuff is a lot more difficult than installing in the first place. Graham:  Yeah. Really it was the thing of diagnosing and fault finding was something that I did excel at and that is a matter of just breaking things down and working out process of elimination, really. If you have got a huge fire system of course, a massive factory, with a random fault in it you can just keep breaking the system down into half and then walk out where the fault is and then go to that half and split it again — you know, it is possible. And I think once you get the idea of how to find faults then really you can apply that to anything, and that’s something I had really try and teach my apprentices was, focus very much on the process not on the kind of particulars; if that makes sense. So you can then apply that skill to any system, whether you have seen it or not before — you can compare working parts with non-working parts and just work out where the fault lies. So yeah, that was something I enjoyed doing but it also meant I had more time on the road and a lot of people wouldn’t like that, but for me, if I had to go and help someone on an installation I would really notice actually being on site for ten, twelve hours, something like that, and then a little driving at the side of the day. I had noticed the difference really in the fact that I couldn’t listen to all my podcast in audio but a lot of sites now have banned earphones, so even doing that was impossible. So for years I have been doing the job that I could do and to be honest with you, I had got to the highest point I could without then going more office based or more managerial, and I kind of knew it was something I had always done and so I could do it easily but not necessarily something I always wanted to carry on doing. So I kind of consciously decided to plateau, I guess, and have that quite nice space in the fact that, I was entrusted and I did do a good job and I did the very best I could, but it allowed me to focus a lot of time or mental energy — at least — on other things — my real passions — and that was initially a lot of forex trading, and stocks and shares, crypto, and later I have got into property and that’s when I really found my true passion. So listening to business development podcasts and various audio books, I really started to kind of get an idea that that’s what I wanted to do and it certainly wasn’t going to be carrying on being an engineer, and I couldn’t see myself starting my own business in that field either because it’s quite a mature market and you have to start very small, you know, it would take a good ten years, I think, to start scaling in that industry I was in. So yeah, that’s where property really started to make a lot of send to me. Chris: So when did you first become interested in property then? Graham:  I have always been interested in property: definitely. I mean my dad certainly always was. And I made a big mistake and I bought my first home, it must have been around ’06/’07, I spend a lot of money doing (it out). And then we just moved to Nottingham, we weren’t that familiar with the areas and it turned out to not be a great area and we weren’t very there at all. And we put it on the market and the end we just wanted to get out of there, I mean I briefly consider renting it out but we just wanted to wipe our hands off it, so we sold it for a loss. And then went into renting, supposedly just for six months. And five years, I am (certain), I think (the one after), you know, trying to kick myself away from what the value would have been, what my mortgage would have been if I had put tenants in. So it did turn out to be a really good thing and they do say everything for a reason and certainly I won’t be where I am or living where I am now if I hadn’t made that decision but yeah, in the end it was six years of being in rented — which initially, you know, it was very nice, but once we had started a family and we wanted to settle and I only wanted to focus on the business, it didn’t make much sense. The actual trigger for really deciding to become a property investor and focus some more time on that space was… I guess was really be committed to being a successful-professional forex trader and I was spending a lot of time on self-discipline, on proper strategy — that was my root financial freedom, as I thought. But also the guy, my mentor, the guy that I was learning from, he was maybe thirty-six/thirty-seven, gone fully grey from the stress, sitting in front of six PC monitors for twelve hours a day — you know, it would be a Sunday afternoon; his family would be out, having a barbecue he would be preparing for the markets to open the next day. And I am starting to think, you know, I am not really sure this is the future kind of future I want. And my wife asked me a funny question — she was reading some book — and she said; “what is it you are doing when you lose track of time, because that’s where your true passion is?” And I didn’t much over it, I was just thinking yeah, forex, but only when I am winning, when I am not I am kind of getting up at 01:00 AM to check the yen against the dollar and you know it wasn’t healthy. So we got offered single buy to let property, and at the time I didn’t know about property education, I didn’t know about the courses, and didn’t know a lot really. However, I knew it was something that we wanted to do and we were still at the time, so I was a strange. When I spoke to the broker he said well, there is not many people that don’t own their own home already and they are trying to get into buy to let, in fact, there was only two lenders that would even consider us — Natwest being the one that we went with. And yeah we got offered buy to let, and that was, I nearly bought a dud actually, my whole strategy was going to be buying twenty percent below market value — I think I might have heard something someone was doing — and my way of doing that was going to be finding what had been on Rightmove for the very longest and of course I had been the most desperate, so I am more likely to accept an offer. And I thought I had found a gem and I would start to hold it up in my head that I was going to be buying it at a twenty percent below, I didn’t even consider that you might not want to go for that. But my main concern was why I hadn’t been on the market so long, I really thought it was a Call KA, and you know, I had accepted at face value what the agent was telling me for rental figures. And yeah, I was just putting up the word about, you know, I was speaking to people saying, look, I am going to be going into property, I want to get a buy to let. And having that random conversation with someone he said to me, very randomly, I think there is something going on at Trent bridge cricket ground at the business centre there, I think it was a property event on tonight, you ought to pop along. So I went down to that — and I guess technically that was my first property meeting — but it was out on by state agents and really they were just talking about the state of the property market — this was 2015 — and I found it very interesting. And I just reached out to a guy, he was in a suit, and I said, I am looking at getting into property — I have seen a property I think it’s call KA, I am not sure entirely why it’s still in the market. He said, “you know what, I love looking at property, (focus on viewing), and I am just going to come down and join you, you know, I will just do that”. It really was a nice thing for him to do. And he came down, and he pointed out a lot of defects. And a year later, I found all his notes that he had given me and he was absolutely right and everything he was saying was just… I understand why I would have done very badly if I had went for that. So, well forwards, we got a different property: bought well. And we got quite lucky, we bought one that was (Hecks) house and association, and it was just a matter of treating a state agent professionally as potential business partners almost, if you are buying property you are going into business with that person, so having respect for conversations with them and also involving the when you are doing viewings. And I was doing that and I think we had already kind of made enough to own a place because I am naturally (knee jerk) because of them, and then I thought hang on, let’s just see what else is out there, we went for another viewing, mentioned the (impulse) that we were scaling up and we were going to be buying our portfolio, just telling the agent everything they needed to hear. To then say, I might have something you are going to be interested in, it’s not gone on the market yet but we have just put the sign on the outside and the neighbours asked for a viewing, I am going there now and I said, “I am coming with you.” It was great, (Hecks) housing and association. Fuchsia pink all over. It hasn’t been touched since the seventies, and yeah, very good price. So we had the agreement and principle done, we had the deposit proof of funds on the desk of the agent by 09:00 AM that next morning, they couldn’t really go to market with t at that point, so we didn’t have to complete. And as I understand it was about two hundred investors that are after this (Hecks) housing and association properties, where they are offloading their old stock and buying newer stuff, and so we were very lucky there. So yeah, well forwards, it took a while to get through conveyancing, throughout that whole time I was on eBay and I had gone through every night and buying stuff that I thought I would need for the renovation. I was an engineer, I had a big van, I had tools, and we had the company van as well, so it meant we could quickly — if we sort of (bargain) — go and get stuff. I think the best part was we got a brand new bathroom suite from B&Q, it was the guy that bought it, left it in the garage, didn’t need it. Put it on eBay with a spelling mistake and we got the whole lot for thirteen pound, just amazing. The next first thing we got a second hand kitchen, but it was a high-end kitchen, with grounded worktops, appliances included — that cost £250. And then we sold the old one which was horrible, 1970’a kitchen; we just though you know what, we will try it on Gumtree for a hundred pound, someone bought it. And then we are just going to use it in the garage, you know, art studio, and for them it was perfect. So net it was a hundred and fifty pound grounded worktop kitchen. But at the time I knew, I had no concept of leverage or anything like that, I did all the work myself, so I was working every day and then going to the property at night, working from 05:00/06:00 PM till 10:00 or 11:00 PM — annoying the neighbours — and yeah, it was hard gruelling work. Chris: Was it annoying the neighbours who wanted to buy the property? Graham:  Maybe that’s why they gave me such a hard time. Chris: Possibly. Graham:  No, I was pretty respectful, but it was hard work, and I would probably age myself five years during that process. I got to the point where I was actually resenting the property, I was going in and just feeling empty; it was horrible. My wife thankfully… I just wanted to sell it, it wasn’t even ready and I said look, let’s just put it on the market I have had enough. And we had an agent man that said look, you at ninety-nine percent, just finish it and then we would value it properly. And my wife said look, you didn’t do this to sell it and really after legals, forget home under the armour, when you look at what you are going to make after everything, even though we had only spent maybe four grand (£4,000) and had done everything, and we have made a very nice home for someone. We won’t have made much money at all, it certainly wasn’t worth all that effort I had gone through, and she said look, this isn’t why you did this, it was to start in your property journey so let’s just it, find a tenant. So thankfully we did that, it took us two months, we were very (fassy), more (fassy) than we needed to be, but of course it was our precious first ever property. Chris: Absolutely. Graham:  So we got a couple of teachers and then we went for a year. That was nice actually. And after that whole endeavour, I had totally had enough of properties though, we got tenants in and I was like forget about that for at least a year, let’s see what happens to the market and I will start thinking about it; the (tiling) for next year. And that was my time to really then start getting into forex and really double down and focus very hard. The biggest thing I have got out of that was the self-discipline. My mentor, he did meditate before even looking at any charts in the morning, he was very, very disciplined and focused and so I really kind of started to develop that side of myself, which I had never known before — to be honest with you — and that was really useful. So I was really trying hard to be a very successful forex trader, and I wasn’t losing a lot to be honest with you but I was really trying to hone my skill before putting any significant amount of money in, but whether you are twenty pounds down or twenty grand (£20,000) down, I think once the emotions kick in they are very, very dangerous. So I was just learning to try and separate decision making from emotions. And I think the truth is I wasn’t really enjoying it and my wife asked e the question of; where do you lose track of time the most? And I wanted to answer forex but I didn’t really know the answer. Coincidentally, that night I had seen on meetup.com, a weird thing I had never heard of before, it said property networking event — I was like not really so interested in that but I am quite interested in listening to the guy that retired in his early thirties using other people’s money. I thought well, he is either a corny man or he has got something that I could learn, so let’s go and hear him. And I would never forget, I said to my wife, you know what, it says networking from 09:00, I will be home just after 09:00, I am not interested in all of that. And I went along and it was quite a forced thing, there was the ringing of bell every couple of minutes and making you go and talk to someone else. Chris: Be networking… Graham:  I had never known anything like it, and you know what, I met some really good people, some people that hadn’t gone into property, so I had advice to offer them and people that had been in it twenty years and twenty plus properties, and I loved it, I absolutely loved it. I met some good people, I met a plumber that I was getting on really well with him and you know people have been on these courses and I was arguing with them, you know; why would you do that. When that can be out towards a deposit and they were arguing with me saying well, how long I it going to take you to save another deposit before you can buy another property. And that’s how far detached I was with being a real property investor. But the guy, you know what, the guy spoke — he was good — I wanted to say hi to him, there was a couple of people I wanted to follow up conversation with, afterwards. 11:00 PM we were getting kicked out of the bar, at 11:30 PM we were still kind of raveting on — to be honest with you. And I was really energized, I was buzzing, and I went home and say, I know where my true passion is, I lost track of time and I could have talked all night with those guys, though I have never met before and it was all around property. And I really knew my passion from there on, and in fact, this is it, this is what I am going to be doing, and it was very nice to have that kind of inspiration, if you like. Chris: Yeah, definitely. So you kind of find your direction and in terms of property; and what was it really that attracted you to SA, you know, how did you go from this point where you go right this is what I want to do to actually establishing Serviced Accommodation, would sit you write well? Graham:  There was a guy that actually was doing a thing called Serviced Accommodation, not really heard of but I have heard of Airbnb, so I kind of understood it. We have been doing Airbnb from our spare room at times, it wasn’t something we enjoyed doing, but my grew up in a guest in New York and so for her it was always kind of a dream to go back to that, whereas for me that was just a nightmare that I do lots of strangers in your home and I was just not ever enjoying that, whereas Airbnb can be a bit more picky and choosy, enquiry only, for example, I was travelling a lot for work so we did have women only if we let it out at all while I was away. And so I was exposed to that and then I had met a guy that was doing it more professionally, I just assumed with his own property. And I was aware of this thing that everyone at the time was doing rent-to-rent and HMOs, and it was quite funny actually because I had heard about that when it first… Well, when I first heard about it, it was getting going in London quite big and it was around 2013, and my mind-set is to show mind-set shift, at the time I just thought I went on too late, these people are already doing that, you have to be the first, otherwise, no point. And that’s where my head was out at the time. And a while forwards, years and years, and everyone is talking about rent-to-rent, I am like oh yeah I know what that is. And I don’t really know, I don’t know if it’s arrogant, but I thought I had a brainwave, I thought I had a really good idea that no one else had had, what about if you combine these two strategies: rent-to-rent, but instead of putting HMOs, what about rent-to-rent for Serviced Apartments. And I spoke to someone, I then got to go another couple of networking events and I said to someone, oh I have got this idea and they kind of laughed at me, and they went yeah that’s what everyone is looking to do, I was like oh okay, cool, cool, cool. So that was it. I will go back to an agent I met — the guy who first helped me out with that property I nearly bought — me and him kept in touch, I involved him in the buying of the successful purchase and the renovation, in fact, I invited him around when it was complete so I could show him everything and also he had me help him. He had a couple of offices and I did security lamp, CCTV, that kind of thing, so we got a business relationship going on and so that was good and keeping in touch, and we enjoyed each other’s company. I do remember being at one of his offices and doing a repair, and (seeding) of the Serviced Accommodation thing, I said have you heard of this thing that people are doing and he said that sounds similar to the corporate lets, but you know that sublettings are kind of not allowed and it’s definitely frowned upon, I said oh yeah, I know. But I didn’t really move it forwards from there. Well forwards many months and I get a phone call from him, I was his go to guy I guess and looking back — having now read Daniel Priestley’s book –his key person of influence within anything that was technical. And he had just acquired a block of apartments, just four apartments, and he was going to be giving the block management. And he asked me, he phoned me up, and he said look; what’s going to be my requirement for fire safety? And I said what have you got? And he explained. And I said you know what, it would be easier if I come down and meet you in person. Chris: Of course it will be. I’ll have a look! Graham:  Yeah, brand new renovation in a listed building, not in the market yet, four high-end one bed apartment. I thought yeah, you know what, I am going to pop down. So I went down in the afternoon and I had a look round and it really was stunning — very, very nice, oak everywhere, massive windows; very, very central in Nottingham; fantastic location, and yeah the place was stunning. And I said to him you know what, I am interested. And he said “what do you mean?” Is everything alright Graham? If you didn’t split up with your wife, why do you want a one-bed flat in the centre of the town? I said no, no, no, I am interested in taking the block. And so he kind of looked at me and he… I was a little bit gone out to be honest with you; to let you know no offence, eighteen months ago you were about to buy your first dod property; and now this? I was like yeah, you know, Serviced Accommodation; do remember that thing I was telling you about? So he was the first challenge, to honest with you, and my knee-jack thing was to phone that guy I had met at that very first networking event that was doing that thing called Serviced Accommodation, and he very quickly recognized it as a good opportunity and was right in my house that night. And actually we met with the agent quite quickly afterwards and you know what, he did a very, very good job of… He had been on the courses, he knew what he was doing and it just was getting going and he is very, very prepared, and he did a perfect job of convincing the agent that it was first of all a legitimate thing to be doing with the building but second of all, it was actually the better thing to be doing with that property, it would have worked better as SA a it would have worked under AST, which the owners were looking at. So that was fantastic, you know, the idea was to be doing some form of JV, it didn’t end up working out mostly because the guy really had to focus on his own properties which was quite a sensible thing and that was he advice he had received at the time from his mentor. Now, I also saw the importance of having a mentor, and I wasn’t sure about doing the course, so I bypassed doing the course and I actually reached out to Mark Stokes — at the time he was quite heavily involved in Serviced Accommodation — and I said to him; would you mind mentoring me on the side? And from there that was very useful and I was getting to learn a lot. And the way I have always been is I do real deep dive in any subject. I would never forget; I wanted  to buy s mountain bike, I had spent three months researching, I had to know about every single component, every single (back) on the market, the price points, the pros and cons, everything — and that’s just how I am, and of course then started my journey into Serviced Accommodation really. And it was a bit of a blessing really, the owners weren’t too interested, they (popped) some cash in this big block and their main focus was on their business which needed their attention, so nothing was happening for months actually; however, the agent was fully on board and was representing us, he was the guy selling it to the owners, not us — and so that was very, very useful. Well forwards, I was probably at risk of being the most qualified bystander in all of Serviced Accommodation in the UK and every day I was working towards it, no matter what; whether it was researching, or testing software, or reading books, and I was really focused on business development, I wasn’t using this as a property strategy. And I think, looking back now that was a sensible thing to do and I think that’s possibly not what everyone in the space has done — they have got their single lets, they have got their HMOs, and then they have jumped into Serviced Accommodation as the next best thing to do. And possibly some people might not have the right mind-set around everything when taking that journey; whereas, I was very much focused on, okay we are going to be starting a business here; how do we do this successfully. And yeah, I was using the time very wisely but it took a very long time before we finally got that call the agents saying, “make yourself available 08:00 AM next week.” And Mark was kind enough to join me but it was like Alan Sugar’s boardroom and talking some very big successful guys about (capital allowances), it was a little but intimidating, so I was glad to have a partner by my side. And long story short, we got the block — they didn’t trust us — we had proper business plans and everything, we have done a lot work towards it and they could recognize that. Equally, I recognize that we were taking a chance, we really were. We hit the ground running, we opened up and we were prepared and did everything right, and very quickly we were getting very good reviews and getting a good turnover. And we got offered quite quickly — by the guy we nearly did a JV with — another property. Chris: Yeah, I did say what’s quite interesting there was these three key events which kind of happened prior to getting going which some people would call luck, but I think if you examine closely, it’s not really luck at all, it’s kind of point yourself out there and being in the right place at the right time. The first of all was being saved from buying the (dead, few at first) buy to let property. And you could say yeah, it stroke a lot but at the same time if you hadn’t been in that network building, if you hadn’t put yourself out there you wouldn’t meet the person that you then come along and say, actual you need to worry about this. Similarly with the agent who kind of brought you your first single let property, it was kind of lucky, but again if you hadn’t been there, if you hadn’t been putting yourself out there, talking to the agents, being in that position with then when they said oh yeah, I got this one, you know, you might be interested in, then it would happen. And very similarly with when the block came through; exactly the same situation, if you hadn’t been building that relationship, maintaining that relationship with that person over time then it just never would have come through, really. And I think it just highlights the importance in property, it’s a cliché to say but it’s completely a people business; isn’t it. Graham:  One hundred percent, yeah. Chris: You know it’s not about (a person motto) at all, it’s completely about people. Graham:  Yeah, a hundred percent. Even we didn’t talk about tenants but a big part of my success was is having really good tenants and looking after them. So yeah, it’s definitely a people business. Chris: Yeah, absolutely. So when you kind of started out then, what was this thing that you struggled with the most — do you think? Graham:  Initially, when I was still working, my hand was fun… Chris: Struggle when you were running full properties. Graham:  Full properties and a full time job which was very demanding, there were long-long hours, I was doing sometimes eighty hours a week. A lot of those hours where on the road, I could make phone calls, but my hand was forced quite quickly to get help, so, it was a struggle but it was also what I needed, it was a kind of blessing really. Chris: One of those blessings in disguise is what it’s like because you can’t do everything yourself, you are then forced to kind of leverage early; right. Graham:  Absolutely. So I found a UK based VA, and I was struggling to find one. Again, my wife was instrumental in helping me find my first VA. And she persuaded me to reach out to a contact in London who was growing a multi-million pound, massive, very successful business. And she said, “why don’t you ask Lauren?” And I said well, we are at very different places, I am not really sure he is the best person to ask. But you know what I did; and he said my very-very best PA has left, very annoyingly she has left to have a baby and she has now had a baby and is wanting to start working from home which I can’t do, I need someone in the office in London; and so why don’t I connect you. And I said, thank you very much. And so that was Emma, so Emma joined us very-very early, initially just for a few hours a week, and it was research and it was this and it was that, and quite quickly I got her trained up on some of the software we were using, and it became a more regular position for her, and she enjoyed it. And it was something different for her — she had always been a PA — PA’s are fantastic at organizing things. However, she always wanted to double check everything, which was fine, you know, I was available in the phone most of the time, so having that job and being able to do it quite easily because I had always done it, allowed me to have the mental capacity to say well do this, now do that, and I almost micromanaged but it meant I had someone there available — and that went very well. So that was that was the struggle. I am trying to think of something else but that was probably the main thing at the time. Absolutely. Chris: Yeah, because I mean you were quite well prepared. I love that phrase: “the most qualified bystander” and all of those accommodation. Because you basically spend about a year working on that deal before it came to a (finish). Graham:  Probably a good nine months. And really towards the end actually, certainly by the time mentor, I mean during that process as well we actually bought our first home, so that was going on, I renovated that, I had learned the concepts of leverage and using other people’s time while I was going off at doing what I was good at. And also we had got our second buy to let as well by refinancing the first one with the added value. So by doing all that work myself in the first place, it did build in the value, and so, looking back it was the right thing to do but it’s not something — I am not sure — I would like to do it again, if I am honest. Chris: So the three stages that we talk about like start, systemize, scale, so you obviously got started, it sounds like very early on you had to start leveraging and to leverage you really need the systems in place; don’t you? Graham:  Yeah. Chris: That was absolutely key if you are going to be working with other people, you are not just handing responsibility over to someone, you are putting the systems in place, you are plugging the right people into those systems and then you are kind of monitoring their performance on them. So at what point did you then start scaling the business from these four guaranteed rent properties you have taken on? Graham:  Well, very-very quickly actually, the guy that we nearly did the JV with, he introduced me to a landlord, at the time he was at full capacity himself and this other landlord he needed some investment in the property, he needed furnishing and decorating — nothing too major — but he didn’t have any. And it was his first buy to let, he was a London investor and he had had experience with Serviced Accommodation, so he knew what he wanted to do, and he needed help bringing it to standards which we were in a position to do. However, my whole conversation was around how much rent do you want, and he just didn’t want to do that. So he wanted the reward from Serviced Accommodation, that’s why he wanted to do Serviced Accommodation. So really, we ended up doing management for him, and looking back we did actually set it up perfectly, he was an accountant by trade anyway, and it was a very simple management contract. But yeah with the gentleman’s agreement on the side, you know, of a zero percent loan, so you get going, so that loan was going to get paid back from the income of running it as a Serviced Apartment. Chris: And what party was that to, was that from you to him to get it going or…? Graham:  Yes. Chris: Okay, cool. Graham:  And so, it was very quickly, we were adding some portfolio, I think that was within the first couple of months. In fact, I think we had only just gone live when I first met him, I remember him coming, I did an introduction and showed him around our first block, and we had literally just furnished it and started getting guests at that point, so it was very-very early, we were adding to it. So very quickly, I recognised the importance of systemizing and I knew that was going to be essential. I have got another friend who was local to me in Nottingham, who was growing a very-very successful business completely separate, they are coders, they are in the games industry. But he put a book unto me, The E-myth. For him, as a developer, it’s what he needed to stop developing and look at the high picture, and look at the chaos around him, and starts putting things in order, and from there that’s when his business started getting successful. So he said to me right from the get go, read this book and follow it — and really if you have not read it, it’s about really the franchise model and looking at what’s good about that, lost franchises succeed, most small businesses fail, and the main difference is the fact that franchises are systemized, you are buying a system and that is a set of instructions really. And if you are to break your business down and everything you do in that down into a set of instructions, then you can start to then give those instructions to others. And so I had to do that very early, I had no choice. And that’s where we started to really build our own systems and processes and found our way of doing it. I had someone build me a flow diagram, I showed them everything I was doing, and they build me a flow diagram of — we called it guest work flow — and from initial enquiry all the way through to check out. And you know what, there were so many kind ifs and buts, you know, if it was an Airbnb, can we do this; and if it was a high value (booking), can we do that — and there was a lot of variables. And I also very quickly realized the flow diagram was not the best way of doing it. For example, if a guest and we have to 4.1 in the flow diagram and then no action to take for three months, you know, how are you going to record where they are on that journey and trigger the next action? And so we looked at alternatives and that’s where, really, I started to build something and teach it to Emma and have her run it for me. And so yeah, that was how we got going for the whole systemization. Chris: That’s cool. I think when we started working together; do you remember you have the four properties on the block plus one on the management, and you were going a bit crazy at that point looking (at those) different stuff, where you going to have a look at a hotel when we first had our meeting? Graham:  Yeah. I got to know a property sourcer who is based in Manchester and he had a contact that was struggling with a very small boutique hotel, near Manchester airport. And, I thought yeah, you know; why not? Chris: In fact, it’s a couple of hours journey, yeah, whatever. Graham:  Yeah, sort of that. Don’t worry. He was quite local too, where it was located, and it would have had an office space which was what he needed — so he was going to be my guy on the ground. So there was some logic around it, like teach him the systems and the processes, and actually I was going to be sharing the management with him, and there was that, but also I had started to speak to some large property investors around my area in Nottingham. And one of them had muted the idea of just testing market with twenty-five studio apartments. And so, I was like okay, I need a mentor because my time with Mark is always going to be just three months — that was just to help kick-start me — and that was months previous really. And so at the time I was then thinking I need a mentor. And so, I was just thinking, okay, I need to say yes to everything but I don’t know how I am going to do it; we have got systems but they are not ready for this amount of scale — we can’t go from five to thirty apartments in one hotel. One of which was in Manchester. So I reached out to Chris after listening to the podcast and after hearing him advocate management which by the way really started to recognize the benefits of that. Because everything we were doing was scalable, our systems were scalable, our processes were scalable. But also, I had been advised against taking the block because it was a big risk to take on the liability — you know, for me and my wage, it was more than what I was earning, so if it didn’t work, it was going to be very-very costly, especially after buying my own property. So I did recognize that that sort of things was not scalable. And so management landed in my lap, if you like, and from there I recognized it as being a much more scalable strategy. Yes, we (are making) less per property of course, but yes it was scalable. So my mind was on that, I then was listening to this podcast and I heard about how great management was from you, Chris, I remember I reached out to you and said look, I have ended up doing management and I would like to learn a bit more about it, and also I am not sure I am going to kind of take on all these new properties that are coming my way. So I still remember, it was here in Heathrow actually, first ever board room session with other operators. And the advice was quite strong, Manchester does not sound like a good idea at all. And there was a few red flags around it, which I was maybe glancing over. Chris: Yeah. The key one I remember was that the guy who was still going to be living on site and that to me sounds like an absolute nightmare because when you do management, there is got to be a real clear distinction, what the roles are and who is doing what. If your person is still living on site, then clearly you are going to get involved and basically with everything that you are doing, so that was the biggest one for me. But there are some other ones around it, (not a list of all) like I say, Nottingham to Manchester is not a short journey, it’s not very close and having had experience running hotel before, it’s not very much fun. You are going have to be doing quite a lot of work around it, very hands-on, even hands-off hotels were remarkably hands-on, so there is a lot of stuff to do around there. So I think that was kind of clear, kind of realigning of focus a little bit and obviously you realize that scaling up using the management model was going to be the way to go for you. Now, generally, the challenge with management is… Although the model works brilliantly for you, as a management business; it works brilliantly for like an operator, developer, landlord — at the same time it’s a lot harder to kind of come across the deal; isn’t it. Because you are having to push people a lot out  of their comfort zone to kind of understand how it works, compared to; oh yeah just give me this and that rent each month. Instead of saying well, I am going to manage it for you, it can go up, it can go down, you are probably going to make more money, but at the same time you are then going to be the actual operator, so you have got some liability around that etcetera. Well, like I say that the management model is brilliant, the challenge most people have with scaling that up is; where do I find my clients? So how have you found your clients as you have scaled up the management model? Graham:  Well, it was actually a long while, so although we went from four to five very quickly, going beyond five took a long time and it was — I am trying to think really — it was a random comment on one of the Facebook groups, and it was an operator in London asking for cleaners in Nottingham. And so I reached out then I just asked how I could help, and they explained that they were actually trying to help someone else that was doing rent to rent in Nottingham. And so that’s how I got introduced to another London investor, this time instead of buying property in Nottingham he was renting property in Nottingham to run serviced accommodation. So I met him and he had actually been using another agent and they already had one property of his and then he acquired a second property –giving them the keys — and it had taken a month for not much had happened and he was getting frustrated. He met me on the Saturday, on the Monday we had contracts drawn up and signed, and by Friday we were furnished and live, and Saturday night we got out first guest, so he was very-very happy with that. Chris: No messing around then. Graham:  That’s it just kind of being ready to just absolutely hit the ground running, you know, and I guess that’s where having systems really helps as well; step one do this, step two do that. To be fair, the on boarding process — as I call it — was chaotic, but everything else was just what we were already doing, so that bit was quite easy. It came naturally and I also had people that could do that and I could focus on the on boarding. But yeah, in my mind, probably a bit more chaotic that it should have been and it’s a bit like oh yeah we need to do that definitely. So I was already thinking this needs systemizing. But from there we got to know another operator who was also using another agent, the same other agent, and yeah, they weren’t doing the very best job actually and although they have been growing for about a year on a block of apartments, the actual owner of the apartments haven’t really made much money. And the difference in the way that we structured, you know, complete transparency, and almost an open policy versus the setup he had, it looked like a breath of fresh air. Furthermore, the owner, he was a developer, he wanted to focus on development, he had a team in place to help with the development, although he had given the block to a management agency. A lot of his resources and time was continued to be used on looking after his block, and it’s because the agency was in a completely different part of the country, trying to manage something in Nottingham. Chris: And that’s a fundamental issue with the national management companies; isn’t it? It’s actually very hard to have people on the ground and to have the same level of local knowledge with a local business. Graham:  Yeah, a hundred percent. So issues with cleaner, you need to find a new cleaner (please). You know, light bulbs going in the bedroom, a cleaner can’t reach; do you want us to send the call-out engineer, a hundred and forty pounds, or do you want to go down and sort tell light bulb and you know, it just comes through things like that. And then with the potential, I would say, just lack of clarity around other things as well. I guess my introduction to him was a breath of fresh air for him and it was just what we needed as well, I was already kind of getting to the point where it was going to be handing my (notice in) at work. And so, it all happened together to be honest with you, we went from six properties to me handing in my (notice in) and on boarding another seven properties and it all happened very quickly. From there we also got the second property from the first guy as well. So yeah we were then really putting our systems to the test and on boarding more staff at that point as well, we had separated out the companies of course — operations with the first block and management — and that happened quite a bit earlier actually. Chris: You mentioned like creating your job there, so that was something you have been putting off for a while; what impact do you think that had on your growth? Graham:  Yeah, massive. And I think it changed from; can I do everything? To should I be doing everything? So yes, I could do everything, I could have a full time job but I was at work for twelve to fourteen hours a day and run as successful business because of having the help and people, the very-very good people. Emma by now, by the way you know she had come on to working six hours per day, I think at that point, and she was a very-very high standard, high calibre. Initially her only weakness wasn’t really a weakness, it’s where she has always been a PA and she just want to double check things  and that’s what being a PA is; should I do this, should I do that? And entrusted her, I said look, this is your thing. And I guess for me, going back to the whole fault finding, when things went wrong it wasn’t a matter of like whose fault was it, it was more like well, which bit of this system is broken, and how can we stop that happening again. Chris: I think that’s really critical. Most people when something goes wrong they inclination is to kind of blame someone. My first question is; what didn’t we do which would have stopped this from happening? As opposed to it’s this person’s fault. So if you have a cleaner that doesn’t turn up at your property, for instance, to create that massive problem in an SA business — now, most people turn on to blame the cleaner and go… Graham:  Well, we had it happen. Chris: Yeah, absolutely, and that’s the thing. The correct response to that is okay; what haven’t I done which would have stopped this from happening and it might be that you didn’t have clear enough communication around, when you didn’t give the assistance to make it very-very easy, to see exactly what it is, you didn’t have the confirmations in place so that you knew a hundred percent that they knew about it etcetera. And it’s a very different response, of course, in way that’s kind of a natural because that kind of human nature just wanting to blame someone straight away. But once you kind of take that step back and start looking at things like that, you start developing your business very quickly; don’t you. Graham:  You have got to take responsibility and that’s it, it’s your business, it’s your responsibility, and it’s your fault if something goes wrong like maybe it’s the wrong person role but… Chris: But you appointed them in that role. Graham:  Who appointed them? Chris: It’s definitely your mistake. Graham:  Have you given them clear instructions then ask them to follow them and have they gone against those. And if they have gone against them, is it because you haven’t trained them well enough. So it might be the person but most of the time it’s not, actually. You know, that cleaner that did forget a second time as well, and that’s ends being a (full wave) onto the guest and moving yet if you can; it’s really embarrassing. But yeah we have got much more solid systems around the turnarounds now, things cannot get missed, and if it looks like they may have been missed, we have got four hours warning and everyone in the company is getting alerted to the fact that maybe we have got a cleaner that is not of the cleaning today. And so it’s very-very… Good systems we have got around that and those only come off the back of something going wrong, otherwise we would have just carried on, we (are) just letting them know when their cleans were, without any feedback knowing that they were aware of the cleaning the first place and knowing that they (off from) site. Chris: Yeah, I think that kind of feedback in the business is critical, whether it’s things going wrong, whether it’s listening to your guests, listening to your staff as well, of course, but that feedback is critical to really grow and improve your businesses into. Graham:  Yeah, absolutely. Chris: There is one thing I just wanted to pick up there. And with management you have really got two kind of different (avatars): one is focusing on people within — you might call it the property education community, the people who are kind of active and involved in what we are doing like this — and the other is people who are more kind of traditional landlords and developers. Now, how will your clients spot between those two and how do you find those two different (avatars) to work with? Graham:  Actually, I think the first avatar, as you call it, the guys that are in the industry already, that’s word of mouth, people get to know. And that developer that moved over to us he did a lot of due diligence with us and I think people really trusted him and of course then got his feedback as well — we had done a good job and that did reach other people. And actually coincidentally, that first guy that I was going to be doing a JV with ended up being one of our clients, it was great for us and it was great for him. And that’s what real business is about, it’s creating win wins, and Serviced Accommodation is a win, win, it can be a win for the property owner, a win for the guests — getting much nice accommodation than hotels — and it’s a win for us, as much more it can be a much better cash flow strategy. And that for me is a real win, win and that’s where real business is. And so creating ways for other operators to come to us, to leverage our systems and our team, to then really help them kind of focused on what they want to do — whether it is acquiring more Serviced Apartments or focusing their other businesses or their other property strategies — really by enabling that connection to happen and finding a way that it really will be to the true mutual benefit, that’s where we have grown a lot to be honest with you. So we have had four, I guess… Other operators join us now as clients, which is great. Yeah, working with the landlords is… We don’t really do any marketing, I mean we are getting a big and better name for ourselves now, and so we are becoming the kind of go to guys within Nottingham. So it’s much more about personal connections rather than random marketing to be honest with you. Chris: Yeah. And what has been your experience with the developer market; has that been something hard to break into? Graham:  Yes. Quite often because a lot of developers in Nottingham are building to sell right now, and you can’t blame them with the (passes) they have been getting, and actually if they are building to keep, they are then looking to refinance off the back of that and so it’s more difficult to then convince there lenders that Serviced Accommodation is a legitimate way of kind of having this work. And you see, because we are not offering any sort of guaranteed rents to developers, they really then kind of struggle. So yes, it needs much bigger developers to be honest with you; who don’t need to finance out of the back of each deal and can park some cash, or have got better and bigger relationships with lenders. Chris: Yeah. And if my understanding is right, so you haven’t done any deals with developers outside the property education community, so far, but you have been working on these relationships for a few years now and you have got stuff now coming up the pipeline; is that right. Graham:  Yeah, absolutely. We have got two blocks of sixteen apartments in different areas of the city. Chris: That’s sixteen each block. Graham:  Sixteen each. Yes. And we have got another block coming, it’s really early days but it will be a block of twenty-eight, we will get first (refuse) the number of apartments we would want to take in that block — and again, at a completely different part of the city. And so I think we will definitely be taking fourteen there because of the way he building is split, but we are going to be able to adjust the market there and potentially take more from that point as well, even if some go to (YST). But those relationships take a long time and I think developers will tell you their deals take a long time, a lot longer than they anticipate as well. So whether that’s the acquisition, the legals, or the kind of planning process, or even getting contract as on site to then finishing the site. Everything takes much longer than anticipated. One of those blocks of sixteen was going to be ready before Christmas and it’s isn’t now, here we are in June, six months. So it’s just a couple of weeks away, so we will see on that one. Chris: So it sounds like the kind of process you have gone through scaling up, it has been working with other operators, helping local people who were already involved in SA, and then continuing those relationships of course. But starting to build the relationships with the developers, which is really going to then escalate and take the growth to another level, you know, if you are taking on blocks of sixteen to twenty-eight at a time, as opposed to maybe individual properties at blocks of four/five, that type of thing. Graham:  Yeah, absolutely.  But you see a lot of individual ones as well in much bigger blocks… Chris: More issues around it, isn’t it. (Free holes), neighbours, etcetera. Graham:  Access. And look it is where we are very much found above board and everything is being done right and so, if you are not meant to do it in a big block then just don’t do it, it’s not really worth it. Chris: There enough places out there which you can do it legitimately and it’s not worth the time, or effort, or money, which you are essentially going to waste if someone turns around and says, you can’t do this right. Graham:  Yeah. And look (Riggs) are coming, (Access Riggs) are going to be getting tightened up and you have got to be prepared for that. And I think doing SA where it’s not really allowed is going to be one of the first areas of attention from the authority, so it’s just not worth it. Chris: Brilliant. So you have kind of taken us through the whole journey and show people how you scaled up, which I think would be really useful for people to hear. So what would you say was the most important elements to start scaling successfully? Graham:  Definitely the systems and processes. I mean we were absolutely over (queue), initially, on our processes and our systems. I mean I remember showing someone and he said, “well, you have just got five properties and you are doing all that.” And it’s like yes, but this will handle fifty easily without even thinking twice, and really we just need to plug the staff in. And that really is breaking everything down into like, step one do this, step two do that. And all those variables and having that system in place where we have got accountability within it, we know who has done well and when, so if there was something that’s going wrong, we can go back and just have a look again at the training and so on and so forth. But also if we need to slot more staff in, we have systemized the training now as well, and so we can just add people, (as in when). Emma, she is ops manager now, so she is absolutely full time, plus, plus. Chris: But you say she is ops manager but kind of really, she is more of, almost, general manager (to help you out); isn’t she. She is kind of essentially running the business for you with some oversight from you I would say. Graham:  Yes, certainly more recently. I think initially she came on full time as ops manager but I think… Chris: It’s a role which is developed often, I have been absolutely critical with having one person who has that kind of responsibility for overseeing; right. Graham:  Absolutely. Chris: And it kind of almost started as a PA role and then it evolved into an ops manager and now it has evolved into a kind of general manager. Graham:  Absolutely yeah. So she is handling all the girls: the coms assistants, the bookkeepers. Although I have got a relationship within, they know I am very open, an easy to speak to guy. You know there, I don’t have much to do, if I am to be honest with you. Chris: You are not their line manager. Graham:  I am not their line manager. I mean I have a very much instilled company values of team work and we are all equal. I have taken my cleaners out to dinner, multiple times. We wouldn’t have a successful business if it weren’t for the cleaners doing a very-very good job in turning up. Chris: And most people only appreciate that, when they do a bad job and they see the impact it has on the business. So, it is really-really important when the staff (going well), and to also appreciate the importance they have in the business and then reward that when that’s having it’s impact on what you are doing. Graham:  Yeah. So systems but also the team work, it has been essential. Emma has had, I have asked her what she wanted, and we have created the wall around her family life and requirements. So it meant that she is much happier in her role, she is being more responsibilities all the time, but she is rising to the challenge (at hand); the amount of money she can earn also rises with that. So it is a good thing to have. And really instilling in everyone that if they have got good suggestions, make them, and if it’s an improvement, we are going to implement it across the business. Chris: So kind of feeding on from that; what advice would you give to someone who is scaling up their business? Graham:  I don’t want to keep saying systemizing. Chris: You can keep saying systemizing, that’s absolutely fine. Graham:  Well, how do you systemize? I guess that’s the question. Chris: Yeah. Graham:  It’s teach someone. Even if you have got no one to teach, maybe do a screen recording on your laptop and read out the instructions of what you are doing. Because actually you will find those little bits in your head that you are just doing them without much thought, and maybe you have got three ways of doing the same thing, and it depends which day of the week and what mood you are in, as to the one you are doing. So actually; what criteria would you do this or do that. And when you really break it down, I would say do ten minute videos, I aim to do lots of ten minutes videos and then you can even get a VA off People Per Hour or such like and get them to write a set of instructions from that video. And that’s the start of the systemizing, that’s getting it out of your own head and putting it into a process, do this if that, and so on and so forth. And that’s absolutely essential because if you are going to add staff as you start scaling, they need to know what to do. And so you can then start identifying the higher value stuff and the lower value stuff. You know how Emma is being instructed to leave most of the comms and focus on the high value stuffs, so when we have got guests requesting a late check-out, it’s a science — you go to the cleaners, and you check their schedule, you check the next check-in, and you speak to the guest. And that’s a science where there was great management, maybe that’s a bit more of an art, and that’s high value. Chris: Art-science; isn’t it. Graham:  Yeah. And so that’s a high value task. So we wanted to be able to focus on that without keep getting distracted about having an extra hour in the apartment. Chris: I think when we look at how you have been able to scale up that quickly, I think it has been three elements really, and it’s again the things that we always all about when we talk about leverage it, putting systems in place — and you have clearly had those basically from day one — and getting the right team around it with the right culture and the right attitude, and tell following up with the accountability. And again, a lot of the accountability with what you are doing comes from the systems you have in place: using things like Slack where you can communicate easily with the team, you can also see if something hasn’t been done, if there is a problem, etcetera. So it’s getting all the three elements right, which has allowed you to scale quite quickly; isn’t it? Graham:  Absolutely. Yeah. Definitely. Chris: Brilliant. Well, hopefully that has been very useful for everyone and thank you for joining us today Graham. Graham:  It has been my pleasure. Thank you very much indeed. Chris: Cheers.   Don’t forget to subscribe to the podcast, to hear the latest on Serviced Accommodation. If you are looking to start systemize or scale your serviced accommodation business, visit www.thesapodcast.com to see how we could help you further.    

This episode is the the first of a series of interviews exploring how entrepreneurs scale up their serviced accommodation businesses. In this first episode Chris interviews Hitesh Mistry as he talks through the different ways to scale serviced accommodation businesses, and the ways he has personally done so with his own business. Hitesh is owner of Vision Lets who provide rooms with a difference: Modern, Bright and Clean. Hitesh runs Vision Lets with his wife and focusses a lot on the lifestyle that being a landlord gives, and the passive income it can bring.   Show Notes: The Serviced Accommodation Podcast is a show brought to you by Chris Poulter and Ritchie Mazivanhanga aimed at new and experienced property investors alike. With each show we help you Start, Systemise and Scale your Serviced Accommodation Business. If you would like to ask us a question or discuss anything in this episode, please join The Serviced Accommodation Podcast Community on Facebook, and ask away. To listen to more episodes or get more information go to www.thesapodcast.com. Find out more about Hitesh and Vision Lets at: http://visionlets.com/       Transcription: Chris: Hi, I am Chris. Hitesh: Hi, I am Hitesh. Chris: And welcome to the Serviced Accommodation podcast.   Chris: As you may have noticed, it is not Richie joining today, we have got our test results for our series on scaling up. So, we have been working Hitesh for a little while now and having been through the process of scaling up his business, and we thought it would be really interesting and useful (process) to talk about that painful process; right. So we are just going to have a kind of chat about the process you have been through, if there is any (parts) you can help people with — that kind of thing. So it would be really useful for everyone, just to start off with — to kind of under a bit more about you; who you are; where you are based; what you have kind of been through; and tell us your background career? Hitesh: Yeh nice one. Thank Chris. Thanks for inviting me today, I really appreciate that. I think when you said you have been working with me for a little while, a little bit longer than a little while. I think nearly around two years. Chris: Really! That long. Hitesh: Yeah, it’s been quite a long time and it’s definitely been a journey. I’ll tell you my background. It’s been a great journey though. Really hard. My background, I am actually a corporate person. I work for huge corporate conglomerate, global company, for ten years. I haven’t been a serial entrepreneur at all. Hitesh ordinary average guy, you know, just… Chris: That’s amazing. I find it hard to like envisage you in that whole corporate world. I guess the whole time I have known you, you have kind of been out of that you see. Hitesh: Yeah, exactly right. That’s exactly correct. But you know, I have done a lot of academic studying, I have went through the kind of traditional study modes, the university, I have got an MBA as well. So academically, I have really studied a lot, I have really always (sealed) myself in the kind of corporate world. But back in 2009, my wife and I, we started buying properties — our own properties — as buy to let. And that kind of got into the flavour of how we invested in property. And actually around 2004/2003… Sorry, 2013/2014, around there. Now we have we have get that decade… I started getting a little bit itchy in my corporate role and I was thinking, we have started building up a property portfolio, and the income we were getting was quite good. If you kind of called it this passive income whatever. And I really thought of, you know, if I can do it more in property, and left in the kind of corporate traditional job side of things, I know it’s a bit of cliché but I read that kind of “Rich Dad, Poor Dad” book. It really did flick on a lot of light in my mind actually. Chris: It might be a cliché but it genuinely does, kind of, I think the word is paradigm. I think it’s a great word, I don’t really understand it but certainly kind of, you can look at something and see it in a completely new light, and that’s certainly what it did for me. Because suddenly you will go, I can see the mistakes I am making, my money comes in and I spend it. Hitesh: Yes. Chris: In I just… The money comes in and I put even a fraction of that away to invest in assets and then start sending your money from that, that’s the wealth. It’s such a simple concept and yet so powerful; isn’t it? Hitesh: Really powerful. Really, really powerful. And really resonates very strongly enough for a while. And also, at that time, 2014, my son has been born and he is three years old. My wife was, in 2015, pregnant with my daughter. And I thought to myself, you know actually, in the first three years of my son’s life, actually… In fairness, because my job was a (field) based role, I generally have a lot of time and freedom to manage my own diary and my customers I was working with, so, I do get to spend quite a lot of time with him, probably more so than an average kind of person. But, I wanted more than that, I wanted to spend even more time with my son and my family, and I really saw property as a vehicle to do that. And those few things in my mind started to make me think perhaps I should leave my corporate job and go full time property and kind of just go through it and see what happens. Because another thing that I thought was that if I go through it, even if it doesn’t work out, I am young enough just to still go and get another job again. Very employable in that regard. So, if I don’t try that I might have a lot of regrets and that’s really my background and how I got into property. Chris: So what was it that kind of made you take the leap then — the final leap if you like, from the corporate world into the entrepreneurial world? Did you kind of have something (lined up); did you just go — I have got focus? Hitesh: I mean the property portfolio was supporting us, not obviously replacing the whole income (with me), but, it was a nice cushion. Chris: Yeah. So it was kind of a safety blanket, if you like. Whatever happens you would have some money coming in, at least enough to kind of live on. Even though it may be not as much as you used to; right. Hitesh: Absolutely. But even it was still a just in time because Kim, my wife, she was on maternity, so actually she was picking up a new kid. All of that was becoming — it was a bit of a risk, really. Chris: Particularly, because she is on maternity. Even that child too is on the way as well. Hitesh: Exactly. The cost are about to go through the roof. I kind of leave my job… Chris: So, was that something that Kim has always supported you in or was it kind of a battle? Because I think that a lot of people struggle with is that, you kind of start to come into this entrepreneurial world and you have a kind of mind-set around what you are doing. And if your partner doesn’t share that mind-set, it can be very hard to kind of communicate on the same level. So was that something that you struggled with or…? Hitesh: Yeah. I think Kim was — she was so supportive, like really supportive. You know, if you really feel that something you want you want to do, and it’s a dream, then go for it, I will fully support you — we will find a way of doing it. She really gave me that extra confidence to take that step (how) you want and really go through it. The other really interesting thing as I have always been involved with — personal development, and psychology, and mind-set, and believe (system), and things like that — being involved in practicing, and trying to improve myself, and make myself more accountable for man years. And I thought to myself, you know what, let’s just go through it, one way or another I will just make it work. Do you know what I mean? I think when you really are focused on something, like very focused, I think then you really do make it work. Especially, if you then say to yourself, you know; we needed to kind of live a good life as well. I don’t need more pressure but, it is true that… For me, I thought I didn’t think working and going major on property was going to work for me — that I just don’t think I would have the focus. I need to really, really, really focus in one thing only. Chris: Yeah. And I would say you are absolutely right. It’s very hard to really make something successful unless you have the focus around it. Certainly for years I have like two or three businesses, really. At least three businesses going on at any one time, and none of them really did (anything) because they didn’t get the full focus and attention that they needed to really start growth. So, now I completely understand that. When you went full time in property then; what were you focusing on that time; was it single let still? Hitesh: I went for the rent to rent HMO model. That’s what we went for. So we did setup our own HMO that we purchased, we just completed it, it was getting it to go live, so that was really exciting time. And then really focused it on rent to rent HMOs — that was what we focused on. Chris: Okay. So I guess that’s kind of natural progression, you bought an asset which is an HMO. You have kind of been through that process, seeing how it works. And so, you know what, I could benefit from a lot of these cash flow without a lot of our capital input by taking on rent to rent. Hitesh: Yeah. Definitely. Didn’t quite go very straight forward though, it took me seven months to get my first rent to rent HMO. Chris: Yeah, I am sure that’s quite a common path; isn’t it. Because here is an interesting thing, people think if they are going to and get, say, three properties. And you won one every two months and then after six months you are having three properties. But it took you seven months to get your first HMO, but, on rent to rent; how many did you get in the kind of six months or so after that? Hitesh: Yeah. Then they started to come through. (They first start to flow) through after that, until we got another four or five, quite quickly after that. Chris: So it’s amazing how that looks; isn’t it. And it is kind of putting the time on it first. And you know when we are working with people in the quick-start program, you have to keep reminding them that okay, you are paying the work, and you are paying the work, and it doesn’t feel like it’s paying back, yeah, but it’s exactly the situation which you found several months of work and after six and a half months you just have been going kind of mental. You know what we are doing. Hitesh: Definitely. That really does reminds me of about pushing a snowball up the hill. Do you know what I mean, this analogy, you know it’s hard work — pushing up the hill. And you think; what am I doing? This is not working. You can see, there is (someone mentioned), but it’s hard sometime to really think, you know what, I am close to doing it. And then all of a sudden something happens, it starts to come together, and you get a break. And then that snowball tips over and it starts to roll down the other side of the hill, and the momentum becomes somewhat self-fulfilling. You know, you still keep the focus, you still got to keep going. But, things starts happening for you, which is really nice. But you have got to do that bit first, of pushing up the hill, and the belief, and to keep going, and all other things. Chris: Absolutely. It doesn’t matter what strategy on a guaranteed rent, for instance, the kind of typical one way. You are having to get around with the agents and explaining what we are doing, you feel like hitting break all of the whole time. And just throughout you are saying, eventually, you kind of hit that critical marks; don’t you. Management is exactly the same. At first you are having to, (it will be out there), kind of trying to find people you might be able to help with it. And then eventually you kind of get to that point where really people are referring people to you, or people are giving you a ring. So, it doesn’t matter what kind of structures you are using, there is a way that kind of critical (mass point); isn’t it. And a lot of effort required beforehand. Hitesh: Yeah. Very much that. Chris: So, if you kind of quit your corporate life and went rent to rent, which presumably a cash flow strategy. So what was it that attracted you to then do another cash flow strategy on top of that, in serviced accommodation? Hitesh: This whole thing was kind of around with rent to rent HMO that you are going to make at least £500 a month. Chris: I was for about a thousand pound a month per property, and I was about to say that sounds very familiar. Often that’s said about SA as well. Hitesh: Exactly. And that was powerful, it got me into the rent to rent HMO. And the reality is that it was really different, quite honestly, really different. My result weren’t like a thousand pound a month, not at all. My first one wasn’t even £500 pound a month. So, actually if you look at it (and) the breakeven point, because you got a furniture. Actually I am still trading at a loss, in the first… As soon as you go live you are trading at loss. You know, that takes at least twelve months to break even. Chris: Yeah, that’s true. Hitesh: So that’s really interesting because I thought, well actually this is not as great as I thought it was going to be. You know, if I was taking five out, which I end up being leveraging so that to finance the outlay for it, but this will take a whole year to break even. Well okay, I have got to hang in there, it’s a waiting game… it will come good, that’s fine. But then I think maybe naively I fell into a similar trap with serviced accommodation. Chris: I was going to say because that sounded very, very familiar to me. Because people do guarantee rent and a cashless strategy, but, you have got to claw back all that cash which you presented in the first place, and that’s usually a six to twelve month period. And of course ironically, most of the people doing this are doing it because they need money now. Hitesh: Yes, that’s right. Chris: So it always depends how you look at it. You can look at the money as well but now we have got the cash flow. But in financial terms if you don’t have the money then you are going to have to borrow the money or come to some arrangement and work with someone else, which means that you are not going to get that cash flow from day one. Hitesh: That’s correct and the other thing that attracted me to serviced accommodation or changing was, I am a sort of person that I write like to, if you like, diversify, so I don’t really want all my eggs in one basket anyway. So, having the HMOs that (will) build up the rent to rent, you know, that was good and I thought to myself, well, I have got a good focus on this but you we have got rooms got rooms that are filling with pushing the market rent, good properties. But, I always worry about tomorrow, (if it’s) going to change. So, having a new strategy and a new property business, if you like, means I am kind of de-risking myself in that regard. So as long as I keep the focus on the other thing and have the focus on this new thing, and I felt it was contradictory, you know, but we had systemized quite well, the rent to rent business, the HMO business. So, I felt the time was right that I could spend some more time now, looking at a new strategy and serviced accommodation was what I wanted to do. Chris: Yeah, I think you are completely right. You need to focus at first, to actually build the business up, but then once you know how everything works, you can put systems and teams in place, you know, leveraging quite (hard). Okay. So you kind of make the position into moving to SA, so did you start looking for deals or…? Hitesh: That’s a foundational kind of trading and stuff like that, reading up and trying to understand how it works and comes together conceptually and theoretically. And then went out and started to look for… Actually, you know what happened was, the first deal was a rent to rent, which originally was going to be an HMO. Yeah, it was going to continue to be an HMO. And the builder who was helping to do the work said, oh, there is a lady –you know, it’s quite close by — that’s operating serviced accommodation. And obviously being fresh in my mind from reading and learning and trading and what’s not. The (word) as an interesting thing, I haven’t originally consider it for this property but (why not) consider it. So, she and I had a really good chat and she has been doing it for about one year, so, she had gotten some good underground experience, and we went through some numbers with what she was doing, and I thought it was really interesting. I have done some further research and felt that this could be a really good opportunity. So, we then went for it and we tried to a serviced accommodation instead of HMO. That’s kind of how the first one started. Chris: Cool. So tell us a little bit about that first property, you said it was like an HMO. So where you kind of doing it as rooms or studios? Hitesh: Studios. So, it’s a rent to rent deal, doing the guaranteed rents deal. And seven units in that whole studio, self-contained units. So you have quite nice, quite attractive proposition for the marketplace. But I thought if I can create a mixture and get an amount of money running a serviced accommodation, it was well worth trying. And the numbers really look like they were going to step up quite well for it. So, that’s what we have done, we went for it. When I say we, that’s really me, but the lady was very much helping me. We basically agree that she would help me with the day to day operation, so it wasn’t very much a (we) operation. She came in and she was absolutely brilliant at helping to get things moving in that property. Really-really good. Chris: Does she have like an interest in anything or was she just being helpful? Hitesh: No. Chris: Was she doing it for free? Hitesh: No. We obviously set things up so that she would be rewarded on a commission kind of basis, so I set it as a commission type basis. Because I really wanted her to over deliver and really help us to… I wanted us to have some skin in the game. Do you know I mean. So, she is not investing any money in the property itself but if she is going to provide money from services if you like. I guess what it was really. And she was pretty much handy with everything, from the initial setting up on the portals and platforms, to the pricing, to the guest experience, the after sales, all that stuff, she was doing all of that. So, we set it on a commission type basis and we started… It flew out of the door, to be honest. It started really-really well. Chris: Yeah. And it started with reasonable scale as well, you are not just like taking (on the)… I think the standard way would be take on a two or three bed apartments, and see how I have got to scale from there, so go in with seven studios. Hitesh: Yeah. Absolutely. Chris: So, what do you think you struggled with the most when you first get started? Hitesh: In terms of that property or like… Chris: Just common, in general. You know coming into SA, it is very different from anything else you might see in property, it’s a real whole business; isn’t it. So there is so many different moving parts to it, from the systems you might have in the background to the end product which people have to get right every time, or they get, you know, you don’t leave guests unclean towels, your (linen) or anything like that, Through to the kind of bookkeeping aspects for it. So it’s such a kind of high arena really, SA. Or was there anything specifically which you kind of struggles with, or it was new to you, or did you feel like it was just a big kind of learning curve but you took it all on board quite easily. Hitesh: To be honest with you, I was terrible. I didn’t get very involved with the business at all. I went for an approach where I had leveraged this lady, because she has the experience, she knew what she was doing, and she was delivering pretty much everything, and I didn’t get involved really with it. I went back to this idea of spending a lot of time with my family and I was quite happy because I have leveraged out the whole function to her. But, in hindsight, I think that’s the bit I struggled with in that… And the e-mist book is such a good book. Early on in that book they talked about delegation by abdication, you know, leveraging by abdication. You give someone a function but you don’t actually set the KPIs and measurable, to track actually how well they are delivering. It’s fine to leverage someone, but if you don’t really know what’s going on then what’s the point. All I could (say is that) in a month money was coming in and I was making profit, (first of all), happy with that. But, by making tweaks and changes you can make that profit even greater, you know that’s the beauty of the business; isn’t it. So, in some ways and it sounds bad, I kind of leveraged someone. But, I didn’t really set anything up in terms of KPIs and measurables, to really understand the business myself in any real detail. So I think I probably struggle with that because obviously at some point things started to change. You know demand changes, or the amount of profit I am making is changing, although I am actually… Chris: And then you have no idea why the income is going down. Hitesh: Yeah, I don’t know why. Because I don’t have a grasp on the business, and then you are really relying on someone to tell you about your business and it’s not even bloody their business. Sorry, I know that sounds a bit ridiculous. Chris: That’s fair enough. It’s easy enough to kind of fall into, but then obviously at some point you kind of identify that risk and started involving yourself a lot more in the day to day operation of the business. Hitesh: Yeah, very much so. And I think that’s probably about the time when you and I got involved because I am really a great believer of kind of working with people to kind of create best practice and systems, and have people that have good experience in what you are trying to do and we had a really great chat and I think (a) really good connection. And it was from then that we started working together and you had helped me to kind of see the whole parts of the business, the different parts of the business, and to get me more involved in it, so that I have got more control — that was it — I think you really helped me to get more control of my business, but at the same time keeping this lady happy. Because (certainly) now I am starting to meddle in what she has been doing. But I have to because it is my business and I have got to get control of it, you know, and (deal) with myself in that regard and actually make sure that we are running a very smooth and profitable business for everyone. So that was the next kind of step, really. Chris: Yeah. And it was taking it from a, you said, leverage by abdication, into the (thing) that we always talk about, the best way to leverage is you build a system get someone into the system and monitor their performance through KPIs. Hitesh: Definitely. Chris: And so, as I said, SA is quite a complex beast; isn’t it. So it’s just getting your head around all the different areas of that aspect and building your own way of doing things. It was what then kind of really built into a business for you as opposed to, essentially, more of a kind of hands off investment before, I’d guess. So, what pointed you to say that you were going to start scaling up your business and from the kind of original units that you took on? Hitesh: So, I always had in my mind… And again I think it’s one thing that we talked about in one of our mentoring sessions. Because I had taken this lady on and I was paying her on a commission type basis. I was quite happy and understood that the concept of leveraging, you know, a staff member. So I was really happy, then I thought well, we definitely got capacity to take on more properties. And if I can do that I still have really good time free, but still making more money, we would be foolish not to do that. So, that was the idea that I really wanted to kind of move that forward and just take on some more properties. Yeah I obviously wanted to take more profit and be more profitable. But going out there and starting to leverage some of the relationship we have been building over for the last two years now, then it was good because some of the good properties were coming and we thought, okay well we can leverage this. Get more properties on, we have got the capacity to deliver and the expertise now, to deliver on a product. And that was just really a no-brainer to try that. And then obviously with us working together, Chris, having more systems and controls in place, meant that I could be more kind of strategic, in terms of my involvement with the business and make sure that we are steering in the right way, and that we were really focusing on creating a very nice, really good customer experience, product, that was good for them, good for us as well. Chris: Yeah. And that focus on the end product, which I think when you have got one property your first one and you are setting up you have such focus and attention to detail around it. And as you have started to scale this property, the biggest thing and the most important thing, which can kind of get lost along the way. Is that you have got people in all this different mechanical aspects of the business but you did have to be keeping an eye on the end product. You know, in the guest experience, (multiple) customers actually going in and experiencing. Very important for sure, very easy to get lost. So when you were kind of going from that point and to scale up the business; what kind of models where you looking out for that? Hitesh: Rent to rent. That was it, that’s all I knew, to be honest. That was it. Chris: You had a bit of a false start with that really; didn’t you? Hitesh: Yeah. And no one ever told me about something called VAT. Chris: Until we spoke. Hitesh: Until we spoke. And you said to me… are you joking; are you kidding me. Because that’s really a game changer, and not in a good way. You know that’s life. Chris: Not a kind of positive impact really. Hitesh: No. Chris: So we kind of have a look at your portfolio and I have to look at the different methods around it. In fact I think yours was genuinely the first review I ever did, you know, a couple of years back. And we have kind of been introducing you to some of the other modules and management was certainly one of those modules. And I seem to remember when we kind of looked over it. You went well, this is kind of a no-brainer; why am I doing this when I could be doing management, taking a similar amount of money and not having to put any capital (in); right. Hitesh: Yeah. Absolutely. And it’s also interesting because, you know, going back to like owning your own assets, this kind of obsession of, sometimes you want to buy into that property, we want our own assets and we get a yield that comes off it, Actually a management module… You know, you don’t have the assets but the yield, and it’s fantastic, you know, you get a great amount of money from an asset that you are just managing but you don’t have any of that necessary (recycled) with it. You know all the capital outlay (actually) get going either. And it’s a really scalable module as well, which when you opened my eyes to. Chris: Yeah. And I think we were looking at your financial targets, and we went okay so you need X many management properties to achive that andyou were off then, going straight to find these properties. Hitesh: That’s right. Chris: Okay. So, you started to scale the kind of management module, so how has that been going for you now? Hitesh: It has gone really great, really-really well, it has been really game changing. We have taken on some pretty quite diverse properties, we have got some one bed property, we have got quite a few two bed properties, we have also gotten really interesting units that, you know, quite a large scale, and the management fee on those have been really great. So, it has been a really enjoyable journey, to move up from. And then also with our rent to rent properties, we have also restructured that — you helped me with restructuring that. So moving away from rent to rent to become a more management property. By selling them as investments to other people but retaining the management on them. So, which have helped me from that capital perspective, in terms of paying off on my capital debt that I secured into the business to get going in the first early days, helped me to get rid of some of that. But I retained the management fee on that as well, which was really-really nice. That’s very scalable than to do it that way. Chris: (I remember) because of that impact, stepping away from that and taking it below the VAT threshold, actually making very similar amounts of money, but you are also getting this nice capital input from having sales and deals. So, how many guaranteed rentals do you operate now? Hitesh: Now we have two. Chris: So kind of scaled it all team way back to below the VAT threshold and all the rest of your business is around the management module. Hitesh: Yeah. Chris: And so, obviously you have scaled your management business to a reasonable level now, and that’s kind of the point that this series of interviews is really talking to people and seeing how they have scaled up. Because I know there is, to some degree, a sentiment now around scaling up in SA, though it can be very tricky, and very hard; so what do you feel were the most important elements to you kind of scaling your business up to the level that it is now? Hitesh: It’s really good question. I think there are few things… When you say there is one thing — there is a few things. I think when you start to scale up it can be quite daunting, you know when you are taking on more and more and more, it can be quite daunting. And actually you come to this kind of feeling, I don’t know if it’s a psychological feeling. And when you think oh crikey, things are moving quite fast now, and wow… You already probably can actually do it, you start to have a little bit of self doubt. There is also responsibility, you always have responsibility to the landlord that you are representing. And you know as management, you have a lot of responsibility to your staff as you scale up and take more people on. You have a responsibility to the customers that are going to experience the product, and try to get that. And all that combined, for me, it starts to create anxiety and worry. So the mind-set stuff was really important for me, very-very important, I really went back to my (ways) to always do, which was running in the morning, doing a really early morning routine, I am very much a morning person. And starting my day with time for myself, to really get my mind-set in the right place so that I can really perform on my business. That was honestly so important. It’s hard because sometimes you can’t directly attribute what you are doing today to your mind-set or some other things that you do on a day to day basis, but for me I am convinced it’s helping me to perform and do really well. Chris: So do you feel that a routine and it’s very important to kind of bring structure to an entrepreneur’s life. Hitesh: Yeah, I do. Chris: You know, on the basis that you have not go to be in the office at 08:30 or 09:00 and you have not got someone looking over your shoulder to see if you are working or not and that type of thing. Hitesh: Yeah, I think so. I am very much a quite structured near kind of person, anyway, organised. So for me it’s very important. I mean I do think it is, you can easily lose days, weeks on end, if you are not careful and you can get so easily dragged into things you shouldn’t be doing. You know as you scale up and get more involved, you know, you can easily get dragged into organizing the cleaning rota. Fielding the calls for the customers that are not happy or really happy. And actually you have got to really be very disciplined to what you want to do with your day that’s going to deliver and add more value to the guest, or your business, or your staff, or whatever it might be. I mean that’s definitely one, the psychology mind-set side of things. That was massive for me. The second thing was really your numbers and your accounts, and your profit and loss, and that sort of thing. For me, it’s a very critical area, such a critical area. I think there is many of us, me included, would go on this journey and have no clue whatsoever about that business. And I don’t mean in a harsh way… But honestly it’s such a major problem, I think that we go up there and we are so focused on getting more sales and bringing more properties, just go and get them, just go and get them, set them up, just go, go, go. But actually when you measure them, some of them could be performing not very well, or with some small changes you can make them perform really-really well. You know, with some, you got a cull and say this is not the right way I am doing things, get rid of them. But you only know that, for me, you only know that through your numbers, and you have to be (so) on your numbers, also setting up KPIs, I never had KPIs. My only KPIs was the kind of occupancy (rate). Chris: And we both say what a great gauge that is. Hitesh: Having KPIs in place, having your accounts, and actually looking at them all the time, like all the time, and making all your decisions based on it, you know, it’s very-very important. I think for me, scaling up, that’s a massive part of it. Chris: Yeah. Definitely. Because otherwise, it’s very focus on scaling and lose the performance aspect of it. And realizing you are not really performing where you need to be. And actually it’s part of growth, and that’s always going to happen to various degrees. But like you say that, what you found certainly is that the biggest impact you can have on that is by having focus around the KPIs, having focus around the reports, and checking in with them a couple of times a week to see where you are at, what can you do to impact things, make a difference, etcetera. Hitesh: Yeah, definitely. And you can become very busy otherwise, just running around as you grow; but is good running. Good way of measuring. So that was very-very crucial for part of scaling up. I think also really embracing and leveraging people, systems, technology — huge — and what can be done with technology is just (depending on that)… But so powerful because it can give you really low cost, automation, much smarter way of doing things, and then we have talked about… And low cost can really make a difference to a business. You know leveraging people, very important, you know, part of scaling up as well. You can’t do everything, you are going to have the right people in place. Chris: You wouldn’t want to be there Hitesh: No, you wouldn’t… Chris: It’s very hard; isn’t it? It’s very hard to let go of various aspects, you know, controlling the business. Hitesh: Yeah. A hundred percent. And then also having peers, people that are operating similar business to you and being in the right network of people, I think it’s really important too. You know, regular meeting up with people, having contact with other people. You know, having people around you that have best practice, and are operating best practice, that know their stuff, you know, it’s really crucial to surround yourself with people like that as well. Then the part of the mentoring and the coaching that we do together for this few years that we have been working together, Chris, it’s been really vital, because it’s part of that network. And when you are not sure, because you don’t ever have all the answers when you are not sure, you got to better ask somebody. And get answers to that instead of reinvesting the wheel, you can implement things that other people have done that have served them and worked really well for them. You know, you put it into your business and yeah, great, you are seeing almost immediate results. Chris: And it’s also a kind of motivation as well; isn’t it. I was talking with Graham, he is also a member of the boardroom, and he was saying how when he comes each month, it’s like if someone has come along and they have taken on an extra block, and he is like, okay I better get my ass in gear, I feel like I want to come back… He sees someone else and they have implemented a system which (is working) really well in their business, he is like okay, I am actually going to do that. So there is a lot of that kind of peer driving your business forward as well, in terms of healthy competition, if you like. Or getting ideas and kind of wanting to do that. And if I can put words into your mouth, I think probably the element in your case was just scaling, and we have already kind of touched on it really with just getting the strategy right, because obviously if you continue to scale using the (guarantee rent) around what you are doing, then that would have ended quite badly. And so it was (all the) things are fundamentally important but getting that strategy right, I think without getting that in the first place, there is no foundations to build off. Chris: Very true. And that is a great way, Chris. Again I think if you try and fly on your own — somehow you would be aware of some of this stuff. And when you surround yourself with people that are doing same business, operating a similar way, ahead of you then you can learn, you can learn and you can review things and go, do you know what, this is not quite working, this is the reason why it’s not working, you know let’s change approach, let’s try something new, something different. And then you can explore it, and then implement it and try and see what happens. But the strategy — that was a real big game changer, that whole VAT thing, changing the module, going in the management module, and scaling upwards, it was a really game changer for me. It’s a very massive thing, thank you Chris. Hitesh: So we talked about (build) to a scale module, and we heavily recommend to people that (are often) just scaling up straight away. You build a module, say two bed properties using half (mile) of your city center, targeting trades, and (tourists)… Whatever your module might be, on each specific module you test that module and make sure it works in the way you expect before scaling up. So if you are talking to someone who have maybe been through that process, who have been operating it, you know, two or three properties for six and twelve months and now they are looking to really push forward and scale their business in the same way that you have; what kind of advice would you give to them? Hitesh: Set up your KPIs, early (days), really early (days). Get your measurables in place and how you are going to measure it — your growth — I think that’s really crucial. I would say get up your game, kind of like mind-set psychology wise, you know, really, when you go to any level, it is very (testing) of the mind; do you know what I mean. And I think you are going to be prepared for that, and I think that’s a big thing. And make sure you got the right kind of structure in place, strategy and support in place for that next phase. You know people that you can turn to, work with, (help) with, and have the right systems, and process, and people in place. That’s what I would say. Chris: Thank you. Thanks for joining us today Hitesh. I hope everyone found that very interesting and also very useful. Hitesh: Thank you Chris so much for your help. And thanks for inviting me today, I appreciate it. Chris: Cool. Taking you. Hitesh: Fantastic.   Don’t forget to subscribe to the podcast. To hear the latest on serviced accommodation. If you are looking to start, systemise or scale your serviced accommodation business, visit www.thesapodcast.com to see how we could help you further.          

WSP04 - Identitätsabgleich mit Chris - Was soll das Ganze

Chris WAS going to release a series of mini episodes while hunkering down during Hurricane Matthew, but the Crespodiso Studio was without power from before sun up until after sundown, so instead here is one little bonus episode post-Hurricane in which Chris recaps the boring day that ended okay, and also ponders his own existence.... The post Bonus Episode – Hurricast 2016 appeared first on Cinema Crespodiso.

On this episode we are recapping the events that happened during WordCamp Los Angeles 2013.WordCamp LAX was really smooth and well managed. General thoughts are that it was hard to imagine this was a first time organizer group for a WordCamp. It was also representative of life and diversity in Southern California.EventsFriday: The traditional Speaker/Sponsor dinner in HollywoodSaturday: All day sessions running in 2 rooms at Cal State LA followed by the after party at the Blue Cow Kitchen and Bar in Downtown LA.Sunday: Afternoon sessions at Cross Campus in Santa MonicaQ: Why did the organizers decide to spread the weekend out over the Greater Los Angeles area instead of keeping it to one location for the weekend?A: Natalie has a really good relationship with Cross Campus and immediately thought it would be perfect for the smaller Sunday event since not as many people attend the Sunday event as they do the Saturday event.  The Saturday venue needed to be much larger, and they were having trouble finding an appropriate location. Cal State LA kind if “fell into our laps” and it just worked out that way. It wasn’t planned to cover the east side and west side.Saturday PresentationsSteve: Really enjoyed Paul Clark’s talk on Saturday Sass* and Less CSS. He’s a great speaker and funny with a great sense of humor. He inspired Steve to research Sass and work it into the development process.Steve also liked Konstantin Obenland presentation The Customizer and learned a lot.*Sass is a different way of creating CSS much more efficiently. Jeff: Favorite was Paul Clark.Jeff also enjoyed Scott Bolinger’s talk on Lesser Known but Super Hip Responsive Design Tricks.Jeff was also inspired to take the information from Konstantin’s presentation and implement it into his own work. Chris: Was anticipating the WordPress Consulting for Large Companies by Karim Marucchi, John Giaconia and Kara Hansen. A collaborative presentation between Velomedia and The Walt Disney Company. Takeaway for future presenters Speak on a topic that you know. It’s that simple. If you know your topic, it becomes a conversation and that’s what makes a good session. A good session is not reading off of slides. It’s when an audience is responsive to what you’re talking about.WPwatercooler Saturday presenters* Steve: Underscores – The only theme that matters* Chris delivered the Keynote* Se: DIYWP: Making WordPress Work for Your Small Business* Suzette: You’re Live! …Now What?: Post Launch Setup Process and ProceduresWPwatercooler Sunday Presenters* Jason: Improving Support Documentation by Using Video in the Dashboard* Jeff: Part of the Business Panel DiscussionMentions* Huberts Lemonade (sponsor of WCLAX and provided a ton of cold bottles of lemonade to attendees.* GoDaddy[LISTATTENDEES event_identifier=”ep54-wordcamp-2013-recap-show-wpwatercooler-5-523fd518644ae” show_gravatar=”true”] See acast.com/privacy for privacy and opt-out information.