On the show today we have… Casey Ryan of We Buy Any Vegas House!
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Show Links:
– WeBuyAnyVegasHouse.com
– PNW Big Badass Real Estate Expo
Show notes for Casey Ryan of We Buy Any Vegas House!
The Vantastic Life is…
– is in Frisco CO near Copper Mountain!
Joe is in Frisco Colorado, Julie is in Seattle Washington, and Casey is in Las Vegas Nevada.
We haven’t had anyone that’s high volume from an iBuyer market, like Vegas.
Joe
Casey we’d like to hear more about you. GIve it to us!
Casey
I got a mechanical engineer degree then started buying and selling Jeep’s. Basically flipping Jeep’s.
Then found a real estate mentor, and started getting into that, and got my first taste in 2013. Which is when I did my first deal.
I was so focused on getting my degree.
Sky the Australian Shepard is hanging out in the office here.
I graduated and was working valley at night and obsession over real estate. Then got back with that mentor.
There were some job offers as an engineer, but I dove into a better opportunity with real estate. This was late 2015.
The first 3 years was flipping and we did around 70 properties. I was 22 years old. It was really hectic and disorganized.
We weren’t doing any marketing and I was getting all the deals from the MLS and agents. This doubles the work load!
My mentor was an agent at that time.
Julie
Of the 70 deals did you hit home runs, or what?
Casey
We kicked ass! We lost on 1 deal. On 300 flips total we only lost on 1 or 2 deals. And our average of $20-23k net. We did great! The market was very hot at that time.
Julie
Are you margins the same these days?
Casey
Average is around $18k or so. The flips are higher but the assignments are less.
Julie
I think your numbers are so different. In this market we could sneeze or fart and lose $20k, here in Seattle.
The margins in your market get smaller and that’s the point.
What types of flips are you doing?
Casey
We have never done lipstick on a pig. So very rarely done carpet and paint. We take pride in delivering a good product. Which can be over doing it.
Our market boomed in the 90’s, so they are stucco exterior, tile roof, some need new windows, but…
Julie
What’s the most expensive thing you deal with?
Casey
The properties are just so predictable. That’s why we can survive on these margins.
Julie
You have some players in your market!
Last year you did 30/70 flips/wholesale. That’s a lot! What makes you decide to wholesaler vs. flip?
Casey
When you’re flipping 100 deals a year it becomes brain damage. Wholesaling is just so much easier.
You can cram in a lot more wholesales in a year.
The main reason is the construction. I like the creativity of it, but when you start dealing with so many problems it becomes hard.
Julie
Do you keep any rentals?
Casey
I didn’t collect a bunch of rentals, I was scaling up my cash machine.
Rentals out here are so difficult to make cash flow. If you’re on the Midwest or eastcoast that makes sense, but out here it’s tough to make work.
Julie
Our numbers are double that! They are dramatically 100 times worse. People are doing a rent by the room model. Not sort term necessarily.
I can hook you up with someone who’s killing it on that.
Casey
The only things that I’ve made work are subject to.
Julie
Are you familiar with lease options?
Casey
I’m not an expert, but I know how they work.
Julie
How about pre-hab, which works in a hot market.
Casey
I’ve done a few like that that were in the 50 day mark that was new cabinets, carpet…
I only own the property for 50 days.
The days on market for my flip properties are under 10 days.
Julie
What’s the average cost of a standard flip?
Casey
It depends on if we are the 1970’s or a 2001. 28-32 dollars a foot. Or 25-28 dollars a foot. $28-32k per flip.
Julie
If you have numbers like that… tell us in the comments below!
Out here we are spending $60-80-140k per flip. Bigger spreads, bigger risk.
How do you get leads?
Casey
We look at all marketing strategies and do them all. Ringless voicemail, texting, PPC, Facebook, SEO (highest converting), so a little bit of everything.
We call here in-house. My team – assistant/transaction coordinator, Kelly (she’s awesome). All of our team are rockstars!
Kelly is salary, plus a per transaction fee. But she generates leads from home as well.
We have 1 main acquisitions guy. If Kelly puts in leads, they are really good.
Ryan Groove is my acquisitions guy who has been with me since the Jeep flipping days.
Corey does management and helps find deals on MLS as well.
And a part time guy Chance that cleans up Ryan’s pipeline. He works 25 hours a week and goes to school.
We do a lot of SMS and ringless voicemail.
We do see these getting saturate. Tracking the cost per inbound message, it has definitely climbed up over the last year.
Julie
What is your best source?
Casey
SEO is our best, about 1 in 5. PPC was 1 in 10, but the iBuyers are driving the costs up.
Direct mail and PPC the iBuyers are dumping money into.
The highest portion of revenue is from SMS.
Julie
How does your sequence look for that? What lists are you pulling?
Casey
When you get to the point where we’re at. We do run preforclosure and probates. I went to the courthouse and skip traced the entire the county, over 60k. And were were left with over 480,000 records.
Julie
What are you using for CRM?
Casey
We use a Frankenstein version of Podio. I don’t watch too much TV and and I sit on Globiflow, it’s like a game for me.
Julie
Why wouldn’t you get a deal?
Casey
I’m a real estate agent as well, but I don’t take on any listings. We just built out our retail side of the business. A workspace on our CRM that’s catered to agents. I wish I would have done this earlier.
We push the agent leads to her and she’s a closer.
We don’t get deals because it will come down to price. We have more flexibility.
We have really strong money partners. We have hard money, but we have great rates.
Julie
We are getting down to 8% with flexible points.
Casey
We are paying more than 8%, but our points are more important. If you have experience you’ll probably be around 10/2. We are now at 8% and no points.
Julie
You should connect with our guys, Certain Lending. They have a 30 year product!
Do your wholesales fall out at all?
Casey
Yeah, that happens, but I think we are doing better than most. I think we are just under 5% cancellation for ours. We closed a good majority of them. We don’t run into a lot of title issues here. And we look at the recorder before putting deals under contract.
If a deal is too thin or a buyer backs out, I will just buy it.
Julie
How do you give someone an offer in 7 mins?
Casey
We never miss calls. We work 24/7, and will get offers in 7 mins.
It’s not an automated thing. We will actually comp it. It’s a simple formula.
We will be buying somewhere around 80% minus repairs. My guy always answers his phone.
Julie
We know our market!
The nugget in there is that you’re a quick response. You do live pickup?
Casey
Yep! Live pickup and no VA’s.
We spend so much money on marketing that I’m not going to use someone in the Philippines to answer the phone.
Our marketing spend is around $20k a month?
Julie
How does that breakdown for you?
Casey
I work with Jarred Vadalis… but we needed to be able to get it at cost, so we helped develop it. We hired a developer and we are the only ones that use it. It’s so difficult with how competitive texting is right now. The response rate just keeps falling.
The main reason that it’s falling is that your numbers are getting burned. The carriers are creating a blueprint of the messages that you’re sending and they will block it.
You need a really dynamic messaging profile. It’s needs to be alternating each message. It’s constantly changing.
Julie
What are you going to do. Is half of your spend on PPC?
Casey
It’s about that. Texting is very expensive and ringless voicemail. And spend money on SEO content. Facebook is OK, and will get us a few deals a year.
Julie
Do you think these things are being saturated because of the message?
Casey
I think… you have to find a balance to make yourself unique but not over complicating it. We try to come off organic and let people know that we know our market better than the iBuyers. People appreciate when you start to talk with them and tell them that they won’t be a good fit. We build a lot of trust with people.
Julie
Last thing… the whole iBuyer thing, who’s top dog?
Casey
Probably OpenDoor for a while, but Zillow has come in with more aggressive offers. But I’m seeing their offers coming back. They were WAY overpaying.
Julie
How do you beat them?
Casey
We are buying the houses they don’t want because the rehabs are more expensive. We work with Wedgewood hedge fund.
Julie
Let me know if anyone wants to work with Wedgewood.
They can beat Zillow and OpenDoor.
Casey
Yep.
Julie
What is the rehab dollar they are looking to stay within?
Casey
Under $10k, or anything with roof repairs or 1980 or older.
They want to quick carpet and paint.
They are paying somewhere around 88-90 cents on the dollar minus repairs.
Julie
Wow! Are there any other floor plans other and 1 and 2 story homes>?
Casey
There are a few split levels.
Julie
Do you sell them homes?
Casey
Yeah, sometimes it’s better that way.
We double close them.
Julie
Will Wedgewood take assignments?
Casey
Oh, yeah.
Julie
Do you think OpenDoor will go down?
Casey
I don’t know.
Julie
Do you see your business moving toward selling more to iBuyers?
Casey
Very few of our deals went to iBuyers. A lot of times it doesn’t pencil out. There are some hedge funds that are buying pools of rentals.
Julie
Who is that?
Casey
Progressive residential that are institutional. Cerberus.
Julie
Have you heard of Invitation Homes?
Casey
Yep, but haven’t sold any to them.
Julie
Let’s wrap it up and keep in touch. If I’m in Vegas I’d love to have some coffee.
Last thing… What’s favorite tool or app?
Casey
Podio is a giving.
Julie
What’s your favorite trip?
Casey
Bali and Thailand were all amazing. My favorite is Switzerland. It has everything all in one view!
Julie
It ain’t cheap!
We love you coming on today! If you’re ever up in Seattle we have a really great real estate investment club.
And we have the PNW Big Bad Ass Real Estate Expo. It’s happening in July.
Casey
Thanks for having me!
Julie
We have weekly meetup that you should checkout at meetup.com/seattleinvestorsclub!
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