- 04:32 – Scott shares his journey from top agent to franchise owner.
- 11:15 – The importance of learning new ways to make money in real estate for business resilience.
- 18:45 – Exploring Scott’s goal of investing in apartment complexes and the strategic approach.
- 25:10 – Understanding the nuances of wholesaling in South Carolina and the cost of waiting in the real estate market.
- 32:55 – Insightful analysis of the Denver real estate market, including challenges, opportunities, and future trends.
- Website: https://you1stinfinity.com/
- Linkedin: https://www.linkedin.com/in/scott-smith-9b01a333/
- Email: scott@you1st.com
- Contact Number: 843-619-3005
- Instagram: https://www.instagram.com/exitstrategiesradioshow/
- FB Page: https://www.facebook.com/exitstrategiessc/
- Youtube: https://www.youtube.com/channel/UCxoSuynJd5c4qQ_eDXLJaZA
- Website: https://www.exitstrategiesradioshow.com
- Linkedin: https://www.linkedin.com/in/cmelette/
Transcript
CORWYN:
Do you want something more? More meaningful moments, opportunities, deeper relationships, and memorable experiences? Do you want to make a difference? If you said yes to any of that, a career in real estate could be the opportunity you’re looking for. Guiding people through one of the most important decisions they ever made. The purchase or sale of their home can be both rewarding and lucrative. Exit Realty’s revolutionary compensation model, training, and technology provides you with the tools you need to start and build your successful real estate career. Call Exit Realty Lowcountry Group today at 843-619-3005, that’s 843-619-3005 or visit join.exitlowcountry.com and make your exit today.
Good morning, good morning and great morning guys. Welcome to another fabulous episode of Exit Strategies Radio Show. Hey guys, I’m your host, that is me, Corwyn J Melette, broker and owner Exit Realty Lowcountry group in beautiful North Charleston, South Carolina. Guys, look, we got an extra special guest today. We’ve been stretching the envelope, engaging and reaching further and further to get input commentary advice. Title itself says at all. Exit strategies want to move people, an action word and the strategies on how to best move and fulfill the missions, the visions, the plans, all those things that we all make, how to execute, how to plan and execute those things. That’s today. Look, I’m very humbled. Very honored to have with us, Scott Smith. God is the broker. Yes, he’s a broker too. But he’s a broker of YouFirst Realty Infinity. Scott, how are you doing?
SCOTT:
I’m fantastic. Colorado, Denver is a beautiful day out there. The sun is shining, and we have none of your humidity. So we are not a soup kitchen. We’re not like Phoenix where it’s another neither. It’s almost a perfect day outside like San Diego weather in the middle of the country
CORWYN:
So Scott, if you don’t mind high level overview. Tell our listeners about you, who you are and what you do.
SCOTT:
Yeah, so I own a franchise of a larger brokerage YouFirst Realty. Bought my franchise about a year and a half ago, [it] was the first franchise that YouFirst sold, I was one of their top agents for a long time. And over the last year and a half, I’ve grown to about 13 agents. And then I’ve gotten into wholesaling and some other investment strategies. And really just remembering everyday that there’s a million ways to make money in real estate and trying to learn a new one every year so that I can grow my business, make it bulletproof from recession or depression or whatever the economy is make sure that there’s income coming in the door.
CORWYN:
So first and foremost, I want to give a full disclaimer to our listeners. State of South Carolina guys remember this, every time we talk about wholesale here on this show, we always give you a disclaimer in the state of South Carolina. Wholesaling is a real estate activity that requires a real estate license. Okay, so if you want to do wholesaling, wonderful, get a real estate license in the state of South Carolina. Have that. Whatever you do, it’s your brokerage, get somebody signed on it allows it, have at it. Scott, you started real estate investing how long ago
SCOTT:
I was a loan officer in the early 2000s, started a mortgage company around 2004 – 2005 and ran a mortgage company for a few years, we did mortgages and small business financing. Back in that time, I did a lot of buy and hold. So I owned about $4 million, worth high end property and then in 2008 I don’t know if anybody remembers 2008. But it was a little bleak for some of us. I handed my financial life back to the banks, gave up a bunch of property went through bet chapter seven bankruptcy, which was an event and an experience all on its own, didn’t have a real estate for a few years, bounced around to some corporate jobs, and about six years ago, got back into real estate, stayed away from investing just because I’d been through a rough time with it. And then in the last year, I’ve started to pick back up, that’s when I learned about wholesaling because it’s an easy way to increase income without necessarily having to buy and hold property and my goal is to buy and hold apartment complexes. So I’m probably a year and a half away from that goal.
CORWYN:
And a couple of things I kind of pulled and picked out what you were saying this God number one when you said that you started in the business early 2000s wasn’t first thing I was thinking, look, there was a recession that came shortly after it showed enough you mentioned it. And I think you stopped breathing there for a little bit. I know it probably still, you’ll still give some of us heart palpitations to even think about it. But what I’ve heard in there was that one, you didn’t give up. So even though you had the experience that you had, you regroup, digested, reframed, you went back at it a little bit differently than what you’ve done before. However, you still have a goal that is associated with you still trying to, quote unquote, get your job back, if you don’t get hit in the jaw, pretty square with our upper cut with that hook. And are you trying to get back in the game and refocus and regroup. You work with a lot of investors and developers and stuff in your market? Am I correct?
SCOTT:
I do work with with investors in developing is something that we’re starting to get into.
CORWYN:
So I definitely want to talk about your market in Colorado. What are the strategies that you guys are getting? So you want to get to apartment buildings? What kind of structures are you thinking about? Are you starting with smaller, small quad, eight plex and things like that? Are you looking to go large scale or in a larger complexes
SCOTT:
That’s one of the reasons that I belong to a group called the Billion Dollar boardroom, I belong to a real estate mastermind with, one of the best things you can do, whether it’s the one I belong to, or one of a million of them that are out there is get yourself around like minded people who were doing the things that you want to do. I say it all the time, I love being the dumbest person in the room, because it shows me all these things. And so one of the great things about Javi’s group is almost everybody in there is at some stage of what I want to do. They’re buying small apartment complexes. The last meeting, we were out, I was talking to a group of folks who bought a small motel and went in and restructured it so that it was all automated, got rid of the manager, all of a sudden, this thing’s turn in profit every single year in turning good profit on a 16 unit hotel. So my goal is I want to skip the smaller apartment complexes, I want to over the next year really just stack cash, find myself a 35 to 50 unit apartment complex and get involved in it and then bind it in a value add situation where I can go in and do little things put in electronic door locks make them smart apartments, where now all of a sudden rents amazing here in Colorado, if you’re a landlord rent is higher than it’s ever been, it’s scheduled to go up every single year when some areas 15 – 20%. So just by do going in and making small changes, upgrading units. So you can really do a value add and be able to increase the amount of rent that you can ask for. So yeah, that’s the goal is to find something that needs a little bit of updating, and then get it to a state where I can then turn it around for a low investment in be able to raise rents and really be able to increase the revenue.
CORWYN:
Let’s talk about your market as a whole. So you’ve been practicing for a while Denver market a beautiful area here. Can’t wait to see it. What does your market look like? Like? How is your inventory? What does your average price look like those kinds of things
SCOTT:
Inventory is very low. Denver is in some ways a unique market. We’re landlocked with the mountains on one side and Kansas on the other so we can expand the East we’re we’ve expanded West about as far as we can go. And we can go north and we can go south, if you go back to 2017. We were running with about 30,000 ish properties on the market, including land townhomes, single family, just all properties. If you look at our market now right now we’re at about 6000 properties on the market. So it is significantly under what it is in a healthy buyer’s market. Although if you go back 18 months, we were at 3000 homes on the market. So we’re about double what we were either the peak or the valley, whatever you want to call it, of the COVID market where everything was insane. So buyers are starting to see a little bit of relief, because right now you’re able to get some seller concessions on homes, maybe get a house a little bit under asking. But the average pipe price on a home is about 550 – 600,000 in Denver prices are still up. And I really I think it was Barbara Corcoran that was talking here about once we get closer to the election interest rates coming down. And if interest rates drop a point, you’re going to see just a shark frenzy of people getting back into this market and wanting to sell and buy which is going to push home prices up even more. So if people are out there wondering is now a time to buy. and you’ve probably heard real estate agents say this before I didn’t make the saying up you marry the house you date the rate, you’re better off buying a house today and paying a little bit higher interest over the next year before you can refinance, then you are waiting a year because if you wait a year, you might miss your opportunity. And if you’re looking for a $500,000 house, and you want to wait a year to go look at what $400,000 houses are today, because that’s what you’re going to be buying in a year or two
CORWYN:
It’s interesting you say that, what if rates don’t come back, all prices are still appreciating, some areas, more so than others but overall home prices are still migrating upwards. If rates continue to go up, then and if they never come down. If you don’t you have a major purchase now then ultimately, you’re gonna end up with a higher rate anyway. So it doesn’t benefit you to wait in a market where we’re still short on housing units nationwide, it makes sense to go ahead and make the investment. And if rates subside, if they ease, then wonderful, you’ve already gotten your house, you can lower your payment in the same house, how often can people say they can do that? So that’s where the true opportunity is. That’s interesting, because I agree wholeheartedly that with that philosophy of mindset, the reality is that rates do subside a point, it’s gonna be a frenzy, which means home prices going up, take off again. So how are you stressing this with the consumers that you’re working with? Currently, to get them to truly understand those points.
SCOTT:
I had a client back in 2019. And we’re going to call him Alex because I don’t remember his name. But Alex told me he was waiting for the real estate market in 2019 to crash and so he wasn’t going to buy in 2019, because he just knew the real estate market was going to take a dive. And that’s when interest rates were 4%, maybe you could get them at three and a half. And in 2020, what happened was, everybody knows the market took off, and Alex waited himself right out of being able to buy. And so I really think showing people that is an eventuality, if you wait too long, you might wait out your opportunity to even be able to get in the market, or you end up in a condo instead of a single family house. And then really explaining the cost of waiting. And what I mean by the cost of waiting is doing the numbers with people. So let’s say you’re buying a $500,000 house and you wait two years, so you’ve paid two years worth of rent, the average rent in Denver is over $2,000. But let’s say you’re paying $2,000 in rent the first year and 2300, the second year, you’ve now wasted not invested $50,000 in rent that you could have spent into a mortgage. So you’ve burned 50 grand plus the home you bought wouldn’t be worth 500, likely it’s going to be worth 560 or 570. So you’ve lost $70,000 there. So you’ve effectively lost $120,000 By waiting two years. And a lot of the people that I’m talking to maybe they make 90, maybe they make 70, maybe they make $110,000 a year, but when you’re talking to somebody about losing an entire year’s worth of income in two years, that’s significant for most people for pretty much everybody. I don’t care who you are. And so really explaining to them that the cost of waiting is always greater than the cost of investing. Now, because we’re not selling cars, we’re not selling hot dogs, we’re selling an asset and it’s an appreciating asset. Even if the price dips in the first year. If you look over time home values go up, we’ve recovered more than the value loss since 2008. We’re up above the 2008 numbers. And you might think 15 years is a long time. But those of us that are a little bit older realize 15 years goes by really really fast and homes that are 500,000 today in 15 years are going to be $800,000, $900,000 in a lot of markets and so it just does not make sense to wait if you can afford to buy a house and you are renting, you are making a financial mistake for most people.
CORWYN:
It is interesting. You say that because I’ve had countless conversations with people over the past two or three years ago said the same thing. I’m waiting for marks and crashes there’s no way it’s going to keep doing this. There’s no way, there’s no way and I’m like okay, quote unquote as the old folks say please smash if you want to because that’s exactly what happened now can’t even buy a home at all because you didn’t take advantage and do it when you cut out we’re seeing people with housing payments that basically close someone a year and a half ago and you close that same price point now and and monthly mortgage is almost 20, 30, 40, 50% more, depending upon you know, I’m saying so many variables. So Scott, thank you for sharing that. You say that Denver’s between and Seattle mountains all around you?
SCOTT:
We got mountains to the west. We’ve got plains to the east. So we are expanding East. I grew up in Phoenix. And so I remember Buckeye as a town that’s just outside of Phoenix. And I remember when we’d go to visit my grandfather’s grave in Buckeye when I was a kid, you would drive for a distance to get from Phoenix to buckeye. Now Phoenix is one solid city all the way to Buckeye with different names, right, all kinds of suburbs. And that’s how over the next I would say 10 to 15 years Denver’s gonna be one solid city all the way from Castle Rock to Fort Collins. That whole the whole Metro is just expanding and filling in and so we have a lot of building but not as much building as some other cities just because we can go north and south, we can go east we’re just we bump up against the mountains in Boulder to the west.
CORWYN:
That is priceless and our listeners are everywhere. Some are in major cities across the US we have people in other parts of the world and we see that more so in like major metro but where you are if you have land around you there it’s gotta go there like I jokingly say so a South Carolina you’re familiar with Charleston, we are coastal, and then you have Columbia which is the center of this state. I’ve been saying this for years that Charleston and Columbia are going to meet in the Orangeburg areas about halfway between if you drive along Interstate because we can’t go to the ocean, so we got to go this way you have to mountain so y’all can go necessarily to the mountains as these as you can go back towards the plains, if you will. So it’s the same premise you want to have municipalities begin to stretch out. And that’s something that people need to understand. And recognize that if you’re in the path of development, you’ll have a great day. If you can move with development, you will have it better. So that’s where it is, where the opportunities are, where you can serve. But I want to know if you could articulate this, why do you do what you do
SCOTT:
I help people buy and sell houses, honestly, because I feel like it’s the best service out there. There is nothing better than helping somebody own a home, that they’re going to raise a family and that they’re going to spend their life. And to me, that’s the greatest service that we can do. It just so happens that I’m lucky. It’s a good income as well, right? Like the thing I love to do also happens to be paid well, the other thing is the reason that I invest is because honestly, my therapist says that I have a problem with boredom. And so I always need something that I’m working on. And so what doing real estate allows me to do is spend time working on tasks that drive my passion, while I get to help people do the thing that is most important in life, which is shelter, right? If you can help provide somebody with great shelter, and at the same time, provide yourself a good income. There’s just absolutely nothing better than that. And I love helping people. If you ask any of my agents, yes, getting my clients, that’s the one thing they’re going to tell you is that I really get a passion out of helping out
CORWYN:
Awesome. So Scott, before I get to what I referred to as Mike, that question I want to ask you to share with our listeners and our viewers your contact information. So obviously all my social will have it. But for those that may be in the car listening or what have you, how can they get in contact?
SCOTT:
first of all, you can call me 720-252-7037 I’m one of the few realtors who always answers their phone. I’m up early, I’m up late, I don’t care. Our website is you1stinfinity.com. And its first, like first place. The number ones like CMT, like Tom, so y-o-u 1 s-t infinity.com. And those are the best ways or my email Scott@youfirst.com. So you can reach me anytime of the day or night. And if you’ve got a real estate question, I’m happy. This is a now business. So of you waiting six months doesn’t help waiting to tomorrow doesn’t help if you’ve got a real estate question, get it answered now. And I’d rather you call me and ask me then spend one minute wondering
CORWYN:
I like that. That’s profound. I appreciate that. So Scott, I call this, my mic drop question is all in his always that past like 2020? All that stuff? So the question really is just that if you could go back to a former self whenever and let them know where you are. Now, what would you go back and tell them that would have you significantly further along than where you are now?
SCOTT:
Yeah, it’s really simple. I would have told them that the day I got out of the army to get my real estate license, I would have not done mortgages, I would have gotten my real estate license in 1996. And I would have been doing real estate, I think that is probably the most profound advice I could have given myself. Because if I had started helping people with home buying and selling in ‘96, I would be in a very different place. Now that being said, I would not change one thing that happened in my life because I have a beautiful 14 year old daughter. And if my life hadn’t happened exactly the way that it happened, I might have had a different kid, but I wouldn’t have her and I wouldn’t trade her for the world.
CORWYN:
So awesome, man. And that is a great plug, man. Sometimes we look back and we wish to think we’re different, but they’re the way they are for a reason and a purpose. And once we have gained that insight, we do so much better. So thank you for sharing that. So Scott, look, I appreciate you taking time out of your busy schedule today. I appreciate you being here on our show. We look forward man to revisiting you in the future, and hearing about your exploits and all the wonderful things that’s going on out there in Denver, Colorado. So again, from the bottom of my heart, thank you for being a part of the Exit Strategies Radio Show family. And I just want to say we appreciate
SCOTT:
Corwin. Thanks for having me. It was a pleasure. And I appreciate you just as much back you didn’t have to have me on and I value the fact that you did. So thank you very much.
CORWYN:
You’re quite welcome, well for our listeners, guys, look. Y’all know, y’all know y’all know, y’all know y’all know what I say? Y’all know how I feel. Always put the two of those things together and always pave it and I’ll lay it out to you this way which is I love you. I love you. I love you. We gon’ see you guys out there in those streets.
