Be Nimble in Real Estate: Pivoting From Fix-and-Flip to Fix-and-Rent, REO Work, and Market Cycles

Larry Myer (00:00)

So I had to take a $5,000 cash advance, all the money I had from a credit card, and I bought my first house. I painted it, and within a couple of weeks, I had my first Section 8 tenant at $800 a month. And I said, boy, howdy, I like this. So one turned into two, two turned into three. I had no more money, so I figured out, well, gosh, seller financing might work.

Kristen (01:57)

Welcome back to the Real Estate Pros podcast. I’m Kristen and I’m here with Larry Myer, who is a real estate investor out of Kansas City. He’s been in the game for 40 years and he’s transitioning into coaching. So we’re going to get a lot of great coaching advice from him. So I’m excited for him to be here. Thanks for being here, Larry.

Larry Myer (02:14)

Good morning,

Kristen. Thank you for having me.

Kristen (02:17)

Incredible. So I mean, you’ve had quite a, I mean, quite a career in the real estate world. What got you into it in the first place? I would love to kind of go back to the beginning.

Larry Myer (02:29)

Interesting story. I out of college, I was in Houston. I moved to Houston, Texas. Worked there for a while. Came back to Kansas City in the early 80s when interest rates were 20 % and no gas, whatever. So my brother and I decided to buy a Mexican restaurant. I don’t even like Mexican food, so that really had no recipe for success. But while I was there, I was talking to one of the customers.

Kristen (02:55)

No personal upside. ⁓

Larry Myer (02:58)

I was talking to one of the customers who came in with paint all over him every day. And I said, what are you doing? And are you a painter? we, you know, the inside of the restaurant can use a coat of paint. says, I’m a real estate investor. You know, I don’t hire out for anybody. It’s like, okay. So I started talking to him. says, well, I buy houses in the central core of Kansas city, Missouri, and I rent them out through the section eight low income housing program. So as much as I hated being in the restaurant business with my brother,

Teach me how to do it. I’m in. Teach me how to do it. He gave me the address. Here’s where we’re working. Sign up tomorrow. Come out tomorrow. ⁓ You’ll work on the house. I’ll teach you what I can. And then when we’re done, I’ll show you how to get it rented. And I will also help you find your first house. ⁓ I went through. We finished the house. He found another house for me down the street. I had no money because it was all sunk in the Mexican restaurant.

Kristen (03:33)

Yeah.

Larry Myer (03:56)

So I had to take a $5,000 cash advance, all the money I had from a credit card, and I bought my first house. I painted it, and within a couple of weeks, I had my first Section 8 tenant at $800 a month. And I said, boy, howdy, I like this. So one turned into two, two turned into three. I had no more money, so I figured out, well, gosh, seller financing might work.

So I learned how to do seller financing. And then I…

grew and other people called me and said, well, gosh, your houses are all nice. Can you take care of mine? I started managed for people until I got a cease and desist order from the real estate commission because I didn’t have a broker’s license. So I got my broker’s license and, and, uh, you know, fast forward to mid nineties, I owned and managed 2,500 units, uh, all over Kansas city. So I’ve since scaled down. Um, I just turned 70. So my son took over the business. Um,

Kristen (04:38)

out.

How?

Wow.

Larry Myer (04:55)

and I’m getting ⁓ into the teaching world because someone, you know, that’s how I got into it and I’ve had a very nice living from it. So, there we are.

Kristen (05:57)

That’s incredible. mean, 2,500 units. That’s a lot of units. That’s incredible. talk about kind of, yeah, talk about, I mean, you sort of touched on it, but the importance of having that coach. mean, that was so lucky that someone was able to or willing to give you so much of their time and really show you the ropes. ⁓

Larry Myer (06:02)

That’s a lot.

It really was. It was really nice. ⁓ You know, free lunches for quite some time didn’t, you know, didn’t slow the process down at all at the restaurant. But it was nice because back in those days, I’m showing my age. There was no Internet. There was barely computers. There were no gurus. There were no mentors. There were no real estate clubs. So you’re kind of out there just.

It was the Wild West and you’re out there learning on your own and you tried it. If it worked great. If it didn’t, no, look what trouble I got into and let’s call the attorney to get me out of it. So, you you don’t know what you don’t know.

Kristen (06:51)

Yeah.

Right, of course. mean, and it’s so important to have a coach because you’re going to make these mistakes along the way anyway. And you can save a lot of money if you have someone helping you out. I mean, if you pay for coaching, you’re probably going to save a lot of money in the long run.

Larry Myer (07:14)

In the long run, you will. ⁓ I wish I had ⁓ someone other than paying an attorney to ⁓ tell me what I should have done. It would have been nicer to have someone along the way telling me. then, you know, later on, the real estate clubs were forming. And now you’re you know, you have the opportunity to network with, you know, folks that have been in it longer than I had and on and on. So it really helps.

And it’s worth it. It’s worth it.

Kristen (07:47)

Yeah, and I know that you have, know, to be able to manage so many units, you must have incredible systems in place and incredible teams in place. How did you go about setting all those systems up?

Larry Myer (08:01)

Well, excuse me, again, ⁓ trial and error. ⁓ During that timeline, I was really heavy into renovation and management. ⁓ And so I had a lot of ⁓ contractors, a whole crew just to do tearouts for apartment buildings, ⁓ the electricians crews, the plumbing crews. So they were all, it’s just keeping, again, in those days, you didn’t have many… ⁓

Kristen (08:04)

Yeah.

Larry Myer (08:30)

you know, CRM programs or whatnot. So it’s just, you know, on a big chief tablet and a crayon. And, ⁓ you know, you’re just, you know, it’s just moving chess pieces around all day long and keeping track of rentals. ⁓ And I had, you know, I had some inside help bookkeepers and you know, whatnot and other leasing agents, but it was a lot of, mean, I worked nonstop every day.

Kristen (08:55)

Yeah. What are some of your best tips for hiring the right people? I’m sure that that’s probably the hardest part of the job, you know, throughout your whole career. What are your tips for making sure you have people that really, you know, mesh with the systems you have in place and mesh with the values you have?

Larry Myer (09:15)

Right. Well, so as far as contractors, you know, now I’ve been out there so long. mean, I, you know, there’s a whole host of guys that I’ve either worked with or there’s a stable. They’re all independent contractors. So I call them when I need them. But in the beginning, I found out that if I go to Home Depot, I needed a painter. I would go to Home Depot and I would just hang around in the paint aisle and I’d look for a guy that had paint all over him, but not a lot.

and he was buying multiple five gallon buckets of paint. And I’d walk up to him say, well, hi, are you for hire? And I’d introduce who I am and what I do. And I would get a card. And now I got myself a painter. And the same thing with electricians. You hang out in the electrical aisle and guys that’s buying 300 feet of wire and all that. And sometimes I’d sit there all day, but.

Kristen (09:45)

you

Larry Myer (10:42)

That’s how you find guys that work in the area that somebody was already hiring them. And then I would check out their references and you give them a try. Some guys work. Some guys is just, you know, well, here, this, didn’t work out. Let me pay what I owe you. Get off my property. Don’t ever call me again. So, you know, it’s just, a lot of it’s just trial and error.

Kristen (11:03)

Yeah, absolutely, and getting rid of the wrong people quickly, I’m sure.

Larry Myer (11:09)

There are, you know, there’s good people and then there’s bad people. you know, and then I, you know, then as we’re working on projects, they learn the way I like to do things and I like things done right. Do it once, don’t come back, measure twice, cut once, that type of thing. So it’s, it’s a learning process. And now I’ve got guys that have been with me. My lead carpenter is 81 years old and he’s been with me for probably 20 years.

⁓ And most of the guys I have, I have a guy that’s putting in a furnace in another house we’re doing today. He’s been with me for 12 years. So, you know, as you find the guys, you know, you use them. Fast pay makes fast friends. ⁓ Pay them as soon as the job is done and make sure they get the materials they need and they can finish the job and be surprised when you call them and you need them, they show up.

Kristen (11:54)

Bye.

Yeah, yeah, amazing. And then, I mean, that must be so fun for you to kind of pass down your legacy to your son as well. And now he’s taking over.

Larry Myer (12:12)

Yeah, he’s I started him out. ⁓ You know, actually he started out. was a professional musician and toured all over the country and provided reasons that you know that’s never a long term. ⁓ It’s never a long term plan, so he came back and ⁓ he got his real estate license and I started him out working on one of the construction crews on a house and he did that for over a year and then so you know he kind of know wangled into the business as time went on and.

So now he knows, he’s still learning, but I was dealing with a lot of investors. ⁓ I’d get him in on the conversation. So he’d learn how to, what is an investor looking for to buy a house? And how do we do this? How do we do that? he’s, he’s still learning. He’s still early thirties, but he’s still learning, but he’s doing, he’s doing, he’s doing good work. This one is to the point where I can kind of,

start out on a side business and step in when I’m needed.

Kristen (13:17)

Yeah, absolutely. So, you you’ve been in the game for 40 years, you’ve seen so many ups and downs with the market. I would love for you to talk just about the general opportunity of real estate and what you see the market kind of like where you’re seeing it headed now, because I know there’s a lot of people who are confused or have little caution entering the market. I would love for you to talk about that from the perspective of having, you know, gone through so many upturns down.

turns.

Larry Myer (13:48)

Sure, yeah,

I think that the main thing is you have to be nimble and you know, just because you started out, I want to wholesale houses, that’s all I want to do. Well, good for you. ⁓ You and 10,000 other people are trying to do the same thing. So, you know, you have to be nimble and you have to keep aware of what’s going on for a while. ⁓ I had an opportunity pop up. ⁓

with the crash in what was it, 2009, 2010. And I was the broker of record for Fannie Mae for all of their foreclosures. And all I would do is do lockouts and all that. I stopped my one business and that picked up on another one and that kept me busy for almost two years. So you have to be nimble to opportunities. Maybe now is not, and I’ve found it’s harder to sell houses now.

but there’s a huge market for rentals. maybe we stop, we had talked to my son, maybe we stop doing the fix and flips and we’re doing the fix and rents and hold them for a while and then, you know, work with a tenant that’s in there to buy the house. There’s lots of ways they can do that. So you gotta be nimble. But I think now it’s turned into a more of a buyer’s market, at least here in Kansas City and the markets I’m in.

So, you know, again, that’s like I we switched to, you know, fix and flip to fix and rent. So you just have to be nimble and keep your eye on what you’re doing. And if you’re locally, you know, start going to meetings and, you know, and read the paper, watch the news, you know, all sorts of ways to keep caught up.

Kristen (16:17)

Yeah, I think that’s good advice. There’s so many different strategies within the investing space. And I think people like to use blanket terms like it’s a bad time to enter the market. But I mean, to your point, you just kind of adapt to it.

Larry Myer (16:32)

You have to, you have to be, you have to be nimble. ⁓ you know, for a while, all we were dealing with was out of state investors. Well, you know, now there’s all sorts of, ⁓ national clubs and these guys belong to, and, know, they, you know, they don’t need me anymore. ⁓ that’s fine. ⁓ so yeah, you have to be nimble and you have to, know, you’ve got to be a chameleon and you got to be able to change colors and, to kind of stay with it if you want to stay in this business.

Kristen (17:03)

Absolutely, I think it’s really good advice. I mean, there’s so many different things to consider. I think a lot of people with investing, don’t necessarily think about the core reason or what they want out of it. It’s kind of just like, I want money. But there’s so many different strategies that you can implement. It’s really important to go deeper and figure out what you’re looking to gain from it, what kind of success you want from it, and to be really thoughtful about how you move through it.

Larry Myer (17:33)

Right. there was a guy that all I want to do is foreclosures. I want to be in the foreclosure business. so good luck. ⁓ You know, that’s little more, you know, that’s a little more difficult. ⁓ Or I want to be a wholesaler. Like I said, you and 10,000 other people, you know, that’s where that’s where everybody wants to start out with, because everybody makes it sound so easy. I’ve never been able to do it’s not been one of my things. So it, you know, you just.

There are a thousand ways to make money in real estate. ⁓ We could be here all day going on about that. Find something, find your niche that nobody else wants to do and be better at it than anybody else.

Kristen (18:17)

Yeah, absolutely. When you were starting out, you take, did it take you a while after buying that restaurant? Did it take you a while to kind of figure out what your niche was?

Larry Myer (18:28)

Well, I knew that I I I worked in the central in the urban core of Kansas City, Missouri. And because again, I that’s all I could afford. I had no money in houses at the time. House is down there. You could buy houses all day long for a couple thousand dollars. So and there was no shortage of empty houses or people that didn’t want to be down there anymore.

⁓ And I had to get used to going into neighborhoods that nobody else wanted to be into and yes I’ve been shot at yes I’ve been attacked I’ve got I mean you name it ⁓ for the first couple of years I had to pay a guy to just Drive in the car with me so I wouldn’t get shot. So, you know, it’s it’s You know looking back on it. Well, that was pretty stupid. But at the time it’s like this is this is my world I can’t be in you. I can’t afford anything else. So and you learn how to

adapt, you learn how to keep your head on a swivel, you learn and you know, last 10 years, I’ve had 15 years, I’ve had nothing. Nobody even gives me the time of day down there anymore. So, you know, after a while, you know what you’re doing and it’s not a big deal. But yeah, there’s everything is a learning curve. So you just have to, you know, keep your ears open and your head on a swivel.

Kristen (19:43)

Yeah, absolutely. Wow, that’s, I mean, that’s scary that you had to do all that.

Larry Myer (19:48)

Again, looking back, it’s like, ⁓ that’s pretty, really pretty stupid. But at the time it’s like, well, cost of doing business, know, whatever. So, ⁓

Kristen (19:52)

Yeah.

Yeah,

and what’s, and you know, of course, you know, everybody has their mistakes they make or things go wrong. What’s your mindset around that? How do you keep pushing forward? I think that it’s easy to give up in this business.

Larry Myer (20:14)

Well, it is very easy to give up in this business and it just depends on if this is what you want to do and you want to be in the real estate business, then I mean, you’re going to I don’t care who you are, you’re going to make a wrong decision. You’re to buy the wrong house. You’re going to you’re going to hire the wrong contractor. You’re going to sell it for the wrong price. Again, we could be here all days with me telling you all my woulda, coulda, shoulda’s and all the stupid things and you know, you know.

For a while, I thought I could fix anything. And I bought an apartment building where if you’re on the first floor, you could put a bowling ball down at the front of the building and it would roll really fast down to the back. That’s how settled it was. And now it’s just a vacant lot and I lost a lot of money. you know, it’s but this is what I do. you know, and at the end of the day, you tally up the your successes and you tally up your failures. And hopefully your successes are more than your failures and you learn from them.

Kristen (20:54)

you

Larry Myer (21:13)

You learn that I can’t fix everything and you learn that there’s some houses that just not worth buying, that they need to be torn down or they need them, it’s in a bad neighborhood and I don’t want to be in there. I don’t want my guys in there. I don’t want me in there or my son especially. So easy to learn.

Kristen (21:20)

Yeah.

Yeah, just because it’s available doesn’t mean it’s a good opportunity or something you should explore. Well, think this has been, yeah, I think this has been wonderful. I think you’ve given a lot of great advice on the perspective of the market and just the importance of coaching. I would love for you to kind of, as we wrap this up, it might be hard to boil it down to one, but what would be a piece of advice that you wish you learned earlier in your career that you can share with everybody?

Larry Myer (21:37)

There you go.

Oh

my goodness. Well, the main thing is, and it’s tried and true, don’t do business with family or friends. know, that’s everyone tells well, if you need money, sure, go to your friend. Don’t do that. Don’t do that because even though if you tell them, well, this is still an investment, things can go bad. And if you do 20 of them, the one

Kristen (22:13)

million.

Larry Myer (22:28)

time you borrow from your mother-in-law, that’s the one that’s going to go bad and it kind of happens. ⁓ it’s yeah, so you know, church and state keep everything distant, you know, separate, keep good records. And, know, tomorrow is always another day and ⁓ just keep baseball term just keeps on wood.

Kristen (22:49)

Yeah, I think that’s really good advice. think, yeah, there’s that fine line there because people starting out, don’t know where to fundraise, but I agree. It’s a lot of pressure to take on the money of your family and friends.

Larry Myer (23:02)

Yep, needless pressure.

Kristen (23:06)

Yeah, exactly. Just adding one more thing onto everything. Well, thank you so much for doing this. Please tell everybody where to find you and how to work with you.

Larry Myer (23:15)

⁓ Kristen, my name, again, my name is Larry Myer. ⁓ Y E R. ⁓ you can find me at larry at real estate hyphen mentor.com.

Kristen (23:29)

Awesome, everybody I really encourage you to check Larry out and work with him. I think he has a lot to share and a lot to offer. So thanks so much for being here, Larry.

Larry Myer (23:39)

Thank you so much, Kristen.

Kristen (23:42)

And thank you everyone for listening. Hope you learned a lot, got some inspiration for your own business and maybe inspired you to get some coaching and get some help. So thank you so much for listening and we’ll see you back next time.