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Show Summary
In this conversation, Carson Leonard shares insights on achieving rapid success in real estate through setting high goals and following successful mentors. He emphasizes the importance of ambition and learning from others to reach impressive deal numbers.
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Investor Fuel Show Transcript:
Carson Leonard (00:00)
Definitely fear. And I want to say it’s this actual fear like, ⁓ am I going to be able to repay these loans? You your assets are going to be pretty sure to buy. But it’s big commitments. So when I hired my first acquisitions team to go talk to more wholesalers, go buy people’s deals, I had this guy, he’s got a wife, an expensive apartment in Orlando, Florida.I’m like, I got to take care of this guy. He’s about to quit his job and come work for me. So that was a big, scary commitment. That’s why I always wanted to buy 20 deals a month. That’s been this number in my head. I’ve been wanting that since December. In most homes I’ve also seen those four and then half the months is zero. So it’s this, it’s, it’s a commitment to a lot of work and you have to accept that you must do it. If you want it, you must do it.
Erika (02:30)
Hey everyone, welcome to the Real Estate Pros podcast. I’m your host, Erika, and today I’m excited to be chatting with Carson Leonard. He’s been making serious moves in the fix and flip space. Carson, I’m glad to have you here.Carson Leonard (02:44)
Thanks for having me on. Appreciate it.Erika (02:47)
I think ourlisteners are really going to take something away from how you’re approaching and scaling folks with such an impressive start. So, you know, let’s dive in. Carson, can you share more about what your journey was like to real estate and flipping?
Carson Leonard (03:03)
yeah, of course. It was actually not the way you’d expect somebody to get into real estate. I didn’t know what I wanted to be, ⁓ but I remember I was in high school prepping for college. I think I wanted to be an accountant or some kind of financial planner or advisor. And I picked up Brandon Turner’s book.on investing and managing rental property. It was called the book on investing rental property by Brandon Turner, the bigger pockets guy. And that book, you know, they all say the bug bites you somehow in real estate. That was the bug that bit me that book right there. So I was just infatuated with how it works. And I just read more books by bigger pockets than some other people too. And yeah, that’s what got me into real estate. ⁓ I started
in 2021 was when I actually started taking action. And, you know, I think the natural progression these days in this market is a lot of people start wholesaling and then they use that as a pedestal to get into fixing flipping, which is what happened to me. I never thought I’d be flipping. But after selling some good deals as an agent and a wholesaler, just seeing what my buyers were turning around selling for, I realized, OK, I’m in the wrong side.
You know, something I’ve heard is everybody’s cell phones to hate, but nobody buys. And I like that stuff with me. It makes sense. And sometimes honestly, I can see why just for the headaches.
Erika (04:37)
Yeah, yeah. the fast forward today, Carson, tell me more about the markets that you’re in and the kind of opportunities that you’re seeing where you are.Carson Leonard (04:46)
So my company, we’ve been flipping homes all over the Midwest. So Illinois, Tennessee, Indiana, of course big in Indiana, Michigan and Ohio. And then we’re just avoiding very low and very high value markets. So we stick in thehousing, 1950s, 1960s and newer, something very common. You’ll see most many hedge funds, buying newer, nicer properties. And then…
but I’m buying a lot of homes that are 70 to 100,000 to be doing. And also all over Texas and Georgia and parts of Florida.
Erika (06:14)
What’s it been like working in so many different states? How do you look at each market, analyze it, know if you’re getting a good deal?Carson Leonard (06:26)
So when I was wholesaling, I never cared where that next deal was. I was operating a lot of what they call the disboat. was disposing, dispositions, doing those types of deals. I’d always get the buyer using this platform called Investor Lift. So I’d go find the buyer, we’d split the deal, you know, whatever arrangement we had. And rarely I got the deal. I started getting the deals. When I got good, I started doing disboat. When I started doing disboat, I was selling deals wherever.So in Florida, Arizona, Indiana, a lot in Texas, and you start learning how to call phones and how to really run the numbers on them. And what you’ll find is that markets across the entire United States are very consistent. You know, you’ll never have two alike properties. This one sells for a hundred K and this one sells for two hundred. You know, this maybe this one sells for one seventy. This one sells for one seventy five. You find the stability.
And general market trance every bit every state ever see even every zip code has their trance on appreciation and stagnation and depreciation. Three types of markets and.
Yeah, I essentially run cops and then there has to be at least three to five cops that clearly show what my subject property should sell for. Otherwise, I can’t do it without that conviction that, okay, we’re going to get this number from the property and lease. I can’t do it. There’s no.
Erika (08:02)
it comes to flipping in different states. Have you noticed anything different in the market that you might focus on certain things when you flip or is it pretty uniform across the board?Carson Leonard (08:14)
Definitely not uniform. I mean, you have the average market, but I’ll give one deal for instance, I own a house ⁓ near this small, it’s a super small town near another small but slightly bigger town called Portra, Texas. And this area has been falling off a cliff in terms of population. So what I noticed is that just a couple of years ago, homes were selling like mine from 250 to 260.So that would really trick a lot of people into thinking, okay, yeah, this home should sell for 250. But when a market of 500 or so people loses 100 people, it’s extremely significant. In fact, most of those guys are home buyers. So I could only look at sales that were in the last couple of months. Fortunately, there were a couple, I wouldn’t have bought it. And then what I did was I priced in even further potential depreciation, because that’s what that…
But we’re in the fix and flip business. We’re in and out typically in four to six months. And that’s a freak example. On average, you can rely on the comps to not go up and down as long as we don’t have any major market events.
Erika (09:33)
Yeah, and with fix and flips, time is of the essence. You don’t want to be sitting on a property for too long. How do you run your business to ensure that you’re in and out of a fix and flip with enough time?Carson Leonard (09:47)
Yeah, and check this out. I’m the perfect guy to talk about that because I’ve made those mistakes. I’ve had successful flips where like bang, bang, bang, in and out contractors and everyday. And I’ve had unsuccessful flips where for whatever reason, I didn’t get enough hard money financing to complete the flipand running multiple, my cash is tied up, my cash is bleeding every month from the interest payments. You know, that flip is going to pause until you’re able to get the financing for it. ⁓
which happened with mine. So you have to make sure that you have plenty of hard money financing. And what I mean by hard money financing, guys, is when you have these fixed and properties and you buy them with a lender, typically you’ll find ones that will finance up to 80 to 90 % of your purchase price and 100 % of the renovation financing through the construction job. what I used to do, which I changed, this was a mistake of mine.
When I thought that we’d only need $25,000 to fix up a property and this is when I was brand new, you know, I would give myself $30,000 to $35,000 as a budget trying to be conservative. Even though these deals were good and they could have qualified for let’s say $50,000, definitely a lot more than what I was asking for. The fact that it qualified for that, I should have asked for that because there’s a lot of lenders that don’t even charge you interest until you borrow that money. So I could have…
Without any kind of penalty, extra fees at all, I could have borrowed more money or requested more available credit on that property due to the appraisal that it had. They typically give you 75 % loan to ARV. Whatever your ARV is, they’ll give you up to 75 % to loan. And I could have requested way more. Because I didn’t, it required me to either sell off assets and liquidate to finish that flip or I’d have to phone a friend.
or make new friends and fund those friends and request a private money loan at a much higher interest. Which is okay, it works, but you don’t want to do that. You want to start up front and have that financing plan. You have to have your project plan and your financing plan to be able to finance the whole project.
Erika (12:40)
Yeah, absolutely. And Carson, you’ve done an impressive amount of deals in a short amount of time. What would you say has been the secret behind that?Carson Leonard (12:53)
⁓Honestly, having super high goals. never had pierce the flips. I didn’t know what was capable. I just followed a couple of guys that this one guy, Bill Allen, you know, he was saying he was doing 200 a year or 150 a year. So I was like, oh, shoot, how can I do 150 or 200 a year? I’m not doing those numbers. The most properties I ever bought was four homes last December. So 2024 December, I bought four homes.
But it was just, it was just sheer wanting to make a lot of money, ⁓ not having a lot of money beforehand, you know, knowing a lot of wholesalers. just see this opportunity. It’s all around me because that’s been my network since 2020.
there were so many deals and there were so many people that have money and started pulling strings together so they started buying up these deals and then I made ⁓ a business out of it.
Erika (13:56)
And Carson, talking about the wholesalers that were in your network, what kind of advice would you give to someone new to real estate and they need to build their network? How should they start?Carson Leonard (14:09)
started Facebook groups. There’s a new app called Discord. It’s not new, it’s gaining popularity in the real estate industry now. And there are plenty of great Discord. So first one I would join is called REI Revolution. It’s free and you have like hundreds of guys closing a lot of deals. It’s ridiculous. you can get in there and just start talking to people. They have these voice chats. You can just click and this is online too.So it’s not like you have to drive anywhere, pay in a van, or any kind of boring zoom. You just get in any time you want and say, hey, let’s talk up real estate. But in building your network, what you’ll find is that
your network is generally going to be at or below your level. So when I started, I was just talking to brand new people, brand new wholesalers.
And as I started doing the work, my mind would filter who I kind of wanted to talk to because I was always looking for something. When you’re networking, you need to like know what you want. Okay, I want to start getting deals. I want to start building up my investor list. And when you have that goal in mind, it
kind of automatically filters who you start talking to. But really just talk to everybody. And what I’ve always said is if you go talk to 200, 300 people, you will walk out with two or three good friends that you like that are doing the same thing that you’re trying to do. And you start doing business with them.
Erika (16:22)
That’s really awesome. Well, Carson, with where you’re at right now, I have to ask what’s next on the horizon for you? What’s your vision for investing?Carson Leonard (16:37)
to keep growing, keep expanding, keep pushing, ⁓ close all of these deals that I’ve got right now, exit out of the properties by the next cycle of flips and establish a track record where I can show my first deal, my worst deal, and then my first series of flips that were slower, but still good, and then the start series of flips, which are good and they’re fast. And I see myself scaling.slowly the Shirley scaling going from one to two fix and flips a month which I’m currently acquiring to four or five plus and beyond.
Erika (17:16)
That’s exciting. What would you say is the biggest challenge that you’ve encountered every time you’re kind of looking to reach a new limit, get to the next level?Carson Leonard (17:26)
Definitely fear. And I want to say it’s this actual fear like, ⁓ am I going to be able to repay these loans? You your assets are going to be pretty sure to buy. But it’s big commitments. So when I hired my first acquisitions team to go talk to more wholesalers, go buy people’s deals, I had this guy, he’s got a wife, an expensive apartment in Orlando, Florida.I’m like, I got to take care of this guy. He’s about to quit his job and come work for me. So that was a big, scary commitment. That’s why I always wanted to buy 20 deals a month. That’s been this number in my head. I’ve been wanting that since December. In most homes I’ve also seen those four and then half the months is zero. So it’s this, it’s, it’s a commitment to a lot of work and you have to accept that you must do it. If you want it, you must do
There will be.
very large amount of support work that you have to do. I mean paperwork, finding contractors, sending that there to waste your time. You’ve got to do it again and again. You’ve got to let this guy do some bad work so you can find the next guy who can come fix it. You might have to borrow some money in order to make that happen. There will be a lot of steps that you have to do. There will be hiccups, there will be delays, there will be unhappy partners, there will be…
surprise work that needs done on a home. start ripping up the walls, like, ⁓ those pipes are all jacked up, you know, or all those wires, they’re live open wires, they shouldn’t be like that. Or you’ve got GFCI covers in the kitchen, but they’re not actually grounded. So you got to run another wire, all these little things, multiplied by however many deals you’ve got going on. So, but it’s good. It’s very, very, very good. Once you get it done, it’s like the end of the day, you just went out that big sky.
and you have to get ready for the next day. That’s what I’ll say.
Erika (19:29)
Totally. Carson, this has been great. Before we wrap up, if somebody wants to reach out, connect, collaborate with you, how can they reach you?Carson Leonard (19:42)
Reach out to me on Facebook. I’m Carson Leonard. On Facebook, reach out to me on Discord. And REI Revolution, Real Estate Investors Revolution. I’m Carson. I got the gold name. And reach out to me there. I’ll buy your deals. I’ll buy deals with you. Or I’ll show you how to do deals. you later. Street top. Hey, thank you very much, Erika. I appreciate this. This was nice chatting about the Fix and Flip business.Erika (20:03)
clever.Carson Leonard (20:11)
Nice to come on, first time I’ve done this in a while.Erika (20:14)
Yeah, we’re glad to have you and you know, Carson, we need more people in this space who have the hustle like you do. It’s been great to hear your advice and your story.Carson Leonard (20:26)
Absolutely.Erika (20:28)
And for our listeners, if you enjoyed this episode, make sure that you’re subscribed to the Real Estate Pros podcast. We’ve got more conversations lined up with pros like Carson, who are out there building fantastic real estate businesses. We’ll see you on the next episode.
