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Show Summary
In this conversation, Lamond Allen shares his journey into Real Estate Investing, starting from his early experiences during the market downturn to his current strategies in managing rehabs and exploring new construction opportunities. He discusses the importance of adapting to market changes, the dynamics of the St. Louis and Cleveland markets, and his innovative approaches to deal flow and project management.
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Investor Fuel Show Transcript:
lamond (00:00)
At the peak, probably had eight to 12 rehabs going on simultaneously between ⁓ three to four investors. And how I managed my crews, I do everything by system. So it’s almost like a assembly line, I’ll say. I don’t really manage crews, I more so manage trades. So what I would do is I would have my demo guys go in there.They may only be in there two days. My electrician, he only need the house for a day and a half. My plumber may only need the house for a day and a half. You know, my painters only need the house for two days. You know, so what I did was I set up the systems which allow my guys to go from house to house to house to house, you know, and don’t have to try to manage a hundred people in one house.
Dylan Silver (02:25)
Hey folks, welcome back to the show. Today’s guest is a single family investor, properties under four units, specializing in fix and flip projects for investors in both St. Louis and Cleveland. Please welcome Lamond Allen. Lamond, welcome to the show.lamond (02:43)
Hey, thank you for having me. I’m excited to be here.Dylan Silver (02:46)
It’s great to have you on here and as someone who’s worked a lot in this space as a wholesaler and collaborated a lot with investors throughout the state of Texas, I’m always interested in hearing everyone’s background and how they got into real estate. How’d you get into real estate?lamond (03:05)
Actually, was a stand up late night one day I saw a carton sheets. I don’t know if I’m saying my age now, but I actually saw a carton sheets commercial like in 2008 during the downturn. And from that commercial, I bought his course and I made an ad on credit lists looking for different investors. And I met this one investor and just started doing it from there.Dylan Silver (03:31)
This was during a time when people were panicking and you got into the real estate space. ⁓lamond (03:38)
didn’t even know people was panicking. Like, because I got in the real estate space at that time and was only dealing with investors who was buying those five, $10,000 houses, I thought the time was good. I thought that, you know, in real estate, ⁓ man, this is great. You know, you could find houses for $10,000. At this time, I was having different investors pay me to do rehab for them, because I started off really as a rehabber for these investors, even thoughDylan Silver (03:40)
Yeah.lamond (04:08)
of the quarter sheets program took us how to be a wholesalers and things like that. You know, I really started off as being a contractor. So what I would do is I will find them the properties and in the bid it was okay, you can buy the property for 5,000. It’s a $15,000 rehab. You’ll be all in at 20. So that was really my first way of getting to real estate. And I’m doing seven to eight deals like that a month. So I’m thinking that everything is great. So.Dylan Silver (04:38)
Did you have a, you mentioned you were the contractor on these deals. Did you have a background in trades or in rehabbing homes? How did you have the skills to do that?lamond (04:50)
had a backgroundin heat and cooling. So I knew that my business in heat and cooling, it was starting to be kind of, you know, it’s seasonal. So doing one of my off seasons really when I started studying cards and sheets program, you know.
Dylan Silver (05:04)
Very interesting.So you’re doing a bunch of deals during the downturn. You’re connecting a lot with investors. You mentioned some prices right there. Listeners are probably thinking, I’d like to buy homes at that price. If you could walk me through one of those deals, you were acquiring it for, let’s say, 10 grand and how much was going into it and then how much was the investor selling it for?
lamond (06:13)
So at that time I was acquiring the properties for roughly around $7,500 to $12,000. On those properties, that was roughly needed around $15,000 to $20,000 in work. At that time, most investors was selling, was using these as rentals. So these was like the three bedroom, one bath properties, you know, and at that time they was getting like around 8.50 a month rent. So.If you buy the property being all in at 35, 40,000, getting 850 a month rent in 2008, 2009, that’s good cap rate. You know, you know, so that’s really how they started off. then we met a hedge fund called American Housing Allowance. And when we met American Housing Allowance, they said, OK, look, let us buy all your turnkeys. And so the guy I was working with
Dylan Silver (06:49)
That is ROI.lamond (07:09)
He just sold them like 40 properties at one time and that just gave us a big boost to kind of keep everything going.Dylan Silver (07:17)
I want to ask you about scaling in the real estate space. So you started off and it really sounds like you dove headfirst into it. But then you also mentioned there’s some big deals that probably changed the game for you. 40 properties in one deal, I can imagine, might open some eyes. Was there any one strategy that you had to continue the deal flow and to make sure that you were always active on some kind of a transaction?lamond (07:47)
Actually, it was cold calling. So around that time, Fiverr really just started coming out. So I used to hire cold callers that specialize in insurance. So basically, I used to just keep a cold caller. But because the market was a downtime market, every bank had different ways that you can get to their properties quickly.because of that, we was able to cold call different banks, cold call different underwriters like, hey, you know what y’all finna foreclose on, things like that. Not only just the owners before they foreclose, but the actual lending institutions because what we learned that a lot of lending institutions were super small. They may only have 200, 300 properties on their books. So we was literally targeting those type of.
smaller lending institutions that had those small mortgages that they were finna foreclose on. So that what kept deals in our pipeline at all times.
Dylan Silver (08:52)
Wow.you know going in there’s going to be some equity in these deals. I want to pivot a bit here Lamond and ask you about coming out of that downturn. So now it’s getting a 2013 2014 2015. There’s more investor interest now you’re seeing some different types of investors as well. Some new blood you’re also seeing there’s more restrictions on who can get mortgages. So even the people buying conventionally may be a different audience.
lamond (09:01)
Exactly.Dylan Silver (09:23)
Did you pivot your business at all during this time frame or was it business as usual?lamond (09:28)
That’s the timeframe where I really start pivoting my business and start actually doing that time, my business really kind of start failing or falling, I should say, because there was no more 12, $15,000 houses. So my whole concept of how I do real estate start changing. At that time, that’s when I still was wholesaling. I was still wholesaling stuff like that.But at that time I started saying, okay, well, how do I get, how do I make sure I’m almost recession proof? So what I started doing was I started advertising more to general contracting services
during that time to the people who I was hosting the properties to. So basically it’d be like, okay, well, I can sell you this property for 20,000 if you allow me to do the rehab, you know, so it kept my guys still busy.
even though it wasn’t property that we was picking up like that, but it still kept my guys busy so they can keep working, just don’t leave the crew.
Dylan Silver (11:08)
I wanna get a little granular here about managing crews and rehabs. That’s a complicated business, right? You’re sourcing the deals and you’re managing the rehabs. At the peak, how many rehabs did you have going on simultaneously?lamond (11:24)
At the peak, probably had eight to 12 rehabs going on simultaneously between ⁓ three to four investors. And how I managed my crews, I do everything by system. So it’s almost like a assembly line, I’ll say. I don’t really manage crews, I more so manage trades. So what I would do is I would have my demo guys go in there.They may only be in there two days. My electrician, he only need the house for a day and a half. My plumber may only need the house for a day and a half. You know, my painters only need the house for two days. You know, so what I did was I set up the systems which allow my guys to go from house to house to house to house, you know, and don’t have to try to manage a hundred people in one
You know, that was just a big headache. But what I learned is
If I use like the different ring cameras and different technology, it will allow my guys, I know that my electrician at 123 Main Street, I know my plumber’s at 123 Ferret. You know what I’m saying? So it allowed me to know who’s where, doing what at the right time. So I just manage it like that.
Dylan Silver (12:41)
big systemsI can see, without those systems in place, it can be a lot to manage. I’ve been on these sites and it’s lot going on. And then you’re also having to deal with holding costs and you’re having to deal with expectations, especially since it’s an investor flip, it’s not your own, right? So it’s even a greater burden of responsibility in these cases.
lamond (12:48)
You couldn’t do it.It
was, it was, especially because a lot of them, that’s when the bird method was starting to come out real good. So a lot of them needed to refinance, you know, so they always had the appraisal coming through, all, you know. So what I started doing was I started letting them know, okay, appraisal value be around this amount. But even though I may say that it’d be done in say a month,
You know, I expect for it to be done in two weeks. So I just start really, ⁓ over delivering and under promising them. So I didn’t have to worry about them phone calls, you know, Hey, is it done yet? Hey, is it done yet? Because naturally when they think the project is a week out or two weeks out, they start calling more, you know? So what I did was I gave myself the extra wiggle room. So when they do start calling, yeah, we already done with that. We on this phase. Really?
Dylan Silver (14:01)
Yeah.lamond (14:06)
You know, so it really allowed them to ⁓ kind of keep the burden off of me as much, you know, because I always look like the hero if I do it like that.Dylan Silver (14:14)
Yeah.give yourself some margin, right? I wanna ask you about St. Louis and Cleveland. These are two markets that I’ve had quite a few guests on the show. Tell me how there’s really a lot of good deals that you can
lamond (14:19)
Exactly.Dylan Silver (14:31)
even sometimes, and I could be wrong in this, sometimes even on the MLS in these markets, where you might not necessarily find deals at that price or on the MLS in other.lamond (14:36)
Yes.Dylan Silver (14:43)
markets.are these two markets like and are there a lot more investors, maybe even from out of the state, looking at both of these markets?
lamond (14:54)
Well, yes, they definitely, they definitely is good mark, especially if you doing rentals,things like that, because I’m gonna say like Cleveland, we just picked up a two family flat in Cleveland, you know, a duplex, we picked it up, we all in a roughly around 110 and we written every unit out for 900 bucks. You’re not gonna find that in a lot of places. Now with St. Louis, the state of Missouri, where we just got rid of
was our capital gains tax on real estate. So that’s really finna help us. And we got the different federal tax credits, know, two or three exchanges, things like that, that really helping our investors now to really ⁓ profit in St. Louis. But you can, you can always find deals that have a 20 % cap rate, especially in rentals or more, you know, like that’s something that you can just find.
Dylan Silver (16:34)
I wanna ask you about some other asset classes and deal types that you may have worked with investors with or may have had some exposure to. Fix and flip, oftentimes we’re working with heavily distressed real estate or with folks who may be up against some type of ⁓ burden, whether it’s emotional, financial, death in the family, divorce, ⁓ some type of distress.But because of market conditions and then because of the cost of labor, because of the cost of materials, I have seen some investors, at least in the Texas market where I’m a licensed realtor, pivoting towards ground up construction. That does seem to be a trend, at least in Texas. That’s not to say that fix and flip is not alive and well it is, but there does seem to be ⁓ some type of a push more towards ground up construction for a lot of people.
Are you seeing any of that same dynamic in your markets?
lamond (17:30)
Yes,yes. market, especially St. Louis, it’s a lot of ground up construction, ⁓ especially since we have the tornado. So a lot of those older homes got damaged by the tornado, but we’ve been having a lot of ground up construction. That’s really my next pivot. ⁓ I never did a ground up construction yet, but hopefully within the next nine months, I will be breaking ground on my first.
You know, we already bought the land. We already working with the architect on the blueprints. Actually, that’s the project behind me. You know, so this is to be my first, it’s going to be my first ground up, you know, new build, which I call it. And it’s going to be a three bedroom, two bath slab property. And the reason why I’m pivoting towards new construction, sometimes it costs the same.
And I just seen someone build three houses from the ground up in the same amount of time it took me to rehab one.
Dylan Silver (18:34)
Yeah, that’ll do it. That’ll do it.lamond (18:36)
So it just opened myeyes up like what in the world?
Dylan Silver (18:39)
what’s going on. I’ve worked with flippers in Dallas, Fort Worth Metro, where you’ll see, you know, a brand new home selling for $50,000 more than a similar aesthetic rehabbed home. And so if you’re a buyer, you know, looking for your forever home potentially, and you’re thinking, well, it’s $50,000 more, I might as well get new. It does sort of change the dynamic there.We are coming up on time here though, Lamond. Where can folks go if either they’re in the St. Louis or the Cleveland area and they have a deal they’d maybe like you to take a look at or if they’d like to reach out to you and get your feedback.
lamond (19:18)
Well, anybody could find me on Facebook is Lamond Hammer Allen, you know, on Facebook. And you can also find me ⁓ on YouTube at All Things Real Estate Group. So if anybody want to find me, it’s Lamond Hammer Allen on Facebook and Instagram is Lamond Hammer Allen and on YouTube is All Things Real Estate Group.Dylan Silver (19:40)
Lamond, thank you so much for coming on the show here today.
