How to Scale Fix-and-Flip the Right Way: Systems, Teams, and Zero-Item Inspections

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Show Summary

In this episode of the Real Estate Pros Podcast, host Michelle Kesil interviews Al Philip Neri, a seasoned real estate investor and flipper. Al shares his journey from starting in real estate with no formal education to becoming a successful investor in 21 markets. He discusses the importance of understanding risk tolerance, scaling a business, and the lessons learned from both successes and failures. Al also introduces his new education program, the W2 House Flipper, aimed at helping couples and individuals navigate the world of real estate investment. The conversation emphasizes the significance of mentorship, self-awareness, and building a supportive community in the real estate industry.

Resources and Links from this show:

• • • Investor Fuel Real Estate Mastermind
    • Investor Machine Real Estate Lead Generation
    • Mike on Facebook
    • Mike on Instagram
    • Mike on LinkedIn
    • Al Philip Neri’s Website
    • Al Philip Neri on Instagram
    • Al Philip Neri on Facebook
    • Al Philip Neri on Tiktok
    • Al Philip Neri on Youtube
    • Al Philip Neri’s Email Address: [email protected]

  Listen to the Audio Version of this Episode

  Investor Fuel Show Transcript:

  Al Philip-Neri (00:00)
  shit always goes wrong. mean, it always goes wrong, right? There’s always like unforeseen things that you gotta handle. And you gotta be able to problem solve really, really quickly. And you gotta have, you know, a team, your contractors have to problem solve really, really quickly. And they gotta work together in some cases, right? Cause you’re bringing multiple trades back in and you know, our goal on a flip is to basically to try to have no inspection items, right? That the buyer’s inspector comes through. And I mean, that dude’s gotta work so hard to find something wrong.

  Michelle Kesil (01:59)
  Hey everyone, welcome to the Real Estate Pros Podcast. I’m your host, Michelle Kesil Today I’m joined by someone that I’m looking forward to connecting with, Al Philip Neri, who has been making serious moves as an investor in 21 markets and a flipper. So, let’s dive in. Excited to have you here today.

  Al Philip-Neri (02:22)
  Thank you.

  Michelle Kesil (02:23)
  Yeah, of course. So first off, for those not familiar with you and your world yet, can you give the short version of what your main focus is?

  Al Philip-Neri (02:33)
  Yeah, I mean, right now I’m out of Denver, so fix my flipping in Denver is currently the main focus right now.

  Michelle Kesil (02:39)
  And how did you get started with all of

  Al Philip-Neri (02:41)
  Many moons ago, my parents had some rentals. They had a gentleman who would AKA do handyman work. And this was like 2004. I just left government service and he was like, we should buy houses. And I was like, do what with them? He goes, we’ll fix them up. He goes, you buy the house, I’ll fix them up and we’ll split the profit. So that’s how I got started in 2004 and then expanded.

  You know, there’s 21 different markets over that time and that was both flips, condo conversions, rentals, things of that nature. But it’s really as simple as that. was taking a chance with, I didn’t have formulas, I didn’t have anything. I didn’t have any formal education, I didn’t have anything. So it was just, understood if you buy a house for this price, you put this much into it, you sell it for this much, it cost you this much to sell it. If there was something in the middle.

  then you guys, me and him split it. And it was, I kept my math that simple. So obviously fast forward, there’s been a lot of education, know, coaching, mentoring. You know, I’ve been a coach mentor for years, spoke for all the big boy real estate TV shows. But when I first started, it was just simple like math on paper.

  Michelle Kesil (03:46)
  Awesome. And how did that journey unfold from starting off in that simple, no education, just getting thrown into it, into being successful? What are some of the stepping stones that you had to take and some things that you learned on that journey?

  Al Philip-Neri (03:52)
  Yes. ⁓

  Yeah, mean, surprisingly enough, first till we made money and I know a lot of people that that doesn’t happen. I tell people I’ve made money, I’ve lost money. You know, we got hit hard, you know, with the, you know, foreclosure crisis. You know, when you’re playing in multiple states and you have a lot of houses on the market and all of sudden you’re dropping prices to sell. I mean, you get get hit hard and anybody that’s played the game understands that. So

  You know, really what I learned was to scale appropriately, systematize, build your blueprint, right? I think for a long time I was chasing, I was just chasing what I thought I was supposed to be chasing. At end of the day, it can create a lot of sleepless nights. You have other people involved, it creates sleepless nights for them, you’re paying people back. I mean, it can be a nightmare, right? It be a nightmare. So what I’ve learned now, what I coach and teach now is just to be systematic in your own world.

  Understand your own risk tolerance, what are your own resources, what’s your availability of time, what’s your bandwidth, where’s your passion, where’s your area of expertise, where, you know, there’s a lot of different people when it comes to remodeling a house. How are you putting that team together, right? How does that, what does that look like? And so tons of lessons that have come out of the journey, tons and tons of lessons that have come out of the journey.

  Michelle Kesil (06:03)
  Absolutely. I know every business has those moments where there’s like hardships and obstacles. Would you mind sharing one of those lessons that you’ve experienced and what you learned from overcoming it?

  Al Philip-Neri (06:10)
  you

  Yeah, for sure. Had a property out of state. It was going to be a… It was an old maternity hospital from like the late 1800s. We bought it at a really good price. But ironically, nobody ever told me there wasn’t a back wall. And shame on me, right? Because I didn’t go see it, but you know, I was getting pictures. And this is, you know, go back a number of years, probably like 15 years, right?

  And I was getting photos. I was getting photos from my agent and things of nature. I don’t know, I didn’t think to, when I was looking through stuff, like, you know, be like, how come there’s no picture of the back? Like, you know, facing the building kind of thing. There was, you know, facing the land and we were going to turn it into three condos. you know, so submit or do all that stuff. And, you know, what I learned there was that people only want you to see what they want you to see.

  And it wouldn’t, in all fairness, really affected my decision to buy the building. ⁓ You know, and under the scope of work, it just said like masonry or something like that. Like a very generic term. ⁓ anyway, fast forward, that building ended up being a nightmare for me. A gentleman, I’d done about 40 something flips with him, and he was the, ⁓ the contractor, he ended up involving somebody else who ended up

  basically not paying any subs and so you know here I was getting sued by the subs going to Debit Decisions I’m suing him because I’m like no we got proof of wire and money he wasn’t paying the subs it was a so I mean it was basically stop work for like two years by the time we handled all the litigious stuff I ended up winning the lawsuit but I mean anybody that’s been in this cave knows that doesn’t mean a goddamn thing and especially after losing two years on a project

  in a market that at that point was crashing and crashing and crashing. again, at that point, I was like, one is going to look at a building or protect our money like I am. so you just unfortunately, now we have FaceTime and things of nature. Much different when you’re on FaceTime Live. Much different when you’re on FaceTime Live.

  because I can be like, no, slow down, hold on, hold on, go back, take a left, take a left, take a left, you know, kind of stuff like that if I was gonna do stuff outside. Hence, you know, that’s why for the last, I don’t know how many years now, it’s just basically been Metro Denver, and that’s it, because I’m here, and I can go by multiple times. It doesn’t mean I’m micromanage, but I can go by multiple times, and I have good crews, guys I trust, but I still go by on a regular basis.

  Michelle Kesil (08:49)
  Yeah, absolutely. I think that’s important to have your eyes or a good team on the project with you.

  What have been some of the keys that you would say have allowed your business to scale and to be able to grow smoothly?

  Al Philip-Neri (09:42)
  I think just proof of concept, right? know, mean like in Denver, you can come and see us flip stuff, right? I mean, we’re doing it. We can walk through a house, start to finish, And so, hence you have the, aka the social proof or in-person proof kind of thing. And also I think I’m just very transparent, right? So you, you know, like.

  shit always goes wrong. mean, it always goes wrong, right? There’s always like unforeseen things that you gotta handle. And you gotta be able to problem solve really, really quickly. And you gotta have, you know, a team, your contractors have to problem solve really, really quickly. And they gotta work together in some cases, right? Cause you’re bringing multiple trades back in and you know, our goal on a flip is to basically to try to have no inspection items, right? That the buyer’s inspector comes through. And I mean, that dude’s gotta work so hard to find something wrong.

  He’s gonna find something, trust me.

  Just trust me, it’s just the way it goes. But he’s going to work really, really hard to find something wrong and really to find something legitimately wrong. So our goal is to do good quality work. It doesn’t matter what the price point is, but just turn over a really, really good house for the future buyers so that it’s problem free for them for a number of years. And again, it doesn’t matter what the price point is. So we don’t drop the quality of work based on the price point of the neighborhood.

  Michelle Kesil (11:00)
  Yeah, absolutely, that makes a lot of sense. What are you most focused on solving or scaling to next?

  Al Philip-Neri (11:03)
  you

  The biggest thing is I’m launching my own education product called the W2 House Flipper. Hence W2. We’re going to be coaching, know, AKA couples or combined incomes where, you know, income is solid, credit’s good, money in the bank, 401Ks, but you’ve always had a passion to invest in real estate. And, you know, the benefit of flipping is it gives you what’s called, I call lump-sum cash, which then moves you into a different, you can now start putting that into…

  key rentals, maybe in a different market, things of that nature, but you can start building something systematically. Maybe the end goal is you’re trying to replace one partner’s income or something in a year or two years, but you’re not dying to have to have a remodel right now. You’ll wait for the right deal, but you’ve got somebody in your corner that can handle you. You have full access to my full team.

  from contractors to insurance to hard money, whatever the case may be. These are guys who are better tried, trusted, proven. And so that’s the education product we’re launching. And then ⁓ on the backside of that is a product I call Flip to Cash Flow, where you flip for lump sum cash, take a percentage of those profits, put them into turnkey cash flowing assets, which may not be in your local market. now, hence the word is turnkey cash flowing assets.

  So you’re not trying to deal with remodeling another market. so, again, it goes back to just you having a blueprint that you go off of my concept, my framework, but you build the bird clamp based on your resources, your time, your availability to put into X, Y, Z. Because that’s very, very important. Because you’re flipping. You’ve got to be available, right? mean, depending on how you do stuff, if you do home-debilt, home sales, et cetera, et cetera, you have to be available.

  if you’re not available, then who’s going to be available? How are you going to set this up with your contractors and stuff like that? yeah, so I’m excited about that next journey. was approached, I did not go seeking, I was approached as someone came to me and said, hey man, this is what we’re looking for in our group. Definitely check all the boxes, is this something you’re interested in doing? And obviously I have a passion for teaching, or I wouldn’t have spoke for all the big boy TV shows for as long as I did.

  Michelle Kesil (13:18)
  Amazing. Are these services just catered towards people in the Denver community or is it like nationwide? Who are you serving through this?

  Al Philip-Neri (13:22)
  Thank

  Yeah,

  it’ll be both. It’ll be both. We’ll definitely target the, know, AKA the, you know, Denver, Colorado Springs, Pueblo, you know, Fort Collins. We’ll definitely target that because a lot of this is, you know, we’ll do in-person meetups and stuff like that. For the most part, all the education is going to be online, but obviously the difference is, you know, if somebody is in Phoenix or Vegas or Washington DC or whatever the case is, you know, the houses I’m flipping are here, right? So…

  I might do an impromptu meetup because this Saturday I’m going to walk through a property we just put on a contract or something. So now if you’re out of state, ⁓ you can be involved, but you can be involved via FaceTime or something like that, WhatsApp, whatever. But we definitely want to, I mean there’s no reason the education model can’t be expanded ⁓ nationwide. Because again, it’s a framework. It’s a framework for people so that they can scale at their pace.

  And there will be regional events like we’ve talked about, know, an event in Florida, an event in Arizona. Talked about a crew, a couple cruises, one probably going out to West Coast, one maybe going out to you know, Galveston area. And so there will be events for people nationwide to come and plug into where, you know, I’ll be teaching and going through stuff. So definitely. Little bit different for nationwide versus, you know, aka the Denverites, but definitely we want it to be available.

  Michelle Kesil (14:52)
  Awesome, that’s exciting. What are your goals with these platforms? Where do you kind of see them heading?

  Al Philip-Neri (15:40)
  You know, at end of the day, real estate can be a blessing. It really can be a blessing. And what I mean by that is you’ve got to look at that word and give it a definition. I mean, it can be a blessing to you and your family because of the financial success you can have from it. And now question is, what are you going do with that money? Right? So sure, there’s whatever things you want to do for your family. That’s great. But you can also do things for other people’s families.

  for other charities, things that you support. The other thing you have to think through, like your crews that work for you, ⁓ and instead of like, you need stuff for the right price or you’ll be a terrible flipper, because it’s not retail, ⁓ but you also gotta understand they have families too, and they have kids too. just by you being successful in real estate, you’re awarding them opportunity to make money, to be in a good workplace environment, doing what they love to do, so they can take care of their family.

  And then I think the end all bigger picture is obviously when you experience success, I would hope that within the culture and the community we’re building that you are going to go and give back. And give back to communities, people, organizations, whatever that you feel compelled and passionate with to be able to give back because you are able to write a check or buy a

  toys at Christmas or buy a table at this gala or whatever that may look like for you. So, at end of the day, ⁓ I don’t care for all the showboaters on Instagram, TikTok, all that stuff like that. Like, good for you, man. That’s your model, you’re making a ton of money. Good for you, good for you. Like, I’m happy for you, right? That’s just not me, That’s not me. ⁓ So, I want more of a humble, kind of like a humble community.

  Right, so if that’s your goal is you want to be famous on Instagram and TikTok, go learn from those guys and then showboat all your bullshit. Don’t come to my community because we won’t align as humans. I mean, obviously I’ll lose students because of what I just said, but it’s okay because I want my own tribe and my own community.

  Michelle Kesil (17:54)
  Yeah, of course, it’s important to speak to your specific people and yeah, make sure that you are aligned with your audience.

  What are some of the educational things that you’re going to teach people? Like what’s ⁓ the first set of advice you would give someone that’s maybe just starting out and they’re not sure if they’re ready to invest in a program? Like where can they start?

  Al Philip-Neri (18:20)
  Yeah, mean, you know, number one.

  Number one, people always talk about why, right? And why do you want to be financially free? Okay, that’s cool, right? That’s fine. Again, I’m form-sized college just by trade, right? But I think when it comes to real estate, right, they’re here for a reason, right? And maybe they’ve tried Amazon, maybe they’ve tried stocks, maybe they’ve done this, or they got this allure, like they want to do this, and once they do this, they’re going to build this. That’s cool, that’s the shining objects in the road that all entrepreneurs have. Like we’re all lying if we don’t say we don’t have it, because we have it, right? That’s the entrepreneurial.

  And so we’re like, oh man, yeah, we’re going to do this and this this this this. And so you’ve to find your way. So a lot of it, know, really first level education is really just saying, here’s the pillars of real estate, right? Here’s the pillars. And the pillars, you know, work on do you need to make a lot of some cash for X, Y, Z reasons? Well, if you do, well, here’s the methods of real estate investing that offer that to you. Are you looking for…

  cash flow assets. Well, here’s the methods of real estate that offer you cash flow assets. And what I mean by that is, right, I mean now with like Airbnbs and obviously you got rentals and you got BRRR and you got this, you got right at the end of the day, the yield is the same. And then obviously you got long-term investing, right, which is now you’re basically, you’re not worried about the lump sum, you’re not even worried about the few hundred dollars a month. You basically want the long-term asset for legacy building. Okay, cool. Well, let’s figure that out first, right, because once we figure that out.

  then we can put you in the right bucket. Then once you’re in the right bucket, now it’s okay, this bucket requires X, this bucket requires X. Do you have the resources? Do you have the time? Do you have the risk tolerance? Do you have, right? Because now it’s one of those things where you could want to be a good fixin’ flipper, but let’s say your personality is to micromanage everything.

  and you ain’t got no money. Well, I got a news flash for you. No one’s gonna work for you and you don’t have any money to flip, right? So no, we gotta find something different for you within the real estate vertical kind of thing. So I think a lot of it is just again, self-awareness. So it’s my job to put the cards on the table. It’s their job to be self-aware enough to say, okay,

  This is the bucket we wanna play in and here’s the reason why. Then from there, it’s okay, who can best service, coaches, teachers, mentor us, know, kind of stuff like that. I’m not gonna teach Burr or Airbnb Arbitrage or any of stuff. Somebody else will go do that. So if that’s their bucket, then it’s okay, within my network, do I know someone who’s successful? Maybe I can refer you, right? If I don’t, good luck, right? Go weed it out on the Instagram and the TikToks of the world, right? ⁓

  But again, go to meetup groups, go to investor groups, there’s people doing stuff, right? And then when you feel like you’re lying, then start probing a little bit deeper. ⁓ yeah, it can be very, very overwhelming for sure. And the process of doing a deal can be very overwhelming if you’ve never done this. So hence, that’s where the guidance, the mentorship, the handholding ⁓ is crucial. It’s crucial, man, because things come up every day by the hour.

  Stuff comes up.

  Michelle Kesil (21:37)
  Absolutely, that makes a lot of sense. It’s so good to have support from someone that’s been through it and can give you an answer on the spot instead of, you know, trying and failing and, you know, taking much longer than having that roadmap.

  Al Philip-Neri (21:54)
  Mm-hmm. Yeah, for sure.

  Michelle Kesil (21:55)
  Awesome. So before we wrap up here, if someone wants to reach out to you, connect or learn more, where can people find you?

  Al Philip-Neri (22:02)
  I mean, you know, social media, I mean, I’ve got a unique class name, you’ll find me, right? Facebook, Instagram, TikTok, you’ll find me. And understand, you may see real estate stuff, you’ll probably see a lot of performance psychology stuff, right? You know, one of my specialties is building teams that operate under pressure, which is a direct, I mean, you need to be able to have that within building your real estate team and things like that. But, you know, I do a lot of work around team cohesion and having your team operate under pressure.

  So you see a lot of stuff like that. ⁓ Email is, if not as best, it’s basically [email protected] So A-L-P-H-I-L-I-P. And as in Nancy, E-R-I at gmail.com. if you liked what I had to say, you’re interested in the W2 House Flipper Program, would love to set up a time, show you what we’re and try to help you check your boxes. It’s not about my boxes, it’s about helping you check your boxes, right?

  Michelle Kesil (22:55)
  Perfect. Well, I appreciate your time, your story, and your perspective. Thank you for being here.

  Al Philip-Neri (23:00)
  You’re welcome. appreciate you guys having me as a guest.

  Michelle Kesil (23:02)
  And for those listeners tuning in, you got value, make sure you’ve subscribed. We have more conversations with operators like Al who are building real businesses. We’ll see you on our next episode.