Why Boise Real Estate Investors Are Buying Rentals in One of America’s Fastest-Growing Markets

Chapin Hemphill (00:00)
It’s been, yeah, it’s been really, really interesting. There’s a lot of investment happening right now. So investors aren’t necessarily scared by what the national media says or even interest rates or the things that, that hold, hold mom and pop back or, your unsophisticated investor are not scaring the, the intentional and, and more experienced real estate investors. They see opportunity. So

What we’re seeing is a lot of new construction being purchased by investors here.

Cody Crabb (02:07)
Welcome back to the Real Estate Pros podcast. I’m Cody Crabb with Investor Fuel. Today I’m joined by Chapin Hemphill, owner of KeyRenter Boise Property Management in Boise, Idaho. He works with local and out of state real estate investors and has a front row seat to one of the country’s strongest in-migration markets, and he helps investors navigate Boise’s rental opportunities with a long-term lens. Now, you mentioned just casually before this interview that, well, you know, we’ll get into this in a minute, but.

that Boise and Idaho in general have the number one, how did you phrase it? The number one.

Chapin Hemphill (02:41)
The

last report I saw were number two, destination state in the nation.

Cody Crabb (02:45)
number two.

That is, I’ve never heard that and that is so wild to me that I feel like we totally have to talk about that. Thanks for joining us today, Chapin. I think this is gonna be great. Can you give us a little bit of history on kind of where you started, how you got into this, and what brought you to where you are today?

Chapin Hemphill (03:06)
Yeah, sure. So I grew up in Chicago. My father was a home builder. So I kind of have that real estate bug in my blood. It’s a virus, I guess, in my blood. ⁓ But nobody grows up saying, I’m going to be a property manager when I grew up. So the property management site definitely happened accidentally. ⁓

Cody Crabb (03:20)
You

Chapin Hemphill (03:33)
making a long story short, I was in a position where I needed a job. I became a leasing agent in an apartment building I was working at in Hollywood, California, eons ago. And that parlayed into me managing my own property in downtown Los Angeles, climbing the ladder of becoming a regional manager overseeing apartment complexes. And I started off in multifamily. ⁓

For about 17 years, I climbed the ladder becoming an asset manager and then overseeing billion dollar portfolios in California. Before I decided to leave corporate and start my own property management company, KeyRentor Boise is the third property management company that I have started. And so I’ve got a very rich and diverse experience in property management.

When I was in multifamily, had clients like Goldman Sachs. Today, it’s mom and pop and your intentional investors. So I’m really happy in the spot that I am now.

Cody Crabb (04:40)
So, that’s, I mean, this is the, you said this is the third property management company you started. What did you understand by the time you started this third one that you did not understand with the first ones? Because it sounded like you walked into this with so much expertise already because of what you did.

Chapin Hemphill (05:44)
I did. this is that, if you read the E-Myth Revisited, Michael Gerber, he talks about the technician starting a company versus the intentional entrepreneurial business builder. And so there is a huge difference between knowing your craft and building a business. So to answer that question, I knew nothing about building a business. I knew a lot about property management.

But then there was that business building side. for me, and I think this is particularly unique in real estate. I saw every apartment complex as a business, a single business, you know, with a market window. And as I was overseeing these multiple apartment complexes, I really treated it like I was the manager of multiple businesses.

And that really helped me transition into being a business owner. It just, I was a little bit more prepared there. And what I love about starting these businesses is that I’m three for three. successfully sold Key Renters Silicon Valley in California. We’re in the process of doing that in New England with another company.

And Boise is rocking. So these are really, really good businesses. I feel like property management is an excellent business that can roll through the tough times and excel in the good times. So I love them.

Cody Crabb (07:24)
Give me little insight into why you think it has that sort of power, like the staying power. Tell us a little bit more about that. Yeah, yeah, that’s the word I was looking for.

Chapin Hemphill (07:34)
Brazilians.

Yeah, it’s resilient because everyone needs a home. Not everyone can afford to buy one.

Cody Crabb (07:43)
Yeah, I mean that obvious it seems pretty obvious when you put it that way Yeah, everyone

has garbage everyone has stuff they need to get fixed. Everyone has rent they have to pay. mean it makes sense

Chapin Hemphill (07:51)
Yeah.

So, and the best example is during COVID, I became even a more important service. You know, we adapted to COVID. We showed without having to meet up with people. We were able to rent. We were an essential business because people need homes and they need, if there’s an issue with their home, a work order or a service request, that’s really, really important for quality of life and getting through the day. So,

Great example of its resilience, it became even more of a important service provider during COVID, during a time of uncertainty and extreme things happening. In a down market and in a recession, people tend to move together, they have to sell their home, they have to rent one maybe because their income isn’t as high or they’ve had an unfortunate experience.

that happens on broader scales. In good times, you have investors wanting to buy the properties and have them professionally managed. So it’s, again, very resilient.

Cody Crabb (08:59)
So, you know, when you look at, I liked what you said about having, keeping a rental as a, thinking of it as a business. ⁓ I think a lot of people see it as like, it’s just, ⁓ it’s passive income, you know, like it’s, that’s it, that’s all it is. But it is a, I mean, you’re literally buying a business. If you bought a bakery, you wouldn’t think of it as this like passive thing. You know what I mean? It’s not, it is far from passive. ⁓ I think people that own real estate need to remember that specifically. So,

What’s something, what does a good property manager or property management company do ⁓ to kind of keep up that, to keep things up? guess my real question is, let me rephrase this actually.

Okay, how does, okay, you know what? Okay, this is what I actually wanted to say. So since we’re talking to investors, from their perspective, from like an investor perspective, what is it that a property manager brings to a property that isn’t like some kid mowing the lawn? you know what I mean? What can the extra touches really give that property and that rental?

Chapin Hemphill (10:44)
that’s such a great question. You know, property managers have a very negative stigma, especially where I’m at. There’s really very little oversight and a lot of Yahoo’s running around. But I think what a good property manager can do is one, they’re protecting the asset and they’re protecting the income. Right? These are two really important things that we make sure we’re constantly watching to make sure they’re on track. We have metrics.

we know when the red flag, we can see the red flags from miles away. So that’s number one. Number two, we do the little things to when we’re protecting that. So for example, our speed to lease right now is about 10 days or less. Okay. In our market and our broader market, it’s about 32 to 35 days. So if you do the math, just by hiring us, you’re about $2,000 a head, call it $1,800.

because you’ve used us, we’re renting it faster, the rent is coming in sooner, your vacancy loss is effectively mitigated. So that’s an example. We start renewal process, 120 days out with an inspection, we have got eyes on the property. There’s just a lot of things we do every day that mitigate the risk and maximize the cash flow. And so there’s that.

then if you take it to another level, we have a bunch of intentional investors that we’re talking to every day. One guy might say, hey, I want a 1031 exchange out of this deal. Do you have any buyers? And we probably do just by reaching out within our network. That has been really effective. It’s been really exciting. Our investors love that. Nothing goes on the market, erasing hefty real estate fees, et cetera.

That’s fun. ⁓ What else can we do? We have such a network of different kinds of services, trades, vendors, providers that we are talking to every day that we can facilitate interesting situations, challenging situations we can help overcome pretty quickly.

Cody Crabb (12:40)
Yeah.

So you mentioned something a minute ago. You said you can spot red flags from miles away. Now, I would love to hear some of these red flags. Like what is it that you’re spotting that maybe someone else that hasn’t done this would not see?

Chapin Hemphill (13:17)
yeah, interactions with a resident and based on our experience, we can see that there might be, we need to give attention to a specific, thing that’s going on with them. guess a good example is we’ve recently had a resident who was constantly late. Okay. Constantly rent. We took over this property. This was one of the complaints from the owner. Constantly late.

We implemented late fees. We implemented things that would make it painful to pay late. But at the same time, we also introduced empathy and regular communication. Hey, how can we help you resolve this problem? Do you want, do you need some advice? Is there some plan we can help you come up with? Are you finding challenges in the timing of when you’re getting paid? And based on all that,

within about three months, they now are paying on time every month. And what does that mean? It just means that the owner knows that they’re gonna get their rent every month now. They don’t have to worry, they don’t have that anxiety about is he gonna be late again? it’s in the future when we’re looking at other residents, we can see patterns and say, hey, you’ve got a resident that we know exactly what to do. There’s a lot of red flags here, but we know.

what to do and you’re in good hands. So that’s an example. You know, right now it’s been raining a lot here. And so we’re getting a lot of roof issues, gutter issues, water mitigation, water remediation, problems, expensive things. ⁓ you know, hey, when we know rain is coming, we know what to expect.

Cody Crabb (14:47)
Mm-hmm.

Chapin Hemphill (15:05)
suggesting to some owners on certain properties, put in water detectors in certain areas. This will protect you from a $20,000 problem down the road. This thing costs $500 and it’s gonna save you 19,500. So those are the kinds of things that we can do.

Cody Crabb (15:11)
Mmm.

All of that is like so I feel like people kind of maybe underestimate the value of having somebody that really thinks ahead on those things just because you’ve seen what can happen. mean, especially in something like with something like water or plumbing, like things like that can escalate so fast and if you don’t spot it early. Yeah, and so.

Chapin Hemphill (16:27)
So expensive.

Cody Crabb (16:29)
You know, one question I have for you is, let’s say someone’s looking to hire a property manager, whether it’s you or somebody else. And let’s say, you know, they’re kind of trying to tick off the main, the check the boxes of the ideal qualities that a property management company would have. What would you say are the top few qualities that a property manager should have, or a property management company should have in order to be really successful and effective?

Chapin Hemphill (16:56)
They should be able to help determine whether a property is a good purchase before the purchase, not after and not when things have settled, but before. They should be able to provide valuable insight. And an example would be a lot of times when a property is being presented to the public for sale, they give the best case scenario. What is the…

Cody Crabb (17:22)
Mm-hmm.

Chapin Hemphill (17:22)
What is a true realistic scenario? And that really takes somebody that knows that micro market, what kind of renter is going to go in there, the type of renter important to know because the type of renter has a lot to do with the success of the property. So yeah, you might be looking at something that’s a little less expensive, but the type of renter that’s going to go in there could far outweigh any profit because, you know, it’s just not the right area.

Cody Crabb (17:49)
Mm-hmm.

Chapin Hemphill (17:50)
So all of those nuances in picking the property before it’s purchased are huge. So that’s one thing you can kind of ask some questions about. What’s your speed to lease? How fast can you guys lease properties and can you show that to me? What, maybe give some scenarios of a painful experience.

Cody Crabb (18:07)
Hmm.

Chapin Hemphill (18:12)
that a rental property owner is going through. Maybe you ask them a question or two and see how they handle that. then maybe ask some backup on if that’s truly, because property managers like to say that they do things. doesn’t mean they necessarily do them well or actually do them. So stress test those questions with some real scenarios and feedback and.

Cody Crabb (18:37)
Hmm.

Chapin Hemphill (18:39)
Go with your gut on whether those responses are true or being fabricated real time.

Cody Crabb (18:46)
And just to piggyback off of that, if you’ve hired a property manager, what would you say is like sign number one that the dam is breaking? Like, you know what I mean? Like what, what was, it’s communication?

Chapin Hemphill (18:54)
communication.

If so, you call them and they don’t pick up the phone, I guess that happens. We are really good about picking up the phone because it’s important. We know it’s important to a property owner that they get a pending question answered quickly. So we really have intention on picking up the phone. If they’re not picking up the phone, okay. If you call a second time and they’re not picking up the phone, uh-oh.

And if you call a third time and leave a message and they haven’t left, called you back, I would just say they’re not right for you.

Cody Crabb (19:34)
Yeah, because that’s probably the number one quality I would want in a property manager is you’re quick to answer a call. That makes a lot of sense for sure. ⁓

Chapin Hemphill (19:43)
I mean, I’ve told

my team the first 30 days of this pairing of a property manager to an investor is the best. It’s the honeymoon period. not, it is, is, it is never going to get better than that first, cause everyone’s romantically involved at this point. They’re, you and yeah. So if things aren’t going well in that first phase, man, that that’s a red flag.

Cody Crabb (20:03)
Yeah.

That’s good to know. Yeah, I think that makes a lot, lot of sense. Okay, so let’s pivot a little bit to Boise or Idaho specifically. I mean, you mentioned you’re seeing new construction all over the place. People are coming in from out of state that are interested. Tell us more about this, what you’ve seen personally.

Chapin Hemphill (20:29)
It’s been, yeah, it’s been really, really interesting. There’s a lot of investment happening right now. So investors aren’t necessarily scared by what the national media says or even interest rates or the things that, that hold, hold mom and pop back or, your unsophisticated investor are not scaring the, the intentional and, and more experienced real estate investors. They see opportunity. So

What we’re seeing is a lot of new construction being purchased by investors here.

And that I think has to do partially with what we talked about before. This is a destination state right now. The appreciation, projected appreciation here is very, very positive and healthy. And they’re making a buy and hold play times 10, 11 properties at a time. So.

The other interesting thing is we’re not seeing, hey, I’m looking for a property. We are talking to people that are like, I need to spend $10 million in the first or second quarter of the year. That is my plan. That is the money’s ready to go. We have a real estate investor or real estate agent actively looking at these properties and let’s go. So, and then of course we are like, yeah, yeah, yeah, but it’s real. It is happening.

You know, people like to talk, but I think what’s interesting in this time here is that it is being followed up with action. there’s, there’s, there’s, people are finding a lot of opportunity here and they’re taking action on it. Now, one really cool thing, I’ve got a great story here.

Cody Crabb (22:12)
share.

Chapin Hemphill (22:14)
So one really cool thing that we have been doing is we’re at about 450 doors today. So we have a lot of people we’re talking to about renting, about investing, and we are doing an incredible job of pairing the demands of both. So my story is we’ve had a few, this has happened several times now, where

A high net worth individual is looking to rent a property because they are looking to build in the area. They’re not necessarily sure where that is, but they know that they want to do that. It’s either a private home. it’s usually a private home. Okay. We have, real estate agents who have clients who are looking to purchase those higher end properties that this person wants to live in for now. So we have real estate agents saying, Hey,

I’ve got a client that needs to buy three homes. Their budget is this, and they want them to be higher end. That’s actually higher end is a common request right now from our investors. So we literally take the renter on a drive and show them some property. Would you like to live in this property? Would you like to live in this property? And then we go back to the…

real estate agent and say, this person is ready to move in to this property. His client buys that property. They close and our renter moves in within two, three days after close. And it is very exciting and a really cool thing to facilitate. Everyone’s thrilled, right? With that. yeah. And so that’s been really fun. And like I said, that’s, that is not a one-off that’s been happening.

Cody Crabb (23:53)
Hmm.

Yeah, how could you not be?

Chapin Hemphill (24:08)
over and over again.

Cody Crabb (24:10)
Operationally, of what do you have to do to kind of make that work? I mean, it seems like there’s some work behind the scenes there.

Chapin Hemphill (24:18)
So that is my business partner is the sales BBM. He’s the facilitator of that. And his secret sauce is he is a people person that loves to talk to people. So he’s out there garnering these relationships, facilitating these things, coming up with these ideas of how to make it work for everyone. So how are we doing that? You just.

We’ve got the right team, the right mindset about this. There’s opportunity. There’s everyone can win in these relationships. Everyone can win big. And so we, we just kind of run with that and, tell people that’s what we’re doing. I don’t know. And then they, you know, all those, stakeholders talk to each other. It’s a small, you know, boys is small. Everyone really knows each other here. So, the word gets out and.

Cody Crabb (25:08)
Yeah.

Chapin Hemphill (25:11)
then it multiplies.

Cody Crabb (25:13)
Well, Chapin, this has been really interesting. I feel like getting a little peek into what the Idaho market’s like, what property management’s like, kind of from your perspective has been really interesting. So let’s say someone is either investing in Boise or in Idaho right now, and they are hearing what you’re saying and they’re like, all right, we need to work together. I need to hire this guy. Or they want to learn more about you or about your company. Where can they go online to find you and learn more?

Chapin Hemphill (25:38)
Well, our website is keyrenterboise.com. But if you want to get in touch with me, go to LinkedIn. I’m a Chapin Hemphill. I think I’m the only Chapin Hemphill on the planet. So if you do a search, you’ll probably find me. But yeah, find me on LinkedIn. Send me a request and a message and we’ll get rocking.

Cody Crabb (25:59)
Awesome, yeah, think that’s a great idea. Like I said, property management is one of those things I think a lot of investors maybe overlook or they kind of cheap out on, but I think it can make a huge difference, like you said. So thank you so much for joining us today and giving us that insight. And thank you, listeners, for also joining us today. If you liked what you heard today, and I know you did, go ahead and go to like and subscribe on our channel and do all the things. Follow us so that you don’t miss more.

awesome conversations. Once again, it’s been a pleasure. Thanks so much for joining us today.

Chapin Hemphill (26:31)
Thank

you for having me.