954: Cash Flow Is King: How to Profit Through ANY Financial Downturn – Craig Curelop

Aaron Amuchastegui 

Real Estate Rockstars, this is Aaron Amuchastegui. Today, I get to interview Craig Curelop. So, Craig has been on all sorts of podcasts out there, written books, and right now he lives in Denver, Colorado. His real estate team is out there, and his agents are also investors. So, I think a lot of focus today will be on investing through real estate, but we’re gonna get to talk about a lot of stuff, including his book and what he’s been working on, and everything else in Denver. Craig, thanks for joining me on the show.

Craig Curelop 

Aaron, thanks so much for having me on. Man. I’ve been looking forward to this for some time now.

Aaron Amuchastegui 

That’s awesome. So, you live in Denver, and you lived there for four or five years?

Craig Curelop 

Yep. Just about four years.

Aaron Amuchastegui 

Okay. And what’s it like out there right now? With COVID and real estate, what’s it been like to live in Denver over the last year?

Craig Curelop 

Yeah. So, you know, Denver is obviously an amazing place, super outdoorsy, and all that kind of stuff. So, you know, all the people out here are, you know, pretty fit, pretty healthy, which is a lifestyle I really like to abide by. You know, in terms of the real estate market, I think it’s pretty similar to anywhere else in the country where it is just absolutely exploding. You know, last January, February, like just before COVID, it was insane what things were going for: $40,000 – $70,000 above list price pretty consistently. Then COVID hit and everything shut down in the big scare, right when the whole country shut down. And even real estate business shut down. But I was still kind of doing some, you know, talk with the agents and just saying, “Hey, like, is there any way you can just come check it out?” Like kind of under the table, whatever it is, you know, and they were like, “Yeah, we just want to sell this house.” And so, you know, once COVID hit, we were doing deals like super easy right below asking no competition. It was a really good time to buy for my clients. And then April, May of 2020, you know, COVID kind of became the new norm. And things kind of started open up for a while – things got back to normal. But now, more recently, I’d say it’s kind of in the middle. You know, it’s not totally open like Florida, but it’s not, you know, totally shut down like California. We’re kind of like somewhere in between where restaurants are operating at 25% capacity. There’s absolutely showings allowed, but they try not to overlap the showings. There’s no open houses that are happening. But you know, we’re still trying to do business.

Aaron Amuchastegui 

Yeah. You’re the first person that’s actually candidly admitted or talked about the idea that in April and May, you could get houses for a deal. Right? Because COVID happened, and prices just went up even more and the real estate markets have been booming. But I mean, my listeners have heard me say that I took a risk. I had an extra house in March, and I listed at 10% below what it should have listed out because I was so terrified. And I was like, I just need to sell this house. I don’t want an extra house going into the biggest crisis of our lives. Well, I was wrong. But, man, the people that were willing to go show the houses back in April, May, they couldn’t get good deals, because we were afraid. I even bought a brand-new house and moved into it. And I remember being like, “Man, I wish I had my down payment back.” I am a little worried that I bought this big house right before, you know, we’re about to have this economic crisis. I know a lot of places said that real estate was essential early on, or agents were allowed to go and do like virtual showings. Had that been a thing for you? Were you doing virtual showings?

Craig Curelop 

It was largely virtual showings. In some cases, the clients came with me, particularly if the house was vacant, and there wasn’t really an issue. And if the listing agent didn’t really care, and so that’s kind of like, you know, I always made sure that all parties were okay with it. And but at the end of the day, the listing agent wants to sell the house, my client wants to buy the house, and I was telling my clients, “This is an opportunity we’re never going to see again. There’s a two-month window here.” At the time. We didn’t know how long the window would be. But we figured it was a pretty short window of like super scariness to a new normal and we needed to like hit this window in order to get deals while I think showing appointments were down at 8%. I was like “Damn, am I the only one showing houses right now?” It was like it was like shooting fish in a barrel there in those couple months. And, you know, we got some pretty good deals.

Aaron Amuchastegui 

That’s really good insight and good for you that you guys pushed so hard at the beginning because it was it was such a nerve wracking time it was like, there’s always big opportunity when you eliminate competition, right and you take risks. That’s why I love investing in courthouse step foreclosures, because there’s not a lot of competition at it most of the time. And when there’s a lot of competition, that’s when I need to go find a different area or a different something, because I like not having competition. And there’s the old saying that, you know, if you don’t do what everybody else does, right? So, if everybody’s afraid, you should take, you know, take some risks, and everybody’s taking risks, and you should be afraid. And I thought you went through that mantra, and then the fact you got some good deals out of it. That’s pretty awesome. How long have you been a real estate agent?

Craig Curelop 

So, I’ve had my license since November 2017. So, like three years. However, for those first two years, I was only an agent for myself. Okay, so I’ve also started really, in August of 2019, was the first time I accepted a client that was not myself, and slowly realized that there was a niche here of people wanting to get into house hacks, and people wanting to get into investment properties. And there was really no agent, or at least very few agents out there that could guide someone from, you know, from looking at houses, to run in the numbers to giving them contractors to basically just be in their coach the entire way from initial conversation all the way till close and even past close. And when it comes to managing the property and getting tenants and all that kind of stuff. And you know, especially first-time investors really value that. And so that was kind of how I differentiate myself from the other agents in the market, and had a pretty successful last year and a half.

Aaron Amuchastegui 

Yeah. So, you got your license in 2017. But that was just so you could buy investment properties. Did you already own investment properties at the time and you bought some prior and decided you were going for when did you buy your first house?

Craig Curelop 

Yeah, so I bought my first house in June 2017. So that was my first like house hack that I did. I was not an agent. I was represented by another agent. And in November 2017, like I just said, I got my license. So that way, my second and third one I did myself. And then I realized, like, man, if I can like get an extra 10 grand here and there for each sale, that’s not a bad gig. Yeah, to help somebody out who wanted a house hack. I helped another buddy who wanted to house hack. And I was like, “Man, this is like, kind of nice. Like, there’s worse things in the world than getting 10 grand.” So, I was pretty happy.

Aaron Amuchastegui 

You’re trying to be an agent yourself. You’re like, hey, getting this extra commission is gonna help pay for the new appliances for the house or any of your other investments or down payments or all sorts of stuff.

Craig Curelop 

Yeah, I mean, most recently, me and my lender actually teamed up for a deal, and he got a pretty good rate because he was the lender. And I basically had the seller pay down our closing costs, as well as paying down our rate, instead of paying the commission. So, we got our most recent investment property at like 2.25% for like a 30-year fixed investment property. And it’s so hard to lose with those rates.

Aaron Amuchastegui 

That’s really interesting. So, you’re like, instead of paying me a commission, so you’re like writing the offer and say, “Hey, no buyer’s agent commission, so you’re going to save 3% there. But instead, you’re going to spend 3%, to buy down the rate.” So, you get to buy the property, you don’t get taxed on your income at that point. And then now you have yet a 2% rate forever. So, tell me about the first house that you bought before you were an agent. What was that experience like? Why did you decide to buy one? And you know, just tell us about that process.

Craig Curelop 

I was basically just gung ho on financial independence, and I see real estate as the fastest way to get there, right? Rental income exceeds your expenses, you’re financially free, and you can start taking bigger risks. And so house hacking was the obvious first choice as someone with not a whole lot of money, I maybe had $40,000 or $50,000 at the time. And a duplex is just so much easier, because when you go home to your investment, it’s like if something breaks, you’re just going home to fix it, right? It’s on the weekend, you go upstairs or whatever it is, it’s super easy. And you’re always seeing what’s going on at the house. And so that first property I bought was a duplex, top bottom, both one bed one bath totally renovated. It was basically a flip. And the reason why I bought a flip was which is kind of against the grain, right? Like you hear a lot of people say, “Oh, you want to buy these fixer uppers and all that kind of stuff.” But like for a house hack, I totally disagree. Because you want to get in, get it rented and start saving for your next house hack as quick as you can. So that was my thought there. So I went in, I rented out the top unit lived in the bottom, but that top unit wasn’t quite covering my mortgage. And so what I did was I rented my bedroom out on Airbnb and I lived behind a curtain in this like room divider in the living room on a futon for a year. And that really propelled me because that was an extra $1,100 a month, I was living for free plus making about $600 a month on cash flow. And that really set the foundation for me to buy my second, third, fourth, fifth, you know, now I’ve got like 14 units, and so on.

Aaron Amuchastegui 

Wow, like a traditional house hack is somebody maybe not traditional, but an example of a house hack could be somebody buys a four bedroom house, they move into one of the bedrooms, and then they rent out the other rooms by the room. So whereas the house would maybe normally rent for 1500 a month for the house house act numbers, if you’re renting out the rooms individually, you can charge a little bit more, so maybe the house rents for $2000 instead. Is there a rule of thumb that when you’re doing that analysis that says “Oh, I can normally rent this for $1500, so I can now rent it for $2000? Do you do deep analysis on every property? Like how much more do you get to rent it for when you get the house hacker house.

Craig Curelop 

So in Denver, right, if you’re gonna buy like a five, I think the five bed three bathroom houses are really the best for house hack in the sense that you’re describing with the rent by the room style. And so a five bedroom, three bedroom, five bedroom, three bathroom house will rent for about $2700. Generally, if you were to rent it out by the room, you’re getting $3800 pretty easily. So typically, it’s about $1,000 more per month by the room than it would be as a traditional single family unit. And so I think it’s super beneficial in your first few properties to buy it and do it rent by the room, right? Because you want to get as much cash flow as you can at first, it is more work, it is harder, it’s harder to find a property manager to do it. Like those are all the downsides to it. But once you can, like get your nest egg to a certain amount, you can always switch it back to a single family home. Sure you take less cash flow. But it’s you know, at that point, you’re looking to scale. Right?

Aaron Amuchastegui 

Yeah, so you bought that first duplex, and that version of it was like you’re gonna rent out one side and live in the other. Did you know right away, you were gonna end up sharing your half of the duplex or did you first look at that and say I could rent out one side and live in the other and be okay?

Craig Curelop 

Now I knew I was gonna be living in a living room, it was kind of one of those things that I wanted to do. Just because, you know, I had that Dave Ramsey quote in my head where you know, “Live like no one else now so you can live like daydreams later.” So I was like, how can I put myself in like, the worst possible position to make the most possible money and it just see, you know, see where it takes me, right.

Aaron Amuchastegui 

So you slept in the living room behind the curtain and rented out your room on Airbnb, with people that stayed there, were they like, “Dude, this is crazy. You’re living behind the curtain?” Or were they like, “Cool. Thanks for giving us the room.” What was that part like?

Craig Curelop 

Yeah, so it’s funny, like no one really even questioned it. I think people just thought I was broke and just needed to make some money from my house, right. But I would have really genuine conversations with a lot of the roommates or the guests coming in and out, you know, every three to five days. Two or three of them. I’m honestly still in touch with today, right, like four years later. And so I made some good friends throughout this whole process. And really, I’m a huge traveler too. So it satisfied my travel bug, right, like meeting people from Australia, New Zealand, Poland, you know, all over the US. It’s just like, it was cool. It was actually like really fun for a year. It was really fun.

Aaron Amuchastegui 

So what’s the average Airbnb person that’s coming to rent your room and share the house? What are they there in Denver for just for travel themselves?

Craig Curelop 

Yeah, I’d say, I’d say 80% of the time, it was a couple, just traveling looking to see Denver, they were in town for a Broncos game or a Rockies game. Maybe they were just driving through town. Sometimes they were just going up, you know, to spend a few days in Denver. They wanted to head up to the mountains for a few days. If you’re going to come to Denver for the mountains, you might as well see Denver while you’re here. And so that’s kind of why I think people stay for two three nights. And yeah, I mean, it, it worked out pretty well.

Aaron Amuchastegui 

Yeah, I mean, there’s, there’s so many mountains there. There’s so many ski places, within a couple hours of Denver, you fly into Denver for all of them. I mean, the first time I went up to Breck and Aspen and some of those places flying to Denver, then you’ve got a two hour drive or something to get up there. So I could see people stay longer. And I flew into Denver once a couple years ago, but every hotel in the city was booked. I had to go there for a business thing. And I got there and there wasn’t a single hotel that had any availability. And I was like, that’s crazy because I got on the plane thinking I’ll just book one when I get there. And it was like 100% occupancy in the city and there must have been a game or something going on. But I could see that if there’s a you know, if there’s high demand for hotels there that people are actually saying like maybe that helps out with your Airbnb, but you don’t Airbnb a room anymore and live in the living room anymore, I’m assuming.

Craig Curelop 

No, yeah, no, I’m past that. That was only, that was only year one. And then I kind of I kind of, you know, in the book, I talked about the, the comfort continuum, which you know, on one side is comfortability. The other side is profitability. And you know, at first I like to stretch on that side of profitability as much as you can. And then as you get your second and third one, you’ve got more passive income, you start to become wealthier, you slowly move towards comfortability, sacrificing some profit. But, you know, no one wants to live behind a curtain for the rest of our lives.

Aaron Amuchastegui 

I love that. So you bought one, and then you said, “Okay, now I’m gonna save money by living in the living room.” So then you’re like, “Maybe I can also save money by becoming an agent.” And so first you were just an agent yourself to, to buy your properties. And then somewhere, but it was like 2019, I think you said, “Okay, I’m actually going to be an agent now, for other people, too.” So you had done deals, but you didn’t have to do any of the, like, you knew the agent skills of like, essentially your transaction coordinating your own deal. But you’re also underwriting the investment deal. But you hadn’t really been an agent yet. So I would say like 2019 is when you actually got to be an agent. And once you had a client, what was your first deal like? Was it just buddies wanting house hacks too? And you found them, or what was the what was the niche?

Craig Curelop 

So the first one was just my buddy who wants to house hack, and he knew that I had house hacked three times and was like, “Well, if there’s anyone who’s gonna find me a house hack in Denver it’s going to be you.” I was like “Okay, well, that’s easy enough.” We went and found him a five bedroom, two bathroom house. It was a flip totally redone. He lived in the downstairs, the bigger room downstairs. And you know, he actually added a bedroom. So it was a four to be turned into a five. And now he rents out all five of those bedrooms. He’s making probably little over three grand a month and his mortgage is a little over two grand.

Aaron Amuchastegui 

So how many so the how many deals did you do in 2019?

Craig Curelop 

I probably did eight or nine deals.

Aaron Amuchastegui 

Okay. And what’s the average sales price in Denver? Or where are you with the deals you do?

Craig Curelop 

So, in Denver average sale was around $400,000 right? 2020 I had like a crazy year. Like it went up a lot more than that. But yeah, so that was my 2019. It ends up being about $10-$12 grand a transaction on a commission basis.

Aaron Amuchastegui 

Okay, so in 2020 hits in the end your first couple months years I guess what also made it easier for you to take advantage of the situation is you were on all those representing investors. Was it all house hacks? Was anybody like trying to buy to go move in, or was it just as an investment basis?

Craig Curelop 

I think every single one of my clients except one was a house hacker or investor, the other one that was not wanting to invest wanted to turn it into a rental in a few years. So I guess like, there was a half a person that wasn’t like us.

Aaron Amuchastegui 

So whereas a lot of families were probably not wanting to buy in April, and may, your investors were like, “Hey, go get me a deal. I still want to buy another house and rent it out as long as it cash flows.” So that’s where you are in this unique situation where there wasn’t emotion tied to a deal or moving and you know, getting a deal now they were kind of you had some well-trained investors to do that. So then by May, June, it started to be the real estate market started to go up. Did you start to have more people that were actually trying to live in the house? Or was it all investor or mostly investor type people?

Craig Curelop 

So it’s that combination, right? It’s they want to live in the house, and it’s an investor. So I’d say most of the clients are house hackers. So probably say 70 or so percent are house hackers, the rest are just traditional buy and hold investors. And so for the house hackers, yeah, I mean, they were trying to live in the house, and they were trying to, you know, cash flow when they moved out. Now, I would say that there is a decent bit of emotion in there, more so than traditional investors, because these guys, you know, they’re putting 20 or 30 grand down, and that is their first investment. Most guys I’m working with, and girls I’m working with are young, right? They’re in their 20s. 30 grand is most of their life savings. And so, you know, we’re kind of working with them to make an investment that is the largest investment of their lives. And there is a little bit of emotion there not emotion of like, oh, the cabinets aren’t the right color. But just like, what happens if I don’t get the place filled, right? Oh, my God, the inspection comes back and holy crap, right? And so, coaching them through the inspection and coaching them through any, like low appraisals and making them helping them see the forest to the trees. is really what I think I got good at in 2020.

Aaron Amuchastegui 

Yeah, I guess that’s a great point. When I think of investors or when I go buy a house as an investor, it’s like, does it pencil? Right? And so it’s easy for me to say it’s not emotional; it’s a business decision. But even in April, May, I was emotional because I was a stressed out investor going “I don’t want to invest in anything right now. The sky is falling.” But, you’re right. So I guess the other side is that they are also going to live there. And for them, it’s a temporary place to live. So maybe they don’t have the same emotion as living there forever. But they do if it is their life savings –  they do have to decide like, is this laid out in a way that we could have roommates without feeling weird, and things like that? So. So what are some of the ways that you cater to investors? Or if somebody if somebody is an agent out there right now, and they want to start adding, you know, representing investors to their tool belt? What would you recommend?

Craig Curelop 

Well, the first thing you have to do is invest yourself, right? Because as an investor, you don’t want to work with someone that’s not an investor. Like if you’re going to talk, you have to walk the walk, and that is the number one thing. Number two thing is you also have to start learning the language of an investor. If you need to start talking like an investor, you have to start thinking like an investor. So if you if you walk into a house, if I walk into a house, like I couldn’t tell you about the oak cabinets in the year, right, like, I’ll tell you, “Hey, what years the furnace? What years the AC? When are you gonna need to replace the roof? Like, like, what are some like minor upgrades you could do to increase rents?” Like that’s the stuff you want your realtor to tell you. And you also want them to maybe help you. You want to tell your client, “Hey, this is how much is this gonna cost you. And then how much increase in rent you’re gonna get because of this thing. And is it worth it? Or is it not worth it?” And I would say most cases, people, at least in Denver, like people want to rent in Denver. And so if you go crazy with upgrades, you’re really not gonna get a huge return. People just want to live in Denver, they don’t care about the place, especially as a rental. And so you also want to make sure that you’re catering to your target market, right? You don’t want to have the nicest house in the neighborhood, with quartz countertops and all that I’ve made that mistake to try to make it the nicest house in the neighborhood, and then you still can’t get the rent because it’s not the great neighborhood.

Aaron Amuchastegui 

Yeah, I love that first piece of advice you gave that if someone wants to represent investors, because investors are great clients for real estate agents. They’re usually repeat clients. Whereas somebody might move from their house every three to four years an investor might have you help them buy a house every year or every two years like that’s gonna be their goals. They get to repeat more often. So getting to go invest yourself, you know, as an agent if you’re wanting to represent investors to go try it. So if you want to go try house hacks or you want to try any sort of investing, being able to buy it yourself so you can walk the walk and talk the talk. I think that’s really important. And I think, I think 2020 is the time to diversify. You know, I wish that all agents were investors, because in most of 2020, the businesses that I have that I used to make money for every month, buying and selling foreclosures, that has gone to nowhere because of foreclosure moratoriums, but the stuff that has made us money this year has was our investments from before. And so being diversified out there, you know, agents, be like Craig. Have those extra commissions, that extra money, go towards something. Maybe the first transaction covers your bills, and the second transaction goes toward your future investments. And then I really liked the thing you said, like one of the differences between rentals and, you know, and flips or other investments is, if you put, you know, $10,000 worth of upgrades in a house, you know, really high end appliances, granite countertops, great flooring, the great thing is that you are usually going to sell it for more than $10,000 more than you were right, you’re going to add $10,000 upgrades, you’re gonna sell it for $20,000 more, well, rent is a lot different because there’s these, these parts of rent that just don’t get any higher, right? There’s certain neighborhoods, I bought this apartment complex in a in like a small town in Texas. And my plan was, hey, the rents are really low. They were like, you know, $600 a unit, maybe they were less, and I was like, I’m going to rehab them all and put in, you know, new cabinets, new granite, new appliances, new flooring, and I’m going to be able to rent it for so much more. And I didn’t get to. I only got to rent it for like $25 more. Because what I learned hard about that neighborhood is it was a neighborhood where people just weren’t gonna pay more than 675 no matter what I got you, they couldn’t afford it. Anyone that could afford more was going to go live in a different neighborhood. So you do have to look at ROI a lot differently with rentals. What are some of the things that when you did to do improvements to houses that really helps your rental ROI for regular investments or house hacks?

Craig Curelop 

I would say paint goes a very long way. Yeah, painting the trim and the walls. Floors go a decent way. You know if the carpet is ratty and all that kind of stuff. It’s kitchens and bathrooms that people fall in love with. But you don’t need quartz countertops. I think granite countertops are perfectly fine, especially for a rental – they’re a little bit more durable, and also a little bit cheaper. One thing my girlfriend did, which actually worked out really well for her was there’s this like vinyl rollout, basically like tape stuff, right? And you can turn like a Formica looking countertop into a butcher block looking countertop. Right? So it does it and the tenants that are not real estate professionals, right? They’re literally looking for a place to live. And one of them actually is looking to invest in real estate. He’s like, “Oh, whoa, you got nice butcher block countertops.” You shouldn’t even notice, unless you really look. And so stuff like that for rentals actually may go a long way. And you know, it costs such a little bit amount of money.

Aaron Amuchastegui 

So what about your guy that did your recent deal, or maybe for your friend that added a bedroom? What does it cost to add a bedroom in a house? And how much extra did that add to his projected rent?

Craig Curelop 

Adding a bedroom, especially for rent by the room is is probably one of the most valuable things you can do. And it also adds value to a house. And so right, the place was four bedroom, two bath, it was 2000 square feet. Any house with 2000 square feet in Denver, you likely can add a fifth bedroom. And so what that consisted of was basically just like cutting off a piece of the basement, putting up a wall and adding a door and running some electrical through that wall that totaled him about $1600. And I’ve heard people do it for as little as $800. And as much as $2000. And so let’s say it’s the absolute max, right, let’s say you don’t get a good deal, and you get it, you do it for $2,000 to add that wall. He’s making an extra $650 a month because he added that bedroom. He’s paid back for that $2,000 in under three months, right? So that is one of the best strategies is to add a bedroom.

Aaron Amuchastegui 

So it seems like that like adding a bedroom makes sense even if it was gonna cost you $10,000 to add a bedroom because it was more complicated or something like that. If you’re adding $600 a month you look at that investment. Like if I could buy a house for 10,000 and if it rented for $100 a month I’d be happy. Right? So when you get to you know, essentially adding a room is like buying a house for 10,000 bucks but it rents for 650 bucks. The that seems like a great strategy – finding houses in Denver that only have three rooms that are big and splitting that living room up and other things. What’s one of the biggest problems you’ve had with a house as a landlord? Have you had many problems with like people sharing rooms? Do people fight? Do people disagree? They tell you, “Hey, kick this guy out. We don’t like him anymore”? What’s the what’s the worst part about house hacking?

Craig Curelop 

That is probably the worst part. I would say if you do a good job of screening your tenants and creating a culture within your house, then then you’re not going to run into those issues as frequently. Before I learned all this stuff, I did not do that. And I just kind of accepted the first people. The first few months were okay. But then, you know, there was some animosity at some points. And you know, there was some yelling and some fighting and all that. And I’ve had to kind of play mom and dad for a while, but they eventually moved out. And it was fine. They always paid rent and all that kind of stuff. So it was good. And yeah, I mean, it’s a downside that you have to hit for the highlight, right? It’s a risk and it’s a downside. Now, one thing that a lot of my clients have done recently is you basically niche your house out. So you know, snowboarding and rock climbing are really big things to do here in Denver area. And so it’s, you know, rock climbers paradise or snowboard heaven kind of place to live. And once they did that, they started attracting snowboarders and started attracting climbers – people that they actually liked and wanted to hang out with. And now they’re all friends, right? They’re going snowboarding together, going climbing together, they’re doing all these things together. So if you are going to do a wrap around the room strategy, I think that would be the biggest piece of advice would be to like, target who you want to live there.

Aaron Amuchastegui 

Yeah, I could see that like marketing to the people that are going to share your lifestyle, especially if you’re living in one of the rooms and renting out the rest of them. Is it harder to evict somebody if they’re just renting a room? Are there different laws for people that are just renting a room? Is it easier, harder, different?

Craig Curelop 

I would say it is going to be harder to evict someone for renting by the room, because the sheriff isn’t going to come up and put a you know, a notice of eviction on someone’s bedroom door. Right. It’s the address in the house. And so really, there’s a couple ways that you can kind of mitigate this risk, right? One way is, and a lot of people do this, if you just sign everybody to month to month leases, if someone is horrible, you just say, “Hey, you’ve got 30 days. We’re gonna terminate this lease.” A lot of people do that. One time I did have to kick someone out. And I did cash for keys. And if you want to get into it, we can. It’s kind of a funny story.

Aaron Amuchastegui 

So we’ll talk about that. So yeah. So you had a tenant. That wasn’t good. And so what did you tell him?

Craig Curelop 

Yeah, so I had two tenants, and I got greedy here during a rehab, and they wanted to live in the bedrooms outside of where the construction was happening. And I got greedy. And I said yes. And I charged him a pretty cheap amount. And they were, you know, doing hard, illegal drugs downstairs in the basement. I found out I called the cops. The cops couldn’t do anything. For some reason, I guess it’s legal to do these hard illegal drugs in your bedroom. And so I basically said, “Hey, you guys need to get out in the next week, I will give you all of your rent you’ve ever paid me, your entire security deposit, and $500 to get out in the next week.” And they got out in the next week. And it was fine. All good and dandy, but I got lucky, right? If they if they caused a fuss, it could have been a lot harder. And so, you know, many lessons learned there. One, don’t be greedy, and two, always screen your tenants. That was the one time I didn’t screen my tenants. And, you know, if you’re especially going to do this rent by the room strategy, eviction is a lot harder. That’s a good question.

Aaron Amuchastegui 

It’s really interesting stuff. Right? Because when you look at us investors right now, we buy a lot of houses and we rent out the house, right? And it’s tougher to find deals right now, tougher and tougher to find cash flow. So we’ve thought about, “Hey, is it worth trying to, you know, be an investor and buy a house and rent all four rooms out right to individual people?” It’s like, the return goes up the, the risk probably goes up a little, depending on where it is, or the strategy, but as agents, getting to learn and know about all these strategies just helps you be a better agent helps you present, you know, present opportunities for your people. So Craig, how many deals did you do in 2020?

Craig Curelop 

Like 95

Aaron Amuchastegui 

That’s crazy. So, in 2019, you did like nine you said?

Craig Curelop 

Yeah.

Aaron Amuchastegui 

You did nine deals before. So, but you had had a couple in escrow at the end of 2019. So you started off your 2020 with a few closings right away. But the how many closings did you do before COVID went weird.

Craig Curelop 

I did about six before March.

Aaron Amuchastegui 

So you’ve done six averaged a little bit better than the year prior. But so you were on pace to do 24 for the year, and then March it and nobody was selling. And so you went to your investors and said, “Hey, now’s a great time to be able to buy more. Because no one else no one else is doing that. We get good deals.” How many did you get during that period?

Craig Curelop 

Yeah, so you know, March was when COVID really got big right. And so closings would have happened in April, May and June. So April wasn’t great. Right. April, I guess. Yeah. I only did two in April. May. I did like eight. And then June. I did 11. So that is where a lot of the momentum came from for sure. And then we really just, you know, continued that. And I was nervous. Because like, I don’t know, in those unprecedented times, you can’t really look back at like, April, May and June and think that July, August and September are going to be any different are going to be better. Right? Yeah. And so but I mean, they were better. So we just started really kind of crushing it.

Aaron Amuchastegui 

Man, none of us could have predicted any of this stuff. I mean, somebody probably did. There’s probably smart people out there who predicted a lot of it. But most of the decisions I made in the last nine months were the most I got I got half of my guesses, right and half of my guess is wrong along the way, for what what would be a good deal and what wouldn’t? So if you were gonna go back and give yourself advice. Now, I mean, you’ve been an active agent for a couple years. Right? And so I guess one of the big things I would say is, Hey, don’t discount being a specialized niche agent investor, because Craig did 90 something deals this year. And the and he just got his license a couple years ago. And you’re a young guy, and you started with people that were first time homebuyers. And your niche ended up really helping you break through up there. I mean, your numbers were huge. There’s a lot of people that had great 2020s. But the but not very many people that have been agents for two years that had great 2020. Right. Like that was that was one of the unique things that people are doing great before crushed it last year, the people that were just getting started had a really rough year. So there’s something to be said about just investing and niching. But what advice would you give a new agent right now? Or do you wish someone would have told you when you got started? Like what have you learned something in real estate that you’re like, Oh, I wish I would have done this instead?

Craig Curelop 

I guess one thing I wish I would have done instead is you know, we’re creating a team now. So I would wish I’d probably started the team thing earlier cuz I did run myself ragged last year. However, as a new agent, especially if you want to niche out in like an investor type approach, you want to make sure that you’re documenting your stuff, and you want to put it on social media and you want to, you know, if you’ve got a newsletter, send it out to your clients, let them know what deals you’re doing what they’re doing in Denver. I mean, I’ve got a lot of clients that were just like, how much can you cashflow in Denver? Like, how are you getting $1,000 a month in cash flow, like on all of these deals? Like is it too good to be true? And we’re like, no, I can point to like, 35 deals where we’re cash flowing, $1,000 or more, right? It’s very easy, very consistent, you have to be a little bit creative. And you know, you tell him, I just tell him, “Hey, this is what you have to do to cash flow that much. And these are areas you have to be in.” People get pretty excited about it. And then they start telling their friends and really just kind of spiraled from there.

Aaron Amuchastegui 

So sharing your wins and sharing how good of a deal it was really helped people start asking you and you mentioned the newsletter, plus social media. But yeah, I think that would do that, too. I think being able to say, “Hey, that’s a $400,000 investment that cash flows this much.” After all, you know, mortgage and people go people want to invest in real estate right now. Like it’s no secret, like people want to do it. But everybody says I can’t get a good deal. It doesn’t cash flow. So you can say like, hey, we’ve got great cash flow. That’s like the LA You see, like the car, the auto dealerships in the newspaper would say this car 10 grand, and then you’d get they’re like, well, we had one of those for 10 grand, but now we have this one for 25 that’s left, but you’re able to go like, “Hey, this house makes you that much money. That’s how we do it.” That sounds like a great way. So, you share your wins, and you get to, you know, keep building that? What do you think is gonna be the number one way for agents to succeed in 2021?

Craig Curelop 

I think it’s really going to be, man, that’s a tough question. You know, if guess if your continued if you’re successful now, if you consider yourself successful now, I would say continue doing what you’re doing, and maybe just double down on it. Right? Also, a lot of it is going to be people are going to speculate and think there’s going to be the stock market crash and this you know, real estate crash that’s going to happen, and you really just have to tell them, especially if you’re an investor minded agent, that like it does not matter what the market does, we’re gonna make sure that your property cash flows when the markets up, when the markets down, and when the market stays the same. So, no matter what happens, you never are in a position where you’re forced to sell. And you explain to them that the people in 2008 lost so much money, because they were, it wasn’t the people that were buying cash flow, right. Those are those guys are very rich right now. The guys that lost their money are the guys that were getting loans 125% LTV, right, the guys that are flipping and trying to make a quick buck that didn’t know what they were doing, and really just the inexperienced folks who lost the money. money in real estate back in 2008. And so you kind of put that all into perspective. And also the whole thing where, you know, people that people think real estate’s gonna go down, because it went down, you know, 10 years ago, the last recession. I mean, before that real estate hadn’t really gone down significantly since like the 1930s. Right, despite the fact the stock market had multiple recessions since then, and you look at this whole COVID thing and how it’s impacting right, it’s impacting mostly, you know, bartenders, waiters, right, kind of people that don’t make a lot of money on paper, who can’t afford to buy houses, anyway. Right. It’s mostly the renters that are being affected. And so, to think that real estate is going to have anywhere near of impacts that didn’t just in 2008, I think it’s foolish, and maybe it drops a little bit, or maybe it slows a little bit. But again, cash flow is king.

Aaron Amuchastegui 

Yeah, great advice – buying for cash flow. When we first started investing in like 2014, 2015, we remembered the crash, we remembered it deeply. We were building houses, we remember the foreclosures, we remember the all the different crazy workouts. And so every time we refinance, we would always be like, we’re worried about a crash, like, I’m always worried about that crash. And so anytime we would finance we’re like, well, is this note long enough that will cash flow through whatever, up and down? Like, so the buying cash flow, you know, being able to do that, that that works in your houses can go up? 1020 30%? Down 1020 30% rent doesn’t go up and down at the same percentage. And if it does, so, if your house that you’re renting for 1400, you have to rent for 1200. Now, you that’s not going to break the bank, right? It shouldn’t, it shouldn’t or you’re not, if you’re going to spend it you lose 2400 a year on your rental investment. Like that’s a crisis in in rentals. I guess the crisis in rentals is people not paying and not being able to be evicted, and hopefully the more government intervention to help with that right now, but short of this weird, weird time of people being able to not pay rent and not have anything, you know, a $200 a month correction would be like, Oh, that’s a big rental correction. And something that but when you have a 20% correction on value, and people are 90%, you know, levered on a flip. That’s when you see big differences. So well, Craig, we’re starting to run out of time. Tell us about you. You’re a guest writer for The BiggerPockets blog. I did a quick Google search as I was prepping for this of just my email inbox, right? It was like, Oh, where’s that interview notes from for Craig, and all of your BiggerPockets posts up on the newsletter they sent out so you do a lot of you know, blog posts or stories for them. You’ve got your book that got published. What’s next for you? If people want to reach out to you find you talk to you?

Craig Curelop 

Yeah, you can find me on Instagram is probably the best way. I’m at the FI Guy on Instagram. Or you can, you know, if you want to work with us out in Denver, the Fi Guy Team. And yeah, that’s probably the best two places where you know, the social media, that I actually check regularly.

Aaron Amuchastegui 

Yeah, very cool. So The FI Guy on social media, if people want to invest in Denver, they want to learn more about it, they can go or then you go find your book, learn more about house hacking as they go out there. I really like to get to hear your perspective on kind of on the market. And really that analysis that you did at the end that just said like this, we’re living through a weird time of economic ups and downs. But the but it’s just a little bit different. It has been this year, it’s been two different recoveries. There have been some people that have suffered a ton, you know, the service industry, people, I think most of those service industry, people should become real estate agents, because they’ve got real skills, real people skills right now, and maybe they do better in real estate, but the service industry has really struggled. And then but like the finance sector has hardly any unemployment. One of the interesting articles we talked about a couple months ago, was the fact that these interest rates keep getting lower and lower. But it’s really only helping the people that were doing good already, like the people with, you know, no unemployment, the people that need it, the bartenders, the workers, it is harder for them to buy jobs, because most of their income has always been kind of under the table. Right? And so they’re not getting to take advantage of those low rates right now. So a lot of interesting perspectives out there. Craig, I’m gonna go follow you on Instagram too. We’re going to be able to chat, the Real Estate Rockstars hopefully, you guys had a great as good of a time as I did. I think I learned a lot and look forward to reaching out some more. So guys, thank you for listening. Craig, thanks for being on the show.

Craig Curelop 

Thanks. Thanks for having me.