183. First Deals, Lifetime Lessons with Makay Dobbins

Summary

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Real Estate Investing School Podcast

Episode 183: First Deals, Lifetime Lessons with McKay Dobbins

Date: August 12, 2024
Host: Joe Jensen
Guest: McKay Dobbins

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Overview of the Episode

In this episode, host Joe Jensen sits down with McKay Dobbins, a financial advisor and new real estate investor based in southern Utah. Over the last two years, McKay and his wife Sammy transitioned from traditional careers to actively building a real estate portfolio. The conversation centers on McKay’s first three deals, the challenges and lessons learned, and practical advice for others considering a similar path. The episode offers a candid look at the steep learning curve, personal growth, and the reality behind “getting started” in real estate investing.

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Key Discussion Points and Insights

1. How McKay Got into Real Estate (01:22–05:16)

• At 29, McKay was influenced by seeing others like Brody start their real estate journeys on social media.
• With a background in financial advising, McKay felt compelled to escape the 9-to-5 grind for something more flexible and lucrative.
• Initial interest was sparked by lifestyle design, wanting long-term freedom rather than working until 65.

“We’ve both realized over the past couple years, like, dude, we just don’t want to be doing what we’re doing for 40 years.” — McKay (01:48)

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2. First Deal: Buying a Primary Residence (05:16–08:49, 15:32–18:05, 48:10–49:14)

• McKay bought his first home as a lifestyle move, not initially for investment.
• Admitted to prioritizing a “nice new home” without consideration for rental potential—a common mistake.
• Put 5% down (could have put 3%), highlighting a knowledge gap common among first-timers.
• Added a bedroom later to improve rental value and opened a HELOC for future opportunities.

“If I could go back…I would have found something that we liked to live in but would have been more or easier to turn into a long-term rental.” — McKay (06:01)

• Takeaway: Even imperfect first steps teach essential lessons and can later be pivoted into assets.

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3. Mindset Shift & Sales Experience (08:49–14:42)

• McKay’s first year in financial services was challenging due to lack of discipline and hustle.
• Realized success required treating his job like a business—consistent effort, follow-up, and pushing comfort zones.
• Key mantra: “Create opportunities and capitalize on opportunities.”
• Sales and entrepreneurship demand more effort upfront—a theme that parallels real estate investing's steep early learning curve.

“At that point…I want to do more and I want to make more. And in order to do that, I got to have a mindset change and an attitude change and an effort change.” — McKay (09:19)

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4. Second Deal: College Room Rental House (18:05–41:35)

• Looked for a local investment property and found a 1970s home near Utah Tech with six bedrooms (20:06–24:15).
• The house needed substantial rehab; “gross…smells weird…haunted.” Initially hesitant, but realtor Eric’s encouragement was pivotal.
• Lost initial offer; became the third backup and ultimately secured the property (24:15–26:14).
• Roof needed replacement ($15–20K); negotiated with the seller to pay from proceeds at closing via escrow (27:15–28:38).
• Strategy: Added two bedrooms (total of 8), self-renovated with "sweat equity."
• Rented by the room, primarily to male students for practicality (35:14–36:16).
• Overcame property management challenges—multiple leases and maintaining an older property.

“We painted so much of that freaking house, dude…there’s like a three-day window…we’re painting in like 100 degrees inside the house.” — McKay (32:48)

• Key learning: Many obstacles seemed overwhelming at first but became manageable with experience.

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5. Compounding Experience & Learning Curve Analogy (39:23–41:35)

• Real estate (like sales and golf) has a steep learning curve; things become easier with repetition and persistence.
• Each “okay” deal leads to better deals and broader networks—a compounding effect.
• Taking action is more valuable than waiting for the “perfect” opportunity.

“Someone gave me an analogy between real estate investing and golfing…learning curve is super, super steep at first, and then at some point it starts to level out, and you’re like, hey, I got this.” — McKay (41:10, repeated from cold open)

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6. Third Deal: Primary Residence as a Strategy (42:06–49:14)

• Sought a new primary residence to maximize leverage (5% down) and find something with long-term rental potential.
• After a long search, found a discounted property with large acreage outside St. George. The seller was motivated, having slashed the price six times in a month.
• Repeated roof-repair negotiation strategy; handled via proceeds at closing.
• Agreed to a two-month lease back to the seller to aid her transition.
• Simultaneously rented out their first home to a group of summer sales reps, leveraging the added bedroom to maximize profit.

“We now have to get our current primary home rented out…We just got them under—we just signed leases with them a couple days ago, and they’re going to be August 1st…” — McKay (48:10)

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Notable Quotes & Memorable Moments

• On Taking the Leap:

  “Just buying something and getting in is better than not.” — Joe Jensen (15:32)

• On Creative Financing:

  “Deals aren’t found. They’re made…you make it into a deal by getting creative and finding a way to make the seller happy, make the buyer happy.” — Joe Jensen (28:55)

• On Fear in Investing:

  “There was so much fear the first two deals, because I just assumed that they either weren’t going to work out or I didn’t know what I was doing. And then in hindsight…they’ve definitely worked out. So that fear was pretty irrational.” — McKay (49:39)

• On the Compound Effect:

  “It all just compounds and snowballs on itself because you’re in the game as opposed to sitting aside waiting for that perfect deal to come along.” — Joe Jensen (40:43)

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Timestamps for Key Segments

• Getting into Real Estate — 01:22–05:16
• First Deal Breakdown — 05:16–08:49, 15:32–18:05
• Mindset Shift in Sales/Business — 08:49–14:42
• Second Deal Discovery & Rollercoaster — 18:05–26:14
• Negotiating Roof Repairs — 24:48–28:38
• DIY/Sweat Equity Renovation — 32:48–36:16
• Rent by the Room Strategy — 34:30–36:16
• Learning Curve & Golf Analogy — 41:10–41:35
• Third Property & Using Leasebacks — 42:06–48:04
• Renting Out First Property — 48:10–49:14

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Final Four: Reflections & Recommendations (50:25–53:58)

1. What McKay Would Do Differently

• Would focus first purchase more on long-term rental potential, not just lifestyle.

“I would have bought something that was just a little bit more conducive to being a long-term part of our portfolio.” — McKay (50:42)

2. Recommended Books

• Rich Dad, Poor Dad (mindset)
• How to Win Friends and Influence People (people skills)

3. Expensive or Interesting Mistakes

• Buying at the top of his approval instead of for investment logic; putting more down payment than necessary due to lack of knowledge.

4. One Word to Describe “Why Real Estate?”

• Freedom

“If you do things the right way and your priorities are aligned correctly, investing in real estate can give you freedom…” — McKay (53:33)

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Tone & Takeaways

The episode remains conversational, candid, and encouraging—focused on real-world lessons, rookie mistakes, and honest self-reflection. McKay’s story illustrates that taking imperfect action is crucial, relationships and resourcefulness are more important than expertise, and financial “freedom” is the ultimate motivator.

“Start building that momentum.” — Joe Jensen (54:24)

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Connect with McKay Dobbins:
Instagram: @mckaydobbins

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For anyone wanting an honest view of what starting out in real estate really looks like—with both the wins and rough patches—this episode will resonate and inspire.

Transcript

[A]

Someone gave me an analogy between real estate investing and golfing, and I just feel like in both cases, the learning curve is super, super steep at first, and then at some point it starts to level out, and you're like, hey, I got this. And you progressively get better and better, and it gets easier and easier.

[B]

Welcome to the Real Estate Investing School podcast. I'm your host, Joe Jensen. Today's guest is McKay Dobbins. Now, McKay and his wife Sammy are pretty new to real estate, but they recognize the in it and they are all in. They currently live in southern Utah. McKay works as a financial advisor. Sammy works in marketing. Sports and people are McKay's passion. Sammy's an animal enthusiast and loves helping people heal and grow, and so does McKay. You actually just started. Well, welcome to the podcast. But we were just chatting. You just started your own podcast as well. What's the name of that?

[A]

Did. Well, first off, appreciate you having me on, Joe. It's an honor. Yeah. So I just started a platform called Dudes and Athletes, or DNA. So, in a nutshell, I'm just here to try to help inspire men to be better versions of themselves through stories, sports, and healing. So just started that this week. Thanks for the little shout out.

[B]

I love that. Dudes and Athletes DNA.

[A]

That's sick, man.

[B]

I love it. Well, sweet, dude. Well, I'm excited to dive into your story and everything kind of real estate related and whatnot. So you live here in Southern Utah. You've just been into real estate. I mean, really, just the past two years is really kind of when your mind's turned onto it. So tell us how old you are and then what kind of put real estate on the radar for you?

[A]

Yeah, dude. So I'm 29. I'm a northern Utah boy. I've been down here in St. George for about eight years and. Good question, dude. I don't even know. I feel like a few years ago I saw Brody start the real estate investing school. Right. So I'm a financial Advisor. That's my 9 to 5. And so I've been in a somewhat similar space. It's just different investing. Right. Yeah. And me, myself, and then with my wife Sammy, we. We've both realized over the past couple years, like, dude, we just don't want to be doing what we're doing for 40 years. Right. Like, you don't want to fit into a stereotypical. I'm just going to work a 9 to 5 until I'm 65 and then retire and then enjoy life. Yeah, that sounds terrible. So I Think that when. When Brody first started posting stuff and I saw his Instagram content, I was like, okay, this is obviously cool. I don't know much about it, but I'm intrigued by it. And then that was our first little taste, and then we've kind of gone from there.

[B]

That's dope, man. So you've.

[A]

You.

[B]

You kind of got the bug a little bit. Started as kind of a lifestyle play. Like, okay, I could see big picture and of what this could design our life to be like. And then you started getting your feet wet. You. You've done a couple deals. You've done, what, like, three deals? Let's go back to deal one, and maybe you can kind of break down what that looked like and what it took to get from seeing the post. A lot of people are like that. You know, they see a post, they hear a podcast, you know, they read a book, and like, this is cool. But then it's usually many years, I've found. I feel like the average I've talked to is either like eight months to three years before people actually end up doing. Doing anything, like, physically, like actually buying any property. Yeah. Why don't you take us through that process of how it was for you?

[A]

Yeah. So going back probably three years ago, I was about two years into my career. So I finished school, got my degree. I had been about two years into my financial advising role. And for me, it's. It's. I'm essentially a salesman, Right? So I'm essentially selling financial products. Yeah. So for my first year of my career, I sucked at it, dude. Like, I was not making any money. I was. I was just. Just renting a place. I was. I was dating Sammy at the time. And then year two of my career, I. I was like, hey, I gotta. I gotta figure something out. Like, I gotta figure out what I'm doing so I can make some more money. So I was lucky and blessed to be able to take that leap in year two and make a lot more than I was previously used to. And at that stage of my life, Sammy and I had just gotten engaged and I had a bunch of friends that were buying their first house. And so I was like, I mean, I guess I could do that too. So at that stage, we just started looking for a. A primary residence to buy, to move into.

[B]

Not even so much as an investment or a big, like, it was just like, well, that's the response. That's what I do now, I guess. I'm making money, I'm getting married. Like, I might as well, buy a house, like more of just a life move, right?

[A]

Yep, yep. And I think in the back of my head and through like some of Brody's stuff, I was like I should probably buy something that maybe down the road I could like rent out. So I looked at a few different places, like some townhomes here in town and a few other spots and I've realized a few of my faults. Number one, I like nice things and I like nice stuff and so I looked at a few places that probably would have been. So this is one of the mistakes I made, if you will. I think if I could go back I would found something that we like to live in, but the would have been more or easier to turn into a long term rental, if that makes sense. 100%.

[B]

Yeah. A lot of times people go in, they want the nicest thing, the fanciest thing and, and people are willing to pay a premium for that. And so it's hard to rent it out to cover its costs because the mortgage is such so high because people are willing to pay a premium to live in what they want. And so like say when it comes to it be turning it into investment, it's like, oh, I can't even rent it out for enough to cover half of its costs, you know. And so it's hard to hold those as investments. But you go into it with that in mind, it might make it easier. But a lot of times you're taking a haircut on the lifestyle, it's not usually as nice. At least here in Utah. That's kind of how the demographic works.

[A]

So definitely. So it was funny. So if I could go back, Obviously hindsight is 20 20, I would have done something more along those lines. But in my perspective, from my perspective back then, it was okay, I'm making way more than I've ever made. I'm going to buy something up to the max that I can afford. My naive little short sighted brain. So we ended up buying a new build down here in southern Utah and I was kind of scared. I was like, dude, this is so much money. Holy crap. Luckily at that time rates were half what they are now. And so it wasn't too bad from a long term perspective. But yeah, so we, we bought a new build if you will. And from my perspective, six months in I was like crap dude, like I shot myself in the foot. I'm not going to be able to like you turn this into what I want it to be long term. And for that first year I was like, dude, I just, we Love the house itself and we love living in it. But it, it wasn't in my mind at least something that we could turn into a long term. So that was, that was the first move. And this is another side note as far as like a mistake I might have made is all my buddies for whatever reason were putting 5% down on their first homes. And so I was like all to put 5% down when I could have just qualified. I just done 3%. So like I put more into it than I probably needed to in that case. And I just did it because I thought that's what you're supposed to do.

[B]

Sure.

[A]

I didn't have like the education or the knowledge about other lending products or other avenues. And so I just. We just put 5% down that we had saved up over the past year from working. So that was the first move. So we bought our first home. It was just a new build single family home here in St. George.

[B]

That's awesome, dude. I want to back up a little bit. This isn't necessarily real estate related, but you said like your first year in sales doing the financial service stuff, it was a struggle. You're figuring it out. And then something changed in that second year one it sounded like a mind shift and you're like, I gotta like figure this out. And then you started making more money than you'd ever made. I was just curious of like what kind of shifted there. What, what's the story behind that that made such a difference for you?

[A]

Yeah, great question. So for me it was, I had a few moments where I was like, dude, like I'm just keeping my head above water. Like I'm making enough to survive, but I'm like, I'm like frustrated. Like I don't, I'm not, I'm not doing what I know I can do. And I did some introspection to realize, hey, like I'm, I'm not putting the time or the effort into getting better at what I do so that I can be more successful in it. So it was things like, so my time is my own in my role. I have my own schedule, I set my own appointments. And I was every day like looking forward to like leaving the office. I was like making one referral call to referral I got and then just dropping it. I was more so looking forward to ending the day than like trying to grind it out, if that makes sense. So the grind and the hustle wasn't there at all. I was excited to leave the office in this case and I just realized, hey, Like, I want to do more and I want to make more. And in order to do that, I got to have a mindset change and an attitude change and an effort change. So at that point in time, I was like, okay, like, I'm going to set some priorities. That. And that for me, that meant in my role, like, if I get a referral, I'm going to make sure I reach out to them three times so I can connect. If I set an appointment with someone, I'm going to make sure I'm prioritizing being there. And then my mantra for that for the past few years has been creating opportunities and then capitalizing on opportunities. So for me, that means if I'm meeting with a client, for example, or a potential client, that was the creation of the opportunity and then my priorities then to capitalize on it. Whereas before, it was honestly was just lazy, dude. Like, I had that attitude of that drive, and I was okay if someone said no, or I was okay if someone didn't want to move forward. I was like, okay, cool. See ya. Yeah.

[B]

And it's funny because sales and entrepreneurship can kind of have this. Like, you have so much flexibility. You don't have someone breathing down your neck. You don't have someone, like, you can leave a little early, you can show up late. You can just kind of. And sometimes like, ah, that sounds so nice. Like, and if you focus on, like, too much of the freedom aspect of it, as opposed to focusing on this, how to just make it succeed, no matter what, it falls apart kind of quickly. Like, that's the funny thing is, like, what it really takes is more than the 9 to 5. Like, more effort, more focus, more energy, especially at the beginning to, like, break those barriers, and then eventually it can roll into the other side. But what's that analogy they use, like, how a rocket, like, going into Space uses, like, 90% of its fuel just to get out of the atmosphere. You know what I mean? And that, That's. That's sales, that's entrepreneurship. And I'd say even with real estate, it's like, it takes like, everything at first just to do, like, the smallest part of the journey. Then the next million miles are a lot easier and take less fuel than the rest. And it sounds like that's kind of how your sales entrepreneurship career started.

[A]

Absolutely, dude. And so for that second year of my career, I was just in grind mode. Like, I was cool with staying late. So for context, I operate out of credit union branch locations, so I would stay till like, five or six most days. Making referral follow up calls, like doing paperwork, grinding. I used to be really afraid of selling because I hate pushing people's buttons or rubbing them the wrong way or like stepping on people's toes. And I just realized, hey, like, if I'm going to do this, I have to just be okay with asking for a sale and I have to actually move forward with it. And if some people get uncomfortable or they don't want to move forward or whatever, that's fine. But I try to get comfortable with pushing forward and moving forward with the sale. And so I just, I learned more about selling. I learned more about getting good at my, my niche way of selling and my specific role. And that allowed me to, to earn a lot more than I was previously used to.

[B]

I love that so many times. Yeah, you just gotta like step out of that comfort zone and just find a way to make it work. And I love it when it's like, I feel like people like you are sometimes the best at it because they do have that conscious where like, oh, I don't want to just be a total jerk and bother everybody. And if you can find the balance of pushing people to action, which people need to take action, that's one of our biggest things in the school. We're like, just buy some, like is how like take action. You'll learn more from doing like it's something's the best thing in people's lives to actually take action. And as a salesman, like you can help people do that. And if you can filter that with like not being a pushy jerk, you know that that's when you're going to hit the sweet spot. You might not get there as fast as the guy just comes in running like telling everybody what to do and everything. And they're like, okay, you get some deals, but it's not going to be as sustainable with like referrals and relationships and everything like that. So it sounds like you, you might.

[A]

Have the sweet spot there. Yeah. Thanks dude. So long, steep learning process and learning curve. Yeah. But I was able to get into much more of a groove. And I also just realized my priority wasn't to just take it easy and go home every day. It was like, I want to make a ton of money so that I can put that into other stuff so that eventually I don't have to go in and make a ton of money. Like I can, I can let other stuff take care of that for me.

[B]

I love it. So let's pivot back to the real estate then so you buy this House, you know, you're making decent money, you can qualify for a good loan, you buy a nice new home, and then what? Are you guys still in that home? Or what happened to that? Did you end up pivoting and turning to investment? Are you still you living in it? And what led to the next deal?

[A]

Yeah, so that was March of 22, so about two and a half years ago. Okay. So my mindset for the first year was crap, dude. Like, we messed up. Like, we shot ourselves in the foot. We bit off more than we can chew as far as, like, we bought, like, a cool, nice home rather than prioritizing, like, the long term. Long story short, you made a comment earlier about just buying something and getting in is better than not. And so I've realized over the past year for myself, like, hey, maybe this wasn't the best move, but it was still an awesome move. So we've been in that home for the last two and a half years. Um, and in that two and a half years, I was always trying to figure out how can we turn this into more of an asset instead of a liability. So, I mean, I looked at everything from, like, I looked into building a little casita in our side yard to. To rent out. We did a bunch of different, like, put a bunch of different efforts into, like, trying to turn it into more of an asset. And so eventually we got to the point where we were like, hey, here's an idea. So we have a front room. So it's just me, my wife here, and it's like, the home is too, too big for us, honestly. And so we. There's a front den area that has never even been touched. So I have a buddy who's a contractor, a general contractor, and I was like, hey, can you frame out another bedroom for us? So we have four bedrooms now. And then we spent a little bit of money to have them frame out a bit for us. Nice. So I thought, hey, like, I can't change the house, but I can add an additional bedroom here. So we did that. We took a HELOC out. We didn't use it, but we just took it out because I was like, hey, we made the decision to move in here. What is something that I can do? And so went to a local credit union and qualified for a HELOC and open that so that we had that as a tool to use.

[B]

Yeah. Which, like, I strongly encourage everybody to do that, whether you know what you're going to do with it or not. Like, if you do it right, they're Free. They don't cost anything to open, and then they don't cost anything to hold unless you're using them. So if you're not sure, just open it now while you qualify, while you have equity and just sit on it. And then you have this tool when you're ready, as opposed to sitting around waiting until you find something you need it for. But now it's a little too late by the time you actually get the HELOC open. So everybody, go open a heloc. If you got equity in your primary, open it while it's still your primary before you move too. That'll be a lot easier.

[A]

Absolutely. Yeah. So we were just trying to think of ways that, okay, like, we made our bed. Like, how are we going to figure out some different avenues to utilize this? So, yep, we opened heloc. We had an additional bedroom framed out. So that was in March of 22nd. Flash forward about a year from then. We had built up some additional savings and we were like, hey, like, let's start looking for our first investment property. So we were looking for a few months, dude. Like, we were looking at a bunch of different options, different properties. So Eric Gubler, I know everyone that's on here talks about Eric because he's a stud. Eric's a good buddy, and we've used him as our. Our agent multiple times now. And so we were looking at different properties, trying to figure some stuff out, and mostly just through Zillow, dude. Just the bread and butter. Zillow just here in town. Because me, with my inexperience in real estate investing, I wanted to find something that I was closer to and could, like, go see instead of finding something out of state that was probably a lot cheaper. Because as we've talked about, as you've talked about on this platform, and as most people know, like, Utah, Utah's hard to find deals in as opposed to other areas for a number of reasons. So I recognized that. I knew that. But we still were looking here in St. George. So long story short, we found a saw a property on Zillow. It was here locally and it was older, so it was built in the 70s, but it was two blocks from the local university here, Utah Tech. Nice. So it was like, shoot, dude, that looks super interesting. It has six bedrooms in it. Oh, perfect. So I was like, shoot, dude, that's worth looking at at least.

[B]

Was it currently being used as student housing when it was for sale?

[A]

No, dude. So crazy story, crazy backstory. A buddy of mine from here grew up in that house. Oh, nice. So, like, he grew up in it, and it was just currently being owned by a family, and they were moving out of state, so they were selling it. So I remember hitting Eric up and just asking, hey, can we go check this out? And he was like, actually, dude, that's crazy, because I've had a bunch of people already hit me up about it. And I was like, oh, shoot, dude. So I don't know how we ended up getting over there, but we went and walked the property. There were a bunch of other people looking at it with other agents. So me and my. This is my first time looking at, like, a property that's already occupied and on the market. And I was getting nervous.

[B]

Yeah.

[A]

So we walked through, and not only were there six bedrooms, but the master bedroom. So backstory. The house was gross, dude. Like, it was nasty. And so me and my naive brain, I was like, this place sucks, dude. I don't want to buy this. It's gross. It smells weird. Yeah. Like a weird. A weird energy there. Like, it had definitely been, like, haunted at some point. And I was like, I don't even want to, like, bother, dude.

[B]

This is not something I'd be proud to own.

[A]

Like, I'm out. No. But a couple of things. It was literally two blocks away from campus, so walking distance. They had a huge backyard with a pool that was empty. Like, the pool is empty. There are a bunch of other people there. And so the master bedroom was way weird. It was a huge master bedroom that had been sectioned off into three sections. Oh, wow. So initially, like, Eric and I were like, dude, that's cool. We could do something with that. And then in the downstairs, there's two levels. In the downstairs basement, there was a huge, massive living room, and they had, like, DIY'd two more bedrooms. So it, like, looked terrible. There was a foot gap at the top by the ceiling where they didn't finish it. So it's just way weird. And so in my mind, I was still hesitant. I was legit. Kept going back to, this place is gross, dude. I don't want to even bother. Yeah. And Eric. And Eric literally said, if you don't buy this, dude, I'm going to. And so I was like, geez, dude. Okay. I guess. I guess I'll take a deeper look at it. And so we put an offer in on it as an investment property, and we didn't get it. So our first offer wasn't accepted, and they went with someone else. I was super bummed because I was like, dude, this okay. Like, if Eric thinks it's a good opportunity, it's a good opportunity.

[B]

It's funny because you go through all the emotions of it. Like, I don't. Like, first, ooh, I found something cool.

[A]

I want to go see it.

[B]

And then like, oh, I don't want this. Like, maybe. I don't know. And they're like, okay, I'm going to do it. And then you don't get it. It's like, oh, my gosh. Like, all this roller coaster for nothing.

[A]

Exactly. Yeah. So we didn't get it, and I was super bummed. I was like, crap, dude. I guess we'll just look at the next one. So we started looking at some other properties, and a week later, Eric called me, and he's like, hey, the first offer or the offer they accepted fell through for whatever reason.

[B]

So then Eric comes back to you and is like, hey, it's still available. So after this whole roller coaster, if you want it, you don't want it, you can't get it.

[A]

Ah.

[B]

And then it's back on the table now. So what do you do?

[A]

Yeah. So in that conversation, he was like, as a side note, this is the second time it's fallen through. So they had listed it several weeks prior. Someone had gotten under contract, and it fell through. They had gotten the second individual under contract. It fell through again. So we were third in line, and so he's like, hey, do you want to put another offer in? And so we did. I think it was just the same one that we had originally put in. Yeah. And they accepted it. And I was like, dude, let's go. Like, that's so cool.

[B]

Was there anything specific about yours? Like, was it cash or was it just financing, like. Or what? You know, because that. Was there anything unique about the offer or just traditional, conventional. Oh, dude.

[A]

What I'm trying to think it was. Yeah, it was just traditional. It was just conventional financing. Yeah. So come to find out. So we obviously ordered an appraisal and an inspection, stuff like that. The appraisal looked good, but I remember going to meet the inspector, and he was like. He made some sassy comment, like, I hope you're good at fixing stuff.

[B]

Yeah.

[A]

What does that mean? What does that mean? Dude, I already know the place is.

[B]

Weird and needs a ton of work.

[A]

Don't rub it in. So. So we have, like, a list of, like, 50 things. Dude, sure. They need to be fixed. The biggest thing was the roof. He's like, the roof is in super bad shape. And so come to find out, that's why the first two buyers have fallen out of contract is because they had asked the seller to pay for the. The roof repair. And she said no. Gotcha. And so we were in. We were third in line, and repair was going to be like 15 to 20 grand. Yeah. And so we asked for the same thing. We were like, hey, like, we're super interested in moving forward and we'll make the other stuff work, but we need you to pay for the roof. And so I think in her mind, she's realizing, kay, no one's going to move forward with this thing unless I take that step. And so we were able to negotiate that, dude. And she actually paid for the roof. I love that.

[B]

Like, if you had been the first buyer and you'd set down exactly like you did the exact same thing as the other ones, you would have done the same thing if you're in first or second and would have got rejected. But because you were the third one, it worked out in your favor. I love that.

[A]

Yeah, no, thanks, dude. And we also tried to be an. Eric's a super good negotiator and people person. So he communicated, hey, our counteroffer is that. So we put a counteroffer in, like, we need to have you repair the roof. So we were in. I think we were a few days before earnest money went hard, and we countered again. Or we essentially said, like, hey, can you pay for the roof? Don't worry about all the other repairs that need to take place, because there were a bunch of other stuff. Like the pool was completely unusable. It was broken. There's a bunch of other stuff in the house that was just from insulation to windows to a bunch of other stuff. We said, don't worry about that stuff, just the roof. Um, and so we negotiated that into the. The buying process. So the. The roofing contractor completed the job and they were paid at closing out of the. Which is crazy. Yeah.

[B]

Wait, they were paid out of. So break that down if you. If you know the details and maybe Eric just put it all together for you, which is like, that's one of the key things of success, guys, is have the right people on your team. You don't need to know everything. But can you break down how you're able to do that?

[A]

Yeah. So I essentially think. And Eric would be way better to, like, work out the details, because we just did this with a. Another property as well as a side note. Oh, cool. But essentially the. So Eric has a good relationship with the roofing contractors, the local roofing company here. In town essentially said, hey, we need this job done in like a week. And because of the relationship, like, you, like, will pay you for the job at closing. So, like, from the proceeds of the home sale, the seller will pay you from their proceeds go essentially be cut a check at closing for the job rather than the seller paying out of pocket right then for it. That makes sense.

[B]

Yeah. Okay. So it really wasn't that crazy, but it was like, because the seller's like, I don't have 15 grand. Like, that's why we're selling this thing. And you're like, well, I don't have. I don't want to put another 15 grand on top of my down payment and closing costs. So he got the roofer to pay for the roof. So you knew it was done in the promise from the seller that they had paid for it, but it came out of just the proceeds. And it was. This was all escrow. Like, it probably went straight to the roofer, not even to the seller and.

[A]

Exactly.

[B]

That's so cool. I love that. And then you didn't have to pay the 15 grand, and the seller didn't really feel like they were. Because it was just coming out of the profits. They didn't have to, like, come out of pocket. And then you back out and they're stuck with this house and 15 grand out and that they don't even have.

[A]

Exactly.

[B]

Which again, like, it goes to show, like, getting. You know, people say, I was just talking to a buddy the other day, and he was just saying, he's like, deals aren't found. They're made. Right. And like, you make it into a deal by getting creative and finding a way to make the seller happy, make the buyer happy. Like, what does everybody need? And you get a creative way to make that happen, even if it's as small as a roof. I mean, that. That scared away two other investors, but you guys found a way to pull the trigger, you know, partly timing being the third, you know, on. So as you had more ammo to be like, look, you're going to have to deal with this with everybody. But again, I think you're right. I think a lot of it came from. From the negotiating skills from Eric to be able to break that down and find a creative solution. So that's awesome.

[A]

Absolutely, dude. Yeah. So the. The people skills from Eric on the negotiating side and then the relationship with people, like the roofing contractor and then, like, the selling agent as well. Obviously he had really good communication with him as well, so. So, yeah, dude. So in that whole process. And, like, in. So this is my first time, like, running numbers and looking at, like, whether or not this would be a good deal. And so I learned a lot of that through the school. Right. And Eric happened to be my coach. Well, not happened to be. I forced him to be my coach in school. But through that, we as. As we all preach, right? Like, going through the numbers to decide if something is. Is worth pursuing or not. So we went into it with the mindset of, there are six bedrooms here, and there's enough space that guess what? We are going to add two more. So that same buddy, who's a general contractor, that framed out an additional room for us at our primary residence, we contracted him out for that job as well. So with the master bedroom that was really divided, we had him put in and frame in two additional walls. So we had some concrete rooms there. And then we had him frame out two additional rooms downstairs for a total of eight. So we have eight bedrooms in that property and decided to full send it, dude. And rent it out by the room, so. Awesome. Yeah. So that was my first go around with anything in that space. And just a crazy learning process, dude. It was so good to go through it, because I am not, like, handy at all, dude. Like, I could barely even, like, frame, like, hang a picture up, dude. So I had to. And what Sammy, I decided was, like, if we're going to do this, we're going to put a lot of sweat equity into it and do it ourselves.

[B]

Okay?

[A]

So, yeah. So long story short, the seller. This was the middle of summer last year, so it was in July. And once the seller moved out, I was like, hey, we got to hustle so that we can buy the school. Exactly. Yeah. So we had, like, a month to get it all ready. And there was so much crap that had to be cleaned up, dude. Like, there was so much stuff in the house. The. Every single wall in the house was a different color. So anywhere from tan to brown to lime green to Barney purple, dude, like, every wall is a different color. Downstairs was just concrete. There wasn't any flooring. So it's just concrete flooring. There weren't any appliances. There weren't any blinds anywhere. Like, the property had weeds everywhere. Yeah. So we just decided to hustle, dude. So we went over, like, I went over after work many days during that month, and Sammy came over and, like, we were painting.

[B]

You actually did it all yourselves?

[A]

Yeah. So no way. And luckily, we had some friends that helped, too. So, like, we had some friends come over and Help as well. But we, we painted so much of that freaking house, dude. And for three days between the seller moving out and us like closing, there's like a three day window somewhere in there where they turn the utilities off. And so we're painting in like 100 degrees inside the house, like, and I didn't want to pay someone to do it, right. I didn't want to pay thousands of dollars to have someone paint the house. And so we're in there painting. I installed the blinds myself. I'd never done that before, so I learned how to do that. Bought used appliances off of Facebook Marketplace and like installed those myself with the help of some buddies. Learned how to install like LVP flooring downstairs.

[B]

Yeah.

[A]

And a couple of the rooms. So I was just like, screw it, dude. I'm gonna. I did, I did a job that someone knew what would do, right? But put some LVP flooring into the. The two new bedrooms downstairs, man. Dude. Yeah. So we just, we decided, hey, we don't want to pay professionals a ton of money to do it, so we're gonna try and do it ourselves. And so luckily we had some awesome help from friends, but for the most part it was us doing it, dude. And so learned really quickly how to figure some of that stuff out on our own. And then as far as like the listing of it and like the advertising of the rooms, we just sent it and so we listed each room for rent.

[B]

You just list on Facebook or Zillow.

[A]

Or both Facebook and then local ksl, which is a local platform here in Utah and just rented out by the enlisted by the room. So we advertised it as two blocks from campus, private bedroom. We were going back and forth whether or not to do guys or girls. And I'm sure everyone has their own opinions and experiences. We did guys and in my experience, I don't know about girls, but the guys that I've dealt with seem to be a little bit chiller as far as like, they don't need it to look super nice or smell good or anything like that. So they're cool with it not being perfect. They just want a place to sleep and then it be close to things they need to get to, whether it's school or work.

[B]

Well, I love that. It's like you got to play to your strength on it. If it's like, if it's this brand new immaculate, perfect home, you know, maybe you get some like girls that are going to treat it soft and keep it clean and take care of it. If it's a little more beat up and needs a little repairs here and there. Find some dudes who don't give a crap and they'll, they'll be fine like doing some manual labor on it too. It won't be a big deal, you know, in general. You know, obviously these are generalities and assumptions, but, but it's just like there's not a right or wrong way. It's just like we'll play into whatever makes sense for your situation. So I like that.

[A]

I like that. Yeah. Thanks man. So long story short, we were able to. And it was just such a grind, dude, because school was starting and we, I think we only had like two or three guys in there as of like August 1st. And I was like, crap dude. Like, yeah, this is such a grind. It's so like, it's literally billion degrees down here. It's super hot. Like we're trying to like renovate and do stuff. So eventually we got, I think we had, I filled six of the rooms and that covered the mortgage.

[B]

Nice.

[A]

The six rooms covered it. And the two additional ones were the cherry on top. And so long story short, with the two new bedrooms, we didn't have heating or cooling like H vac in those two rooms. And so I was like, okay, well that sucks. That St. George is freaking hot here. So I just tried to get creative and so I bought mobile heating and cooling units to just put in the rooms. So they're just like stand up towers. And I let people know that we're looking at the room. Like, hey, just so you know, these rooms don't have heating and cooling in the system. So you have these two units that are here. And I advertise those two rooms for less per month for that reason. And so didn't get the seventh room filled until September and the eighth room until October. But we got them, we got them all filled, which was awesome. And so, so they were all filled. But then just like knowing the nature of the beast, like it being an older home and we didn't have the seller fixed everything, I knew there were going to be things here and there that would come up. And so I asked around and got the number and contact for a really good plumber, a good electrician, and then like a good like lawn control individual. Because over the past year that we've owned it, we've had a couple different like plumbing issues. Like one of the, like the master bedroom toilet just broke. Random, random stuff has happened here and there. Being an older home and knowing that we like, we knew that Going into it, there would be some issues. And that was really hard at first because I was like, shoot, dude, I'm not trying to pay like 300 bucks randomly to fix a toilet or 150 bucks plumbing to come check out this thing real quick. And then like the, the washing machine broke. One time a few months ago, a kid's ceiling fan broke. I just realized for me, all in all, like, it was so worth it. Number one for the experience that I had renovating that sucker and going through the buying process and the negotiation process to like getting it rented out by the room. We have eight separate leases, so I'm essentially like managing the property as well because I didn't want to pay for a property manager because I just knew I could do it on my own. So that's kind of been like a little part time job I've had to take on is managing these eight separate leases. And then I knew that things were going to crop up as far as little repairs here and there. That at first was super annoying, dude. I was like, I don't even know if I can do this. There was one month, I think in October of last year where I had like three things break. It was like a toilet, a ceiling fan, and a leak. And I was like, wow. Like, I don't know if I did the right thing doing this, dude. Like, it was a lot. But long story short, most of those small issues have been fixed. I've gotten a lot better at like the property management sides because I've been doing it for a year with these same guys living there, and it's totally been worth it.

[B]

Yeah, that's cool, man. It's funny. It's like, it goes back to that, that fuel analogy, right? It's like sometimes at the beginning, it just takes all the fuel just to get out of the atmosphere, right? And it's like I feel like some of the first deals, I'm like, I don't even know if, like it's just all this time, all this effort, it's like all this headache. But it's like, that's your tuition. It's like that's how you're learning, that's how you're growing. Don't even, Even if it's not profitable, you'll learn so much. And now you have these connections. I was just thinking you're like, oh, we have this guy do that one room in our first house. Now we had him lined up for the second house. And if you ever buy the next house, which sounds like you did do that roofing thing again, you're like, oh, now we know how to do this. And you have all these, like, tricks and these connections, and, like, they all build off of each other from the first deals that maybe weren't even that good of a deal. Like, I have some deals I bought, and they, like, they weren't even that good. But then I had this property manager running some of them, and then he connected me with. With two others. Dildo were, like, amazing. And I'm like, if I hadn't been taking action about those okay deals and got them being ran, then I wouldn't have been connected to this better deal. Like, it all just compounds and snowballs on itself because you're in the game as opposed to sitting aside waiting for that perfect deal to come along, which. Which, you know, obviously you're seeing that happen, which is super dope.

[A]

Absolutely. And someone told me. Someone gave me an analogy between real estate investing and golfing. So, dude, I'm not the best golfer by any means. I love going, though. And I just feel like in both cases, the. The learning curve is super, super steep at first, and then at some point, it starts to level out, and you're like, hey, I got this. And you progressively get better and better, and it gets easier and easier. But, like, at first, like, if you first start golfing, you're like, dude, this game sucks. Like, who wants to golf? Like, I can't even make contact with the ball. I can't hit anything straight. I don't know what I'm doing. And so I felt that way with that first deal. I was like, dude, I have no idea what I'm doing. I'm spending so much time and money, I don't even know if it's worth it. But looking back a year later, it's totally worth it. And things are so much easier now.

[B]

And you haven't even got the sweet spot. I mean, give it 10 years, and you're sitting on hundreds of thousands of equity. You can roll into something, something bigger and bigger. And, like, that's when it's like, the snowball really takes effect, you know? And it's like, it just does get better and better as time goes on. So. That's sick, man. So see, let's. Let's do a quick on your third property, and then we'll. We'll bust into our final four questions, and we'll let you go.

[A]

Perfect. Yeah. So.

[B]

So. So tell us about the third one, then.

[A]

Yeah. Yeah. So number three. So. So Sam and I have been married for about Two and a half years now. We've been in this primary residence, the first home that we bought for two and a half years and we both had the urge to just move and switch it up and find something different. And for me, I just like to keep things simple. So from my perspective, I want to, I love and want to invest in real estate more and more. And I know that a simple way to do that is by putting 5% down on a single family home. So we've tried to put two and two together and just say, hey, like let's find property number three and let's move into it as our new primary residence. Yeah, it's, it's the least amount down outside of seller financing and we want to switch things up anyway. So let's try to find, let's kill two birds with one stone. And so we've, we've been looking for about honestly like six months trying to find something that would check both boxes off. Someone that we'd like to live, that we like. Yeah. But not having the blinders on that we had with the first property and just trying to find something that's super nice, that's not actually something that's amenable to, you know, a real estate investment. So long story short, we been looking here in southern Utah, we want to stay in St. George. And so Sammy grew up on a lot more land and space. And so we were trying to find something that had a little bit larger lot size or acreage, which is way hard to find in southern Utah. It's either you can find a really nice home that's backed up against someone else or you find a really old home with a huge property. So it's kind of one of the other. And so long story short, we found a pretty cool looking property out in Dameron Valley. So it's about 20 minutes outside of town. It's definitely more like farm country. It's removed from the metro area here. But it was super crazy. We're just on Zillow and we both noticed it and the lady had listed it three weeks earlier and she had slashed the price five times in three weeks by 50. She's just like, okay. And so, yeah, so my mind, I was like, there's either something weird going on here, like she's, she's dealing drugs or something's going on, the feds are after her, or she's just desperate to sell and she has a crazy situation. So I went out and saw it with Eric again and it was dope. It had the property itself Was huge. It was zoned equestrian, but the home was built in the 90s. And so again, my naive brain was like, this place is kind of gross, dude. I don't want to live here. But it was intriguing enough that I walked away going, like, okay, that's interesting. But I'm not super sure about it. Eric called me a week later because she has slashed the price again. And he was like, hey, do you want to go in on this as an investment with me? I feel like. So from his perspective, he was like, hey, let's buy it. We could take out some hard money and renovate the crap out of it, and then a year ish from now, we'll turn around and sell it. And we both thought that we could add a ton of value because of how much he had dropped it, and then just adding some sweat equity ourselves.

[B]

Yeah.

[A]

So him saying that got my mind churning. Like, okay, Eric, think it's a good enough deal. And in order for that deal to work, we need to buy as a primary residence as far as the cash we have to put into it. So I just thought, dude, honestly, let me chat with Sammy. We might just want to move into ourselves. No offense, but instead of going in on it as a partnership, maybe we just want to do it ourselves. So, long story short, we decided to put an offer in for way below what she'd already slashed it to, and. Okay, didn't hear back. Yeah, so she had. She had slashed it six times in a month, and we put an offer way below what she had listed it at, and we didn't hear back. We didn't hear back from her. So for a week, didn't hear back at all. And she's. She's kind of a. She has a volatile personality, as does her agent. And so it was just long back and forth. Didn't hear anything. So I reached out to Eric, and I was like, hey, like, we haven't heard anything. What. What do you think we should do? And so we chat about it, and we just said, hey, like, let's put another offer in. I'll contact the selling agent. And we just increased our offer price. And at the price she had dropped it to, they had a lot of interest. And so Eric, again, through his people skills, his relationship management, we put an offer in, and they accepted it with a counter of. She needed two months to lease it back from us in order to move out and get her animals out.

[B]

You're, like, fine.

[A]

Yeah. And I was like, dude, take as long as you want.

[B]

Yeah, we're in no rest.

[A]

Right, Right. So, yeah, long story short, dude, we were able to get that under contract, but it was the same situation, dude. The roof had to be repaired, so we had the inspection done, and the homeowner's insurance agent literally said, like, I can't cover this unless the roof is repaired. So you got to figure that out. And so we did the same thing that we did the first go around with the other. The other home. We worked with the contractor to get it fixed before closing, and then at closing, it was kind of check out of escrow.

[B]

Love it, dude. So, you guys. That's awesome. Congrats. So you guys are up in Dameron Valley or have you moved in yet or.

[A]

Still renting? So she's still. She's still leasing it back from us. She has about a month left to lease it back from us. So, that being said, the final part of the story is that we now have to get our current primary home rented out. Right, sure. And the initial thought was a couple years ago, like, I'm not sure if we're going to be able to fully make up what the mortgage payment is, but we added the additional bedroom and.

[B]

Yeah, I was gonna say get the added.

[A]

Yeah, Yep. So we have, again, five bedrooms. We're renting out. And a summer sales kid hit me up on Facebook Marketplace, and he's like, hey, like, we have six buddies, and we're trying to find a place for all of us, and it's hard to find a place that we want to live. We'd love to pull the trigger. And so we just got them under. We just signed leases with them a couple days ago, and they're going to be August 1st, so once we move out, they'll move in. So the pieces have fallen into place. Super. Well, so blessed in that way.

[B]

And you're able. You're able to rent that out enough to cover the mortgage and everything after.

[A]

You leave and some. Yeah, that's great.

[B]

That's great. Which was the big fear, and that was with you, like, say, buying it without that in mind. Not considering that. Not doing it perfect. But. But taking action, making. Making moves. And now you've got, you know, three in your portfolio and growing.

[A]

Yeah, thanks, dude. And I. I attribute a lot of that to. There was so much fear the first two deals, because I just assumed that they either weren't going to work out or I didn't know what I was doing. And then in hindsight, obviously, through the people, relationships that we have, and then through doing a lot of our own effort in they've definitely worked out. So that fear was pretty irrational. It made sense in the moment, but looking back, there was no reason for us to be afraid.

[B]

I love it, man. Well, we'll bust through our final four and we'll let you go. I appreciate your time so far. If people want to reach out to you or follow you or get in touch with you, what's the best way for people to do that?

[A]

Just Instagram, dude. So it's just my name, McKay Dobbins. Perfect.

[B]

Sounds good, man. All right, so question one. If you had to start your real estate journey over completely knowing now everything you do know though, what would you do different?

[A]

Yeah. So I don't view the first home that we bought and moved into as a. As a mistake, but I do feel like doing it over again. I would have bought something that was just a little bit more conducive to being a long term part of our portfolio. It obviously worked out at this point in the game, but looking back, I wish I would have just focused a little bit more on finding something that was even more conducive to. To being rented out, covering the mortgage and then some, and started.

[B]

Love it. Question number two. Book or podcast? Besides any ones that we're associated with, would you recommend people check out?

[A]

Yeah, pretty basic, dude, but Rich Dad, Poor dad is like classic. It's so, it's so good, dude. I know everyone's read it and it's classic, but I just feel like it has so many good points. Biggest one being mindset and priority. Right. And then the other one is a classic as well, but just how to win friends and influence people. I just feel like those are two really good books to have amazing content and they're. And they're simple.

[B]

Yeah, I love. They couldn't be recommended enough if anybody hasn't read those or if you have and it's been a few years, like.

[A]

Yeah, go check them out again.

[B]

What's one of the most expensive or interesting mistakes you've made in real estate investing?

[A]

Yeah, so I mentioned it earlier and I don't know that I, I haven't been doing this long enough to have made a big mistake yet. I'm sure I will, but I would even just say like our first property that we bought, it was done more so out of like buying up to what we could qualify for. So like pushing, pushing the limit in terms of what we could qualify for just because it was a little bit nicer and. And then I put 5% down instead of 3 just because I Didn't know any better. I just thought that's what you're supposed to do. When we could have saved some cash and just put 3% down.

[B]

Yeah, and again, those are pretty. Those are great moves. I mean, they're not even necessarily bad, you know, the 3%. Then we had an FHA loan. You'd have, you know, all those issues, you know, and PMI for life on it. So it's like I don't even know if that was a mistake. And, and honestly, I love it when people leverage as much as they can qualify for that is self sustainable. When you leave, which ended up working out for you because now you own a way better asset. And when that goes up 20%, 50% doubles over time, that's gonna be a lot better than if you bought the cheap crappy thing doubling in value. Cause you'll make way more wealth. So those mistakes are wins in my book.

[A]

So.

[B]

Yeah, man, that's awesome. So just to end it off, what's one word or short phrase to encapsulate why you love real estate investing?

[A]

So I'm going to plagiarize and copy earnest from a couple weeks ago, but freedom. Yeah. I think if you do things the right way and your priorities are aligned correctly, investing in real estate can give you freedom of time and energy that other areas can't quite provide.

[B]

I love it, man. Well, McKay, appreciate your time. We appreciate you sharing the good, the bad and the ugly from your stories. The real estate, it's inspiring. I love to hear it, especially somebody's like, in the thick of it, like you're doing it right now. This isn't, oh, a decade ago. I got rich, you know, or I'm running five companies doing 100 flips. You're just like, this is the real deal, you know, So I love to hear. Appreciate your time.

[A]

Yeah, thanks, brother. Appreciate it, man.

[B]

This is Joe Jensen signing off for the Real Estate Investing School podcast, reminding you to start building that momentum.