Growth & Grace

Wesley Knight 0:00
This is a KU NB studios original program. The following program is underwritten by Crawford management group and Chris glow and does not reflect the views or opinions of 91.5 jazz and Moore the University of Nevada, Las Vegas or the Board of Regents of the Nevada System of Higher Education. Even better than that was the last time, baby

Music 0:35
we back and we back and we back and we back.

Leaha Crawford 0:49
Hey, Julian,

Leaha Crawford 0:50
how you doing? Ready for two ball. I'm ready. I'm ready. Okay, who you got you got?

Julian Rosado 0:55
So you know, I'm represent athletes, right? So my prediction is completely wrong, right? Okay, so what's your prediction? My athletes say Seahawks are going to wipe, wipe the floor with them and like this is going to be a complete blowout.

Leaha Crawford 1:09
I want to say I agree.

Julian Rosado 1:13
Shocked. Yeah, because I thought there. I mean, because of Mike variable, the coach, their quarterbacks playing really well, no, but they all say. They all say like, well, you don't know. You don't know what we know.

Leaha Crawford 1:27
Let me say I was listening well, you know I'm I'm taking from the TV because I don't, I don't really know. I just know I like the Seahawks. They were saying that the schedules this year, that the Patriots had an easier schedule than what the Seahawks have had. They paid tougher, you know, I guess so. Yeah, I am kind of looking forward to it, but I'm gonna miss it this Sunday because I have to meet. I have a meeting at the same time. Oh, really, yeah, so I will be at the meeting looking at my phone. Who's gonna be I don't ask, don't ask, and I won't tell, but I have a meeting during that time, so I am going to miss majority of Super Bowl. I pray that the halftime show, I can play it back. This is the most important. But the Eagles ain't playing, so Mormons watches. My E, A, G, L, E, S are not playing. So I don't, I really, I'm not really concerned this year about, you know, but, yeah, but I'd Seahawks all the way. Seahawks all the way. All right, yeah, anything else you can do this weekend?

Julian Rosado 2:25
No, that's this football,

Leaha Crawford 2:27
football, okay. All right, yeah, enjoy football.

Julian Rosado 2:30
Yep, I understand

Leaha Crawford 2:33
of the year of the year, biggest game of the year, yeah, what I can say is, today, we have a very special guest in the studio with you, because we talk about real estate, every once in a while we've had real estate agents on, we've had mortgage brokers on, but every once in a while, like to bring on an investor, because this is the person that is working with the mortgage brokers and the real estate agents. And they're this is their business, to a different angle, just a different angle. So I had the pleasure today to have Miss Mrs. Anita Ross in the studio with me. Good morning. How are you? I'm very well. This is Penn legacy group. Y'all, yeah, we ARE PENN legacy group. So Miss Anita, I mean, first of all, who are you? Because, I mean, you didn't start off

Anita Ross 3:15
in a real estate career. I did not. Okay, started off. I grew up in Pittsburgh, worked there for a little while, joined the Navy, spent eight years in the Navy, met my husband while I was stationed in Japan, and we married here in Vegas and started our family got out of the Navy at that point and then worked for Ocean Spray cranberries. Oh, nice people like, Are there cranberries in the desert? And eventually came to work for Department of Energy as a government contractor, okay, retired from there after 21 years there.

Leaha Crawford 3:56
And she looks good. Y'all, she don't look like she's much older than can do, right?

Anita Ross 3:59
Right? And retired from there three years ago and during but while I was working there, started investing. Okay, really, just it was a natural thing, mostly because we bought our first home. I was so excited about that. And then after we were in that home, I'm like, it's time to move up. Okay, you know, people talk about a move up home, and was ready to move into something a little bigger, and that decision that we made to keep our original home is what started that kind of organically, as far as investing or having investment properties, and I still hold that property today that we bought in 97 Oh, wow. So that it'll be 30 years. In two years it will, Oh, wow. Okay, so that's what kind of planted the seed, even though I was actually looking into. Yeah, getting into real estate even back then as a realtor, and kind of realized that I didn't think that was my forte, I didn't think that'd be my interest. But when we bought our move up home, that's what kind of really sparked my interest and started looking into other opportunities, and what was out there. So, okay,

Leaha Crawford 5:27
so I will say that you, you, I don't. I don't want to call it. Everybody else calls it, but you buy homes and then you resell them, you fix them up and resell them. Correct, okay, when you first started doing that, I Yeah, how did you feel doing it and go

Anita Ross 5:47
ahead, crazy, nervous, okay, like, just gut wrenching, nervous, just because, where am I going to get the money? Which is what Lamar kept asking me, Where are you gonna get, I don't know. You know, my credit's decent. Let's see what's out there. And we went to they used to do it a lot more back then, these home seminars and getting people to look at buying things for their home, you know, one of those kind of expos that they do, and it was there that we came across a lender who was in the residential market, just trying to get people to buy regular homes, but they were also in the commercial market, and we were able to sit in on their presentation. And that connection, that relationship, is really what started our ability to buy investment properties, the interest rate was much better than so normal interest rates for residential properties were probably around 4% back then, and it seemed astronomical that Hard money these were also hard money lenders. They were in the 7% Seven 8% range, and at that point, it still felt crazy expensive to do this year, they're still around 12% so just over a period of 10 years,

Leaha Crawford 7:19
that went from 7% to 12% correct? Well, it seems okay, so that would so then. But what are normal like? What are interest rates now for homes,

Anita Ross 7:29
so they're still in the sixes, right? Even though there's been, and I'll say low sixes, depending upon your credit and that type of thing. And the Fed just lowered them, I think a quarter point, but yeah, 6.3 right now. Yeah. So even though there's been these fluctuations with the Federal Reserve, it's not a direct tie, 100% federal reserve rate, mortgage rates, but there is a population Right, correct. So that said it was a little easier to get in to the market for us back then, because overall that interest rate for that hard money was low enough that you could afford to do it, and it just got increasingly harder from the standpoint of how much you would pay for the house that you bought, how much you could spend on the rehab, and then how much you could sell it for. So there you I had a pretty well defined range of how much I could buy it for, how much I could sell it for, knowing that I needed to stay, I needed to be able to cover, I'll say, $100,000 between my purchase price and my sales price. Okay, and that was much easier to do initially than it was and finding properties that you know had that amount of, I'll say equity in them, to be able to do that. Yeah, it was. It was much easier to do it then, because the cost, the holding costs, are really probably one of the biggest expenses, buying, holding and selling that doesn't include rehab. People watch all those flipper flop shows and those rehab shows, and people don't look at all the cost that goes into that. They just think, Oh, I bought I bought it for 300 I sold it for 400 I made $100,000 actually.

Leaha Crawford 9:41
Well, you I'll like to dig into that. This is you're listening to growth and grace. I'm Leah Crawford, and we are talking to miss Anita Ross, because we're really digging into what it means when you are buying and selling properties. All right, so let's, let's talk about it. Because I think in watching those. Shows. They give you this big, these big numbers, but really don't dig. You know, they do not, they don't really get in a lot of times dig into it. So when you purchase a property, when you purchase a property, yes, do you normally get your properties from real estate agents, or do you get them from wholesalers?

Anita Ross 10:19
Or I do, but I I have used the same realtor from the beginning. The relationship developed also organically. His son and my son were good friends. Shout out to George trill at Keller Williams Realty. Okay, he's been a road dog for us right from the beginning, and I just approached him when I told him I was getting into this business. I knew that I could not be the realtor. I wanted to go to school, educate myself, but couldn't be the realtor. Well, I was still working full time, so I couldn't see that as an option for me, okay, but yes, work with the realtor, but still investigated wholesaling as a consideration and any other sources where I could find homes. And it just worked out that George always came through for us. He found us homes and did an extraordinary job in negotiating those prices and both on the purchase side and on the sale side. He helped me with and good Realtors should do that. Help you with resources. Help you find contractors. Help you find, you know, a pool guy help you find that type of thing. A good realtor will help you with those things. An experienced Realtor will help you with those things, because they have those contacts, because right there, there their experience would have exposed them to that. So I'm not, you know, trying to say anything bad

Leaha Crawford 11:59
about but no, but that's some nuggets for realtor that you need to build these relationships.

Anita Ross 12:04
A new realtor should be doing the same thing, looking for their relationship. Understand the cost, correct? Yeah, but that him helping me with that was a great benefit, because those, those people came to me with experience, proven experience, you know, they these are contractors that had, you know, done work for his other customers and things like that.

Leaha Crawford 12:31
So when you purchase the property, now you're not only paying so you are paying, number one, the cost of the property, the cut the purchase price of the house, then you're paying the agent fees,

Anita Ross 12:41
agent fees, or as the buyer, as the buyer.

Leaha Crawford 12:46
Now let me ask you this, but sometimes does the seller cover some of those costs, or do you always cover those costs for the agents?

Anita Ross 12:52
I budget when I'm looking at a property to make a decision about whether I'm going to buy it, I establish a budget up front. I can't pay more than this amount, okay, and I can't probably sell it for more than this amount. I have to be realistic in that, and I budget for those costs assuming that I won't get any help, so that, if I do it helps then, you know, thank you. I'll get some, you know, better fixtures, or I'm like, you know, upgrade.

Leaha Crawford 13:22
So you're talking about, so when you buy the house, the purchase price of the house, current the real estate agent, correct? Now, are they buyer and seller? Agent, buyer and seller agent, fees. How about title insurance and title in anything dealing with the

Anita Ross 13:34
time, any title cost, title cost. So I usually budget roughly around 10% of the purchase price, or total for closing costs, okay, to buy it, and I do the same on the selling, selling side. Okay? Because sometimes, as I'm selling it, the buyer needs help. Okay? You know, if I can negotiate those costs down or out along the way, that's George's job to do. Okay? And, you know, we we try to do that. A lot of it will be based on how long did it sit on the market? How long did it take us to sell it, that type of thing, right? So by the time we're at the point of ready to sell, what happened? Did I have any hiccups along the way with the rehab that end up costing more money? Well, no, we have, we haven't gotten to the right yeah, I'm just saying,

Leaha Crawford 14:20
so we're decisions cost. So we're talking about, so when you're buying it and when you're selling it, basically you have closing costs and agent fees that you need to consider correct. And you said 10% for the closing costs, and then whatever the agent

Anita Ross 14:35
fees are about what No, all of that is in that 10% all of that is an, oh, okay, all of that. I mean, the industry is still roughly around 3% okay, for each agent, so there's 6% it's negotiable. Yeah, it is negotiable, absolutely, all right, for as the buyer and the seller, you can negotiate that and your agent. It is your agent's job to help

Leaha Crawford 14:58
you with that. All right. So then now we got, so we purchased the house. Yes, we got the house. Yes. Now we got to go through and look at it to figure out the rehab

Anita Ross 15:08
you got to do that before you even close. Yeah, okay, you have to try to figure that out before you close. So while we're, while we're, when I first look at the house, I bring a contractor with me and have them try to help me scope out what that work is going to look like, so that we can try to very early, come up with a number, so that when I make an offer, I already have a general idea of how much I'm going to spend. So let

Leaha Crawford 15:35
me so let's back up, guys, because that could also be the thing. You know, sometimes you're buying a house sight unseen, you don't know what's going on.

Anita Ross 15:41
It's always good, though you don't recommend, not ever. Do I recommend?

Leaha Crawford 15:45
Okay, so when you go through a house and you estimate what's going on, like, Do you have a rough amount? Like, how much a bathroom might cost, the kitchen might cost, windows,

Anita Ross 15:55
floors, roof, yes, HVAC units you have, you have to get that heaters. I mean, yeah, you have to get that cost. You got to be in the ballpark. Okay. Can't just say, Oh, I can, you know, redo this bathroom for $500 well, what are you gonna do? Just clean it, right? Well, it it, underestimating cost is the worst thing that can that you can do in that respect, and actually, my experience, when I was with Department of Energy, I worked in procurement, worked on, you know, understood different contracts that they did, construction contracts, no question, do you always have to keep what they Call float in your in your estimate, you have to keep yourself a little cushion to fall back on. So even if you think, Oh, I can redo this bathroom for $500 well, you need to give yourself 10 to 20% cushion, cushion. Okay, on, on that whole project. Now, do you do anything with foundation issues? I am fortunate that I haven't had anything so severe, and there are still ways to compensate that one of our early flips did have. Once we took the flooring up, we did find a pretty extensive crack, and I did. I called a few engineers to have them come and look at it. And the good thing is, it was not so terrible that, you know, I had to dig up the slab or anything like that. They're like, you can seal this, and it was based on a certain width of that crack. It just, we just had to be mindful of the type of flooring that we were putting down over that crack, to understand that, you know, there could be some challenges, but

Leaha Crawford 17:47
you did stop to get the professional opinion absolutely and not just move

Anita Ross 17:51
forward correct. It was, it was, I mean, I'm not, I'm not an engineer, but I saw a very long, eight foot crack crossing, crossing the living room area. And let's just stop and look at this before we go any further. Now, some flippers will be like, I can just put something over it and keep moving. You can't really, and nobody's gonna know, no, right? Because, because you have it on the market, you sell it 30 days, you know, and you're in your guns, out of your hands. It's out of your hands. But what I don't want to do is, I didn't want to take the risk of putting that say, you know, vinyl plank flooring, or even some tile or something correct, and it cracks just the minute somebody steps on it right because of

Leaha Crawford 18:45
the crack in the floor. Correct.

Julian Rosado 18:47
You have multiple contractors to come see the property. Yes, to get multiple

Anita Ross 18:51
Absolutely, okay, absolutely, yeah. And that was something actually my realtor, again, George, recommended is, and it is the nature of federal contracting business that you that you do that anyway, right? Government requires it. But he was adamant that, well, I got three, well, get three more, okay, but, you know, clocks ticking,

Leaha Crawford 19:19
but absolutely now, do the contractors charge you? Because I know in certain cities, okay,

Anita Ross 19:24
typically, typically, they do, do not charge you, that some do

Leaha Crawford 19:28
No, and some, in some cities, the contractors charge you to come out and give you a

Anita Ross 19:32
minimum document. So it just depends on the type of work.

Leaha Crawford 19:36
So don't now, okay, so when, when you call a contractor out. Do you have them do the entire home? Or do they do, like, say, somebody will come out and give you a bid on a estimate on the kitchen, or do you break it down? Or do you have an entire home start?

Anita Ross 19:52
It depends on the extent of the work. Okay, so in larger projects that we've done, like. Last year, I used a general contractor, so it's his job to pull in the trade. So it just depends, okay, on what the work is, because the county and the state don't necessarily require a general contractor for all work, okay, it just depends on whether permits need to be pulled. Think about it. There's stuff you can do in your home that you don't have to get a permit for if you want to put your own flooring, and you can do that nobody's but the stopping water heater, I think you have to correct so plumbing, you need permits for that if you have a water heater, and you need to do something about that. Yes, things that require permits. I'll give you another example. We converted a room in this most recent project, it was just a room, and we made it a legal bedroom. Well, you need permits for that, and they look at the entire property. They look at the entire property. So to take that from a three bedroom to a four bedroom, they look at the entire property, and they'll point out the other things that are not right,

Julian Rosado 21:00
because that would change the whole mls of a correct.

Anita Ross 21:04
Well, it changes the value, changes the value and everything. So you go from, we went from a three bedroom three bath to a four bedroom three and a half bath. So, all right, well, you're

Leaha Crawford 21:15
listening to growth and grace. I am Leah Crawford. This is Julian Rosado, and we have Anita Ross in here today, because she is living the investor life, and she is breaking down us. Because sometimes when we hear these things online, everything sounds all glamorous, and you know, until you get into it, and then you're really realizing, oh my god, this is way more than what I thought it was. And we're just trying to break down, like the process. So anybody that's in there, I mean, that wants to do it, at least you're better prepared to do it. Yeah, right. All right. So I Okay. I got the house now, I already got some estimates. Now it's time to do the work. Yes, how long do you normally estimate to do the work on a house to get it ready to be sold

Anita Ross 22:03
based on I usually try not to keep a house as far as the repairs, more than 45 to 60 days, if I can, depending upon the extent of the work. And fortunately, I haven't had to hold anything very long, unless it's a very extensive project like the one we just did. But that said, you know, try to, the idea is to try to buy the house, get it done in, you know, 3045, days, potentially before the first mortgage payment listed, right, right. And get it and get it back on the market. So it, it, you know, do I have something to do with a pool? Do I have a lot of landscaping to do? And you had asked me about having contractors. Do you know, individual jobs? Yes, I can. I will hire a flooring guy to do flooring, and I will hire an HVAC guy and an electrician and a plumber and the cabinets and countertops guy. So those are different trades. Typically, not everybody can do everything, and if they can, they're they're normally a general contractor, and they're still bringing in their own trades anyway. They're not doing it themselves.

Leaha Crawford 23:21
And with that, like, is there a certain like order that you do it in? Like, do you do the roof, if there's Roof Repairs, do you do the roof first, so to make sure that everything is okay, or do you do the floors first? Do you paint first? Like, what order do you do?

Anita Ross 23:34
Yeah, so yes, there, there is an order. The truth is, you can potentially work on the roof without necessarily having to do to without necessarily impeding on any other Okay, work, but you and you can do, you would typically prefer to paint before you put in flooring kind of thing. But before you paint, you want to make sure that your cabinets are where they can be set and that type of thing. So it really just depends on what work is getting done. If things can be done independently, then, yeah, my preference is to swarm the property and everybody, but you end up kind of stepping on each other sometimes. So you do have to kind of plan that work so that, yeah, we'll paint first, and then we'll put the cabinets in. Usually something like countertops are almost last in the process, because you got to get the plumbing in first, the faucets and drains and stuff like that. So it really just depends. Got it on the work, okay, but you did

Julian Rosado 24:42
between a just going back to loans, between a hard money loan and a construction loan.

Anita Ross 24:48
So they are somewhat similar in that. So a hard money loan is not necessarily based on your personal credit. It's based on. The validity and value of the project. So hard money wants to know, are you going to make money off it? You know, is it a reasonable expectation that you're going to make money off it? Are you going to be successful? So that said, they are looking at the fact that we had a rental. Remember I said, when we bought our move up home, the we kept a rental, and then a couple years later we bought another one, because I thought it was going to flip then, but then we ended up keeping it as a rental. So they look at that experience and say, Do you have experience in real estate at all? So now you got like, 20 years experience, give or take, well more like 12, but that that said that hard money, so we didn't have to worry so much about our personal credit, because we had experience with rentals, and they wanted us to kind of show that we were going to make money on the house. What are you buying it for? What do you expect to sell it for? What's your rehab cost? They look at the same thing that any investor would do as far as flipping, and if it looks successful to them, then they're going to loan you the money. You have to have some skin in the game. You have to come in with at a minimum 10% down to be able to buy the property. So people that say they can get into flipping with no cash, I just, I just haven't seen that

Leaha Crawford 26:34
okay, and that's and that's honest, and I appreciate, and I appreciate that I really do, because I know we've been, I've been with you throughout part of this journey, right? I've been with you through part of this journey, you know, hearing the good side and then some of the challenges that come along with it. And I want to say to you on the air, it has been a pleasure working with you, even with the challenges, just your mannerisms, your demeanor and how you work through and able to think through it. Thank you and and just keep moving with that. I want to say thank you for joining us today as always, and we will have to bring you back on because we can dig so much deeper into this. And I am, and I think it's a good education for those that are interested in getting into the business, because sometimes everybody doesn't tell you just what you need to do.

Anita Ross 27:25
Everything's not a win. Everything wasn't, you know, perfect, you know, TV show situation. We wasn't. We had hurdles and batteries and

Leaha Crawford 27:36
but y'all work together, and y'all work through it, and y'all, you know, you and your husband. Are an amazing team when it comes to that. So thank you to say thank you, and I'm gonna let you know Crawford management group, so it is tax season. Julian, yes, it is tax season. So yes, yes, if you more information looking for a tax home, 70238257377023825737,

Leaha Crawford 27:59
we are always, always, always, really, you know, just good people. And like to be around good people. So if you look, you know, just, hey, we're here, but Anita again, thank you. I appreciate you. And tell Lamar I said I'm ready when he ready. I'm ready. I am ready when he is ready. Okay, bring that big stack of text paper way. You know what I love about your husband? Because he uploads everything. Tom Lee, he makes sure. Leah, did you get it? Brenda, did you get it? Okay, now let me see, and he's in there looking to make sure. And see harassing me too, all the time. Where's your papers? Where's your papers? Where's your papers? Let's do this all right, y'all until next week. And remember who you got? Seahawks.

Julian Rosado 28:39
I gotta lean towards Seahawks. You see Hawks?

Leaha Crawford 28:43
All right, okay, so it's a Seahawks. It is. All right. Who's your husband rooting for? Not exactly sure you

Anita Ross 28:50
have a player person, not a team person. Oh God. Okay, so we gotta see if his players are playing. Which team has more Ohio State players? Is that where he leads? If they're Ohio State grads, then that's who he's rooting for.

Leaha Crawford 29:07
I love it. All right, y'all and so next week you have an amazing, amazing weekend. Thank you. Bye.

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