Making Money 7 Different Ways on Each Property (Without Even Owning It!)

Henry Washington:
She makes cash seven alternative ways on each actual property deal and by no means even owns the property. Most actual property buyers assume in offers. They assume purchase a property, renovate it, promote it or lease it out. One income stream per home. In 2022, Chauncey was flipping homes and accumulating leases doing 20 offers per 12 months. To make more cash, she wanted extra capital and extra contractors and extra tenants, and which means extra complications. So she constructed a wholly new mannequin. Now she runs a vertically built-in actual property operation. Her purchasers put up the capital and so they preserve the earnings, however Chauncey takes the reduce at each stage of the venture, which may typically even be extra worthwhile with out the entire danger. This enterprise provides Chauncey a novel view of the whole actual property investing ecosystem. At this time, she’s sharing the teachings she’s realized from this uncommon actual property perspective.
What’s happening all people? I’m Henry Washington. Oh yeah, and Dave’s right here too. What’s up, Dave?

Dave Meyer:
Don’t sound so disillusioned. I’m excited to be right here. That is going to be a enjoyable dialog with Chauncey at this time.

Henry Washington:
Sure, I’m tremendous excited too. And actually, there’s in all probability lots of actual property buyers on the market who’ve the talents and assets to do one thing like this and so they in all probability simply haven’t carried out it. At this time we’re speaking with Chauncey Pham, an investor within the Dallas market, and we’re speaking about constructing wealth by means of actual property ecosystems, not simply properties. Chauncey’s going to point out you ways to consider actual property as a enterprise with a number of income streams, how you can supply offers creatively with out counting on wholesalers, and which items of the method you can begin monetizing at this time, whether or not you’re flipping, shopping for leases, or doing some other technique. So let’s carry her on. Chauncey, welcome to the BiggerPockets Podcast.

Chauncey Pham:
Hello, thanks guys for having me on.

Henry Washington:
Let’s begin this off the identical manner we begin off each present. Why don’t you inform us a bit of bit about your background and what you had been doing previous to actual property?

Chauncey Pham:
So my background is hardcore one name shut sort gross sales. After which I find yourself transitioning right into a advertising position. I used to be an account government for a advertising agency the place I labored with lots of C-stores and trend chain, so BCBG, BB, Circle Ok. And I primarily was the liaison between their advertising departments and my firm who really created all of their level of buy advertising. And so it was actually, actually cool as a result of I realized the psychology behind advertising in that position. And whereas I had that job, my husband and I find yourself shopping for and promoting a few major residences. And our mortgage officer was like, “You’d be actually freaking good when you acquired your actual property license.” So I acquired my license, however I legit acquired my actual property license as a result of I needed us to go to Disney World and ball out with the VIP passes and go it.
That’s why I acquired my actual property license.

Dave Meyer:
So that you’re like, “If I promote one home, then I may go to Disney World.”

Chauncey Pham:
I can go to Disney World and fall out. And in order that’s why I acquired my license. However as a result of I had the gross sales background and the advertising background, inside three months of getting within the enterprise, I’d made my whole annual wage in commissions. And so I give up my job and it was off to the races from there.

Henry Washington:
So what 12 months was this whenever you acquired your license after which determined to do your precise first actual property deal?

Chauncey Pham:
So I acquired my actual property license in 2016. And I simply was a standard realtor from 2016 till I picked up my first funding deal in 2019. So after a 12 months of getting my brokerage, which by the best way, the basis phrase of brokerage is broke and that’s what the hell I used to be for the entire 12 months and a half at it as a result of realtors don’t promote something. 90% of them don’t promote nothing. And so I primarily then moved my brokerage, shut it down and went over to the nationwide brokerage that I’m with now and have become the highest recruiter throughout the first 12 months that I used to be there, introduced 400 brokers beneath me. And that first 12 months was earning profits off of all of their gross sales, which then allowed me to get out and begin investing. So I began doing that in 2019.

Dave Meyer:
Chauncey, we get this query rather a lot about changing into a dealer, actual property agent earlier than changing into an actual property investor or in tandem with changing into an actual property investor. So what’s your recommendation to people who find themselves contemplating that path?

Chauncey Pham:
I 100% attribute my successes and my mindset in being an investor to the truth that I used to be a realtor first.

Dave Meyer:
Actually?

Chauncey Pham:
100%. Fascinating. And I’d advocate to anybody that wishes to be an investor to a minimum of discover getting their actual property license, not in order that they’ll go and promote homes, however in order that they’ll perceive the fundamentals of the true property transaction from the buyer perspective. As a result of once I began flipping, I knew what it was wish to take a purchaser to see eight, 10 homes in a day, and on the finish of the day, ask them which one they wish to put a proposal on and the way 90% of them had been fully forgotten as a result of they had been all simply white, grey, similar ground, similar journey, similar end. It’s all the identical factor. They didn’t bear in mind any of them. And I knew what made them tick emotionally. So I at all times mentioned, if I begin flipping, I’ve acquired to discover a option to be strategic in making a product that’s going to be memorable for purchasers and be one thing that folks really hunt down.
And 100%, that’s what has set me aside from everybody else that’s in my market.

Henry Washington:
I don’t 100% agree with you on the getting your actual property license very first thing, however I completely perceive that perspective. And I like the angle of understanding each side of the transaction since you’re completely proper. Plenty of buyers, purely numbers targeted. The quantity of instances I’ve heard flippers say, simply get a spec sheet and flip the identical home to the identical spec sheets, similar colours, similar finishes, as a result of it’s higher for enterprise drives me up a wall. Each home we do is about what we expect the client in that neighborhood or that specific market desires, and that’s what’s going to assist your homes promote sooner. In order that perspective on why it’s best to get your actual property license, I believe is a fairly cool and distinctive perspective. And I agree with you. Buyers have to be taught extra about what your clients need. And positive, there’s in all probability some joyful medium between techniques processes and repeatability after which nonetheless having some type of individuality, however you’ve acquired to do it correctly.

Chauncey Pham:
Appropriate, right.

Henry Washington:
I’m assuming as you had been doing these actual property transactions as an agent, you had been like, “Hey, these buyers appear to be making some cash. How are they doing this? ” What made you determine I’m going to take the danger and do my very own actual property deal? As a result of it sounds such as you had been killing it as an agent, proper?

Chauncey Pham:
Yeah. So what made me form of pivot from simply being an agent to an investor is I had an investor consumer. He reached out to me. He had a flip that was in a neighborhood that I had bought fairly just a few listings and was like, “Hey, are you able to simply go and provides me some suggestions on this property? It’s been sitting in the marketplace and never getting any showings. Let me know. ” So I went, referred to as him the following day and I mentioned, “Right here’s my recommendation, right here’s what’s happening. ” He referred to as me then the following day and mentioned, “All proper, I’ve acquired excellent news and I acquired dangerous information.” The excellent news is I don’t need to take care of the realtor that had my home listed and the dangerous information is I don’t need to take care of her anymore as a result of I fired her. And when you don’t take my itemizing on, then I’m screwed as a result of all my cash’s on this home.
And so I took his itemizing on and I bought it the very subsequent week over asking. And from that time on, I turned his agent. So I helped him with acquisitions, I helped him on the consulting aspect. After which when his flips would go on they’re able to go in the marketplace, I really listed the properties. And I’d see each single time that we went to the closing desk, how a lot cash he was making versus what my fee was. And I additionally realized his course of. He didn’t have one. He didn’t have a duplicatable course of. He actually simply was like, luck. Offers had been falling into his lap after which he would get it and take it down. And once I would ask him, “What’s your means of getting these homes?” He had zero processes. And so for me, I mentioned, “If this man can do it and he’s making this cash, then I undoubtedly can create a duplicatable course of and system and plus all of those lips are form of ugly so I can do it and I can do it higher.” And so I really talked to my husband who was principally a C suite government and he was our breadwinner, proper?
I used to be making nice cash, however he has the insurance coverage, he acquired the job. And I’m like, “Babe, give up your job and be part of me in actual property and you may open our investing aspect.” And he was like, “All proper, guess.” And he did. Actually? And he did. That’s

Dave Meyer:
It.

Chauncey Pham:
Simply

Dave Meyer:
Like that?

Chauncey Pham:
Actually, it took him a few months.

Henry Washington:
He’s a gross sales professional.

Dave Meyer:
Do what to say to him. Yeah. He didn’t even realize it was coming. And he’s

Chauncey Pham:
A gross sales man too. So we at all times argue about who’s one of the best nearer. And I’m like, who’s one of the best nearer now? And so yeah, acquired him to give up the job and he began our funding firm in November of 2018. And January 2019, we had our first deal.

Henry Washington:
All proper, we’ve acquired to take a fast break, however once we come again, we’ll hear extra from Chauncey proper after this.

Dave Meyer:
As a number, the very last thing I wish to do or have time for is to play accountant and banker. However that’s what I used to be doing each weekend, flipping between a bunch of apps, financial institution statements, and receipts, making an attempt to type all of it by property and work out if I used to be really making any cash. Then I discovered Baselane and it takes all of that off my plate. It’s BiggerPocket’s official banking platform that routinely kinds my transactions, matches receipts, and reveals me my cashflow for each property. My tax prep is completed and my weekends are mine once more. Plus, I’m saving a ton of cash on banking charges and apps that I simply don’t want anymore. Get a $100 bonus whenever you join at this time at baselane.com/bp. BiggerPockets Professional members additionally get a free improve to Baselane Good that’s full of superior automations and options to avoid wasting you much more time.

Henry Washington:
All proper. We’re again with Chauncey Pham, speaking about vertically integrating your actual property enterprise. Let’s get again to it.

Dave Meyer:
So what

Henry Washington:
Did that first

Dave Meyer:
Deal appear like?

Chauncey Pham:
This specific property, we went out and walked it and lengthy story brief, we had been in a position to choose it up for $125,000. The girl simply needed sufficient to pay it off and have a bit of bit of cash to stroll away. We purchased it for 125. There was nothing flawed with the home. We had been going to place about 20 grand into it and promote it on the 215 mark, however as an alternative I threw it on the MLS in coming quickly and had an investor that was on the lookout for leases within the neighborhood, put it in for coming quickly at 192, went below contract, bought it two weeks later at 186 and did completely nothing to it. So it was principally a wholetal deal and I used to be in a position to take that 60,000 after which we simply form of stored rolling from there.

Dave Meyer:
Clearly that sounds unimaginable, Chauncey. Persons are in all probability questioning, is that potential? Is it potential anymore or is that form of deal a relic of a unique time out there?

Chauncey Pham:
I don’t assume that her state of affairs was distinctive. The way in which that we had been in a position to capitalize on that was she had beforehand had the home in the marketplace with a realtor and it had gone below contract.
And when it had gone below contract, the title firm popped up with a lien and it was a shopper debt lien. And so once we talked to her, she was like, “Final 12 months tried to promote my home, however this lien is on right here. When you guys can simply get this lien gone and simply get me this a lot cash in my pocket, you’ll be able to have the home.” And so I believe that what was distinctive about that state of affairs wasn’t essentially distinctive. It was the truth that we understood how you can resolve an issue. And so are these kinds of offers nonetheless on the market the place you simply have to be an issue solver? Sure. All day lengthy, that’s what all of them are. And I simply assume that far too many individuals are within the sport and so they’re not themselves as downside solvers, reasonably they’re stepping into with form of a one trick pony as a result of even once we went to her, it was not, “Let me simply purchase your own home.” It was, “I should purchase your own home.
I can listing your own home as a result of I’m a licensed realtor.” That’s another excuse it’s best to in all probability get your actual property license. I can renovate it in order for you after which take the price of the renovation, simply put a lien on it after which we are able to promote it in the marketplace, whichever resolution is greatest for you. And so I undoubtedly assume these offers are out right here.

Henry Washington:
Yeah, these offers undoubtedly exist. I’ve one below contract proper now that I believe we’re paying 180. It doesn’t want any work. We’re going to wash it up, throw it again in the marketplace for 250.

Chauncey Pham:
It’s

Henry Washington:
The state of affairs that’s inflicting us … It’s referred to as the girl is about to lose it in foreclosures, and so we’re going to purchase it. She’s going to make some cash as an alternative of simply lose it. After which we’re going to show it in. The home was constructed three years in the past. So it’s about on the lookout for conditions, proper? Appropriate. Chauncey, can we play a sport?

Chauncey Pham:
Yeah. I’m

Henry Washington:
Going to place your abilities to the take a look at.

Chauncey Pham:
Okay.

Henry Washington:
We’re going to position play. I’m going to be a vendor. I like that. So I stuffed out your web site. I’ve a home on 123 Predominant Avenue. You get the lead and also you’re calling me and I reply the telephone and what do we are saying? What can we do?

Chauncey Pham:
Hey there, Henley. How are you?

Henry Washington:
Oh, I’m doing nice. How about you?

Chauncey Pham:
I’m doing fairly good. Hey, you’re the proprietor, proper? Over at 123 Predominant Avenue?

Henry Washington:
Sure, I’m. Completely.

Chauncey Pham:
All proper, cool. Effectively, I acquired your info from my web site. It seems to be such as you want to promote this factor actually rapidly. So inform me this, earlier than we even get into the dialog, if I may wave a magic wand for you, get this factor bought precisely the best way that you simply wish to, how does this example play out in your head?

Henry Washington:
I’d like to get it bought and get it bought rapidly as a result of I actually need to unload this property in order that I can get the cash I want to maneuver on to my subsequent property.

Chauncey Pham:
Okay. So primary, how a lot cash do it’s good to transfer on to your subsequent property? And quantity two, why do it’s good to promote so urgently?

Henry Washington:
Yeah, I have to promote urgently as a result of I discovered a home that I actually wish to purchase and this one has an excessive amount of work that it wants for me to get carried out. So I simply want out.

Chauncey Pham:
Okay. So that you want out. And the way rapidly are you seeking to shut?

Henry Washington:
At the very least 30 days or much less. When you can go sooner, that’d be nice.

Chauncey Pham:
Okay, superior. And so then at that time, I’d sometimes do some kind of evaluation with them and begin pulling up the comps on the property. And at that time, I’d begin actually poking the bear on the ache. So I’d ask them to ship me any photos or presumably FaceTime me. Let’s do a fast video walkthrough of the property so then I can examine it to what’s in the marketplace. And this fashion, this will expedite me getting them a proposal. I don’t even want to return out to the home. FaceTime me actual fast, get me on Zoom. Let’s stroll by means of it proper now. I can get you a proposal proper now on the telephone. And I’m going to additionally, at that very same time, pull up another properties and have him pull it up and acknowledge the truth that his property is nowhere near these in order that once I include my low ass quantity, he’s not offended.
So Henry, you perceive your own home doesn’t appear like 124 Predominant Avenue that’s proper up the road. This one, look, this one has granite counter tops. We simply stroll by means of, yours has for Micah, and I’m going to have to exchange all of that, proper? You perceive that? And so I sometimes stroll them by means of all of that after which I’ll even usually ask them a query. So Henry, primarily based on these homes that I simply confirmed you, how a lot cash would you personally assume must be put into your own home to get it as much as that stage?

Henry Washington:
I like this query as a result of I do it on a regular basis. I’d say someplace between 25 and $30,000, which in vendor discuss means what to an investor.

Chauncey Pham:
Yeah. Now Henry, how are we going to get 25, $35,000 carried out on the … You assume I’m doing the work or I’m going to rent somebody? I’ve to rent somebody. There we go. In order that’s not going to work. Realistically, that is trying like about $100,000 that I’m going to need to put into it. So let’s again these numbers out. So that you wish to stroll away with X, Y, Z, and with the intention to do this, I must offer you this quantity. But when I assault $100,000 on prime of it, once I flip round to promote it, I don’t have any cash. So let’s work out one thing that’s truthful. Does that work? If I can resolve your downside and the timeframe that you simply want it solved, however I’m additionally fixing an issue for myself, let’s make some shake. And that’s sometimes the way it stage with them.

Henry Washington:
And that’s the investor standpoint. Now, whenever you make these provides, are you additionally providing them an answer the place you’re the agent?

Chauncey Pham:
Appropriate.

Henry Washington:
On the similar time?

Chauncey Pham:
So sometimes if they’re offended by the investor provide, look, you don’t get each on the similar time. You may’t be out of time and wish more cash. So if you wish to inform me proper now that you simply’re not out of time, then I’ve one other resolution for you. And that resolution is we are able to are available in. We are able to perhaps perform a little bit of labor on the property for you. I personal my very own development firm, so I can are available in, I can do the be just right for you. We are able to receives a commission on the again finish, so we are able to work out a deal that manner. I’ll listing it for you. I’ll management that a part of the transaction for you, ensure that your charges and all of which might be actually good on that finish. We’ll handle the development for you after which we get it bought and get you that increased quantity, but it surely’s going to take a bit of bit extra time.
So which one would you like? You need time, you need cash?

Henry Washington:
I like it. I like it. I do a model of the identical factor, however what you had been primarily doing whenever you requested me what I needed was you had been making an attempt to determine which resolution makes probably the most sense,

Chauncey Pham:
Proper? Appropriate.

Henry Washington:
When you’re saying it’s good to transfer rapidly, you then’re pondering as an investor. And when you’re saying, “I’ve on a regular basis on this planet and my home is in nice form,” then you’ve an possibility as an agent to listing that property. And I believe that that’s what buyers have to be taught is your job isn’t to signal your contract in your subsequent deal. Appropriate. Your job is to determine what does that vendor want, what do they actually need as a result of they’re clearly going to carry one thing again as a result of they assume that we’re right here to swindle them and get this greatest deal potential, proper? And they also’re holding these playing cards near the chest. However as you ask questions, you can begin to determine that out and you can begin to current an answer that truly works for them. And I believe what you’re saying is as a licensed agent, I now have extra choices to assist any person than any person who is just not a licensed agent as a result of all they’ll do is make a money provide or perhaps do one thing from a inventive financing side,

Chauncey Pham:
However they

Henry Washington:
Can’t listing a property and so they can’t do a few of these different issues. And so I do assume that licensed brokers have a superpower, however I don’t know that all of them know how you can use it. So you probably did your first flip. About what number of flips did you do in a given 12 months and for the way lengthy did that final?

Chauncey Pham:
So our first 12 months, 2019, we did precisely 10 flips. Wow. Yeah. So we did 10 our very first 12 months. In order that $60,000 form of gave us a bit of confidence and we constructed the little course of out after which we purchased our second property. After which after the second, we had the chance to choose up three extra. So we had been working 4 at a time proper after our first one. And so by June of that 12 months, as a result of we picked up our first in January, by June, we’d accomplished like 5 or 6. After which it form of stored snowballing from there till our highest 12 months, we did 21. Oh

Dave Meyer:
My God, that simply provides me a lot nervousness. I can’t even take into consideration that. Nevertheless it’s superior. I imply, it’s unimaginable. However are you able to inform us a bit of bit about them, Chauncey? How a lot had been these offers? What had been you paying for them? How had been you financing them? And the way massive of the renovation had been you doing since you had been doing a lot quantity?

Chauncey Pham:
After we first began, we had been shopping for within the excessive ones, low twos, after which we had been doing round $60,000 renovations and promoting within the mid threes to excessive threes. We continued to progress. And clearly right here within the Dallas-Fort Value area-

Henry Washington:
So did the costs.

Chauncey Pham:
I imply, that doesn’t exist anymore. And so now we’re buying just about all throughout the board, however I’d say that our candy spot is buying someplace within the threes, doing round $150,000 renovation and promoting in sevens, excessive sixes or sevens. Wow. One deal that I simply accomplished, we’re in a position to choose it up at 405. We did $190,000 or so renovation and it bought at 860.

Dave Meyer:
Wow, wonderful.

Henry Washington:
So these numbers, the unique numbers, the buying those, renovate for about 50 to 60, promoting the threes, that’s about what my market is now. And it looks like you’re targeted extra on the next worth level buy. Is that the identical dwelling that you simply had been shopping for when costs had been completely different or are you particularly on the lookout for the next finish sort of deal?

Chauncey Pham:
So our objective is just not essentially to purchase a home at a specific worth level. We at all times wish to search for homes which might be standouts, that when in the marketplace they’ve one thing cool or quirky about them. So whether or not it’s the format, it’s one thing architectural about them, it’s the lot, and it simply at all times tends to be round that worth level. However realistically, the specs of the houses that we’re shopping for proper now are about the identical as they had been once we first began again in 2019, the costs are simply a lot dearer.

Dave Meyer:
I like this method. I simply need to say, I believe I like the thought of on the lookout for one thing completely different. For my part although, there’s a half the place it goes too far, proper? How quirky are we speaking?

Chauncey Pham:
Nothing loopy, however I simply refuse to just do customary grey or white partitions with … I want one thing fascinating. We go for giant skylights, cool entrances, humorous layouts. We do lots of sunken dwelling rooms, rather a lot of-

Dave Meyer:
Very 70s,

Chauncey Pham:
Yeah. Sure, sure. And we preserve these components the place most flippers would go in and doubtless attempt to make the whole lot appear like the whole lot else in the marketplace. We discover the homes with previous character and we attempt to protect it.

Dave Meyer:
I assume it limits a bit of bit who you promote to, however are these folks extra then? Such as you get people who find themselves actually passionate in regards to the houses as a result of there’s one thing that they get hooked up to.

Chauncey Pham:
Sure, right. So primarily my advertising background, even simply doing advertising on-line will let you know that your job as a marketer is to create a proposal that’s so irresistible that the buyer can’t not purchase. They really feel silly for not shopping for it and to nearly create raving followers to your product. And that’s form of the method that we take. And so yeah, we’re usually getting a number of provides, however we’re not getting 15. We could get three or 4, however these three or 4 those who need the home and the one which in the end finally ends up going below contract will do something to ensure that they keep below contract as a result of they know they’ll’t discover one other product like ours.

Dave Meyer:
A lot great things right here from Chauncey, however we’ve acquired to take a fast break. We’ll be proper again. Welcome again to the BiggerPockets podcast. Let’s bounce again in with Chauncey Fan. So that you’ve talked rather a lot about flipping, however have you ever ever considered doing rental properties or some other methods alongside flipping?

Chauncey Pham:
Yeah. Yeah. We’ve got some leases out in East Texas. So we’ve a portfolio of 17 leases in East Texas. However what I discovered right here in Texas is that it’s very troublesome to money move something within the Dallas-Fort Value market, just because taxes and insurance coverage is so costly on prime of the acquisition prices. So the market that we’re in is like Texarkana, Tyler, Longview. I’m really from Texarkana. So that you’re in a position to purchase properties there for actually low-cost. Lots of people lease without end there and also you’ll get good money move, 500, $700 a month. However the issue is the worth of these homes, they don’t enhance. So that you’re money flowing, however when you go to promote it 10 years later, you’re fortunate if the worth has gone up $20,000 or so. So I’m probably not hardcore within the constructing of leases. We actually wish to leverage doing issues that get us lots of capital in hand after which taking that and form of investing in different shops.

Henry Washington:
So it sounds such as you used your market experience as an agent to know the place I should purchase for money move and the place I should purchase to extend my return so that you could strategically purchase rental properties, but it surely sounds just like the flipping enterprise is what’s actually producing the revenue, however the market modified, the value factors shifted and which means danger shifted. Is there the rest that you simply did do or have carried out that can assist you mitigate the danger and the change of the market that has occurred over the 2025, 2026 market? As a result of lots of people fell on their face in 2025. So how are you staying worthwhile?

Chauncey Pham:
Completely. So actually enthusiastic about this new form of mannequin that we constructed out and it’s our turnkey mannequin the place we primarily are operators. So as an alternative of stepping into and really proudly owning the properties, we’ve purchasers which might be liquid, sometimes a minimum of $150,000 or so, and they’re concerned about getting a return on their cash by means of flipping, however they don’t have something apart from the cash. And as an alternative of doing what a typical flipper would do, which is take their cash after which go and purchase a flip after which give them a set return on it, as an alternative we’ve constructed out the entire verticals round flipping homes. So that you’ve acquired to seek out it, you bought to fund it, you bought to repair it, you bought to furnish it, and you then acquired to flip it, proper? So I personal all of these components of the transaction. So we’re sourcing the offers, we’re the lender, we dealer out cash after which we’ve our personal business line of credit score that we mortgage out.
We personal the development firm. I’ve the staging stock due to the true property brokerage that I went to, I’ve a whole bunch of brokers beneath me, so we’re itemizing the property. So primarily we’re in a position to go to our purchasers and say, “Hey, I’ve acquired this home, I’ve acquired it for, you’ll be able to choose it up for $200,000. Right here’s the scope of labor. It’s going to value roughly X, Y, Z.” It’s correct as a result of I personal that a part of the method. Right here’s the design, right here’s the whole lot that has to do with it. Right here’s the typical days on market, right here’s the ARV, and so your potential revenue when it sells shall be X, Y, Z. Do you wish to take it down or not? And in that case, then we begin that course of and I’m earning profits in each single one of many steps of that course of that that individual would’ve in any other case needed to gone out, discover a home, get a lender, discover a GC, rent a designer, rent a staging firm, discover a realtor.
I’m all of these issues for them. And I’m in a position to make six figures on every take care of zero cash out of my pocket. And so I’m leveraging my skillset in home flipping to have now turn out to be an operator and constructed out a extremely worthwhile enterprise with out me having to technically personal the asset.

Dave Meyer:
I imply, that sounds unimaginable. Each out of your perspective, but in addition from a flipper, when you’re not knowledgeable at this, it sounds such as you’re providing rather a lot. However when you’re making six figures, what are the margins for the flipper?

Chauncey Pham:
It relies upon, however I imply, they’re sometimes making 20%, 25%, someplace in there.

Dave Meyer:
Okay. However are they working the venture? Are they doing-

Chauncey Pham:
No, they do nothing. They’re fully palms off. They

Dave Meyer:
Do nothing.

Chauncey Pham:
They do nothing.

Dave Meyer:
Okay.

Chauncey Pham:
They do completely nothing apart from signal on the dotted line and purchase the property and signal when it closes.

Henry Washington:
So that you’re not apprehensive about earning profits because the investor, you’re apprehensive about your corporations earning profits all alongside the best way? Is that …

Chauncey Pham:
Appropriate. Appropriate.

Henry Washington:
Okay. So stroll me by means of what that appears like from an investor’s standpoint. So what’s a typical deal appear like for you because the enterprise house owners and the investor?

Chauncey Pham:
All of them look completely different as a result of I personal the completely different items of the method. There’s no set price for every half, if that is sensible. Okay. So some homes, if I’m in a position to purchase it actually low, then I can entrance load it and I can make more cash on the acquisition. So if I’m in a position to purchase a property that’s price 350,000 for 85,000, then clearly I can offload that to my consumer at perhaps a 150. So now I’ve made an enormous chunk on the entrance finish, proper? Versus a home that I’m not essentially buying actually, actually low, however I do know it has in depth development, then I can in the end construction the deal the place I’m making more cash on the development aspect or within the design. So there’s no set numbers. We underwrite them otherwise. Each single home is totally completely different, however our objective is to ensure that our turnkey purchasers are coming again.
So our objective is to ensure that they’re earning profits. And so I’m going to construction the deal in a manner that each time they’re getting more cash than they’d in some other manner in placing their cash out there in any manner. And so so long as I can do this and so they’re not doing something and so they can name themselves a home flipper, they get the ego of having the ability to say, I’m an investor with being palms off, however then getting a 20, 25, generally as much as 35% return on it, then they’re joyful as clams.

Dave Meyer:
I’m simply making an attempt to know the danger reward profile right here

Chauncey Pham:
As a result of

Dave Meyer:
It’s like different turnkey properties, proper? Usually, when you go and purchase a turnkey rental property, you’re giving up a few of your upside to decrease your total danger.

Chauncey Pham:
And

Dave Meyer:
That’s form of what this looks like. You’re giving up a few of your upside in a flip to decrease your total danger. So I’m simply making an attempt to know what the dangers are for the flipper. They’re proudly owning the property, they’re nonetheless responsible for value overruns. So these are vital issues for individuals who would contemplate this mannequin.

Chauncey Pham:
Yeah, completely. However the associated fee overruns aren’t the … We went over and also you simply need to pay it. It’s, it is a choice that as an actual property investor, it’s good to make. And in the end, once we are underwriting these properties, we’re extraordinarily conservative with our numbers. So we’re calculating the whole lot as if the whole lot has to get mounted. We’re speaking the entire MEPs, the whole lot beauty. So if there occurs to be an overrun, then that’s sometimes as a result of we’ve seen some kind of upside. So the home throughout the road simply went in the marketplace and it has an additional bed room and we’ve the chance to transform an area right here to a bed room if you wish to obtain that quantity. So then at that time you get to make that call. It’s not simply an arbitrary, “Sorry, we went over. You bought to pay this more money in development.” It’s not that sort of factor.
In order that they get what the complete scope of labor is earlier than they even make the choice to accumulate the property and so they know what all of that appears like.

Henry Washington:
And it sounds humorous, however such as you mentioned, I’m making greater than them, however you’re making greater than them throughout a number of completely different Totally different companies. Appropriate. And that is all cash that an investor pays to different corporations anyway. Yeah, we’ll be being paid anyway. That is what I do anyway. All people at all times makes more cash than me. It’s simply what I get to stroll away on the finish of the day. I pay my contractors, I pay the title corporations, I pay the true property brokers, I pay the venture managers, after which I get to maintain what’s left. The method doesn’t change. It’s simply that on this specific area of interest, on this specific market, you personal all these companies. So that you’re mitigating your danger by taking your revenue margins by means of your corporations and never having to personal the true property asset, and also you’re nonetheless earning profits flipping homes. You’re simply not the one proudly owning the asset and also you get to supply primarily a turnkey product to your vendor.
That’s a fairly cool perspective. Vertical integration is, I believe, vital to most companies, but it surely’s an intimidating factor to tackle. How did you are taking that chunk of the elephant to the place you began to personal completely different components of the method that weren’t the everyday purchase the home, renovate the home?

Chauncey Pham:
Yeah. So it really began with this mastermind that I’d gone to for actual property, and so they had us do that train the place we wrote the phrase realtor within the center, circled it, after which we needed to provide you with who all in a transaction made cash. And on the finish of the day, I believe we got here up with 45 completely different folks in an actual property transaction, generate profits from one thing out of realtor rinks. So then once we discovered ourselves on a tv present, flipping homes and getting increasingly more demand for needing to get extra homes, we had been like, “Man, I don’t actually wish to purchase extra homes. How can we leverage what we all know? How can we … ” And I simply had this thought and I advised my husband, I’m like, “We did this train once I was a realtor. Let’s see the entire completely different components of flipping a home, how many individuals are earning profits off of that?
” And as an alternative of us going out and at all times shopping for extra homes, why can’t we simply leverage our skillset on this and leverage our experience and generate profits off of the entire completely different components? As a result of in the end that’s what folks have probably the most issues with is implementation. So if I can implement issues for those who I’ve already turn out to be an professional at and I can simply generate profits, then that’s how I’ll do it. So it actually was form of born from, once more, this concept that I realized being a realtor after which out of necessity of simply persevering with to wish to purchase extra homes on the tv present. And proper on the tail finish of that, and I’m like, I’m uninterested in having to purchase extra homes. We completed and wrapped manufacturing with the present and we had been like, let’s do this turnkey factor. Sufficient folks now know us.
We’ve got the credibility. We’ve got the processes constructed out. And so then we simply began doing what we had been already doing. So then it was fairly easy. We had been already sourcing offers. So we simply made {that a} legit course of. We already understood onerous cash lending. So then we checked out what it will take to get a line of credit score that we may mortgage out and dealer for different onerous cash lenders. We already had our personal development firm, in order that was already set in stone. However then we acquired our tax resale certificates after which we arrange accounts with the entire wholesale suppliers for the supplies. We then purchased the staging stock and set that enterprise up. So it was issues that we had been already doing. I believe you begin to get into the weeds with vertical integration whenever you’re making an attempt to reinvent the wheel as an alternative of what you’re already doing, who you’re paying cash to, after which seeing how one can form of carry that in- home, which is in the end what we did.

Dave Meyer:
It makes whole sense. I imply, this cash goes out. You may as nicely get a few of it if in case you have the capability to do it. It’s spectacular, tremendous spectacular that you simply’re in a position to run all these companies. Did you begin all of them? Did you purchase them or is all this from scratch?

Chauncey Pham:
No, we began.

Dave Meyer:
Wow, that’s

Chauncey Pham:
Superior. We began all of them from scratch.

Dave Meyer:
Very cool.

Chauncey Pham:
Simply one after the other. They usually’re not working independently. I’m not advertising all of them. So it doesn’t appear daunting.

Dave Meyer:
Yeah. It’s not such as you’re doing staging for another person. You do it for your self. Yeah. Proper. Yeah. Okay. Yeah. That makes whole sense. So that you’re advertising turnkey after which the whole lot else flows from there.

Chauncey Pham:
Appropriate.

Dave Meyer:
That is sensible.

Chauncey Pham:
And infrequently we get the one-offs the place somebody simply desires a retail development job, we’ll take it. I do design jobs for different folks, however that’s not my focus and that’s not what I market, however I do have the power to do this. In order the market modifications, I’m within the place to generate profits in a ton of various methods when different folks aren’t.

Henry Washington:
Effectively, I commend you, you’re braver than me as a result of the quantity of instances I’ve thought, man, I ought to simply begin my very own development firm as a result of I’m working all these crews anyway and simply haven’t pulled the set off to do it. You might be my inspiration that that is completely potential, Harry. Particularly with the extent of experience- Completely

Chauncey Pham:
Doable, dude. It’s so doable. It truly is.

Henry Washington:
All proper, Chauncey, thanks a lot for approaching the BiggerPockets Podcast and sharing a literal wealth of expertise. I want we had extra time to have the ability to dive into the entire issues that you’ve skilled and have expertise in in the true property world. Thanks a lot.

Chauncey Pham:
Thanks for having me guys.

Dave Meyer:
Thanks, Chauncey.

Henry Washington:
Additionally, guys, when you realized one thing from this episode, then I like to recommend you testing BiggerPockets Podcast, episode 1160 that’s again from August 2025, the place Dave and I each shared a few of our favourite low-cost and simple strategies for sourcing nice offers. Thanks a lot all people for listening to this episode of the BiggerPockets Podcast. We’ll see you on the following episode.