You're looking for your first real estate deal in 2024. This episode covers the top five ways to go and do that. My name is David Leko and this is an episode where I was interviewed by the great Chicago Investor podcast hosts on how they're real estate investing with deal machine and my recommendation for new people, just picking up the app, looking for a rundown house, how they can approach finding that very first deal that's going to allow them to make $10,000 or passing that off to an investor who wants to pay cash for it. We're excited to have you, man. I'm a two months in the deal machine. I'm loving it. Oh, okay. Good. So I'm in. That's just on my first batch of 700 postcards. Oh, cool. That's a good batch. Yeah. So we, uh, so far, so good. I've, I've been able to stop using prop stream. I've been, uh, very happy with it. Got it. What was the biggest reason why you switch? The, the biggest thing was I was already kind of sorry, I'm just fixing my care while I talk here. Um, I was already, when I went to my properties throughout the day, like driving for dollars and, you know, looking for things along those lines, um, this was just one, two in one spot right? Cause I had, I had this source product. Like I was doing all the scrubbing. I was paying it to the scrubbing like this was just all in one spot. Like what you guys charge is much better than all of like the, it's easier and it's more economical than everything else that was there. Well, we're glad to hear it's easier too. I mean, we put a lot of effort in trying to make it simple. So that's good. Then, and also just the, I, I haven't, like I said, I'm news. I'm new to your products. So I'm just sitting on my first batch here, but it's like sending the, the postcard with the picture on there. I gotta feel it's, it's gotta give me more of a response rate that I've done in the past. Not using deal machine. Yeah. Absolutely. That's why we put it on there. Call me and say, well, you know, I put, I got a lot of mail, but it looks like yours. You put a lot of effort into it. You know, or I could tell you're actually there at my house or, Oh, I didn't know my house looked like that before jumping in. You've had a very interesting career. I want to hit on you are a race, a race or enthusiastic man, like I went on your social media. You were all over the place there. How? How did you end up that way? Like where? Where did that start? Like that's, that's intriguing to me. Thanks, man. First got an interest in racing in 2019 is because my friend Gary, he invited me to drive a $500 car for 24 hours with him and three other guys at Gingerman Raceway in Michigan. So I had no previous experience, but I liked trying new things. I was like, hell yes. And I was feeling pretty stressed at the time, like totally separate because, you know, some things in my business, it went from very profitable high growth to me hiring 20 people and then having zero profits. And we had like a slight shrink in revenue. So I was kind of losing sleep and just all social interests and was working around the clock to solve the problem. But when I got to that race, the first time I drove the car was actually during the race. And I was the second driver of the rotation, right? So the race was already going on. So I'm getting like belted in, but they're so uncomfortable. They're like set up for somebody who's a foot shorter than me. And I'm like, dude, I cannot drive the car like this. And he just slammed the door. He was like, go slow, have fun. So I like drove out of the pits and it just took like all of my mental capacity. There's very few things that like don't allow you to focus on anything else, but like driving a car like that that's very uncomfortable does that to you. You can't think about anything else because you're like, I don't want to go off the track. I don't want anyone else to hit me. Why do all these other cars smell funny? So I was waiting, you know, for another lemon's race because that felt so refreshing. So I was after that, I was like, hey, Gary, do you want to do this again? But a year went by and nothing, right? So, you know, thankfully my business corrected course. I was able to like do a three day racing school in Austin, just kind of take things into my own hands because I was so addicted to that feeling. And then I ultimately ended up moving to Austin. He's like so warm. So I'm not from Chicago, but I'm from St. Louis and I lived in Indianapolis. So I'm from the region, if you will, association. The region is in Gary, Indiana, but like the greater region. But yeah, so once I got to Austin, there's like a local track, they had 18 races. And so like, that's where I really started to learn, right? Like I was terrible, but halfway through the season, actually won a race. Like that was crazy. I couldn't believe it myself. And it just felt good to like see yourself getting better itself. So this past year, I wanted to take the next step. So I found this car that's like like a Miata on steroids. Right? It's, it doesn't have like traction control in nanny. So you, you, you also don't have too much power. So you have to like truly develop skill to be the fastest one. You can't just stomp on the gas to get speed. You got to keep that momentum. And so that's where I'm at right now is like, I'm, I'm pursuing just building that skill and striking while the inspiration is there because inspiration goes away. It's like, if I don't do this while I'm feeling it, then I might never do it and regret it. So I'm, I'm like all in and doing like 55 races this year. So I love it. It's been great. Man. Congrats. That is awesome. And I love just hearing the passion. So that is, that is absolutely awesome. So let's talk a little about starting deal machine. We're going to break down. I want to talk about deal machine that we want to talk about these lifts, right? Cause that's what everyone's going after. Where did you get the idea? I know you, it looks like you had a consulting experience before this. You had some IT experience. Where did the idea come to? Hey, let's make an app here. That is super easy for investors to go solicit off market deals. Like where, where's the genesis of this? Well, actually it was to solve my own problem. I was working a regular nine to five job and I was like working a lot cause I thought every hour I spend now is just more knowledge that I can exploit later, right? Just kind of, I thought like the more money I can save now, the more I will have invested later. So I've always just trying to be like a delayed gratification person, but I was like working 60 hours a week and I was like, all right, I think I've like kind of reached my wit's end here and I'm going to go ask the founder of this company, which is like a 20 person company. I was like, why do you invest in rental? Oh, properties, you know, instead of stuff, like I haven't played subs flow. If you have retired by the time you're 40, which was his goal, I mean, you could just calculate it. It's 15 houses to have this much cash flow to provide for my income. I was like, Oh man, I mean, because he was like, you're stocked by one up and down, haven't they? And I was like, yeah, they did. And so I started looking for a deal. I couldn't find one. So then I went to a meetup and I heard you should go look for rundown properties. So I was doing that like three or four months go by and I see a house. I'm pretty sure I wrote down previously, but this time there's a construction worker with a ladder and a paintbrush and I go home and look it up and sure enough, somebody just bought it. And I was pulling my hair out because that was my deal. But I was like, well, I didn't actually reach out yet. So it's probably my bad. And so I started writing letters and it just took so long that the very next weekend, I was like, I'm going to use like some of the, I've gotten some basic, you know, computer knowledge skills. I'm going to make like an app with a map where you could pin the house and tells me who owns it from the county record and prints it. So that I don't have to do this crazy amount of like handwriting and it was, you know, just a time consuming process. So it ended up that like a lot of people, the common advice, even still is like go drive for dollars. That's what it means when you say like, go look for these rundown houses. And so ultimately somebody at the meetup wanted to use this thing I created for myself. So I put it on the app store, gave it a name and the rest is kind of history. I didn't know I was creating something for investors. I was truly just trying to get my first deal myself, which I did. But thankfully, you know, it gets, we've been able to serve and help a lot of investors since then. And obviously the tool does more now than, than just the driving for dollars. I would say probably, probably now the most valuable thing people come to is the data, especially like the unlimited contact info that we added. So it's been a five, seven year journey. Yeah. So in weekie, we're, we're here to talk about this list, but before diving in, like, you know, I am full disclosure, like new deal, machine client. That's how this all came about. I was talking about how awesome your product was to Eric, working with Renova when he goes, dude, I know the owner, like you get them on the podcast, you know, Renova was close with them. So right. That's how this all came together. Yes. I did. I started using Renova this year and had even known them previously. So shout out to them for having a great like DSCR loan product for rental properties. Yeah. Absolutely. And for our listeners, check it out, reach out to me directly. If you have interest, like I'm just starting with this, just starting to the first campaigns and it's been, it's been, it's been a fantastic user interface. There's so much the tool can do. It's so easy when you're just going from job site to job site to pick up new leads. I've gone from having to have a VA and just paying props for him, paying list source, all this. And it's all now with one spot for me. So huge. I'm in the honeymoon stage here and very happy about it. So this, this, the iron is hot right now. So if you want to talk about it, feel free to reach out. So David, we won't, we won't turn this into a complete commercial for you. So let's, let's jump into this list, these lists here. So you have just oven years of experience with deal machine, your own personal experience before that you had a ton of data on just the different list that should be targeted for, is this for finding distress houses for, is that the right term here or what are, where is, what are, what are we looking for? Yeah. I mean, we're looking for good deals. Some of my deals that I've done have been a full burr. So buy rent, renovate, refinance, repeat, basically, if you have a W two job and you want to invest in a rental property, you make one down payment, you maybe make a second down payment and then you're like, well, now what, cause you ran out of money to buy rental properties. So the way around that is to find such a good deal that you can renovate it and then refinance it for way more than what you put into it. So that, that's, that's called a burr. And so that's what I started doing because I was, I had a W two income and was not unlimited in cash. So I've got 19 rental properties. My goal is 20. Most of them have been burr deals. So anyway, with that experience, we want to find good deals. A lot of people who use deal machine, they're looking for good deals to wholesale because maybe they are ready for like doing a full renovation yet, but they want to build their real estate skills and also, you know, build up some cash that they can make for finding a good deal to getting in their contract and passing it off to an investor like yourself or me. So basically, I'm a good person to listen to for what are these top motivated sellers? Like, who, who are these people that want to sell their house at a discount? So we, we call them lists. So I, I would call this like the top 25 motivated seller lists that you could reach out to. So, you know, before diving into the 25 lists, I hope you guys can, you know, comment on your own experience. I'd find that interesting. I'm sure others would too. But I do have, I am coming with a little bit of structure here. So my main point before diving into the list is like, man, it's so easy to hear there's 25 ways I could do this and then, and trying all of them and then nothing works because you really didn't give any one of them a really good try, you know, so let's tackle one thing at a time so we could focus on getting results before adding more types of thing to your plate. So we've got these listed out as like, if you're starting out, whether you have money or not, you know, I recommend the first part of this list to generate proof of concept, generate some income before getting a little bit more advanced. So the first is driving for dollars, we already covered that's when you look for a rundown house. The reason why that's so good is because you can't buy that list. It's not easy to get. You've got to invest time in making that list. And then going to the property is the best way to figure out the condition of the house. So those two things together mean that you'll find, you know, houses that aren't talking to other investors, right? See, they are getting tons of mail from other investors. So you could buy it at a deeper discount when they're talking with you. The next one I just had a great deal from is called tax delinquent. So there's like seven, see, in a hundred tax link, the property is in Indianapolis in 20, I called me, he had a property that he was behind on taxes, obviously, because I mailed him, he bought it for 182 years ago. I could only buy it for 160. He actually brought 20 grand to the table and paid the taxes to let me take this property off his plate. Now he said he had a few other properties. And I said, Hey, dude, I know you bought these out of state. He was orthodontist in Utah, making a lot of money. So these kind of became a headache for him because his guy who was advising him on the construction kind of went MIA, right? So just as a thank you for doing all that, I let him, insured him to my contractor. And so I know they did deal together. And so I think that was a good win-win, but just finished the project myself should be doing the full burr on that one as well. So the next like four, and then it sounded like you had something to say. So I'm going to throw it back to you is there's like another thing called leans. And so leans are just like tax delinquent. If somebody's not paying their taxes, there's something kind of wrong there. Maybe they're out of money. Maybe they're having an headache like my orthodontist friend. So some of the specific leans you can look up is like a mechanics lean. That means like if a builder contract your subcontractor did work, but the owner didn't pay property. Got to pay the mechanic as part of the proceeds first to make him whole. So again, if they're not paying, I think something's wrong. A judgment lean federal tax lean and it pay their federal taxes or homeowners association lean or other things other good things to look at again, because they're not paying. And then side, can you these things you can look up in deal machine, right? Because I know there's even more we just probably like a hundred leans, but these are kind of like the core ones I feel like. Yeah. And is this something you can just look up, you know, let's say, great, I'm interested. I want to look up who's got judgments, who's got different leans. Where would you recommend that person going? Yeah. Oh, it's in deal machine. You can click on single family home filter up at the top and then there's like more. So you hit the more. That's like your advanced filtering. And then you could open up leans and see there's like a hundred types of leans. So yeah. So you have any app for someone who doesn't have the app, they can look it up, you know, it's the county website, the record is like, there's a lot of different ways to get those one offs. Oh, yeah. Yeah. You're right. So most counties do have this online as well that you could pull. So that's why everything I just told you is a free list. So sorry. I didn't realize that's where you're going. Yeah. Like everything I've talked about so far, you can get for free basically. You can also get it in deal machine. We got a seven day free trial, but it's free. You don't need it. You don't need the deal machine out to get these. Yeah. So it's, it's curated in one spot for you though. And then you could also parlay it with driving for dollars, you can see physical distress and they have a lean or whatever it may be. Right. So the tough part about the county websites is they don't seem to be very friendly. And now I think that's our purpose, but just my personal opinion, for example, the tax delinquent list actually pulled that straight from my county and it comes on like a PDF. And so the PDF is in like a formatted table that you can't like copy and paste it into an Excel sheet, you know, it's like, it was quite difficult actually. So that's what I mean is like that it's in deal machine. So you can quickly just click it and then be like, send mail to this list. Yeah. Cool. All right. Let's keep rolling. What else we got? I was list. Yeah. Yeah. We're at seven now. So now we've got a few code violations. I wanted to tell you about. Like somebody has their grass growing really tall. That means like the, the tenants not in there to cut the grass or the tenants not doing what they're supposed to cut the grass or there's just something else going on. So the city will cut it to keep it safe for everyone else in the neighborhood. That way there's no snakes and bugs. And now the city chart is a lot, they didn't charge like 400 bucks per grass cut, you know. So those bills and they can add up. And so if somebody's ignoring that, there might be a reason why they just want to get rid of the property. The next code violation is like work without a permit. So a lot of people from out of sale do their first house flip hire a contractor that doesn't do things the right way. And then once that thing gets flagged as work without a permit, they have to stop. And so we know if, if most investors are using some kind of hard money loan, though, the longer you hold that property, the profits like shrink away because your holding costs on that loan build up, right? So good one to alleviate a pain point there is if they've gotten flagged and they have a code violation for work without a permit. Number nine is trash and debris, again, it just means their contractor's not like keeping it up with things and something could be wrong. So again, those are free tennis pre foreclosures. My tip is that in some states like, well, so in Illinois, your foreclosure process is probably a little bit slower, I would guess, than in Texas, where it's only 30 days. But the list is like 20 times slower. Yeah. If you're in Chicago and somebody shows up on pre foreclosure, of course, they could save their credit by selling the house to pay off the loan. But the most important thing is, I think, giving people peace of mind where they know where they are going to lay their head. And they can do that by getting rid of this problem, selling it to you, getting rid of this pre foreclosure process, and using any proceeds from that to go into a place they can afford, a can afford. So I would do what's called reverse driving for dollars for that list. You could put it in deal machine or map quest or whatever, Google Maps, and drive to the house and then go knock on their door. And so deal machine as a feature where it can route you to all these in the most efficient way. So that's what I mean. There's other apps that can do that too, but that's how I would handle the pre foreclosure list. And then 11 be pre probates, like the owner has died and there's no will. So a lot of times, people need direction on how does this get handled? What are the next steps? And you could provide that guidance as a real estate investor and potentially be the person who buys it. 12 is for sale by owners. 13 is the eviction list. I just pulled this in Indianapolis, so it's funny. I mean, I've never had an eviction as a landlord knock on wood, but I assume it would be very frustrating. And so I thought if we were trying to solve pain points, this has to be a list that's that's useful. So to get the list was hard. This is not a deal machine. You can get it for free, but I actually paid $400 for it. I went to Indianapolis like courts and I applied and there was like a lengthy document that was like, well, why do you need this? Why does this help the city and all this stuff? So basically, I just filled it out. There was an option is like, are you willing to pay or are you asking for this for free? And I was like, I'm willing to pay just because I wanted the list. And I felt like that would give me better chances of getting it. So I just sent out my first round of postcards like a couple of days ago. So I'm excited to check that out. Morgan said, is there any way to find this in Chicago? Maybe a golden list. I think so. Yeah. I mean, the court record had it all public. So court records are public. The only reason I couldn't get it online is because they only let you view it one at a time. So I couldn't like get a whole list. You know, I could look at all the records, but just one at a time. So I needed a bulk data download. Yeah. I wrote poll eviction list as a note, like that's even for the property manager side. That's a good one. You hit them with everything you did wrong, at least thing. Yeah. Well, I actually did a whole episode on the deal machine real estate investing podcast on how I filled out that form. Let's see which episode is it? But yeah, that was definitely like a really cool one. It's 125 episode 125 for anyone wants to check that out. So if I was going to relate to that, the show does. Oh, cool. Yeah. It's called our eviction properties. And most of this kind of real estate. Well, that's attention grab it. 14 was like water shut offs. So those are like really tough. I could not get those in Indianapolis, but I have seen tons of like real estate investor content about them. So I dug a little deeper. They actually will show up in like the liens that we talked about previously, right? I was like contacting the utility company and they're like, no, we're not giving you this list, but they show up as liens, right? Cause if the utility does not get paid, they, they will put a lean on the property. So you just have to figure out in your county what type of lean that's called. It's not going to say water shut off, but it'll say like utility, utility lean perhaps or something like that deal with she listeners. I'm wearing my turtle neck, not cause it's Steve jobs birthday, not because Apple just announced they're integrating AI into their phones. Nope. None of that. Coming up on deal machine unveiled, which is our special live presentation where we're unveiling the latest innovation in real estate technology. Last November, we had an unveiled event and we broke down the house with unlimited skip tracing, which also improved with our private investigator tool. The accuracy of your skip tracing results by 50%, meaning if you don't get data, you can actually see every person with that homeowner's name all in one spot in one place. There's no other place you can get that. So come July 1st, reserve your spot, get notified, be among the first to see what's coming next for the real estate industry, the URL, by the way, is deal machine.com/unveiled 15. Now we're getting deep into the free list. Okay. So if you're like brand new, I would, I don't know if I'd start with 15, but this is the arrest records. Right. So you should, it's like, hey, they still have bills to pay even though they're in jail. So they're probably not working either. So that's where it comes into play where you can maybe help somebody like that, who has that rundown house or a house in general that they can't pay for. 16 is 100 day old listings on market. I have had a ton of success with this in the last nine months that I'm pretty excited to tell you guys about actually. So I wouldn't recommend this necessarily as like a brand new investor. So what I did was I have an agent and I hooked her up with a software. It's called zoom offers now. I know the guy Caleb who owns it, but I don't have any type of relation to him, but I'm a user. It's like connects her email and then connects to the MLS and allows me to filter 100 day old listings. And then I can select the ones I'm interested in. And then there's a slider for what percentage of the perfect purchase price to I want to offer. So I would slide it to 70% and then it auto fills out DocuSigns just like my agent would through DocuSign and then emails it to the listing agent from my agent essentially with all the signatures and the right price filled out like in bulk. So I made 500 offers like this last year and I did six deals and so one was even $100,000. So it was very, very, very successful. But not all of them, if you try this, they don't like typically take it up on it right away. They'd sell the market for like two more months and then they'd come back and be like, Hey, is that so good? Does that offer so good? And then you also have to have an agent that's cool because some people get mad when you send 70% offers and the communication goes to my agent, right? So that was, we, and we worked through me not sending it random time. So me coordinating with my agent, okay, David, when are you going to send these? So I'm ready to reply. So we worked out those kinks and that was very, very good. So I really enjoyed that. And then 17 houses listed for rent again, I just, I don't know if that's as effective, but if they've been sitting on the market for rent for a while, like that's another indicator that somebody might just want to sell it. And then last one of the free lists 18 for closure. So it's, if it's going to be auctioned, you know, you need a cashier's check. So it's last on the free list because if you're brand new, I don't know if you want to walk in with like, you know, multiple cashier's checks of a hundred grand and stuff to bid on properties. But the auctions don't seem to be too crowded these days compared to like in the past. So yeah, before I go to the paid list, I just wanted to see like, what do you think was the most interesting that you guys heard or maybe from your experience that you've had success with on the free list? So I'll speak first, Mark, like a couple. So the 100 day listing, I love that one, right? There's so many deals I've gotten where I've in second position and they come back around saying, Hey, man, is that still out here? Right? And you know, you know, you always got a panic and go run your numbers like, I don't remember this at all. It was 90 days ago. So staying on those ones. And I still like, I don't have the time to like intentionally drive for dollars every single day, but I just do it going from job to job. And we've gotten some of our best deals that way, right? Just calling up, you know, you see the forend side saying, Hey, I'm not looking to rent. I'm actually looking to purchase this. Would you have any interest in selling? In most people, at least have some sort of dialogue, right? You do that a couple hundred times. Just like you mentioned, you said 500 of these offers out, you're going to get five or six of them. That's just, it's just a pure numbers game. It's a grind. You just got to be willing to do it and follow through on it, like, no, this is magic, right? Like none of this is, you know, oh my God, like, but it's just following through on that. Like you will get deals out of it if you're willing to put in the effort. Well, I think I'd like the, the official list because man, you are at people's low of this lowest feeling when they have somebody that's that they maybe try to work a deal out with three months and then they finally send it to court and now they realize they still got six months ahead and this tennis, I call it back and they think the house can destroy it. Like, that's the opportunity, especially if you enjoy getting tenants out. So if you, for the fiction list, I think about like, hey, listen, we'll buy this for 70% and you allocate $10,000 to turning around closing, right, the 10 to $10,000 check to go away. That should get it done 56% of the time. If not more. Yeah. I'm really excited to see how that performs. If you get it, we could finally actually fiction this here. Like, I think that's a huge one. Another one we've done well with is so you mentioned code violations. You can pull the stop work order. That's online. You know, you can pull the stop work orders where they are in Chicago. We've had a lot of luck with that. A lot of times that person's upside down, you can't do much with it or you got to reach out to the hard money lender to say, Hey, like, what can we finagle here? But there's been signs where they've had enough where they can walk away and they're not upside down on that loan and you can go finish the project. For sure. Yes. Yeah. So I'm glad you guys have had a lot of success with that. I haven't hit that list, but I hear it frequently. So it's why I included it and ranked it pretty high on the free list. Yeah. Same thing, man. You drive by and you see the orange sticker. Go ahead and write that down. Like that's that's right. It's always an orange sticker. Yeah. And you see that like go write that down. If you don't know what to do with it, text me, like it will figure something out. Yeah. So all right. So let's let's dive deeper now. We've gone through the freebies. What else have we got? We got a couple more to round out. 25. Yeah. So vacant homes. The post office delivers mail. If the mailbox is full, the post office will stop sending new mail for that property. So the post office has the best source of what homes are vacant, right? Because they're not able to deliver mail anymore. So we buy the data from the post office and put it in the machine. And so that's why you can have basically list filter on the machine. Number 20, expired high equity, which means they tried to sell it with an agent and it didn't sell. So now you can reach out directly to the owner to see if they just want an offer on their house. And the fact that they have high equity would allow you to potentially offer a low price and for them to be able to accept it doesn't mean they will, but it means they would be able to because they would have enough equity. They could pay off that loan and take some extra money home. 21 tired landlords just means they've owned it over 15 years. A lot of landlords aren't keeping up with their property. So by that time, it's a little bit beat up. It's out of date, certainly after 15 years. And that's why it's called tired landlords, 22 senior owners, anyone over 65, they might be downsizing. They might be moving into an assisted living center. Like the first deal I did, he had a tarp on his roof. It had been there for years, but he finally fell. He had an injury, right? He was finally like, well, I need to move out can't do this grass cutting anymore. And so his house was in no condition to sell it. So he was able in wanting to do a cash offer. 23 zombie properties means it's vacant and going through foreclosure, 24 absentee owner. I mean, that's the basic advice a lot of people get, but I put it pretty low on the list because it's expensive because I mean, I'm an absentee owner, but I don't want to sell my properties. So I think there's a lot of absentee owners out there that don't want to sell. So you could be wasting a lot of marketing, you know, just, just reaching out to all the absentee owners, you know, it'd be better to narrow it down a little bit more. And then 25 was like an out of state owner. So it's, it's, it's like absentee, but possibly even better because they're removed from wherever the property is. And you know, I just talked to somebody today who markets to absentee owned, his, his name is Derek, Chris and actually, and he does ringless voicemails, which I, I don't really know too much about, but I know it's like a very cheap way of marketing. So he doesn't mind that the absentee owner list is so big, right? Cause his marketing is very inexpensive. So for what it's worth, throw that out there. I know people still filter and use that. So basically, you know, the last part of the list is expensive because it's easy to get and fairly broad, uh, bigger the list means more calls, texts, uh, and that costs money. Uh, and the more popular the list and more investors are talking to that seller. So it's harder to negotiate a good price. So the top of the list is more niche, less attacked list. So it saves you money marketing and also allows you to buy at a deeper discount with less competition. So, you know, start at the top so you could risk less money, uh, and make a bigger finers fee and then add in to the list one by one. Um, and if you, if you know, you know, how to speak to a motivated seller, if you want to know rather, um, I've got another episode on that. I'm sure you guys do, uh, you're in the right place, right? Um, so yeah, that's pretty much the 25 lists. I know you guys are probably surprised how quickly we got through it, but, um, I'm telling you, it's, it's not too complicated. It's just executing and doing the work. Yeah. So for someone who's brand new, like they're just getting started, they're, they're on bigger pockets. They're listening to the podcast. They're probably in their non-position right yet to send the list. What, where would you send them? Like where, what advice would you give them to get to a point where they can start sending out a few thousand mailers? Well, I mean, just doing the deals, top of the list, drive for dollars, do a couple deals there, then add in the tax delinquent, then add the code violations. Um, I mean, I don't think the, I don't know, I, I think you gradually increase otherwise you're like me. Remember when I said I was really stressed out in 2019, it's because I went from 27 employees to adding 20 more. So it was just, it was too fast. It was, uh, more than was, it was ready for, uh, but it, but it sounds exciting. So you're like, man, I'm all in. I'm putting it all in black at the casino. It's really exciting. It's kind of what I did basically, uh, but it would have been better to slowly increase the staff because then I would have been ready for the, the, the personnel issues when your culture changes so much, right? Cause you have a lot of new personalities. So then nobody really knows what the existing deal machine culture is. Um, so people kind of rub each other the wrong way cause they're not used to that. Um, and then switching out people that don't work out as expensive cause then you have to retrain them. And then the person who trained them is kind of demotivated cause they just spent all this time training them. So it's just that, that type of stuff, right? Um, when you, when you really scale fast, I think it's challenging if you haven't been there before. Yeah. And also discouraging. I see a lot of real estate investors jump right in and they go for all the lists or they get in over their head and they, and they, they, they spend all their money on the first two mailings when they really got to get off for eight or nine. So, and they discouraged and they do nothing and then they say you probably heard this many times, uh, yeah, that doesn't work or that didn't work for me. It's like, yeah, you shouldn't have the time. Right. Yeah. Well, along those lines, like what are some general guidelines you can give for, hey, you know, you need to send at least in your sequence, you need to send at least five rounds and you need to have the list being, you know, at least a couple thousand, like, yeah, well, yeah. So if it's striving for dollars, I always say, I mean, five rounds is good. Um, and I would say that's better than most, uh, but I would, I mean, I would say like six or seven. So the point is like just because the house is run down doesn't mean they're going to sell it right when they get your postcard. Your postcard just needs to be there when they're ready to sell it. So that's why multiple touch points are the way to do that. Um, and so I would say every three weeks, every four weeks and, um, at least, I mean, in Chicago, I would say at least like you got to add like 600 rundown places to have a good numbers work in your favorite list. The more you add, the more likely it is you'll deal with deal faster. Uh, obviously there's costs in sending out more mail, but, um, I think 700 properties in Chicago, six times each would be a great expectation for the work needed to go get that first deal. Awesome. All right. And let's talk a little about you get someone to call and you right away. Okay. How what did you offer? How much? Like give us a little bit of just that role play of. So. Yeah. Absolutely. I, I'm sure that there's like a release, slick guy who could like handle that well. My first inkling would be like, man, I think this is just like a tire kicker because the deals I've done, they've been like so gracious to be talking to me. And if someone's like firing out, like, we're telling me your price or am I hanging up? I don't think they're that I don't think they need to sell their house. So they, you know what I mean? Like, I don't know. I'd, I'd probably say like, like, I can't know unless I like learn about up the condition and I might ask them, but that's my answer. I probably just move on to the next call. There you go. And if you send out for every thousand posts where I just said, I know there's a lot of variables that go to fully loaded question. But what's an expectation on calls? Like is that 10 calls, 50 calls, a call, like, yeah. So the tax delinquent list, uh, where I actually sent at 1700, uh, I got about like 30 texts or calls over the course of like two weeks. Okay. So that's a pretty good number. Basically. And then one deal. Yeah. I mean, a lot of them were tire kickers. So I would count that in the text back, but not necessarily like a good lead. Yep. Understood. Cool. Mark, anything else guys, how would you answer that question in Chicago? It's tough. I mean, for, for me, I play on the north side and there's just not, I'm not using this excuse, but there's less distress here than there are in other areas. Like, they're just, you don't have as much. It still exists. There's still opportunity, but you really need to go, you really need to get out there and do it. Um, and I'm personally, my, my, my problem that I've had is, you know, I've had our time VAs making calls. I, I've dabbled in direct way. I haven't, I haven't done that. All right. I'm dropping 20 G's on this until it's full force, I've just dabbled in these different things that it gets tough to do it in these, in certain neighborhoods where you really got to be fully committed to it because there's just not as much opportunity as there are. And I'd say like the west side or the south side. Well, I think when you get the, to what you were saying, David, when you get to the person that might stand a chance, they have pain points. And usually people that pain points are willing to tell you about it and, uh, kind of going, uh, digging into whether pain points are and ask, just asking questions and being curious and, and, uh, uh, like offering recommendations of, if, if I can't help, I might be able to have someone to help you. I think, uh, goes, goes a long way in trying to build that rapport in that first three minutes. Yeah. I, I will say once I've been in front of a seller, cause, and here's the other thing, cause I'm licensed. I, I always have the out to tell them, Hey, we can list this. If you want to go that route, right, you, you don't have to go this way. These are the options. What makes the most sense here? Right? So they don't feel like they're being forced into a corner in the balls in their court, right? They can choose to go list this thing. They want to list it. I think that's held like those conversations get a lot easier when you can present different options. For sure. Oh, Mark, what about you guys on the property management side? Cause I know you guys sent out a decent amount on the commercial front. Yeah. We, we sent a lot out on the commercial side and then we sent a lot. Um, I was going to, I wrote a note here to sign up for the seven day free trial, but on the property range aside for, you know, it's really absentee to landlords. Um, but man, we get hired, uh, when people don't want to deal with the BS, um, and if we could get to them, when they're at that frustrated point, when an eviction list or something like that, like that, that's, uh, I think we have opportunity or our industry has opportunity to help people not sell that property too soon. Yep. Oh, oh, we ready to wrap. All right. All right. Let's do it. Here comes your, your little fire round here. All right. David, what's your competitive advantage? How have you been able to do all this while others wish they could? What's my competitive advantage? Man, I'm just taking action. I think there's so many houses out there. You just have to continue to be the right one that reaches the right person at the right time and they call you and they want to do the deal. So I think that's it. There you go. You said that complicated. He said it so genuinely too. Like it was just so true though. All right. What is one piece of advice you would tell someone that is yet to buy their first property? Uh, one piece of advice. So tell someone who is about to buy their first property is don't quit too soon. I get to see a lot of people who pick up the machine with lots of hopes and dreams. They end up canceling saying it doesn't work for them in their market. We have a conversation. They've added 10 properties and there's just just not enough. You've got to work the numbers in your favor. Um, and, and I was really stupid. You remember that house when I was first starting out? I, I told you, um, I thought it was my house that I deserved that house, but I had just like thought about it. Right. I wrote it down and just thought about it for like three months. So I think it's really easy to do and I just want to make sure you don't quit too soon and you, you're able to put in the amount of effort needed to get a deal before giving up. Uh, and we talked about it for driving for dollars, 700 deals that look run down and market to him six times each. Awesome. I think I know this answer, but what do you do for fun? Uh, yeah, because it's really into the race car driving, um, I also last year was very in a wake surfing, uh, so it's like where you're behind a boat on a board without a rope. Um, and I actually did a competition and I got dead last. But I really just had fun doing it a lot, uh, not even the competition aspect. Good stuff. All right. Besides your podcast, give us a good book podcast or self development activity that you'd recommend to our listeners. Okay. Um, yeah, the first thing that comes to mind is, uh, my first million podcasts, they, they have live podcasts in Austin a couple of times, but, uh, it's, it's a great podcast, uh, that they do in the studio frequently, uh, and I, I listen to that probably every week, but answer. Nice. Besides yourself, name one person, your local network, uh, or your, your, your, uh, uh, larger network that you'd recommend to other investors as a quality resource. Yeah. Um, there's a guy named Nick Gray and he is not an investor. Uh, he, he started a company called Museum Hack where he'd make these renegade, uh, tours of museums in New York city. He sold that company and then he lives in Austin. And the reason why I thought of him is because he was the MC for the my first million live podcasts when they've had that. And he just seems to be the MC for like every event. Um, and you should pick up his book called the two hour cocktail party because entrepreneurship is lonely and the two hour cocktail party is a great way to host your own parties and a great structure for that, which is helpful for me. Um, and a, in a great way to just increase your social circle and enjoyment. Uh, and I'll just sleep a bit at that. I also like five or six cocktail parties in my apartment. I didn't even drink, uh, last year and was just able to like come to a new city and meet like hundred, literally like hundred plus new friends, uh, that had a meaningful connection to me because they like, they came into my space. They might have gotten invited by a friend or by me and a random coffee shop or elevator. Uh, but that guy wrote that book and it really left an impact on me. And the city always has him as like the host too. So obviously others too. So check out that guy, Nick, or a, uh, the museum, heck, that's awesome. That's such a cool concept. Yeah. I never did that. I think it's still going, but I know that was his like exit and why, you know, how he kind of made money. There we go. All right. Uh, David, thank you so much. You provide a ton of valuator listeners. How can they learn more about you? Is there any way they can provide value to you? Um, yeah. I mean, I, I post content on Instagram is where I focus, um, on racing, but also real estate investing. And if you guys are looking to, I mean, everybody's using deal machine for the unlimited contact info right now, you know, if you need to skip trace 50,000 leads and, uh, that would cost you $5,000, but I mean, you could do that every month for $149 on the deal machine, you know, monthly fee. So check out, do a free trial of deal machine and check that out. All right. That's a good stop. Thanks for listening to the deal machine real estate investing podcast. Please leave us a review and follow along wherever you're listening to your podcast. Okay. Okay. Thank you. Bye. [BLANK_AUDIO]
If you are looking to get your first real estate deal, we cover the top 5 ways to get great deals off market in 2024.
Key Talking Points:
(0:00) Introduction: David Leko's appearance on the Great Chicago Investor podcast.
(0:42) Switching to Deal Machine: Host shares his experience.
(2:04) David's Racing Career: How racing helped manage stress.
(5:34) Genesis of Deal Machine: Origin story of the app.
(8:07) Deal Machine's Evolution: From personal tool to comprehensive app.
(9:52) Top 25 Seller Lists: Focus on motivated seller lists.
(12:01) Driving for Dollars: Effective method for finding deals.
(15:20) Using County Websites: Accessing free property lists.
(18:44) Code Violations: Identifying potential deals.
(21:11) Eviction Lists: Finding motivated sellers.
(22:54) Utility Issues: Water shutoffs and utility liens.
(24:11) Vacant Homes: Using postal data and expired listings.
(26:10) Advanced Filters: Utilizing Deal Machine's features.
(28:04) Paid Lists: Exploring paid options for property data.
(34:12) Investing Strategies: Maintaining focus and pacing growth.
Links and Resources Mentioned:
Deal Machine App: dealmachine.com
Deal Machine Unveiled Event: dealmachine.com/unveiled
Nick Gray's Book: The Two-Hour Cocktail Party by Nick Gray - A guide on hosting successful social gatherings.
David's Social: @dlecko
https://www.dealmachine.com/pod
Ryan's Social: @heritage_home_investments
https://www.heritagehomeinvestments.com/
