AG Gupt – Investing with RealAcquisitions

Mike: Welcome to the flipnerd.com Podcast. This is your host, Mike Hambright. And on this show, I will introduce you to VIPs in the real estate investing industry, as well as other interesting entrepreneurs, whose stories and experiences can help you take your business to the next level. We have three new shows each week, which are available in the iTunes store or by visiting flipnerd.com. So without further ado, let’s get started.
Hey, it’s Mike Hambright with FlipNerd. Welcome back for another episode of our FlipNerd VIP Interview Show. Today, I have with us, A.G. Gupt, he’s the CEO of Real Acquisitions. It’s an interesting company that’s bringing technology to real estate investors, and allowing real estate investors to find more leads, and find more deals. Before we get started with our interview, one you don’t want to miss, let’s take a second to recognize our featured sponsors.

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So, A.G., welcome to the show.

A.G.: Thank you, Mike. Looking forward to it.

Mike: Good, good. How are you, today?

A.G.: Doing very well.

Mike: Awesome, awesome. Well, you guys are making some noise in the industry, and helping investors buy houses in some unusual ways. And rolling up some of the lead generation activities. Why don’t you take a moment to tell us a little bit about you and your background? And then we’ll get into talking a little bit about your company and some of the services you provide.

A.G.: So, it’s stereotyping background of an Indian, but [laughs] my, exactly stereotypical Indian background, came from a consulting services background. I used to work for a Big 5. I left that quite a while ago. Jumped into various forms of businesses, Real Acquisition happens to be my third venture…

Mike: Okay.

A.G.: . . . that took off. [laughs]

Mike: Meaning the other two took off as well, or . . .

A.G.: Nope.

Mike: Okay.

A.G.: [laughs] No. They were good experiments, they were great learning opportunities.

Mike: That’s right, yeah.

A.G.: But, they were stepping stones towards what, I guess, Real Acquisitions is today.

Mike: Okay. Okay. And before you get into the details of what you do, we were talking a little bit about how there’s a lot of fragmentation in the real estate investing industry. And in many ways, technology is always late to the show in the real estate investing space. And I’m sure that’s where you saw some opportunity to enter in. Before starting this company, did you have experience or background in real estate investing?

A.G.: Not at all.

Mike: Not at all, okay. Tell us a little bit about that, like, how you identified the opportunity, and then, how you’re obviously taking advantage of some of the fragmentation and lack of technology that most real estate investors have access to.

A.G.: The story really is that in 2007, I bought my home in the Galleria area of Houston. And like most subdivisions or locations right in the center of the city, land is always a commodity. So I live in this townhome, this 2500 square foot lot of land, and I wanted to buy some land next to me. So for almost seven months, I saw a completely vacant piece of land next to me. And no matter what I did, I could not figure out who that land belonged to, why is it that it’s it not on the market? Who is the agent representing that? And that’s sort of what opened up a Pandora’s Box in my investing career. Which is, “How do you chase and acquire an off-market property?” That’s the bottom line question that I tried to answer. And the hoops that I had to jump, the amount of money that I had to spend, the guru chasing that I had to do for four months to try and figure out how to buy off-market properties, what Real Acquisitions resulted in.

Mike: Okay. Okay. And did you buy that piece of land?

A.G.: I did.

Mike: [laughs]

A.G.: I absolutely did.

Mike: All right. Yeah.

A.G.: And in the process of buying the piece of land, is how I got to meet my business partner, Clay Cahoon. And to answer your question, he was a pretty seasoned investor. Had been in the market for almost seven, eight years, actively investing. And through my process, through my journey, I came across him. And that’s how, along with Clay Cahoon, and another third friend of mine, who has a technology background, gentleman by the name of Kurt Lund, that’s how Real Acquisitions came to be in 2009.

Mike: Okay. Okay. And, so tell us a little bit about what your journey is. It’s, essentially, to access information that’s not readily available or to consolidate it from multiple sources and try to determine whether there’s some sort of trigger that may notify your partners or your customers that there is a motivated seller behind there somewhere? Is that essentially what you’re doing?

A.G.: Yes. So, think of us as a data integrator or data aggregator, that combines four buckets of data. First, is appraisal. Well, having access to appraiser records for a GMA or an MSA, gives us access to almost two to three million properties, for example, in Dallas. Similarly, about two to three million properties in the greater Houston market area. And to combine that, you juxtapose that with your traditional inventory on the MLS, which is less than, in Houston, for example, as of this morning, there are less than 5,000 single family homes available for sale. Pretty much the same, more or less, in Dallas. So almost 2.8 million in Houston, versus 5,000 on the MLS, a big difference.

Mike: Yeah.

A.G.: So we take the appraiser records. The second bucket that we deal with is district and civil records. So district, court, and civil court records give us access to information, like, probates. Information, like, bankruptcies, information, like, tax lawsuits. And many, many, various different kinds of distresses that attach themselves, sometimes, to a property, sometimes, to an individual.

Mike: Okay.

A.G.: The third bucket that we deal with is MLS. You obviously need MLS to properly evaluate and come up with an actual market value of an asset or in our language, we call it, “ARV,” which is the After Repair Value of an asset.

Mike: Right.

A.G.: That’s number three. And number four, is land records. The land records gives us access to, primarily, two things that we need. One is, obviously, the deed. The other is the deed of trust, which helps us create many multiple offers, many creative offers, because now we have an immediate access to equity. And then, in addition to that, it also gives us opportunity to look for distressed title issues. Contrary to popular belief, properties that do not have a clear way or a clear to closing, offer many opportunities for investors to do creative acquisitions.

Mike: Sure.

A.G.: So that’s, in a crux, what Real Acquisitions is. Now, as a data aggregator, anyone can go, right now, to a courthouse, and get, let’s say, listings or get the entire download of the probate.

Mike: Right.

A.G.: But here’s a question, how do you match lot three, block five, Stone Hedge to the actual 123 Main Street, that the address correlates to?

Mike: Right.

A.G.: Because as you know as an investor yourself, that none of these four entities, the MLS, the appraisal records, the land records and the court records, none of these four people talk to each other.

Mike: Right.

A.G.: So, our strength for the past two and a half years, has been building the engine, that seamlessly integrates this information.

Mike: Okay. Okay.

A.G.: That is Real Acquisitions in a nutshell.

Mike: Awesome. And, I assume, I challenge . . . do you operate outside of Texas today or do you operate in other markets, as well?

A.G.: No. Right now, we are primarily focused on Texas.

Mike: Okay.

A.G.: Because Texas being a non-disclosure state, gives us the opportunity of solving the non-disclosure problem, where a lot of information is hidden. So how do you extract that information and make it searchable?

Mike: Right, right. And do you have plans to expand outside of Texas?

A.G.: We absolutely do.

Mike: Yeah.

A.G.: This year, we are very actively seeking funding, as well as a relationship with the brokerages that can help us launch beyond Texas.

Mike: Okay. And talk a little bit about the pieces that are need for
. . . obviously, when you expand into, even into other markets inside of Texas, you’re dealing with multiple MLS’s, so you have to get access to that data. I assume things, like, appraisal, districts, their data feed is probably different from one to the next, every time, right? So, talk a little bit about, I know a number of people that are creating technology products in the real estate investing space. Whether it’s subscriptions to get comps or some way to analyze deals or properties. And that seems to always be the biggest challenge they have is, how to tap into those local data feeds, and consistently get them. Sometimes, you develop a relationship with an agent or a broker that can get them. But if that person changes their mind or gets hit by a truck, then you’ve got to find .
. .

A.G.: [laughs]

Mike Hambright:. . . somebody else. Talk a little bit about the challenges of just how fragmented all those data sources are across the country.

A.G.: That’s a good point. I mean, literally, based on the last study, there are over 1200 MLS’s right now.

Mike: Hmm.

A.G.: MLS is supposed to one of the most prominent, well-established, well-
seasoned, and well-funded databases in the real estate industry. But just to give you an idea, that one of the most well-funded database, there are 1200 of those throughout America.

Mike: Right.

A.G.: And when you come to the second, third and the fourth bucket that I mentioned, there are thousands, and thousands, and thousands that you deal with. But to answer your question, “How do you consolidate that?” That is a challenge, that is a question that we answer, and we solve on a daily basis.

Mike: Mm-hmm.

A.G.: And it’s not an easy challenge to solve. That’s the reason that there are only, as of today, there’s only one national player in this market. Even they don’t have the complete access to all these databases that I’m talking about.

Mike: Hmm.

A.G.: And in a nutshell, our philosophy, our business strategy to solve the problem has been to stop being a data company, and being an actual acquisitions entity. So last year, in 2013, we rebranded ourselves. We rebranded our licensing, we rebranded out internal operations to become a full-fledged brokerage. Because as a brokerage, we can play as an insider. As a brokerage, we can go and have legitimate access to data, and truly turn around and use the data for the purpose of acquisitions, itself. So internally, we are doing a lot of acquisitions, using that data ourselves, providing turn-key operations, like, you may have noticed on our site recently, to our investors and our clients.

Mike: Mm-hmm.

A.G.: And what that does allow us is two things. First, as I mentioned, a legitimate access to local MLS, because getting access to public data, like, court records, is not typically a big deal. It’s just a question. It’s just a function of having the right funding in place, because some of the public data can, indeed, be very expensive.

Mike: Mm-hmm.

A.G.: But once we have access to the local MLS, via a legitimate brokerage presence, we turn around and we convert that market into a wholesaling or an acquisition operation. By getting boots to the ground, by parking with the local folks in that market, we provide the data, we provide expertise. We provide, in many cases, the marketing funding to go out and send out letters, billboards, internet campaigns. And as the calls come in, as the properties come in, our local entities, our local agents, our local partners, go and convert these leads into actual contracts, actual transactions for the local community there. So gives us access, to also, a alternative, and a significant source of revenue in those local markets.

Mike: Okay. And the actual advertising, the things you’re doing to generate, I know you have, we can get into the different offerings you have, shortly, because I know you have, on some level, you have subscriptions, where somebody can get access to the data, and essentially, mail them themselves. And then, you have a “done for you,” product, where you can, even down to having agents work the leads for people, and try to get deals that way. So talk a little bit about how you, is that all under the Real Acquisitions brand?

A.G.: It is.

Mike: It is.

A.G.: It’s currently all under the Real Acquisitions brand. But starting this year, given the size and the nature of the operation, the way it’s expanding, and, obviously, because of our liability repercussions, we will be segregating the businesses into three separate entities.

Mike: Okay. Okay. And how do you, and this is probably leading into the next question I have, in a little bit, how do you separate, essentially, selling your data to some people, and then competing against the very same people for the very same leads under one of your other services?

A.G.: It’s a great question. And that’s a question that we get asked a lot of times. And, I think to an extent, before we started the interview, I alluded to the answer. The answer lies in the sheer volume of the data that we’re talking about, here.

Mike: Yeah.

A.G.: And to put in perspective, as of this morning, there are approximately 160,000 properties that are in a serious tax delinquency, just in Harris County.

Mike: Hmm.

A.G.: There are over 85,000 properties that are in some kind of a probate issue.

Mike: Okay.

A.G.: And I can go on, and on, and on. I can talk to you about loan modifications.

Mike: Right.

A.G.: In the DFW market, from February 1st, which is, what, four days, five days?

Mike: Right.

A.G.: There were 8500 loan modifications filed.

Mike: Wow.

A.G.: And the reality is, these hundreds of thousands of potential deals, it’s physically, I’m yet to hear a solid business case of someone being able to come and tell me that there’s not enough of the pie. Truly, without getting into cliches, the pie’s truly not big enough . . .

Mike: Right.

A.G.: . . . for everybody [laughs] to slice from.

Mike: Right. Right. So what you may have a tendency to do is use a specific data source that you keep to yourself or sell to one subset of people, so they’re not necessarily competing directly with other subsets or no?

A.G.: No. We haven’t, like I said, because the volume . . .

Mike: Right.

A.G.: . . . makes the question moot, at least at this point.

Mike: Yeah.

A.G.: Now, I’ll grant you that, that is a challenge that I’m not a fool to not realize, that it’s coming down the pipeline . . .

Mike: Right.

A.G.: . . . as the services are growing rapidly. I mean, we grew phenomenally last year. And as our services plan to grow this year, that is a challenge that, when it presents itself. And we have some ways that we have thought around solving it. The biggest challenge, as you may realize, I like to say that, we have given the iTunes model to the real estate investment world. Now, for about 1,000 bucks a year, people can have access to all of these things that I mentioned. And earlier, they were used to paying mentorship fees, and 25, 30,000, $45,000 to go to a special convention, and then learn of the secret database that’ll help. We’ve given the 99 cent model . . .

Mike: Right.

A.G.: . . . to put it in the iTunes [laughs] world.

Mike: Right.

A.G.: How do you take that away from people?

Mike: Right.

A.G.: How do you now suddenly say, “Oh, now it’s no longer $1,000. Now, it’s this much.”

Mike: Yeah.

A.G.: Or, “Now, certainly, you cannot have access to this data.” It’s an embedding process.

Mike: Right.

A.G.: So we just have to put the right incentive, because I don’t want to forget how we came to be. I don’t want to forget that the driving factor for us was to simplify this data process for investors. So we don’t want to take it away.

Mike: Right.

A.G.: But at the same time, we do realize that a majority of this data right now, goes unused by investors. Majority of investors don’t really have the gumption, the skill-set, and frankly, the financing, to convert these leads into transactions. So it’s wasted data, with majority of the time, in our opinion.

Mike: Yeah. There’s no doubt that there’s this myth in the real estate investor community that this is not a hostile business. I mean, a lot of folks see the end result of, “Okay. Somebody has a house, and they fixed it up and sold it.” In fact, I was getting my haircut yesterday, and talking to the woman cutting my hair, and they always ask me. I get my haircut at 11:00, and they’re, like, “Are you on a early lunch break?”or I’m, like, “Well, no. I work for myself, and I might not even go to the office today. Who knows?” And they’ll go, “What do you do?” And I say, “I’m in real estate investing.” “Oh, I really like watching these shows where they rehab the house.” And the problem is, is nobody realizes the hardest part is actually finding the houses. [laughs] So, I mean, rehabbing them is nothing. Selling them is generally nothing. And certainly, in the past few years, it’s easy finding the deals, and negotiating it, working it through title issues, all those things. That is 90 percent of the work. The rest is easy. You could just throw it in the hopper . . .

A.G.: I absolutely agree.

Mike: . . . and let it pop out the other end.

A.G.: And if you look at our industry, Mike, it’s that lifecycle of finding a deal, curing issues, getting in a contract. That’s, unfortunately, what has given us a bad name.

Mike: Yeah.

A.G.: Because people make it a big secret. I mean, if I know the ARV of a property, if I know, via the Deed of Trust, if I know the equity of a property, if via the Chain of Title, I have a decent idea about what’s going on, the Chain of Title of that property.

Mike: Right.

A.G.: If I know my exit, what the hell am I going to do with a property?
That’s all that I really need. I don’t need to pay somebody kajillions of dollars to go and learn these four things.

Mike: Yeah. Yeah. Now, so, a lot of the things, it sound like some of the data sources that you have, whether they’re delinquent with taxes, whether it’s short sale issues, they’re behind on payments. The reality is, a lot of folks that are behind on payments, don’t have equity. They’re probably upside down, when you consider repairs on a house. So there’s a lot of deals out there that, even though they’re behind on payments or way behind on taxes, it doesn’t mean there’s equity in there that makes sense for an investor to buy it. But can you talk a little bit about how . . .
obviously, it’s a challenge for individual real estate investors to go, whether they’re negotiating a short sale, is that a service that you provide through your brokerage model now? When folks find deals or find leads that need some level of negotiating, is that something that you do or you partner with folks that do or . . .

A.G.: We do. Like I said, we’re a full-service brokerage.

Mike: Yeah.

A.G.: If you use our data or even if you don’t use our data, obviously, the pricing is different . . .

Mike: Right.

A.G.: . . . we provide consulting services to you, in terms of structuring a transaction. But I also want to say this, is that we do a lot of deals, a lot of transactions where people are upside down, and there is no equity, but there’s great cash flow.

Mike: Mm.

A.G.: I can do wraps around those, and I can create phenomenal cash flow, via Sub-To transaction . . .

Mike: Right.

A.G.: . . . or in many cases, a wrap. In those cases, I don’t care about equity. I’m not saying that the spread is too far apart . . .

Mike: Right.

A.G.: . . . but if the spread is too far apart, but there’s great cash flow, our clients buy those deals all the time.

Mike: Yeah. Yeah. So tell me about, you say you operating primarily in Texas. And is that in just the major metro areas, just the Dallas and Houston markets or are you in San Antonio, Austin, West Texas, I mean, everywhere in Texas or primarily . . .

A.G.: We are in Houston, DFW, San Antonio, and we’re about to launch Austin.

Mike: Okay. Yeah. And the percentage of the population of Texas in one of those four major metro areas is, I don’t know the percentage, but it’s, obviously, more than half of the state anyway, right? So . . .

A.G.: Oh, yeah.

Mike: Yeah.

A.G.: And it’s also driven by justifying investing activity, because this is not a regular, “For Sale By Owner,” kind of a service.

Mike: Right.

A.G.: The data has a cost, and we have to justify the cost, in terms of investors using the data and doing transactions, via us. That’s basically the bottom line.

Mike: Okay. Okay. Well, do you want to talk a little bit about the three different models that you have in place? I think it’s three. Whether it’s selling the data or access to data subscription service, and then you have more of the, “done for you,” service. And then I know you’ve got more of an institutional product that you’re, at least, working on. Do you want to talk about the kind of offerings that you have for folks who might be interested in learning more?

A.G.: Sure. There are three things that we provide. One, is a very simple data retainer model. The data retainer model is that you retain us for month to month or annual contracts, whatever you want, based on your needs. And we provide you access to data. That’s ideally designed for people that have the desire, the skill-set and the resources to take that data, and convert that into a marketing campaign on their own, do the acquisitions on their own, and do the whole nine yards of the acquisitions process. Obviously, when I say, “data,” it’s not just motivated sellers. As I mentioned, we provide the entire package, a suite of services that assist within the acquisition business, which includes a CRM, as well.

Mike: Right.

A.G.: Managing those conversations, all of that stuff. The second level of service is inventory. As our own brokerage, we are very actively going out and looking for transactions and deals ourselves. And that business model came to me last year, because we were made aware, and I’m sure it’s not a surprise to you, that a lot of wholesalers, primarily, were misrepresenting and misusing our data, and bringing extremely bad deals to the market. So if you take any good deal, and you take the ARV up, and you bump down, tremendously, the rehab, you can make this into a classic deal.

Mike: Right. So you’re saying that some wholesalers misrepresent the deal? [laughs]

A.G.: [laughs]

Mike: Yeah, it’s unfortunate.

A.G.: And what was going on, is they would cherry-pick the comps, whatever. They would cherry-pick the figures.

Mike: Right.

A.G.: And the brand name that would go on the report is Real Acquisitions. So we wanted to solve that problem. And last year, in conjunction with our broker here, we launched a wholesale service. We are providing some great deals to local investors that don’t really want to do the acquisitions.

Mike: Right.

A.G.: The separating factor of that service, very simply, is that we just don’t bring cash deals. And we do not bring, believe it or not, we do not bring MLS deals. I was surprised to see majority wholesalers are bringing MLS deals to investors. But, these are deals that . . .

Mike: Now, what do you, say that again. You “don’t bring cash deals.”
What does that mean?

A.G.: So, we bring Sub-To deals. We bring Seller Fi deals.

Mike: Okay.

A.G.: So we negotiate those deals, in what we like to call, is, “Creative Financing,” or “Creative Structuring.”

Mike: Right.

A.G.: And we bring those to investors.

Mike: Okay.

A.G.: For people that use us for flips, we bring what I like to call a,
“Short-Term Sub-To.” In the duration of the flip, three months, six months, the transactions done a Sub-To, which prevents the need to borrow hard money or private money, and do a flip.

Mike: Yeah, okay.

A.G.: So that’s the second level of service. The third level of service is where we take over the entire process for you. It’s used by institutional investors, but also by investors that are looking to buy without having to get their hands dirty. The reality is most people are today paying, 8, 10, 9,000, 15,000, $20,000 dollars to wholesalers for bad deals. And the service was started, primarily, to understand the customized needs of an individual. So here, “I am an investor, here are the five criteria that I have. This neighborhood, year built, 1980 or later, 2,000 square foot or higher, this kind of cash flow, this kinds of schools around me,” whatever.

Mike: Right.

A.G.: Whatever your needs are. Based on that, we design an Acquisitions Campaign, which includes letters, which includes internet marketing, which includes bandit signs. And our agents go and they create the letters. They handwrite the envelopes. The mailers go out. They take the phone calls. Obviously, the entire transaction is transparent, because as a client, through our CRM, you have the entire transparency of what call came in, who’s the seller, what’s the phone number of the seller, what’s actual conversation.

Mike: Right.

A.G.: And then they turn around, and they assign the property over to the investor without any assignment fee.

Mike: Okay. And so, you charge just a flat monthly fee for that service or . . .

A.G.: Per campaign.

Mike: Per campaign, okay.

A.G.: Depending on the size, and the extent of the campaign, the costs are different. But they begin, typically, around $15,000.

Mike: “Campaign,” meaning the advertising campaign. So whether you use . . .

A.G.: Acquisitions . . .

Mike: . . . direct mail or an online, uh-huh. I see.

A.G.: Yeah. We call it an, “Acquisitions Campaign,” because it’s not just direct mail. It includes signs, it includes internet marketing, and various other things, as well.

Mike: Okay. But what defines the campaign? The ARV of the house or the geography of the town or . . .

A.G.: Your needs.

Mike: I see.

A.G.: Your needs, that’s it. You tell us what your needs are, and we’ll obviously negotiate those needs with you. I mean, if your needs are extremely unrealizable or extremely stringent, we’ll advise you against it.

Mike: Right.

A.G.: But based on your needs, we’ll design an Acquisitions Campaign.

Mike: Okay. Okay. Well, why don’t you talk a little bit about some of the things that we’ve been talking about, all throughout this, is the extreme fragmentation in the real estate investor space. The fact that the biggest guy in town, the biggest competitors in town probably have a couple percent market share, because it’s so fragmented. Talk a little bit about just your general thoughts on how that will change over the years to come. And now just in the markets where you serve, and through your product, but how you see technology assisting real estate investors, and eliminating, at least, some of the fragmentation over the years to come or one thing I should say, or the fact, as we’ve discussed early on, the MLS’s are all different, the central appraisal districts are all different. I mean, in all honesty, it doesn’t appear to me that many of those data sources that you’re tapping into or that investors deal with in every market, are using any technology. They don’t seem to be getting any more sophisticated, because they don’t really have the need to at their level. Is this something that is just going to continue on for the foreseeable future?

A.G.: I don’t see that, and I’ll tell you why. I think there are three factors, in my personal opinion, that will play majorly into our industry, which is, basically, personal listed investing industry. One is that for the first time in the history of our more economic times, single family houses have been recognized as an asset class in themselves. Hence, the initiatives for the past 18, 19 months, by institutional investors to go after this asset class.

Mike: Right.

A.G.: So, when the big boys, when the black stones of the world, when the BLT’s of the world, when the 642’s of the world are coming in our industry and buying in bulk, that brings in a lot of Wall Street grade attention, and Wall Street grade money, into our industry for the first time. And obviously, what follows is step two, which is, I think, the second contributing favor. Which is, technology entrepreneurs, like us, coming in the market space and solving a lot of these questions. And the crux that we are all trying to solve, individually, collectively, is centralization. How do we centralize and how do we normalize this data? And with all these nationwide initiatives happening, this problem definitely will be solved.

Mike: Mm-hmm.

A.G.: And in terms of normalizing, that’s a very database term, but normalizing basically means, “How do we make this data the same . . .

Mike: Right.

A.G.: . . . as it is in Florida, as it is here, as it is in Seattle.”

Mike: Right.

A.G.: So, the second . . .

Mike: Go ahead.

A.G.: Go ahead.

Mike: I was going to ask, do you think that the institutional buying, paying, essentially, in most markets, they’re paying, essentially, close to retail value for houses. And, do you think . . .

A.G.: Some of them are, yep.

Mike: Do you think that’s sustainable? I mean, I foresee this not lasting real long. I mean, these assets getting packaged up, sold off as reeds to school, retirement accounts. Then, rates go up, market crashes, all that inventory comes back around to individual investors.

A.G.: [laughs]

Mike: I mean, am I crazy? Am I the only, I mean, do agree with that or do you think that what they’re doing right now is sustainable?

A.G.: I partially agree with it. And the reason I partially agree with it is because, it’s, like, going to a Mercedes dealership, and saying, “This car that’s actually worth $120,000, I only want to pay 70 percent of the value of that car.” [laughs]

Mike: Right.

A.G.: We have become used to that mentality, quite a bit. And I think for the first time, and somebody’s coming and saying, “Listen, this car is worth 120, and I’m paying 120 for it.” It shouldn’t surprise us. I know it scares a lot of us, but I do see it’s sustainable. The question is, what is the exit strategy? The questions is, are these funds getting to this business? And buying full retail . . .

Mike: Right.

A.G.:. . . what is the plan to do with this inventory? If they solved the property management question, I think it’s a great industry. I think it’s sustainable. If they do not solve the property management question, I think they are definitely heading for another disaster.

Mike: Right.

A.G.: So, I personally, have no qualms or doubts that buying at full retail value is of an issue. And you know what . . .

Mike: It’s no different, obviously, in markets, like, Texas markets or the Midwest, more so than the Coast, because you just can’t make those work as real estate investments, unless you’re completing speculating on appreciation. But they don’t cash flow.

A.G.: Correct. Absolutely, correct. And unless I’m wrong, I don’t think there’s much institutional buying happening on the west coast . . .

Mike: Right.

A.G.: . . . or the east coast anyway.

Mike: Right.

A.G.: It’s most in, what we like to call, a “second-tier market.”

Mike: Right. Yeah.

A.G.: So, yeah. I agree. The question that we also need to ask is, do we truly believe that markets, like, Texas, have, indeed, a underappreciated value of real estate? I mean, obviously, today, you can go and buy a lavish home in Texas for $150,000.

Mike: Right.

A.G.: You can buy a beautiful, 3,000, 3500 square foot home on a nice piece of land. Is evaluation model going to catch up? Because in Texas, and many markets like Texas, we don’t buy, like you said, for appreciation. So, I think, with these people coming in and buying at full market value, that’s definitely going to help us catch up for the national average. And for those of you people, like you and I, that own a lot of real estate in our rental inventory . . .

Mike: Right.

A.G.: . . . I think that’ll help us appreciate our portfolios more.

Mike: Sure. Sure. Awesome. Well, tell us a little bit how, somebody wants to find out more, how they get a hold of you or how they get to, I know it’s realacquisitions.com. But, why don’t you tell us how they can learn more about some of the offerings you have, and some of the services you have?

A.G.: Well, I request you to talk to us. I think real estate is not really a visual game, yet. I don’t think you can go to a website and understand .
. .

Mike: Right.

A.G.: . . . fully what we do. Talk to us, because more than data, we want to talk to you about what kind of buying and selling or what kind of real estate you are doing.

Mike: Right.

A.G.: And our data services are meant to compliment what you’re doing, so we can design or we can tell you what offerings we have based around your business model. Call us at 855-732-5328. That is 855-732-5328. That’s my radio voice.

Mike: [laughs]

A.G.: Give us a call, we’d love to chit-chat with you or come and meet us. In most of the markets, we are there at least once or twice a month. I know we’ll be in Dallas this week, we’ll be in San Antonio next week. So come and spend some time with us, and see what we’re doing. We’d love to help you out.

Mike: Great. Great. And we’ll add links and phone numbers below the video so anybody watching this can easily get a hold of you and learn more. So, A.G., thanks so much for joining us today.

A.G.: Thank you, Mike. I hope I added some insight. I really enjoyed talking with you.

Mike: Absolutely. It’s great to learn more about Real Acquisitions, and about your journey of how you guys got to where you are. So, I wish you all the best. And I’m sure we’ll be talking again, soon.

A.G.: Thank you, sir.

Mike: Okay. Have a good day.

A.G.: You too.

Mike: Thanks for joining us on today’s flipnerd.com Podcast. To listen to more of our shows, and hear from incredible guests, please access all of our Podcasts in the iTunes store. You can also watch the video versions of our shows, by visiting us flipnerd.com.