Rehabbing Remotely with Jean Norton

Mike Hambright: 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. Welcome to today’s FlipNerd VIP interview show. Today, I have with me, Jean Norton, who is a — She runs Rehabbing Remotely, is educating a lot of newbies and new people that want to get into real estate investing, and doing it in many ways by sharing her experiences along the way, which, ultimately, is the best way to learn. Right? So, before we get started with our interview with Jean, let’s take a moment to recognize our featured sponsors.

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Mike Hambright: Hey, Jean. Thanks for being on the show today.

Jean Norton: Thanks for having me.

Mike Hambright: Awesome. Awesome. So, you’re down in Austin, beautiful Austin, Texas. Right?

Jean Norton: Beautiful Austin, Texas.

Mike Hambright: Yeah.

Jean Norton: Yeah.

Mike Hambright: Awesome. I love Austin. I think I told you beforehand. I actually lived in Austin for a couple years. So, Austin is great. We always love to go down there.

Jean Norton: I bet you hated to leave.

Mike Hambright: It was tough. It was tough. We love to visit. Every time we go, we say, “Hey. We need to come down here more often.” So, but– Well, tell us a little bit about you, about your background, and about getting started in real estate investing. Because I know, like me, it wasn’t your — You don’t have a long life in real estate, and you found your way there. So, tell us a little bit more about that.

Jean Norton: Well, I’m pretty much a serial entrepreneur. I started with technical consulting for the big companies in Austin, on their computers. I did have a franchise retail store at one point, and then I went back to school, and I got my Masters Degree in Technology Commercialization, worked as a software product manager for like three different software companies. I decided I was unemployable.

Mike Hambright: Yeah.

Jean Norton: You know. Then, I went to a real estate seminar. Yeah. It was expensive. I spent a lot of money on it and came back, and I was just determined to make it work.

Mike Hambright: Yeah.

Jean Norton: Meantime, I blogged about my experiences because I went to this seminar, and this was a seminar out in California. I went back out to California. I got a property. I started rehabbing it, and I just tell the story on my blog, all the way. Then, it took like, probably about a year for me to get another deal. I don’t know what happened. There was some shift in the market or something. I had to kind of think outside the box. I was getting — Things weren’t working like I was originally taught. So, I had to ask myself, “How can I get the same results and not follow this exact system? How can I think outside the box?” That’s when I started getting some deals.

I was in southern California, but I moved northern, and I went to Bakersfield, California. Everybody else that I was talking to said, “Man, I can’t get a deal. I’m so frustrated. How can I get into this business?” I had like six or seven deals going. At that point, I just said, “Well, Okay. I’m going to hold a field trip,” and I just had a field trip with investors to come to see a different location, the projects I was working on, meet finance people, my contractor, realtors, et cetera. It just turned out to be a big hit. They said, “Don’t stop.”

Mike Hambright: Yeah.

Jean Norton: Keep it up.

Mike Hambright: So, the better way for you was to not be restricted to your own market, was just to start looking at other places.

Jean Norton: Yeah. My motto is, “If real estate investing isn’t working for you, you need to change your strategy or change your location.” Because you can make money in any location in real estate.

Mike Hambright: Yeah.

Jean Norton: It just depends what strategy you use.

Mike Hambright: Right. Right. So, we’ll talk about some of how you do that, because in all honesty, some of that scares me of not being able to see a house, being able to commit to it, managing contracters. So, I would like to hear more about that. But, let’s talk a little bit about your strategy now. Do you go — Are there specific states or markets you focus on? Or you’re just your ear to the ground everywhere?

Jean Norton: I look at the whole country. I see where the spreads are.

Mike Hambright: Yeah.

Jean Norton: I see what’s going on where. I’d love to go back to California, but just like Austin, it’s hard to touch it right now, based on the strategies that I like to work.

Mike Hambright: Yeah.

Jean Norton: But, for California, Austin, if you want to do buy-and-hold and depreciation, then that’s a strategy. But, I look for areas that have good profit spreads between foreclosed prices and retail prices. I use different Internet tools that are available to me. Some, most of them, free. I can just pick a city. There are some basics, like, does the city have a reason for being there. What’s the stability of that area?

Mike Hambright: Right.

Jean Norton: And, like Miami. Let’s just take that as an example. I’m still bullish on Miami because there’s a lot of international attention and a lot of international money coming in there. In addition, you still have the people who never thought they could ever afford their own house. The markets are depressed enough now that you can actually clean up a house, make a good deal, make some money. I like Chicago right now. I like all of the Midwest, all of the Southeast. You just have to learn how to use the tools to really pick the market, know how to communicate with people so that you know that you’re getting a good contractor, a good power team in place.

Mike Hambright: Yeah.

Jean Norton: I mean, it gets pretty involved.

Mike Hambright: Sure. Sure. So, how do you analyze a deal without seeing it physically?

Jean Norton: Well, I depend on Google a lot, and I depend on Zillow a lot, not the Zestimate, but the actual data that comes on what I’m searching for.

Mike Hambright: Yeah.

Jean Norton: And, if I’m going to concentrate in a particular area, I will find a realtor and ask to be a personal assistant, so I can get MLS access in that area.

Mike Hambright: Okay.

Jean Norton: There’s no better way than just to have MLS access.

Mike Hambright: Sure. Sure. How about the repair side?

Jean Norton: The repair side is tough. I look at as many pictures as I can. Often times, I still target foreclosures. Like, in Illinois and in Florida, foreclosures may have been sitting there for a very long time, but they may have tried to sell as a short sale before it was foreclosed. So, if I dig deep enough, I can actually find pictures of when they were trying to sell it as a short sale and find even more pictures. Now, I have a gut feel. I mean, I know that in Chicago, pretty much, these 100 year old houses need to have new electric, new plumbing, just a total, total rehab.

Mike Hambright: Right.

Jean Norton: I walk in, thinking $50,000-$60,000. You just get a feel for the area of what is going to be needed, but you still need to have somebody go out there and look at the property for you.

Mike Hambright: Yeah.

Jean Norton: Get the pictures that the real estate agents are not going to show. I love for somebody just to go do a video walk-through for me.

Mike Hambright: Yeah.

Jean Norton: I might have two or three people do it, and that’s easy to do also, now that we’ve got social media, my social networking. I’ve got about 6000 people in my Facebook group. If I come across a deal in Iowa, I bet I can find somebody in Iowa that’s willing to check it out for me.

Mike Hambright: Yeah. Yeah. That’s interesting. So, just because I’ve been stung a few times myself, I make it habit to go look at every house that I buy before I execute the contract. Now, we buy — It might be a little different for you, based on how you’re buying, if you’re buying through agents or off the MLS or foreclosure sites or auction sites and things like that, where you may have an option period or some period in there. When we’re buying deals, it’s: If I don’t take it right now, it’s gone.

Jean Norton: Right. No. I’ll buy it without options.

Mike Hambright: Yeah. Okay.

Jean Norton: As is.

Mike Hambright: Okay. Okay.

Jean Norton: But, I make sure my price is a good price.

Mike Hambright: Yeah.

Jean Norton: I make sure that there’s enough padding in there that if there’s a mistake, or I didn’t think about something, I didn’t see something, then there’s enough money in the profit where I can maybe go, maybe have to fly out there to see what’s going on.

Mike Hambright: Yeah. Yeah.

Jean Norton: I’ve had some surprises. Now, that’s why in Austin or in California, I mean, I would want to be here in Austin if I was going to do an Austin flip.

Mike Hambright: Yeah.

Jean Norton: Because you don’t have the luxury of an oops factor here.

Mike Hambright: Yeah.

Jean Norton: It’s just a tighter market.

Mike Hambright: Right. Right. Okay. Well, tell us a little bit about Rehabbing Remotely, in the sense of how you educate other people to kind of follow along and learn along the way.

Jean Norton: We take trips to different locations. The next one coming up is in Atlanta. We look at specific things. For example, Chicago. There are different levels of rehab that are necessary based on a location.

Mike Hambright: Yeah.

Jean Norton: Chicago, you have to rehab to the max. I don’t care if it’s in the slums, the south side of Chicago. They’re expecting granite and stainless appliances.

Mike Hambright: Yeah.

Jean Norton: In Bakersfield, I didn’t hardly ever have to switch out the cabinets, just paint them over, make them look nice, and just make it a clean, livable property.

Mike Hambright: Yeah.

Jean Norton: And in Miami and Florida, same way. I don’t have to bring it up to the super duper standards. We also talk about some of the “Gotcha’s”, some of the things that will surprise you. For example, Atlanta. What are the biggest problems in Atlanta that we need to watch out for? What is most likely going to be an issue? That might be like termites. They might have termite problems. I know in Austin, we’ve got foundation issues.

Mike Hambright: Yeah.

Jean Norton: In San Diego, it was like cracked slabs were the worst thing. So, we talk about sinkholes in Tampa.

Mike Hambright: Yeah.

Jean Norton: Yeah. So, we talk about those types of things and explore exactly what’s needed and what to expect.

Mike Hambright: Yeah. Yeah. Now, with your experience as a new investor that just dove in a few years ago, and a lot of folks that I know that have done well in this business, where failure just wasn’t an option, where they had —

Jean Norton: Yeah.

Mike Hambright: You came from the corporate world, and I know it sounds like you were tired of that lifestyle. My wife and I did, and we were too, tired of that lifestyle. We wanted to take our destiny into our own hands. At the time, we had a less than one year old son, and just, failure was not an option, just flat out. Plus, our opportunity cost was high of continuing to stay in the corporate world. So, we couldn’t dabble. It’s like, it had to be — You had to be successful. It just, there wasn’t — But, there’s a lot of folks that struggle to get out of the gate and just — They have an interest, but not backed into a corner enough or committed enough to where they didn’t burn the boats, maybe. Let’s say. But, what do you think was the difference for your success? And then, what do you think keeps a lot of folks from every really getting out of the gate?

Jean Norton: Well, I think I’m pretty hard-headed. Sometimes, I hear people say, “Well, my agent told me I couldn’t do this.” Well, I wouldn’t accept that. I mean, even though I do have an agent that will still tell me, “You can’t do that here, Jean.” I’ll go back, and I’ll validate. I’ll talk to other people. I’ll find out what’s the truth. Yes. For me, failure was not an option. Now, I think a lot of people don’t realize that if you’re in real estate, that if you are a real estate investor, you are an entrepreneur. And if you don’t fit the mindset of an entrepreneur, you’re going to have some difficulties.

Mike Hambright: Yeah.

Jean Norton: If you want to be in real estate and are not an entrepreneur, you’re best bet is probably a buy-and-hold rental situation.

Mike Hambright: Right. Right.

Jean Norton: So, that’s one of the things that I like to do too, is talk to people and find out where their talents are, what is their mindset, and then just try to find a path that works best for them.

Mike Hambright: Yeah.

Jean Norton: Are there problems? Yeah. What happens when you come across a brick wall? How are you going to push through it? Can you think of multiple exit strategies? Things like that.

Mike Hambright: Yeah. Yeah. What do you think — One of the challenges, as you said, you went to a boot camp type seminar.

Jean Norton: Yeah.

Mike Hambright: A lot of times, the seminars are either, in my experience, very narrowly focused. “This is exactly how you do this, and that’s all we do is this.” Or, “Let me teach you one million ways to generate leads for houses.” For the narrow focused is dangerous, because you need to have multiple tools in your toolkit.

Jean Norton: Exactly.

Mike Hambright: The broad strategy is paralyzing because you’re like, “Okay. Well, what do I do tomorrow?” I know you’ve shared a lot of experiences from things like that. What do you tell people? Or what do you recommend for folks to not get paralyzed through either of those channels?

Jean Norton: Just know that the market’s always changing. Keep up to date on what’s going on. Like I said, if real estate strategy isn’t working for you, you’ve got — Or, if it’s not working for you, you have to change your location or change your strategy. And you’re right. I went to a very narrow seminar. “This is how you do it. You follow my system, and you will get rich.”

Mike Hambright: Right.

Jean Norton: Well, that worked once.

Mike Hambright: Yeah. [Laughs].

Jean Norton: I followed this system, and I made money.

Mike Hambright: Yeah.

Jean Norton: There was no turning back. I really had to make this happen. But then, I couldn’t get another deal. So, what do I do? I did buy another program that had all these 15 different ways, and I looked into them, and I dabbled. I sent out some postcards. I tried to do some of these other things. It’s just a matter of always being open and always learning, and be ready to adapt to changes.

Mike Hambright: Yeah. Yeah. Through your program, do you offer any coaching yourself? I know you’re teaching other people. But, are you looking to do it in ways to where you find partners for deals or people to bring you leads? Or coaching programs that you offer yourself? Or maybe everything? Tell me a little bit about —

Jean Norton: I’ve been trying to come up or think about a coaching program with a small group of people. I just haven’t gotten my act together yet.

Mike Hambright: Yeah.

Jean Norton: But, I am available to coach people if they want. There’s a lot of people out there that are willing to help. I look at you and me and all the other people, as we’re all educators, and we are all — We collaborate. We don’t compete. You’ve got the opportunity. People who are watching this have the opportunity to work with who they know, like, and trust.

Mike Hambright: Right.

Jean Norton: I’d be glad to talk to anybody if they wanted some mentoring.

Mike Hambright: Yeah. Great. Great. So, how many of the — I’m sure this changes. But, the Rehabbing Remotely, the trips that you do. Are you doing those a few times a year?

Jean Norton: Yeah.

Mike Hambright: How often are you doing those?

Jean Norton: Yeah. A few times a year. I’ve been in Chicago and Florida lately. I’ve got Atlanta coming up. That one’s going to be a little bit different, in that people will be invited to invest and do projects with us. That’s new. I’ve never seen anything like this. I’m really excited about that. We’ll see how that one goes. So, that’s in April, and then I’m really active still in Chicago and Florida. So, I want to hit those two places again.

Mike Hambright: Is it always in conjunction with you working a project there? Or —

Jean Norton: When I hold a field trip, that kind of gives me an excuse to go see my project.

Mike Hambright: Yeah.

Jean Norton: [Laughs]. I mean, I can go anytime I want.

Mike Hambright: Right.

Jean Norton: If I didn’t have a field trip, I’d probably never see the project.

Mike Hambright: That’s more legitimate. Yeah.

Jean Norton: Yeah.

Mike Hambright: So, talk about how you rehab from a distance. I actually, personally, have a pretty good system in place here. It’s because I have a great relationship with my general contractor. I’ve used the same guy on the last hundred houses, and I don’t need to — He knows what to do because we’re going to do the same thing we did on the last 30, generally speaking. But, when you’re working from a distance, you’re dealing with new people, and you can’t see them. Talk a little bit about how you manage a project like that.

Jean Norton: Well, yeah. You can — It’s wonderful when you’ve got a great contractor.

Mike Hambright: Yeah.

Jean Norton: When I was in Bakersfield, my contractor would go through, and he’d be done with a project within ten days, two weeks. I mean, that was awesome.

Mike Hambright: Yeah.

Jean Norton: There was one time, we had to go back and revisit the color scheme that we want, and there was no problem. Then, I went to Chicago and hired a guy that just piddled and didn’t do anything.

Mike Hambright: Yeah.

Jean Norton: And piddled more and didn’t understand the market. Then, he finally left, left me in a lurch. I mean, that can happen.

Mike Hambright: Yeah.

Jean Norton: So —

Mike Hambright: That can happen, even in a market where you do live.

Jean Norton: It has happened in Austin, to me.

Mike Hambright: Yeah. Yeah.

Jean Norton: So, you have to depend a lot on references. Right now, I’m using somebody in Miami that I’ve never used, but he’s highly recommended from multiple sources, multiple rehabbers. But, this is the first time I’m using him. So, we’ll see how that goes.

Mike Hambright: Yeah.

Jean Norton: They sent me pictures of color samples, and I send them what I’d like back. It’s a lot of picture taking, a lot of spying.

Mike Hambright: Yeah.

Jean Norton: You send a spy out there to see how things are going.

Mike Hambright: Yeah.

Jean Norton: That surprises the contractor sometimes, but you got to do what you got to do.

Mike Hambright: Yeah. Yeah. They’ve got to know. It’s not — They’ve got to know that somebody’s watching them, I guess.

Jean Norton: Right. And I think it’s really good to solicit the use of a project manager.

Mike Hambright: Yeah.

Jean Norton: I mean, it might cost you a few thousand dollars to have them just check up every week or so for you, but that way, you know when things are going to start to go bad, and you can stop that from happening.

Mike Hambright: Right. Right. So, what do you — Do you have a process down? In terms of — And do you share that with other people on the Rehabbing Remotely site? In terms of how to facilitate, whether it’s agreements with contractors, payments, some checks and balances —

Jean Norton: Yeah.

Mike Hambright. To keep track.

Jean Norton: Yeah. I talk about never give a whole lot of money upfront.

Mike Hambright: Yeah.

Jean Norton: I’ve had — Even on this deal that I’ve got in Miami, I had to give more money upfront than I was really comfortable with. But, I still negotiated. I didn’t have to negotiate price with this man. I just negotiated what he got upfront and what he got at the back end.

Mike Hambright: Yeah.

Jean Norton: I wanted more reserved in case something went bad at the end.

Mike Hambright: Yeah.

Jean Norton: So, we talk about that, what to expect. What do you expect things should cost? What do you expect, walking in? You know walking in, that every house needs new paint, new flooring, new whatever.

Mike Hambright: Right.

Jean Norton: That’s the minimum.

Mike Hambright: Right.

Jean Norton: So, you walk in. You have a walk-in budget. Sometimes, you can be pleasantly surprised, but not often. [Laughs].

Mike Hambright: [Laughs].

Jean Norton: Actually, I do have one right now in Clearwater where I’m pleasantly surprised. The appraiser had actually said, “Don’t even bother investing any more money in this. You’re not going to get the return.”

Mike Hambright: Yeah.

Jean Norton: It was like, wow. Okay.

Mike Hambright: Yeah. Yeah. Great.

Jean Norton: Yeah.

Mike Hambright: Are there — Are you building a — I mean, I know you’ve built up your network quite a bit. Are you finding deals from other folks? Are you buying from other wholesalers and things like that, more than in the past? Say, as your list builds out?

Jean Norton: Oh, yeah. I love wholesalers, especially the ones that have to deal with the distress sellers. If they ended up getting a really good deal on a really good property, they are worth their weight in gold.

Mike Hambright: Yeah.

Jean Norton: They are worth whatever fee they get. I always tell people, “Don’t argue with what a wholesaler gets.” But generally, I’ve been finding my own deals.

Mike Hambright: Okay.

Jean Norton: So, I’m just an Internet researcher.

Mike Hambright: Yeah.

Jean Norton: Now, I don’t particularly like talking to the distress sellers. That’s why I leave that to the wholesalers.

Mike Hambright: Yeah.

Jean Norton: But mainly, what I do is I find a deal, and I’ll either see if anybody else wants it or wholesale it off, or say, “Hey. Who wants to join venture with me on this?”

Mike Hambright: Yeah. Yeah.

Jean Norton: So, I think a lot of that is my blogging. It’s been able to –People who don’t even know me have invested with me, because I put myself out there, and I share everything, the good and the bad.

Mike Hambright: Yeah. Yeah.

Jean Norton: So, I’ve been very fortunate with that.

Mike Hambright: Yeah. Yeah. So, tell us how folks learn more about — I know you have a blog where you have a lot of information and share your stories. So, tell us. Tell folks how to get to the blog, and then how they get to learn more about Rehabbing Remotely and trips you have coming up and things like that.

Jean Norton: Well, go to JeanNorton.com, and the blog is on that site.

Mike Hambright: Okay.

Jean Norton: And you can register for the newsletter, which also gives you a free e-book, which was my first two and a half years of real estate investing. A lot of people give me some really positive feedback, especially as they’re learning, and they see me go through what they’re going through right now.

Mike Hambright: Yeah.

Jean Norton: So, that’s JeanNorton.com. You can register for the weekly calls. I do them on Saturday. So, when you register for those, you will have access to those and the recordings.

Mike Hambright: Okay.

Jean Norton: Actually, the recordings are at RehabbingRemotely.com.

Mike Hambright: Okay. So, RehabbingRemotely.com. And tell us again, the trips you have that are coming up in the short term?

Jean Norton: I’ve got Atlanta, April 11 through 13.

Mike Hambright: Okay.

Jean Norton: That would be JeanNorton.com/Atlanta.

Mike Hambright: Alright.

Jean Norton: And then, I’m looking at Florida and Chicago, at least once, both of those before the end of the year.

Mike Hambright: Yeah.

Jean Norton: Yeah.

Mike Hambright: That’s awesome.

Jean Norton: Yeah. Weather and all that has to come into play too.

Mike Hambright: Sure. Yeah. Especially Chicago.

Jean Norton: Well, I was not going to step foot there in the winter.

Mike Hambright: Yeah.

Jean Norton: It’s been a horrific winter for them.

Mike Hambright: Yeah. That’s where I’m from. So, I’m from northern Illinois. So, I’m very familiar with — So, I think what you’re doing is awesome. I mean, I mentor and coach a lot of people myself, but I always do it in a way to where I’m just simply sharing my experiences. I don’t pretend that I’m all-knowing or anything like that, and I think that’s the best way for — It does two things. One, I don’t have to make up training, that, “Here’s how I teach somebody how to do something.” I just say, “Here’s how I did it,” or, “I’ve never done that, but here’s how I would do it.”

Jean Norton: Right.

Mike Hambright: And too, I think people learn from hearing about experiences rather than kind of the academic side of, “Here’s how you go do this or that.”

Jean Norton: Right. I agree 100%.

Mike Hambright: Yeah.

Jean Norton: In fact, I had one of those deals. Well, the one in Chicago, where the contractor just bailed on me. I mean, we ended up getting it done and probably made — Didn’t make the profit we had expected, but we were glad it was over with. I had one investor buddy say, “You know, if you don’t have one of those deals where you say, ‘Glad I got out of that one,’ then you haven’t been in real estate long enough.”

Mike Hambright: Yeah. Yeah. Yeah. Awesome. Well, Jean, thanks so much for your time and your insights today, and thanks for sharing all your experiences with the world. Hopefully, we can help share them with a world that doesn’t know you yet.

Jean Norton: Well, thanks.

Mike Hambright: And they can come learn more about you.

Jean Norton: Alright. Well, thank you so much for having me.

Mike Hambright: Great. Great. Have a good day, and good luck on your upcoming trip in Atlanta.

Jean Norton: Thank you.

Mike Hambright: Alright. Bye bye.

Jean Norton: Bye.

Mike Hambright: Thanks for joining us 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 at FlipNerd.com.