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House Hacking 101: The Magic of Duplexes

Crazy stuff is happening in our economy today, including big bank collapses. A lot of people are freaking out, but I’m happy to be here. Having multiple streams of income and working for myself allows me to follow the opportunities and adjust during times of crisis. Wealth and money never disappear, they just transfer. One thing I love about real estate is that whenever something’s not working in the market, that means something else is. Jim Park is doing something really cool with vacant land: he’s buying up property and putting duplexes on them. He’s pre-selling them and there’s a huge demand, especially in Florida where he’s most active.

Jim started out back in 1994 in California as a mortgage broker and he had a nice run in the industry. When the market crashed, he burned out and started to focus more on digital marketing. Jim eventually got into the duplex model and has been seeing massive success with his strategy. Jim and I discuss how his strategy solves both investor and buyer problems in today’s market and why there’s such a huge demand for duplexes. Right now, there’s a small window of opportunity and it might be the perfect time for you to jump in.

Watch and Learn:

Listen and learn:

What’s inside:

  • Jim’s house hacking strategy with vacant land and duplexes.
  • Why there’s so much current demand for duplexes.
  • How to get in touch with Jim for more info.

Mentioned in this episode:

Download episode transcript in PDF format here…

Joe: What's up, guys? Joe McCall here, Real Estate Investing Mastery Podcast. Man, what a beautiful day it is outside. Seriously, it's 32, cloudy, cold. But I love Mondays. I love, love, love Mondays. I hope you do, too. It's just a great day to be alive. It's a great day to be in business. People are freaking out about what's going on in the economy. You know, the other day as we're recording this, some big banks collapsed, you know, But so what? I am happy to be here. I'm glad you are here. I mean, I shouldn't take that lightly. It is a big deal. But that's why I love working for myself, having my own business, having multiple different streams of income. Because when the economy gets bad, I'm not freaked out about it because I can adjust. I can see I follow the opportunities. Money just wealth doesn't just disappear. It transfers. And whenever there's crisis, there's great opportunity. And I want to just and challenge you guys if you're getting scared and nervous or freaking out about what's going on in the world today, you need to take a chill pill and everything's going to be okay. It really, really is. And that's why I love real estate, because when there's one thing in the market that's working, maybe something else isn't. Things go through cycles and things change. The cheese is always moving, and that's why you're here listening to this podcast. That's why you watch YouTube. That's why you listen to podcasts. That's why you join masterminds and get coaching programs because you want to stay on top of what's working today so you're in the right place. That's my whole point, right? Glad you're here. And one of the things are going to be talking about today, I have one of my friends on the podcast. His name is Jim Park, and we're going to be talking about what he's doing is doing something really cool and unique right now in this type of a market with building, buying vacant land and building duplexes on them. But he's pre-selling them and there is a huge demand for this stuff. It's pretty cool. And so we're going to be talking about it because it's a unique strategy that you might not have heard before. It's something that you can start doing. You could maybe even work with Jim if you wanted to or do something like this of your on your own as well in your own markets. I'm excited to talk about this. When Jim was telling me about it, I thought, Man, this is so cool. I want to get you on the podcast and talk about it. So without much further ado, let's bring Jim on, shall we? Hey, Jim, how are you doing?

Jim: Good, Joe. Thanks for having me.

Joe: Man. Glad you're here. All right, so you've got this cool thing going on in Florida. Talk about your background. First of all, you're mortgage broker or. Well, yeah, you do a lot of different things, but I don't want to steal your thunder. What do you what do you do?

Jim: Well, you know, I started doing loans back in 1994. That's when I first funded my first deal. And there was no subprime market. So, you know, we had a big run until 2008. And then prior to that, I opened my own mortgage brokerage in Pleasanton, California. And from '01 to '08, you know, we're printing money, just printing money and doing well. I opened an office in Miami, Florida, in oh five, and then that office did well. So I had a nice big run the mortgage industry. But at the same time, I also diversified in real estate because I knew that if you're going to do loans, you also have to control the real estate part of it. So we had acquired a real estate franchise back in Pleasanton and we did mortgage and real estate, so we did that for about you.

Joe: So when you say about a franchise, is that like a realtor broker franchise?

Jim: Yeah. So in California back in the day, a real estate brokerage license allowed you to do mortgage and real estate. Okay. So with one license, you could do both. Okay. So I thought, well, you know what? I'm already doing deals for, you know, other agents, but a lot of times I preapproved the loan and the deal would not close because they wouldn't write the contract properly. So I bought a franchise called Realty World and I brought it in-house. So I hired agents and whatnot. And it was a good run, you know, get the leads, get the client and then get the property and so on, so forth. Market crashes. Oh, wait, didn't want to see another application in my life. I was burnt out, made a lot of money, and I was like, I'm done. So what's next? Well, there's a thing called Facebook. And I thought, you know what? The biggest problem I ever had was getting the phones to ring. We had a outbound call center. We would call, call and get the applications. But I thought if I ever go back into the business, I'm going to really nail this part. So I got rid of the mortgage and real estate, put on hold and then became a digital marketer. So from 2011 till now, been really good at digital marketing in the lead to come in and so on, so forth.

Joe: Was would you sell the leads to another company then, and what were you doing with those leads?

Jim: Yes, I had an agency, so my main focus, the business, they had hired me, pay me monthly and I would drive them leads and, you know, get their phones to ring. I just didn't want to do loans and mortgages anymore. I was burnt out. Yeah, I so I was like, no more. So then COVID happens and we get locked down. I'm like, Man, I kind of want to get back in the game. But two things had to happen. I'm like, I had to get to California and I need to get. React to my license. So in November 2020, we moved to Florida from California, and that was a faith walk in itself because people are live in California, don't ever think of leaving. So so we're in Florida. I get here in central Florida, Joe, I look around, I'm like, oh, my gosh, look at all this vacant land everywhere, you know? So I'm in Orlando area, which is Orange County, and there's over 100,000 vacant parcels just in this Orange County. Well, that was news because California, there's no vacant land, you know. So I was like, this is incredible. So I look back and I go, you know, in the early nineties, I remember the Bay Area had a boom, a tech boom and land was cheap. And, you know, that's when the migration happened. Well, almost wait in central Florida, same thing. And then I come across, you know, I'm like, okay, I see all this land. What do I do with it? And I mean, Joe And then I come on board and I'm like, Oh, my gosh, this is genius. So then I started going through everything. I'm like, But I got to be different. I have to be different. I cannot be the same guy flipping land, which is a good business model, I think, you know, but how do I differentiate this? So I connected with a handful of people that at the short term everyday, and then I really became good friends with a bit.

Joe: You broke up a little bit there. You connected with some I'm sorry you broke up a little bit. You connected with some people who do short term rentals. OK, Airbnbs.

Jim: Yeah, because that's where I thought this was going to go because Orlando, there are 75 million people that fly into this city every year because of tourism. Disneyworld, cruises. Literally 75 million people fly it. So that's what I focused on. I was going to go Airbnb and I was going to flip these properties and go on and go that route. Well, it turns out that the rules in terms of regulation of short term rentals, most parts of central Florida is not as stringent as California. So I befriended a builder and I said I said, I have a great idea, why don't we acquire this land and let's build a duplex and then pre-sell it? That's exactly what the big guys are doing. When you go to buy a new home at the airport, you don't just walk into a model home and go, Hey, I want this house. And they give you a house. No, you have to put a deposit down and then they build your house in nine months. I was like, Let's do this. But on duplex model because I knew rates were going up. So my background, the mortgages, I knew there's no way the ten year bond market is going to stay where it's at. And I was like, for this, the work rates has to go up. Sure enough, it really started going up. And then the duplex model kicked in. Why? Because most people that try to buy a single family residents are not qualifying right now because if the rates were 3%, you could buy X amount of house, but now rates at 7%, you don't qualify debt to income ratio, you don't qualify.

Joe: Yeah, it's really important to understand this. This is what really got my ears perked up. You know talk about the debt to income ratio like before a year ago when interest rates were at 3%, now they're at 6% plus the debt to income ratio. The interest rates went up. Right. But the debt to income ratio limits limitations didn't go up. Is that right?

Jim: It actually decreased because now there's more risk. So Fannie and Freddie said, hey, we're going to. Yeah. So they said we're not going to take as much risk. So you have to have a lower debt to income ratio. They made it tighter.

Joe: Okay. So what does that mean? Somebody means that means that somebody a year ago who could afford a $500,000 house can now only afford maybe a $300,000 house or something like that, right?

Jim: Correct. Yeah. So a $500,000 purchase now dropped to about 380. Yeah. Okay. Well, that changes the game because the prices have been dropped. Mm hmm. So if the price is having drop, it does. Inventory is still low.

Joe: Right. So when they're looking at debt to income ratio, they're also looking at what kind of house can you afford. So a mortgage payment on a $500,000 house a year ago might have been total pity. I might have been $3,000 a month, something like that. Right. But now the mortgage payment on a $380,000 house is about the same entire it's well, or it's a little higher now. Right. So the house prices are not going down. So enter in the duplex idea. So explain why duplexes solve these problems now for so many not investor buyers, not just short term, short term rental people, not Airbnb, but also the regular retail buyers. How does this fix that? What is what is that? What happens?

Jim: Well, there was a big problem in the market. Rents didn't come down. Okay. So the rents were still high. But now people can buy a house because now the debt to income limits are too high. Well, how do you solve problem? Well, you build a duplex because if you build a duplex, I can live in a three bedroom, two bath on one side, rent out the other side. And the 2000 that I'm getting on that rent now, I qualify.

Joe: Yeah, because. So give an example then. You know, if you build a duplex. Well, we're going to run through some numbers, I guess, in a minute here. But how much of the total duplex mortgage payment is covered by the rent of the other side?

Jim: Well, we can allocate 75% of rents. Mm hmm. Okay. So if my rental income is 2000, then I could allocate about, say, 1400 of that to count that as income.

Joe: That's huge.

Jim: Huge. That allows me to go from a renter where rents continue to skyrocket. Now, I became a property owner in a duplex. Okay. So that in itself, I asked my builder, Hey, no one's doing this right now.

Joe: It's almost like I just ran some numbers backwards. That's almost like adding 40 to $50,000 in an annual income.

Jim: Bingo. There you have it.

Joe: Know what I'm saying? It's almost like adding another part time, full time job to your income coming in. If you take you know, I just took the that savings. Well, anyway. Yes, but go ahead. What were you saying, Jim?

Jim: Yeah. So that's all two problems. Number one, you know, the millennials right now that they want to buy a house, but they can't because they have student loans and they're barely making the debt to income limit anyways, even when rates were at two and a half, 3%. So they were barely making it. It's not like it was a slam dunk approval. Yeah. Okay. So now rates are at six and a half, 7% their way out of the limit in terms of ratio. Well, guess what? My whole philosophy is this. I truly believe a primary residence is a liability. It is not an asset. It's not because you put in a down payment, that money's tied in there. The equity that's in there. The only way you can get to it is to refinance or sell. And due to the increase in the standard deductions, you don't even get to write off that mortgage interest like you did before. So I took a liability and made it an asset because if I can live in one unit, have the second unit as a rental to cover my mortgage and have that part of the building depreciate as a rental, it's like a double bonus. Yeah. Yeah.

Joe: So you could you could even turn that other half into an Airbnb short term rental or mid term rental. Everybody's talking about mid term rentals now. Right. And so you can furnish that and get even higher rents than you would normally with a normal rental rate. And one of the advantages to being in Florida is they're so Airbnb friendly that it's a lot easier to do Airbnbs and there's still a huge demand for them, right?

Jim: Yes. Huge demand.

Joe: One of the advantages to being an FHA or a normal retail regular retail buyer is you can buy that as and live in one half as and the other side is being is your investment property. But how long can you do you have to live in that property? Do you have to live in there for the next 20 or 30 years? Can you move there?

Jim: No. You just have to live there for 12 months. That's it.

Joe: OK. So in 12 months, go out and then do an Airbnb or mid term rental on both sides.

Jim: Right. So there is a problem with that, though, because if I move out after 12 months, where is that person going to live? Okay. So I was like, I'm not going to just have someone go and go rent again. Right. So we have a program where you can do a lease option. Now, the way lease options work is we work with a hedge fund. They pay cash for a house. You're leasing the house from the hedge fund for five years, a five year lease option. So you move into that new house. The hedge fund paid cash for it. Therefore, you get a best price on that house. Now, you just moved out of a duplex that's getting $2,000 each side now. So now you have five, $4,000 of cash flow coming in. You get to move into a lease option that the hedge fund already paid cash for. And if you decide to live there, then you have five years to exercise the option on the price of 2023, even though it may be 2028.

Joe: And so are hedge funds still doing this today in Florida?

Jim: All day. Now, more than ever, because the banking problems are like we need to go double down on real estate. They're doubling down on real estate. But it has to be strategic, though. They're not doing single family anymore. They're not doing that because there's too much out there. So what we're doing is we're saying, hey, look, I've got people that we're building duplexes for. They're probably going to live there 12 months because, I mean, no one really wants to live in a duplex anyways. Right. So they got in at 5% down for the most part. They move out. So they have a double source of revenue on the duplex, which is brand new, by the way. These are new construction. These are not fixer uppers. That's going to cause a problem. Brand new construction. Okay. So then we give them a way out so they can move into a new house with no money down, because now it's just the regular lease options you just got to come up with first and last month's security. Now, a year from now, they're like, I don't like this neighborhood. I want out my worries. You just move out because it's a lease option.

Joe: Okay.

Jim: So I got that entire system from A to Z structured to solve this big problem we have. You know.

Joe: Here's the cool thing about this, too. You're just the middleman in a certain sense, right? You're doing this as an investor and as a mortgage broker. I think, since you're still on that site and as a realtor. Right. Because you can get some commissions on this. So talk about this because you're finding this land for super cheap. And a lot of this land is already zoned for duplexes. Right. And you already have the plans designed for these duplexes that have already been approved in the local municipalities so they can get approved. New construction can get approved very easily, right? Yes. All right. So then you're. How much how much are you buying this land for right now in these areas?

Jim: All right. So this this is where this is where it all comes together. In California, this doesn't work because a quarter acre of land is about $1,000,000, even in not part parts that aren't good here. There's so much land and there's so much growth that outskirts of the main city, we're getting a quarter acre for about $15,000. Okay. Okay. And these are properties that are.

Joe: By the way. Let me let me interrupt you there, Jim. I'm buying that land for two or $3,000 because I'm doing marketing director sellers. Right. You're talking about you can buy this land directly on the MLS right now for 15, $20,000, correct?

Jim: Yes. Okay. Now, when I incorporate your amazing system, we're sending out letters and stuff we're going to acquire because we need more land. Now, I got I got a huge database of people that want this. Joe On a side note, I did one campaign. I think I showed you the list or I did one campaign, and I said, Hey, New Yorkers. Florida is booming right now. Get your opportunity to build a duplex, move in one to rent. I did one social media campaign. I got 380 people that said, I want in.

Joe: Okay, so what you're doing here is so cool. You're finding the land, which is easy, whether you're going direct to seller or you're going on the MLS, you're finding the land very easy, already zoned for duplexes already you've got the plans designed for these duplexes and maybe we can share your screen later. You can show what these kind of duplexes look like. They're very nice. So now you're finding the investor buyers and the retail buyers that are buying these things do either live in them or rent both of them out. Is that right?

Jim: Yeah. So a lot of success I'm having right now are investors that go, Hey, how much is it for the land? 15,000. How much is it for you to build this? I could build this for about 350,000.

Joe: Like, okay, let's write these numbers down the permits. So you're buying the land for 15 grand, right? And then you're building the duplex for 350, is that right?

Jim: Correct. Okay.

Joe: What were you going to say about permits? Yeah.

Jim: So that 350 includes permits all the way to a certificate of occupancy from A to Z. And these are brand new duplexes, three bedroom, two bath on each side with a garage branded.

Joe: Three bedroom, two bath with the garage. How big is each side?

Jim: It's about 1200 or 4000 square feet, depending on the layout.

Joe: OK, and it's Florida. No basements, right?

Jim: No basements. And then speaking of that, the places where buying people say, what about hurricane? Well, in central Florida, you're not you're not going to get a direct hit. So the insurance premium is about the same as Southern California. I was surprised because State Farm has a rating system and based on claims. So even when Hurricane Ian hits, we just get, you know, a tropical storm. We're not like bombarded.

Joe: OK so what are these things appraising for?

Jim: Well, we just sold one. We sold one with no comps. We just started this. And usually when you sell a duplex with no comps, that's the lowest it's going to be because no one's going to pay top price when there's no comps. Right. We just closed one on December for 460.

Joe: 460 grand. So you're looking at about $110,000 in gross profit equity in these deals, right, when they're done.

Jim: So now the other project, the other four duplexes we're building, we already have a pre contract at 550.

Joe: Okay. So it's like pre-sold. You've pre-sold these things for 550. Who's buying them at 550?

Jim: Remember, this is where the digital marketing skill came. The two things I needed were I needed land and I needed buyers. If I have land and buyers, everything else takes the risk. Right? Yeah. Yeah. So I did a campaign in New York and New York and Florida. I mean, there are people just coming here in droves from New York.

Joe: Oh so you did like a Facebook ad campaign in New York selling these not even built yet duplexes?

Jim: Correct. Okay. I have a buyers list, over 350. I have to pause the ad.

Joe: So are you selling like an option on these things or is that a an actual contract? What is it that you're selling?

Jim: I'm doing exactly what DR Horton. Pulte. I'm doing the exact same thing. Those guys do exactly the same. Hey, guys, here's a model. Here's four lots. Here's how much it cost to buy this duplex. But I need, you know, this much down payment, just like if I go and buy a new home at the airport. So they're already used to buying houses this way, Joe. So it's not like. Is this a scam or. No, This is how they're buying new construction.

Joe: Nice. So then is the buyer getting a construction loan to build this?

Jim: So the buyer has come in with 100,000. Okay. They have to come up with 100,000 and then either have a private lender, hard money lender that will come up with the remaining 250 to finish the build that cost 3/5. Okay. So the investor is really happy because they're in contract at 350 plus 15. So they're in this at 365. Right. Well, they already have a buyer at 550.

Joe: So. So you're buying this land for 15 grand. You're finding a buyer, an end buyer before you even start construction on it. Yeah. That 550, all these things. And for that end buyer, that's a good deal still. They're getting new construction, right? They're getting new construction duplex and they can rent out both sides or rent's going to be, I don't know, double what it would or the normal residents would be in an area where there's strong demand and very easy as city allowance for these kinds of Airbnbs, short term or mid-term or long term rentals, however you want to do it right. And they're the end buyers putting down a $100,000 into these things. So your private investor then is coming up with about 250 grand for the for the construction. Right?

Jim: So the end buyer that's paying 550 only has come a three and a half percent down. Joe. If they decide to live in it, they only have to come three and a half percent down FHA and we put that loan together for the person that has to put 100,000 is the investor on the first phase, the one that wants to build this at 350, they need to come in with 100 also.

Joe: I see you're adding in another party there. This is good. I'm glad you're clarifying this. So you're bringing in a private investor. A private investor? Mm hmm. That is. Okay. And then they're going to flip it.

Jim: Correct.

Joe: To the end buyer who's either a retail buyer living in half of it or and another investor buyer is going to be renting both sides out.

Jim: Correct. So I have two clients on one deal.

Joe: All right, So who do you have? So you're acting as the mortgage broker or the realtor broker for both? For both at the beginning. Correct. Nice. Okay. So could you could you just. Do you have to have that middle buyer in the middle? Couldn't you just go straight to the retail buyer at the end?

Jim: You could, but most people don't have 100,000. I mean, if they do that, we don't need the middle guy. But from just, you know, the leads are coming in. So, like, I don't have 100 sitting around. Right. But what also helps me a lot is the middle guy, the first investor. I like working with them, too, because we flip it because I'm a broker. Right. So I listen, flip it, and then we can 31 exchange it so that the taxes are deferred and not realize that the sale. So the investors like, Hey, give me two more of these. So then we get two more lots and get two more new builds and then I get it on the market as a retail buyer, three and a half percent down and it's going like hotcakes right now. All right.

Joe: All right. So talk about then clarify what are the profit centers for you as the investor doing this?

Jim: So right now, where I'm coming into this is I wanted to create a case that I could have done this by myself, put 100,000 down. But I'm like, no, I need to scale this thing. And I'm licensed to do both. And I have a full on team. So I thought, Well, let me just be the middleman. Okay. Let me be the guy that brings the investor to the builder. So I get a little cut on there, and then I get the 6% commission on the listing, and then I get the mortgage. Okay. So right now I'm basically working as a mortgage broker and I'm a real estate broker. So that's where I make it on my revenue. But after we call after 50 these where I'm not doing any more of these after five, okay, we got four in the pipe right now. So I've got about 46 to go. Once I get the 50, then I become an active investor because now I've proven a case study I've created in the market and that's where now that's where your land thing is going to really blow up, because now we're going to spend five, $10,000 in terms of mail and get all these lots right now that are not on the market at 80% below what's on MLS. Yeah, Yeah. So that's going to be the fun part once I get the 50. That's why whoever's watching this, if you want to get in on this, okay, Joe, I'm sure reach out to Joe and let me know if you want to be the front end or the backend.

Joe: Let me get your email address or your phone number if you want. If people want to contact you to get more information on how this strategy works. What is a good way to reach you Jim.

Jim: Email's Jim at park place lending dot com. So Jim at park place lending dot com that's direct email.

Joe: I think I got it right there. Is that correct Jim at park place lending dot com. Cool. Is there another way.

Jim: And then they can also call me at 305 849 7151. They can call me or text me that number.

Joe: Got to put that number up there as well. 305 849 7151. Who gives away their phone number anymore anyway?

Jim: Yeah. Well this is such a hot product right now and it makes sense for everybody. Yeah. And one final thing. If you want to really get a hold of me, then here's a joke. Can you put the calendar link? It's www.MeetJimPark.com.

Joe: Meet Jim Park dot com. Is that it?

Jim: That's it. I want to be on both of our calendars. And I tell you, I've been doing this for 25 years, Joe. I have not seen an opportunity like this because everything is lined up. The rates are high, You know, the lease is high, everything is high. But we have an opportunity Where? The land here in Florida. Oh, my goodness. Yeah. Never seen it like this.

Joe: Yeah. This is so good. And could you maybe bring up one of the pictures you have of these duplexes? What they look like? You just go to their share screen or present, I think in the stream yard tab there. Do you see that?

Jim: I do. Okay, Let me see here.

Joe: Yes. I'll just repeat the email address. And if you're listening to the audio podcast, we'll just we're just going to show you in a minute here what a rendering of one of these duplexes look like with the floor plan or something like that. And then, Jim, I wanted to ask you just kind of repeat the numbers go through an example of how this typically works, but Jim's email is Jim at Park Place lending dot com. His phone number. You can call him or text him is 305 849 7151 or you want to schedule a call just get on his calendar go to MeetJimPark.com. I think this is really good opportunity because again, like he's saying, with the interest rates going up like they are, people are having a hard time meeting the financial requirements and the ratios, the debt to income and the well, the debt to income is the main one, right? It's getting harder and harder. But when you can live in a property and rent out the other half, it's this whole house hacking thing that people have been talking about for years and years, or you're an investor in New York or California and you want to buy. Where else can you buy number one property land so cheap? Number two, where can you build duplexes affordable? Where you can rent both sides out in a friendly Airbnb municipality in an area that's friendly to Airbnbs and short term rentals, or do mid-term rent a lot. And if you want, it works. It works really well. What you're able to get that. I see it here, Jim. Cool. It's added to the stream. What are we? Shrink your screen a little bit so it fills up more and maybe we can zoom in. You understand what I'm saying? There. That's good. Perfect. Ah, So show us what we're looking at here.

Jim: Okay, so this. This is a duplex model that we got approved. Pretty much three city has given us permits, like within 60 days of application, which is unheard of. Okay.

Joe: And so what is this here, though?

Jim: This is this is a duplex that we're building right now.

Joe: Okay, Well, it's already built.

Jim: It's already built. Okay. Okay. Yeah, it's already built. So one side is three bedroom, two bath, and the other side is three bedroom, two bath. They all have a garage and it's I don't have the other renderings, but the insides really matter. Okay. You have modern kitchen and open floor space. These are things that if you get a tenant, they're not going to leave because it's not like your apartment, you know, it's a nice little duplex. But as an investor, you can buy this one. And I don't know if I mentioned this or not. The big builders haven't caught on to this yet. The D.R. Horton, the Pulte, they haven't caught onto this yet. If they do, then this is going to change the game because they can build this in masses. I don't think they're going to see this for another 3 to 5 years. Right.

Joe: But just so I'm clear, this is not a duplex and we're looking at there. Is that just a single family home?

Jim: Oh, it's a duplex. It's divided by a shared wall right here, right in the middle.

Joe: Maybe I'm looking at a different thing. I just see a single family home.

Jim: Oh, you know what? You're looking at Zillow. Okay, My bad. Yeah. I don't know how to share this. Yeah, you're looking at it. That's all right. Oh, no wonder. Yeah, No, that's.

Joe: I apologize. I threw. I threw you threw a wrench at you and I. I should have asked you in advance, and I was just pulling this up. Guys, if you have any questions, please type them in the Zoom chat or the YouTube video here, and we will. We'll answer your questions.

Jim: So, Joe, it won't. Let me share because my Google security thing. But I can I could send you a picture. But anyway, it's a duplex divided by a shared wall. And. You know, you can do one or the other. But you know, what's interesting is that there's been half duplex is being sold. So these numbers do. I couldn't believe it like if you if you go on MLS they're selling the builders are building these duplexes kind of like how I'm doing it but they're selling this half duplexes. Hmm. Guess how much they're going for right now?

Joe: I have no idea.

Jim: I have a duplex right now that’s going for 320 just for one side.

Joe: That's crazy. All right, so run through the examples. Some people are asking some questions are, can you do this in other markets outside of Florida? But run through the numbers one more time so like we can see how much is it cost to build? Who are you getting the money from? Who are you selling it to and who's making the profits where? So that makes sense.

Jim: Yeah. So we get the land and then we write a contract and then they pay cash for the land. 15,000. So. So then now the investor has agreed to build this duplex. So they, you know.

Joe: The investor is I'm sorry, the investor is buying the land. You're not buying.

Jim: Correct, the investor's buying, not me. Yeah, so the investors buying it and then they're going to build this duplex for 350,000. They come up with 250,000, they come with 100,000 down. And I gave them a private lender for the other 250. So in nine months it goes from the permits to certificate of occupancy.

Joe: Just it's unclear to me because I want to make this so braindead. Simple. Anybody can follow it. You're acting as a middleman, kind of as it were, maybe as the realtor broker in this deal. Then you're finding the you're building you're creating the opportunity then, and you're not using any of your own money doing this. Okay, good. Now you're finding the investor buyer. You know, it could be somebody from bigger pockets that wants to be, you know, they got some money, they want to land, they want to build, but they want maybe some more safety and security to know that they're building something not so speculative. In other words, they're building something that there is a huge demand for. But you're putting together, you're bringing together here's some land, here are some pre-approved plans and drawings, permits, you know, in the areas that have already been approved for zoning, this type of thing, so that in private investors then putting out the money to 100 grand down. Right. And then you're putting in the builder, you're bringing them the builder that will build this thing. Right. Okay. So then where does the money come for the construction?

Jim: That's where I line up the private hard money. That's what I come up with, the construction loan.

Joe: OK so you come up with the construction loan, and just like in any normal construction, there's draws that money is sitting in escrow or somewhere. And as the project is being built, the money is being withdrawn to pay the contractor.

Jim: Correct.

Joe: And so that extra money for the construction comes from a hard money lender.

Jim: Yeah. So we have a by the way, if there's other people on this call, they're looking to you know, they have excess money sitting on the sidelines and want to be involved in this. They don't have to be part of the transaction. They could be a private lender and say, hey, look, I will fund the remaining 250 on some of these projects and get 13 to 14% for 12 months. I see. Yeah, right. So whether it's institutional, private money, that's how we're getting the rest to build the property.

Joe: OK cool. Yeah. And so then the how long does it take to build these duplexes?

Jim: We're going from literally deposits to 60 days for permits and 7 to 8 months. That's it for, for completion.

Joe: Yeah.

Jim: I mean, here in Florida, in California, it'd be possible here, it's like if it fits within their parameters, it's like stamp, stamp, stamp, build, build, build. Yeah. So we have a proven model here.

Joe: Tons of people are moving into Florida as well. If you haven't seen that, it's the fastest growing state in the United States right now that in Texas, those two states. Yeah. Okay. So then then what happens? The hard money lenders lending the money. Now the construction's happening.

Jim: So then the investor, we ask them, Hey, do you want to buy and hold or do you want to flip it? Okay. And some are saying, Hey, I actually want to buy and hold. So if they want to buy and hold, then I provide what they call a take out loan. So I pay off the private investor and give them a 30 year fixed and they can do whatever they want with at that point. Okay. But some of them are like, well, got 50,000 equity already built into it. Let's flip it and get three more of these going. So that's pretty much we're all going with these right now. Okay.

Joe: So most of them are flipping them and they're flipping them to who?

Jim: To the end buyer that I put on MLS, the three and a half percent down buyer that can't buy a house now because the rates are too high. But now they qualify. Those clients are extremely happy. Nice. Yeah.

Joe: Okay. Now explain one more time. I just want to be super clear on how you're making money in this. Where do you profit from all this as well?

Jim: So in the beginning stages, the builder, when I bring them the deal, we get a small commission like finding the finder's fee. And then when I put the deal together on the private money financing, then, you know, we make a little commission there because we're putting the money together and then on the sale, I, you know, I get the listing, the list that the end buyer. Who's that? FHA buyer. Nice. So I make my money three ways along the way. Yeah. Yeah.

Joe: Beautiful. I think this is fantastic, Jim. I love this idea because there's such a huge demand for it, and it's not going anywhere. It's not going away any time soon. You understand what I'm saying? By the way, I apologize if you can hear all the banging. Can you hear the banging? I got I've got contractors right now on both sides of my office tearing off the gutters in the sighting, the facia and the soffit and replacing it all. And it's really loud right now. So we. We need to hurry and wrap this up. Yeah. Now, this is really cool. I'm excited about this. And Jim, people again, they want to reach you or talk about what it is you're doing, how they could do the same thing or partner with you. Lend money on deals, partner somehow. Jim at park place lending dot com. They can call your text you at 305 849 7151 or just schedule a call with you they can go here to this website, meet Jim Park dot com, review your calendar, schedule the time to get on the phone with you and talk some more. They want. Cool. Yep. Yeah. What else, Jim? Any parting words of advice here? Something you want to share that I miss anything that I ask. Should I've asked a better question?

Jim: No, I think everything was great, Joe. I appreciate it. But, you know, there's a small window of opportunity right now. And Joe, you know, in the beginning, when there's a lot of fears, when there's a small population that really take market share. And we know that recessions are always the times where you see people become multiple millionaires when everyone's fearful, that's when, you know, Warren Buffett said, right, go in and take market share and everything's lined up for this project. It's land in Florida. It's building a duplex in a market that is not only growing but will continue to grow. So you're going to be in a place where, hey, I'm glad I got a couple of these duplexes back in 2023 because now my net worth is much higher. So now's the time.

Joe: Yeah, well, the thing I love about this too, is we're not selling really high premium products where they're because when markets do go into recession or go down with the bread and butter middle, medium priced things, that's that I'm talking about here. Right. It's not the it's not Class C or D housing. It's not class A or B, It's right there in the middle and the sweet spot where most people can't afford to be. And so it's way less speculative because there will always be a demand for that price point. You don't understand what I'm saying.

Jim: They're right. And that's how we want the price of that way, because that's a bigger blue ocean. You know, marking the blue ocean is not the red is so much and there's three ways to fix it. You either flip, you either buy and hold and do a long term and short term or you live in one. So there's three major exit strategies that basically cover every need right now.

Joe: Yeah, I love that. I love that, too. Because again, when you start getting into troubles, when you only have one exit strategy and it has to go right for you to get out of the deal, this has different things that you can do with it. Exactly. Beautiful. Awesome. Thank you, Jim, so much for being on my show. Appreciate it, man.

Jim: Thanks a lot, Joe. I really appreciate it.

Joe: Guys, one more time. Email is Jim at Park Place lending dot com, 305 849 7151 Or just go to his website Meet Jim Park dot com and we'll see you guys later everybody. Oh we got some comments in here let's see if there's any questions Michael's asking. Are you only doing this in Florida right now?

Jim: Yes, only in Florida. It's a niche product. And, you know, once we get this part down, we can go to other states. But there's no way there's no reason to leave anywhere here but here. There's so much land. There's nowhere. You don't have to go anywhere.

Joe: Twin benefits, Health and wealth says, What is the minimum I can get in on this with? Could I just be the middleman with nothing down? If I have an investor or I want to live on one side? You understand the question there?

Jim: Absolutely. So that's really a good question. So if twin benefits wants to live in one side, then she could be the end buyer and then we she could be one of the end buyers of these duplexes. Okay. So it looks like she wants to live in one so we can do an FHA if she qualifies three and a half percent down, living one and rent out the other. And then she'll be one of the recipients of one of these duplexes we built.

Joe: Yeah. And you can live not rent free or mortgage free, but get there pretty quick, especially when you take in all the deductions and depreciation and if you pay it down rapidly. Yeah, it's a great way to build wealth. House hacking 101. Okay, thanks. This all the questions I see here, Jim, appreciate it. We'll see you.

Jim: Thanks, Joe.

Joe: Bye bye, everybody.

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