Buying Your First Income Property

Buying Your First Income Property

Riley's Website:

Buying Your First Income Property & 250% Returns on AirBNB - Riley Oickle

[00:00:00] Riley Oickle: I would like to share the idea of focus and I think focus is just so important when I, when I kind of began this journey with, with, like in terms of buying properties, I lacked so much focus and I was trying to juggle like five, six different like businesses at the same time. And I was spreading myself so thin that there was no way I was going to make any of them work. And so I guess my biggest takeaway here, if there was one in a, in what I recommend you do as a business owner is just be super, super focused, like laser beam focused on that one business and really crush it and do your best with that one business.

[00:00:54] Smart Money: I'm super excited to have with me an inspirational business leader, a real estate investment guru, and somebody who I think is young. But still very, very promising and will have a very successful career.

So I'm very excited to have with me, Riley CEO of Riley Oickle investments and your first income investment property program join us today to talk a little bit about investing in real estate and his journey. So, Riley, thank you so much for joining.

[00:01:19] Riley Oickle: Thanks, Ron. Glad to be here.

[00:01:21] Smart Money: Can you give us a small brief intro about yourself?

[00:01:25] Riley Oickle: Yeah, my name is Riley. I am from a Halifax, so Halifax, Nova Scotia, and moved to London, Ontario, went to school there at Western for a couple of years. Stayed back, ran a few businesses in London and now I currently actually live in Toronto. So. I've been moving up a good amount here recently and, own own investment properties in Southwestern, Ontario, and do live out of Toronto.

I unfortunately can't afford to buy investment properties in Toronto right now, but certainly love to, to buy properties in Southwestern, Ontario.

[00:01:55] Smart Money: How did you get into the real estate space? What did you study in school? Was this something you'd always thought of? Or is this something you sort of fell into by chance?

[00:02:05] Riley Oickle: Yeah, funny enough. I did not study this at all in school. There was no option for me to study what I'm doing right now in school. I actually took kinesiology, so I took like a health science course and, it certainly was not totally like in alignment at all with what I'm doing right now.

And at the same time I am very grateful that I actually went to school. I think that I learned a lot through that process. And then it was a great learning environment too, for me to just kind of grow up and be an adult. I guess the whole idea of like what school enabled me to do was it enabled me to be in such debt that I was, I was in this position that I had to work my butt off to pay off all this debt.

And due to that pressure, like, you know, I like to say pressure does make diamonds and you know, when you're 30, 40 K in debt and you're, you know, working at a $16 an hour job, you're like, I'm never going to get out of this debt. Like I need to, I need to do something different. And then I started to kind of think differently.

So I think school really prepared me for taking on immense debt and then being able to work my butt off to pay it off. And through that process, I did start up a business where it was a home maintenance company and that allowed me to actually go and pay off my debt. So yeah.

[00:03:16] Smart Money: Can we talk a little bit about what your experience was coming into this. You told me something funny, which was, you didn't know what assets were at one point in time and, and you had this big passion for environmental sciences.

I don't know if that's the right word, but you were passionate about making the environment better and you want it to go out and do something. So I love for you to share this story and how you learned what assets were in the first place.

[00:03:42] Riley Oickle: When I was at Western, I actually took a sustainability course and it taught, it taught us around, you know the different ways in which we can be more sustainable as species here on the planet and take care of the planet. And, I actually became very passionate about that type of topic and learned about, renewable energy and how that space is like a very big sector in how we can be more sustainable as a species.

So I really dug into renewable energy and a subcategory of that in terms of a method that we can use would be geothermal. So I noticed that in Ontario, there's very few geothermal companies. They kind of run like these vertical systems cause you can't do a horizontal, there's not enough, usually backyard space to do it like a horizontal system.

You'd have to go vertical straight down and to do that, you need this hydraulic drill. So keep in mind the context here is my business experience is going and running a window cleaning business where all you really need to run a window cleaning business is maybe $200 worth of squeegees and soap and just like very cheap stuff.

Right? So I'm like, okay, well the barrier to entry to run a businesses is obviously quite low. Like I'm like $300 or $200 for window cleaning stuff is pretty cheap. So going into running this new business, that I was really head over heels to run, being my new geothermal company. I created a logo, had had a name I'm like all set up and then I looked into the drill cost, like, wow, like that's pretty expensive.

I don't have $1.2 million for a drill and keep in mind. I'm like 19 at the time. So, you know, naturally I'm like, well, who has money? Well, the banks have money. I'm going to go to the bank and I'm going to see if the bank will give me a loan for 1.2 million. So I go into the bank and I'm speaking in there with their loan department and they say, well you know, Mr. Oickle, you need to have assets. And I'm like, well, what do you mean by assets? I'm like, well, I had my vehicle and my vehicle costs, you know, like Equinox, you know, right now cost $2,500. Like, will that be enough for you to be able to give me this loan? And they're like, absolutely not. You need, you need a home.

You need like a lot of equity in a property to like, shoot. So are you telling me I can't get this loan today? They're like not a chance. Like there is no way you're going to get this loan to buy this drill. So long story short, that really led me on the path that I'm on currently, which is going to learn more about investment properties and rental properties.

And, you know, I've been pretty successful now with buying these properties and accumulating assets. And my long-term vision here is really going to go full circle, hopefully to go and buy one of these drills or maybe multiple drills to run a massive geothermal company. And the more I learn about real estate investing, I think it'll always be a part of my business strategy in terms of investing.

It's really awesome, but it's kind of funny how I've gotten to this point. It's been really a mixture of having someone in my network early on that was really a guru in this space to start with. And he took me under his wing and mentored me for years, on real estate investing along with, this whole, loan fiasco that I was going down, trying to get this loan of 1.2 million and needed assets. And that led me on the path of like, learning about what assets were and how to get them.

[00:06:48] Smart Money: That's an amazing story. I love your passion for for the environment. Cause I think it's definitely important. There's only one earth and we got to do our best to protect it. And obviously renewable energy is the best possible solution as one, at least that doesn't have many environmental impacts, ideally.

And so I hope you are able to achieve your goal of buying that $1.2 million drill. And when you do, I want to see it because. That thing better be covered in diamonds. Let's talk a little bit about your investment properties. So what was your first one?

Can you tell us a little about, it was like a semi-detached was it a duplex? Was it like a side split? And then how did you go on, how many do you have today? How many have you helped people, acquire, give us a little bit of background.

[00:07:31] Riley Oickle: Sure. The first property was a single family property. So my mentor and I had actually just finished doing the renovation for the property, and we just basically went in and there was nicotine stains on the walls I remember. And it just, it, it was really, really gross.

Like it was just disgusting. And I was in there, like with brush basically with TSP, like a degreaser and just scrubbing the walls for hours and hours and hours and removing drywall taking out with the old moldy carpet in the basement, like it was just horrific. I'm like, I really don't ever want to probably do this myself again.

I want to actually hire, hire this piece out, but that was my first experience. So I was on the job site. I put in some, some elbow grease there and some sweat equity is what we like to call. It did a bunch of work and we flipped the property around. So it went from really being this like hoarder hosts that was like really distressed and about to to probably like fall apart too, like this really nice, like three bedroom property in Sarnia, and now it's being rented to this like great family that lives there. And they've been there now for about a year and a half great tenants. And yeah, so that was my first experience. So it went really well, but then I kind of looked at okay.

Okay. Well that was a single family property. What if I bought a duplex or triplex or fourplex? And, and, you know, like I think the margins just still look a little bit better with the residential multifamily properties, like the two to four unit properties. So that's really what I did then for the last couple of years, it's been focusing on buying two, three, four unit properties.

Yeah. And in terms of how, how I've kind of gotten into the space of helping people to buy their first property. When I started off on this journey, like three and a half years ago, or so it was just. It, I, I became very frustrated, like to buy my first property and it took me forever to actually go and buy that first one.

And I think the reason it was is just because the industry goes so deep and knowledge, and you can read all the, all the books that you want. You can listen to all the podcasts, you can watch all the YouTube videos that you'd like. And a lot of the information around real estate investing is pretty superficial.

Like you kind of get like a very broad spectrum of everything. Cause there's like dozens of different strategies and lots of different ways to make money in the industry and like I just think that there's a lot of information out there. And because of that, that's where people go through paralysis analysis and they get stuck.

They can't actually go out and buy that first property. And so, you know, I think that there was a big, like opportunity for me back then, when I had started to take a program or something, I just cut out all the noise. Cause there's a lot of saturation of knowledge here in the industry and just focused on exactly what I needed to know to buy my first property and nothing extra.

So exactly what I needed to know to buy that first property and nothing extra. And there was nothing like I'm looking around now on the market and there's really nothing available. So that's why I put together your first income property program for anyone out there. That's actually looking to buy their first property and is feeling annoyed.

You know, they're feeling frustrated because there is so much knowledge available and that can actually be a curse more than more than like something favorable in your, in your benefit. So due to that, that's why the program exists. I actually started off with doing what's called a joint venture where we'd actually go and we partner up and we'd buy the property together.

So I've, I've helped a good amount of people now probably close to a dozen to go to go out and actually partner up with me to buy that first property. And we go in at 50 50. I just found that my goal here, cause my big goal overall is to help a thousand people to buy their first property. And, back then, I'm like, there's no way, like there's no way I'm going to be able to help a thousand people to, to buy their first property.

Now I'm like, well, this is actually pretty, pretty realistic. I'm close to a hundred now. And I think within the next couple of years, I'm going to be able to reach that goal of a thousand though, using the vehicle of joint venturing with them just is not, I'm not going to accelerate that journey fast enough to get to my mission.

So what I started to do is actually help people online. So I have a coaching program online and that's where I actually like do it in cohorts of five and we're on zoom and we actually work together and we go over all the hurdles that they're facing to buy that first income property. So I still do the joint venturing where we co-own the property, but mainly I'd rather just not own a hundred percent of the or 50% of the equity. I'd rather just teach them online, how to, how to buy that first property. So those was a kind of the two methods that I use right now to help people.

[00:11:53] Smart Money: That's amazing. And I love the fact that, you want to give back. Cause I think you, you hit on a very important point there with analysis paralysis and it's the same problem that I think studies have been done around Netflix to show that sometimes when you have too many options, you can't make a good decision.

I bet we've all been there and scrolled on Netflix for like 45 minutes just to say, I'm not watching anything cause I can't decide. And it's, it's a little bit of a problem. I think it gets compounded when first of all, you're investing money, right? Like there's assets on the line in this case. And filtering that information is also very important because you're right I think there all the information is probably out there already. It's probably all available for free, even in those podcasts and in those YouTube videos, but to be able to find them and filter them is an impossible job. Right? YouTube gets a thousand hours of video uploaded a day or something. Like, it's unbelievable.

You, you would never be able to watch it all to know what's good. And so I love that you're giving that back and I love the 50, 50 I'm with you. It probably doesn't scale to a thousand people, but it's a very noble sort of endeavor because I think you're putting your money where your mouth is, right.

You're not telling the person, Hey, buy my course or whatever, get my coaching services. And then you put all your money on the risk. You're literally saying I will put 50 percent the risk on me and you put 50% of the risk on you. And I think that's the most, wholesome proposition that you can make.

I'd love to dive a little bit more on that first one though. I think people want to hear more about it. Cause it sounds like it was a pain in the butt. I mean, it sort of sounds like the window cleaning business, the $200 of squeegee set you up for success because you probably had a little bit of elbow grease experience to, to go and scrub, but how long was that project?

How much did you invest? Anything you're comfortable to share around that? I think the listeners would love to hear it.

[00:13:54] Riley Oickle: Yeah, I'm an open book. So anything you want to know I'll I'll dig in, but the first project, it was just a lot of work. Like, I don't know how else to explain it. We walked in there and this couple had been smoking for easily the past 50 years in the place. I just, nicotine stains everywhere.

We were debating like, do we rip out everything? Like, do we do a full gut, but then you kind of go in into the budget sheet and you're like, well, I don't think it makes sense to do that. Let's just like do our best to clean this up. And. You almost feel like you're trying to put lipstick on a pig at some point in time, and it's like trying to make this thing.

That's like, in, in really rough shape look good, like, so that at least then you can attract a good tenant. And we also want to be able to do a refinance in like the first year to two years of owning the property. So the place needs to be more valuable after we finished that renovation. So going into that property where like the carpet's in the basement, like there's mold on them growing to it.

So that's like a big issue with the wallpaper on it. It's just gross. Like, so all the wallpaper needs to be removed. I had never removed wallpaper before this project. And I was like, yeah, it's gonna probably take two hours. Like, there's a good amount of wallpaper two hours seems reasonable.

You're there for easily two days, like just removing wallpaper alone. Just a nightmare. It takes forever to remove wallpaper apparently. And I'm not a handy person. Keep in mind, like my biggest reservation going into real estate investing was what happens if there's like a clogged toilet. I don't know how to like unclog a clogged toilet.

Like I don't, I don't know how to do a lot of these things that you see people doing on HGTV that are flippers, right? Like I'm not that sort of person. And I'm sure I could become that person and spend more time in with the trades and learning in that space. But I just don't desire to do that. And, because of that, I just, I feel very hindered when I'm on a job site, like swinging a hand or a hammer.

And I missed the nail, like pretty much every time. Like it's just not good. So, so that's kinda what it felt like to be on this job. So I'm just trying to have you envision it. And so luckily we did finish it. We were about maybe a month over budget or a month, a month overdue. So it was supposed to be a three month renovation took us four months and we, I had around 50,000 to spend and we were, we were within that budget, which was nice. So that's kind of what we did with that project. Yeah, the first one, like, it, it wasn't that bad. Like I've heard of really bad horror stories of like people really overspending on their budgets or taking two or three times as long as they had expected. So I'm still happy with how it went, but it was, it was certainly a massive learning curve and I'd prefer never to go over that again, that learning curve again. Cause there was a lot to it for three months, but yeah, we finished it up all right.

[00:16:30] Smart Money: Yeah, that's perfect. I guess the first question that would come to somebody if they're thinking of buying the first income property is like, how much money do I need? So how much did you put in for the, like the mortgage? Did you do the 20% or did you go for CMHC insurance and put even less? And then, because you talked a little bit about budget, anything you're comfortable to share around budget that you can.

[00:16:52] Riley Oickle: Great. So, so keep in mind, this is a single family property and it's in, it's in Sarnia. We got for, I think it was just, it was under 200,000 at the time and we put in 20%, so I was in it for. I think with the closing costs and everything, it was like around 40,000. I think it was like 180,000 is what we got it for. And then the renovation cost was like, we were 25, 30 grand into the renovation costs. So overall for that project, we were, we were just shy of like 55,000 is what the, the initial kind of contribution was. So the initial investment between the closing costs, the down payments and the renovation was around 55,000. And that's pretty typical. Like a lot of the people I work with, they have around 50,000 saved up before they buy their first property.

[00:17:38] Smart Money: Love it. Yeah. And so in Toronto, obviously 50,000 won't work, but that makes sense. I think that's a good starting point for people. So $50,000 will get you through closing costs, buying the actual mortgage or paying them for the mortgage as well as some renovations it sounds like. Can we talk about the cash out refinance where you guys successful in that? How much of that money were you able to pull back out for the next project?

[00:18:02] Riley Oickle: Yep. We were able to pull out the entire amount. So everything that we had initially contributed, plus an extra 10,000.

[00:18:08] Smart Money: Wow in one year. So what was the timeline on that cash out?

[00:18:12] Riley Oickle: A year and a half, yeah.

[00:18:14] Smart Money: Nice. And so now this property pays for itself. I'm assuming the family covers the utilities plus like, what is the arrangement you guys have? We don't need the specifics, but in

[00:18:24] Riley Oickle: So every month, every month that actually cashflows around $700. So for a single family, that's pretty good. I was happy with it and we're going to probably keep it in the portfolio for quite a few years.

[00:18:34] Smart Money: Wow. That's a, that's an amazing property. Where are some of the areas that you're looking at nowadays? You mentioned you, you like the math on the duplex triplex and quadplex a little bit better. Is that primarily where you're looking now or are you still looking into single families and what are some of the geographical areas that you're interested in?

[00:18:51] Riley Oickle: So after that single family, we really focused on multi-families multifamily, residential specifically. So two, three, and four unit buildings. And so the geographical area was London. So I have a lot of contractors and team members out in London and they will drive within an hour outside of London. So we focused on St. Thomas. We focused on a bit of Sarnia as well and then Chatham. So those are kind of like the satellite townships that we were focused on outside of London. So those are, those are still our main focuses when it comes to like the multifamily residential space. And we are looking to buy like a larger building this year around 15 units or so in one of those cities.

And at the same time now I've actually transitioned into more Airbnb investments. So we're, we're up in the Kawarthas right now. And like we found that there's a big demand for a certain type of property. W with certain features as well on Airbnb. And we're really capitalizing on that right now. So we're looking to buy a couple of airBNBs right now.

We're working on one as we speak. And it's a lot of fun. It really is because we go in there and we're treating it like an investment property of course. So every dollar that we put in, we want it to equal at least a dollar 50 out. So we're doing a lot of strategic renovations, but we also get to furnish the property, which I'm not used to with the long-term rentals.

You don't usually furnace something, but for an Airbnb, you're going to furnish it and make it look nice and have cool amenities and features like we have a hot tub and a sauna at the one Airbnb, and it's just a lot of fun to work on those projects. So that's what I'm doing now. And I'm actually starting to coach people like a very small group of people on, on how to do that as well because Airbnb investment is a more strict or a more complicated strategy, I would say as it be like as a beginner, I wouldn't recommend using an Airbnb investment strategy, but after you have like maybe three, four properties under your belt and you're more advanced an Airbnb strategy is actually a really great way to, to make some serious cashflow.

[00:20:39] Smart Money: I'm curious how you find the margins. Obviously with Airbnb, there's some aspect of unpredictability, but putting that aside, like, let's say you get your desired tendency rate of 20 days a month or 15. I don't know what the exact is, but let's say you achieve your tenancy rate. Do you find them more or less profitable than a traditional long-term rental?

[00:21:03] Riley Oickle: I think the answer here is like for an Airbnb, if it's done really well, if you find it in a really good area, you find the property discounted. So, so below fair market value, you do really good strategic renovations. You furnish the property, not with like, expensive furniture, but like you, you, you furnish it very inexpensively.

Like I love Kijiji. I love Facebook marketplace, secondhand furniture and whatnot and furnishings for an Airbnb is perfect. And you don't hire like an expensive designer, like you just do the designing yourself on Pinterest. No, there's lots of ways here to hack the system and make sure that you are really optimizing the property without overspending.

If it goes really well, like on this property, like I've never seen these numbers before, but we're expecting over 250% return on our investment within one year. It's just crazy. Like the numbers really do. I like to say that they break because you don't see that with the long-term rentals. And and I, I think it's, it's really because if we were to look at this single family property, it's a six bedroom that we just bought in the Kawarthas.

If we were to rent it, long-term, it's like 27,000 a year. On Airbnb we could easily get North of like a hundred thousand plus in a year or so like that, that's pretty awesome for like, just, you know, when we put in maybe like 35,000 or so into the property. So to get like a return of like a hundred thousand or two to do a hundred thousand of like income that year is like super, super good.

But Airbnb allows you to do that. Like you can rent things out right now. And for six, seven, $800 a night for a six bedroom. Cause people from Toronto, especially, they just want to get out. They want to go and do a staycation or go and get out of the city. And there's a huge demand right now for Airbnbs.

[00:22:40] Smart Money: That's amazing, I guess, just to clarify, cause the, that initial investment seems low, the $35,000 investment covered the mortgage and the closing costs, or is that after the cashout refinance?

[00:22:53] Riley Oickle: We were able to do a 5% down for the property. So because of that, we were able to do around 35,000 and then the renovation, you also have to keep in mind, like, you know, the renovation was maybe around 70, 75,000 for the property. So we're, we're putting in a good amount for the renovation, but we'll expect to get that out on the refinance after within the year.

Yeah. Yeah.

[00:23:15] Smart Money: And so I'd love to hear we don't, we don't have a lot of. People that come on here that have talked about this or any light that you can share around the CMHC insurance. Cause I personally have been on the view and maybe this is a little bit different for an investment property versus personal property.

But when I did the math, it made the most sense to pay 20% unless you, unless you went to 5%, but I guess when you ran the numbers, You know, how often do you do the CMHC insurance? When did you find that make sense to put 5% versus 20%? Are there additional sort of, I know there's additional fees involved with the CMHC, but are there additional things that people should think about when it comes to like assets? Like when you went to the bank for the first time, are there are certain things that are different with taking a CMHC covered mortgage?

[00:24:06] Riley Oickle: That's a great question. Well, I'm not a mortgage broker, so this is more of like a mortgage broker question, but I will answer it from my perspective as an investor. So when we're looking at, like, let's say a $500,000 property, so the very quick math here. So if we were to do 20% down, how much do we have to put into the property?

So now we have to contribute 20% of 500,000. So it's a hundred thousand dollars that we need to put in for the down payment alone. And that's without CMHC or without insurance coverage, because we're doing 20%. But when you go below 20%, then you have to pay for insurance because the banks deem that to be a bit more risky when you're putting in less skin in the game.

We're going to put in, let's say 5%. So if we're putting 5% of 200,000 or half a million dollar property, 500,000, we're putting in 5% of that. So that's $25,000. So, you know, in option A we're doing 20%, which is a hundred thousand dollars down. And option B, we're doing 5%, which is 25,000. The spread there's a $75,000 difference that I'm putting into a property.

That's very significant. So I could either have that 75,000 sitting in my bank account making a return every single month, or I could have it in the property, but there's really no difference whether it's in the property or not in the property. There is like a very minor difference, but not that significant. CMHC when that comes into play, if that isn't money that I'm putting into the property, it really isn't.

And this is kind of the misconception that 3% extra or whatever the fee is for CMHC, it's usually 3% or so of the purchase price. So for buying the property for a half a 1,000,000, 500 thousand 3% of that is 15,000, that 15,000 isn't coming out of my bank account. That's actually just being topped rightup onto the mortgage.

So now the purchase price of the property is 515,000 or so. And so what that means is that the bank's giving me 95% loan to value. So they're contributing 95% and I'm contributing 5%. So that 15,000 I'm only contributing 5% of the 15,000. Where is the bank is attributing the other 95%. So 100% of the time I will always put in a lower percentage.

I'll always do the five or 10%, whatever the banks will allow me to do. The lower amount I'll go with. 20% is like, kind of in my worst case scenario, when I'm looking at investing. And so yeah, the CMHC fee, it shouldn't scare you. It's really not a big deal. It just really gets right. Like it's topped right up onto your mortgage and you're not ever paying that directly out of pocket.

You're just paying it like a small percentage of that for your loan to value amount that you're contributing.

[00:26:37] Smart Money: I love that. I think the only thing to note there is an asterix and I believe. The amount might be changing. They're always going over it, but CMHC is only possible for properties under a million dollars in value. I believe, unless the rules have changed as I bought a property in December and that was still the rule.

So works well in Kawartha but in Toronto, when you're buying a million dollar house, you have to have 20%. That's the unfortunate reality. And so that's part of why I believe investing in sort of Southwestern, Southwestern, Ontario, as you called, it makes more sense because you don't have even the option to get CMHC in Toronto on a million dollar property. And so it makes a huge difference. Like you said, putting down 25,000 versus putting down a hundred thousand dollars, that's 75 grand will make a huge, that's the cost of the renovations. Right?

I'd love to ask you what are some of the books that you'd recommend people should read, who are looking to learn more about this?

[00:27:34] Riley Oickle: Absolutely. So if people are looking to learn more about real estate investing specifically, I would say the gateway drug for a lot of people here at the beginning is Rich Dad, Poor Dad by Robert Kiyosaki. So that's a pretty classic book. A lot of my students, when they start working with me, that's one of the prerequisites they need to read before we actually even start the coaching. Just opens up people's eyes, usually to the idea of of the power of investing and that's really help people become rich and wealthy. So that's a really great kind of entry-level book. Then when you're looking at actually getting more of the fundamentals. A great, great book is by Stephan Ernie.

So Stephan Ernie wrote a book called money people deal. So it really refers to the idea that there's about three different components when you're putting together like a, an income property. So one is like, you need the money. Of course, the other component is you need the people. And then the last component is like the deal, which is the actual property itself, but finding a good deal, like an under optimize property, you know, that needs a lot of work and it's distressed. That's the type of idea that we're talking about when we're referring to the deal. So overall that's kind of what I look at is like that those three components and every property that I want to buy, I'm always thinking, okay, where's the money coming from?

Who are the people going to be that are going to help me with this property? And then where am I finding the deal? And so that's a really great book. Yeah, those would be the two main ones that I'd recommend.

[00:28:52] Smart Money: We've talked a little bit about distress properties. I've heard, you mentioned them multiple times. Have you noticed one of the things that I know a lot of people are talking about right now is during COVID right. The construction prices have gone up because material, especially lumber is through the roof.

I believe it's almost doubled or tripled. And a lot of trades people have a very long backlog of work. So, you know, how have you found it? Have you found it harder to do renovations now during COVID or do you, is it because you have a team you find, you know, you can weather the storm?

[00:29:23] Riley Oickle: It is challenging. I'm not going to lie like right now, like we have a project where. We had the shingle, a roof, and it's super, super critical that we do it right now. We bought the property with the understanding that we had to do the roof within the first couple of months, because it's so distressed. There's pretty much holes that you could see like through the upper floor, so you can see multiple holes in the roof.

So for us to replace the shingles right now is going to cost us twice as much. Like it was going to be a $10,000 roof. And now it's a $20,000 roof because of these shingles. And were, were a lot of the, the larger companies before. Before it was too late, I guess they went out there and they just bought a bunch of the shingles.

And now there's like a, a deficit or a lack of supply of shingles on the market. So because of that, the price of shingles has risen. So your, your kind of traditional, like lower tradesmen that didn't jump on and, and stockpile, a lot of these shingles. Same idea with the lumber too, like you had mentioned, or, or toilets and bathtubs as well.

Like it's really across the board for a lot of these, these heavy hitting items, even windows, right? Like windows are more expensive now in back-ordered. But what they did was they stockpiled these items. And unless you have one of those contractors on your team that actually has a big stockpile of shingles or windows or whatever in their warehouse, it's really difficult to actually find something for a reasonable price right now.

I do have, I have a few of those connections where people actually did the stockpiling and now they just have this stuff and they're willing to give, so you know charge me at a wholesale price for the items. But if you were to go into like a home Depot or any, like, larger box store that you are going to be paying like a serious premium on a lot of these items.

And a lot of like just the lower a lot of the, the beginner contractors also just don't have a lot of the, the items that are stockpiled. So it is more challenging. Yeah. Without a doubt.

[00:31:08] Smart Money: And so how have you seen that impact? Both in terms of the, I would say sort of like the mentorship and course piece, and then how have you seen the impact as far as appetite in the market. Like, are you seeing more people buying properties for investments? Are you seeing less people? And are you seeing more people interested in it or no?

[00:31:31] Riley Oickle: Oh, on the coaching side, a lot of the coaching I give around renovation and which properties you should renovate, which you should not really comes down to like permits. Like I don't think that the permit process is very friendly. For the beginner investor, like for your first property, I would avoid permits like the plague or, or like COVID or whatever we want to say now, you know, avoid it completely.

So anything structural, anything foundational, just stay away from it. It, it really becomes a nuisance and it can become a money pit too. It can really suck up a lot of your finances extremely quickly. So I would just stay away from all of that. And when I'm coaching my students, we actually work on. What I call strategic renovations and it's very cosmetic strategic renovations.

So like laying flooring, painting, maybe redoing a bathroom or a kitchen, like very, very simple things. Like a bit of landscaping. None of that is really affected that much by the, the lack of supplies that we're facing, because they're not going to be ripping all the drywall, all the insulation, redoing the framing, anything structural, they need like, like a two by four or something inside of a property.

Typically if you take a two by four and you put it into a property for the structural to, to support the property, you're going to need permits. So they're not really affected that much right now, I find, but for anyone that's doing a full gut job and they're completely redoing the entire property, all the structure like a bunch of the structural and foundation components of the property, you're going to probably need to budget that out a lot differently than you had pre COVID for sure.

And that's kinda what I'm facing right now is like when we're budgeting for renovation, it's just extremely expensive. So we need to be as granular as we can with the budget spreadsheet and make sure that we're not just going off of our experience from last year, the year before, but what are the prices right now? Because things are changing so rapidly.

[00:33:21] Smart Money: I think that's some great insight for people and I love your comment about avoiding the permit, like the plague, because I've had some experience and I, I echo that sentiment and I know that you've had a lot more experience with that. So Riley, as we wrap up, I'd love for you to, to share, you know, a 60 second clip, a piece of wisdom that you'd like to leave our listeners with.

It can be anything from life advice, business advice, inspirational, motivational, you know, what are you feeling right now based on this conversation that you want to put out into the world?

[00:33:54] Riley Oickle: I would like to share the idea of focus and I think focus is just so important when I, when I kind of began this journey with, with, like in terms of buying properties, I lacked so much focus and I was trying to juggle like five, six different like businesses at the same time.

And I was spreading myself so thin that there was no way I was going to make any of them work. And so I guess my biggest takeaway here, if there was one in a, in what I recommend you do as a business owner is just be super, super focused, like laser beam focused on that one business and really crush it and do your best with that one business.

And once you are the dominating, once, once your dominating your market or just like one of the top people in that market then? Okay, well, let's look at building up and let's, let's go to that. next thing and that next thing and that next thing versus just like, yeah. You know, I've, I've the shiny object syndrome, which a lot of entrepreneurs do because they're they're visionaries and they just want to go out and innovate And sort of all these cool little ventures that they have in the back of their mind that they're thinking of at 2:00 AM, you, know, laying in their bed like, Oh, I want to start that business tomorrow and that one.

And, and so due to that, I think that's the really that's the downfall for sure. But it's also the benefit at times of an entrepreneur and a business owner, but it tends to be the curse of a lot of people is saying yes all the time and just going all in on like multiple different ventures at the same time at the beginning, especially.

And that's, I think the ruin for a lot of entrepreneurs and business owners is doing two or three or four businesses at the same time when they haven't even accomplished mastering the one business yet. So. Just be super, super focused, be patient as well. Patience is key and I lack a lot of it, and that's my struggle time to time.

It's just being very patient and and, and look at the long-term, right? Like this is a marathon we're not running a sprint here. When you're a business owner, it's a marathon and be prepared for the, the, the endurance that that does kind of that that arises here when you're running a business, because you're not going to become rich overnight.

You're not going to become rich over a year or two. It's going to be five, 10, 15 years in a business because it is so competitive right now.

[00:35:58] Smart Money: I love that. And you, you hit a note there for me with the being patient. Cause I struggle with that too. I think it's something that comes partly with age and I think partly with, with more experience. So I I'm confident that you will figure it out and I hope that I will figure it out too. So Riley this was amazing. Where can people find out more about you and your first income property program and anything else?

[00:36:24] Riley Oickle: Sure. Well, they can go to my website. So it's just my first and last name. So And there you can learn about the coaching program and the joint venturing and everything that I do for the investing business. If you just want to connect with me as well, you can go to my Instagram or my Facebook.

So it's out Riley Oickle investor and and yeah, I'd love to connect with anyone. If you have any questions at all, please reach out. Don't hesitate and yeah.

[00:36:49] Smart Money: Amazing. And as always, if you'd like to learn more about investing real estate and personal finance, please check out Thanks again for joining us.

[00:37:01] Riley Oickle: Thanks for having me.

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