00;00;00;01 - 00;00;17;27
Unknown
It's almost impossible in a lot of areas to buy a cash building, long term rental. It's really hard in this rate environment. And after, you know, all of the depreciation we've seen in the market this last year, like it's it's challenging. You have to buy really deep and be really good to get cash floating real estate right now.
00;00;17;27 - 00;00;34;24
Unknown
And so I think that people are looking for ways to continue to invest in real estate, continue to buy, but not just have the capital appreciation side, still have the cash flow side.
00;00;34;26 - 00;01;00;21
Unknown
Welcome back to the seven Figure Flipping Podcast. I'm your host, Adam Whitney, and I have one of our amazing community members with me today, Ashley Coates. You'll notice if you're watching this on YouTube, her name says Mike and Ashley Coates because they're a husband and wife team. And, they're a really amazing, amazing team of, I'll say, real estate investors.
00;01;00;21 - 00;01;30;25
Unknown
Ashley, Mike, do a lot of things. One of the things they do is flip houses in California, and they're also residential care investors. And Ashley is amazing at that stuff. So I'm really excited to talk to her today. Ashley, welcome to the show. Thanks, Mike. See you in spirit. Sure. Okay, cool. Yeah. Mike's. Mike's. Brian and some of the brains on the Brian side, and Ashley's, the the brains.
00;01;30;26 - 00;01;55;02
Unknown
I, you know, the other brains. Business brains. So there's such a you guys are such a good team. Before we get into that, though, Ashley, let's talk about, your journey into real estate specifically. Okay. Where were you in your life? Like, what got you into real estate? How did that come to be? Yeah. It's always funny because people ask me that.
00;01;55;02 - 00;02;09;21
Unknown
And there was never really a time I wasn't in real estate. My mom was in real estate. My family was in real estate. And in, like, going way back when I was a kid, my mom had me do the open houses. She would have me set about the trade shows. I would sit there and watch her make phone calls.
00;02;09;21 - 00;02;27;07
Unknown
Her role was always. She would go to work every day, and she would call. Call until she had an appointment. And she never left until she forgot it. So, I didn't feel like. I mean, I took over her property management one until like 12. She had me doing all the contract, collecting rent, sending out notices, all the things.
00;02;27;07 - 00;02;50;01
Unknown
But it then ingrained into me. That's amazing. And when would you say the the switch turned on to where you were like, you felt like you were full time. You you had your business up and running. I mean, obviously we're always trying to get it better and refine it and grow it and all that. But there's a point in time in which we're like, okay, this is a real thing.
00;02;50;03 - 00;03;11;07
Unknown
Yeah. And it started out like I was I was a broker, a real estate agent. My mom actually passed away and am 16, and I took over her brokerage at that time, and, I did that for a while. We did loans. We did, you know, regular, you know, real estate transactions and stuff like that. I, when I turned 18, I got my, real estate license to maintain the brokerage.
00;03;11;07 - 00;03;30;26
Unknown
But then I did go through a path where I. I don't know if you did some soul searching, wanting to learn some things. I, I did. I was a, what account executive for a big mortgage firm selling mortgages before the big collapse. I did that for a while. I went to Edward Jones for a while and learned about, you know, became an executive selling stocks and things like that.
00;03;30;29 - 00;03;53;20
Unknown
So I kind of made my rounds. I actually even was a finance manager at an auto dealership for a hot minute. But after all of that, I just kind of came back to real estate and business as well. I bought a laundromat, and, I started just buying rentals, and I always making my brokers license that never gone away.
00;03;53;23 - 00;04;14;15
Unknown
And so it was kind of probably after then my stuff in data was boring. So 2008 that I kind of found my way back as this is, I knew this was me, that it was business, and real estate was always going to be my thing. I was never going to work for someone else, you know, it was cool to learn all that stuff, but it wasn't me, right?
00;04;14;15 - 00;04;45;27
Unknown
Yeah. Of course. It's like, we've got this, like, desire this. Like it's hard to work for the man. Especially when to. Most people work for the man for a while. They get a job and then they realize they want something more. Yeah. It's really cool that your mom was able to model that for you. And whereas everybody else does it, they're not exposed to that that entrepreneurship world because, you know, real estate agents are entrepreneurs.
00;04;46;00 - 00;05;10;15
Unknown
Yeah, especially the good ones. They understand it's a it's a business. Yeah. And she was super creative too. She wasn't just like your standard, you know, broker. She was always had her hands in other things. She was working developers on projects. So I got say like, I'm very young age, I got to, you know, go and see the model homes around the model homes, help people pick out the carpet and kind of see that development side, which is something I've always been super interested in.
00;05;10;17 - 00;05;29;17
Unknown
And then she was always working, you know, she had her list of private money, which I actually still have her binder with her list of all of her private guys that she cool, that she was always buying houses, you know, finding market deals. And so, yeah, she was super creative when I was doing so. And if you listen to the end, Ashley is going to give all of you guys that list of private money investors.
00;05;29;17 - 00;05;51;21
Unknown
I'm just kidding. Just kidding. Okay, so you you you get in, you do agent and broker stuff. Property management is you realize I'm assuming you're realizing, like, okay, the play is to get assets and build wealth, get some cash flow. Those things that I think are pretty common in our space. At some point you flip a house.
00;05;51;21 - 00;06;14;07
Unknown
So. Yeah. Yeah. Actually our a first split was I had just met my, we were barely dating, barely. And, South King off it was, I thought on having somewhere it was an off market deal, and it was actually a mobile home on land. And it just kind of was like, seems like a really good deal.
00;06;14;07 - 00;06;31;15
Unknown
Like, think we can make some money on this? And I just bought it. I didn't even ask. It's the only construction company. I was a real estate agent. I'm like, this could be fun. So, That's amazing. Yeah. We had been seeing each other medium like it was for intimate. And so we looked at that house and then it just kind of took off from there.
00;06;31;15 - 00;06;50;19
Unknown
And we really just as our relationship grew, which happened really fast and our kids molded and we just decided that I didn't, you know, we didn't love men having that you retail and working for other people and going. He was doing big apartment complexes and things like that. And it just it wasn't it wasn't good for the family because he was having to dig down.
00;06;50;19 - 00;07;08;20
Unknown
So much. So we're like, yeah, just do this. This was this was fun. Yeah. So you guys are such a powerful couple in combination. And I'm envious of Mike because he actually has man skills. I don't have any. So when I watch, you know, when I'm watching you guys on social media, my thing, Mike's doing all that I need to learn.
00;07;08;23 - 00;07;28;07
Unknown
So he's he's a super, super talented guy, which is a really powerful combination in terms of having the construction site bringing your business and real estate brain together. It's like almost a little, a little bit of a cheat code for you guys. Yeah, it's it's been really good. Especially now we have a really good team. Adam. Here's his truth.
00;07;28;10 - 00;07;47;06
Unknown
Phenomenal. So he doesn't actually have to go now. He does quality checks about twice a week on all the project. And sometimes you can get sick of doing the other things like, you know, all the computer work. He hates it. So there'll be days where it's like, I'm going to install cabinets and I'm like, looking at the list of things that need to be done or, you know, fallbacks we need to make.
00;07;47;06 - 00;08;01;23
Unknown
And he's like, let's. I mean, he was, installing that family. Okay. It's like therapy for him. He's like, I don't want to talk to anybody. I want to go and put cabinets in that. That's where it would be me, not you don't feel like you're doing anything unless you're doing it with your hands. So it's like, for sure.
00;08;01;26 - 00;08;23;13
Unknown
Yeah, it's it's a it's a, you know, it's a skill that atrophies if you're not using it. And, and when you enjoy doing something, you know, those are the things you often want to let go last in the business, especially when you're good at them because they bring a meaningful value to the business. The number one problem, outside of money that house flippers have is contractors.
00;08;23;13 - 00;08;47;08
Unknown
And when you have that experience and that is your world, that that that removes a lot of the, the uncertainty around what it should look like, what a contractor should charge you, what, how long something takes, like, you know, for a lot of us, like me specifically, like I have no construction skills at all. So when you say, let's get some LVP, install them, like, how long is this going to take?
00;08;47;08 - 00;09;03;24
Unknown
Like, can we do it? And the next hour they're like, no, it's going to take us the whole day. I'm like, why? Yeah. You know. Or they're like the opposite. I think it's a double edged sword. Sometimes, though, we talk about this a lot too, because sometimes I think our, our what length in the industry and our knowledge sometimes hold us back.
00;09;03;26 - 00;09;26;26
Unknown
You know, he'll see things and he'll overthink things or, you know, he'll catch things like we end up overdoing a lot. It's very hard for him not to if he knows it's wrong, you know, even if nobody else will notice he who he is, he can't wait. So, that that's it's a double edged sword. Sometimes it is a double net line, you know, but yeah, that's a fair point.
00;09;26;26 - 00;09;48;15
Unknown
That's a fair point. Okay. So in the last couple of years, how has the house flipping side of your business grown? Like what? How have you got that. Because you guys are pretty systematized. You guys have a solid process. I've been watching you process improve over the last year at least. What does that look like today? What's your team look like?
00;09;48;17 - 00;10;08;21
Unknown
Talk to me a little bit about that. So, obviously Mike runs the project management side, the actual execution. He has guys on his team. We do have some contractors that we work with as well. We have some really steady sons that are working great. Here locally, I kind of run the other side of it, although he's actually killer when it comes to talking to sellers like you.
00;10;08;22 - 00;10;30;03
Unknown
People love and and trust him. He's just that good Ole country boy, you know? So he's very trustworthy. Yeah. Any you drop your kids off to Mike and feel perfectly good about it, you just mention he has the worst poker face ever. He cannot like me. I can't lie, it's not possible. So he does really well on that side too.
00;10;30;03 - 00;10;49;03
Unknown
You and I do more of the, I do a lot of the, the marketing, like, Legion kind of stuff. I do all the underwriting as far as their views and stuff like, we have ATC, who's also a learning coordinator who's been with us almost two years. She handles anything to do with that link.
00;10;49;06 - 00;11;04;18
Unknown
I don't touch it until we're at a spread signing. Not do anything because I hate that stuff. That would bottleneck our business. If that was in my hands, I. It would take us months to build an iceberg. And I think I think going on obligations, all the acts. So she's phenomenal at that and that keeps that ball rolling.
00;11;04;18 - 00;11;23;19
Unknown
She handles all the drama request. She's an insane wizard at this point, so that's really cool. We use Astana for everything, keeping us all on the same page. We do weekly meetings, like real business meetings, even though it's just me and her. We also have a VA who's phenomenal, too. She's really good at just kind of keeping us on track.
00;11;23;19 - 00;11;49;17
Unknown
And she's great. Yeah. Even you and I were talking a little bit before this. I think there was a time in the industry and this is really big in seven figure flipping at the time. This was before, like, virtual assistants had become so prominent and like, I know our company blackjack, we were like 30 US employees across five markets, you know, 20, 30 deals a month and massive overhead.
00;11;49;20 - 00;12;14;23
Unknown
And what we've learned over the last three years is that you can build a more efficient and profitable business without having 30 people. Now, of course, there's, there is a capacity in that throughput. So, you know, and do you need to do more deals to make more money? That's not necessarily true. You could do deals with bigger margins to make more money.
00;12;14;25 - 00;12;33;04
Unknown
A lot of businesses have learned that lesson over the past, you know, two and a half, three years, I think, as the industry has tightened up and people to tighten up their staff, the shift we're making now, which, you know, since I joined in that amount of seven figures, it has changed a ton of our business.
00;12;33;04 - 00;12;51;21
Unknown
So we've kind of looked at everything and, and revamped our entire system, which has been great. And right now, like we've always only bought either on market word of mouth or wholesalers. But we're in such a small area, there's really there's really not any wholesalers. I mean, there's a couple, but not really. Nobody's actively marketing or a tiny little area.
00;12;51;21 - 00;13;12;29
Unknown
So, I think see your push over kind of be bringing that all in-house. So I've been working on that and getting ready. I want to make sure we're, you know, ready to handle all of that. But, but that's the next step in our business because we can find out a lot of, a lot of extra pay off that we were paying, you know, our average, you know, full sell off all the time.
00;13;12;29 - 00;13;30;07
Unknown
It and we can do better, you know that. So that's the next step in our in a real estate business. Yeah I love that. And just putting those adding that marketing and sales component to the business, it can be a lot. But at the same time when you and I talked you're there. You know markets are all different.
00;13;30;10 - 00;13;53;06
Unknown
It's not the same solution for everybody. And I see this a lot in our industry where, you know, we'll see somebody there doing something cool. But maybe they're in Indiana. I'm not in Indiana. I'm in Tampa. You're in California. Like what works in Indiana does not work exactly the same in California. And when I look at major metro over smaller metro, there's a lot of opportunity.
00;13;53;06 - 00;14;20;27
Unknown
In the smaller metro, you might have smaller population, but you don't have the same competition to your point. And when you think about how you win in this industry, getting the best deals and creating the most margin, it's the ability to source your own deals and obviously bring capital to those to execute the whole play. And I want you and I talked, I was excited for you because I was like, you, you don't even have to do that much to dominate your market.
00;14;21;00 - 00;14;44;28
Unknown
A couple of things and then get your brand to be the strongest brand there. And it won't. The marketing isn't just going to have a direct ROI, it's also going to people are going to know that actually, like, are the ones improving this town, right? Yeah. And you, you're not wrong. Then that's why I finally was like, okay, I heard I got it and that's more area and there's no reason we shouldn't, we shouldn't be doing.
00;14;45;04 - 00;15;01;27
Unknown
So yeah, I'm really excited for you guys on that front. And I'm, I just it's cool to watch you guys put things in play and continue to grow the business. Now you've got the active income with the flips you've got, you know, you've got some stuff in the portfolio, you've got the agent side stuff that can produce incomes.
00;15;01;27 - 00;15;24;19
Unknown
You've got these revenue streams which are typical, but you have something unique that you've actually been helping me with recently. And I think a lot of people are interested in it because it's kind of a fad strategy, maybe a shiny object to some, but it's actually really, really powerful and it's really, really purposeful. More importantly, you do residential care.
00;15;24;21 - 00;15;58;10
Unknown
Now you see this all over the internet today. Residential sets are living this big, this the silver tsunami, the big wave of, cash flow that's associated with this. Talk to me about your residential care side of your business and what that looks like and how you've grown that. Yeah. So, I've been in it since 2010 inch, I want to say, then a long time ago and, so I started out, I actually bought two facilities that were already up and running.
00;15;58;13 - 00;16;19;10
Unknown
I'm a really nice lady. She was just pretty burnt out. And, I think she she ran the business like so many people do. You know, she's a caregiver at heart, and, but not a business person. So she ran like a caregiver, which, you know, eventually burn her out. She was. She was done. And when the deal got brought to me from a local broker, I.
00;16;19;10 - 00;16;39;02
Unknown
I looked at it as a business I knew nothing about. There had never been a great provider in my life, but, it it was real estate, and it is the business, and it looks good to me. So that's kind of how I ended up in that world. And, then and we have the Paradise Fire cabin, which is local here to us, which displaced a lot of people that were in care.
00;16;39;04 - 00;17;02;09
Unknown
And so we at that time, I looked at my rental portfolio and decided to convert every long term rental. I had into care. And, so because of the neighbor. So they let us streamline it like we got, I was able to get it done fast. Fast forward for the for the audience real quick actually. Could you like what is residential care?
00;17;02;09 - 00;17;24;18
Unknown
What is that business like? Let's just, let's let's talk let's just kind of set the stage or what that business is, how real estate is associated with the business side of care is on it. And then we'll kind of. Yeah. Why somebody like why it's very attractive. So residential care can be like very different and, and, and I definitely reminisce through my program.
00;17;24;18 - 00;17;48;00
Unknown
But every state is very different. Even every county can be very different. But usually typically assisted living are more your big, big box. You know, the big home that everyone knows about residential care is more your small single family homes or larger single family homes, sometimes even multi-family, up to I would say like in California, they're up to six beds, but other places up to like 15 beds.
00;17;48;02 - 00;18;05;23
Unknown
Or there's even medium size. So it's a place where, people can go to retire or if they need, it once they're aging and need help with, you know, daily living skills or medication management or appointments, you know, they're just at a place where they can't live safely on their own anymore, but they're not in the nursing home by any means.
00;18;05;23 - 00;18;45;14
Unknown
They're still fairly independent. Yeah. So it's like it's it's it's a piece of real estate in some of the Marines as a piece of real estate that you meet certain codes you build it out to, to facilitate having care for elderly and the elderly side, the rents on that. And I'm thinking about you guys in California, where I talked to a lot of California, like we grew by rentals for equity or, you know, we know it'll grow in value in California, but you're not typically buying cash flow rentals unless you have some way to make additional cash flow outside of a short term or long term rental.
00;18;45;14 - 00;19;09;12
Unknown
And these things have good opportunities because of the amount you get. Yeah. So we keep it. We keep our model separate. We have the real estate side of it and then we have the business side. Our I owned our businesses and our businesses rent from us. We are able to usually the rents are I would say also double what you would do on a long term rental is what you would charge your business with that, with that model.
00;19;09;12 - 00;19;33;08
Unknown
So you were able to cash flow all of them cash flow really well. And then we on the business side of that as well, with operators in place so that I'm not actually in the business, I'm just running the business, if that makes sense. Oh yeah. That's that's really powerful. Okay. So you you bought you you acquire some from an operator, so you get an existing business.
00;19;33;10 - 00;19;58;07
Unknown
You then go, crap, this is really powerful. Let me convert my rentals into this because there's a much better opportunity. You convert your rentals. And the cash flow obviously goes up because it's a business. What happened after you converted your rentals? Well, Mike and I happened, and we flipped a house, and then we flipped another house, and then we were going to flip another house.
00;19;58;07 - 00;20;19;21
Unknown
But I walked into the third house and was like, wait a second. This would be a great facility. And it was just the way that that it needed to be renovated anyways and the way that it was set up and whether it was going to be a really great facility. So, I was like, let's, let's br this one, but instead let's bring into care in a facility.
00;20;19;24 - 00;20;40;05
Unknown
So we did that. And then another house came up, which I actually tried to sell this house to my brother. I tried to sell it to friends like it was a great house and nobody wanted this house. I couldn't understand it. I mean, it needed a full gallery. We went down to the stunt, but that's. But after actively trying to sell it to everyone I knew because I knew it was a great house, nobody would buy it.
00;20;40;05 - 00;21;02;10
Unknown
So we bought it. And it ended up we completely did a rehab on it. It's I think it's my it's my favorite facility that we have because we were able to go all the way to the start and build it exactly how I would want to go. The functionally it's it's gorgeous. It's also got an 81. So we've got two, two rentals and one plus a facility.
00;21;02;13 - 00;21;23;14
Unknown
Yeah. In that room the starting out. So that's kind of how that evolved. That and obviously like you don't go you don't you buy those. You see the opportunity, you start doing them. You see like this is for real. They continue to do this. You said this house makes a great facility. What what does make a great facility?
00;21;23;14 - 00;21;45;11
Unknown
Someone's, like, been thinking about residential assisted living. Residential care? Yeah. What what does a great facility look like? Yeah. So it is going to depend on your area a little bit. Because every, every like I said, every county is going to have different rules when it comes to especially fire. Like you're fire regulations and have control all when it comes to that.
00;21;45;14 - 00;22;04;26
Unknown
But there are some things that make anyone agree. When you're looking for, you know, at least a four bedroom, five is better. Six is phenomenal. Or if you're happened to be lucky enough to be in a state where you can do more than four bedrooms are great. Open floor plans on limited stairs, any at all is always great.
00;22;04;26 - 00;22;28;15
Unknown
Or stairs, you know, maybe it's just a step where you can easily get into a ramp. I always look at the doorways, make sure the doorways can, if they're not already, like REO doors, that you can open them up and take them through. I look at the factoring. Same thing. Make sure that there is enough space in those bathrooms to open them up so that we put the wheelchair in there and doesn't necessarily have to be, you know, your Ada compliant things like you see them stance.
00;22;28;15 - 00;22;46;01
Unknown
We're not looking for that, but enough room to where a caregiver could help someone in a wheelchair transfer to the shower and shower. And then we look for having good closet space because we like to, there's a few little things we like to set up in our facilities. I like to have a med room, rather than just a locked cabinet.
00;22;46;01 - 00;23;02;22
Unknown
I just it feels better. It allows, Biden's privacy when they want to take their meds to do it out in the open. They can just go in there and take their meds real quick. Easier to lock the, I look for, you know, big pantry space for easy storage. Who not not always nice. All those things are nice.
00;23;02;23 - 00;23;36;07
Unknown
Not required. But the the big doorways are really important. Stairs are really important. And then, looking for your ambulatory requirements based on your that. Yeah. That's I mean, that's a playbook right there. That's incredible. The other is as time is now trust me as he's been coaching me up as they talk about, when you hear residential care, you assume the medical profession doctors, nurses, can you talk about kind of the range of care that typically happens in these and why somebody might do one versus the other?
00;23;36;09 - 00;23;56;15
Unknown
Yeah. We don't you typically don't do any medical care at all. It's usually daily living skills care. If there's any medical required, most of the time you're, you're hiring that or outsourcing. You know, typically. Oh, not again though, every state can be different. So there might be states that have where you hire, you know, med techs and things like that.
00;23;56;15 - 00;24;18;11
Unknown
But most of the time you're not doing anything beyond first aid. Anything beyond first aid. Usually is outsource. You work or go out if someone comes in to help with that. And let's say I decided to distribute meds and outsource or do memory care, which you mentioned is a pretty common care for older folks. Yeah, that that does.
00;24;18;11 - 00;24;40;11
Unknown
Then obviously that comes with an expense. I've kind of hire outside medical professionals to facilitate that. That also comes with the higher rent for those beds. Right? Yeah. So you're giving you most of the time you're going to have your base rate and then everything beyond your base rate, will be an add on. And your base rate, it's going to really depend on your area.
00;24;40;13 - 00;24;57;19
Unknown
When we do a feasibility study in the beginning, when we have someone come in to our program and that feasibility study will they'll be dispatched, figure out what is your base rate and then what are your add ons, because every area is going to be different. Some areas always including hotness care, some area never included. It just it's very areas that they're back.
00;24;57;19 - 00;25;19;20
Unknown
And so you have to make sure you're building your program based on your local area. So you're not out pricing yourself or underpricing yourself. Yeah, I think that's super powerful actually. That's that's really cool. And where do you see now? It's become very mainstream. There's a lot of realness and real that and if it was easy, everybody would already be doing it.
00;25;19;20 - 00;25;43;10
Unknown
Obviously there's there's a lot of knowledge behind it. There's a lot of city, county, codes, and there's a lot of obstacles between you and starting a residential care facility. Where do you see this industry going from a residential care perspective? And why, why, why are we seeing a lot of real estate investors start to touch this industry?
00;25;43;12 - 00;26;07;19
Unknown
Okay. So those repercussion, I think that the industry is definitely growing. There's a lot of need out there. And the need seems to be shifting. It used to be that everyone, most people aging like the idea, those huge communities, which is why there's so many of the big ones and that is still very popular. But you're seeing a shift in families wanting, you know, they they realize that mom or dad can't live at home alone anymore.
00;26;07;21 - 00;26;24;04
Unknown
You know, it's not going to be comfortable to bring them into their home, but they also don't want to send them off to some big facility where they feel like they're going to get lost in the mix of 2 or 300 people or just wheeled out and, you know, ignored for the day. So you're people that aren't super, aren't extremely independent.
00;26;24;06 - 00;26;39;18
Unknown
But they always are wanting them in a more homelike environment. And that's why I think these are really growing is they, they see the, the individual care that they get in a smaller environment and then the friendship that they get to make in a smaller environment. You know, we have gardens and we have goats and chickens and things like that.
00;26;39;18 - 00;26;55;01
Unknown
So it's a home. It's not a facility. Our, our, our homes like they are homes. They're it's a six bedroom home. And it feels like a home when you walk in, it does not feel like you're walking into a facility. And people are starting to like that a lot. So I think that's kind of why this is growing.
00;26;55;03 - 00;27;19;03
Unknown
I think investors specifically are starting. Real estate investors are starting to move this direction or look at this direction because of what we talked about earlier. I think you can't it's almost impossible in a lot of areas to be a cash loving, long term rental. It's really hard in this rate environment. And after, you know, all of the capital, depreciation we've seen in the market this last year, like it's, it's challenging.
00;27;19;05 - 00;27;43;12
Unknown
You have to buy really deep and be really good to get cash floating real estate right now. And so I think that people are looking for ways to continue to invest in real estate, continue to buy, but not just at the capital appreciation side. Still, the cash flow side, actually, I think that's, there's a big opportunity for cash flow because these things are, the numbers on these things look great.
00;27;43;13 - 00;28;06;29
Unknown
Obviously, there's a lot of business execution has happened for you to get to that point with these. Why should somebody not jump into residential assisted living? Because I do think that part of the conversation is important. I don't think it's for everybody. And I'm always I'm always, reluctant to tell people like, there's always a next great opportunity, right?
00;28;07;02 - 00;28;26;01
Unknown
And not every opportunity is for everybody. And where they're at in their business. So why, why, why can somebody not jump into it. So I think a few things. One, if you're someone that's that's wanting something to happen, that's if you think you want to go from 0 to 100 and snap your fingers, this is not for you.
00;28;26;03 - 00;29;00;11
Unknown
Residential care. It takes time to get residential care off the ground and running. It takes time to get stabilized. It takes time to find the right staff and train great leadership and be able to remove yourself. So I think that's a big piece. I think also it's it can be capital intensive. And so someone that doesn't have a tie capital doesn't know how to raise capital or doesn't have access to capital, really should or should not be considering smart or because you have to have a decent runway when you go into this to be able to support it until you reach stabilization and and cash flow threshold.
00;29;00;11 - 00;29;19;09
Unknown
So those are two things. Also, I think from an operational standpoint, you have to be someone who's really strong and business strong in leadership. Or I guess there's two ways, because there's a lot of people that do it this way, or you have to be someone that actually enjoys caring, wants to work in this business, and wants to be in the day to day.
00;29;19;11 - 00;29;36;19
Unknown
Because I do see, I know a lot of people personally who who love it and they're in it and they're in the day to day, and they love being with their staff. They love seeing their clients and they run, you know, two, three, four facilities. Sometimes, it's really far to run and more than 2 or 3, if you're going to be an it yourself like to that level.
00;29;36;22 - 00;29;57;00
Unknown
But, you've got to be good at you've got to love it or you have to be really good at business and really good at leadership, so you can find the right people to run it so that the quality isn't anything. If you're dealing with people's bias in this world. So it's not, you know, it's not a business that you can just buy time off the way you have to make sure your systems are solid and your people are solid, so that your clients will take this.
00;29;57;01 - 00;30;21;13
Unknown
It's super powerful. It's such a purpose driven part of the industry. It's kind of a hybrid, too. It's like half real estate, half business with a little medical mix then. And it is interesting because, you know, real us as real estate providers, especially those of us who have matured in the industry, is their access to capital. We're not scared of rehabbing a house or whatever it may be.
00;30;21;15 - 00;30;46;08
Unknown
We're good at that part. But then what's cool is, like some people you can get like SBA loans on this, there's there because it is considered a business. Depending on how you set it up, there's different opportunities with this. And I was I was looking up some stats before this. And there are seven, there's about 360 million people in the United States.
00;30;46;10 - 00;31;21;26
Unknown
73 million baby boomers will be hit, are in retirement age. As of 2026, 73 million of 360 million total. That's there's just this year. Just this year alone, 4.2 million people will hit age 65. Obviously, that that's inside. Yeah. Those are numbers that a large contingent of the population who needs us compared to history. So there's a demand for that that is exceeding what the supply is.
00;31;21;26 - 00;31;44;00
Unknown
Now, if we think because you're a business person, I'm a business person, we look at this and we go, a good business is one that has a lot of demand and limited supply. In 2020, real estate was like easy tons of demand, minimal supply, historically low supply. And obviously that was benefiting us with with the prices and our equity and stuff like that.
00;31;44;00 - 00;32;14;09
Unknown
But this this business is another great opportunity for that reason, with the caveat that nothing comes easy and there is a real purpose behind this work. And if you think about this, this is, one thing I learned from you and kind of learned in my research for this particular strategy is that when people put their parents in residential care facilities, it's not where their parents live or set.
00;32;14;09 - 00;32;50;00
Unknown
It's close to them. Yes. If you think about the gravity of that, they want their parents to be close to them because they're important to them. The same way your kids are important to you, in the same way those things that are so called, so you are entrusted with a really meaningful responsibility, which is why the the business owner, like us, can create a more intimate experience that's better than these big box residential care facilities that got, you know, 500 elderly in them and 30 people servicing them.
00;32;50;02 - 00;33;17;01
Unknown
We're talking about one person servicing, 6 or 1 person servicing, 10 or 2 people servicing 10 or 15. Not 30 people to 500. And some of these big apartment like facilities. And with such an intimate thing, people want that. That's why there's such high demand and there's a shortage of that type of capability available to those of us who are like the millennials.
00;33;17;04 - 00;33;40;19
Unknown
Our parents are aging. You know, we want to get we we have money because we were able to afford to buy houses early in our lives. Not for, you know, millions of dollars for two, two, but now. So it's a it's just all these things add up to this great opportunity. But it comes with that caveat that there is a real purpose, passion behind it.
00;33;40;19 - 00;33;58;09
Unknown
You have a you're entrusted with the massive responsibility of a human life. You're in the fourth quarter of somebody's life, and you're entrusted to put them in the best position possible. And I think that's a really, really big deal. Yeah. And I think this business is almost like any in the fact that it does get easier with scale.
00;33;58;09 - 00;34;14;20
Unknown
The first one's the hardest, the second one's a little easier. And it just gets easier and easier. Easier repetition and scale. For, for somebody that you because you get better and you earn more and you, you know, always copy and paste is easier. But then also because you're able to put more people in places, you know, at a higher level.
00;34;14;20 - 00;34;38;11
Unknown
So you're not so much in the lead. But like you said, that the winger entrusted with somebody's life like this, like there's always a chance you're going to get put back in the market. That's a reality for me. You know, my facilities. If if one of my lead people, you know, decide they're moving, you know, across the country, like, you know, guess and stop and back it and like, you know, until I find a nice right person because you don't just hire anyone in this business, you have to hire the people.
00;34;38;13 - 00;34;59;25
Unknown
So that is that is one thing that anyone getting into this business needs to realize is while it can be semi-classical, you know, I mean, I spent probably an hour and a half in my business a week, realistically, on an average week. So it can be some work for sure, but there's always a check you're going to have to tap in, and you have to be ready.
00;34;59;28 - 00;35;18;14
Unknown
Yep. You got to be prepared to be able to put 20 to 40 hours in a week into that when it's necessary. And ideally, you set it up so that it's where you're at now. This is great. Actually. I'm so proud. I love I love community because my friends are crazy entrepreneurs like me. We all love real estate.
00;35;18;14 - 00;35;38;18
Unknown
We all love making an impact. We all love our families. And I think you're a great investor. You're a great business owner. You're such a value add to the community. But you guys are great parents. I've had the luxury of spending time with your got your kids, you've got a blended family. It's just I just get to observe that.
00;35;38;18 - 00;35;58;14
Unknown
I just want to say, like, that's really impressive what you guys have put together and how you guys parent. I'm serious. It's a big deal. We need more value in the world. Yeah, we are still at the. Our kids are so good. We we like they are so like we are just like is such a good kid. Totally smart.
00;35;58;17 - 00;36;21;11
Unknown
So. Well yeah. Which I not ex leaders. I was really impressed with your with your girls I just, I was blown away. I was blown away. So. Yeah. Well I mean we, we co-parent really. Well that's something we just need done really well with. And there's never been any co-parenting issues. So we just I don't know, we've been on the same page over.
00;36;21;12 - 00;36;42;07
Unknown
It's really one. Yeah. And I want to I want to just touch on one more point, lead the audience with this. Actually, I want to hear your perspective. There are a lot of husband and wife teams who dream of coming into business together and working together, and you might do such a great job of modeling that. But you guys have built this.
00;36;42;07 - 00;37;06;09
Unknown
You've built your business processes into your life and learned to work together in a really productive way. What kind of if you were to give guidance to those either current husband wife teams or those, you know, aspiring husband and wife teams, what would you tell them about going into business together? Yeah, so I think I'm really passionate about the work we say in our links.
00;37;06;12 - 00;37;30;17
Unknown
We have very defined this is your will. This is my role. We both value each other's opinions, but not getting in his lane or vice versa, not stepping on each other's toes. That really helps. Who's responsible for what? And I think that with anyone in business, whether it's your spouse or not. But, that was something we, we didn't really do in the beginning, and it did always feel a little chaotic because it was like, I didn't know, did you do this?
00;37;30;17 - 00;37;52;13
Unknown
I didn't do it. You know, it's kind of like that a lot. So now that we've sat down and really structured our business like a business, and he knows his roles, I know my roles. That has made a huge difference. Snack. Mainly we, we do, we try to do. And they work for 70%, maybe for daily things, four days a week because we have a business meeting once a week.
00;37;52;13 - 00;38;13;25
Unknown
So we meet an hour and a half and go over our business once a week. And then the other days we try to do a daily thing, whether it be in the morning, at the gym or after, you know, before the kids get home from school, something like that. But give us 15, 20 minutes to just update each other on everything going on with the business, everything we want to talk about that happened throughout the day, or even just Gemini stuff.
00;38;13;25 - 00;38;31;25
Unknown
But then that way when the kids get home, we're not still doing business all the time. That's the hardest part. When you're in business together, your business lead center, everything, you know, you'll be sitting in a baseball game and suddenly be like, hey, did you call the inspector on the house? And it's like, maybe I should just watch baseball soap, and I'm totally guilty.
00;38;31;25 - 00;39;00;18
Unknown
It's me. I'm he's really good at being present. I'm the one that always, always elsewhere is that you're the gas pedal, though, Ashley. You're the gas pedal. Mike's got such a calm, relaxed demeanor. Like, I'm not sure if he's ever stressed out. If he is, you can't tell. He's just chill. I want a little better. Yes. I think those are the things that I would tell people to to do and make sure you set up family time, make sure that you make that a priority so you don't don't go.
00;39;00;20 - 00;39;21;23
Unknown
Yep. Separate in church from state drawn clear expectations even though your partners in life like you need to run it like you would have a normal partner. And just because that kind of like clarity and transparency and in respect of each other's roles, if you don't have that, it will create a lot of pressure. You're already going to have some frustration.
00;39;21;23 - 00;39;39;28
Unknown
It's inevitable. And it's just, it's it does take work. And you guys, you guys model it so well for so many people. The communication though really I think is I think a lot of people do have accidents, but they're not they're not having constant conversation. But that's having the constant think it really cuts down on the lot of that restoration.
00;39;39;28 - 00;39;58;13
Unknown
I don't we don't really have many moments where we're, you know, frustrated of one or the other. We always know what's going on with each other. So it's there's we get to talk it out every day. Love it, love it. Absolutely love it. Okay. You you're active on social media. You got a lot of cool stuff going on.
00;39;58;13 - 00;40;26;27
Unknown
If people wanted to talk to you about house flip in investing capital in deals, residential, assisted living, residential care, how would the best way for people to reach out to you? Probably Instagram. Mike and Ashley folks. Facebook the same. All all inverse matter. Yeah. I want to encourage you guys to say, like Ashley Ashley's a phenomenal conversation, especially, business business systems.
00;40;26;27 - 00;40;47;25
Unknown
She's a very successful flipper and real estate investor in general. And definitely if you are like, man, I really been curious about the residential care stuff. Like she's who helps me as we add that component to our business. And, I would love for you guys to have a conversation with her about it because she's an expert. She's been doing it for a long time.
00;40;47;25 - 00;41;11;23
Unknown
She's not. It's not like she just started doing it when it got cool. She's been doing it since 2010, and I think there's something to be said about experience in the market. You can't you can't pay for that. You can't replicate that. But you can certainly tap into it. And having a conversation with somebody like Ashley. So, we'll drop her Instagram in the, in the description so you guys can quickly, find it and then talk to her about it.
00;41;11;28 - 00;41;38;14
Unknown
She will she will talk to you about it. She does enjoy that conversation. So Ashley, thanks so much for spending time with us today. Absolutely. Thank you. All right. Thanks for listening to today's podcast with Ashley Coates. Amazing podcast about everything from House for being to business to residential care facilities. If you enjoyed this podcast, do two things one.
00;41;38;16 - 00;41;44;14
Unknown
Leave us a five star review and to reach out to Ashley and talk to you about residential care facilities. Thanks for listening.
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