Making Money 7 Different Ways on Each Property (Without Even Owning It!)

0:00She makes money seven different ways on every real estate deal and never even owns the property. Most real estate investors think in deals. They think buy a property, renovate it, sell it or rent it out. One revenue stream per house. In 2022, Chauncey was flipping houses and accumulating rentals, doing 20 deals per year. To make more money, she needed more capital and more contractors and more tenants. And that means more headaches. So she built an entirely new model. Now she runs a vertically integrated real estate operation. Her clients put up the capital and they keep the profits, but Chauncey takes a cut at every stage of the project, which can often even be more profitable without all of the risk.

0:41This business gives Chauncey a unique view of the entire real estate investing ecosystem. Today, she's sharing the lessons she's learned from this rare real estate perspective.

0:56What's going on, everybody? I'm Henry Washington. Oh, yeah, and Dave's here too. What's up, Dave? Don't sound so disappointed. I'm excited to be here. This is going to be a fun conversation with Chauncey today. Yes, I'm super excited too. And honestly, there's probably a lot of real estate investors out there who have the skills and resources to do something like this, and they probably just haven't done it. Today, we're talking with Chauncey Pham, an investor in the Dallas market, and we're talking about building wealth through real estate ecosystems, not just properties. Chauncey's going to show you how to think about real estate as a business with multiple revenue streams, how to source deals creatively without relying on wholesalers, and which pieces of the process you can start monetizing today, whether you're flipping, buying rentals, or doing any other strategy.

1:42So let's bring her on. Chauncey, welcome to the BiggerPockets podcast.

1:47Chauncey Pham:Hi, thanks guys for having me on. Let's start this off the same way we start off every show. Won't you tell us a little bit about your background and what you were doing prior to real estate? So my background is hardcore, one call close type sales. And then I end up transitioning into a marketing role. I was an account executive for a marketing firm where I worked with a lot of C stores and fashion chain. So BCBG, BB, Circle K. And I essentially was the liaison between their marketing departments and my company who actually created all of their point of purchase marketing. And so it was really, really cool because I learned the psychology behind marketing in that role.

2:22Chauncey Pham:And while I had that job, my husband and I end up buying and selling a couple of primary residences. And our loan officer was like, you'd be really freaking good if you got your real estate license. So I got my license, but I legit got my real estate license because I wanted us to go to Disney World and ball out with the VIP passes and pass. That's why I got my real estate license. So you're like, if I sell one house, then I could go to Disney World. I can go to Disney World and fall out. And so that's why I got my license. But because I had the sales background and the marketing background, within three months of getting in the business, I'd made my entire annual salary in commissions.

3:00Chauncey Pham:And so I quit my job and it was off to the races from there. So what year was this when you got your license and then decided to do your actual first real estate deal? So I got my real estate license in 2016. And I just was a traditional realtor from 2016 until I picked up my first investment deal in 2019. So after a year of having my brokerage, which, by the way, the root word of brokerage is broke. And that's what the hell I was for the whole year and a half at it because realtors don't sell anything. OK, let's just 90 percent of them don't sell nothing. And so I essentially then moved my brokerage, shut it down and went over to the national brokerage that I'm with now and became the top recruiter within the first year that I was there.

3:45Chauncey Pham:Brought 400 agents underneath me in that first year, was making money off of all of their sales, which then allowed me to get out and start investing. So I started doing that in 2019. Chauncey, we get this question a lot about becoming a broker, real estate agent, before becoming a real estate investor or in tandem with becoming a real estate investor. So what is your advice to people who are considering that path? I 100 % attribute my successes and my mindset in being an investor to the fact that I was a realtor first. Really? 100%. Interesting. And I would recommend to anyone that wants to be an investor to at least explore getting their real estate license, not so that they can go and sell houses, but so that they can understand the basics of the real estate transaction from the consumer perspective.

4:34Chauncey Pham:because when I started flipping, I knew what it was like to take a buyer to see eight, 10 houses in a day. And at the end of the day, ask them which one they want to put an offer on and how 90 % of them were completely forgotten because they were all just white, gray, same floor, same trip, same thing. It's all the same thing. They didn't remember any of them. And I knew what made them tick emotionally. So I always said, if I start flipping, I've got to find a way to be strategic in creating a product that's going to be memorable for clients and be something that people actually seek out. And 100 percent, that is what has set me apart from everyone else that's in my market.

5:12I don't 100 percent agree with you on the getting your real estate license first thing, but I totally but I totally understand that perspective. And I like the perspective of like understanding both sides of the transaction, because you're absolutely right. A lot of investors, purely numbers focus. The amount of times I've heard flippers say, just get a spec sheet and flip the same house to the same spec sheet, same color, same finishes, because it's better for business, drives me up a wall. Every house we do is about what we think the buyer in that neighborhood or that particular market wants.

5:47And that's what's going to help your houses sell faster. So that perspective on why you should get your real estate license, I think is a pretty cool and unique perspective. And I agree with you. Investors need to learn more about what your customers want. And sure, there's probably some happy medium between like systems processes and repeatability and then still having some form of individuality, but you've got to do it properly.

6:13Chauncey Pham:Correct. Correct. I'm assuming as you were doing these real estate transactions as an agent, you were like, hey, these investors seem to be making some money. How are they doing this? Like, what made you decide I'm going to take the risk and do my own real estate deal? Because it sounds like you were killing it as an agent, right? Yeah. So, so what made me kind of pivot from just being an agent to an investor is I had an investor client. He reached out to me. He had a flip that was in the neighborhood that I'd sold quite a few listings and was like, Hey, can you just go and give me some feedback on this property?

6:44Chauncey Pham:It's been sitting on the market and not getting any showings. Let me know. So I went, called him the next day and I said, you know, here's my advice. Here's what's going on. He called me then the next day and said, all right, I've got good news. I got bad news. The good news is I don't have to deal with the realtor that had my house listed. And the bad news is I don't have to deal with her anymore because I fired her. And if you don't take my listing on, then I'm screwed because all my money's in this house. And so I took his listing on and I sold it the very next week over asking. And from that point on, I became his agent.

7:16Chauncey Pham:So I helped him with acquisitions. I helped him on the consulting side. And then when his flips would go on, they're ready to go on the market, I actually listed the properties. and I would see every single time that we went to the closing table, how much money he was making versus like what my mission was. And I also learned his process. He didn't have one. He didn't have a duplicatable process. He literally just was like, luck deals were falling into his lap and then he would get it and take it down. And when I would ask him, what's your process of getting these houses? He had zero processes.

7:49Chauncey Pham:And so for me, I said, if this guy can do it and he's making this money, then I definitely can create a duplicatable process system and like and plus all of these flips are kind of ugly so i can i can do it and i can do it better and and so i actually talked to my husband who was basically a c-suite executive he was our breadwinner right like i was making great money but he has the insurance he got the job and i'm like babe quit your job and join me in real estate and you can open our investing side and he was like, all right, bet. And he did. Really? And he did. That's it? Just like that? Literally, it took him a couple of months.

8:30Chauncey Pham:He's a sales expert. Yeah, that's true. You didn't know what to say to him. Yeah, he didn't even know it was coming. And he's a sales guy too, so we always argue about who's the best closer and I'm like, who's the best closer now? And so, yeah, got him to quit the job and he started our investment company in November of 2018. And January 2019, we had our first deal. All right, we've got to take a quick break, but when we come back, we'll hear more from Chauncey right after this.

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13:32All right, we're back with Chauncey Pham talking about vertically integrating your real estate business. Let's get back to it. So what did that first deal look like?

13:40Chauncey Pham:This particular property, we went out and walked it. And long story short, we were able to pick it up for$125 ,000. The lady just wanted enough to pay it off and have a little bit of money to walk away. We bought it for$125 ,000. There was nothing wrong with the house. We were going to put about 20 grand into it and sell it at like the 215 mark. But instead I threw it on the MLS in coming soon and had an investor that was looking for rentals in the neighborhood, put it in for coming soon at 192, went under contract, sold it two weeks later at 186 and did absolutely nothing to it. So it was basically a hotel deal.

14:15Chauncey Pham:And I was able to take that 60 ,000. And then we just kind of kept rolling from there. Obviously that sounds incredible, Chauncey. People are probably wondering like, is that possible? Is it possible anymore? Or is that kind of deal a relic of a different time in the market? I don't think that her situation was unique. The way that we were able to capitalize on that was she had previously had the house on the market with a realtor and it had gone under contract. And when it had gone under contract, the title company popped up with a lien and it was a consumer debt lien. And so when we talked to her, she was like, last year tried to sell my house, but this lien is on here.

14:53Chauncey Pham:If you guys can just get this lane gone and just get get me this much money in my pocket like you can have the house and so i think that what was unique about that situation wasn't necessarily unique it was the fact that we understood how to how to solve a problem yeah and so are those types of deals still out there where you just need to be a problem solver yes all day long that's what all of them are um and i just think that far too many people are in the game and they're not looking at themselves as problem solvers rather they're going in with kind of a one-trick pony because even when we went to her, it was not let me just buy your house.

15:24Chauncey Pham:It was I can buy your house. I can list your house because I'm a licensed realtor. That's another reason you should probably get the real estate license. I can renovate it if you want and then take the cost of the renovation, just put a lien on it, and then we can sell it on the market. Whichever solution is best for you. And so I definitely think those deals are out here. Yeah, those deals definitely exist. I have under contract right now that we're, I think we're paying 180. It doesn't need any work. We're going to clean it up, throw it back on the market for 250. It's the situation that's causing us, you know, it's called the lady is about to lose it in foreclosure.

15:59And so we're going to buy it. She's going to make some money instead of just losing it. And then we're going to turn it into the house was built like three years ago. So it's, it's about looking for situations, right? Chauncey, can we play a game? Yeah. I'm going to put your skills to the test. Okay. We're going to role play. I'm going to be a seller. I like that. So I filled out your website. I have a house on 123 Main Street. You get the lead and you're calling me and I answer the phone. And what do we say? What do we do?

16:27Chauncey Pham:Hey there, Henry. How are you? Oh, I'm doing great. How about you? I'm doing pretty good. Hey, you're the owner, right? Over at 123 Main Street? Yes, I am. Absolutely. All right, cool. Well, I got your information from my website. It looks like you are looking to sell this thing really quickly. So tell me this before we even get into the conversation. If I could wave a magic wand for you, get this thing sold exactly the way that you want to, how does the situation play out in your head? I would love to get it sold and get it sold quickly because I really need to unload this property so I can get the money I need to move on to my next property.

16:59Chauncey Pham:Okay. So number one, how much money do you need to move on to your next property? And number two, why do you need to sell so urgently? Yeah, I need to sell urgently because I found a house that I really want to buy. And this one has too much work that it needs for me to get done. So I just need out. Okay. So you need out. And how quickly are you looking to close? At least 30 days or less. If you can go faster, that'd be great. Okay. Awesome. And so then at that point, I would typically do some sort of analysis with them and start pulling up the comps on the property. And at that point, I would start really poking the bear at the pain, right?

17:34Chauncey Pham:So I would ask them to send me any pictures or possibly FaceTime me. Let's do a quick video walkthrough of the property. So then I can compare it to what's on the market. In this way, this can expedite me getting an offer. I don't even need to come out to the house. FaceTime me real quick. Get me on Zoom. Let's walk through it right now. I can get you an offer right now on the phone. And I'm going to also at that same time pull up some other properties and have him pull it up and acknowledge the fact that his property is nowhere close to those so that when I come with my low ass number. He's not offended.

18:06Chauncey Pham:So you understand your house doesn't look like one to four main street. That's right up the street. This one, look, this one has granite countertops. We just walked through yours as for Micah. And I'm gonna have to replace all of that. You understand that? And so I typically walk them through all of that. And then I'll even normally ask them a question. So Henry, based on these houses that I just showed you, how much money would you personally think needs to be put into your house to get it up to that level? I love this question because I do it all the time. I would say somewhere between $25 ,000 and$30 ,000, which in seller talk means what to an investor?

18:40Chauncey Pham:Yeah. Now, Henry, how are we going to get$25 ,000,$35 ,000 done? You think I'm doing the work or I'm going to hire someone? I have to hire someone. So that's not going to work. Realistically, this is looking like about$100 ,000 that I'm going to have to put into it. So let's back these numbers out. So you want to walk away with X, Y, Z. And in order to do that, I would have to give you this number. But if I attack$100 ,000 on top of it, when I turn around to sell it, I don't have any money. So let's work out something that's fair. Does that work? I can solve your problem in the timeframe that you need it solved, but I'm also solving a problem for myself.

19:14Chauncey Pham:Let's make some shape. And that's typically how I level with them. And that's the investor standpoint. Now, when you make those offers, are you also offering them a solution where you're the agent at the same time? So typically if they are offended by the investor offer, look, you don't get both at the same time. You can't be out of time and want more money, okay? So if you want to tell me right now that you're not out of time, then I have another solution for you. And that solution is we can come in, we can maybe do a little bit of work on the property for you. I own my own construction company, so I can come in, I can do the work for you.

19:53Chauncey Pham:We can get paid on the back end so we can work out a deal that way. I'll list it for you. I'll control that part of the transaction for you. Make sure that your fees and all of that are really good on that end. We'll take care of the construction for you. And then we get it sold and get you that higher number. But it's going to take a little bit more time. So which one do you want? Want time? You want money. I love it. I love it. I do a version of the same thing. But what you were essentially doing when you asked me what I wanted was you were trying to figure out which solution makes the most sense, right?

20:20If you're saying you need to move quickly, then you're thinking as an investor. And if you're saying, I have all the time in the world and my house is in great shape, then you have an option as an agent to list that property. And I think that that's what investors need to learn is your job isn't to sign your contract on your next deal. Your job is to figure out what does that seller need? What do they really need? Because they're obviously going to hold something back, right? Because they think that we're here to swindle them and get this best deal possible, right? And so they're holding these cards close to the chest.

20:57But as you ask questions, you can start to figure that out and you can start to present a solution that actually works for them. And I think what you're saying is as a licensed agent, I now have more options to help somebody than somebody who is not a licensed agent. Correct. Because all they can do is make a cash offer or maybe do something from a creative financing aspect. but they can't list a property and they can't do some of these other things. And so I do think that licensed agents have a superpower, but I don't know that they all know how to use it. So you did your first flip about how many flips did you do in a given year?

21:33And for how long did that last?

21:35Chauncey Pham:So our first year, 2019, we did exactly 10 flips. Wow. Yeah. So we did 10 our very first year. So that$60 ,000 kind of gave us a little confidence, you know? and we built a little process out and then we bought our second property. And then after the second one, we had the opportunity to pick up three more. So we were running four at a time right after our first one. And so by June of that year, because we picked up our first in January, by June we'd completed like five or six. And then it kind of kept snowballing from there until our highest year we did 21. Oh my God. That just gives me so much anxiety.