Episode 109: Creating Cash Flow Through STR With No Money Down With Michael Porche

Michael Porche is a Short Term Rental owner & investor, founder of STR Legacies, LLC and founder of Escape and Stay Property Management. Michael helps educate real estate investors on how to acquire STRs, as well as how to self manage their properties. Michael started off as a Fire Fighter for the city of San Diego. He loved his job; it was his dream job. However, he quickly found that he was sacrificing too much time away from his family to provide for them. So he asked himself " What is the best way to create passive income?" This is when he discovered Real Estate investing, specifically in the growing market of Short term rentals. As an STR practitioner, Michael provides his coaching and education services to anyone looking to build their legacy through Real Estate investing. "Your Freedom is just one STR away!"
Get in touch Michael: strlegacies.com
michaelporche.com

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Are you ready to bring your real estate game to the next level? My name is James Prendamano. I'm the CEO and founder of PreReal And over the past 25 years, I've closed over a billion dollars in transactional real estate. Each week I'm meeting with outstanding investors, high performing individuals, and visionaries operating in the real estate space. These are the people that are actually out there in the real estate game right now getting it done. This podcast aims at bringing anyone's game to the next level. This is the prereal podcast.

Welcome everyone, to the Prereal podcast. We're joined today by Michael Porche. He's got two main companies, folks, that we're going to talk about. He's the owner of STR Legacy LLC, which is essentially a consulting business that brings folks through the short stay or the short term rentals, the airbnb and coaches people up on how to acquire, find, invest in and make them profitable and manage them, of course. And then escape and stay, which is the management division, if you will, of his portfolio and some investor portfolio. So Michael, thank you very much for joining us today. It's a hot topic. Excited to have you on the show. Awesome. Yeah, glad to be here, man. I'm really excited to dive in. Yeah, let's do it, baby. Michael is having a crazy day. And it's funny, before we got on, he was doing all the things that I was scrambling to do before I got on. It's good, man. It's good to be busy. I love it. Look where we're finding a lot of folks are having that moment of clarity that it seems generations before hours, Michael didn't necessarily have. It seems that folks in generations past fell into their career, whatever it was, and they got up and they went to work and they did what they were supposed to do, what they thought they were supposed to do. There wasn't much room for coloring outside the lines, if you will. And I feel like today we're seeing a lot of folks trading in and hanging up what they were doing before and pursuing other passions. A lot of reasons that could be. I think Covet certainly has played a role in that. A lot of us have had the time to revision what we really want. I think coaching has had a lot to do with that. But you're not excluded from that group, right? Your passion was you want it to be a firefighter, is that correct? That's right. That's correct. So can you walk the audience through how do you make a leap from a firefighter to a passion for real estate? Yeah, that's a pretty easy one, I guess, to answer, because it's definitely my life. So I will start with a little bit of background. That background. And just to emphasize on what you said in regards to we're coming from a generation that believed in working essentially coloring within the lines of what they were told, and a lot of that was working nine to five, put your money in your four hundred and one k and essentially work that direction and you'll have a great life. Well, back then the industries that were involved took care of their people really well. Not to say they don't now, but it's just more of the job opportunities was a lot more there and you didn't have to work as hard in order to be home with your family. That had a lot to play with it and add on more to that. Coming from my parents, my uncles, my grandfather, everyone essentially came from that kind of work life. You buy one house, you do this, you work this kind of number, and then you retire at 65 or 70 and you hope that makes enough. But sometimes that doesn't work out, a lot of times that doesn't. So it was my dream to get back to my story, to be a fireman. Since I was a little kid, that's all I ever wanted to do, that's all I ever lived and breathe. I had the opportunity to make that dream come true when I turned 25. I worked in essentially the 911 industry in general for about ten years and worked as a fireman for the city of San Diego as a firefighter per meter for about five. And that was definitely rewarding, fun loving career. And the reason why I stuck with it and ran towards it was due to in my mind. It was a job that was able to provide for my family and give me enough time. Because essentially I was only supposed to work ten days out of the month and give me enough time to be with my family. To support them and to have time off with them and as well invest and do ministry. So that was essentially what I was really excited about for that career. I thought even that was considered maybe a little bit outside the box, but when I got into it, I got married, it still was working fine. Then we had our first daughter, and at that point in time I wanted to make a decision essentially to say to get my wife the option to work so that she could be a mother. And that was something my mother did not have the option to do. So it was really big in my life. I wanted to make sure I gave her the option. So I worked a lot in order to support ourselves in Southern California, in San Diego, essentially just to make that happen, to the point where I was not only that we're also low staff, but I was working anywhere from 20 to 25 days out of the month in order to make that happen. But what was bummed about that was when I got home from work, a lot of times I got ran like working 24 hours, but we get to these certain scenarios where I'm coming home, I sleep for 5 hours, and I'm giving my family, my wife and my daughter the worst of me because I'm tired, I'm grumpy, I'm just trying to survive. And so it was like this there's got to be another way. And so a friend of mine, he gave this book to me, Richard, a portrait, which a lot of people have read within the real estate community, and what kind of gave them the vision. And that's what it gave me, gave me a vision to see that you can get passive income from real estate and there's opportunity through there. And so that started on the path of like, hey, there is another way. And that kind of is what was the start that got me from thinking, I'm going to work my nine to five, my dream job, and do this until the day I die and retire to hey, I can have other people essentially pay for my lifestyle and for what I want. So Rich Dad, Poor Dad, I think is the single most impactful book. I don't think I've done a single show where Rich Dad, Poor dad has not been referenced as part of a pivotal part of the journey. What an unbelievable book. Can't seem to figure out why financial literacy is not part of the core curriculum, why this isn't something that we're teaching in the schools from the youngest of ages. Because it really is transformative. It really is stuff you don't learn anywhere else. And it also had a profound impact on my life. It was part of my journey, too. So you're in the hustle. You're trying to do what you think is the admirable thing and give the opportunity for mom to be a mom. And I applaud you for that because I know that sometimes it's not well received. But I did the same with mine, and I could tell you it was the best decision we ever made. So where does the real estate passion come from? There's a lot of places to go. There's a lot of things to do, right? There's a lot of hacks out there today. There's a lot of ways to make money, side, hustle, Gary Vee, whatever you want to call it. Why real estate and why the short term rentals? Great question. So, I mean, ultimately the initial reason that brought me to it was more for. I kind of fell into it as a concept that, hey, this could actually work. But why stay with it? And why it really helps and why real estate in general is because I have a very specific certain goal in mind. My goal is so that I can create one cash flow, replace my expenses, and replace my income, two generational wealth, so I can build upon wealth and multiply it through loans and through real estate that I can utilize for other vehicles.

Really? Essentially, real estate and short term rentals are just one of the best vehicles that allow me to do that, especially with what can be paired with them. So I had the envision. The original idea was to combine business and real estate together. My first whack at that was assisted living, and assisted living probably still is a good vehicle, especially in this season of life of where we are as an economy, a people group, everything. But it was something that I just really didn't enjoy. I got into it for about a year and a half. We did really well with both of the units that we bought, but it was just draining, and it wasn't fun. Heavy system. Very heavy. Yeah, very. We ended up selling our interest at the end of the year and then kind of transition to another avenue, which was the short term rental side of things, which is a business. So we created businesses within and around it, but at the same time, we also get to take the ability of the appreciation of these properties and the cash flow. So I guess to dive into a little bit of what that looks like now. And why I'm even saying it longer is because there's a lot of data out there that allows us to see where you can get some of the best cash on cash return. And so some of that data allows us to be in a position where we can buy a property. I have one student who bought a property for like $48,000, and the revenue on that property is $57,000 a year. It's awesome. I have another student, and I can talk about my own properties, too, but one guy named colton great. One of our really, of your students. But he closed in a property or just recently, last month in July, and he bought it for $423,000. And he is coming out of the gate this month in August. He's on pace to bring in $20,000 for just this month, but throughout the year, he's looking at about 100. He's projected to make 143,000, but of what's actually been recorded, we're looking at 20,000 this month. So, folks, these numbers that michael is talking about, just to put it in historical context, right, if you're in any kind of fund that's throwing off 7% a year, you're performing, right? They're performing, you're happy. Everyone smiling like you're doing well. These are staggering returns and why I was so intrigued. The biggest and best rates. Michael, for decades, made money between the margins of trading the pension funds and four caps and five caps, right. That's 20 years to get your initial investment back. Your first example was one year they had the initial investment back. Your second example was just shy of three years. They have the initial investment back, right. So some of the biggest and best funds out there are trading in those super thin margins, and now here comes these opportunities. So I want to make sure that we get to what can my audience do to start this type of career? Part of my passion is to take the 25 years of knowledge that I've accumulated and impart it to friends, family, listeners, folks that I come in contact with to help them achieve their goals. Right, so how do we talk to the audience about taking the steps? Where do we start? What do we do? Yeah, I think the very first step is to get clarity, clarity exactly on what you as an individual for your listener. What do you want your life to look like, vision like, what do you want to look like? And draw a picture, write down what that looks like, write down the activities that you're doing. Write down the things that really make you smile and get really excited about that's the first and foremost, because that's going to be essentially what is fulfilling for you in your life and what you really want to achieve. The next thing is exactly the same format. It's like, okay, now we need to bring down and make some smart goals in that specific measurable Attainable Realistic and Time Bound is what that acronym stands for. And essentially patch that towards your vision and making the line. But with that you've got to find the right vehicle that can bring you there efficiently. And so for most scenarios for people that we work with, they need to replace their income or their expenses first so that they can actually focus on time, on doing the things that either would generate more income or higher rate of returns or spend time with their family, travel, whatever it may be. But I would say to dive deeper into your question, what they can do to get started is really essentially just starting there and really kind of asking yourself that. Now your vision could look like what you're doing for the next year, next five years, next ten years. But I would also want to encourage you not to think of your goals out three years because so much life happens in three years. People will do what's your five year goal? What's your ten year goal? Yeah, that's good to have, but write it with a pencil, not a pen. I'd say, look what you can do in the next three months. There's a book called Twelve Week year out there. It's really good. And it really boils down from getting into a position of having your year goals for the company to bring it down to three months. Because essentially what you can do in one year, a lot of times, most of the time you can do in three months. And so they break it down in three months. And then from there you work backwards. So you get your three month goal, what you need to do in one month in order to get that three month goal. And then you look at what do you need to do in one week? To get that one month goal well within that week. What are the daily habits and primary activities that you need to do in order to achieve for that week and for that month? Because that's what's going to lead you to that three month goal. And so breaking that down, working backwards is, I'd say, essentially the best way. And if short term rentals is a vehicle and real estate is a vehicle, in order to help get there, since you have to plan it out and be realistic, write down numbers, you have to measure yourself. If you're not measuring and inspecting what you expect to happen, it's not going to go well. But you have to essentially have a measuring stick and you have to have not only goals, because goals can be great, but they're useless without the habits. So that's what my encouragement would be in order to a good starting place before we even talk about real estate. Yeah. And coaching, folks, will go a very long way in helping you with that. Many of you that have been with the show for the last couple of years know where I was on coaching, where I now am on coaching. It has profoundly changed every single aspect of my life, business, personal. And I could not possibly have been scaling and doing the things I'm doing without a lot of coaching along the way. So some of what Michael just dropped on you there is extraordinarily insightful stuff that without taking those steps first, you can pile systems on anyone or anything. If you don't have the proper foundation, the systems aren't worth a damn. And what Michael is describing is clarity, intentionality, purpose, focus, all of those things you need to have to start the journey, really. So now we've gone through that, and I've determined that this is a potential typology I want to explore and I want to invest in. Now. Why? Yeah. Before diving into answering that question, I do want to emphasize your remarks about coaching hands down. And I say it this way because some people will get weird ears when they hear coaching, right? And they'll think it's a scam or this or that, or maybe they do believe in it, but they had bad experiences. And I say this, have you ever dated somebody who didn't work out? The answer is usually, yes. Well, are you married? And the answer ends up being yes. Well, it's like, obviously, okay, just because you date someone who's bad, who wasn't good for you, doesn't mean you want to give up on finding the right person for marriage. And so I really say that with coaching, you will be very specific. The reason why I want to start with the specifics of what you want is because that's going to help you find the coach that you want and that you need. And you want to also measure your coach because essentially when they're self able to provide the value that you need, you should probably essentially find someone who is able to get you to that next level. And they have to either have a track record of doing it themselves or a track record of them helping other people do it really well. One of the two, I've had bad coaches. I've paid $30,000 marks and not be good. I paid 2000 and it was great. I recently just paid 10,000 a couple of months ago and it was amazing and made my money back. I'm actually about to pay the same people another 40,000 in order to continue with what they're doing with my business because I see a return. It's investing myself. Now, to go to your question for the yes, short term rentals real estate is a good market to dive into. Then I would say at that point in time, because real estate is so diverse, even in the short term rental space, you need to find the vehicles that's going to get you there for what you need, for what essentially what your resources are and what your capabilities are. So one of the things we do within our coaching programs, we break that down and see like, okay, what are your resources that you currently have available that's easily accessible? Because those are the most fruitful that we can with less. Because the reality is people can get money and get lend money, and if they find a right deal, they can find money for it. Right. But the reality is that's also a skill to learn and there's some resistance in getting to learn that skill well and learning how to do it well.

I also encourage, hey, let's start off with the lowest hanging fruit, which is what your resources are that's built on that and then finding out what that is. And then I'd recommend, okay, now we need to look at our data in regards to what data is going to allow us to essentially find so in our program. So it's hard to kind of differentiate someone from starting out with what I know versus starting out if they don't have access to what I have access to. For example, because you hear a lot of people and you hear them say, oh, go invest in the Smoky Mountains or in Broken Boat or in Miami or in Kissing me. And all these places, to be honest, are really over saturated and the returns aren't that great if you're just going to buy a normal property that everyone else has out there, it's not going to give you the returns you like. But for me, I would say knowing what I know and knowing what I teach, once you have that established, go and find data. We have access to data within our program, but go and find data to where you can essentially go into these markets and analyze these markets. Learn how to analyze these markets and then analyze the properties to find which is really the number one skill that's going to really help you out. And I know that's a lot and it's kind of like just really bunched in there, but that's the number one skill that's going to really help you out in regards to finding a good property to essentially accomplish that goal in the short term real space. Because it all starts the number one thing that's going to cause in terms of your most revenue is location after location. Then it goes into the type of product you have so how many people it sleeps right? The more people that sleeps, typically the more revenue you can generate. Then after that it's the better count. Then it goes into the amenities, what kind of amenities and stuff. Then it goes into the packaging and the lighting and the paint and making it look modern or pretty or whatever reason people are visiting that location for. But at first starts with your location, if you can get the location right. And that's I'd say 80% there. Was that good? I'm not sure if that was it absolutely was good. There's a couple of things I want to touch on though. So something you had said right in the beginning that I just have to emphasize folks, michael had said if you have the right deal, you'll find money. And he kind of went over it because he's clearly been doing this and he's seasoned and polished and he understands what that means. A lot of the folks out there don't and they're intimidated. I've been in the business for a very long time and I was intimidated. If you have the right deal, the money is available, you're the value. If you have the deal, don't make any mistake about it, you're the value. Investors are frenzied looking for quality opportunities and it's impossible to fulfill. All of the demands of the velocity of money is insane at this point in and out of these types of deals. So folks, please remember that and have that confidence. If you've got the right deal, you will find a syndication partner, a JV partner, whatever structure you want to pursue. Maybe you just want to have him in his debt, but the money will be there. So I wanted to touch on that. Now back to what you are focusing on as far as there are certain markets. You know, the Starbucks model was I don't want to go into the emerging market and pay $12 a foot because I know when I'm selling five hour coffees, I can go into the heart of New York City and pay $300 a foot and still make my margin right. But we're not Starbucks. So what Michael's referencing is there are the proven markets and there are anomaly deals that you could step into that are steep discounts to the comp. But if you're not in that market, folks, and you're not seasoned, trust me, you're not going to go on a foreclosure website that says that they've got the leads and step into Kissimmee and by killer Airbnb. The Realtors have been through it. The builders been through it. The Airbnb guys have been through it. The banks have been through it. Everybody has been through that already before it ever makes it there. So what Michael is proposing I love is find the niche, find that market that has some opportunity and then start to assess the physical elements of the property in that market. I just want to spend a few minutes, Michael, on what should the market have? What should we be looking for when we're saying is this a good airbnb market or not? Or short term rental? I know it's not. Airbnb is not the always end all term. But where should we be looking? Yeah, tell me what you mean. I'd say that's a great question to ask. So we essentially look on three factors. And those three factors are areas that we have high demand, high revenue growth and high cash on cash return. So typically, how would you know, right? You're not really knowing off the bat of how to get markets like that. Just present it to you. So where do you go to find that? Well, we like to call these like, Disneyland properties, by the way because Disneyland does a really good job creating that. They create demand to sell certain things. They create revenue growth by adding on new attractions every year. And they have a high cash on cash return because the value of one person entering that place or Disneyland is not how much the ticket costs. It's that none ticket. It's the water bottles that they buy at concession stands, the food they eat, the alcohol they drink. It's the vacations they buy for the next one. Everything essentially that goes into there. So that dollar per month per customer goes up and up and up. So it ends up being like, I think maybe $2,000 per customer is what they get from them entering in. We essentially look for Disneyland properties with the concept of the demand, revenue growth and cash and cash return. Now, what we've seen in areas of which that all these places we invest in have in common is that, one, they're drivable. They're drivable to another large area of people. And two, to be honest, some of these best markets haven't been places where you can necessarily fly into all the time. But there's a reason why they go there. So it's usually a lot more known to local people but not so much known to people across the United States. And so different things that we've seen is like horse race tracks is one we've seen venues like the one in Ohio is by. The reason why attract so many people and have strong demand is because there's Cedar Point or something of that nature. It's like a place you go visit Carnival, that kind of thing. For some sort of attraction, right? There's a reason why another one is skiing and snowboarding. So we built there are some places that are well known locally, but not necessarily across the United States. So there's always these little reasons why people will go vacation. Now, it's a double edged sword because typically the reason why you get such high demand in those numbers is because there's an attraction or something local, like even like Joshua Park, which you've probably heard about, but these, like, national parks where people like to stay in these areas. But the reason they get high demand, high revenue growth and high cash and cash return is because there's not a whole bunch of industries there providing jobs for people. So families aren't moving. There driving those homes and those costs up, which they would because, one, you're not paying as much for a home, a single family home, but at the same time, there's also not a whole lot of security. If something were to happen to that, say, one thing that is causing that demand to go up, which is a risk you have to weigh out and willing to take enough. But all these other areas, they're traveling there for something specific. Like on the horse track races. One of my guys, that's where he invested and he's getting $20,000 this month because of that very fact, because it's a high demand season for that. Wow. So that's what we've seen to be probably the most valuable areas. So geographical elements, skiing, lakes, water, horse tracks, perhaps golfing, amusement parks, national parks, state parks, some sort of draw. And the fact that the locals know it, but the rest of the world doesn't quite know it yet. Is that's the rub? That's the loop. Right? And folks, there's a lot of markets like this. We are going so deep and heavy into a market in New Mexico that we have utterly fallen in love with a magical place. We're excited to share it with the world candidly. But these opportunities are out there. And because there isn't the job base that Michael is talking about, the cost of housing has to be reasonable. So you're able to pick up these homes, three bedroom homes, sometimes for 40, 50, 8100 thousand dollars, and they're a short drive to a race track or to a famous ski resort or to renowned lake or to a renowned national park. So then we get into the, I guess the nuts and the bolts of does your course offer or your coaching offer, like models and calculators and ways to kind of back your way in, to really hone in on this? Do you guys go that far? We do. We go very deep. But yes, we go there. Okay. Because as we're talking through this, and the reason, selfishly, I wanted to have you on now is we're acquiring a number of the assets in this particular town. And the airbnb opportunity is massive and not many. Folks are doing it and those that are not doing it really well. So selfishly, I wanted to learn, what can I gain if we're able to subscribe after this and jump on board? And I want to be able to come out invest ready, right? I want to be able to come out knowing, all right, here's the market, here's how I can figure these things out. So you're going to walk people through, I guess, one bedroom yield, two bedroom meal, three bedroom yield. It matters, right? Bathrooms, condition. But a lot of folks don't have the knowhow, they don't have access to contractors, they don't have access to designers. So how do you start pulling this stuff together? So a couple of things with that. In specific to our program, we have all of that and we leverage teams on the ground for other places. So, for example, one of my first students, her name is Amber, she's actually our main designer, and she builds out all the fun. She's amazing at what she does. So she got her first property in Virginia. And I'm not shy to share my locations because most people just don't take action unless they have accountability or they have enough drive to do it. And if they do, good for them go. That's why in our coaching program, we're really big on accountability and we're really big on telling you next step to do it and come back to us when you do that kind of thing. But in regards to her, she bought a property listed for 270. I think she offered around 300 for it. She got it. She's on track to make $85,000 for that property. Great property. But that's where she started. And now she's actually designing all of our properties, my properties that we buy. We just started this investment firm to kind of go to your point, or we're testing it out in theory about these hedge funds buying these properties and doing that. So we're looking into position now raising funds to buy these properties because these guys who raise capital, which I do very little of, that, they are big time capital raisers. And they dive deep into the ability of knowing how to do that because they didn't believe that we were able to find these cash and cash returns. And so our first one that we're partnering on and making this happen is ridiculous. It's like 75% cash on cash. We can get into that property later. I have no problem talking about the numbers on that,

but I digress. I apologize. Going into it was the details of what's accumulating all your contractors and people that you'd be able to utilize essentially to have your short term rental run well. So once you get the property under contract, it's out of state, right? It's nowhere near you. You have to find ways to be able to manage it, find ways to be able to furnish it all kind of stuff most of what I done was like essentially my first few projects were rehab projects, and so I did on my own. I called a whole bunch of contractors and found people that I trust and built it out that way, and I used them and a realtor to be my eyes. Now I have a guy who manages projects like in Singapore, and he manages all my projects. He's my project manager, and so he does all that work. So he finds people boots on the ground and has all these forms, documents, and systems in order that it goes smoothly, and picture verifications with a third party source to make sure we're doing the things that essentially are what needs to be done. The next part of that is we have designers virtually come in, take pictures, do video walk throughs from people on the ground, and they build out furniture with Amber. Amber designs it. She sources it from like five to ten different places that she can order it, make sure it gets all ordered in one week, and gets it delivered there. I have contractors on the ground. Usually the best ones are stagers, but they're also costly. You can fly down there yourself and set it up. But stagers, they'll cost from $1000 to $2,000. You can get furniture movers and get a design template with PDFs and have those furniture movers do it all for $400. I've done that too, so I've done both. I'd say one's cheaper, but one's a lot more efficient. And sometimes you're going into these markets, speed is key. So you want to if you go one week longer or two weeks longer, that could be anywhere from $500 to $5,000 that you lost because you don't have it on the market. So those are the little things that we have in terms of making these deals happen. It's just by networking on the ground. But there are so many other things to consider, too, is when you're purchasing that property, when is the high seasonality so you can get most of your money back, right? When do you need to start advertising that property? And when people book, because some people will book 30 days or within a week of that, or some people will book 140 days in advance. While the markets that do that, you need to make sure you're marketing it, 140 days to capture that bulk of people who are doing it. Just to give you an example, the property that we're working on right now, we have under contract, and we're getting it all set up to close on. Well, their high season is in January. They're projected to make $23,000 in January 20, $2,000 in February, and so on. So as you can tell, it's probably either high winter market or for the reason to escape winter or for the reason of skiing and snowing. It's either one of those two. Usually what produces that now during January, because most places don't produce that. So one of the things that we have to do for that property, I said 140. I think this one they do about four months in advance is when 50% of the people will book for that market. Wow. So we have to be working with our virtual designer and stager to have that property advertised next month. Even though we won't have any furniture in it. It won't be done with rehab yet. We'll probably just be getting close to closing on that property. But we have a virtual team coming in so that we can start listing it on airbnb before we even close it on the property because we want to make sure we are capturing that bulk. Because if we don't capture that, that means we're losing out on that money. So we're capturing January starting in September because that's when the average person will book for that market. So those are things to consider when you're entering these markets, not just the people you have on the ground, but it's, why are people going, when do they book? How do they book? What platforms are they normally going on? So all these things are little things to consider and you're able to

handle. I mean, do you go that far? Like, if we have assets and we said, hey, Michael, we're not in this business, how far do you go? Will you handle the whole thing here? Obviously, the fees are commensurate, but is that something to do? I do, yeah. So we're actually doing it right now in another property for someone else in Reno, which she hasn't signed on the dotted line yet. But because of my relationships and that's me figure out how to do this, I essentially built a team and they're all willing to work now. They're contracted and I make a fee and they charge their own fee, but through connecting through me, I hand them over to you and then they will go and essentially build all that out, gives you quotes, get you ideas. And because they work hand in hand with me, they know kind of the expectations of what people are going to make or what they're going to do or what they need, because they've done it on our properties and they've done it on my students properties. So it's like they kind of know the drill. So now we're looking to expand our management company into these markets that we want to get into so that can provide higher rates of returns. So now we're working with different homeowners and people who are willing to manage or do stuff down there. We're looking essentially to find these people and partner with them. And we're helping giving them a discount, at least on the management side, just to enter in that market. But they'll use our services for the furniture, building and designing it, rehabbing it, everything, even if they're local there. But they're using our guy who is not local but he knows how to get the job done. It's so exciting, the tools that have become available. And again, because I'm experienced in the real estate field, I'm listening to and hanging on some words you had said earlier, contractors sourcing people on the ground, taking pictures. I've heard that a thousand times. This is the first time I heard them independently verified pictures. That's the first time I've heard that ever. Because the contractors, there are ways to take pictures and there's ways to take pictures. We're having a third party go in and check to make sure that what we're seeing is what we're getting. I love it. I love the opportunities there to connect with people through technology and really be able to run these things as if you're there, if you're an expert, right, which is why you're doing what you're doing. So do you guys get involved and do you touch on the arbitrage opportunities at all, where folks are leasing and then yeah, I don't necessarily it's not my focus. Would I take one up? Sure. But I don't only because I believe in actually helping people. And I don't mean that in a bad way. Arbitrage people are great, they're doing a service. But there are two things I believe in home ownership. So I want to encourage people to hold ownership because if you don't take advantage of the appreciation, the tax benefits of owning a home, it takes just as much work to learn how to do it with no money down than it does creating a business and doing an arbitrage model. But that's one factor. The reason my focus is just focus on owning, because you have leverage there. But the other factor is I enjoy helping people make money. And so, on the management side, because management and arbitrage are very similar, you're doing the same exact thing. The only difference is who's taking the most risk and who's taking the bigger cut. So obviously the person taking the most risk is taking the bigger cut. So some people, great, hey, I want a stable long term tenant. Give me what I rent of one, $500 per month, and you can subweece it and do whatever you want. So that's the arbitrage model, where that guy will come in and arbitrage it. They pay him fifteen hundred dollars and they rent it out on short term rental. It for airbnb, that's great. But they're taking most of the risk and they're also taking more of the money. But for me, I like to educate, I like to prepare, I like to quit people, hey, if you want to make this money, you can. You're taking the risk in doing it, which I think is worth it. Life is nothing but risk. Being alive is a risk, so I say do it. But also we're just taking a cut and managing it to its best performance while giving you the peace of mind that we're asset managers, not property managers. We run it like an asset in terms of all the valuables inside. We make sure take pictures of, do viable audits. We do security, we do optimizing revenue. So it's one thing everyone always talks about. Yeah, optimize revenue, which typically they'll go with Price Labs, which is great. I use Price Labs. Or they go with smart B and B. If you're a professional investor, you want to utilize these pricing softwares, but I personally think that's not enough. We take another step in the right direction. We like to compare to our markets, and we do a weekly check every Monday. We like to look at how our properties and how they're performing. And so we'll compare against the market because that's probably the best tell. And we'll either add things to our listing to improve its value, or we'll price it differently to improve its value for Occupancy. And the Occupancy numbers changes from market to market, so we won't have one Occupancy fits all. So we'll base it because we know we can make the highest dollar amount for specific Occupancy. Occupancy is very heavy, so we want it occupied. But we don't take that price down until it's like one week, depending on the market. Every market is a little different, but essentially that's, I guess, our model when it comes to management. But that's to say, I guess also in the whole Arbitrage thing, I know I went off on a tangent there. Again, I apologize. But my focus is essentially either helping people make money my point was or helping them own. And Arbitrage, it helps one person make money, which is fine. It's a business, but it's something that we kind of shy away from. Yeah, and I appreciate that because there are some disingenuous things that are occurring in that side of the industry, and there are folks that are not quite understanding what sublet means, and they didn't sign up for what they're getting on the other side of it. Right. So I think that I love it. I love the focus on ownership, building equity. That's how we build generational wealth. Right. So I know we're coming up against a hard stop here. Just two more quick things, if I can, of course, legislative threats. How impactful has it been? Where do you see this going? Are you guys keeping an eye on this stuff as it's rolling out from city to city? Absolutely. Yeah. So one of the things we love doing is we love investing with places that already have restrictions, especially if they have a long history of being a vacation market, because then it usually doesn't change much. They already have their thoughts in place. And if you can get a permit, great. Another thing to do is focus on zoning. If you're in a commercial or mixed use zoning, you can operate a business and search for rental hotel. That's a business. You can get a license for it. And so you're protected in those areas when you already know the rules to play. The places to be wary of is places that are new to this and don't have rules established. And so what you want to do before going in there is you want to call the city or call the county, whatever governing entity is over that area, and you want to ask them, hey, can I have in writing your restrictions when it comes to short term rentals, tourism, lodging, whatever, and you find out if they have anything written. A lot of times they don't have things written in these newer markets. Sometimes they do. So once you know the rules, you can play by that's when you know how to really make good money. But if they don't have any rules, you should be wary, but you can still make good money for time. And you want to see a written because I've even gone to cities and they say, yeah, we don't allow for term rentals in our one zoning areas. I'm like, Great, can I see your zoning and your written rules on that? And the language was there to a degree, but it didn't specifically say, you can't do this activity in our one zoned area. So for that very reason, I took the risk. And I can say because if the city went against us in any way, shape, or form, and this is me pushing the envelope a little bit, hold up in court, it's very difficult to enforce something that you don't have specifically written. If it's not written, you can't enforce it. It doesn't mean you can't change. And I think the more local it gets, the harder it is. But HOA will have something in writing. I stay away from HOA. Well, I'll stay away from HOA. I stay away from Condo HOAs. Because condos can change them. Unless you own the majority of the condo, you don't really have essentially the control, and they're the quickest ones that can split. Cities take a lot longer. County take a lot longer. Love it. Okay, where do we start? If we have no experience and we're looking to just get started, and we need some of that base core coaching, are we pointing them to STR? Yeah, if that's where you want to go, absolutely. We have a coaching program as well as a mentorship and mastermind. That's www.strlegacies.com or www.strmanagement.com. Those are the two ways of getting some information about me or information about our program. We're still revamping a whole bunch of different things. We've been around for about a year that's been fun. And Escape and Stay. Is that for a more seasoned investor? Does that have the asset already and looking to have someone now? Yeah, not necessarily. If you have the asset, you're looking for someone to manage it. Yeah. escapeandstay.com is how you can get there. And then that's our management company that we own, and we have and it's a good asset. All right, Michael, this has been really informative. A lot of value. I really appreciate you taking the time to kind of take it from A all the way through to Z here. Super valuable information. Thank you so much for joining us. Best of luck in the endeavor. And I'm going to reach out to you on that market I was telling you about. I'll flying and get something cooking. Absolutely do. So. I'd love to give any words of advice or anything I can get. All right, man. Thank you so much, Michael Porche, everyone. Stay safe.