Colin Murphy (00:00):
There was, there was a lot of craziness. There was a lot of, you know, you could literally make a phone call saying this, guy’s taking a 50 meter slot in London. Do you want our 80 meter slot? And they will demand it and kind of walk over their dead ground, need to get the aid or meter slot because you’re the guy that had the 50 meter one. So it was, um, yeah, I mean, a lot, a lot of crazy things happened back then. It was a lot of money being thrown around. You had people reserving three properties off plan pre-construction and their plan was to kind of sell to, and by the third, you know, with zero cash from the profits of the first to June, the 15 month construction, there’s all sorts of madness going on back then that I don’t think we quite touch the same levels of during the last, you know, boom we’ve we’ve just gone through now. I think it was a little bit more exuberant. Even back then,
Reed Goossens (00:59):
Welcome to investing in the U S a podcast for real estate investors, business owners, and aspiring entrepreneurs looking to break into the U S market join Reed, as he interviews go getters risk takers and the best in the business about their journey towards financial freedom and the sheer joy of creating something from nothing good day. Good day, ladies and gentlemen, and
Reed Goossens (01:20):
Welcome to another cracking edition of investing in the U S podcast from Los Angeles. I’m your host Reed. Goossens good as always every with us on the show. Now I’m glad that you’ve all tuned into learn from my incredible guests and each and every one of them are the cream of the crop here in the United States. When it comes to real estate, investing, business, investing and entrepreneurship, each show, I try and tease out their incredible stories of how they have successfully created the businesses here in the U S how they’ve created financial freedom, massive amounts of cashflow, and ultimately create extraordinary lives for themselves and their families life by design. As I like to say, hopefully these guests will inspire all of my cracking listeners, which are you guys to get off the couch and go and take massive amounts of action. If these guys can do it.
Reed Goossens (02:07):
So can you now, as you know, I’m all about sharing the knowledge with my loyal listeners, which is you guys, and there’s absolutely no BS on this show, just straight into the nuts and bolts. Now, if you do like this show, the easiest way to give back is to give us a review on iTunes, and you can follow me on Facebook and Twitter by searching at Reed Goossens. You can find the show, every podcast on iTunes, SoundCloud, Stitcher, and Google play, but can also find these episodes up on my YouTube channel. So head over to Reed goossens.com, click on the video link,
Reed Goossens (02:36):
And it’ll take you to the video recordings of these podcasts. You can see my ugly mug for the beautiful faces of my guests each and every week. All right, enough of me let’s get cracking and indeed a day. Sure
Reed Goossens (02:53):
Pleasure of speaking with Colin Murphy. Now, Colin is originally from Ireland. He’s an expert like myself, and he investing in real estate back in 2009. And since then he has bought and sold more than a hundred million dollars worth of us real estate, over 350 fix and flips in Tampa bay, Florida, between 2015 and 2020, he has experienced in a variety of real estate related activities, including buying and hold fix and flipping wholesaling tax lanes, tax dates, foreclosure auctions, note investing, private money. The list goes on, I’m exhausted just going through it. But he also spent many years in Madrid where he was an active flipper and a landlord in Florida whilst investing abroad. Um, and he’s also to top it all off. He’s the host of his own podcast called Colin’s podcast about real estate, which you can find on iTunes. And we’ll get into that a little bit, but I’m really pumped and excited to have another crack. And ex-pat on the show. It’s always great to talk to other experts, but nothing to me, let’s get them out of here. Get, I call them. Welcome to the show you head in today, mate.
Colin Murphy (03:50):
Thank you very much, really great to be here, right?
Reed Goossens (03:52):
It’s a, it’s always great to talk to other experts. I had the pleasure of coming on your show, I think early this week, and it’s just nice to be on the same wavelength as other foreigners. Who’ve come here and made it happen and really created something from scratch. So, so well done. And I can’t wait to get into your story, but before we do, can you rewind the clock and tell me how you make your first ever dollar
Colin Murphy (04:12):
As a kid? And it’s going to be super stereotypical because I’m an Irish man. And I made my first money working in a pub and I was 13 or 14. And I used to go to a pub across the street. I lived in a village in R in Limerick called Castleconnell, and there was a bar called Bradshaw’s and it’s still there. And I used to go there in the mornings, uh, weekends and summer holidays, and literally sweep the floors, restock the shelves, mopped the bathroom floor and do whatever else was, was necessary to get the bar running except the fun stuff, which would have been, you know, pulling the Pines. But I had to get out of there before the barrel opened, but that was my first kind of summer money was cleaning the floors and restocking of her. Awesome.
Reed Goossens (04:54):
Awesome. Obviously being underwriters, you can’t be there during open hours, right?
Colin Murphy (05:02):
Yeah. I mean, well, yes, not, not drinking or not serving drinks, certainly, but maybe walk
Reed Goossens (05:07):
Me through the journey. Obviously I mentioned the beginning, you’ve been investing in the U S since 2009. How’d you get here, like what’s, what’s the story. What’d you get to college edgy as you choose the United States out of, out of all the places to come to.
Colin Murphy (05:20):
Yeah. It’s, it’s funny how it happens, isn’t it? Um, I mean, I’m, I’m 40 years old now and I’m been investing in the U S for about 11 years, but kind of my, my relationship with the USA started when I was in university, I went to the university of Limerick, which was near where I lived and was a fantastic university. And it had a much bigger international student population than other colleges in Ireland at the time. And they had a fantastic work experience program called co-op where people spent the majority of their third year in university working for a company. And so most people would have got a job in Dublin or Limerick, or maybe gone across to London or Manchester, but I always wanted to go to America and I managed, I’m not sure how, but I managed to get a job with New York life insurance company as an intern for my work experience, my third year work experience.
Colin Murphy (06:10):
And this was back in the year 2000 where I spent nine months living in the north Bronx place called Woodlawn. And I used to get the number four train into Manhattan every day, uh, working in his enormous buildings, like 8,000 people working in one building and nine restaurants in the basement floor and its own subway exits and near Madison avenue. And it was just in love with the size of, of everything and the enthusiasm of everybody. And the kind of can do attitude. I had another Irish person literally sitting right behind me and on my floor, New York life insurance. And it just kind of goes to what you said that ex-pats tend to help out other ex-pats. And, and it’s, you know, that’s been my case when I was a kid in New York and it’s been my case when I was a little older as well.
Colin Murphy (06:54):
So I got a real taste of it and I kind of did everything I could to try and maintain that enthusiasm, but it took me a few years to get back here. But the, the experience lasted. I also spent a summer in San Francisco, myself and five buddies from, from Limerick, spent a summer there. And I worked for, uh, another internship called first consulting group thing was an it healthcare. And this was in the top of the.com boom area where everything was going crazy. And I got to travel around San Francisco, visiting hospitals, installing servers in their server rooms, these Cisco 6,500. So it was just a fantastic way of seeing the city were hanging around with a lot of millionaire, 20 five-year-olds and 26 year olds who introduced us to their world. And it just gave me the other sense of you can do anything you want in America, if you’re willing to work hard, if you know how to make, if you know how to network, if you know how to choose the right kind of career path for yourself. And it, it just gave me that a strong work ethic kind of, kind of a can-do attitude and on a level of confidence in myself that a lot of other Irish people might not have had might not. And I only got it myself just from having that exposure to the American market. That’s so
Reed Goossens (08:05):
Interesting that you had a, I guess, was it, uh, was it ingrained in you to come to the United States? Like was just a natural thing? Like I wanted to go and give it a crack over in the U S
Colin Murphy (08:15):
I think that’s something that was ingrained in me. It wasn’t kind of pulled here by anybody with a cousin or a friend or anything like that. I had something in me that was just itching to do more and get bigger. Um, I mean, I was always, you know, always enjoyed widening my circle of friends, always enjoyed networking. I always enjoyed reading business books that other people might not have been interested in. I was always good at kind of getting jobs in, in kind of interesting companies, even when I was in university, I worked for another, you know, worked part time at another company on the university campus, uh, you know, scientific company doing data entry. Whereas a lot of people might’ve been working in a, in a bar or a restaurant. So I was always exposed to kind of white collar people, uh, in, in university.
Colin Murphy (08:58):
And I hung around with, with people that had aspirations to go on to do bigger and better things. And it just kind of rubbed off on me and I don’t know why, but I managed, you know, that first trip to San Francisco and literally just convinced five friends to CODO San Francisco with me. I got a, I got the job in a phone interview, you know, while still in Ireland, then I think, you know, two thirds of the reason I got the job was he, he liked my Irish accent. You use whatever you can. Right. And, and you just kind of go with it and make the most of it, but think it must have been something inside me. And I, I got, I got lucky in a few steps along the way. No, that’s,
Reed Goossens (09:34):
That’s awesome. And yeah, you got to, you got to lean into the Irish accent whenever you came out. I know I definitely leaned into my LZ accent over the years. Um, but tell me, how did you wind up in real estate and where did that bug started? Botting at you from inside?
Colin Murphy (09:48):
Yeah, it, it was kind of accidental. Um, I did, I finished my degree in Limerick and I did a master’s degree in marketing in Dublin, and then I went to London and my first job was working for the Irish times newspaper, which is a pretty prestigious newspaper in Ireland. And they had a London office and I was selling advertising in it. And so I was selling advertising and the main section, the sports section, the travel section, the property section, you name it. And I was there for about a year and a half, and I’d kind of smashed through all the targets that have been set for me. Uh, but my boss kind of screwed me out of a bonus on a technicality. I really didn’t like it. It really didn’t. This was back in 2002, 2003. So I just kind of left. And because I enjoyed for whatever reason, selling adverts in the property section, the most, I kind of looked for jobs that were still something to do with property and advertising.
Colin Murphy (10:40):
And I ended up working for a company called Linden communications who were a little bit of a pioneer in the United Kingdom in that they used to organize property shows all over the United Kingdom and Ireland where you would go to a show in London or Manchester or Glasgow, and there might be 40 or 50 companies promoting real estate. So it might be promoting your Villa in France and another one in Spain, something in Italy, a kind of a condo in, in Orlando, uh, you know, and then other markets came along Turkey and Eastern Europe and south America. And I got to travel to all those places, convincing them to buy space. These exhibitions, I got to sell adverts in the magazine doing the same thing. I used to go on road trips with the journalists, uh, to meet these agents and developers. And I was on the road just going to like 20, 25 shows a year.
Colin Murphy (11:26):
And you’d spend like a weekend in London, a weekend in Manchester, Liverpool Dublin. And you just got to hangout with, with all of these real estate experts from all over the world. And it was a real work, hard play culture. And I just loved it. And this was really kind of a boom in British real estate, Irish real estate, 2003, four five. And I ended up kind of finishing after about three and a half years of that to work for another young that I’d seen kind of grow, uh, you know, with, with that company in terms of, they started out as a little six meter booth and it came to start at the front of the show and they had, uh, basically there were developer over emerging markets and they used to sell, they were the first people to sell real estate in places like Latvia and Lithuania and Billy’s and Argentina first people that bring real estate to the British market.
Colin Murphy (12:14):
So I, uh, they came to me to open up an Irish office for them, which, which I did in, I think 2006. And so I was, you know, I have to open an office, hire sales manager, office manager, couple of other people, and, and promote their real estate to the Irish people. So I was selling properties in Panama and Argentina and Billy’s and Bulgaria and Romania, and traveling to these places all the time and, you know, hiring rooms and hotels to do seminars and, and kind of trying to publish our own newsletters and magazines. And it was, uh, it was a very exciting time for a few years and on until it wasn’t until 2008 came on.
Reed Goossens (12:53):
Well, I think you have such an incredible story because that is definitely unique and selling real estate in such unique places like Bulgaria, or, you know, I think you said Bolivia, you know, it’s the Eastern block. Tell me a little bit about what they were selling. Was it these condos? Was it cash flowing assets? Was it, you know, cause when I think of selling stuff, I think of when I moved to the United States in 2012 and a lot of Aussies were being sold, these, these, um, what do they call them? Turnkey properties, right. Was it similar turnkey properties that you were selling back in the mid two thousands? Like in these other parts of the world,
Colin Murphy (13:24):
It was, it was a bit of a mixture to be honest with you. It was a very, very ambitious company. And you know, a lot of it was lifestyle orientated, more than investment orientated. For example, they had an eco resort in beliefs, which is in the Caribbean where they’re literally building a village in the jungle and they had another resort on the waterfront, in, in Belize where there, it was kind of luxury apartments with a clubhouse and a swimming pool and pool bars and people were kind of buying for the lifestyle. But back then, there was always an element of, you know, you’re, you’re buying it for the lifestyle, but you can also make money and it was pretty construction. So you’re kind of putting down a 5% deposit and then you’re kind of paying in stages as the property gets built. And oftentimes it was developer, you know, would rent your unit back off you kind of these short-term hotel let’s um, you know, some of it was just speculative.
Colin Murphy (14:16):
You, you kind of fund a development of a resort and you can exit a few years later, I, some of this stuff in Eastern Europe, they were doing like a ski resort in Bulgaria as a kind of an affordable option for the people that couldn’t buy kind of a property in the ski resorts in Italy and Spain and France, which were very, very expensive. So people started doing it and in Eastern Europe, I mean at the time it was developers are doing all sorts of ambitious games that on people that might’ve previously been nervous to buy outside, their hometown were suddenly thinking, well, I might as well let’s buy a condo in Bulgaria. Why not? I mean, it just, it was a really, really unusual time, but it was mostly lifestyle related and, you know, there was an income generating part of it as well, but it was, yeah, you’re right. It was a very wide selection of places in a very wide selection of countries. Yeah.
Reed Goossens (15:07):
It’s fascinating. And definitely things that you see and you also mentioned booths and trade shows and real estate trade shows. And I, you know, I feel like when you go to a real estate treasure in the last 10 years has been like the boom of real estate trade shows, but you sound like you were going to in the early two thousands, was it still as booming back then or all, or the different tragedies now with sort of the investment side really focused on rather than the lifestyle side?
Colin Murphy (15:30):
I think it was probably a little bit crazier than, than w I know there’s been a boom from 2012 to this year, but that came on on, on the back of a very tough crash that a lot of people suffer from. Whereas, uh, you know, the, the boom that lasted from 2001 to 2007 was far more exaggerated than the one that was from 2012 to 2019. And just in terms of the amount of craziness that went on, I mean, you had prices even in Ireland, prices were, were tripling in seven or eight years, and you had the same in a lot of other cities. And that was one of the reasons why people, you know, I was dealing with British and Irish buyers back then more so than mostly dealing with American buyers now. But, you know, people were really losing their own themselves. The economies were growing very, very fast.
Colin Murphy (16:21):
People were able to borrow money at very low interest rates thanks to being in the European union. And there was, there was a lot of craziness. There was a lot of, you know, you could literally make a phone call saying this guy’s taking a 50 meter slash in London. Do you want our 80 meter slot? And they will demand it and kind of walk over their dead granny to get the aid or meter slot, because you’re the guy that had the 50 meter one. So it was, um, yeah, I mean, a lot, a lot of crazy things happened back then there was a lot of money being thrown around. You had people reserving three properties off plan pre-construction and their plan was to kind of sell to, and by the third, you know, with zero cash from the profits of the first to June, the 15 month construction, there’s all sorts of madness going on back then that I don’t think we quite touch the same levels of during the last, you know, boom. We’ve we’ve just gone through now. I think it was a little bit more exuberant even back then.
Reed Goossens (17:15):
Yeah. So now let’s pivot into the, um, the U S real estate and moving to Tampa. When did you come back to the U S throughout that journey and, and pitching all the foreign deals and to the Brits and to the Irish. When did you come back to the U S and why did you started to invest in Tampa, Florida?
Colin Murphy (17:34):
Well, it was back, we started looking at it in 2008. When our, you know, the company I was running in Dublin was like I say, promoting real estate in emerging markets. And the global economy was basically collapsing and the kind of market pre-construction investing, just evaporated and obviously developer finance, far, it evaporated as well. So the whole business model was, it was kind of going up in smoke and very quickly. So, uh, unfortunately I had to let go of a few staff, but I had a sales manager that I kind of hired who was about six or seven years older than me, and had a lot of experience in real estate and, and took like a significant job, but just to work with the kind of office I was running, because he liked the company and he had a, his name is David Shaw. And he bought a property in Orlando in the early two thousands.
Colin Murphy (18:22):
And it kind of exited out of in 2006, just before the crash. And he was aware of the condo market and he was aware that things were getting wobbly in, in Florida real estate and, and thought, well, you know, if nobody wants to buy pre-construction real estate wide, if we can sell them highly discounted properties that are already built in, in the, you know, the most, the biggest and most, you know, some ways the most stable economy in the world. So I will tell me more. And so we let’s see, he kind of convinced me, let’s, let’s get a flight to Orlando, we’d meet up with a few agents and developers and we’ll see what kind of inventory we could sell. So we went over there with nothing other than kind of a track record in selling investment property to British and Irish buyers. And we were talking to these developers who had gotten caught out with their condo conversions.
Colin Murphy (19:12):
And, and as you might remember, well, even though this being a multi-family, but in the early two thousands, people met absolute fortunes from buying an apartment community, which is like a single entity and dividing it into individual condos, maybe fixing up the units as they went along and then selling them individually. So you might buy something for 10 million and ended up selling it for 15 or 16 million after literally just subdividing the units. And a lot of people did that, those condo conversions, I made a lot of money in the early two thousands, but the people that did it in 2006 and seven, uh, got really badly caught out because finance for condos just completely evaporated for, for years. And so these developers had to try to find buyers and they ended up tenanting a lot of those condos, just so they could earn income to pay off those big mortgages they were servicing.
Colin Murphy (19:59):
And then you had people like me coming over and we were pretty early to that game. We said, well, look, you’ve got this 200 unit community. Nobody’s buying them at the $240,000 a unit. You thought you were going to get you’re, you’re kind of far sailing now, but give me exclusivity on, you know, 30 or 40 units, I’ll collect the fee as a, kind of a middleman and international marketing agent. And I’ll, I’ll send them all to cash buyers for you. And I’ll have this, you’ll have cash for these 40 or 50 units in the next 40 days, 50 days just let me promote them. And we went back and created some glossy brochures and price lists and fancy photos, and I just sold them. And we got a reputation around Orlando for doing that. So we promote a lot of condo communities in, in Orlando and also other parts and some in Tampa as well.
Colin Murphy (20:48):
There’s a beautiful community called Waterside of Coquina key in, in, in St. Petersburg that we promoted that David and his wife Catherine later moved to. So we just got very good at promoting these condos that were priced at like 70, $75,000 in 2009 and 10 and 11. And would’ve been setting for 200, $220,000, just three, four years earlier. And these were, were built recently converted recently renovated often rented out for nine 50 or a thousand dollars a month. And just the idea of buying a high-quality condo for $70,000 is rented for a thousand dollars is it’s just crazy. Now, if you could, I mean, when you think of all the great deals we promoted and salty, you just wish you kept more than, but it was a, that’s how we kept the lights on. That’s how we pivoted and, and, and just created a, a new company owned by myself and, and David and his wife, Catherine.
Colin Murphy (21:40):
And we just kind of went from strength to strength and you know, that all of a sudden unreal estate in Florida for 10 years, and, uh, you know, the kind of low hanging fruit just kind of went. So, you know, it wasn’t a surprise. It took, we were early to that. Pronic promoting distress condos. And we had that market to ourselves for a little bit, whereas maybe some other small guys, but it was around 2011 and 12 bigger fish started circling and they would, you know, control a hundred units or 200 units. And then they would try and, you know, be a master agent. Then we would be a salvage agent or, you know, prices just started going up. And, and whereas we used to sell kind of be quality places for 80, $85,000. Now we’re being offered, maybe see quality areas for a hundred thousand dollars.
Colin Murphy (22:22):
And it just started getting a bit silly. We were like, no, I’m not promoting this stuff. I don’t want to do it. And so we just had to take a pretty big decision to that. We stopped doing it and we have to reinvent ourselves again. And this is a common theme in any entrepreneur that’s been in business, you know, 15, 20 years, you kind of have to do a big reinvention every five or six years, and went from obviously selling the emerging market stuff to promoting kind of condos as an international marketing agent. And then in 2013, 14, we had to decide to plow a lot of the money. We’d retain a lot of money. We’d earned it to seeing if we could be a house flipper and just kind of buy our own real estate, fix it up. And NCFR our investor database will be interested in that. Interesting.
Reed Goossens (23:03):
Now it sounds like, well, two things that I just took out of that was probably your integrity to not fall into the trap of the frothiness. When markets start to get a little frothy and you’re not selling bad quality investments and potentially could end up in jail or have a really bad name for yourself if you went down that path, because that was probably what you’re seeing. So how do you keep that integrity at the forefront when you’re so young as a company, when you’re trying to keep the lights on as you, what you’re
Colin Murphy (23:29):
Trying to do? Well, I mean, your, your reputation has to be sacristan. I mean, you really have to care for your reputation. You really have to care because we were dealing with, with real people, we were dealing with people that were spending their savings, their life, and their pension money on properties. They knew nothing about we, I mean, we originally had a lot of British and Irish investors, but later we had a lot of American investors all over the country. And, and for them to spend a hundred thousand dollars on a condo in Orlando was a big deal. We weren’t dealing with a hedge fund. We weren’t dealing with a family office. We weren’t, you know, it wasn’t anything like that, but even regardless, you just can’t, you can’t sell something to people that you think is a bad deal. I could never, I could never do that.
Colin Murphy (24:13):
And I mean, I’m not, you just have build a reputation like that. People aren’t going to refer business to you. People aren’t going to come back to you for more deals. And when stuff goes wrong, you’ve helped people get through it or you help them fix it. If somebody needs to sell quickly, you help themselves. We can do whatever you need to do to, to maintain a clean reputation. Because as you know yourself from having one, it takes a very long time to build and a very short time to destroy. So, you know, we were never kind of tempted to kind of take that shortcut or take that quick book or sell I kind of a crappy house to, to some unsuspecting, you know, lady and Manchester. I mean, it would just never even occurred to us to do it. And, and, you know, thankfully I had business partners that followed along the exact same lines of me. There was never a tug of war over, you know, something to do or not. It was, we, we always did the right thing. We always looked for good deals to promote the people and good deals to buy and sell to people,
Reed Goossens (25:12):
To hop on it a little bit, because so many people have been burned with that international trade of this sort of on paper. It’s too good to be true type of staff, the returns. And, you know, I know people in Australia who have got really, really burnt in it, and it’s good to hear from yourself as a, as an early operator that you just, you drew the line in the sand and said, I’m not, I’m not gonna be Hawking C class product for a hundred thousand dollars. When only a couple of years earlier, I was always selling bay cost product for $75,000. So I think that’s kudos to you made in, in, in being in the early in your career, it would have been, um, it’s good to build that foundation off because as you said, like you can, it takes years to build a reputation and you are dealing with people’s money’s people’s life savings, peoples everything. And so you have a fiduciary responsibility to make sure that you’re doing the right thing by them, because you want to be here for the longterm. You want a, you want a business that lasts for 20, 30, 40 years. So, um, so, so well done. Um, now let’s pivot into what you’re doing today and has that lasted longer than five years, because you mentioned before every five years got to continuously be pivoting, but I think you’ve been flipping for quite a long time. No,
Colin Murphy (26:15):
Yeah. I mean, we started our, I think our first couple of flips were in 2014 and, you know, I mean, I, I guess sometimes people make a killing on their first few flips, but I think you’re probably better off struggling, like your first few. And we did, we, as in, we worked very hard and it took longer to sell it. And we ended up making, you know, we ended up making money, but far less than we thought, I think maybe, you know, $4,000 profit between three people after four months of work, you know, and, and we’re like, Jesus, do we want to do this again? And we’re like, yes, because this is what we did wrong. And this is what we’re going to not do the next time. And we made the mistake of doing a couple of flips out of state, which is, I don’t advise any of your listeners to do.
Colin Murphy (26:57):
I mean, whereas, you know, if you’re based in Tampa, don’t go buying a big house in Charlotte and I’m trying to renovate it is just hard work, but we, once we went and I know you said this to me as well, that we went, we only really achieved through success, like financial freedom success when we went very, very deep in America. So, you know, whereas I had a history of kind of promoting real estate all over the place, all over the world. Uh, I only really became properly successful after we focused on a small neighborhood in Tampa called, you know, west Pasco county and little town called port Richey, Newport Ricci, literally a string of suburban houses, about eight miles from north to south and, and three miles from east to west. And we literally bought, you know, about 400 houses in there. And there were all these kind of cookie cutter, concrete blocks, single family homes built in the seventies and eighties.
Colin Murphy (27:49):
And they were just very easy to, to renovate and very easy to kind of scale up because, you know, when you’re, when you’re doing renovations, if you’ve got like seven renovations going on and they’re all a couple of blocks apart, you can send your crews just in a circle. You, you go in here in the morning and you paint this and then you go over there and you paint that and a roofer would go here and then go there. And the AC guys, so we were able to scale it up and, you know, it was like 2014. We did about seven deals, 2015, I think we did 20. And then it just kinda kept adding about 80% every year. So went from 20 to 40 a year and then 60 year and an 80 a year, and then did about 110 last year. And, you know, bear in mind that I was living in Spain for a lot of this.
Colin Murphy (28:31):
I only moved to Tampa about three years ago, mid 2016 when the business was just growing too much. And, and David and Catherine, I knew the guys on the ground were kind of going, this is just too, too busy. Colin come over. I got out of it, you know, cause it, it just got a bit silly. So I moved my wife and my kids from a cozy, cozy lifestyle in Spain over to the, you know, kind of cut and us of Tampa. And, um, you know, we’ve, we’ve loved it and it, it helped grow the business significantly. And it was all all sold to Americans now, like I haven’t sold to an international buyer for a long time. I think I did sell something to a French guy in, in the Caribbean recently, but the vast majority of our buyers are out of state, uh, Americans and, and we, we been selling them renovated rental.
Colin Murphy (29:18):
So the people that want to build a rental portfolio, so listed very, very little on the MLS all also to investors. So we’re kind of continuing that kind of core skill. We developed way back in the early two thousands where we were building relationships with investors, taking care of investors, getting repeat business and referrals from investors. And we just kind of continued dash through through the years. And, uh, obviously we’re in a different space in the market now, and we’re not, you know, the, the kind of the volume for activity isn’t the same now as it was last year with, with this whole lockdown and the coronavirus and everything else. But we had a fantastic run the last five or six years.
Reed Goossens (29:54):
That’s, that’s incredible. And what type of size of assets are you buying? Is it in the, you know, a hundred to 150,000 or two 50 to 300? Like, what’s your sweet spot?
Colin Murphy (30:05):
My comfort level has always been affordable, lower middle class single family homes, which are typically 1200 to 1400 square feet, three bedrooms, two bathrooms, one car attached garage. And, uh, after a pair of values in the one 30 to one 60 range, and I’ve always liked that because that’s, that’s what I call the kind of a Goldilocks property. It’s, it’s above the low-income stuff, which can cause problems with, uh, you know, tenant retention, property management repairs, section eight, housing it’s below the upper middle class stuff. Those buyers are more price sensitive. Your, your rental yields tend to be lower. You know, you don’t rent a $400,000 house for twice, a $200,000 house and so on. So that kind of lower middle-class home was always our sweet spot. And I always kind of figured that as you position yourself kind of one or two rungs below the middle of the ladder, you’re always going to have demand. If there’s a boom, you’re going to have people moving out of, uh, kind of multi-families and, and kind of cheaper houses into these nice single family homes. And if there’s a recession, you’re going to have people downsizing from the big pool homes and the newer houses into these kinds of more modest middle-class houses. So there’s oldest the most amount of people that can kind of buy and rent in that lower middle class, suburban the $150,000 area. And is, is it still does very well over the
Reed Goossens (31:27):
Years. That’s awesome. And how has COVID started to impact the business and what are your sort of your crystal ball is showing, you know, in the future here with, with your business and how it’s going to evolve?
Colin Murphy (31:39):
Well, it’s changed our business a lot and changed mine a lot. I mean, we generally had about 20 properties in the pipeline at any one time, and now we’ve got like three or four, just for the simple reason that, uh, like housing has had an unusual reaction to the pandemic in that prices have accelerated beyond what they normally would, which is sounds a little bit backwards. And, and it potentially is backwards because you’ve had a, you know, obviously as a response to the, the pandemic, you’ve had record low interest rates, you’ve had record government money, propping up asset classes of every type. And you’ve had a lot of sellers taking their homes off the market. And so inventories is lower than normal interest rates are lower than normal, and there’s more money kind of circulating in the market and everybody’s been refinancing and everybody’s been hoarding cash.
Colin Murphy (32:28):
And it’s just prices in, in that area. I described here like 10% higher in June 20, 20 than they were in January, 2020, a 10% jump in six months. It’s just absolutely nuts. And, um, so I don’t necessarily want to dive straight into that because it’s, it’s margins are super tight profit margins for flippers are getting super tight and, uh, your, your natural inclination, if you are a kind of a cautious, you know, business person, which I would consider myself to be, if you would kind of assume in November last year that you’d sell it for one 50 and in a pandemic it’s I might decide what I’m going to assume that it’s going to sell for one 40, just to be safe. So I’m going to offer this guy, whether it’s a wholesaler or, you know, uh, an, an auction or I’ll offer them 10,000 lists.
Colin Murphy (33:14):
And I’m going to assume that it’ll take me four months to sell it instead of two or three months to sell it. So your, your kind of criteria has got a lot tighter. You’re offering less than you were, but at the same time, prices are going up. So you’re not going to be buying much, are you, unless you’re just throwing caution to the wind, which I’m not. So, uh, you know, that’s, it’s a funny situation. I think there’s gotta be some sort of correction, uh, in the near future. Um, but we’re not seeing it yet, and I’m not diving into be a property flipper in, in a market that’s kind of, so artificially inflated, I think you’re safe enough being a buy and hold person. Cause you’re, you’re literally putting down a 20% deposit at a record, low interest rate. If you own the property for long enough, if you have a good manager, you’re the longterm benefits of real estate haven’t changed.
Colin Murphy (34:00):
You got all those tax advantages as an inflation hedge, you’re getting a attendant to pay back. Your loan is still a good time to be an owner. It’s not a bad time to be a lender, either I’m lending money to some flippers because you’re, you’ve got, you know, so short-term to short-term play and you’ve got a bunch of equity in the loan, but it’s, it’s a funny time to be a flipper. And I’m kind of adopting a bit of a wait and see mode at the moment. And, um, yeah, we’ll see what happens. I think our product type is probably more resilient than most the higher priced houses, like the seven, eight, $900,000 houses. Those are, those prices are already kind of trending down, but the affordable middle-class stuff is suburban, low density housing, uh, is, is I think it’s very, very resilient and it’s still doing very well
Reed Goossens (34:45):
Pivoting with recurring revenue in your business, given that you also is the business so heavily reliant upon the profits from the flip, or you just mentioned before, you’re starting to pivot a little bit to lending so you can keep the doors open the lights on.
Colin Murphy (34:59):
Yeah. I mean, any, any business owner has to remember that, you know, once your, your, your business is your active income, you know, but you have to, you want to do something with that active income. You want to try and turn it into passive income. I mean, that’s really what it’s all about. And, and, you know, for the last couple of years I’ve been doing that. So the businesses is throwing off profits, and obviously you can reinvest those in the business and keep doing more, but you, you kind of get to a stage in your business where you might be able to raise enough funds privately to scale up your flips, or you’re throwing off more profits. And then for me, the smarter thing to do, if that was, was to take money out and just invested passively and build my own rental portfolio. So started building, you know, buying houses around time by buying houses out of state so that I’m not totally exposed to the Florida market.
Colin Murphy (35:43):
So I own real estate in Spain on real estate and Alabama, I own real estate in Ohio, and I’m kind of diversifying away from just being in landlords. So I’ve invested in, in low notes that pay off a fixed return, uh, you know, lend money to rehabbers and other states. So you’re, I’m just diversifying a way. So your, your active money from your business of see firstly goes towards your business and secondly goes towards paying your own kind of family expenses and keeping your lights on and your mortgage on and your kids in schools and all the rest of it. But once you kind of get past that as a business owner, and you should always be aiming for that is, is you gotta take your active income off the table and try and grow it into passive income streams. And if you do really, really well, your, your passive income will one day be greater than your active income. I mean, that’s, that’s the holy grail, right? That your business throws off one amount because you’re working your off, making it happen, and then your passive income throws off another amount. So that’s a, that’s something a lot of people need to spend more time on. And it’s something I wish I started doing earlier in my career because it makes, it makes all the difference,
Reed Goossens (36:44):
Right? Well, but it’s also to do with understanding when to pivot and looking at the markets to see what’s coming down the road and being prepared for that. And I think it’s important to take profits from a business and reinvest them in diversify into those passive income vehicles in order for the rainy day funds essentially acts like a rainy day when, when you are actively buying right now in the business. And, um, you not solely reliant upon that business, you know, keeping a roof over your head or keeping the kids in school, food on the table. So I think it’s, it’s, it’s, it’s really, really important. Um, Colin, look, we’re coming to the end of the show. And, uh, before we wrap up here, we’d like to dive into the top five investing tips. You’re ready to get into it. Yeah. Go for it. Question one is what is the daily habit you practice to keep on track towards your goals?
Colin Murphy (37:32):
Well, I, I enjoy quiet time. I think is very, very important. I get up in the morning at least 45 minutes before everybody else. I spend about half an hour reading a business book. I read fiction in the evenings with my kids. I read business in the mornings on my own. And it’s also an idea to go through, you know, your, your personal goals. I know we have them on a phone, on an app and I read through them. And I think that kind of, um, that’s important. You need to be aware of your goals. You need to read them, memorize them, read them every day. And just having some quiet time to yourself is vital. I think. And if you’re the kind of person who just gets up and is immediately surrounded by kind of family and work on and just getting on the kind of daily thread of life, you’re going to find it very hard to take that step back to work kind of on your business, on your goals instead of being in the trenches. So having a bit of quiet time in the morning is, is my kind of key time for figuring out where I am. If I’m moving in the right direction, if I need to make some changes,
Reed Goossens (38:30):
Uh, it’s super important to have that quiet time in the morning. I completely agreed as to set yourself for the day and then go off and, uh, and make it happen. So awesome stuff. Um, question number two is who’s the most influential person in your career to date?
Colin Murphy (38:47):
I think that would be my business partner, David Shaw. I hired him to be, uh, you know, my sales manager in the Irish company back in 2007. And we set up [inaudible], you know, with his wife, Katherine, and run that, you know, for 10 years straight, um, you know, with each other, every step of the way that we started off with a couple of thousand dollars and in a small, bulky apartment in Dublin, and grew it into a multi-million dollar business with a lot of moving parts and, and supporting a lot of people’s livelihoods. And, you know, we were just, you know, when I was in Madrid, Spain working on the business, it was him that I was talking to every day for an hour or more every day, just working out strategies and ideas on the, I think we helped each other, uh, kind of get to, to where we are today. Great.
Reed Goossens (39:34):
I love it. I think those types of people in your life is so important to help you both support each other right now, you know, you’ve got someone else in the boat with you rowing in the same direction, so awesome stuff, uh, in your business, what is the most influential tool? And when I mentioned tool, it could be a piece of software, or it could be a physical tool, like a phone or a journal. So, so what is it that you can’t run the business without on a daily basis?
Colin Murphy (39:59):
Yeah, I actually got this one from Lee Carney. Who’s a big single family home investor in Tampa. And I went into his office a couple of years ago and I saw that he had six screens on his desk, all like three and then another three on top of each other. And he explained to me how it worked and he had his email on his calendar and this one, any of the options on this one. And he had, you know, the MLS on that one and I was just blown away. And the next day I went out and bought two additional monitors. So now I’ve, I’ve 3 21 inch monitors and it just transformed my productivity. A big part of my job was, was sourcing properties. So just to have the public records on my calendar on one screen, the MLS on, on another screen and on a spreadsheet on another screen, I’m being able to go back and forth to underwrite the different properties. It literally, I was working three times faster with, with those three screens and it was a $200 investment than if you have the ability to do it. Uh, I mean, get, get that slightly bigger table if you need to. And by those two extra monitors and it’s, yeah, it’s just, just a fantastic way to work.
Reed Goossens (41:04):
I completely agree. It’s some, it’s, it’s awesome to be able to have a couple of things open at once. You can quickly visually dance between the two of them or the three screens, whatever you might have. And it’s just, uh, it is very, very productive and increases your productivity over time. So I’ve actually never had that. Anyone answered that on the show before. So you’re the first one more screens on the desk, more visual cues, so awesome stuff. Uh, question number four is what has been the biggest failure you have that has occurred in your career? And what did you learn from that failure?
Colin Murphy (41:35):
I think one of the biggest mistakes we made was, was renovating houses out of the state. You know, that almost knocked us out of business before we even got started. You know, we put a lot of our money in those houses in Charlotte when we were based in Tampa and we could have easily lost, you know, significant six figure sums on those two or three houses. And, and it was a minor miracle that it didn’t happen. Thanks to probably David just kind of decamping to Charlotte or spending a week a month there for several months, but that, that can happen sometimes when you start off being a property flipper, you can almost have a disaster during your first couple of deals. And, and some people have had that disaster and it can be very, very painful, uh, or impossible to recover from a six-figure mistake earlier in your career. And it, that almost happened to us. We kind of narrowed it by the skin of our teeth, but, uh, yeah, if you’re gonna make mistakes earlier in your career, try and make them small mistakes, don’t, don’t go reaching for the, for the sun too quickly. And we just didn’t have the reserves to kind of get through that. And we were, yeah, we very narrowly escaped the visitor and wouldn’t have got through the next 350 deals if we didn’t manage to get out of that one intact
Reed Goossens (42:39):
Long as, yeah. Yeah. I remember flip flipping a house from LA, uh, in Philadelphia. It didn’t go well. So gate for keeping, keeping your eye on it, even when you had a business partner boots on the ground, that stool had issues. So it can be really, really challenging. Uh, Colin, last question is where can people reach you to continue the conversation they want to be in your sphere? Where do they
Colin Murphy (42:57):
Go? The easiest place to find me is on my website is Collin investments.com. That’s C O L I N. investments.com. Uh, you’ll also find me on LinkedIn. You’ll find me on, on, on Facebook. I have, uh, Collin podcasts about real estate is my show. You’ll find that in all the usual places, but that, that website called investments.com, you’ll find some reports and videos, my contact information. You can schedule a call directly with me on, on my calendar, if you like, and a very happy to chat to any, anybody about anything relating to real estate or growing a small business.
Reed Goossens (43:31):
Awesome stuff, mate. Well, look, I want to thank you so much for jumping on the show today. I just wanna reflect some of the things that I took away from today’s show. And I think the first thing for me is, is integrity. First, you, you, you know, early in the show, you mentioned how your integrity was so important to you at the early stages of your business. And you weren’t going to be sucked into this vicious cycle of trying to oversell bad product to your clients back home who had just mom and pop type of investors who had their life savings investing overseas. And you really took the fiduciary responsibility to make sure you’re doing the right thing. So I thought that was really key, but also thought that was what was quite, um, intuitive of you is your statement about continually pivoting the business every four to five years as things change as the market changes.
Reed Goossens (44:13):
And I think it’s super important for everyone to hear that as a real estate investor, you want to be in one asset class forever, but you might not. And then having the ability to pivot really quickly, uh, and see what’s coming down the road, uh, and have your sort of other ancillary income streams set up in a way you won’t be sideswiped if the market changes from COVID or, or the frothiness comes to the condominium market or whatever it might be. So I think it was really, really key to continually pivot your business every four or five years. So, um, did I leave anything out?
Colin Murphy (44:45):
No, I aye. I that’s very well put and very well summarized. You summarize it better than I did, and I think you need to be willing. It’s a kind of a balance. I mean, if you’re not willing to take any risks in business, you’d probably end up working for someone who is, and you do need to keep changing. You cannot keep doing the same thing year after year after year, you’re going to get to a stage where you’re going to have to change and you should change because that’s how you grow as, as a business owner. And what I’m doing, what I’ll do for the next five years is going to be different than what I did for the last five years. Just as what I did from 2009 to 14 was completely different to what I did from 2014 to the 2019 or 2020.
Colin Murphy (45:20):
And that’s, that’s fun. I mean, you can, if you want, you w who wants to live the same year again and again and again anyway, right? I mean, you want to try new things and you want to get yourself in a position where you can try new things, or we can make mistakes and when you can move on and that’s, that’s what it’s all about. And, and real estate can kind of give you that freedom and can kind of give you the freedom to work with interesting people and talk to interesting people and, you know, explore and try new things. And, you know, I’m very happy. I kind of fell into this business because it kind of could’ve fallen into anything, but it just kind of fell into real estate. And I’m very glad I did.
Reed Goossens (45:53):
Awesome. We’ll look, we’ll, we’ll put, um, and I want to thank you again for taking some time out of your day to jump on the show, enjoy the rest of your week and have a great weekend. Remember to wash your hands and we’ll catch up very, very soon. Well, they have another cracking episode jam pack with some incredible advice from Colin and just incredible story. Him coming from Ireland, gum, moving to Spain, creating a business internationally, being at the coalface of selling product from around the world, from Bolivia to the Eastern block of Europe, uh, all the way through to Italy and, and more so, really, really interesting remedy to head over to his website, um, uh, colon investments.com and we’ll have all the links from today’s show up on my show notes. So please do go check them out and you can definitely find Colin and his podcast online. It’s Colin Murphy podcasts about real estate. Uh, check it out on iTunes or wherever you podcast attributed. Google it pretty easy to come up with that. And, uh, I look, I want to thank you all again for taking some time out of your day to continue to grow your financial life view because that’s what we’re all about here on this show. And we’re going to do it all again next week. So remember be bold, be brave and go give life a crack.