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Finding Consistency In Today’s Market With Chris Prefontaine

FWM 2 | Real Estate Market

The real estate market is always going to change. It’s hard to find market consistency. It happened in the crash and it’s happening now with the events of the pandemic. You can’t control the market that is why you have to adapt to it. Find that one niche that you want to master. Understand it and learn how to navigate that niche in the market. Join Julie Houston & Gem Rinehart as they talk to Chris Prefontaine on how to do real estate in your terms. Chris is a real estate coach, author, and owner of Smart Real Estate Coach. Learn how to find your niche in today’s market in real estate. Everything in real estate has already been done. Find a mentor and learn from them.

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Finding Consistency In Today’s Market With Chris Prefontaine

I’m excited to have Chris Prefontaine. He is a best-selling author. He wrote the book Real Estate On Your Terms. He’s also an expert educator in the real estate space, and we are so excited to have you, Chris. We’d love to dive right in.

I love diving in.

Gem had one question for you that she wants to start with.

What did you do before you got into real estate at all?

I grew up in a family business that had nothing whatsoever to do with real estate. It was a welding supply and industrial gas business, but my dad would build his own buildings and rent them back to the company. As a kid, I never used to get that like, “What do you mean? How do you build it in?” Once I figured that out, I started getting intrigued with real estate, but the only tie to real estate was that he would tinker with his own buildings.

I was asking that to ask what you did before real estate, what got you into real estate? What was the pivotal point in your life where you were like, “I’m going to get into real estate?”

I don’t remember like being an a-ha moment. I do remember those buildings and then I remember he would be hanging out with people that did some stuff with land and then I got the itch. This is not political because it didn’t exist back then. I remember reading Trump’s first book. It was ’86. I got intrigued by the deals they were talking about. That’s all. I grew up on it. I went to college, but I had no interest in going to college. It’s one of the big deals.

It became a family business. It grew pretty massively over the years you’ve been investing.

A lot of it was me, meaning solopreneur stuff. I never consciously or education-wise figured out how to scale at that early stage. A little bit before the crash, I had a team of maybe ten people, but after the crash, I purposely sought out people that would help me scale. To this day, we are still with them, and I credit them with all of our scaling, culture, meeting flow, rhythm, and mission values. Everything we learned, it’s all them. That’s when it became more of a business, not Chris muscling it out because that’s work.

I was a solopreneur too when I started buying houses and now I have a small team. It made a world of difference for me, but I don’t invest it at the capacity that you do. Why don’t you tell us a little bit about what investing methods you are using in the market nowadays? What are you finding successful? What’s not been successful for you?

Since post-‘08, which for me was ‘12 because it took four years to dig out, we re-engineered everything we do. The picture now is only lease purchase, owner financing, and what they call subject-to existing financing because none of those require anyone to sign on a bank loan and pledge personal assets, which I tell people do not do unless it’s for your own personal house.

We buy all the properties that way. Now we control somewhere around $80 million in real estate, but little to no money down on any of those. I say little to no because there are exceptions. We bought an oceanfront home as an example. It’s beautiful down at Cape Cod. It was almost a $1 million purchase, and we literally put $8,000 down. That’s an exception to the no money down and it gets a little tough to do no money down all the time, but we usually do.

FWM 2 | Real Estate Market
Real Estate Market: Lease purchase is an easy way in. A deed doesn’t transfer. There’s a lot less risk and stress for a new investor.

I have gotten it down but not that low at a price point, just at $1 million. That’s pretty impressive.

I didn’t answer the second part when you said what’s working now. Right now, you’ve got craziness going on and the way we built the niche coming out of the crash. It was to thrive in all markets. It doesn’t mean they are all easy. The market was hot. It is a little bit more difficult for us. We have talked to a lot of sellers to get a deal.

Now with this pop in interest rates, you saw hundreds of thousands of buyers get pushed to the side because the rates did what they did. Those people now need help and that’s what we put in our properties. They need time to get the mortgage ready again, and then that, therefore, hurts the sellers. It’s not the same demand. It’s happening. I’m hearing it all around the community. It’s neat because our community is like a microcosm of society. When I hear things going on, I know on the broad scale, it is magnified.

Do you do a lot of stuff on terms?

Almost 100%.

Do you do a lot of it with private capital?

We do none. We never raised. We do a little bit. When I say a little bit like people we know, like, and trust, like my attorney and bookkeeper. They see what we do and go, “I got X amount. Can we pocket with you guys?” We’ll find a deal or even our own building. We did a renovation but usually no. We don’t raise money. It’s just if someone comes to us. I will try to find a deal with them.

When you started out and you had no money, what do you think would be maybe the top two tips you would give someone starting out, no experience in this industry of investing? What changed for you that helped you start from zero?

It was by demand. My credit got trashed after the crash. I had no cash. I was negative cash. The lease purchase was the way in because all our agreements have been built with a $10 deposit. I will give you a story about a student in a second, but that’s an easy way in because there’s no money. It’s also an easy way in because a deed doesn’t transfer. There are a lot less risk and less stress. For a new investor, they can start with a lease purchase. You can’t do a sandwich lease in the state of Texas, but everywhere else, you can do what I’m talking about on this one method. They started that. It came to mind. You said that was Brian O’Neill. He’s in Illinois.

Brian came to us. He had no experience. He was an elevator salesman. That’s as far from real estate you could get. He did his first eight deals lease purchase. Each of them had a $10 deposit because that’s what we have built into our pre-done agreements that he has access to. We have the three-payday system. I don’t know if you remember, but we have trademarked that in the US. He amassed like $838,000 and three paydays in that time period in eight deals. That’s a great story and that’s what a new person should do for sure.

For me, I’m happy to be here with you. I have heard you are one of the best. I’m so excited to be communicating with you at all, especially for the experience that you have. There are so many people in the world who want to get to that next level. They don’t know how. They don’t know where to start. That’s what stops most people because they don’t know how to get there. They don’t know what to do.

They don’t know who to communicate to or the next steps to take. Whenever you were in that space where you were just getting into real estate, who pushed you in like, “These are the types of people that you need to speak with? These are the kinds of people that you need to surround yourself with.” What got you to that head space?

Chaos in the market always spells opportunity. Click To Tweet

Was there one person who may have influenced you more than others that pushed you on this path?

I’d say a couple of things come to mind. One would probably be my father because I worked for him when I was younger and didn’t know which direction. Even in my college days, I got married halfway through college. It all would be motivational. It’s all I can remember. He didn’t push me. He encouraged me. That’s all to do my own thing.

As far as one mentor-wise in real estate, there wasn’t one. It’s that I’m always been big on whatever the next six months or a year looks like, find someone that’s done it. As I said earlier about the scaling. I have wanted me to water it down, but it is that simple. All three of us could talk about, anything, it’s been done already.

Here’s an example. David Nurse was on my show once. He’s an NBA high-performance coach. He would coach these kids making $10 million and $20 million. He would coach them on the court. One-on-one. He does that. I don’t think he does that anymore because he’s transitioned to speaking and writing books, but he said to me once, “These guys coming out will sign a $13 million contract.”

They will come in to the gym. Do you know what he does? He takes what they are trying to work on. Whether it’s mental, jump shot, or whatever it is. He said, “We literally we’ll google it. Find someone who overcame that challenge or master that skillset, and then we’ll model the behavior after that.” This guy gets paid a lot of money. The players are getting paid millions and they find someone they model after it.

All that to say, “Just find someone who has done what you want to do,” but here’s a caution I want to throw out. Please don’t find someone who did the business thing. I know a lot of people through their life away, lost their marriage, or lost a kid because they didn’t pay attention to everything. When you connect with someone, make sure you are connecting with the right people.

Where do you see your actual investing company going? Interest rates are going up ridiculously like more and more every other day.

I get excited. My wife asked me the same exact question. She’ll say, “When rates go up, how’s it going to affect you? When this happens, how’s it going to affect you?” We have been going for many years and I still get the same question. My answer is always this, “It’s chaotic right now because there’s uncertainty.”

People are like, “Is the media right?” “No, they are never right,” but who’s telling me which direction I should go in? When there’s chaos like that, this niche flourishes. When COVID first hit, our deals went three-fold up. It’s because I went to the community and said, “This is when you double down. This is not when you retract.” I’m back to scream that in our community now because things are changing.

In the future, I see a massive influx of people, consumers that need a guide. They need a guide. The sellers and the buyers are unclear. There’s still COVID and chaos going on. What do I do with my property? What do I do if I can’t get a mortgage now because of interest rates? These spells opportunity if you know how to recognize it and do a deal. That’s all. It’s not what the media is saying. It’s opportunity.

I have decided to hold for a while until some of the costs of housing goes down a little bit.

Conventionally, I couldn’t agree more. I wouldn’t buy a personal property right now. I would buy it on terms if I could, but t if I had to go get a loan to buy conventionally and buy something on the market, I probably wouldn’t. I’m looking for off-market properties with people that understand the creative real estate and want to do a deal and there are plenty of them. Between us and our community, we do anywhere from a low of 5 to a high of 20 on a given month, and so they are out there.

FWM 2 | Real Estate Market
Real Estate Market: Most people are not ready to throw $50,000 at you because you need funding for a deal that closes on Friday. Give them time to process it first.

That’s a lot right now during that time, especially how creative you are. That’s pretty impressive.

You said earlier the different ways you buy. It changes. Right now, off the market, if you speak to one-third of the United States that are debt-free, they have no mortgage. Not debt free in life but free and clear properties. A third of the property in the United States are. Why not chat with them? Most of them are off the market. Most of them don’t need the money, so they will do terms with you. Most of them understand the tax benefits on and on. That’s what you want to speak to people that want to speak with you.

Moving on to what you are focused on, what do you think your biggest value is for the clients and customers that you work with? What makes you so unique in that spectrum?

The biggest thing and this is a frustration too. You have in real estate, in general, and you know enough people in this industry, you have people coming to us and say, “I took a course on this date or I bought several courses and I spent all kinds of money.” I say, “How’s it working? Have you done a deal?” They haven’t done a deal yet.

We call that bridging the gap. How we do that is aside from our systems and the tools we provide and all that is that we get in the trenches with them and do the deal. They go to a seminar and they go, “It sounds great. I can get rich tomorrow according to that person that’s marketing that.” Life happens and a curve ball comes in and then they think they failed. They didn’t fail. What was sold was a promise of an expectation. It’s not realistic. We are bridging that gap with some realistic expectations. We are also bridging that with interactive coaching in the field doing the deal so that they get to go, “What happened? Why did they say that? How do I do this?” On the spot daily. That’s a big difference.

That’s huge, especially not even to go back to when the pandemic hit, but unfortunately, when it did, social media became the platform for everybody. We were oversaturated with experts. Keeping the message clean and clear that if it was easy, everybody would do it. Let’s be honest. If it was easy, this is something everybody would be doing. It requires a lot of work and follow-ups. There are a lot of systems and processes in place and people need to learn that. That’s the opportunity that you give that most people don’t. It’s shiny object syndrome ever since. It’s a quick way to make cash and that’s not the reality of a serious investor that is building a company in a portfolio.

We scream from the rooftops about this that you mentioned. Our three-payday system, the average is $75,000 conservatively per deal for all three paydays. That’s cool, but the shift from a job, entrepreneurship or a shift from one business to the other, it’s going to take time always more than they think. I’m the first one to say, “If you need money like you need water tomorrow, this is not you. Go fix that first and I will respect then come back because this is going to take some time.”

Once you do that, the return on time and the return on investment are second to none, in my opinion, but you’ve got to be in a position where you know and you are okay with it taking the time. Extreme, for example. We have had students do a deal in 32 days. That’s the record, but we have had a student do a deal on 365 days. We teach the same thing. What gives is that mental shift and all the baggage that people come with, including all of us. It’s life. You got to be prepared that it might take time.

That’s great you relay that message. A lot of people don’t. It’s unfortunate.

It is and everybody is so quick. As you’ve said, the shift from having a job to entrepreneurship in the real estate business takes full commitment. It’s not a one-and-done thing. You getting in the trenches, giving realistic expectations makes all the difference.

I don’t know if you remember Brian Tracy. He was on my show. He said, “I gave him my three-year philosophy of, ‘I tell everybody they should expect to commit for three years so that I know they are committed.’” Everyone says, “That’s good,” and they agree. He said, “I disagree.” It was on my show. He told me he disagreed.

He said, “It takes longer. I have been broke. I have had success. For the first 2 or 3 years, you are going to suck it while you do. The next 2 or 3, you are going to feel like I’m adequately paid, and then the last 2 or 3, you’ll have success. It’s a seven-year cycle.” Since then, I have been screaming about a seven-year commitment, not three, because I agree with him. If I look at my own history, it takes time.

Master one niche and understand how to navigate that niche in real estate. Click To Tweet

That’s a good nugget you dropped right there. If we could all realistically take a look at things that we do, whether it’s our fitness, business or personal life, you put the effort and energy and then we are not going to have results overnight. It could take years like you are saying. Entrepreneurs and business owners need to realize that. Overnight success is not the reality for those folks. It’s not happening at all. In your career, is that something that you struggled with in the beginning? Maybe a quick turnaround. How did you overcome that?

It’s the shiny object syndrome. When I was younger, it was not working quickly enough. This one might work. None of them that are different. Every one of them is a business. It’s going to take 3 to 7 years. I don’t know how I overcame it. Maybe maturity and continuing hanging out with coaches that reinforced that because I have always had a coach I still work with.

Surround yourself with the right people.

You can’t overestimate that enough. Who you hang out with now matters a whole big bunch in more ways than you can put your finger on.

We have had several talks about that. I talked with Gem. She’s younger than I. She’s new in this industry, but she’s killing it in what she’s doing and learning. I keep telling her. I’m like, “If you are the smartest person in the group of people you are hanging around in, you are in the wrong group.”

You want to change your perspective and your mental. Push yourself to feel uncomfortable around some of those people. We have a new partner in our biz. We met on a podcast through a referral. Fast-forward two years, he’s 10% owner of our company. He built the largest fitness brand in the world. Snap Fitness.

He sold it twice for over $40 million each time and he still owns a chunk. I just talked to him. I say that to say, “It’s amazing.” I talked for about 50 minutes and then he had to go. When I get off, I go out. It’s always mind-blowing. I got to sit and think for a minute and journal a few notes and that’s different for me. When you force yourself to do that or get in front of certain people, it does change you in so many ways, some of them for decades from one conversation.

It could take one thing someone says and it totally changes the trajectory of what you are focusing on 100%.

I can honestly say that in the short time that I have been in this space, I have felt the most uncomfortable.

She’s not even on the road. We’ll get her there.

You are doing the right thing if you are feeling that.

A whole new meaning to who you are is who you hang out with has set in for me. That’s why I’m so happy and excited to be working with Julie and to be meeting everybody that I’m meeting.

FWM 2 | Real Estate Market
Real Estate Market: The first two to three years are really going to be bad for you. The next two or three are going to feel like you’re adequately paid. And then the last two or three, you’ll have success. It’s a seven-year cycle.

You should be honored to meet Chris because he is an A player in our industry. He runs a very highly qualified team and business. How long have we known each other, Chris?

It was like 2015 or 2016, roughly speaking. I don’t think I started my show until around 2016-ish. Somewhere around there.

It’s been a while. We have your book. Gem, do you want to share Chris’ book for everybody? We want to share the book, but I want to talk a little more about your training and what you are focusing on with your students and that business area. Do you mind diving a little deeper on that?

We have an academy. You’ll learn it when you go through the book. I will give you a free class. If you don’t mind listening to me for an hour, there’s a free class. You can go to the whole thing. You have an access at that point if you go, “I got this stuff for free. There’s something I want to pursue.” There’s an academy you can go through. It’s online.

The academy is not like a course that you do and then you go, “Got it.” Even our top students like Brian, who I mentioned. They use as a resource center. It’s a living, breathing, constantly updating thing online like post-COVID updates. We run into a snag in the field. We update a contract. It’s updated immediately. You are always current. That’s the first thing we do.

If someone says, “That’s cool. I want to be more aggressive with this. I want you guys to help me,” then there are different hands-on coaching programs that they can apply for. That’s all. It’s do it on your own or do it more faster. Speed the learning curve up and do it with us. Either way, it’s great. That book is not one of those, “Take my free book,” and then you get to put your card in for $6 in shipping. We will do everything for free. We’ll ship it. You get the hard copy. It’s not electronic and you’ll get that out in the next two weeks once we get that request.

If you are interested in getting the book, you can get that at FullerWalletMedia.com/chrisfreebook. We’ll also have a link for the masterclass too. We’d like to send some people to your masterclass and get a deep dive into the basics of what you review there.

It’s an hour. You are not going to be a millionaire after an hour, but you will say, “I get the system now.” It’s 55 minutes or so and it’s free.

That’s totally worth it. I highly recommend checking it out. If you haven’t checked out Chris Prefontaine’s masterclass or any of his work, I highly recommend that for sure. Can you tell us a little more about what you are thinking for 2023? Most people are planning out. We are midway through 2022. I’m sure there’s some pre-planning for 2023. What do you think are some expectations or what are you expecting to see maybe in the upcoming year that’s ahead?

I stay away from the piece of this that could turn into a prediction. Everybody makes a prediction is telling the truth in their mind. In a sense, they are lying because nobody knows. The billionaires don’t know. If you and I knew, we’d be on a beach somewhere. We wouldn’t be on this show. Nobody knows. What I do know is this, the market’s going to constantly change. That’s what it does.

I have been out for many years. That’s what it does. What should you do then? You should get good in one niche and understand how to navigate that niche in real estate no matter what the market does. That’s how we built this particular one. If that’s for you, great. If it’s not the one, I’m not so naive to think the only one is the one I love. Get in something and then master it. Find someone who’s been through cycles and master it so that in 2023, no matter what happens, you are comfortable. As I said, my wife will say, “What about this?” I say, “It’s all great.”

It’s all good. As long as you know how to navigate, you go to sleep at night thinking, “I’m good either way. Let’s bring it.” I will know how to navigate. That’s what we teach our people to do. We have people that I do personally at the higher level. I have people, twelve of them now, that have to voice text me every night. I want to hear their voice. It’s not an email or a text. I want to hear their questions and challenges, and then they have a mini-coaching moment every single day. That’s interacting. That’s working the market.

FWM 2 | Real Estate Market
Real Estate On Your Terms: Create Continuous Cash Flow Now, Without Using Your Cash Or Credit

It’s something unique that most people don’t do. That’s a huge advantage for sure. I haven’t seen that before. We are going to share a link about your masterclass too. For those that are interested in seeing it, we are going to go with FullerWalletMedia.com/masterclass. Is there anything that you want to bring up or that you think would be of importance that we could share with our readers? A good mix of beginners and seasoned investors.

I don’t think we alluded to this direction but similar to what we have said, maybe it’s a good recap. Kim and I were walking. We are in between two beaches where we live. I literally said to her and I’m going to mention this. This would be the first one I thought of it. There are 25 surfers. They do it all year there even though it’s cold in the winter, they surf. You see the waves coming in because it was windy. It was Saturday. Out of 25, 5 of them take the wave and they go in. We are sitting on the bench. I said to her, “This is a perfect analogy for the people in real estate because we have an event coming up for ourselves.”

In the about that percentage will go, “Chris is probably out. I will take that wave and I will run with it.” In two years, I will look back going, “That was amazing.” The other one is still sitting there. It’s the same way. They sat there and it went right past them. If you are reading, there’s nothing stopping you from doing this and creating the lifestyle you want, except for you and your head. That’s all it is. It’s not your grid. It’s not your heart. It’s your brain going. I’m not clear if I can do that. Allow someone to show you the path. That’s all.

That’s a great analogy.

I credit my wife on that one.

Thank you. You should have your wife on next time.

It’s like, “Now is the time.” Nothing is holding you back, literally, but you. I love that analogy. That was awesome. Get on the waves.

As we wrap it up, I want to thank you, Chris, for being on the show and Gem, you too, for co-hosting. It’s an honor to have you on. Do you have any last words you want to share with everybody?

In light of what we said, you can do it. I will leave it simple because you can. I’m not going to muddy the water. It’s all in your brain. You can do it, so you decide.

Thank you so much. We are so glad we have you on.

I appreciate. Thank you so much.

It’s such a pleasure meeting you. I appreciate and value your time. Thank you so much.

Don’t forget to go to FullerWalletMedia.com/chrisfreebook to get that book.

I love it. Thanks.

Thanks so much.

 

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About Chris Prefontaine

I have had multiple careers within the real estate industry spanning more than 25 years. During the 1990’s, I built more than 100 single-family homes. From ’94-2000, I owned a Realty Executives franchise in Massachusetts, before selling my company to Coldwell Banker.

Today, our family-owned business in Newport, RI still buys 4 to 10 properties per month via lease-purchases and owner financing. We have engineered more than $75 million in transactions.

I am passionate about continuing education and helping others grow to their real estate investing business to its full potential. This compelled me to begin sharing my strategies and insight with others who want to build wealth outside their core business. I have coached more than 30,000 people throughout the U.S. and Canada during the last 17 years.

When I meet a new student or partner, I often find they are frustrated with the hours of hard work they’ve invested is not producing wealth outside the business. They feel trapped and ready to give up. They crave straightforward and proven strategies they can apply quickly to get off the never ending treadmill.

Worse yet, most of my students previously purchased “training programs” from other so called “experts” and never received an ounce of support from the “guru.”

My approach is different.

I teach and mentor how to apply the principles of success I use every day in building my business. Most importantly, I love working in the trenches alongside our partners; getting my hands dirty and showing them how to avoid mistakes and where they can succeed.

In addition to working with me one-on-one, our partners also benefit from the collective strength and wisdom of my entire team. We are family-owned business so our partners get all of our expertise — not just mine, and that creates powerful results.

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