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Instead of racking up rentals by simply buying existing properties and renovating them, what if you were to physically build your rental properties from the ground up? And what if instead of keeping all those homes, you sold many of them and built a great business and brand as a homebuilder? In this episode, Jeff interviews George Hale of Woodhill Homes, a top-notch homebuilder in Oregon. Jeff and George discuss why sex sells when it comes to homebuilding, how to decide whether to keep or sell a new home, the value of adversity, the idea that in every negotiation, someone is lying, and so much more.
Episode Transcript
“Yeah, sex sells. But what that means to me is that people act on emotion. People buy on emotion. And it’s my belief that people want to drive up to a house and they want to look at it, and they want to feel good. They just want to be proud. And so when we approach building things, selling things, making it look good, putting quartz counters in, putting hardwoods in. This is what I tell my team. I always remind them, hey, sex sells. So what that means is that the nicer it looks, the better it looks, the more it’s going to sell and the easier it’s going to sell.”
Welcome to Racking Up Rentals, a show about how regular people, those of us without huge war chest of capital or insider connections, can build lasting wealth acquiring a portfolio of buy and hold real estate. But we don’t just go mainstream looking at what’s on the market and asking banks for loans, nor are we posting We Buy Houses signs are just looking for “motivated sellers” to make lowball offers to. You see, we are people-oriented deal makers, we sit down directly with sellers to work out win-win deals without agents or any other obstacles, and buy properties nobody else even knows are for sale. I’m Jeff from the Thoughtful Real Estate Entrepreneur. If you’re the kind of real estate investor who wants long term wealth, not get rich quick gimmicks or pictures of yourself holding fat checks on social media, this show is for you. Join me and quietly become the wealthiest person on your block. Now let’s go rack up a rental portfolio.
Thanks for joining me for another episode of Racking Up Rentals; show notes for this one can be found at www.thoughtfulre.com/e103. Please do us a big favor by hitting the subscribe button in your podcast app. It really helps fellow thoughtful real estate entrepreneurs to find this show; onward with today’s episode.
And in today’s episode, I’m really pleased to share with you an interview I recently did with a great real estate entrepreneur and a friend of mine, Mr. George Hale. Now George can bring all sorts of different perspectives to our conversation that we don’t normally get to have on the Racking Up Rentals show. George is a home builder, he and his partner build lots of new homes in either small developments or an infill situations and lots from scratch. And George is involved with acquisition and finance specifically. So he’s out there beating the streets just like we are trying to find properties to acquire and negotiating those purchases often in the living rooms of those sellers, but with a different idea in mind about exactly what’s going to happen with the land that he buys. So it’s really fascinating to get to hear his perspective on what he’s looking for, what some of the red flags are that he’s making sure aren’t happening, what some of the techniques he uses are to be able to put great deals in contract that will be conducive with the realities of what a schedule is like for building out a huge project with multiple lots and all sorts of cool stuff. So instead of me summarizing this awesome interview, let’s just get right to it. I hope you enjoy this as much as I did.
Jeff Stephens
George, thanks so much for hanging out with me today.
George Hale
Jeff, I’m excited to be here.
Jeff Stephens
Well, I’m excited to have you; I’ve been looking forward to doing this. I think you are going to be able to bring like a different perspective, and different sets of topics than what we often think about and discuss on this show. So I’m really fired up for that. So why don’t we start there. Talk to us about what do you do right now? And then let’s also just talk a little bit about what are some of the things in real estate you’ve done over the years that sort of landed you where you are now.
George Hale
Sure. I have a company called Woodhill Homes and we build houses, subdivision houses, primarily, in Oregon. We do about 150 houses per year. And we specialize in subdivisions that are let’s say 20 lots to 100 lots price ranges, we are in our first time homebuyer and then first time move up buyer. So that’s primarily what we do now. My history is I’ve been in been interested in real estate since I was in high school; I’m 51 now, so kind of been in it for a long time. I graduated college and I started selling real estate. And I always knew that I wanted to be a builder and or a land developer. And so I started flipping houses when I was in college. And then once I was selling real estate, and then that that kind of molded me into building houses. And so other things I’ve done I’ve owned rentals. During the downturn, I bought 30 foreclosures around the country for on average of $5,000 to $10,000 each. And then we turned around and sold them on contract to buyers. I’ve also built apartments.
Jeff Stephens
So, yeah, so you’ve done a lot of different things. And would you say that what you’re doing now is kind of the informed result of sampling a lot of different things and saying, Oh, this is really where I like to be the most, or is this kind of a current phase? Do you see yourself doing different things in the future?
George Hale
It’s a good question. I think that ever since day one of getting into real estate, my passion was really land development. And kind of what I like about land development is how you go about and find the deal, how you put the deal together, you know, so all those components, it really is kind of a process and it’s a relationship. And I’ve been doing subdivision development for probably the last 20 years. And so this is just kind of an extension of what I’ve been doing for 20 years; in the future, I think we’re going to continue on doing the same thing. Housing doesn’t, you know, the forecast or that, you know, we need more housing. So, yeah, it’s kind of a culmination of, I think everything I’m good at. And I’ve just got a really great team around me now that builds the houses.
Jeff Stephens
So you’ve got a partner in this business, right? So how do the two of you kind of divide up your roles? Like, what areas do you handle the best?
George Hale
Yeah, so I primarily handle the land acquisition and land development, and finance. My partner, he is just a wizard at building houses, scheduling, purchasing, managing the people. And so that’s the side of the business that he takes over. So I’m more kind of big picture, thinking about the future. He’s more detailed, thinking about right now. I mean, he’s just a wizard. He’s the greatest ever. And so I’m super grateful that we’re partners, because I think that our strengths really blend well together.
Jeff Stephens
Would you describe it as a classic type, like from the book Traction, Visionary-Integrator type of relationship?
George Hale
Oh, yeah, exactly. Exactly.
Jeff Stephens
Okay, so let’s talk about acquisition. I picture you sitting in people’s living rooms, and trying to work out deals, right. I think that’s a big part of kind of where you and I have a lot of alignment is kind of geeking out on that idea of trying to find the thing that’s going to work for everybody and getting a yes, and whatnot. So if somebody, it’s kind of an open ended question, but if somebody said, George, what is your acquisition strategy, how would you describe that?
George Hale
Yeah, that’s a good question. I think it’s like you say, you’re solving for awesome. My acquisition strategy is that there’s always a piece of the deal that really works well. So I mean, if you just get the basics down, first of all, you know, it has to be in our strike zone, has to be in the market that we can build in, it has to be in the size range that we need; we don’t build on sloped land, it has to be flat. Once it meets those criteria, my strategy is that it has to have something great going for it could be great. Could be the price. Because an okay property is awesome at a super price. It could be the financing deal. Because a lot of times I can pay more money if I get really attractive financing. Or, you know, it could be location and location. I mean, does it have something that nobody else has, if I’m competing with other builders. And so, when I look at deals I look for these attributes that will give me an advantage.
Jeff Stephens
So, when I think about development, which I have rarely done myself, but when I think about development and the process of buying a piece of dirt, paying for it, and then really not being able to do anything with it for a long time while permits are taking place, and all that kind of stuff that really suggests a need for creative deal structure, right? And I wonder sometimes if I were you, if I were a buyer of land in a business like yours, sometimes the seller I have to assume knows that they’re selling developable land. And they’re thinking already in those terms, and they’re saying, Well, you know, I’m selling this plot as development to George. So I need to have some empathy and expect that, you know, he’s not going to want to just be have this thing be fully financed to be able to do nothing with it for several months.
But then maybe there are other sellers who don’t understand as much about your process and sort of what it’s like to build something and be sitting on debt service for a year before you can do anything. So anyway, this kind of a meandering question to ask you about creative deal structure. I have to imagine creative deal structures is a big part of what you end up negotiating. Is that true?
George Hale
Yeah, within the realm of what’s acceptable to a developer. So typically, what’s acceptable to a developer is, we only close on the land once we have the approvals in place to do what we think we can do with it to build houses on. I mean, I think it probably goes more towards speculation, when you buy land, not having those approvals. Because so many times, you know, you will go in for an application and the city comes back, and they say, well, we need a pump station. And those can range anywhere from $500,000 to $1 million dollars, right, which kind of throws your numbers all out of whack.
So I’m within the realm of knowing what we need to do with the property and getting assurances on that. That’s where the creativity kind of starts. Sometimes we would have, let’s say, an owner subordinate some land, we might do what they call a takedown schedule, where we don’t buy the entire property all at once, we’ll kind of chunk it out. But a lot of it’s driven by what’s important to the seller. I mean, so many times the seller is just stuck on their number, and they’ll give you the moon, they’ll give you they’ll concede on every other deal, as long as they get their number. And so part of the creativity is really kind of that probing to figure out what is the most important thing to them. And what I think about is if I can find out what the most important thing is, give it to them, I can get everything else that I need. And if I can make the deal work within that, it’s like everybody’s happy.
Jeff Stephens
I call that the One Big Thing. That that one thing that if you don’t scratch that itch, there’s no deal that’s going to happen. But I also I love the idea of thinking about what when you know, the seller is one big thing. If you watch a magician, a magician gets you focused on one thing, right? They’ve got you focused on what they’re doing with their hand and meanwhile with their other hand somewhere else, that they’re actually doing the trick, but they’ve got your attention directed on the first hand, and I feel like with sellers, a lot of times, it’s kind of the same thing, if you can understand where their attention is. Great. Let’s take that and run with it. Keep their attention right there, and then negotiate the other things you need to make it work for you. While keeping their attention on that thing that matters most to them. Do you see it like that too?
George Hale
Oh, yeah. That’s a great example. I mean, that’s almost exactly how it is. And so many times, you know, the thing that’s so big to them is important to me. But these other things are way more important, you know, just so much more instrumental in making a deal work that if you can really find that that one thing, it can be a game changer.
Jeff Stephens
Just before we got on here, I recorded a brief episode, which I think will air before this interview, about the idea of is a transaction mutually beneficial. And, you know, without like being too redundant to the actual episode, somebody said that to me the other day, they said, Well, you know, obviously we wouldn’t propose something that wasn’t mutually beneficial. And I was like cash, something rings funny to me about that. And as I stepped back, I realized was yes, that’s true. We wouldn’t propose something that is mutually beneficial. But we also wouldn’t be talking at all about what we consider to be beneficial to us. I mean, That’s my, that’s my approach. So we would be focusing on giving the seller exactly what they want. And sort of silently behind the scenes, we’d be thinking about what do we need to make this work. And it would end up being mutually beneficial. But that doesn’t mean that’s how we have the conversation. The conversation is about like, Well, here’s what George wants. And here’s what seller wants, let’s come to a meeting of the minds. It’s kind of more about trying to navigate that and get what you want, without even really making that part of the conversation.
George Hale
Yeah, I mean, kind of exactly. And, you know, there’s one guy who I really respect told me that, you know, in every deal somebody in every deal, and in some part of the deal, somebody’s lying, right. And that’s kind of a difficult, I mean, that’s kind of a harsh way to put it, but everybody’s kind of hiding what they kind of don’t want somebody to know, hey, I have bills due, and I have to get this deal done. Or, I have this other property that I really want to buy. And, and it has to happen here. Or, you know, I gotta have this price, because my neighbor just got that price. And I hate my neighbor, and I got to get more than him to make my ego feel good. And so they don’t always come out and tell you what that thing is. So, you know, you kind of have to probe to try and ascertain what would make that deal mutually beneficial.
Jeff Stephens
I love that I’ve never heard. I’ve never heard that before that in every deal, somebody’s lying. It makes me think of something that I heard a while back that I also thought was really interesting and profound, which is that to get a deal done, there, there has to be a disagreement on value. Like, you have to look at that land and say, I’ll pay a million bucks for that, because to me, it’s actually worth 2 million. But to them, the seller, they have to say the million dollars is worth more to me than the land. So you actually have to feel like it’s worth more than you’re paying. And they have to feel like getting the money is worth more than what they have. So you actually have to fundamentally disagree on the value in order to come to an agreement. Isn’t that fascinating?
George Hale
Yeah. interesting way to look at it.
Jeff Stephens
So you might use a takedown schedule or some subordination, I imagine, like, there’s an option come into play sometimes, like, you sort of control the property for the first you know, 14 months or whatever, till you’ve got your ability to break ground?
George Hale
Yes, I mean, options are just a really excellent way of controlling land, because in the end, it’s about controlling the land, it’s not about owning the land, it’s about the control. And if you can control the most amount of land with the least amount of money, that’s really the ultimate. Options are difficult in our market, just because we’re kind of land constrained. So the development land that is there is highly sought after, and most owners get hit up all the time to sell. And then, when the market is really good, I mean, it’s almost non existent to be able to optionally.
Jeff Stephens
So shifting gears just a little bit here. You know, when you first texted me and told me, you were listening to this podcast, I was like, wow, why? Why are these people who are already so sophisticated, so far down the road, further than me, been doing it longer than me, why are they listening to my podcast? So then every time you text me, I just sort of smile and chuckle and be like, wow, that’s amazing. But it really says something about you and your, I guess, approach to the idea of just ongoing learning. So you and I’ve had conversations not just about this podcast, but other stuff you’re listening to or reading. So why does someone who’s such a seasoned veteran keep focusing on learning and having an open mind and feeling like you can learn from other people, even who haven’t been doing it as long?
George Hale
Yeah, well, I just have a fundamental belief that I can continue to learn. And, you know, it’s the old saying, The older you get, the more you realize the little amount that you know. I gotta say that in real estate, I mean, that’s the case. You know, I read a lot of books. But what I’ve really noticed, and I’ve been in business for a long time, right? I’ve ridden it up, I’ve ridden it way, way down. And now the market’s good again. But one interesting thing I’ve noticed is that during the downturn, new people came into the market. And, I really had to check myself because the attitudes and the thoughts and the beliefs that I had about the market going forward, these new people didn’t have. They looked at the market completely in a totally different way and they were operating that way. And it just kind of made me remember that way I can always learn something from everybody, even the new guy, you know? It’s just really important.
Jeff Stephens
Yeah, yeah. I love that attitude. I’d like to think that I share that attitude, for the most part, but I don’t know that it’s super common necessarily. I think real estate is also really filled with people who feel like having knowledge is in itself kind of the end goal. But ultimately, you have to be applying what you are learning as well. So maybe that’s neither here nor there. But it makes me think about you and I actually know each other not through real estate at all. We know each other through EO: Entrepreneurs Organization, originally. And we’ve both done things like Strategic Coach and neither of those things has anything specifically to do with real estate. And I think about all the money that either of us have spent on those types of things that have nothing to do with real estate specifically, and I think that that’s an important point. I’d love to hear you speak a little bit to what is the value of having a broader perspective on entrepreneurship beyond just one’s industry?
George Hale
Hmm, interesting. Well, let me back up and just say that, I think that learning and broadening one’s thoughts, and way they approach things, in my opinion, it just can’t do anything but help the way you approach your job and look at deals. You know, you talk about creative deals, a lot of times, and I think that creative deals necessitate, you look at things from a different angle. And if I’m not consistently challenging and thinking about different ways to look at things, I might miss something, and I have. When I miss a deal because I didn’t look at it in a certain way and somebody else gets it, it hurts, but that’s kind of a reset for me to think, Okay, what went wrong? How can I change? How can I do that better?
But the other thing about those groups that you mentioned and kind of that ongoing learning is I think when you have an attitude like ours, learning is when you go to these events and meet these people, you meet other like people, which really kind of helps me, like you’ve done, crystallize my thoughts. You know, you’ve you’ve put to words kind of what’s rolling around in my head so many times, and it just really kind of expands my ability to do my job, inspire people and really create a good product.
Jeff Stephens
It’s really interesting; I think a lot about, you’ve probably heard me talk about this, the difference between being an investor versus being an entrepreneur. What I mean, when you think about yourself, I guess literally you could say, well, I’m a home builder, we are home builders, but what’s your self image? Do you see yourself as an entrepreneur whose business happens to be in this industry? Do you see yourself as an investor whose strategy happens to be building and retailing properties? How do you see yourself?
George Hale
Yeah, first and foremost, I see myself as an entrepreneur who happens to do his craft in real estate, building and selling houses. Secondly, I would be an investor. Because I’m in the business and I can build houses and keep them as rentals, we do that as well. But first and foremost, absolutely I’m an entrepreneur. That’s just the way my mind thinks; I’m always thinking about how to do it better, how to do it different, how to do it bigger, how to do it more. I mean, that’s just really exciting, that makes me get out of bed and just kind of lights that fire in me that just wants to go get them. I also believe, on the other side, the investing side, I think the way to build long term wealth is through real estate. And it’s not a get rich quick thing. You know, it’s a slow and methodical way to have and attain wealth.
Jeff Stephens
One thing you didn’t mention before is in your family, you and your wife have another business, completely different type of business. And I have to think that somehow when you’re thinking about the other business, you bring what you’ve learned through real estate to that. And when you’re looking at at your real estate business, you bring what you’ve learned through the other business into this. And in my mind, I have to just imagine that that makes you more well rounded; you think at a higher level, right? Because you’re not just necessarily in the weeds of real estate or food service or stuff like that; you can kind of rise above a little bit and see some of the principles that apply to both. I mean, do you feel that way?
George Hale
Yeah, absolutely. A lot of the lessons that I’ve learned and the way that we have to operate in real estate, I’ve taken to the other business. And I think that I’ve really been able to kind of inject quite a bit of, not really life, but you know, just that extra added piece that they don’t really have, because of my experience. And conversely too, taking from that other business into homebuilding, a lot of the same issues kind of apply just across the spectrum of business. But the way they kind of get things done is different. And if you can notice, there are little tips and tricks and apply it to other business, I mean, it really kind of helps and kind of puts you farther down the road than if you were just going and testing and measuring and trying for that thing that works on your own.
Jeff Stephens
Yeah. When you and I saw each other the other day, I asked you, gosh, how was this COVID experience like in your other business? And one of the things that I was really struck by is that you said, Well, you know, it’s been okay. But the fact that I went through some adversity in the 2008 downturn in the context of real estate, actually helped me have more perspective, not just in terms of real estate now, but actually perspective on how to weather the storm from the other business too. I love the kind of cross pollination of those of those things; you learned it in sandbox A, but now you’re applying it in sandbox B. I just think that’s really, really cool.
George Hale
I mean, that’s the benefit of experience, it’s that now you have it. It’s interesting getting experience in real estate, because people can talk to you about what it’s like when the market goes down, or what happens when this changes, what happens when that changes, but you really never learn those lessons until you go through it. What I tell people is that I got a really, really expensive MBA and I learned things that I would never ever learn elsewise, and that’s invaluable.
Jeff Stephens
You know, this interview that I published not too long ago with my own coach, Greg, we talked a lot about the value of adversity. And one thing, I don’t think we talked about this expressly, but as I was later re-listening to the interview myself, I thought about there’s kind of a difference between having a mentality of there’s a silver lining and then thinking adversity is beneficial. Because a silver lining is sort of like a retrospective, nice way of putting a positive spin on some crap you went through. But the value of adversity perspective is actually saying like, we haven’t even faced this adversity yet, but I know, the good part of this is that whatever we face, we’re going to learn a lot from it and it’s gonna make us tougher and more resilient in the future.
George Hale
Yeah, absolutely. I mean, we’ve really changed a lot of our business practices, because of the experiences that we’ve had. You know, we look at risk different; we try and hedge risk differently now. And so yeah, I mean, it’s experience is experience. I guess what you do with that is really where the gold is, you know?
Jeff Stephens
Yeah, yeah, absolutely. So to pivot again, I want to go back; there’s two words that came up in our conversation the other day, this is more back to like building and selling homes. Sex sells. Tell us what you meant when you said that to me the other day.
George Hale
Yeah, sex sells. Well, what that means to me is that, like you said, people act on emotion. People buy on emotion. And it’s my belief that people want to drive up to a house and they want to look at it, and they want to feel good. They just want to be proud. And so when we approach building things, selling things, making it look good, you know, putting quartz counters in, putting hardwoods in. This is what I tell my team, I always remind them, hey, sex sells. So what that means is that the nicer it looks, the better it looks, the more it’s going to sell and the easier it’s going to sell. And so that’s kind of what that means, sex sells. I go off on it with my team if I have to but really, you know, look at cars; the nice cars everybody wants because they look good, a Porsche, Ferraris, they look awesome. So that’s kind of my approach to it.
Jeff Stephens
I think a lot about the idea of self image. When it comes to things like this, I think there are people who would walk up to one of your homes and say, Oh, I’m the kind of person who lives in a house like this. And you guys build distinct homes, I think, generally, at least what I’ve seen, more of kind of a modern style. And I think there are people who say, Oh, yeah, I’m the modern style kind of person. And for them, that’s kind of the sex that’s selling to them, because it’s speaking to how they either see themselves or want to see themselves could be a little bit aspirational in that sense. So I think you’re when you’re doing that, you’re tapping into how people want to see themselves and I’m not sure there’s anything much more powerful than a person’s self image or their desire for self image.
George Hale
Yeah, you’re so right. And even if you drive it back down to let’s say the first time homebuyer; there, it’s almost like they’re just trying to buy a house. But what we try and do is give them that thing that makes them feel like they made it. And some of it, it’s like a fireplace and in first time homebuyer houses, a lot of builders leave it out; solid countertops; it used to be stainless steel appliances. That was their aspirational goal. And if you could do that, I mean, they see that, and they just like, it was that feeling. But I think you’re absolutely right there.
Jeff Stephens
And, you know, you mentioned before the importance of location, kind of overall as maybe one of the awesome things you could be solving for. But if you’ve got a great location, in some ways that can be the sexy element that sells. I mean, someone’s visualizing themselves, like, Oh, I’m walking to the bakery every morning to get my cup of coffee. Actually, this this goes way back to, I mean, many, many years ago, you and I spent a day together, right when I was trying to transition out of my previous business and into real estate. And you drove me around, we were kind of talking about stuff, and you were saying a few years ago, it used to be that everybody wants to be walkable to Starbucks, but now they want to be walkable to New Seasons. And for everybody listening who’s not in Portland, New Seasons is just a lovely, higher-end type of grocery store, small format. But that location becomes in some ways the sex that sells, don’t you think?
George Hale
Oh, absolutely. Location and walkability, it’s such a big, big deal now; that is the sexy part. And you’re absolutely right; I mean, the more things you can walk to, walk to dinner, walk to a bar, walk to a coffee shop, walk to a grocery store, it’s a big deal. And I think it’s become a bigger deal through COVID, because so many people were just kind of stuck; you couldn’t really do a lot and so people just walked and part of what I saw in my neighborhood is people’s walking routines were to the store, to the places that were open, which was primarily the grocery store. But yeah, it’s a big deal.
Jeff Stephens
Yeah, I think that applies just as much in rental properties as well as retail sales. You know, one of the things I try to make clear to people is that it’s easy in rental properties to have a mentality of like, oh, if the numbers work, that’s all that matters to me. But there is such a massive difference between a utilitarian piece of real estate, that’s really mostly just shelter in a nondescript type of location, and then something that’s from a utility perspective equivalent, but has so much more emotional appeal, based on location or based on architectural style, or things like that. And I wish more people would kind of appreciate that; the value from the investor’s perspective of owning quality, romantic, sexy types of product actually really translates into like meaningful, tangible, metric type results. That’s at least my perspective on it.
George Hale
No, I agree. I mean, with our rentals, I think we can get about 20% to 25% more if it is a sexy location, if it’s in a location that you can walk to coffee, you can walk to the grocery store, everything is right there. People talk about living in a bubble, and if you can reduce your bubble to where you can live to where everything’s walkable, I think that that’s an enormous intangible. It’s really tangible, but it’s not translated on paper that well. And what we’ve found is that people pay more for that.
Jeff Stephens
How do you decide which product that you build you will keep versus sell, and do you know, in advance of closing on the land in the first place, what your play is going to be?
George Hale
Well, that’s difficult. We don’t know in advance of closing on land. A lot of times, it’s driven by numbers, and where that that rent is compared to the cost of the house to build. As you know, rents don’t go up and down like house prices, do. You can buy a house from $350,000 up to $2 million. But if you were to buy in each of those price ranges, and you rented them out, it’s just not a comparative return. So we primarily look at what the rent is that we can get, and what the cost is in the house. And when those numbers are the best, we probably have the least amount into the lots, and those are the houses that we keep. Additionally, we’ve kept some that are just fabulous locations. Fabulous. I think about it in terms of Michael Jordan. I mean, some of these locations are Michael Jordan. And, you know, if I was going to start a basketball team, I’d start it with Michael Jordan, it’s not going to go down in value, and it’s always going to be the greatest location.
Jeff Stephens
That’s awesome. I love that. So I want to wrap it up with one final question about something you brought up before, when you said when you’re looking for land, you’re looking for certain criteria. I guess I was just struck by that thinking, you can almost put this under the category, that headline of like decision fatigue. If you have to evaluate every opportunity from scratch, every time that’s laborious and exhausting, and you won’t have uniformity. But you started, you said, Look, I don’t build on sloped lots; okay, great. I don’t do this type of thing. I don’t do that type of thing. And that makes it easier for you to make decisions.
I think about my version of that would be basically, I don’t buy properties where I’m gonna have to get a bank loan, unless it’s really, really, really special. I don’t buy properties that are in the middle of nowhere; I do have these sort of set criteria that makes the decision making easier. It’s like a framework is what I’m trying to say. So did you set out with all those upfront? Did you kind of learn some of those things throughout, and cultivate and refine that list of criteria?
George Hale
You know, when I started, I pretty much walked into it with the criteria that I had to get a good deal, because I didn’t have enough confidence in my ability to execute, and I didn’t want to lose money. And so that set me up to only look at a certain number of deals. And so I just approached everything from there. From there, I’ve kind of expanded the way I look at deals and just kind of through better experience, I understood that, hey, there’s just more to it than just getting a great deal. There’s more to it that can insulate my downside. And so that’s, that’s primarily where I’ve come up with the, you know, the three attributes of what I will look for.
Jeff Stephens
That’s great. It just reminds me of that topic of decision fatigue, where they talk about the tech CEO, billionaires who always are wearing the same thing, because they just don’t want to have to make that decision every day. They’re like, Oh, I love that T shirt, so I have 28 of them and they just wear the same thing all the time. But that it’s just one less thing that they have to worry about deciding about and in that way, I think that applies really, really well to what you and I are doing, too.
George Hale
Yeah, no, I think you’re absolutely right. Because if you look at what you can buy in real estate, I mean you can just go crazy. Everything. Everything’s for sale. But to narrow it down, I think you get better at it. And like you said, it just kind of cuts down on that decision fatigue.
Jeff Stephens
So now that I’m saying that, I’m also I’m hearing the devil’s advocate voice in my own head saying, okay, Jeff, but you also tell people not to prejudge opportunities too quickly and to walk around the opportunity and see if there’s some other angle here that could make this deal works. I’m suddenly trying to reconcile how do I feel about these two things: having clear criteria, but also remaining a certain level of open mindedness? Because, I think also probably you and I would agree, that we don’t want to just be cookie cutter and only see things kind of one dimensionally. I might be rambling, but does that strike a chord with you at all?
George Hale
Yeah, I mean, you just kind of hit the entrepreneur chord with me. And, it makes me remember that my partner and I, probably two or three years ago, bought some lots that Deschutes County auctioned off, kind of out past Sunriver. Was it Sunriver? Yeah, out past that, I don’t know if you’ve been out there. They’re these big lots, but some of them have problems with the water table being too high, so you can’t build anything on there. But they were just such great buys that we went out there and bought them, and we actually turned them around and turned them into money. So when I think about that, I mean, there always has to be a compelling reason for me to get in there. Because if it’s commercial, there’s a lot of guys in that business who are really, really good. So there has to be something compelling for me to want to look at a deal. Typically, it’s price, or it’s just really great terms, or it’s really great location; it comes back to my land criteria again.
Jeff Stephens
So maybe it’s like this; I feel like I need to put a bow on this for my own sanity, and hopefully, that of our listeners. So maybe these criteria are just the boundaries. Like if we’re building a sandbox, these are the edges of the sandbox, and we’re saying we don’t go outside the sandbox. However, within the sandbox, we are happy to explore every square inch of what’s possible within that sandbox, but there are edges and boundaries that we don’t cross. Does that work for you?
George Hale
Yeah, I think that’s a good way to put it. No, absolutely, that’s the way it works.
Jeff Stephens
Awesome; man, this is fun. I have a strong feeling we could pretty much chat all day. So if there are people who want to find out more about you and and what you do and see what a Woodhill home looks like, what’s the best way for them to follow up and check you out?
George Hale
I think just go to our website, www.woodhillhomes.net. That’ll give them all the information and a way to get in contact with me, and check out our stuff.
Jeff Stephens
Well, this has been super fun. I’ve got a whole bunch of notes and I really appreciate you taking the time to chat with us, George.
George Hale
You bet, Jeff. I’ve got an incredible admiration for you, so I really appreciate you having me on here; it was a lot of fun.
Jeff Stephens
Thank you so much.
That’s it for today’s episode of Racking Up Rentals. I hope you enjoyed that awesome interview with George and got some great gold nuggets out of it, just like I did. Again, show notes for today’s episode can be found at thoughtfulre.com/e103. Please do us a big favor by hitting that subscribe button in the podcast app and take a second to rate and review the show; I so appreciate that, I see them all personally.
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Thanks for listening to Racking Up Rentals where we build long term wealth by being win-win dealmakers. Remember: solve the person to unlock the deal and solve the financing to unlock the profits.
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