Best Ever Listeners, today we have the privilege of learning from a celebrity! Justin is the star of Zombie House Flipper on A&E. He worked his way up to flipping over 100 homes and being the star of a TV show. His take on life is refreshing and something we could all use a little more of in our own lives. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!
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Justin Stamper Real Estate Background:
- Began his career in real estate by flipping his family’s foreclosed home when he was 19 years old
- Worked his way up to becoming a well known real estate investor in Central Florida by buying and renovating over 100 homes
- Say hi to him at www.americananchorhomes.com
- Star of Zombie House Flipping on A&E
- Based in Orlando, Florida
- Best Ever Book: 48 Laws Of Power
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TRANSCRIPTION
Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff.
With us today, Justin Stamper. How are you doing, Justin?
Justin Stamper: Hey, I’m great, man. Coming to you live from sunny Orlando, Florida. What’s up, Best Ever listeners?
Joe Fairless: Nice! Well, what’s up back, my friend. One of our team members, Theo, moved to Florida from Cincinnati, and I was talking to him recently and he’s like “I don’t know why I ever lived in Cincinnati. The weather here in Florida is amazing.” Not knocking Cincinnati… Well, he kind of was knocking Cincinnati. I’m not knocking Cincinnati, I’m just repeating what he said.
Justin Stamper: Just knocking winter.
Joe Fairless: Exactly, just knocking winter. Thank you for that. Good save, I appreciate your help on that. Justin began his career in real estate by flipping his family’s foreclosed home when he was 19 years old; worked his way up to becoming a well-known real estate investor in Central Florida by buying and renovating over 100 homes, and you can learn more about what they’re up to now at AmericanAnchorHomes.com, which is also in the show notes.
With that being said, Justin, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?
Justin Stamper: Yeah, absolutely. Best Ever listeners, I got into real estate just by getting chucked into the lion’s den. I had just graduated high school, I really wanted to work in the music industry, and moved to London. My parents called me and they were like, “Hey, it’s the recession…” — it’s like 2008 when this was happening… “You know, if you could move home and kind of just help us out… We’re just going through some really tough times.”
My family owned a small business, and unfortunately they lost everything. We went bankrupt, and we also ended up losing our home. So I was home one day, these guys came and knocked on the door, and they were like “Hey, we need to talk to your parents.” I was like, “Hey, look, they’re not here right now. What’s going on?” They’re like “Well, we just bought your house today at the foreclosure auction.” I was like, “Wow. I didn’t even know my house was in foreclosure.” They’re like, “Yeah, we didn’t know people lived here.” I was like, “Yeah man, this is like my childhood home.”
They were super cool. I actually renovate houses with these guys now, like ten years later… But they gave my pops and I the chance to buy the house back for like essentially a markup. We raised private capital through friends, bought our house back from these guys, renovated it ourselves, and sold it. We made the first bit of money that we had made in real estate, and at that time any money that we had made in a couple years, and I literally started buying houses at the same courthouse auction a month later, and just kind of never looked back. Pretty crazy stuff.
Joe Fairless: That is pretty crazy stuff, and thank goodness for the individuals who purchased the house being good people, who wanted to make money but also wanted to work with you all on a solution to help you all out.
Justin Stamper: For sure. Because honestly, that’s probably my favorite part about real estate… The service that we do (hopefully) is solving problems and bringing solutions to people, and fighting the good fight and helping people out. They were all about that, and they kind of showed me the ropes of that through my career; real estate doesn’t have to be about profit and loss, it can be about “Hey, these people are in a really peculiar situation, they’re going through a tough time. Can you help them?”
Every time I buy a house from somebody that’s like pre-foreclosure or dealing with a death in the family and doesn’t even wanna walk into the house again, I enjoy being able to be like, “Hey, let me help you pick up the pieces of life.” Because life is tough man, there’s no easy way about it; there’s no instruction manual for this life, there’s a lot of challenges, and real estate, for a lot of people, is super stressful, especially if it’s not their profession… So I love being able to help people out, and these guys kind of showed me the way with that. And it’s cool, and it’s led us down a crazy path, and now we have a television show about us flipping houses in Orlando, on AME, called Zombie House Flipping. We’re doing our third season, and I never would have thought that some punk/rock kid who only has a high school education would ever have a show about being a real estate professional. I’m still kind of in shock and awe that my life has worked out this way.
I think a lot of it has just had to do with helping people out. I don’t know… That’s my take, to all the Best Ever listeners out there – I guess if you help enough people out, eventually the world will give you what you actually wanted. It’s been pretty cool.
Joe Fairless: Yeah, a Zig Ziglar quote – or at least attributed to him – “Help enough people get what they want, and you’ll eventually get everything you want.” It’s something I certainly live by. Real quick on that – your family house, that got foreclosed on, and then the individuals who purchased it at the auction made a deal with a deal with you all and sold it at a markup… First off, how much did they buy it for, if you know, and how much did they sell it to your for?
Justin Stamper: Yeah, they bought it for 400k, they sold it to us for 450k. We renovated it and we ended up selling it for 750k. So we actually made a killer deal. We actually made around 200k on our very first transaction… Which is super rare. We’re going back to like 2008, where the banks and the valuations and everything was just a huge mess.
Back then, there were some deals where they’re like “Well, this bank owns it, but this bank is now bankrupt and absorbed by this bank…” You know, it was a mess back then. So they sold our house totally under value, and these guys, they only owned it for a week and they made 50k, so they were happy, and then my pops and I put like 30k-50k grand into it, and then after we paid closing costs and commissions, we ended up walking with just around 200k.
We gave our private investors 100k, we split it 50/50, and we kept the other 100k, and we started buying what we could afford with the 100k, and just never looked back.
Joe Fairless: Let’s pretend for a moment that the individuals who purchased your house at the time were cold, calculating and just mean people. What could they potentially have made if they did whatever they needed to do to maximize the profit? So they bought it for 400k… What could they have made and what would they have done to do the mean path process?
Justin Stamper: They could have kicked us out, which would have sucked, because I have no idea where we would have went, because we were broke as a joke… And they could have probably put 50k into it, like we did, and probably sold it for 750k, like we did as well… So they could have made a killing, I guess. After closing costs and commissions, they would have walked with probably like 275k, depending on — if they weren’t pulling hard money, they probably could have made like damn near 300k, which was a killer.
Nowadays, those deals seem few and far between. The market is just so on fire in Orlando now, and everybody wants to flip a house… Because you know, all these guys on television out here making it look so easy… [laughs] But yeah man, they could have made a killing, but luckily, they were totally fine with just like a quick wholesale fee of 50k, which — I mean, I’ve wholesaled hundreds of houses, and hardly any of them have ever been a 50k fee. I think in that situation it was a win/win situation for everybody, so that was cool.
Joe Fairless: And you said you have since partnered with them, and it sounds like you still do… First off, is that accurate?
Justin Stamper: Yeah, they’re a part of the OG House Flippers in Orlando, and I worked my way up because I didn’t have the most capital when I started… I started really just wholesaling a ton of houses. I was going to the auction, picking them up at the auction and then just wholesaling them to people that were not at the auction… So I just got to know all the real players in Orlando, and these guys are real players. Every now and then, they’ll bring me a deal that’s like either “Hey, we don’t want it… Do you want this?” or “We’re down to put a path if you’re down to put a path…” I think at this point we all trust each other and we’ve done enough business that 10 years later they’re still friends of mine in the industry.
When you get involved in your local real estate community and you do a couple transactions with people, it seems one way or another it will always come back around to you. These guys have always kind of brought it back around, and vice-versa to them.
Joe Fairless: If you had to put a number on the profits that they’ve made from the deals you two have partnered on, so profits just they’ve made from the deals you two have partnered on over the years, what would that number be?
Justin Stamper: Well, honestly, I would say just in the deals I’ve wholesaled on – because I know I’ve wholesaled on at least 10 houses that they’ve made close to 100k revenue from… I would say that I’ve in turn repaid the favor at least over half a million bucks in profit for them by just being like “Hey guys, before I even send this out to my list, I know this is your strike zone… Here’s a house, let me know. It’s off-market. If you want it, just let me know in 48 hours.” And in turn, they’ve bought a good amount of houses from me wholesaling that I feel like I’ve repaid my dues of like “Hey, thank you so much for helping me get my start and letting my family keep a roof over their head.”
Joe Fairless: That’s where I was going with it… That’s why I was wanting to learn about the numbers, because everyone listening is an inherently nice person, but if there is an outlier and someone who was skeptical, like “Oh man, yeah, they let you stay there, but they only made 50k when they could have made 275k or 300k”, I wanted to bring that full-circle. So there was basically 250k of potential profit that they left on the table for being good people, but then the world, through you and other deals you worked with them on, repaid them the 250k and potential lost profit, and then doubled that at minimum to another 250k, plus you can sleep well at night and you’ve got good karma, right?
Justin Stamper: For sure. Absolutely. It hopefully always comes back around. I’m a firm believer that if you’re doing good business and you’re helping people out, it’ll come full circle… And it’s taken me age to learn that. I’m 29 years old and I was impatient; as a hustler, you’re always like “When’s the next deal? When’s the next deal? When can I get this? When can I get this?”, but my mentors are all 15 to 30 years older than I am, and they’ve always just been like “Slow down. All in due time. Everything comes back around. Even if it’s 15 years from now, you’re gonna be shocked at the full-circle of life.” When I was 23 I didn’t understand that, but now that I’m coming up on 30, I’m starting to see the actual full-circle of doing good business and just being involved in your community, and it’s really cool. It’s cool to see the karma of the Universe. I’m a big fan of that.
Joe Fairless: Agreed. As am I. So now what is your focus from a business standpoint?
Justin Stamper: So we’re filming season three of Zombie House Flipping. This year we are flipping 14 houses on the show. And then I’ve probably done four more renovations this year that aren’t on the show.
My partner Ashley and I, we own a boutique brokerage in Orlando, Florida where we just transact real estate, and we buy and sell our own real estate etc. But truth be told, good friends of mine sold their entire rental portfolios in Orlando and then traveled around the country for over a year to different markets, looking at turnkey and just good returns on single-family and multifamily real estate, and they settled on Cleveland.
They hit me up and they’re like “Hey man, we’ve just bought like 30 houses in Cleveland, we’re having killer returns. We sold everything in Orlando. We’re actually thinking about moving up here. Come check out what we’re doing.” And these are good friends of mine. These are actual friends. We hang out, we are good, close friends…
So I flew up to Cleveland to check out their operation, and literally like two weeks later I started selling off most of my rentals in Orlando, because the value here is so inflated… Or maybe not inflated, but our market is hot. So all my rental properties are worth double what I paid for them, and sometimes you’ve just gotta take your chips off the table, because you never know when the market’s gonna turn on you.
I’ve already watched it happen once, and I don’t wanna get caught on the wrong side of that the second time. So I started selling off my doors, and we started buying in Cleveland about a year ago, and we accumulated a portfolio between all of us of 52 houses at the moment. And then, since we all are well-versed in construction, we just started selling them off to other investor friends. It started with friends of ours in Miami that were like “Hey, we’re priced out of the market. We see you guys are killing it in Cleveland; hook us up with some houses”, so we sold them 15 houses, and then they brought their friends and they’re like “Hey, my friends want double-digit returns, too. Hook them up with some houses.” And next thing we knew, we were like “Um, I guess we’re kind of a turnkey company now…”, so we launched a turnkey company in February called American Anchor Homes, and we have our own construction crew in Cleveland, and that has honestly been my main focus.
The revenue that I’m making flipping houses in Orlando is just going towards buying more houses in Cleveland, because it’s so competitive in Orlando… And this is my hometown, I love my city, but I think maybe we have another 14 months of this market being on the up and up and on fire like it is… So I wanna be prepared when that market turns, and to me that’s always gonna be passive income, and Cleveland has just been really killer to work in, and I really like the city. It’s just like a cool punk/rock, weird Midwestern city that’s like having its own DIY local revival, and I love that. I just love weird punk/rock stuff like that.
So it’s been a lot of fun being there, and now that we’re launching American Anchor, it’s also just been a lot of fun to be like “Hey, come check out what we’re doing! It’s super cool!” I like that, it’s been really cool. So that’s what I’m up to right now, really just taking my chips off the table in Orlando and just putting them on the table in Cleveland to see what happens.
Joe Fairless: Were you not making passive income on your properties in Orlando?
Justin Stamper: I was, but there gets to be a point where — here’s how I was looking at it… It’s like I’ve got $100,000 in equity in this duplex; how long is it gonna take me to collect $100,000 in rent? Where I can sell this duplex, take my equity, and then go buy for the same exact price a 6-unit apartment building in Cleveland that I’m collecting more rent in. It just made a lot more sense to just take the equity while it was there and trade that equity for much better cashflow… Because the ROIs in Cleveland are just so much better, and the entry into the market is so much cheaper.
We have fully-renovated good properties for $45,000. In Orlando, if you buy something for 45k, you’re ducking bullets. Not that Orlando has crazy war zones, but there are war zones and there is not really real estate for sale for 45k in Orlando anymore. So it just made a lot more sense from a cashflow perspective to get rid of the properties here, take the massive equity and then go buy properties that were 12% and above cap rate.
Joe Fairless: Yeah, it makes sense. Understood. How many did you sell in Orlando?
Justin Stamper: I had nine properties ranging from single-family homes to multifamily… So I had nine individual properties that was like a mix of duplexes or single-family, and then my friends had like 17, I think.
We were in this market called Deltona that we originally all bought for like 30k-45k, and when we unloaded them, it was all for like 100k and above. So there was just massive equity, and you just never know how long that equity is gonna be there, because once the market switches again, if it goes back to only being worth 35k, 45k, 55k, you sure did miss a huge opportunity there to take your chips off the table. So it just made sense to get rid of our portfolios here, and it was crazy, because a 9-unit portfolio here, which was really expensive to buy because it’s like every property we’re buying — like, I just bought a duplex last year, for example, for 365k in Orlando. That’s an expensive duplex.
Meanwhile, in Cleveland I can buy a 20-unit apartment complex for around the same price. Now, granted, it’s probably not gonna be turnkey, it’s gonna need a lot of rehab, but still, your dollar just goes a lot farther, and that’s what I really enjoyed about it. You can just buy so much more.
Joe Fairless: Why didn’t you do a 1031?
Justin Stamper: Honestly, I wish I did. I just wasn’t educated enough at the time to do it. I have a friend and a mentor who’s going to show me the way, but at the time I was just like “Yeah, cool, let’s sell it.” I own a brokerage, so I can sell it for essentially nothing, and then “Let’s get this money deployed.” And it wasn’t until afterwards that my friend was like “Exactly, why didn’t you just 1031 that?” and I was like “Arrgghh!” Because I don’t know, I’m just shooting from the hip, you know? I can’t say that I know everything about real estate. I can’t even say I scratched the surface. I just am shooting from the hip and learning every day. Learning every day.
Joe Fairless: With the turnkey properties that you all have – what is your role in that company?
Justin Stamper: I handle all of our marketing and sales, because I’m doing it from a distance… I’m in Orlando, but my friends are in Cleveland. So I’m doing a lot of like — starting to do YouTube videos, starting to just do like educational stuff… We’re on television, so I have a good amount of social media followers, and I really just enjoy talking to people… The gift of gab, I guess. I enjoy, legitimately, talking real estate. I think it’s fun.
When you see me at a bar, I’m in the corner, talking to any random realtor that I’ve met, and that’s my exciting conversation over a beer; it’s like “What are you doing on the real estate market?” You know, for guys like us, we’re kind of obsessed. Being obsessed makes the difference between successful real estate investors versus people who never really get off the ground… Being super-persistent and kind of eating, breathing and drinking real estate in. So I enjoy it, where the rest of my friends who I’m in American Anchor with are like “Hey, we don’t like to talk to strangers that much, so Justin, you go deal with that.” [laughs]
So that’s what I’m doing, man… I’m the guy that you get to talk to if you wanna buy some real estate from us. It’s been fun though, I like that; I love helping people grow their portfolios. I’ve done it so many times wholesaling… People come to me and they’re like — my buddy John, he’s buying two duplexes from us in Cleveland next month, once he refi’s his entire portfolio that I sold him in Orlando, and he literally had never owned real estate before. Now he quit his job with corporate and is financially free. He makes all of his money from just owning all of the rental properties that I’ve sold him. So it’s been really cool to help people grow a portfolio. I love that. I love to be like “Whoa, remember when you came to me and you had no houses and now you have 15? That’s so cool! You and I helped change each other’s course of our lives.” I love that, man… It’s like the butterfly effect of life, so I’m super looking forward to growing portfolios with people.
Joe Fairless: Based on your experience, what’s your best real estate investing advice ever?
Justin Stamper: Keep hustling. Keep hustling. America rewards the persistent. I really cannot stress that enough. I have a high school education, my family was too broke to send me to college, and honestly, I was probably too punk/rock to even go and listen… So if it weren’t for just like waking up every single day — I mean, I worked three jobs… I was a line cook at Disney, I valeted cars at a nightclub here called Pulse, and I went to the foreclosure auction from 8 AM until noon, and then after that I either went and valeted cars or I went to Disney, and I was just a line cook inside of a hot, hot, sweaty kitchen. That’s what I did to get by for like the first four years before I had enough money to like full-time transition into real estate.
A lot of people might have given up. I had a lot of friends tell me I was stupid, because my first year in real estate I think I actually only made 8k that year. I think my next full year in real estate I made like 16k, and then it just kept doubling. It literally just kept doubling.
I had so many friends that were like “Why don’t you get a job with a corporation? It would be so much safer. You’re being foolish. Why don’t you try to go to community college?” I was just like “No. This is gonna work out, one way or another”, and it did. And it took years. It took four full years before I was like “Okay, now we’re full-time in real estate, making good money.
But just keep hustling. America rewards the persistent. You can get rich off of YouTube nowadays. There are so many things that if you just keep doing it, eventually hopefully it will pay off, and real estate is one of those things.
What did Babe Ruth say? “I love every strike, because it means that I’m one swing away from a home run.” That’s how it goes, just keep hustling. Best Ever listeners, you’ve already made it this far; you’re listening to the podcast. Now just keep your head up and keep grinding.
Joe Fairless: We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?
Justin Stamper: Boom, boom, boom! Born ready.
Joe Fairless: Alright, let’s do it. First, a quick word from our Best Ever partners.
Break: [00:23:25].19] to [00:24:28].11]
Joe Fairless: Okay, best ever book you’ve read?
Justin Stamper: 48 Laws of Power.
Joe Fairless: Love it. Robert Greene.
Justin Stamper: This was the top one, Robert Greene. 48 Laws of Power just kind of showed me all the other struggles that — if you don’t see behind the curtains, or I guess read behind the curtains, you just think that they were just born great and wonderful, and that life was handed to them… And then you read the 48 Laws of Power and realize that everybody had their own insane struggle to deal with, and they took it and they ran with it. I love that book. A mentor gave it to me when I was 19 years old, and I would say it definitely changed the course of my life, by just realizing that everybody else that I idolized had to go through hell to get to heaven as well.
Joe Fairless: Absolutely. And another good one – have you read his other books, like 33 Strategies of War and other things in the series?
Justin Stamper: Yeah, the 50th Law, and things like that…
Joe Fairless: Oh, man… The way he writes is like no other. In your face, unapologetic about what he says, and it’s factual, because it’s based on history. It’s just a must-read. I love him as an author.
Justin Stamper: Yeah, they’re great, and I love the fact that you can just pick it up, open it to any law and read that law, and it’s not like you missed anything from the last chapter, and you can just set it down.
Honestly, it’s a book that I pick up… It stays on my coffee table. I’ll pick it up once a week and just flip it open, read it for half an hour and put it down. I’ve been doing that for 10 years now.
Joe Fairless: Best ever deal you’ve done?
Justin Stamper: Man, I would say the first one, honestly, because that’s what started it all, and that’s what kept a roof over my girl’s head, that’s what gave me and my dad a new breath of life… Because we were just down in the gutter. It was good. It gave my sister the ability to go to college, and now she works for Boeing and is in the space race, she’s gonna be an astronaut… It’s crazy. She’s so smart, and had we not been able to do this deal, I don’t know if she would have been able to go to the college that she wanted to go to, and go the career path that she’s always known she wanted to do.
Joe Fairless: What’s a mistake you’ve made on a transaction?
Justin Stamper: In a transaction, I would say probably not talking to title enough. I feel like it’s a thing that everybody learns the hard way – not communicating with everybody on a transaction, to make sure everybody is on the same page… Because at first, you just assume things are going great and people are doing their job, but as time goes by and real estate happens, you realize that communication is so key, and even if you’re the annoying guy that sends 10 e-mails a day, CC-ing four people, at least that deal is gonna close on time.
But I would say my biggest real estate mistake, period, was selling the properties that I should have been keeping when I started wholesaling, when I started flipping… Had I understood rental property better when I was 21, 22, even 19 – had I understood cashflow better, and rental properties, and the abilities to creative finance things… Oh my god, I can only imagine what my rental portfolio would look like today. And now, moving forward in real estate, I’m trying to be like Warren Buffett – I don’t buy it ever thinking about selling it, I buy it to keep it.
So I would say that was my biggest mistake – not understanding rental real estate and only focusing on transactional flipping real estate… Because that’s a job, and sometimes real estate is nice to not be a job. It’s nice to have your tenants pay rent when you sleep.
Joe Fairless: Best ever way you like to give back?
Justin Stamper: I work with a group called Best Buddies – developmental disabilities; kids with autism, Asperger’s, Down Syndrome… I have a Best Buddy, I love her to death; her name is Erica, and it just tickles me to death to work with these kids and give back, and I’ve never felt more fulfilled. It’s really cool.
Joe Fairless: How can the Best Ever listeners learn more about what you’ve got going on?
Justin Stamper: Best Ever listeners, come find me on Facebook, it’s Justin Stamper. You can see me on Instagram, which is @FlipOrlando, or just go on either AmericanAnchorHomes.com and shoot me an e-mail, or go to JustinStamper.com, or better yet, go on and watch Zombie House Flipping, because we’ve got new episodes coming out soon.
Joe Fairless: Awesome. Well, Justin, thank you so much for being on the show and talking to us about how you started, how you have got to where you’re at, and in particular the story where the individuals who bought your foreclosed house, how they could have made more of a profit, but they elected to do a deal with you and your family, and how you currently partner with them on deals where they’ve made the money back and then some, plus they’re in the good graces of the Universe.
Thank you so much for being on the show. I hope you have a Best Ever day, good luck with season number three, and looking forward to checking that out. We’ll talk to you soon!
Justin Stamper: Alright, thanks guys! Best Ever!
