Ekabo Home Financial Freedom Mastermind Podcast
A podcast for those who do not believe they were put on this earth to work 40 to 50 hours per week for 40 to 50 years, to hopefully retire at the age of 65.
Ekabo Home Financial Freedom Mastermind Podcast
117. Reimagining Real Estate: Interest Rate Cuts, Advanced Airbnb Techniques, and Navigating Complex Renovations
Curious about how the Federal Reserve's recent interest rate cut could potentially reshape your real estate investments? This week, we’re back with a bang after a rejuvenating month-long break. We kick things off by unpacking the implications of the first interest rate cut in over four years and what this half-point reduction could mean for your refinancing opportunities. Discover how the current mortgage rates are evolving and what these changes could spell for your investment strategies. Plus, gain exclusive insights into a challenging renovation project in Philadelphia, where we navigate the complexities of probate processes in real estate.
This episode also offers a treasure trove of advanced property management tips, particularly for maximizing your Airbnb listings using Price Labs. Learn how to fine-tune your pricing strategy through gradual promotions and weekday/weekend price adjustments, enhancing your bookings and revenue, especially for large and luxury properties. We’ll also touch on the latest Boho interior design trend, balancing style with cost-efficiency. As a cherry on top, get ready for our upcoming Ekabo Home Network event featuring inspiring success stories from women trailblazers in real estate and entrepreneurship, complemented by authentic Jamaican cuisine.
🗓️ Tune in every Wednesday at 7 PM Eastern! Don’t miss out on our journey toward financial freedom through smart investments.
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Our Links
➣ Financial Freedom Mastermind Facebook Group - https://www.facebook.com/groups/53083...
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➣ AirBNB Host Referral Link https://www.airbnb.com/r/niyia41
➣ Ekabo Home Network (IG, Youtube, Email) https://linktr.ee/ekabohome
Niyi Adewole is a licensed realtor in Georgia, brokered by EXP Realty. Feel free to reach out at Niyi.Adewole@exprealty.com if you would like to work with an investor friendly real estate agent.
Welcome to the Financial Freedom Mastermind Group Podcast. Here we're all about breaking free from the 40 to 50-year work grind and accelerating our journey towards financial freedom. Join us every Wednesday at 7 pm Eastern as we explore different types of investments that can fast-track your path to financial independence. We serve as a hub for connecting with fellow members during our sessions so you can share successes, ask questions and keep the momentum going.
Speaker 2:Good evening everyone. This is Nii Adewale, host of the Acaba Home Financial Freedom Mastermind Podcast, and I'm excited to join you guys after a month hiatus. I was actually on my honeymoon, which was awesome and I highly recommend you know. I know we talk a lot about getting after goals and really working hard, but you do have to have some time to get away as well. It helps you to refresh your mind, refresh your body, refresh your energy and really come back stronger, and so I was gone for a bit, but now we are back and we're going to be kicking off the weekly mastermind group and the podcast this week to kind of get started for the back quarter of the year, and so there's a couple of things that happened today.
Speaker 2:First, that's pretty interesting is the rate cut. So it's been close to four years maybe a little over four years, actually a little over four years since we've had a rate cut. Back in 2020, they cut down significantly right to kind of address the pandemic, and ever since, toward the end of 2020 and really, you know, beginning in 2021 and 2022, we've been having interest rate hikes, little by little by little and then a lot by a lot, and we were able to get all the way up to about eight interest and you're looking to buy a house, and so now we're starting to see the reduction because they've been able to stop the inflation or at least get it into a range that they feel comfortable with, and because they're starting to see some breaks in the labor market. The Fed is actually easing up a bit on the interest rate hikes and now we're starting to see the reduction.
Speaker 2:And today I was actually factoring for a quarter point. I was thinking they were going to be a little more conservative, but we get a half point, which is pretty awesome when you start to look at what's happening with mortgage rates. But, nas, how you doing man? What's going on, nick? Not much, not much. Happy Wednesday. I know it's been a month right, letting everybody know that we are back.
Speaker 3:Absolutely, absolutely Excited to be back, actually.
Speaker 2:Come on, man. Did you see the news with the Fed chair earlier?
Speaker 3:today? Absolutely. How can you not talk about that news? It's great news. It stimulates the economy to where we're looking for.
Speaker 2:Come on, I think it's needed, especially that half point, like I thought they're just going to do quarter because I'm like, ok, probably just going to play it safe and just keep it consistent. But the half point, especially heading into one election season where we don't know what's going to happen there, and to the wintertime where historically it does slow down anyway, this is good. I think it'll hopefully counterbalance it. And to your point, yeah, man, from a real estate perspective, this is refinance season.
Speaker 3:Absolutely, absolutely. You know, I was hoping that it would drop just slightly more. I know that was a big cut so I was hoping for too much. Our rate is just it needs to be a little lower before I can actually capitalize on a refund. That makes sense anyway.
Speaker 2:Hey, come on now. I'm hoping that we're able to get there over the next year. They're factoring in two more cuts this year, so another quarter and a quarter, and then a hundred basis points next year. So four quarters For me. Somebody that got interest rates over the last two years in the nines, I'm excited for anything. I'm just waiting for maybe two more bets, maybe right after the election period and then going in to go try some refinement.
Speaker 3:Absolutely, I need one additional cut, and then that'll put me at at least one percentage. So then the refi makes sense. Come on now. I can't wait. I can't wait Because your interest rates.
Speaker 2:What are your highest ones at? Not the low ones, but what's your highest interest rate at right now.
Speaker 3:Highest one is 5.8, and then the one you helped me close on is 5.5.
Speaker 2:Getting close Right now. I want to say it's like if you're buying a new house, you could be around 6 right now, and so it's getting close.
Speaker 3:You know I was just on the phone with one of the uh brokers uh we're in contact with and he was able to close somebody the other day with a five seven.
Speaker 2:I was like that's impressive was there a lot of points on there, or did he mention anything about?
Speaker 3:that there was one um buy down for points fair enough If he did it without points.
Speaker 2:We're hanging up this call and calling him right now. Go figure that one out Like, hey man, let's go ahead and hook me up.
Speaker 3:Absolutely, absolutely. I was shocked when he said it because he started to call and was like hey man, guess what? I just closed somebody for like a crazy rate. He was like what, you get like a six and he was like he said five, seven.
Speaker 2:I was like man, that's crazy, yeah no, that's, that's good work, especially, you know, with what we've seen over the past couple years, and so it's just exciting first time in four years to see this actually starting to reverse the other way, and so, yeah, all real estate investors unite, this is going to be a good time period for us. But one other piece for you, naz. I know you were talking about it before, but you were working on a project, I believe, up in Philly where you're doing renovations, things of that nature, or get ready to start. How is that?
Speaker 3:coming. So it's interesting. A specific property. I'm in the probate process and so, because I'm not there, I've been utilizing some friends and family to get the ball rolling for me. A proxy took a little longer than expected. Hopefully everything closes out within like the next week. The lawyers are tying up the loose ends and then, once it's fully in my name, we're breaking ground.
Speaker 2:I love it, man. I love it. It's a patient game, right, a waiting game, but it's all going to be worth it.
Speaker 3:Yeah, hopefully, hopefully, you know, to that point. I broke ground on the property in Atlanta, the one in East Point, nice With rehabs, you're going to uncover some things. And they definitely uncovered some things, like on the first day, or what Well, they were actually really quick, gave the deposit. He gave me a call. He was like all right, my guys are showing up, we're starting demo. I was like, okay, start demo, let's get it going.
Speaker 3:And within about three hours of him breaking ground, he sends me all these pictures with, like, the studs having some water damage, the floor joists having water damage. You know, subfloor, there was one section that just was a complete, just throwaway Cabinets. They had damage. But I knew the cabinets had damage, and so what really frustrated me is this is all damage that was in the home prior to, and so I reached out to my tenant before evicting him and I asked several times, like, is anything wrong with the property? Do you have any issues, any maintenance things? And his answer was always no, everything's fine. And I'm like, all right, well, this is just a great tenant. Lo and behold, I get into the unit and, yeah, things are not what I expected.
Speaker 2:So no, it never fails, especially somebody that's been there for a while, because he'd lived there for a couple of years, right yeah. And so is the water damaged, or was it from a past experience it was from a past experience.
Speaker 3:It was pretty significant. It was dry, but you can tell that it was sitting. I was fixed for a while because it looked pretty aged. So it is what it is. You know it's. That's a part of the game. You know you run into these hiccups. You build in contingencies for it. When you don't have a contingency budget, you leverage it.
Speaker 2:Yeah, this is true, it's one of those where it's definitely painful in the moment, but you're ripping apart that house and the value that you're putting into that thing, just the first minute alone, minute alone. But I walked in there I was like this is night and day, you know. It's like absolutely, absolutely. So, yeah, the more you can do that, you're just going to be accelerating those rents and, yes, it's going to come back slow over time, but it's going to come back absolutely, and so the good thing is that that middle unit I'm going for airbnb and it's going to be great nice nice, as long as you don't put a friend in there that's going to stay there for two years, right, you know pay, that you know minimal.
Speaker 2:So yeah, we got to keep that one for a B&B because I think that will crush it over there. Man, Eastwood is solid for it For sure, for sure.
Speaker 3:The two bedroom is a crusher. It's like a in terms of projections. There's like a five difference from a one bedroom to a tworoom in that area. Yeah, that is crazy.
Speaker 2:And, speaking of short-term rentals, I recently actually sat down with one of the quote-unquote professionals in this industry and they spent like 30 to 45 minutes with me to go through pricing software. So I've been using like Price Labs and you're familiar with Price Labs, really Okay. So I've been using Price Labs now for like two months, two or three months, and I've been using price labs now for like two months, two or three months and, uh, I've been using just the basic portions of it, apparently right, like putting the minimums in, putting the base price and then making some adjustments quote-unquote seasonal. This person in a 30-minute session took me through adjustments I didn't even know you could make. For example, one of the things that because I wanted to help optimize the back unit but then also understand how to do this for all of our portfolio, and so I've actually set up time for Friday to knock out the rest of the portfolio, but I've already been for the back unit and I'm seeing the results already. And so a couple of tips that he gave me is there's something in Price Labs and you may have already known this where you could do a gradual promotion or a gradual decrease. Does that make sense? Have you heard of that before? No, but I am intrigued.
Speaker 2:Okay, so essentially, the setting that we put in there is a 25% discount right at 45 days out. So the way it works is it does it gradually over time. So at day 45, it's a 0% discount, at day 30, it may it's a 0% discount, at day 30, it may be like a 10% discount. It's the next day. If it's not booked, it's a 25% discount, and so it allows you to, without having to go in there and play with it yourself, make those adjustments. That's one of the things you showed me Absolutely.
Speaker 2:So another piece is just being able to do by the day bonuses, increases and minuses by the actual day. So Mondays and Tuesdays are not days that get booked a lot, so let's go negative 10, 15 on those days, regardless of the rate. And then days like Friday, saturday those are typically booked let's go plus 10, 15% and things of that nature. So he went through a myriad of things to where it really tightened up our listing and also showed me how to truly accurately judge it against the rest of the market, based on how we've got it set up. Like, hey, are we going for the luxury? Okay, this is a trend line that you want to be on and kind of move above this a little bit. And hey, do we want our weekdays to actually be in line with everybody else, to where we can compete? Okay, boom, we need to change this year, and it was incredible.
Speaker 3:Wow, man, that's a huge value add. As you were talking about it, it made me think about, like our large five-bedroom and four-bedroom homes that we manage Because it's going to kill them. You know, people usually book for about a week.
Speaker 2:And if they're getting a lower rate across the market for booking out for a week because Tuesday and Wednesday are low rates, that's going to kill them.
Speaker 2:Yes, and that's the key. And overall you're going to make it up on the weekend with the weekend pricing, but it's going to make it more attractive and get more of those weekday bookings right. And so, for example, for the back, what I have right now is we have somebody coming in this weekend, but now we have somebody who booked for from from, not monday, from tuesday through next weekend, tuesday through sunday, which is like, okay, we'll take that and it's and it's going to compound each other. So now look and do that for the rest of the properties, including the mansion, to figure out how, as we're going into the winter season, we can compete still at the luxury level but during the weeks, capture some of those bookings without having to actively jump in and mess with it. And now that I think you're on mute, I didn't even realize it. I thought you were doing sign language, so nobody knew like hey, listen, I was like no, I was just saying that's definitely going to be a strategy that benefits the mansion.
Speaker 2:Yeah, absolutely, absolutely. But what else you got top of mind, man?
Speaker 3:Um, you know I've been super busy with this renovation and trying to build out how I'm going to design the Airbnb, and so I'm trending right now. I may end up going that route We'll see but I'm thinking of designing one of the bedrooms in Boho. You ever heard of this like new design style?
Speaker 2:Yes, and not willingly. My wife's a designer, right, and so, yes, I design style.
Speaker 3:yes, and and not not willingly, my wife's a designer right, and so, yes, I've heard of the boho, but what are you thinking? Um? He's the mock-ups color palette is going to be in the range of like green and and like uh, what's that word? Like brown, but like woodwick brown, not woodwick, is it woodwick wicker, wicker brown? He's looking into finding these, um, lights go across the back half of the room. I don't even know how to describe it. The mock-up looks pretty decent and I was like all right, well, I'm interested, how much is it? Which is the part that no one likes I always go for. How much is it?
Speaker 2:That's the part that's the most important. Listen, if the boho is going to cost us $50,000, let's not do that. But to your point, yeah, that's a hugely important thing. When it comes to the short-term rentals, and we actually have a property indicator that went heavy on the Boho design, for it's like a two-bed, one-bath and it crushes it. Over the last year it's had a mid-term renter in there, so now we got to get it kind of re-acclimated back on the short-term side. But before we had that, yeah, I mean, is it which decatur? When is it? It's the modern farmhouse, but underneath got it, yeah, I think we called it the cozy bohemian, something, right? So it has the hanging lights. Once you said hanging lights and the color palette, I'm like, oh, this is that's the one. But no, I think that'd be cool, man, absolutely absolutely.
Speaker 3:So what else you got, man, I'm thinking? We talked interest rates and the Fed. We talked, you know, upcoming projects. How is the new project with the man? So?
Speaker 2:you're talking about the back unit of the Duplex. Yes, dude, that's been incredible. So we've made all the adjustments that we needed to do as far as like pricing and things of that nature, and the cool thing about having a luxury unit in your backyard is we can make sure that we're checking it before every guest, and so I've been able to find just small, small things right that could change a guest's experience, and so we've only gotten five stars so far. I think that's going to continue. Plus, we're able to put out specialized welcome packages right with wine you know, plantain chips and things of that nature in a handwritten note. Packages right with wine, you know, plantain chips and things of that nature in a handwritten note. And so I really believe that that one's going to be the one to take it to another level, similar to how we do the mansion. The mansion, we do have somebody dedicated who goes in there for every check-in because it's worth it, right. But when you get to 30 units and some of them are bringing in $75 or whatever for a day, it makes it kind of difficult to do that for all of them across the board. But for the luxury ones, it makes sense, and with this one, you know, in the backyard it makes a lot of sense. So I'm pumped for this one, excited it's going well. There's always some kinks you got to work out. You have to be ready for that, right? So let me even get into that. So, right, so, let me even get into that.
Speaker 2:So while I was gone, I was out, right, we had our first three stays, and I always like to tell um new owners of short-term rentals that within the first 30 days, for the first couple stays, there's gonna be some random stuff that we find out about the property, especially they hadn't been lived in for a while. And so the first thing that popped up was when they built the unit, the the people when they were were drilling the drywall. They accidentally drilled and hit one of the pipes that led into the. You know how you have those handheld sprayers. So it was drilled into the handheld sprayer. So the inspector wouldn't know this, because the water's spraying, they're like, okay, the water's pressure's good and all that stuff, but when you flip it over, when the cleaners flipped it over to the actual handheld sprayer, the pressure dropped completely off and they started seeing water leak under the wall. So we had to get that fixed. We ended up cutting the wall open, understanding like, okay, that's what happened.
Speaker 2:And then the other bathroom upstairs while a guest was staying there. Thankfully, we reacted quickly. They sent us pictures of like water leaking into the living room downstairs and they're like, yeah, we think it's from the bathroom upstairs. I'm like, ah crap, this is a tub. So we send the plumbers out there and, long story short, what they find is that the pipes were not fully tightened behind the wall and they had to actually go through the tile to get to it because the back of the wall was the outside of the house and so that cost a bit. But it was fine. And when you got through those two things, now the house is operating well, but there's always going to be something under the first couple of steps.
Speaker 3:You know. And so, in hearing that, the first thing I think about is, when builders are coming in and they're going through the project, any simple things that they'll forget, like plumber's tape or just putting that extra torque on the pipes. And now you created a larger problem because you are, you know, slow and deliberate every time. Every time, cause it's not like something that's uncommon, it's a very common thing.
Speaker 2:It's true, it happens all the time and it's it's in most professions, but definitely in construction. The 90% is not the easy part, but that's the part that everybody's focused on, and that last 10% is the piece that gets left. And so, as much as you can, you've really got to either build into your contracts right, if you're the one that's our contractor make sure you're withholding a significant portion back until that 10% is complete, ie the project you're working on, wic-wic and then also with builders, we held them to the gun on a lot of different items. This was something that just it was hard to discover, right, until somebody's saying there and they're like I took a whole shower and a bath and now this thing's leaking.
Speaker 2:But, it's, it's part of the game.
Speaker 3:And you know, to that point. It made me think about the punch list, right? So you've knocked out 90% of the project or 95, honestly and now we got this last 5%. I've do the property walkthrough and now identify a list of things that needs to get done and like, if we're being honest, this is something that could probably get done in a week if you just dedicate the time and then it takes like two weeks, three weeks. I'm like, dude, get it together and then they get with you when you're you're pushing the hammer, like let's get this done. I'm on a timeline here Mind-boggling. It's like the smallest things I did my first build out the last two weeks was just they didn't put all the handles in the kitchen and they forgot to like tighten something small, and it's like I could definitely go in there and do some of that stuff myself, but I paid you, so I'm going to need you to go in there and do some of that stuff myself, but I paid you, so I'm going to need you to go in there and do it.
Speaker 2:You guys, literally the handle thing, I forgot all about that. They forgot to put a bunch of the handles too. We had to get that before closing. And then still, I missed one handle for like a drawer that was like a hidden drawer, oh man, so I had to go buy an off-the-shelf handle to put on. So yeah, it always, it never ceases, it never ceases. And to that point, if somebody were to build a business around just getting the job fully finished and created and you build a reputation around that, you can make a lot of money. Some of these big builders that's how they started out Just build a reputation, keep going up, going up, going up. The next thing you know you're in the money.
Speaker 3:Hey, we got to get a bell on here, man. That was like a bell moment, seriously. You're in the money. Hey, we got to get a bail on here, man. That was like a bail moment. Seriously, that is a huge friction point in the value chain, right? So I get to the last part of my project and now I'm running into the hiccups that no one wants to deal with. Deal with it for you, yeah.
Speaker 2:And the piece that I hate the most in that last percentage is because they're usually banging on the's like guys. No, here goes what we agreed to. I need it done Right. Once it's completed, I will personally drive over and hand you the check Right. They're having it right now. I'm looking at it.
Speaker 3:You just hit a soft spot. I got to pay. My guys Like no, I understand what you got to do. I know what you got to do for me.
Speaker 2:This is true, but the other piece that we got coming up now is the event, and so how's the event coming? Anything you want to say about it?
Speaker 3:Yeah, yeah. So the event's coming along. You know, recently the switch people have been booking has gone up significantly. We're getting closer to the date so people are actually going in. You know last minute bookers we are maybe a couple percentage away from where I thought we would be at this timeline. It's going to be a great event. Percentage away from where I thought we would be at this timeline. It's going to be a great event. I was just on the phone with one of the guest speakers at what they have in store is going to be nice Many ideas. They were calling me the other day like, hey, so have you guys considered this? And I'm like, no, I didn't, but I think that's a good idea. How do you want to work it in? I think it's going to be a great event and you know, for the people that have my personal number that has already booked the event, they're super excited. So I can't wait.
Speaker 2:Come on now. I'm pumped too, and the event he's talking about is the Breaking Ground event. We sent it out to the Acaba Home Network a couple of weeks ago and we're probably going to resend it out either next week or maybe next week and the following week as we lead up to it, and we'll definitely be able to dive into a deeper conversation here next week. But if you have not booked that already, go ahead and head over to akabahomecom. It is the link there. You can click it, reserve your spot. It is free. You're going to have awesome food, amazing networking and some pretty cool women in real estate and entrepreneurship that are crushing it that they're going to share their story.
Speaker 3:And so we look forward to seeing you there in person and to celebrating this next networking. And you know, I got to do a quick little plug on that piece because the caterer, the food's going to be amazing. So when I say is authentic, it is authentic. Texting the caterer today and she was like I'm sorry, I've been a little, you know, slow on responding to the country. I was like I'm sorry I've been a little, you know, slow on responding to the country. I was like, oh no, take your time, you're good. It was Jamaican food. Lo and behold, she's visiting Jamaica. Oh no, she's bringing that recipe back man.
Speaker 2:No, no, I'm pumped. I'm pumped, nas, I appreciate you joining tonight. We're going to be sending out the message next week. So, one, let people know that we're back it's been a long month and then two, to re-promote the event that we're going to have here in about three weeks.
Speaker 3:Any last words? No, I'm looking forward to it, and you know just keep crushing things.
Speaker 2:Come on now. I will catch you a little bit later. Be safe, and we'll make it happen. Man, absolutely Take it easy, see ya.
Speaker 1:Join.
