From Burnout to Breakthrough: Turning Pain Into Purpose and Profit with Jim Boad

Transcript

[Mattias]
Welcome back to the REI Agent. We’re here with Jim Boad. Jim, thanks so much for joining us.

[Jim Boad]
I’m glad I could be here.

[Mattias]
Jim, give us a bird’s eye view of who you are and what you do in real estate.

[Jim Boad]
Well, I’ve been a real estate investor for over 25 years. Started out as a straight up raw dog fix and flipper in the Metro Phoenix area. One house at a time, just grinding it out, doing almost all the work.

Built up a pretty big team doing that. We were running between 12 and 15 projects at a time in the Metro Phoenix area. We flipped a lot of homes.

We built a whole real estate team around that. Started getting into the burr method. Then right before the market crash, I saw it coming, but I didn’t really know what to do.

I started an REO team and a property renovation company. I killed it, but I hated my life. Running REOs was the worst thing I’ve ever done.

It helped us survive. Then after the market settled back out, I started reinvesting, but in Washington State in 2014. I went right back to the grinds, just right back to what I knew.

Started off on fix and flips and then got into developments. Then COVID came up, and I was burring a lot, and I was building my rental portfolio and thought I was on a path to an early retirement. I had a little shock there.

But what that opened me up to, though, was that opened me up. I found Sober Living. I now run Sober Living Homes, and I teach people how to start and scale Sober Living Homes now.

[Mattias]
Okay. There’s a lot to unpack. 25 years in 30 seconds there!

Yeah, yeah. You’ve got a lot of history. I guess it would be what one could assume that the Sober Living method is now your favorite of all the things you’ve had experience in.

[Jim Boad]
It really is, for two reasons. First and foremost, the heart feel that I get from it is insane. I really help, and I save lives.

It’s a magical, magical thing that is so needed and so under represented. Two, the cash flow is ridiculous. I’ve never had anything that cash flowed like this.

[Mattias]
Well, Jim, that is the problem right now. It is impossible to find deals that pencil out, and people are having to get creative with what they’re doing. Even a BRRRR method, that used to be where you could get a good deal and you would flip it, essentially, and just keep the money in the deal instead of selling it and getting the profit.

But that would afford you to get a rental at a cheap price that you would never be able to otherwise. With interest rates being lower, it also meant that things cash flowed right away pretty well. I have a few that are definitely my top performing assets because of that method.

But then the last one we did, it was not possible to cash flow. We have 30% equity in it because we did a DSCR loan. It’s not going to cash flow at all.

We had to turn that into a midterm rental, which now that has helped us. There are a number of strategies now these days that people are using, like midterm rentals that’s been gaining popularity. There are putting a bunch of people, workforce housing kind of thing.

You shop at the house and make every possible living space into a bedroom you can, and let people kind of rent out a room. They just want to crash really after a hard day of work, shift workers, that kind of stuff. Then there are assisted living facilities and sober living facilities.

What brought you to that strategy? How’d you land there? Where did it go?

[Jim Boad]
It was literally doom scrolling after looking at my spreadsheet of just red. It was literally like a switch went off. I was in Washington State with all these, and we are not a landlord-friendly state as it is.

When COVID hit, it was just all on moratorium. Over half of my tenants stopped paying. I reached out, what’s going on?

Is there a problem? Did you lose your job? Oh, no, no.

Everything’s great. I don’t have to pay you anymore. They weren’t wrong.

There was literally nothing I could do. You couldn’t kick them out. You had to keep doing repairs or you’d get in trouble.

Some of my paid utilities on, I had to keep paying utilities. Found out that cables are right. If you offer cable in a house, you can’t cut cable off when they stop paying either.

Wow. It’s for internet. I killed it.

I got an attorney letter to turn the internet back on. I’m like, but they’re not paying. I can’t afford it. They’re like, it’s your obligation.

[Mattias]
That’s crazy.

[Jim Boad]
Yeah. I found a site. They were talking about just generalized group homes. Start a group home and you could retire with three.

They weren’t wrong. They weren’t lying with what they were talking about. I dug in it, ended up buying the course that night.

It was just a quick little online course. It was like six modules. Burned through it that night.

Within a few days, I started converting some of the stuff I had. I had active projects. I had stuff I was still working on.

I had some duplexes I was building that were almost done. I just started converting all those right into sober living. My very first step was I got with some local nonprofits that dealt with homelessness.

That worked out really well for a hands-off model. That one was really good. They paid a little above market rent and they took care of everything.

They paid utilities. They took care of all basic repairs. I’ve always had a passion to want to help.

Drugs and alcohol has touched my life as a child. Both of my parents were alcoholics and drug addicts. It definitely— I was blessed that I saw what I never wanted to do, but it still really— it still ripples through my family.

It ripples through my friends. I don’t think I know anybody who hasn’t had drugs and alcohol touch them somewhere in their life.

[Mattias]
I mean, it is definitely a great cause and definitely needed. It makes sense that having that to be impactful for you would be a passion cause. When you first talked about it, I was imagining a large, large facility type deal.

Then you talked about converting your rentals that sound just like normal units into them. What does that look like typically? What can you turn into that?

[Jim Boad]
To the main point, they look like a regular residential rental. I don’t do a lot of converting and things like that. I build a little different now, but we can get into that in just a moment.

Really, for somebody wanting to start this, I recommend no less than a four-bedroom. A five bedroom is kind of the sweet spot. Of course, if you can get more, get more, but it’s not insanely hard to find a four or five-bedroom home without having to make the garage and the den and half the kitchen and the bedroom because people do that.

I don’t promote that. That’s not what I teach people to do. It’s not just the biggest cash grab there can.

You still want to have a quality of life. There’s well-run homes and there’s poorly-run homes. The poorly-run homes are the ones you see in the news.

The well-run homes, you don’t even know they’re there. But that’s how it’s run. In most states, you can do it completely unlicensed.

There’s only five states that are challenging to do it in, but you get paid a lot more when you do it in those states because you do have to go through a little bit of process. Anytime you put friction there, you do end up getting to make more money.

[Mattias]
Is there on-site staff the whole time? Is there? What are you doing now?

[Jim Boad]
I teach two different methods of how to run them. I’ve run them off of both. You can use the peer-run method, which it works.

I don’t like it because you’re never really building a business there, though. You’re constantly going to keep turning whoever’s in charge because the ultimate goal with these homes isn’t for someone to come and live there for the rest of their life. This is for them to come there, get stability, get their mind back to right, get their habits back to right, and then move on with life.

I don’t want to constantly be training a new person, so I hired staff right out of the gate. We run about 50 beds right now. My staff is about part-time because they hit the houses almost every day.

We’ve got a 10-minute walkthrough checklist. We do pop buys. We do stuff.

You can run them either way, and they can be very efficient. I just prefer building a business and not a job for myself because when I put people living there in charge, I end up creating a job for myself because when they’re not around or when they leave, now I’m taking it back over. I don’t go to my homes.

I check on them and stuff because I want to, but I don’t run my homes. My team runs my homes for me.

[Mattias]
Sure. Okay. But it’s not like somebody’s there 24-7.

[Jim Boad]
Not at all.

[Mattias]
Yeah. Okay. Yeah.

Okay. Well, yeah. That’s interesting.

I know I just interviewed somebody who had turned a duplex into, I think, a home for mentally disabled people, and I think they had that set up as a triple net lease, which that’s kind of interesting as a residential property run that way. But that’s definitely them leasing it out to somebody that’s fully taking over, doing it themselves, et cetera, but you’re running an actual business through this, and so that’s a little bit different. And obviously, something like that might need more on-site staff constantly than this kind of thing would.

[Jim Boad]
Without a doubt. I have an uncle who’s in one of those facilities in the Metro Phoenix area right now, and they’re just starting out and they’re kind of poorly run. He’s probably not someone who should have been accepted in there because his level of care is very high, and they’ve got a very low level of care, but there’s just not a lot of options where else he can go.

So it’s a tough one. I hope he makes it in there for a while until he can get to a better place for him.

[Mattias]
Yeah. That’s a need there for sure as well. Yeah.

Oh, sorry. I thought I had it on do not disturb mode, guys. This life of a realtor, you get phone calls, you get texts.

I try to keep that do not disturb, but one got through, guys. No. Okay.

That’s fascinating. I mean, you said that you kind of are building houses differently, and you mentioned developing early on. So now are you pretty much just focused on building new specifically for this use?

[Jim Boad]
For the most part, when the right deals come by, I don’t look for projects anymore because when I look, I find them, and I need a sober living home for myself to not be an investor because I am addicted. I love flipping houses. I love building houses.

My wife’s like, you need to stop.

[Mattias]
Yeah.

[Jim Boad]
Just some basic things that I do a little bit different is when I’m building out my new homes, what I do is I will put like for the master bedroom, I will build a master bedroom entry from the master, but I end up covering it over. So I’ll frame the door out, but then I rock over it, and I put one in the hallway just because when you do master bedrooms in these, I can’t really charge. I don’t charge more for someone being in that room, but I’d rather have more people be able to use all of the facilities.

So then that way, there’s no private facilities, but long-term, it’s a little bit of sheetrock removal, and then a little bit of sheetrock work, and boom, it’s back to a normal home.

[Mattias]
So you can sell it or whatever, change the use of it.

[Jim Boad]
I do closets in almost all of my rooms, but again, you could get one big closet in that room, or you could have like two nice closets. Just little things like that that won’t hurt me in the long run, but really help run this model because I put two people per bedroom. And there’s two reasons behind that.

The first one is the rate of recidivism or them relapsing is so much less when they have accountability. Putting people in their rooms alone, almost everybody that has relapsed has relapsed in a solo room because I do have some places because there’s a square footage formula for rooms, and if it’s under that, it’s 120 here, 120 square foot for two people. I’ve got some places that are like 110.

I can’t put two people in it legally. So those rooms are solos, and if I don’t graduate somebody into the solo rooms, they tend to relapse a lot faster. And then of course, cashflow.

When you’re putting two people in a room, you’re getting twice the rent for that room. So it makes it make a lot sense. I get $8.50 a month per bed. So you start doing the math on a five-bedroom home, $8.50 times 10, it starts mathing.

[Mattias]
Yeah, definitely a lot more. Well, how are people discovering this if they need it? How does that all work?

[Jim Boad]
Well, that’s another beautiful thing about this model. I get in touch with the inpatient drug clinics. So people go in to get clean because that is the difference that I think a lot of people don’t understand.

We don’t help you get clean. We just help you stay clean. You’ve got to go for treatment.

So we don’t take people off the street. We take people from treatment centers. So one, we’re referred people.

We have a waiting list for our homes. We have a big board. We get called almost every day with someone looking for a bed, and they normally come to us with some sort of government subsidy.

So they’re coming to us with their first three to six months paid. And then one, we help them find other alternative payment methods as they get closer to their date of like, hey, you got three months. Cool, you’re on month two.

You’re going to run out next month. Do you have a job? Do you want to stay?

We can take you to self-pay. Or here are five resources that if you start calling them now, you can probably keep your funding going with other resources.

[Mattias]
Wow, okay.

[Jim Boad]
I’ve got some people that have been in my home around in three years now that have resources that have been paying for them for that whole time.

[Mattias]
For three years. I was going to ask then too, like, what’s the average stay per person?

[Jim Boad]
Six months is fairly average for us. I mean, we have people that fade out right away. We literally had a guy come.

He came out of rehab, came to the house, checked in, went to the grocery store, bought a bunch of groceries, dropped all of his stuff off, put a lasagna in the oven, and walked away and never came back.

[Mattias]
Oh, my gosh.

[Jim Boad]
Like, they had to pull his lasagna out of the oven for him. I mean, like, it, so like, it happens, but that’s rare. That’s not, that’s not a normal thing for us.

But, you know, really, for me, I feel like six months is kind of that low barrier that you really need to be in a place like this. And it’s not that we make people stay or make people go, unless we have to. But it’s just, it takes time.

It just takes time to really recover from this, especially with fentanyl and, you know, the meth that’s out there now, and they’re cutting everything with fentanyl. So, it’s just such a gnarly drug that just gets you, and it changes you. So, you gotta, you gotta kind of come back to life and come back to who you were.

And in less than six months, I don’t feel like you really hit that baseline. And I’m not a, I’m not a doctor. I’m not a clinical person.

It’s just, that’s what I’ve seen. So.

[Mattias]
Sure. That makes sense. What kind of, I mean, so are there, are there lead activities then that are happening to kind of, you know, I’m imagining like AA meeting kind of like scenarios in the living room.

Like, is there anything like that that you facilitate? Or is it stuff that is kind of run through other, other organizations or, yeah.

[Jim Boad]
It’s, it’s all run outside. Pretty much everyone that comes to us, they have, they have structured stuff they have to do. Some people have three, four classes and things a day that they end up having to go to.

Everybody goes to some sort of NA or AA. And then we require two meetings a week, and we’re pretty flexible with our meetings. Like if you want to, if you, if you need to go to NA, go to NA, AA.

There’s a bunch of different style ones. We’ll let people, if going to church is what’s going to help you, we’ll accept church as one of your meetings for the week. And we run really strict rules.

And one of the things that has been really nice is we have been up to this point. We have been protected in removing people from these homes because they’re never a tenant. They’re in a program.

So if they ever take that away, these won’t work anymore. There’ll be, there’ll be no help for people because if, if I have to let people use drugs and stay in the house, and I can’t, I can’t help them then. So my fingers are crossed that we keep, we keep getting protected with this and you know, we’ll, we’ll see.

[Mattias]
Yeah. It’s just one of those things that, you know, on paper, it sounds nice, you know, to like, to not remove people that need help from a facility. Right.

You can see how it would be spun in a way, but you know, then to your point, like, you know, like one person that’s, has to stay there still is using, it’s going to make everybody else probably start using again. And it’s, that’s a slippery slope. That would be really tough.

[Jim Boad]
Quickly too. It’s, it’s really, we, we, we take our obligation really personal and, and to heart that we’re there to protect everyone that’s in our home. And if someone’s standing in the meth out of their mind, which we’ve, we’ve, we’ve, we’ve seen and we’ve got to get them out of there.

It will, it will spread like wire fire, wildfire in that house. Plus when there’s no rules, there’s no rules like, Oh, well you can do methods to deliver. Well, then I’m going to drink.

I’m going to smoke pot. Like I’m going to like now, now I’m just giving you a comfortable place to do drugs. That’s not, that’s not what I’m looking to do.

[Mattias]
Yeah. I mean, that’s a good question too. I guess I didn’t really think about like, what is it?

What are the rules? Like, I mean, like, so is, is marijuana considered also like that’s off limits?

[Jim Boad]
Like, you know, yeah, we, we do, we, we don’t allow anything other than prescribed medications. Okay. And you know, they’re, you know, everybody’s got lock boxes for their meds.

So like when we, when we might get people do their walkthroughs, their meds need to be put away. You can’t be doing med swaps and things like that. Um, we’re, you know, the majority of people that come to us, though, want to recover.

[Mattias]
Sure.

[Jim Boad]
They’re there to work the program and, you know, and it’s, it’s our obligation to hold them accountable to that. And it’s, it’s, it’s what they need. And it’s why these programs work.

[Mattias]
Yeah. No, it makes sense. Like, I mean, yeah, you, if they’ve gone through the treatment already, I mean, like, if you’re not the, the limited exposure I’ve had to addiction, like, you know, if they’re, if they’re not ready to, to try to work on it, it’s just not going to work.

Like they’re just, it’s, they have to be, have some kind of, I don’t know if rock bottoms, what brings people to it. I mean, that’s kind of like maybe a cliche term, but, um, I think, yeah, like there just has to be some sort of motivation stronger than the addiction to, to try to, to, to beat it. Right.

[Jim Boad]
And I would say you’re right. It normally is rock bottom because the majority of people that come to us, that is where they’re coming from. They’re coming to us with a garbage bag or two full of clothes.

You know, they’re, they’re, they’re starting, they’re kind of starting over. Like, I mean, it’s, it’s, it’s why it’s so needed though, because it’s that bridge, because where do you go? If you don’t have a sober living home, you go right back to where you were.

And when you go right back to where you were, what do you do? You do exactly what you were doing. Yeah.

We had a guy relapse recently and it’s because he went home. He went home. I’m going to go home and visit.

And you know, he’s been doing so good. He was standing around with all of his friends and somebody had a little meth pipe and hit it and handed it to him. And he took a hit and went, he actually, he called us and said, I just did meth.

I’m coming back. And what can I do? And we actually put him back into rehab.

So we don’t, we don’t just kick you out like plan. Like if, if you try to lie to us and don’t have any remorse and don’t care, and you’re just like, I can do what I want to do. I’m an adult wherever you want.

But what we did is he went back to another 30 day rehab program. We saved his bed for him, you know, so he got to come back out and leave his room set up the way it was. And you know, he, he ended up going through the program and now I think he’s back back with us for like three months, but we put him on even more intense stuff.

Like you have to go to a meeting every day for the first 30 days. Like, so, you know, we, we do hold people really account. It’s not just, these aren’t just flop houses.

They get a bad name for that because they’re out there. People, you can cashflow like a King on these and not care and let them sell drugs out the window and be high and drunk in the living room and still collect money. But you’re not, that’s not my mission.

That’s not, that’s not people I’m trying to help. So.

[Mattias]
Yeah. I mean, it’s, it’s what, it’s a cool thing because I mean, obviously you’re very passionate about, about this and, and for a good reason and like, you know, doing a lot of good for people. Is there, is there some sort of graduation program post?

Like, again, is that more handled on the other things that they’re involved with like AA or how does that look if they are kind of moving on and to prevent the relapses and stuff?

[Jim Boad]
Well, through AA and things like that, they definitely get all of their markers and their coins and things like that. So they do have ceremonies with that kind of stuff. What we do that I really love and it’s a big help is we provide a lot of work.

We own a restaurant and the majority of people that work in our restaurant actually have gone through our program. I own a construction company. I hire guys there.

We just started a nonprofit and we’re doing things like we’re giving scholarships for one, if people need rent help, but we just sent some guys through flagger school. So now they’re certified flaggers with the state. So they can go get state and federal jobs being a flagger, which start in like the 30 plus dollar an hour range around here.

So like pretty decent jobs for our area. I’m not in Seattle. I’m gonna, I’m outside.

My town only has 11,000 people in it and my median home price is 375. So we’re not, we’re not Seattle. You could actually probably buy a house almost.

But we just, we’re getting to start a small cab company because the one local cab company we had in town went away and we don’t have Uber here cause it’s not a big enough area. So like we do a lot of things to try to promote them to get back on their feet and do good stuff. We give good recommendations for them for when they’re, when they’re applying for jobs.

Yeah.

[Mattias]
Well, that’s awesome. I mean, you’ve, you’ve got your hands in a lot of different things and then you’ve got a restaurant. I mean, that’s, have you been described as a serial entrepreneur?

[Jim Boad]
Yes. But, but I would say one of the biggest things that’s helped me with that though is you know, of course in the beginning I, I, I overextended myself a lot, but I build everything as a, as a business, kind of like I talked about on the front end. I don’t, I don’t, I don’t like to build jobs for myself.

I like to build a business where I can top line, run it, kind of look at, look at my numbers and look at what’s going on, on paper. And it kind of tells me what’s happening within my business. Hey, we’re having a problem here.

You know, we’re, we’re at 40% labor and when we should be at 30, we, you know, what are we doing? So.

[Mattias]
Yeah, no, that makes sense. I guess going back to the, the, the, the being stuck in the, the whole COVID can’t remove any tenants situation. How’d you get through that?

I mean, what, what tips would you give to people who are in states that have a difficult time, you know, evicting people?

[Jim Boad]
Well, we had, we had two ways that you could evict people during COVID here. You could sell the home or you could move into the home. I started selling all my homes.

Wow. It’s just, I mean, it, it, it devastated my longterm wealth, if you will, because I wasn’t prepared. That wasn’t what I, that wasn’t the plan.

I had another 10, 15 years of building equity in those homes. Plus I was doing it with, with people in them. I was, you know, like it’s, it’s just, as a realtor, you know, the ideal way to sell the home is with it vacant and staged.

Like these were lived in and trashed.

[Mattias]
And they would have absolutely no motivation to, you know, work with you at all at that time.

[Jim Boad]
Every step of the way, telling people they couldn’t come in. You know, I mean, it just, I ended up having to show up for showings. I mean, it just, because, because, you know, I’d give them proper notice and be like, legally we get to come in.

I gave you a notice. Like, so it, it was, it was not fun. And I sold all my houses at discounts because I was literally bleeding to death.

[Mattias]
Yeah. Yeah. I mean, I don’t think people understand it.

There’s the landlord, the, the owners of property, like, I think like people assume that that person is just, you know, killing it and, you know, you know, making tons of money off of rent and all this kind of stuff. But like, you know, as you know, when you own property, you might have a couple hundred dollars of cash flow, whatever projected with all the good things that you, you know, you’re supposed to do, like save for a CapEx, all those kinds of things. But, but you have an HVAC go out or something like that.

And, and you’re, you’ve made nothing, you know, like it’s- Two years of profits gone.

[Jim Boad]
Like, boom, here’s your HVAC.

[Mattias]
And, and, you know, and it’s just, it’s tough. Like it’s, it’s, it’s a great thing long-term. You know, that kind of thing doesn’t happen.

Like, you know, the, the, the real wealth is, is in that, you know, the equity that’s growing, especially I’m sure in an area close to Seattle, but I’m sure that you saw a lot of growth through COVID and all that stuff too. But, but yeah, so like, then to have that on top of it where, you know, you’re forced to do these kinds of things, or people are just obviously taking advantage of a system. Like it’s not, the intent is, you know, big hearted.

It’s, it’s, you know, we don’t want to put people on the street. There’s a pandemic going on, but the result is, you know, terrible. Like it’s, it’s, yeah.

[Jim Boad]
It was one-sided big hearted because there was, because, because like you said, I think everybody thinks that we’re like Blackwater and we’re out there buying homes cash. And it just doesn’t matter to us. I mean, most landlords that are buying homes, you know, they’re small, they own one or two rental properties.

It’s their nest egg. Like they’ve, they’ve saved up that 20% down for the past 10 or 15 years to get into that home, or they moved out of their first home into a step-up home and were able to work out how to do it and keep this one. And like, like you said, I mean, I think, I think I had a banger of a house and I was making like 400 bucks a month after all my expenses and stuff on it.

I mean, yeah, that’s good when you’re collecting it. But for me, one eviction, one eviction that I have to run through, because, because up here they have free attorneys for, for tenants. It’s $7,000 in attorney fees is what I spent on the last eviction.

It took me 90 days to get them out. So I had to make three mortgage payments on top, well, more than that, because it wasn’t even done. I still had to do repairs and the guy was messing the house up and kept calling me.

He was damaging things and making me come fix them. And then after, I think I put about six grand into the house to renovate it back up to the standard that it was at. I mean, it was just, I was 15, 20 grand into just that eviction.

Like it was a nightmare. And then do that times three or four or five of them. Yeah.

[Mattias]
Yeah. And it’s good that we’ve had this long conversation about how big of a heart, heart you have and how much you’re trying to help people. Right.

Because like, it’s, it’s people, yeah, again, assume the wrong thing. And like, it’s, it’s people taking advantage of situations, they will if they’re, if they’re there. And, you know, we can all agree that, you know, we should all pay our way.

I mean, or there should be some sort of payment for services, etc. Like it’s, it’s literally robbing you. And you got robbed so many times.

[Jim Boad]
And legally, the attorneys made me settle because they were going to take us to trial if I didn’t settle. And their settlement is, you can’t charge him anything back rent, you can’t charge him damages, and you can’t report him to credit or tell anyone, we’re going to basically just expunge this case. So it’s going to show like he just left here, this guy put me down, and they were calling me as a reference on his next rental, just the cojones on these people.

I talked to my attorney, he’s like, you don’t legally have to respond. Because I’m like, I don’t even know what to do. Like, I can’t say anything.

Like, what do you what do I even do? He’s like, just don’t even call him back.

[Mattias]
Oh, my gosh, that’s crazy. I had a guy, I want to say from Portland on the show at one point, and he had whole like this whole strategy of how to get tenants out. And he had this whole like, kind of like, like vigilante type.

I think it was like a program he was selling. So he didn’t really get into all the details. But I think it was like you, you almost had to move somebody else in.

[Jim Boad]
I think I’ve seen this guy.

[Mattias]
You know what I’m talking about? And like, just kind of annoy the crap out of the person.

[Jim Boad]
That was just absurd. It is that that would feel good. You know, I loved rentals until I didn’t.

I mean, those rules changed. Those rules changing changed it a lot. You know, and you know, now like with with the people, even even when we remove people, but like, if somebody goes into self pay in one of our homes, we’ve got a couple people right now we’re working through it with them with like, hey, you know, your funding ran out, you don’t have a job yet.

You if you if you mow the lawn and keep the kitchen clean, you know, twice a week, I’ll keep working with you. Okay, now you’re working, give me 100 bucks a week until you’re back on your feet. You know, and just as long as we have a plan working through with people, because it’s not about just kicking them out.

Oh, you’re out of money. You’re gone. Or you just hit hard times.

We had a guy with a CDL came in got his CDL while he was living with us was was long haul truck and loved love what he was doing. Had some back tickets from California or something 15 years ago that caught up to him. They froze his CDL till he took care of that.

He had like fines or something. I don’t know how I don’t know how he got it. And then they found it, but they did.

So I mean, he went through like three months without paying rent, but we worked through it with him. He’s back to work now the banging out his rent, like, there’s always solutions, but not when not when you just tell me I don’t have to pay and there’s nothing you can do because I have a free attorney. Like, right, you’re right.

I can just I can get my attorney and our attorneys will give you an exit date. Like, yeah.

[Mattias]
Yeah, no, I hear you. It’s it’s and I’ve done that too. Like I’ve had some, you know, I’ve had some people tell me that I was too kind to some tenants where through through COVID, definitely people living, you know, extreme paycheck to paycheck.

And then, you know, having a series of unfortunate things happen, trying to put them on a payment plan to kind of get them up and back on their feet. Yeah, there’s it’s tough. Like, I mean, when you’re living that close to the line, like, and to your point, like, they were trying, they were trying to make it work.

Like, so it felt a lot different than hiring an attorney or whatever, and we’re just refusing to pay like it’s that’s totally different. So, you know, and actually this, this, we’re waiting for a bill, but they sent us a or I got a message, of course, at four like 40 on a Friday saying, Hey, our, you know, we ran the washer, and then all the toilets started bubbling up and a little bit of water came up into the bathtub. And I was like, Oh, no, of course, you know, we’re gonna have to have an after hours emergency visit or whatever.

And I said, it’s going to be more expensive, like, you know, is if there’s any way we can reduce water, you know, and try to get through to Monday, that’d be great. But definitely, we don’t want any backups happening. So like, you know, keep me posted.

So like the next day, it’s like, Hey, the toilets aren’t fully flushing. So it’s like, all right, and got a plumber to come out. Don’t know what the bill is yet.

But they found a tampon was flushed down the toilet. And, you know, clearly in the lease, if it’s something that they did, it’s their responsibility. Now I’m thinking, if that’s like a 500 $600 bill, I don’t know what it’s going to be.

That’s going to set them back drastically. It’s going to be like months to try recover that. And I’m probably gonna have to put it on the payment plan.

But it’s just tough when you have when you live that level of like, just paycheck to paycheck. It’s tough. It is tough.

[Jim Boad]
It’s really tough. And then imagine being there and trying to recover. Right?

I had a hard time doing it just when I was happy and healthy and just broke. Like, I’m chasing I’m being chased by a demon. And I’m living paycheck to paycheck.

[Mattias]
Like, yeah, totally get it. Just Yeah, everything’s just probably feels like it’s piling on you. But yeah, I mean, that’s what an awesome service you’re providing.

I was I’m curious. I know that this is very a passion for you. And like, like, it’s clearly you have something great going here.

Both. It’s a great business. And it’s both is helping people.

It’s a great win win. I’m curious if you if you looked into if you studied or if you just have heard other people talking about similar models to this, that you would think would also be like kind of a good model to run like like assisted living facilities for elderly or I mean, have you looked into any of those?

[Jim Boad]
Absolutely. I almost opened a long time ago when I when I was investing in the valley. I almost opened an assisted living.

My grandparents were riddled with Alzheimer’s. I mean, just the level of care that they took was really intense. So we looked into it at the time.

It’s just they’re a great business model. They really help a lot, but they take a lot to run. Like, yeah, you know, so I mean, you got to have full time staff, you have to have license a whole, whole layer of licensing that you need.

Because once you get into anything where you’re giving care, or helping with medications or things like that, you’re totally into a different level of you know, co living, you know, co livings back and forth. Some people are doing great with it. But again, you know, it’s, it’s, it’s still kind of the Wild West with co living right now.

Some of those rules are going to flush out where people think they can remove them from the home, because they are ending up being a tenant. And like, that one’s going to get under scrutiny. And my concern is, is that I don’t want that scrutiny to leak into sober living.

[Mattias]
Sure.

[Jim Boad]
It’s because really, they’re different worlds, like, we’re just fucking people just trying to live on the cheap and people that literally are struggling to survive at some points in this. So, you know, yeah, but like, there’s there’s lower barrier ones. Like I was saying, I’ve got an uncle who definitely has some some mental decapacitation.

He’s in a home right now. And it’s it’s very loosely run. There’s there’s not 24 hour care there.

There’s someone else who lives there who’s kind of in charge. But like, that person is not far off of the same level. And it’s just, you know, I mean, it’s, it’s, I see where it could be a really good model.

I just don’t feel like the example that I have is running it really well.

[Mattias]
Yeah. Yeah. I mean, I think you have to really take that on as a passion.

I mean, probably better off like, you know, providing housing for like a triple net lease type scenario for an organization that does it well. That could be better.

[Jim Boad]
Oh, it’d be great. And I actually with what I do, too, is I work, I kind of have two avatars for my coaching stuff that I do, because the majority of people that want to open so open sober living homes have been touched by it. But they might not have the resources or even the education to be able to really do it.

They’re not a savvy investor. And most savvy investors don’t really want to run these because you got to get to about three homes before you really can comfortably pay someone to run them for you. So, you know, just on an average of four bedrooms, like, you know, they math out and they make, they make great money.

I mean, three homes can replace a six figure income. Right. But like, but to really make a math out, you need to be there.

So I also helped conduit with, you know, operators and investors, you know, like, Hey, I can get you a little above market rent for your home. They’re going to take care of all these things. And this is what they’re going to do there.

So it can be a really good marriage. If you’re just an investor who like, Hey, I just want an operator to come in here and run this.

[Mattias]
And sure. Okay. That’s cool.

What about zoning? Like, is that do you have to get any kind of special use permits or anything like that for having that many people unrelated living together?

[Jim Boad]
You don’t because addiction is classified as a disability. So you run into ADA and like, it’s been upheld pretty much everywhere. There was a over in Illinois, there was a case that it was an older one.

It started in 2019 and it settled, I think in 24. And the city was just saying, no, we don’t accept this. And we don’t accept that that’s a disability of that kind.

They ended up having to pay $800,000 to the operator of that property. Wow. Now it took three years, but like, there’s a lot of case law on this now in a lot of different States, Washington has multiple case laws on this because that’s exactly what the city said.

Like my city, more than 500 related people aren’t allowed to live in a home together, but you can’t discriminate against people with a disability. So that’s kind of the workaround with this and most places getting keyed onto it.

[Mattias]
But is that something you have to educate the community on? Like, do you go to the city first and be like, Hey, look, this is what I’m doing. This is why it’s legal.

I just want, I don’t want any future problems, but just so you know, I definitely show people how to do that.

[Jim Boad]
And once like, once you talk with them, cause I mean, I’ve just had a guy in Texas, same thing at a fourplex and he got hit by the city. They’re like, this is a legal use of this fourplex. You can’t do this.

I sent him a bunch of the case law on it. He took it all into the city. He got an apology letter from the city about two weeks later and said, good luck with your home.

Like, there’s a few States where there’s, there are some other restrictions where like you do have to have a certified person that works with you, but it’s tough because it’s almost a money grab. There’s people now that just have that certification that like pay me a thousand dollars a month for each home that you have. And I’ll be that person for all of your homes and they’re running 30 homes, you know, and just because they got that hundred hour certification and you know, as some places have like, you have to be 600 feet away from another home of this type.

So like I couldn’t have two houses right next to each other that I bought and make them both sober living homes. That’s only a handful of States.

[Mattias]
Okay. Yeah, no, I mean, our, our town, I’m not in a big area either as a university town. And so I think we have a lot of zoning.

That’s just kind of like trying to limit the student housing sprawl. So most of our zoning is like two unrelated people. I have to max.

So it’s very limited, but it sounds like that wouldn’t be something that they could enforce then with this model.

[Jim Boad]
Yeah. I would be surprised if they really could enforce that with, with this model, just because of what they’re going up against. And like I said, there’s all there’s actually, there’s a dozen plus cases now that have went through this process in one.

[Mattias]
Okay. Yeah, that’s awesome. Man.

Well, that this has been fun. Like, I feel like there’s so much more knowledge you would be able to share about all the other types of investing as well, but it was a really good conversation, more focused on the sober living model. I do want to move it into the golden nugget phase.

Like, do you have any golden nuggets prepared for us?

[Jim Boad]
Absolutely. The biggest golden nugget that I try to impart on everyone is about imperfect action. It’s just, it’s taking some level of imperfect action, you know, whatever, whatever that is, everybody wants to have a plan and everybody wants everything to be perfect.

And it’s going to be next week, next month, next year, and 25 years can slip away like that. I’ve been, I’ve been trying to give back the way that I’m given back now for 20 plus years. And it’s just the next deal came up, the next issue came up, the next big thing came up.

And I just didn’t take any of the imperfect action. I’ll get to it later. And, you know, whether it’s, it’s, whether it’s getting on a course with somebody, whether it’s buying a book, you know, whatever that imperfect action is, just jump, take some action, and it’s gonna snowball into something great if you keep after it.

[Mattias]
A hundred percent. I agree so much. I think Zig Ziglar has a really good line about the way for all the lights to turn green on the path to what your destination or whatever, you’ll never leave.

So it’s, it’s, it’s very true. And I think, you know, a lot of people have analysis paralysis as far as, you know, looking at all the different things that they could do. You know, if you have this model as an, as an example of something you want to take on, it may not be the first thing you can do in an investing space.

You know, that might be too, too lofty of a goal. Maybe, I don’t know, unless you first, you know, maybe buy the house that could become that and live in it as your primary and then move out could be a way. I mean, and you’ve talked about the operators being an operator as opposed to an owner as well.

But, you know, you can get to that place. And I think the point is, like, taking action and moving towards where you want to be instead of just thinking about it or whatever, just putting on the backburner.

[Jim Boad]
Absolutely. Well, you can actually get to that place really quick. You 100% can rent homes and do this.

I’ve got a guy in two towns over that I communicate. We do a mastermind together. He has 24 sober living homes.

Doesn’t own one of them. Okay. Single one of them.

Arbitrage. Yeah. The guy’s cashflow and like a king though, like the cashflow that this guy has is insane.

Like he doesn’t have property taxes.

[Mattias]
He doesn’t have, you know, so that’s like, like going to an investor and arbitrage and right, like signing a lease and then having, putting that facility in kind of like the Airbnb arbitrage model.

[Jim Boad]
Very similar. And it’s, it’s very doable. And once you know how to explain this to an investor, you get an investor, he is going to go or she, they’re going to go out of their way to buy you more homes because I’ve got another lady that she’s on her fourth home, same investor.

He actually came into my town, walked my properties with me. I showed him what I was doing. He kind of followed my model and he’s, he’s on his fourth home with her now.

[Mattias]
There you go. Yeah, that’s awesome. Cool.

And then, and then, you know, you start building up cashflow from that and you can start maybe buying your own as well. That’s, that’s the goal.

[Jim Boad]
Unless it’s not your goal. Like one dude doesn’t want to buy, he doesn’t want to own any houses. He’s very happy.

[Mattias]
Well, so to me, I think like I would, I would advise people, I mean, do what you want to do, follow your goals. Like if you’re taking action, good for you. But I think there’s two buckets, earned income and the wealth building investments.

And I think that’s where it would be nice to have both. But if something dried up, some reason that this stopped working for whatever reason, then you would have houses you could sell if you did that one, which hopefully it never does. So this is obviously a need.

Any other golden nuggets?

[Jim Boad]
You know, I would say that’s my, that’s really my biggest one for people. I feel like that, that solves almost all problems.

[Mattias]
No, it’s a great one. What about a book, a fundamental book you think everybody should read or one that you’re currently really enjoying? Well, it’s three books.

Sure.

[Jim Boad]
Voucher Moseys. His hundred million dollar leads, hundred million dollar offers, and hundred million dollar money models. I don’t care what business you’re in, you’re in sales.

Like I don’t care what you’re doing. You’ve got to sell something somewhere sometimes. And getting in his mindset, like it’s just his simplicity of breaking these insanely complicated things down have changed my life because I followed so many people that make this so hard.

And he’s just like, you know, sad person. You have something that makes them happy. They pay you.

Now you’re both happy. I mean, it’s just like, oh, that makes sense.

[Mattias]
He’s, he’s brilliant. His whole like, that it was for the hundred million dollar model, like launched that he like won whatever he like had the most book sales ever. And like the, the, the layers of that whole thing for him was just absolutely mind blowing.

And it’s like, you’re, you don’t, I mean, you almost feel like you’re being manipulated, but he’s telling you exactly what he’s doing and teaching it that it doesn’t, you know what I’m, you know what I’m saying? Like, it was absolutely insane. Like, you know, like he, he’s like, yeah, we put in like $30,000 for ads.

And then we, we pre-sold things that, you know, from those ads. And there was also backhanded, like, you know, getting people to this event. So like, we got free advertising for that because we just rolled everything in that we earned from the pre-sales back into the next day of marketing, which gave us more free marketing for this event.

And like, it just, he just went through it all. And I was like, that guy, how did you like write that playbook? Like, do you just like sit in a room for like, you know, I don’t know, four months to just like think about every little thing you could do?

It’s crazy.

[Jim Boad]
And I’m butchering it, but I know somebody said something about like real genius is making very complicated things look simple, not making simple things look complicated. And he just simplifies it to where like, I mean, I’m not a highly educated guy. I’ve been reading a lot lately, but like, I mean, if I wasn’t a wrestler, I wouldn’t have graduated high school.

But just I can take what he says and imperfectly implement it so easily.

[Mattias]
So no, absolutely.

[Jim Boad]
Running leads is tough. And I have definitely just burned money running leads.

[Mattias]
But yeah, yeah, those those are great. I don’t I haven’t actually read the hundred million dollar model yet. But I that’s definitely one I’m going to keep going through because yeah, he’s he’s fantastic.

And such a Yeah, this is fun to hear. He could he could just talk about anything. I think he would make it interesting.

[Jim Boad]
Yeah, I think I watched him eat lunch the other day while he was giving a thing. And I’m like, I was disgusted. And my mind was blown that I stuck with it.

I’m like, you’re eating Chipotle like what are we doing?

[Mattias]
And so those are your three books, right? Like the threes of this of that series?

[Jim Boad]
Yes, because I mean, I couldn’t tell you one of them with you got to read them all. They should just be one book. I mean, in my in my opinion, it’s that should just be a book and they should be different chapters in the book.

But yeah, sure. I just wanted to make sure I wasn’t skipping over. I read multiple at a time.

I’m also reading Psycho Cybernetics. But like, yeah, it’s actually just had somebody recommend that yesterday. Amazing book.

Not for everybody, though. Yeah, but but this one, the money models, they’re for everybody. I don’t care what you do.

You should read those.

[Mattias]
Okay, Jim. And then if somebody is interested in learning more about this sober living model, following you on social media, anything like that, where can they find you?

[Jim Boad]
Yeah, I’m on pretty much every social media, Jim Boad, and then JimBoad.com is my main site. That’s where you can go sign up and get a 15 minute call with me where we’ll get on kind of talk about tactics of this, see if it’s a good fit for you. Because maybe you fit that operator bucket, or maybe you fit that investor bucket.

And either one works. And I can I can kind of be the conduit between operators and investors.

[Mattias]
Sure. And I’d usually just wrap it up here, but I had an idea, like how an agent could, you know, connect operator and investor. And that would be a great model for them, too, because they could, you know, get repeat business from their, their clients, these people that are running these things, or that are buying these things, having great success in this model. So that’s a great angle there as well.

[Jim Boad]
You’re putting more work on me, because now I got something else I got to do. But that is a great thought.

[Mattias]
Yeah. Well, hey, thanks so much for being on the show. It’s obvious that you care deeply about this and about the people you’re serving.

So thank you for what you’re doing. And thank you for teaching more people to to help help the people in need.

[Jim Boad]
Thanks for having me on.

I appreciate it. I love to share it.

[Erica]
Thanks for listening to the REI Agent.

[Mattias]
If you enjoyed this episode, hit subscribe to catch new shows every week.

[Erica]
Visit REIAgent.com for more content.

[Mattias]
Until next time, keep building the life you want.

[Erica]
All content in this show is not investment advice or mental health therapy. It is intended for entertainment purposes only.