Greg Owens 25:20
I love I love rules when they kind of backfire.
Rick Boyce 25:23
Yeah, yeah. So um, now the the new laws that went into effect in California, January 2020, are going to be revisited before January first 2025. So in a way, this is a bit of a kind of live experiment in the wild. And there may be some adaptations before we go to 2025. And so some of these things will probably be revisited. Right. And so we’ll just we’ll just have to see. But as it stands now, most of what was originally written into these adu laws has held up and is the law of the land for the most part.
Greg Owens 26:03
Oh, man, it’s got me thinking for sure.
Rick Boyce 26:06
Yeah, definitely.
Greg Owens 26:07
Yeah. Go ahead, Katrina.
Katrina Stephenson 26:10
Oh, I was just saying, um, my husband and I are probably going to buy in the next year. Want a large yard like that to be able to put an in law unit in the back? Yeah. Like, do you have a hot? How does it work when you send someone out to see the property or see see kind of where we’re at? And if it can withstand at?
Rick Boyce 26:30
Yeah, that’s a really good question. I’m actually looking at a property in Nevada this afternoon with the same potential. So you’re absolutely right. Katrina, a lot of a lot of I would say kind of savvier kind of real estate buyers now are thinking about adu potential. And they’re, they’re including that in their calculus as they’re evaluating properties. And, by the way, at us are allowed on single family as well as multifamily properties. And on multifamily, the laws are even more generous. And we can talk about that in a second. But the on your use case of wanting to buy a home that has an ad friendly yard, that’s what we just call I usually use that terminology. And, you know, many are not, but many are. So what we offer as as part of our service is if a customer wants us to give our viewpoint on a property that they’re considering, we’re certainly happy to kind of share our point of view in terms of what’s possible. And, you know, usually that’s going to be framed through, you know, our own limitations. So for example, because we’re all prefab our units arrive in huge sections, oftentimes, we need to use cranes to lift them onto the foundations and things like that. So, so we have some logistical requirements that maybe that, you know, a stick builder would have, for example, so even if even if we couldn’t build an ad for you, it doesn’t mean that someone else couldn’t using different techniques.
Greg Owens 27:54
And for those of you that don’t know, a stick builder is sort of the old style carpenter that builds on site. Contractor. Yeah, yeah. There’s, there’s options there. But you guys need to have a crane access. Yeah, you have to make sure that there’s no wires in the way that you can put a big crane that can like lift something out and over? Yeah,
Rick Boyce 28:15
yeah, we need either a driveway that’s about 15 feet wide, or so which is that’s fairly wide for a driveway to pass through. Or we need to use a crane, the main thing to look out for with cranes is we can’t lift over electrical wires. And like the wire that runs from the pole to your house, that’s not a big deal that can be dropped by an electrician and reattached later. But what I’m referring to is the neighborhood service lines that run down your street, and cannot lift over those. So that so the rule of thumb on that is if the if the power poles are on your side of the street, we’re definitely not going to be able to lift over them. So you want to select the property that has the power poles on the opposite side of the street. If you ever want to think about craning something in your backyard, yeah, that’s a good little tip.
Greg Owens 29:02
Yes, things to look out for Katrina. When you’re looking you’re like, oh, this side of the street matters a lot. Yeah, you’re like, No, this is on the wrong side of the street, right? Yeah. Or, you know, like incident rules out you’re not doing a whole lot of those kinds of homes here in mo Valley. But Nevado makes it a lot easier because he’s here I’m in Selma not there’s a little bit challenge. It can be challenging and can be okay. In certain sections of
Rick Boyce 29:25
sentence Elmo Sleepy Hollow is pretty
Greg Owens 29:27
flat, pretty flat, and they buried all the wires by their
Rick Boyce 29:31
wires. So that’s Yes, that’s good. And, yeah, Mill Valley. I’ve looked at a lot of properties in Noe Valley. It’s tricky, for sure. And although you know, I mentioned a moment ago, multifamily properties. This is actually a good opportunity to talk about this. Yeah, you have a we do have a customer we’re working with in Mill Valley, who has a duplex and on multifamily parcels regardless of the number of units so two or 200 or 200 or more whatever it is, you can add to detached ad use. So in this, on this particular duplex, we’re looking at adding to ad use in the backyard school, in effect, turn it into a four unit rental property.
Greg Owens 30:10
Damn, that’s amazing. And and no requirements for like low income or something like that it’s, it’s straight up like no, we build two more units that’s done that opens up a whole world for investors, right? Because I can then because I’m actually like, look, I’m casually sort of looking for another property to invest in. And that makes you think about it like, oh, this has got a back lot that’s not being used, this would be a perfect place to add more value to this property. And you can legally do so and you don’t have to put the parking it sounds like right for the multi units right, as long as it’s within that half half, half mile to the busing.
Rick Boyce 30:47
And usually multifamily is fairly close, you know, the zonings, usually fairly close to transit. So that usually works out pretty well. Yeah,
Greg Owens 30:54
no, this is great. This is Yeah, yeah. What is that? Is that the same for commercial properties? Or is it is there any?
Rick Boyce 31:03
Do you mean commercial, multifamily or commercial? Some other usage
Greg Owens 31:05
just commercial like light industrial, that kind of thing? No, the?
Rick Boyce 31:10
So that’s it? That’s an interesting question. The the ADU laws right now are only designed with residential properties in mind. And one of the things that that we think is gonna happen, or at least I think so I’ll say this is my personal view. But I think one of the things that will be updated when they revisit this in 2025, will there will be other types of properties that will be allowed to add at us? And specifically, I mentioned earlier NIMBY, not in my backyard. Well, there’s there’s a movement right now call yimby? Or let’s see what is it’s, it’s up? Yes, in God’s backyard. So churches, churches, often own large piece of real estate, right. And a lot of churches have really, really big parking lots and so forth. And so I think that my prediction is that that come 2025 that churches will likely in church property will likely be included in this so that they can add a to use also,
Greg Owens 32:12
that makes a lot of sense for churches, because then a lot of those parking lots are empty, and sometimes they have they have good chunks of land that are it’s just going in you.
Rick Boyce 32:21
Yeah, and providing housing is generally very consistent with the values of the church. And so there’s a lot of things there that kind of lead me to believe that I think that is a possibility. But there might be other types of real estate too, that, you know, we just haven’t spent a lot of time thinking about, we’ve only thought about churches, because we get a lot of phone calls from churches asking if we can help them add ideas for their staff for a lot of churches, particularly in northern California, in more fluid communities, they really want to bring in workforce housing, they want places for their teachers, the firemen, etc, you know, to be able to afford to live. So I think churches are going to be maybe an important part of this. In the not too distant future, too.
Greg Owens 33:03
And phenomenal timing on the law change. 20 it just all went into effect. 2020 Correct. Correct. Just right before COVID Like people are sitting around their homes going like, oh, wait, we could build, we could build an ADU back here, let’s talk to an arc, you guys must be going gangbusters this Yeah,
Rick Boyce 33:21
may have demand that demand is high. And I can tell you to I mean, related, that really changed our business model before. Before COVID All of our sales efforts were, you know, go to somebody’s house, you know, sit down with them at the kitchen table, kind of show him books and plans, and maybe a PowerPoint, since COVID is kind of 100% virtual and so, you know, we’re selling, you know, a very expensive product 100% through meetings like this, you know, virtual Oh, man, your phone calls or Zoom meetings or whatever. And it works, you know, I think it’s, you know, our prices started 199 For 450, you know, up to 309 for 1200. So, these are, these are expensive products, but we’re actually having people you know, purchase them in some cases without needing us personally in the process just due to the you know, the pandemic and those limitations.
Greg Owens 34:17
And what Wait, they’re not even walking through it.
Rick Boyce 34:21
Some aren’t, we do have models that are available, but some people are just virtual,
Greg Owens 34:25
do a virtual tour or like, I want that one in the background. I want to do this, this and this and then go down. Wow. And
Rick Boyce 34:32
we do and we do have virtual tour, you know, you can get a pretty good idea of things. From you know, the the virtual tools and the tours. We do have a model unit available in Santa Rosa. That’s a 1200 square foot that’s available for people to visit if they would like and we’ll be adding more throughout the Bay area as well.
Greg Owens 34:50
Right how man this is great. Well, there’s there’s so much potential and so many possibilities and I love I love what you said to that so that that They’re gonna revisit the law in 2025. So they might make it make it more restricted in some ways they might add the parking element, depending on what’s happening in each. As far as like, constituents goes, right, and people lobbying to make some changes to it,
Rick Boyce 35:14
I think yeah, I think that if, if anything, I think it will become less restrictive, not more restrictive. And the reason I mentioned and the reason I say that is, there was another law recently recently signed that will go into effect January one, Senate Bill nine. And that relates to the ability of any California homeowner theoretically, again, this hasn’t been fully determined how this works yet, but to subdivide their property. And so right now, the way it works with excels accessory dwelling units is the the dwelling unit itself cannot be separately deeded, it’s a part of the primary property. So you can’t finance them independently. You can’t sell them independently. You can’t title them independently. They’re all part of the bigger property. What Senate Bill nine, which was just signed by the governor says is that property owners in California can subdivide their property and in some cases, up to four different AP ends. With a parcel number, what
Greg Owens 36:19
you’re saying is they’ve made it easier to almost create, like townhouse or condo situation where you’re cutting up a property and a person can own that back. Correct 50 by 50 foot section with the ADU on it. And then there’s some probably some easements or something like that for parking or whatever they work out between between the two parcels, then,
Rick Boyce 36:43
yeah, no, you’re right. So that, in essence becomes a small condo. And the Senate Bill nine in the fact that this just passed, I think it was three or four weeks ago, super recent, but that passing leads me to believe that things will go towards greater, you know, leniency if you will, towards making, you know, housing more accessible and more affordable. I mean, this is really driven by the fact that housing in California is not affordable, and there’s not enough of it, and the state wants to see that address. So
Greg Owens 37:16
what about like so ring County? I haven’t heard this this year at all, but I really don’t listen to watch the news. So I don’t always know. But we’ve been in a drought this whole year, right and in a really bad drought. And that you know, I know that they for a while they were using the the water hookups and water as a way to stop construction. But it sounds like they can’t even use that as a as an excuse to slow down construction. In particular, yeah, VA to us because it’s like no, that’s not even like looked at in a way.
Rick Boyce 37:49
Yeah, they I mean, they have they can’t but on the other hand, we all know the realities of I mean, there’s obviously a finite supply of water so I’m not I’m not quite sure how those two things are ultimately going to get resolved. So far. I have not heard of that blocking any of our projects although it certainly occurred to me to I mean the the housing needs in Marin County are significant and you know how we provide water to all those houses you know, I’m not I’m not sure how that all gets worked out. But with at us right now the way the way it works typically is it will be connected to the water supply of the main dwelling and also the sewer lateral of the main dwelling. So there’s huge economies of leveraging the infrastructure that’s already there. And and that was that was designed into these ADU laws again, to make it more affordable. So separate hookups. And other fees related to hooking up aren’t required typically. Which makes makes it a more more cost efficient way to build obviously,
Greg Owens 38:49
does it change the status of the house? Like because though, if you build an ADU is it become it becomes more like an estate property then? In a lot of ways? Yeah. Right. And so now when you increase the property taxes, so that’s good for the city, too.
Rick Boyce 39:03
Yeah. Medically? Yeah, we’re there’s definitely improvements. So the the property taxes get treated just like they are with any remodel project. So it doesn’t reassess the whole property. But after you break ground, and of course, it’s all permitted, the county will reach out and ask you about the value of the end. So you’ll be self reporting on the value of the improvements that you made. And so that will affect your your taxes, in terms of different kind of different real estate classifications. What we have seen in the multifamily world is that when a like let’s say a four Plex adds to detached ad use in the world right now of real estate, one to four units is all considered residential and five plus is considered commercial. And the distinctions matter primarily as it relates to financing so different types of financing is used for different classification. But if a four Plex was it, which isn’t considered residential adds to detached ad use for even one. So it goes to five or six units, that will be reclassified as a from a from a financing perspective anyway as a as a commercial multifamily property.
Greg Owens 40:14
Right, right. Yeah. And I was asking about commercial properties, because we own some property up in, in the canal canal area, and it would be great to build an ADU on the back of that property, right, and have and have housing for employees or somebody that’s around there all the time. And that kind of thing.
Rick Boyce 40:31
Yeah, it’s a great, it’s a great way to go on the, for investment properties, what I typically see and we run the numbers, you know, for all of these projects, but typically investors are buying cash flow at about a 50% discount, versus if they would have bought it otherwise. So in other words, if we had to 1200 square foot at us to a to a apartment, but say, the cost of that is typically going to be about half if not less than half of buying, you know, 2400 square foot duplex on the open market. And so you’re buying, you’re getting great returns and, and you’re buying at a deep discount, because you already own the land like that’s it’s as simple as that. It’s like, you know, on a typical real estate deal, the lands about half the price, so you already own the land, this gives you an opportunity to actually monetize that land. We’re currently it’s just a, it’s just a liability, because you’re paying the landscape it and water it and whatever. But you can turn it into revenue generating, which is which is really exciting.
Greg Owens 41:34
Right? And it’s making me think about just the different multifamily houses that I’ve looked at now. Because now it’s like, Whoa, you got more greater potential here of upside. If you just go through some of this like reconstruction, what does it come to per square foot when you guys at the end of the day?
Rick Boyce 41:51
Yeah, it depends by unit size. So the smaller ones, of course, are more more expensive on the per square foot, the bigger ones are less. So the bigger units are in the mid to hundreds per square foot. And the smaller ones are probably pi 300. So for hundreds is that including foundation. Yeah, that includes everything Foundation’s permits. That’s that’s in transportation. That’s
Greg Owens 42:12
insanely cheap for Marinoni here, like our Northern California and so many ways. Yeah,
Rick Boyce 42:17
super affordable. So it includes Yep, permits, pretty much all in it doesn’t include cranes needed, it does not include the crane. Right? And, you know, sometimes there’s utility upgrades. So I’d say utility infrastructure and upgrades is an area where where we can have added costs,
Greg Owens 42:34
so like the lateral sewer might need to be completely replaced, because it can’t handle the new load corrective thing forever, or it’s so far behind the house that you got to run water to it, it’s going to be trenching, and that kind of stuff, and that kind
Rick Boyce 42:47
of stuff, exactly, that kind of that kind of stuff. So those are the things that can that can drive up the cost. But the nice thing about prefab construction is that, you know, the the project costs overall are so much more controlled. And you as the investor have so much more control over the project. You know, we’ve all had the construction project where the budget just spirals bad, you know, and it does not tend to happen on these projects, because so much of it is controlled from the very outset.
Greg Owens 43:14
Oh, man, go ahead, Katrina.
Katrina Stephenson 43:17
It’s such a burning question. And I just need i What are your thoughts on the shipping container homes that are converted from shipping containers? Are they comparable to the 80s
Rick Boyce 43:31
fair, I think they’re really cool. I think that they’re probably more expensive than what we build they could be at us. So shipping, standard shipping containers 40 by eight, so 320 square feet. So you could certainly make a single ADU out of one shipping container you could add to to get the 640 square feet etc. So you could put quite a few together and stable that 1200 square foot or the 800 square foot Mac’s
Katrina Stephenson 43:56
big stack them maybe yeah, there’s
Rick Boyce 43:59
companies are doing really cool things with shipping containers for sure. I’m a big fan of of those. I’ve even seen a couple of eight by 14 Cut in half and kind of made into little Casitas you know with a sliding glass door big slider across the
Greg Owens 44:13
opening. And I just saw that a house in Greenbrae where they built one to make it the workout room and off, you know, office not really an ADU but really sort of a really plush office with some glass on the side for the workout room and in an area that’s like really nicely lit for the office, you know, so that the husband can he can have like his like man cave away from the main house, right?
Rick Boyce 44:39
Yeah, no, I think they’re great. They’re sturdy. I’ve heard the price of shipping containers has gone up quite a bit but they’re still they’re still fairly cheap.
Greg Owens 44:47
Yeah, shipping in general is going crazy on me. And so end is what there’s so many delays in everything right now.
Rick Boyce 44:56
Yeah, for sure. For sure. But yeah, I love shipping containers. There’s a company called indeed, well, they’re out of Boise, Idaho, indeed, well, and they build, they build shipping container multifamily. So their focus is using the shipping container to help them build affordable housing. And particularly with a focus on large multifamily. So, you know, they they’re putting together hundreds of them to make a apartment building pretty interesting.
Greg Owens 45:24
And then what do you have you guys researched the or, or looked at the the 3d printed ad use? Because I get where they’re doing it with concrete and other types of? I’ve seen it I’ve seen a little bit a little clips of it. I’m like, Whoa, that’s, that’s amazing. But any any thoughts on that? Or what you’ve explored in that area?
Rick Boyce 45:44
We think, yeah, we think that’s definitely going to be part of the future. I don’t I don’t know that. We’ve put that on our roadmap yet. But I mean, eventually, I would say, if we look at a long term trajectory, that will probably be something we take a close look at in the future. I think it’s a neat technology. The ones I’ve seen, obviously, the 3d printer itself is enormous, enormous, basically,
Greg Owens 46:05
a massive crane and yeah, controlled by a computer that moves concrete around
Rick Boyce 46:10
concrete into forms, as fascinated by the fact at least the one I saw all the corners were rounded, there were no square corners, as Yeah. So I think that I listen, I think the the number one theme in real estate right now is affordable housing, and anything that can help make that a reality and eliminate some of the some of the costs that creates the prices to be so high is going to be helpful. So I think, I think that’s going to be part of it, it’s gonna be a lot of things, I think, that are going to help us actually deliver on that objective,
Greg Owens 46:39
I keep, I keep wondering, when we’re gonna have like, drones doing painting, right, I can see it right, I can, in my mind, I can see that, like the drones could could you can program um, to like, pick up a little bit of paint go up to a point and paint this one little like two by two square. But then, like having hundreds of drones flying up and down and doing that all day long, right?
Rick Boyce 47:00
Oh, that’s fabulous idea.
Greg Owens 47:03
I think it’s crazy money right now. But you know that as those costs go down, and as the programming goes up, and as labour keeps going up, these things will start to start to change. And, and that’s going to be true with in five years when it comes to autonomous cars, right, because I was mentioning, we’ve done some work for some of the autonomous autonomous car companies here in San Francisco. And you know, they’re fast, they’re at a fast pace, trying to replace drivers. And that also helps you you don’t need all these cities won’t need as much cars, because you just order a car and have it come pick you up. Right, right.
Rick Boyce 47:39
Yeah. And I think that’s one of the one that’s a reality, for sure. And we’re going that direction. And I think that helps. In the case of ad use, where parking has been eliminated. I think that helps us all probably get a little more comfortable with that. Right. Hopefully, we’ll have more of an on demand car infrastructure in the future.
Greg Owens 47:56
Yeah, that’s, it’s so awesome. Rick, I want to find out more about you and how you’re very passionate about this. You know, your stuff. It’s been unbelievably great to highlight this part of the construction in the laws and that kind of thing. How did you how did you get to this place in time?
Rick Boyce 48:13
Yeah, well, we I’m a real estate investor as well and have been investing in apartment buildings and mobile home parks since the early 2000s. But we had done something new on the real estate investing side with some friends and we purchased a parcel in Sonoma, and this is in Sonoma County, but it’s wine country, six acre parcel really nice. And our vision was that we would add a to use up there to give us a place to a place to live and hang out. And the main home is a vacation rental. So the idea would be keep the vacation rental going and then we’ll just have a little little houses that we can, you know, visit from time to time. And so I started researching the industry and I literally called 12 Different prefab home builders, you know, all over the West Coast, you know, Washington, Oregon, certainly California, and Utah, Idaho, too. So the western US is really big for manufactured housing and kind of the closer you get to where the timbers located is where you’re going to tend to find more factories. So Oregon and Idaho have a lot of factories or Washington a little bit less so. But I spoke to so many prefab builders and what I found was that none of them really we’re full service completely turnkey. In other words, they say yeah, we’d love to sell you the ad use and we’ll truck them down. We’ll drop them off in your driveway. And I was like wow, well, that leaves the hard part for me. You know, like I That’s the easy part. Like the hard part is the permitting the foundation, utility connections on and on and on. In our case, we have a septic tank as well. So that adds additional complications, right. And so I found Villa Homes and started talking with them about their product in lo and behold, they’re just completely turnkey, they do it all the hard stuff. You know, most importantly, the permitting and, you know, helping with the septic, all of that stuff. And so I said great this year exactly who we want to, we want to work with because it’s costless. In any, any construction projects complicated, adding at use is complicated. I’m not an expert on that. So, so I was really excited about the company and the fact that they were turnkey. So we engage them to help with our project in Sonoma. And, and then they shortly thereafter, I learned they had a job over. So I applied to join their team to help them sell ad use and grow their business. So I joined about a year and a half ago, and I’ve been on the sales side. Since then, and just to give you a sense of the volume, like in the last, my first 12 months with the company, you know, I was able to sell 75 at us, so just give you a sense of the demand and the volume. So that’s just, you know, and we have other salespeople, too, that just happened to be, you know, the, the projects that I was focused on, but the demands definitely, definitely there, you know, in a big, big way. And yeah, we’ve now put our project and Sonoma on hold just for now, because we want to understand the implicate implications rather, of Senate Bill nine, which I mentioned earlier, which is the potential ability to subdivide lots. And we need to understand how that’s going to be interpreted in Sonoma County, because that might create yet different and more interesting opportunities and even adding a to use. So we’ll just have to,
Greg Owens 51:39
that makes sense. Because you got you said you have six acres, there’s one property on it, you’re looking at it like, Okay, what’s the highest and best use value of this? We were just gonna, you were thinking just put some ad use on it. But now it’s like, oh, wait, we need to be a little bit more strategic. Are we going to split some of these off? Yeah. Are we going to just make it so we can split all of them off? That means the location of each ad, you has to be thought out then?
Rick Boyce 52:02
Yeah, definitely. And I think too, this is one of the things it’s gonna be very interesting about Senate Bill nine to see how it works out because Sonoma County, Napa County, parts of Marin put a huge value and a premium on their kind of rural and country nature, you know, that. And the people that live there don’t want that to change. I mean, I don’t want that to change. And so that’s, that’s what we’re going to have to kind of wait and see how the local jurisdictions choose to work within the state guidelines. Because it’s not right, like every community shouldn’t, you know, you know, be subdividing lots and adding massive density, you know, it’s just not the, that’s not what the they’re looking for in Sonoma County. So, so we’re curious to see where it all goes. And I think there’s a lot of to be determined in that particular area. And then
Greg Owens 52:53
like, there’s a blinking on what it is they own horse hill over here in Mill Valley. There’s a, you know, there’s a group that nonprofit that buys up farmland and different things to it can’t be developed. Right, right. Right. And they’re there. They’re in Sonoma, they’re here in Marin, they’re, they’re buying it up, which that’s, that’s a great alternative way, right? Because, you know, you as the owner of the property wants to maximize your investment in the property, right, and so maximizing it might be dividing it up, but the whole neighborhood might not, and giving the neighborhood that opportunity to buy the property, at the same value is a good I think, is a great sort of way of doing it. But then I also see how the cities get involved too, and be like, Hey, we don’t want to, we don’t want that many houses breaking off this nice farmland we’ve had for multiple generations, right?
Rick Boyce 53:44
Yep. So that’s where you get back then. So it always in the circles back to the end ism, or the nimbyism? Not in my backyard or yes, in my backyard. Right. And yeah, it’s it’s, it’s these are not easy, easy problems to, to sort out, but the state’s certainly trying and, and, you know, that’s why they’re pushing these laws out. And, you know, in a lot of cases, we’re just gonna have to wait and see what happens at the local level. Because the laws say they see, I mean, the laws, some of them seem, I mean, they’re pretty radical, actually. And so we’re just gonna have to see what happens.
Greg Owens 54:18
That’s great. And then how did you get your start in investing in real estate? Like where did this this this come you don’t just jump right in and start investing in real estate for most people?
Rick Boyce 54:28
Yeah, I really. So about 20 years ago, I decided I wanted to invest in real estate and have greater independence at some point in my life through you know, passive cash flow. So it’s kind of that whole, you know, anything. So I read I gotta say, though, I read Rich Dad, Poor Dad by Robert Kiyosaki. And I just thought it was an amazing, it’s so great. So, so simple, and so straightforward. And I just thought, Okay, well, you know, stop being a dummy, you know, do it do what he says in the book. And so I started buying buying properties. The the first property I bought was a four Plex in the canal and Sandra fell. And that was, and I was self managing that and that was my first lesson in the I don’t want to ever self manage the property again, it’s just a lot, you know, stuff breaks and it always breaks on a weekend. I mean, you guys you guys know and so. So at that point I decide, okay, I’m never going to buy anything small that needs to be self managed again. And one of the things that Robert Kiyosaki talked a lot about too, is getting properties that are large enough that can fund a property management company and on site and all this stuff. And so I started going a little bigger. And that was really helpful for me, and because I did not want to be hands on, and a lot of what I acquired was outside of California for that very reason. In other words, buying scale in California’s is hard because it’s really expensive. So I would go to Oregon, Nevada, Colorado, places like that to find scaled properties affordably. And, and kind of started started that way. And, you know, the, you know, the whole wet and you know, thankfully, you know, everything’s done pretty well. I mean, in real estate, you know, it’s like baseball, like you can hit a base hit every time and I certainly had a lot of strikeouts. But you know, the batting average is still you know, is still good, respectable. So I’m happy with that. And a lot of those Western markets have seen lots of appreciation as well, Colorado, Utah, Oregon, and so forth.
Greg Owens 56:24
Especially in the last 10 to 15 years. So many Californians moving out of California.
Rick Boyce 56:30
Yeah, that’s the driver. Yeah, we’re Yeah, they don’t love Californians in any of those places. I can tell you that. Yeah, no, no, I know. Yeah. We’re trying not to mention that I’m from California, right.
Greg Owens 56:39
They arise.
Rick Boyce 56:41
Like, oh, no, another one. Um, but But yeah, and then now I’m, I’m doing less I want to start. I do think that I do think the real theme in real estate investing right now is around affordable housing, as I said, and I think finding any way to leverage that. So I think properties that can accommodate an adu are probably a great buy multifamily properties, in particular that can add at use are Yet Yet even a better buy. If you can find a duplex or a four Plex or whatever, and you can add a couple that’s a big, that’s a big value add. I think you know, and, you know, I’ve talked to a lot of investors now that are looking at kind of CO living type. And this is particularly big in the Bay Area. I mean, all of these are affordable living strategies, like people are just trying to figure out how can we just make it more affordable for people to live in a nice place. And so I think anything related to affordable if you’ve got a game plan, and a strategy that can work is a good place to play right now. So I’m actually whereas previously I was kind of thinking bigger and scale now I’m thinking kind of smaller. And just trying to because I think with AD use, and particularly smaller properties is where the real leverage is.
Greg Owens 57:54
You mentioned it in your LinkedIn is, is the whole Airbnb phenomenon is there’s there’s so much tremendous upside to that. Right? I have like friends that are renting out their houses and no longer you know, they’re they’re staying in a little apartment now and their Airbnb being their main house on a regular basis, right, because it can make so much money based on end.
Rick Boyce 58:19
Yeah, yeah. Well, one of the things we didn’t talk about this yet, but as part of the ADU laws from the state at us are not eligible for short term rental. And they define that as not less than 30 days. So they are specifically disallowed from being used for a short term vacation rental.
Greg Owens 58:36
And how do they police that?
Rick Boyce 58:38
The I have no idea? I don’t think it’s possible, to be honest, but
Greg Owens 58:43
I mean, they can they can see the pictures. They mean, but somebody’s got to do all that policing, right, that person not to get paid and cities don’t have that kind of money. Yeah,
Rick Boyce 58:51
yeah, they have. Oftentimes not. I don’t think that it’s always but some jurisdictions do require a deed restriction. So you literally add a deed restriction that that ADU cannot be rented for periods less than 30 days. But what I’ve seen people do here’s I mean, the way you work it around is kind of how you described your your friends is that it’s not an uncommon that people will build an ADU particularly empty nesters that don’t need their big house anyway. Or they’ll build the ADU. They’ll move into the ADU at part time or full time they rent the big house for big money.
Greg Owens 59:23
And that’s it these guys are they moved into they bought a mobile home and moved into the mobile home on their property and then rent out the main house.
Rick Boyce 59:31
Yeah, it’s a great retirement strategy. I mean, oftentimes in cases like that the property taxes are low, the mortgage is low. You know, there’s there’s a lot of reasons to stick around and not sell it, and the ADU or some other kind of dwelling can help you execute that for sure. So we’ve seen that be a part of people’s retirement plans for sure. You know, once they’re empty nesters and they don’t need the big house any longer.
Greg Owens 59:54
Yeah, and some of these people I haven’t gotten my head wrapped around it, but they’ve done such a great job of making it all turn key to right like where you did everything super simple. The locks are like, programmable, they just show up and I’ve rented Airbnb like this where you just like, you just so seamless coming into it. It’s perfect, right? I’ve had some bad Airbnb experiences too, but for the most part, there’s been some really good ones.
Rick Boyce 1:00:22
Yeah, yeah, the keyless entry is really big for sure. Yeah.
Greg Owens 1:00:25
So you know, as we get close to closing, wrapping this up, I wanted. So if there’s young people or people wanting to transition into investing and that kind of thing, are following your path a bit? What’s your recommendations? You mentioned Rich Dad, Poor Dad, which is a great book, what other what other? What ways? Would you do that now and today, especially like Katrina, here, too. She’s She’s gobbling this up and very interested in like, oh, man, there’s so much potential and possibilities.
Rick Boyce 1:00:54
Yeah, they’re really all. It’s a great, it’s a must read. And, and there’s a lot of others. Like it, but anything that can kind of give you give you inspiration and ideas, I would say, with Rich Dad, Poor Dad specifically, do everything he says and don’t do what he says, you know, not to do. So in other words, he’s really big on, you know, be an investor, not a builder, like don’t buy some land and think you’re going to build an apartment building. You know, because you’re probably going to lose money. So, so he’s big about being an investor, not a builder. And I think a lot of us kind of, at least, and I can say, as for me, personally, we get kind of interested in the oh, maybe I should, you know, build a spec house, you know, and it’s like, okay, well, I did that. I lost money doing that. And, you know, I would never do it again, you know, it’s just if it were easy, people would do it all the time. And the fact is, it’s not easy unless you’re a pro, and you can control your costs and so forth. But so I think it is important to kind of kind of follow, follow His guidance and be an investor. But I think that it’s tougher in real estate now, because prices have been driven up so much. And so I would encourage any young person who wants to be in real estate investment to definitely be open minded to looking outside of the Bay Area, or where you live right now you have to, I think it pays to be geographically open minded. And there are and think about areas that are primed for growth. I mean, real estate appreciation is driven by job growth and population growth. And so think about areas where, you know, Reno is probably a pretty good example, you know, as soon as Tesla went in with battery factory, and all this other stuff, you know, in Reno is probably still a pretty good place to invest. And it’s still close enough to the Bay Area where so I think that that’s a, you know, something to consider and think about. But I also believe that, you know, there’s no to no time, like the present to start to, and, you know, like all investments have builds over time. And so the sooner you start the, the sooner you’re going to start to see the rewards from that. And the another thing I liked about Rich Dad, Poor Dad was, he talked a lot about, you know, find, find a deal that’s going to work for you, and figure out the money later. And I always thought that was smart. So in other words, I found a lot of great deals, just by looking for deals that I couldn’t afford on my own. So I’d bring in partners and so most of what I own, I own, you know, in partnership with other people who I brought in, I’d be like, Oh, I found this thing. It’s a great deal. I can’t swing it on my own. Would you be interested in partnering and things like that? And so I found that to be really inspiring, which is if you find the right, let the deal be the driver, not your budget, necessarily. Oh, and be open to partnerships with people and, and obviously, people you like, and trust, but, but just to be open minded, I think to that.
Katrina Stephenson 1:03:54
Are we going to say Katrina? Oh, that’s great. That’s a great piece of advice.
Greg Owens 1:03:59
Yeah. That’s good. That’s good. Yeah. Did make it make it about the deal and then sell the deal. Yeah, like that. Well, this is this has been a wonderful talk. I mean, it’s definitely opened my eyes I really loved learning these new laws that are in a pet but in fact, this is good and like it’s gonna make me look at my both my own properties and any future properties with a with a different set of eyes now because there’s so much more potential possibility, you know, with these new laws and everything like that that’s happened here. Both both of those both the ADU laws and also that you said section nine, Senate Bill nine SB nine SB nine. Yeah. So that’s, that’s wonderful, where you can like actually break up a property into multiple different properties and that’ll be easier in the future. Yeah. Is right now that’s a that’s a crazy complicated situation.
Rick Boyce 1:04:49
Yeah. Yeah, definitely. Well, if you as you’ve come across clients that are interested in in at us definitely send them our way and anyone who’s listening We’re at Villahomes.com. On the web, and, you know, you can check out all our floor plans there. You can sign up for a free no commitment assessment, we’ll assess your property. So yeah, looking, give us a look and you’ll be happy to,
Greg Owens 1:05:16
to work with you. Yeah, that sounds great. And what’s the best way to contact you? Right? Yeah,
Rick Boyce 1:05:20
email is Rick@villahomes.com. Just Rick@villahomes.com. Perfect.
Greg Owens 1:05:27
Yeah. And this is wonderful to meet you. You’re hearing said in Marin county too. So at some point, we should definitely have coffee at Phil’s or Pete’s whatever you like this guy. We were we every other Friday. This Friday. We were just at Pete’s. And in Greenbrae. Having our company safety meeting. We do it in the morning. We’re in the rain out there. It was great. Yeah, yeah. So and it’s good to have like a local on the podcast. Thank you so much for being on the on our podcast Watching Paint Dry. You’re welcome.
Outro 1:06:08
Thanks for listening to the Watching Paint Dry podcast. We’ll see you again next time and be sure to click Subscribe to get future episodes.