some people try and jump straight in and

just start making offers and analyzing

things but they don’t really know what

they’re looking for once you’ve defined

your buy box in this case the volume

game becomes okay how can I find as many

deals that fit that buy box as possible

you don’t necessarily want to just go um

scraping the internet trying to force

things into your buy box you have to

emotionally detach yourself from it and

just say that everything that meets

these parameters I’m going to analyze

and I’m going to do it consistently

welcome back to our special podcast

series The 20-minute Investor where we

bring you actionable nuggets and

insights from our real estate investing

journeys in bite-sized 20-minute

episodes i’m Aaron Amin my wife and I

built a portfolio of eight cash flowing

rentals across three states while

working full-time and raising a young

family and I’m Nathan i’m a husband

father a tech executive who built a

portfolio of cash flowing rentals across

two states from over 2,000 m away

together we co-founded the Remote Real

Estate Academy where we coach investors

on how to build their own portfolios of

cash flowing rentals from anywhere in

the world today’s episode is a fun one

we’re going to talk about how to analyze

a rental deal in five minutes or less

literally so no spreadsheets no getting

too deep in the weeds just a quick and

dirty process using free tools to know

if it’s worth a closer look so this is

actually one of the kind of core tenants

of our program is we teach people the

fundamentals of how to understand what

makes a good deal they build a buy box

and learn you know what their parameters

are to try and meet their goals but then

there’s a kind of a the middle of our

initial accelerator is largely about a

volume game of just getting analyzing

deals as much as possible you know we

say 90 deals in 90 days and then putting

offers in on the ones that make sense so

the the piece we’re going to I guess

kind of unpack is like how does one get

into that rhythm of high volume analysis

without getting too emotionally attached

so Nathan why don’t you kick it off it’s

a juicy topic as you said a lot of stuff

to say about this i think it it starts

and it all starts with focus I guess for

me at least and focus meaning as we talk

about and as we teach right but it’s

like picking a specific market and when

we say market it’s more granular than

you know city X it’s neighborhoods or

one neighborhood in city X right and not

only that it’s also focusing on the very

specific asset or property type that you

set up kind of through your buy box or

that you’re interested in I guess and

then it’s getting intimately familiar

with that neighborhood or those

neighborhoods and that type of property

and keeping that focus allows you over

time to become the expert in that

property type in those or that you know

neighborhood those neighborhoods you

know that zip code those zip codes so

that you can execute like a back of the

napkin quote unquote or cursory whatever

you want to call it you know deal

analysis in you know less than 5 minutes

I think it becomes tremendous ly hard to

do that and to do it well if you’re

looking at three different cities 10

different neighborhoods across those

three cities if you’re looking at single

family homes if you’re looking at

duplexes if you’re looking at quads and

I would say it starts with that even

before getting into tools or

spreadsheets or any other analysis you

know mechanisms or tools that you could

be using calculators whatever it is that

you could be using to do your quick

analysis i say that simply because for

example because we’re we’ve been so

focused on like the same type of

properties in the same five zip codes

for the last six or seven years now when

Zillow sends me an email and says “Hey

this new property came up for sale,” I

don’t even need to do more than just

scan the Zillow listing to see whether

or not it ballpark is something I should

spend more time on or not for example a

property listed for you know making this

one up but $300,000 in kind of the the

the zip codes and neighborhoods that we

typically look at I know right off the

bat that it will not cash flow and reach

the return goals that we are looking for

unless I got it for maybe 60 to 70% off

right which is a pretty tall order if

it’s I get five Zillow emails with five

new listings in these zip codes and you

know one of them’s $300,000 and the

others are closer to the $150 $200,000

mark or whatever I can quickly skip over

that $300,000 property and spend a bit

more time focusing on the others right

and then and then there’s more but maybe

I’ll start there i think it starts with

focus for me really focus on that one

kind of area and one property type yeah

no it’s a good point and so basically I

think kind of the quick summary of what

you’re saying is like you have to know

what you’re looking for in order to be

able to get quick enough and understand

how to view things in a quicker right if

you’re just looking at one property if

you just spin the wheel on Zillow and

scroll to some random city and pick a

random neighborhood and a random house

you’re not going to know what you’re

looking at even if you understand oh

it’s a three-bedroom two bed two bath

house those mean completely different

things in different neighborhoods and

markets so what comes to mind to me is

there’s a um there’s a framework so I’m

in a group with Brian Luben from Action

Academy and um he talks about this

framework that has ever since he shared

it it’s always stuck with me i think it

really applies here called the CVC

framework clarity volume consistency so

what Nathan just described is clarity

right it’s like spending the upfront

time to understand what you’re actually

looking for because if you don’t have

that clarity then you could be taking a

a bunch of you putting in a bunch of

reps but moving in a unclear direction

and that makes it really hard to get to

your end outcome so by taking the time

up front to get really clear on what it

is that you need to be finding in order

to meet your goals that is probably some

of the best spent effort that you can

make some people try and jump straight

in and just start you know uh making

offers and analyzing things but they

don’t really know what they’re looking

for or what they’re aiming for that’s a

good way to waste effort and especially

in a 20-minute investor mindset like we

don’t have time we don’t have time to

waste the second part of that is volume

so once you’ve defined your buy box in

this case the volume game becomes okay

how can I find as many deals that fit

that buy box as possible you don’t

necessarily want to just go um scraping

the internet trying to force things into

your buy box your buy box is specific

for a reason so if you pick three zip

codes and a set of neighborhoods then

you know you’re going to want to just

make sure you’re paying attention to

those so that when things come through

you’re able to analyze them but you have

to emotionally detach yourself a little

bit from it and just say that everything

that meets these parameters I’m going to

analyze and I’m going to do it

consistently which is the final one

which is just you know basically making

a commitment that if I’m clear on what

I’m looking for if I’m putting in the

reps and if I do it for long enough it

will result in a deal that fits my

strategy so I’ve always liked that

framework as a way to think about it um

because it it it’s too easy to get

attached emotionally or start chasing

deals just because you’re impatient you

want one but I do think that if you take

the time to kind of put things in the

lens of that framework that success is

more or less inevitable if you’ve done

the work you know the right way what do

you think about that no I I never

thought of it in the through the lens of

that framework I guess but yeah that’s

exactly what it is and and the I was

thinking of another thing you you

touched on it’s like we talked about you

know how do you analyze a rental in five

minutes and you know we talked about

this in previous episodes as well but

and you know if you’re looking at

several markets several cities several

states potentially right one could argue

that it’s maybe even impossible to

analyze properly in five minutes

primarily for the reasons that in each

of those markets cities counties or

states you’ll have pretty significant

variables in things like you know

property taxes and things like insurance

and things like potentially management

fees or whatever that just make it

impossible if you’re not focused because

they’ll be different and you’re you’re

you’re looking at analyzing apples and

oranges if you’re looking at two

different markets maybe making your your

analysis your spreadsheet or your tool

work for you when in fact that rental is

not a viable one or not one that meets

your investment returns yeah you know it

it hearkens back to the episode we did

one on cash flow and one on property

management and those are where you

really fine-tune your numbers so like if

there’s a if you’re looking in a let’s

say class C neighborhood in a you know

kind of standard Midwest city and

there’s you know high turnover in that

market where you know the occupancy is a

bit lower vacancy is a bit higher your

the property manager you you hire is

very important because they might be

able to overperform against the kind of

citywide data because they’re really

good at operations they’re really good

at finding tenants and then inversely

right like if you have a bad property

manager even in a good market that could

drag down your numbers and so just

knowing what you’re working with like

the market the kind of economics and the

just general market factors as to like

what the tenant profiles are in that

area and then who’s on your team and how

well can they perform like those are the

things that make the most difference in

the margins and if you don’t know those

then your fiveminute analysis could be

based on some comps that you scrape from

you know one of these uh software tools

but you have no idea if it’s accurate

because you haven’t built a team you

haven’t gathered any data so I do think

that’s a really important call out

because there’s um especially in this

day and age there are so many software

tools and they all have their own

algorithms they all have their own um

databases that they’re pulling

information from and the comps that you

get can sometimes be misleading i know

we already talked about that previously

too but if a software is pulling from a

geographic radius but that radius

crosses a main street into a different

part of town and it’s pulling comps in

from that it can distort and I’ve

noticed that in our in our markets i

know you and I both use Deal Check and

we’ve had you know like that’s our go-to

tool for um for deal analysis but even

then I’m auditing and looking at the map

of the comps that Deal Check’s pulling

in and I’m making sure I uncheck things

when I see that it crossed that that

street right or or area so that those

comps don’t get distorted so I guess the

next like logical place here to go is

you know what are the tools what are the

ways so let’s just assume that somebody

has spent the time getting clear on what

they’re looking for and that they have a

buy box and they’re getting ready to go

into the volume phase what are the tools

and and um that that you use and um and

how can you kind of you know fine-tune

those uh to to really fit it in within

five minutes yeah the the I guess the

first one I maybe it’s part of kind of

defining your buy box but maybe for the

sake of clarity here i think for me it

starts with you know your your online um

you know MLS access tool whether it’s

Zillow Realtor Red Fin but it’s actually

setting up a saved search that matches

your criteria so again type of property

number of rooms bedrooms bathrooms you

know square footage zip code school

ratings all that stuff so define your

buy box save it as a saved search in

pick your favorite tool of choice right

in my case I just happen to use Zillow

so that anytime a property that meets

that criteria matches that particular

buy box I get an immediate notification

about it so typically that’s where the

volume piece comes in is like I’ll do

when I wake up in the morning it’s one

of the first things that I do is pull up

my email and I have you know the 5 6 3

10 15 it depends on the day emails from

Zillow of all the properties that were

listed or that have had a change like

price increase price decrease on

offmarket type any type of activity on a

property that matches my buy box so

that’s where my volume comes in and then

just like I was mentioning in my example

earlier I can scan through those emails

where I could quickly see something

that’s way overpriced for it to work i

can kind of park it i don’t necessarily

ignore it completely but I don’t spend

much time on that just like some

properties that are priced way too low

which might sound or seem

counterintuitive but often times

properties that are priced way too low

uh comparatively speaking either they’re

not in a good neighborhood um and the

search failed me in that case or they’re

just like full rehabs which is not

something I’m interested in so I can

just quickly scan through like let’s

call it you know 10 emails that I got

that morning and filter out kind of the

extremes and then that narrows it down

to you know the three four five whatever

it is properties that are more likely to

be spot-on in the middle of kind of my

buy box and then I would typically take

that over either to a spreadsheet like

the one we have in the academy it’s you

know spreadsheets can seem complicated

but once you get used to it they’re not

it’s you know change five six values

here and there and you’ve got your your

rough back of napkin first pass or use a

deal a tool like deal check right i mean

I use Deal Cheek now more so than my

spreadsheet primarily because it’s just

really really fast at doing stuff and

we’re talking about how to do it in five

minutes and it has the advantage that

you can go in and specify what your

investment criteria and and return on

investment criteria are what your

typical fees are property management you

know mortgage rates insurance taxes

stuff like that and then just do a real

quick import and then you get a rough

first look at what those numbers are and

that’s how I do volume and then when I

get to when I narrow the funnel down to

the one or two that seem most promising

so closest to or that map or match sorry

exactly my return goals and stuff like

that then I will kind of move outside of

that quick five minute you know phase

and do deeper due diligence but maybe

that’s a topic for another uh another

conversation yeah and I think it’s

important to understand the difference

between this kind of fiveminut analysis

and due diligence they’re two very

different motions that involve a

completely different level of effort and

uh detail right i think what we’re

looking for in this five-minute process

whether it’s a spreadsheet or a software

tool is a kind of a red light green

light is this worth continuing to spend

time on because you know 20-minute

investor mindset we don’t have hours per

day to just sift through listings and go

you know deep analyze every single deal

so we’re just looking for that quick

kind of pulse check now some people use

things like the 1% rule or maybe they

have a specific cash flow target like

there’s a number of different ways that

you can personally measure whether

something’s worth looking into or not

but like Nathan mentioned our Remote

Real Estate Academy spreadsheet is not

that complex there’s only a few values

that you have to change and there

literally is a red or green indicator if

the values are if your return metrics

are met it’s green if they’re not it’s

red and just because it’s red based on

whatever the list price is you can also

tweak some of those variables and say

well if I were to offer at this price

that’s what it would take to get to a

green light so there is some maneuvering

too it’s not just we’re not just

plugging the list price in and saying

well this makes sense or it doesn’t

pretty much nothing makes sense at the

list price in this day and age um you

know in most markets so there’s also an

an art to seeing like okay am I going to

have to offer at a 50% of the list price

in order to get my return metrics if so

then you have to decide if that’s worth

your time bothering everyone your agent

their agent and ruffling feathers with

the seller that’s a personal decision

you know some people I think you know

low balls are totally expected but like

just understanding that you know the

list price is not the the ultimately

that’s a starting marker that’s what the

seller has said and very rarely is that

the actual price that you will probably

include in your offer so Deal Check and

you know the spreadsheet we have and I’m

sure there’s other tools that do the

same thing they have the ability to help

you calculate what your max offer could

be and if you that’s another like

barometer to say like is this worth

spending time on if you’re only 10 or

15% below the list price and you’re able

to hit your metrics then arguably it is

worth spending time on at least start a

conversation maybe get an offer out

there or spend an extra 15 20 minutes

digging into it but but yeah I just

wanted to add that nuance because I

think one of the traps I see people fall

into is they just plug in the list price

and then they’re like “Wow this is like

either a negative return or it’s only 1%

this sucks i’m moving on.” And you might

be ignoring opportunity if if that’s the

only way you’re you’re looking at it

yeah the only thing I’d add there as

well is just maybe as a word of caution

and mistakes that I know I’ve done and

I’ve seen a lot of people do is like

when you talk about you know plugging

these properties in a spreadsheet

they’re most likely not going to work

out for your return goals you know as a

starting point one thing to be careful

of is when you’re doing your analysis or

your deeper due diligence is to go in

that that tool or the spreadsheet and

actually tweak the correct numbers you

mentioned maybe if I lower the purchase

price I can meet my investment returns

but I’ve often seen folks that will go

in and start tweaking the wrong numbers

for example you know whether you ask

your property manager or you find the

whatever online tool that tells you you

know average rent for a property like

this in this neighborhood is say $1,500

then they go into the spreadsheet excuse

me and we’ll say “Well guess what this

property I think this property is better

than all the other properties so I think

I could probably get $1,700 rent for

this one which is not realistic but it

works on the spreadsheet math and it

makes your your property returns look

good.” Um and that’s kind of an anti

pattern or bad smell to be careful of

right and you could do the same with

well if I find a property manager that

only has 3% monthly fees then this

property would work that’s not realistic

either most likely right so that’s just

something to be aware of and careful

when analyzing deal is to go in and

actually tweak what is realistic and to

stay conservative at least that’s what

you and I do I believe and it’s a lot of

what we like to talk about and teach

yeah it’s a good point so like there are

levers you can pull purchase price is

the easiest one one of the biggest um

you know mistakes I’ll mention which

kind of ties back to what we’ve talked

about in previous episodes about cash

flow some people are like well I’ll just

self-manage so I’m just going to leave

management blank and um you know in that

case even if you do plan to self-manage

take it from someone who self-managed

for 5 years eventually you might not

want to right and if you didn’t build

your proforma with management fees in

then you’ve basically you know put

yourself in a position where your entire

margin is probably going to be eroded

when you do go to hire that property

manager so that’s just one example of

like don’t make assumptions or try and

force numbers into a spreadsheet and you

know like Nathan said if you got a tight

buy box and you know your market you

know who’s on your team you know what

they charge you know the potential you

know historical vacancy rates you know

their lease up fees then you can build

that as a template and you’re not

guessing and you’re not going to have to

force things and you really can just

focus on the one or two levers that do

make sense to pull to to make the deal

work well good stuff right at the

20-minute mark here and hopefully people

got some value if you have a different

strategy or a different tool that you

like we’d love to hear about it drop a

comment or shoot us an email and uh we

will catch you next time thank you for

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