Deal flow management for sales

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the threat of a recession is becoming more and more real every single day and today we're going to talk about how investors and tenants can prepare to weather this storm yeah when you're investing you have to consider the tenant right now the tets are in trouble you know if we head into a recession they're already getting slammed with high inflation and red increases and things like food and gas and all those kinds of things are clipping away at them and so as as a landlord you got to be really cognizant there's a bunch of moves that you can make to make sure that you have stable cash flow during this time yeah absolutely and and the first thing you need to understand is that a lot of people are going to be losing their jobs and hours are going to be cut you know if they're self-employed contracts might be cut and you as a landlord have to be understanding of that to a degree this is happened before and and um a lot of during times where rent you have a lot of rent increases and there less um there's less option for the tenant you basically can get away with anything but now it's it's moving the other way it's now basically heading to a renter's market for at least the next 18 months and and so you have to manage differently and you have to be a little different in a landlord and the one thing is you have to consider the Ted it you have to probably do less R increases and what you're trying to do is you're trying to get people to stay there longer because every every single time you have turnover it's expensive you have advertising costs you have maintenance costs you have vacancy all those kinds of things severely impact your cash flow but there are strategies for this right you know I mean it's not that you as a landlord have to just not take rent and you know not get paid but I know MC companies you know something like this happened in 2008 and your company said tenants up on weekly payment plan yeah we did and you know here's the thing this is all about communication if you have a good relationship with your tenant like um like even this week you've been on and off with your tenants all week right tenant issues this yeah but it's okay like at least they're contacting you and you're dealing with them it you know and and hopefully you're at some point with them where you can sit down with them and and say listen um where are you what's going on with your with your job you got one tenant that's actually a commissioned salesperson right and and uh they're a little bit in trouble right yeah okay so you sit down and you say you know what could we do and uh I think she's got a couple kids and you you know it's a it's a situation that she's in and the last thing that you want is to turn over her unit you want to work with her right or her just that pay me in general right and and I've dealt with this with tenants before you know I've had tenants lose jobs and I'm very communicative like if a tenant that always pays un time is now paying me 3 days late you know where they're telling me hey I can't get you rent till the eth I don't just say okay you know I say hey what's going on you know like what's happening well you know my boyfriend lost his job so we're down to one income and then I work with them right well why don't you guys you know pay me you know x amount a week is that easier to make up for this rent you know because he you know just started a new job there was a two week lapse like you know you hear these things all the time and going into this you guys are going to hear this stuff more and sometimes it also just makes sense to let them out of the lease you know I've had to do that a couple times and you don't always have to charge you know like I have tenants where you know they break the lease cuz they want to move early um you know and that's one one case scenario but another case scenario I might say listen if you give me a 30-day notice or a 60-day notice why don't we get you out of the lease because I want someone that comes in that can pay yeah you actually did that there was somebody that came to you mid lease yeah and she lost her job Y and and uh you guys were communicating M and you found a tenant while she was there right and then uh there was maybe just a couple days of vacancy loss exactly and she let me do all the turnover while she was in the unit show and show it cuz you're working together and you know a lot of you may look and say well why wouldn't you charge her you know she broke the lease you know you have in your lease it's a one month you know uh fee Y and it's like yeah but she's going through a hard time and why would I make that harder when she also is going to work with me so I can get that space filled with someone that can pay cuz the last thing I want in my unit is a tenant that's struggling to pay me a it's stressful for them but be a stressful for me and let's look at what the lease break fee is for it's for if you're not communicating with your tenant it gives you a month cushion that's what it's for right so in this particular case the tenant reached out to you you guys had a good relationship already she told you the truth we said okay let's figure this out and and why charge them that if you only had a few days of vacancy yeah absolutely and another thing is to give your tenants some ideas right like if they're struggling to pay R you know you can tell them if they have a two-bedroom or you know even a one-bedroom if they're okay sharing your room like hey if you can sublet you know if you can get a roommate as long as they go through my background and credit check requirements like I'm totally okay with that and and I think you know landlords have become very rigid in the last few years because they've been spoiled right because they can say listen I can just get somebody else in I don't want to deal with this right so they they are spoiled and they're not to their their t managers you know if if you're a if you're a new landlord and you're um you know you better take a look at you know where you're heading I mean maybe you have a really good tenant maybe but this is the time this is the best time for property managers right they're going to sore here because the it's going to expose a lot of stuff well it's so interesting because I'm on some landlord groups on Facebook right because I like being on those I I get some good uh information but you know I see people all the time like I won't even show a unit until until somebody has done a credit and background check I'm not even going to show them a place and it's like okay well I don't necessarily want to do a credit and background check if I would even seen your place you know I don't want my credit run if I don't even know if I want your place but there's so much on their high horse and they're so used to tenants having no options that they want to do that and it's like no I'll show I make it very clear what my credit requirements are so that way I'm not wasting their time or my you know my time or their time but I'm not going to sit up there and be like well you have to apply before you even see the place I mean I think that's ridiculous right and here's the thing if if you just tell a tenant that you're going to run a criminal credit background check typically if they know you're going to do that they typically are communicating with you at that point yeah they don't want to waste their time either of course I've had a couple people where I show up and they're like Hey listen you know but for the most part they're not going to waste their time doing right right so it's that's the wrong that's the wrong message just said to to the and you know and tenants just know like you have a little bit more power now because there's not there is more Supply so don't you know you don't need to be doing that either that's a good point like if if if you have't looked around you should because you know what you want is you want uh people that are working with you and and you have better options now yeah absolutely if a landlord's doing that to you at the beginning it's not really a good president on how they're going to be in the landmar so so the second thing that uh tenants and investors need to keep in mind is your tenants may move out because they're deal shopping so now might not be the time to raise the rent on them because they are looking around and chances are pretty good if you were at Market rent before you're a little above Market rent now yeah and this is why you always need to know like if here's the way here's what you should be doing if you have a tenant let's say you have a 12-month lease you should be looking at like 9 months 8 months uh out and and you should be looking at what the market doing at that point M you should be seeing if there's vacancies you should be checking out what the rents are um you know because in your case you have what 60-day notices right so you're going to want to be armed with all this stuff in month eight and nine and 10 because month 10 you could get a notice from your tenant right and if you're not reaching out to them prior to that you need to reach out to them and month dine and say listen the market has gone up and these rents are l but we're going to keep you the same that would be a good strategy or the market has gone down um you might just want to say we're going to keep you the same but if the if the tenant decides to leave then of course you're going to have a vacancy well you bring up a good point you know the tenant is not going to wait until the 60-day notice to figure out what they're going to do because they have to give you a 60-day notice and so you need to give them some time to do some research and you don't want them looking around so if you let them know 90 days typically tenants are going to look more than 90 days out so if you let them know 90 days out hey your rent's not changing then it's like a weight off their shoulders they don't have to look they don't have to worry about moving they don't have to worry about Price shopping it's just very much a relief for them and in this market you know don't get greedy and want to up your rent 25 or 50 bucks because it's really not worth it to lose a tenant in this market one other thing to consider is that the tenants have a cost to move right so like my my youngest son just moved okay so now obviously he's got a bunch of buddies and they have trucks and all that kind of stuff but um in this particular case you had some furniture and stuff and you know they're back and forth and back and forth but then there's the hookups of all the utilities and most people if if you don't have all that um you're going to have a little U-Haul and you're going to have you know people to help you or or you're going to maybe even use a moving service and then of course moving somewhere else you got extra deposits and you've got the um you know to hook into the you know the cable and the the the the power and all those kinds of things so there there are costs right it's fun though to move into a new place but there are costs that the tenant has and so don't forget as a landlord to consider that you know because they're also looking at a cost to move add an inconvenience right depending on um so so it's not just one way so so when you're when you're looking at maybe rents have gone down or they're trending down um you know if I were in your shoes I would just say hey you know 9 months into a 12- month least we would send something and said you know uh we are we want to renew you at the current rate and then you start a dialogue with them right yep that's that's essentially what you're trying to do you're just trying to hedge the down and and also give them the benefit U if if RS are up you should know that you should say RS in the area are higher and we're going to we're going to keep you at the same rate wa you're trying to do is create stability of cash flow through the next 12 months you know denil did that when she bought this place she actually did a little differently but she found uh uh somebody to do an 18th month lease with a flat fee and then they're doing an Airbnb air Arbitrage I think and so she has a guaranteed number every month guaranteed cash flow every month zero vacancy zero maintenance zero turnover zero marketing and and her only exposure is if that Airbnb Arbitrage doesn't work and they and they end up giving her notice so this is all about cash flow in the long term and and uh you most llord didn't have to worry about the the the having vacancy for very long and and but turnover costs are expensive I mean even in the airbnbs we're hearing two 300 even $400 just for cleaning right right so you know guys like especially if you have a tenant in there a long time and they Pats so whenever it's it's going to be expensive turnover paint's expensive maintenance is expensive so and vacancy is expensive so if you have something let's say that's 3,000 a month which is probably high but let's just say that's $100 a day in vacancy right period so if it's vacant a week that's $700 if it's vacant two weeks it's obviously $1,400 so so you start to see how these things can add up a lot of people don't consider vacancy yeah and I mean to get that additional $25 or $50 that might make your tenant look around you know a week of vacancy is going to just beat that all up it can just be an annoyance trust me if you're if you're going to raise your if you have a $3,000 rent and you tell a tenant you're going to raise them $25 uh they they're just going to be annoyed with you yeah like it's not worth that exactly um and you touched on something another good point is you want to look right now as a landlord and as a tenant at longer leases so yeah I had a girlfriend she just running out her place it's their first place she's running out and she goes they want to do 18 months of course I'm not going to do that but and I said no you should do 18 months in in times of a recession and in times of there's no right growth it is in your benefit to do a longer release if you have a great customer that's paying you timely do a longer leases right now I I mean you guys need to take a look at obviously if you're negative cash flow and and you bought incorrectly and you got your uh grade on your uh loan is is going up and your mortgage payment has gone up and all that kind of stuff you have a different scenario but in this particular case if you have a customer right now that you like and they're paying on time and they're very low maintenance um and and um you you'll they'll always be time trust me and if they're a long-term hold for you you're going to be fine but you're right this is the time to to do longer leases in in the times of of uh you know when there's little Supply you want to do shorter leases and when there's a lot of Supply you want to do log releases so if your Market is going to suffer from let's say a lot of new product and a lot of vacancy then uh that is the time to do L releases yeah absolutely so don't be afraid of those and the next thing we want to touch on is understand that more people are going to be living in your unit potentially so if you have a two bedroom before it would always be one person sometimes maybe two people now look at it like it's going to be like a couple in their mom or a couple in their brother or three friends that want to Li together or four friends that want to Lim together I mean you know you don't want a house packet but it's realistic that you could throw in an additional person or two to make it the rent work well you just had that you had a a young man uh in his 20s come and his mom and him actually rented a place together well it was his mom his fiance and him yeah and and uh his mom wanted it cuz she's like she like coming to Scottsdale or wants to walk she doesn't live in Scottdale and it was a win-win and and so you're right yeah and and then my other unit had um a couple with their brother you know they were younger she was in men school but these situations would have happen five years ago you know they would have just got of their own place but now that everything's so expensive people need additional people to qualify and and what you guys need to consider here is that both need to have their credit run yeah so you always want to have the credit run on both occupants yeah all occupant sure you know's there yeah what what should be on the lease are the cars the the license plate numbers you need to have the information of all occupants and of course pets you know they always slide pets in right absolutely well so this one next one I think is really important and I think that a lot of times investors uh make this big mistake and that's running out V vac renting out vacancies too quickly so you get desperate you want someone in the unit and you just say it's fine I'm moving them in yeah don't do that right this is a you you're you're better off obviously this makes so much sense and and we've been guilty of it I I I have uh obviously we have 300 employees we have had you know there's a lot of pressure from the corporate office to fill vacancies right and there's a lot of pressure you probably have a lot of financial pressure fill vacancies but I will tell you be careful here you know you want to make sure that you you do the process run the criminal credit background checks we do a sex better checks too you know make sure that's all done make sure it's vetted make sure you check all that stuff out make sure they're working where they're say make sure they have the the funds uh and all those things it's it's really no different than if they're buying something you know they're they're essentially if they RS a th a month it's a $112,000 contract like that's the way you have to think about it it's a it's a it's a 12mon contract if you're doing a 12- month lease so that's a big commitment for anybody 12 Grand so you make sure that they could pay you'd be so surprised that when I'm not saying that um um I'm not saying that you can't rent something quickly because you can but um take your time do the right things don't rush the process and if if they if they come today and they want to move in tonight or tomorrow that should you should have some red flags normal people don't do that right normal people have to give notice unless they're in a situation where they're having to quickly leave which you know could be a problem for you um and I think people too you know they they they hear people's stories and and they they just make it seem okay in their head but the truth is you're better off with a vacant unit than having to evict someone or deal with not getting paid or deal with any of those kind of problems because you're you're actually in a much worse situation because now you have somebody in a unit that's not paying so you're better off having a vacant clean unit ready to rent than somebody in a unit that you're fighting with that you're trying to collect with that you actually are incurring legal fees with um who knows about the damage of what's going on in the unit and and maybe the disruption with other tenants that's another thing to consider so there's a you know there just really really really be careful the the key to this business is the tenant the the you finding tenants with good credit and most most tenants are amazingly good yeah absolutely they're great but you just have to be careful and the people that I see that run into trouble are typically small landlords it skip some of the stuff because they're desperate they want to fill it or they you know they even fill it for under Market I mean we're sitting in Airbnb right now that's about half the price it should be because the investors bought it and wanted to put somebody in right away and we got a smoking deal now by the way I mean it's it's like 12,000 low like yeah like for the month like great this this place should be 25 Grand easy a month and uh you know we're half that and so you know that is somebody that was somebody that didn't do their homework well I think they just got nervous they bought the place because they had just bought it and they wanted to fill it and this is the most popular month here and they just stuck Us in and while we appreciate it it wasn't the best investment decision so that's something else you don't want to do you don't want to just hurry up and get somebody in and not get a good rental rate either because that's not really helping you either because you know they're going to be there a year and if you jack them a bunch at the end of the year they're not going to stay right right and it's a brand new place it's you know they paid a lot in the Millions for this place and uh you know they rushed yeah and that's what happened they rushed so you know do your research know your Market know your rents and uh you know before you jump in before you jump into the pool you better know what's happening yep yep and then I think that another point is you know a lot of landlords are refusing to negotiate and I think that that is a mistake now I don't necessarily mean negotiate on the rent but you know typically some people get security deposit and first and last month's rent in a recession people are going to be tight they may not have you know $6,000 to just hand you um so you know if you're comfortable with it you can take off the last month's rent you can do installments on the security deposit you know I know for me when they decide to lease they owe me the security deposit which is a non-refundable deposit that turns into a security deposit to hold the place but I don't need their first month's rent until you know right before they move in so that usually gives them a month to come up with that you know I don't need it all right away because people aren't just aren't going to have it right and and the the the key here is also if you're going to make a deal you have to make the same deal with everyone right so that's the big thing you you want to make sure that if you're deciding on doing something to work with somebody um you can't kind of work with one person and not another one you you just need to make sure that whatever deal you're proposing is the same deal for all that's that's the big thing there so um and this should be pretty black and white you know typically if you find people that have uh poor credit um the one exception we make is sometimes that's medical or sometimes it's a uh a perhaps like a divorce um okay but if they have really high revolving balances and they have history obviously of of lots of apartments or houses and and retals and and their shortterm probably a lot more red flags so you know you know so there's there are things that you can see inside of the app ations and if you guys are confused about this stuff you need to go online and get into some of these landlord groups and get into some of these other things you can have you can um um uh you can learn a lot also make sure that you guys are using the proper forms right yeah absolutely you know don't just pull a form from online and assume that that's going to be fine we've seen this problem like there are lots of leases so the the lease needs to be our lease you know is I don't know what it is maybe eight or 10 pages now yeah you know every year there's something new that we learn and we add and it's um that's a really really important thing because what you want to be able to do is if you come to the situation you want to be able to pull the lease out and enforce it and or have a conversation with the tenant over it at the end of the day everything falls back to the lease you have your landlord tenant laws obviously for each uh state they're different but not that different I mean the you know the um the Discrimination stuff is the same and that's Federal but the there are there are certain things that you can do and not do with security deposits and those kinds of things but things like pets extra people um you know wear and tear uh all that kind of stuff needs to be in your lease because that's what um the that's what you're going to have to fall back on so if you're making a deal with your with your deposits let's say you need to you need to be able to make that deal with everybody so and you can do it like uh around a credit score so let's say they have a maybe they have a 600 credit score because of medical let's say then that's when you say again doesn't matter who doesn't matter if it's a somebody that's older or younger or it doesn't really matter it it just has to be the same all the way through yeah absolutely and and when it comes to the forums that's really important you know my girlfriend I that I was mentioned before that just as getting a tenant I said hey like do you have a lease do you need a lease and she oh no I have one and she sends me over this like one sheet that looks like something that you would fill out like it looks like theet a rental application and I said you know I said well this isn't really very thorough let me send you mine and she's like oh my god do do I really need to have him fill all this out and I said yeah because if you have an issue it always reverts back to the lease any issue that you have with your tenant reverts back to the lease and she was asking me too like well what do I do if they don't pay you know CU she's nervous she's a new landlord I said it all reverts back to the Lea so in the leas if it's not in there then you don't do anything you know what I mean so you have to you have to has to all be in the lease so just make sure if there's something that you guys should invest in as you know new landlords it's a good lease like right if you have to pay 500 bucks for it if you have to pay a, bucks for it it's worth it so what what you're doing if if you cut a deal it needs to be in the lease yeah so and then if there's a um if you're negotiating it's your negotiating the original terms of the lease so you're either negotiating what you're going to put on the lease for a new or you're negotiating with an existing tenant and you're changing the lease but either way everything goes into the lease yeah and tenants will you know question your Lea like I had a a tenant and he got a HOA fine and he said well I don't have to you know he was mad they the fine was kind of ridiculous in my opinion I didn't say that to him but he goes well I don't have to pay this it's like your place and I said no if you look in the lease you initialed right here and it's and he said okay and he paid it but that the truth is if I wouldn't had that in there he's right I would have had to it that's actually a big one so those of you need to go check that because that's uh you know your tenants especially if it's in an HOA which most of them are they seem these days um and the and the the Homer associations offer any kind of fine for whatever then um that needs to pass on to the tenant yeah absolutely that's a that's a big one that's one that's something that a lot of people Miss but people just don't expect their you know landlords sometimes think they can just tell their tenant like this is how it is and it's just not true it just has to be in the lease yep if the tenant if the tenant sees it's not in the lease then it's going to be on you yep so let's talk about Limitless we have limit list coming up at the end of August so good yep yeah it's a obviously we're almost sold out we're um we have 50 speakers three stages uh we got some incredible incredible people coming you know these are real people do a Real Deals and uh not um not the big flash you know these are not high paid professional speakers these are what people doing like Self Storage deals and wellness deals and and obviously multif family and Office Buildings and and uh obviously we have uh Eric Sue I can't wait to to have Eric come because he he's a media company and and he's going to do a whole thing about Ai and how how you can uh build your business through AI we you know we have a u a a podcast stage and and it it's just going to be amazing it's going to be a great event so make sure you use ken1 to get 10% off and we hope to see you guys there yeah by the way it's the 29th 30th and 31st of August at the Gaylord Palms and um we'll be there can't wait to see you guys okay so let's hop into our Ken Pro questions if you guys want to sign up you just go to ken.com jooin dnow so Cindy has a good question so she said I'm moving in with my fiance so I'm looking to sell my house or maybe rent it out I can cash flow 900 a month on it or I can sell it and profit $150,000 it's my primary so I wouldn't owe any taxes my parents think I should sell it because it's an old home but I think you guys would say I should rent it out yes I do in Ohio for reference so here's how I look at things that's a really good question if you had the 150 Grand and you put it into a t- bill let's say right that would make you at 5% that would make you $7500 a year because you again this is all about what are you going to do with the money period it's going to go into a savings account or whatever it is so 900 a month from my standpoint is you know that what is that about 11 Grand so so I look at it that way I look at this is $111,000 U I guess 150 so you know what is that that's about eight or % cash onh cash right so so that's how I look at it I look at not not necessarily the 900 I look at the 150 uh what am I going to do with the 150 now if the 150 is going to move into something else that you're going to buy that's going to cash flow that's a different scenario but if the what if you're just putting the 150 in in in um into you know some kind of a bank account and it's making 3 4% let's say then you know that's what it's going to make so I'm always looking at what am I going to make on my money don't forget the 150 will always be there right right that's that's the one thing to to think about it will always be there it's not going to go away and evaporate so it's it's like a it's like a a slush bun for you you know but if you sell it and then you have the cash sitting there the the the issue is what are you going to do with that so from my standpoint in that scenario uh with 900 month I would do the 9 a month and I would cash flow and then um I would have my t pay that down even more because don't forget the 150 is going to grow if the tenant's paying down your mortgage it'll go to 160 the 170 all just because the tenants paying down the Morgan so that's the other piece absolutely because you know you're going to be charging them let's just say two grand a month on rent and so that two grand I mean they're they're L you're really making two grand a month on it even though you're only cash flowing 900 because they're paying down your mortgage as well right and the other thing is that 900 could be tax-free so obviously I'm not a tax uh professional but what I mean is you've got depreciation uh you may or may not have enough so it might not be all taxfree but there's a piece of that that's for sure taxfree so uh you got to consider that as well yeah absolutely and I also you know and we talk about this on the channel but you know we're in a time of high inflation we believe we're going to stay in a time of high inflation and asset prices do go up over time that doesn't mean they can't soften for a bit but if you hold this thing it's going to go up and you're I believe you're going to kick yourself in 20 years when you look back and you're like I sold my house for aund you know $200,000 now it's worth you know $500,000 if I would have just held it plus all the right you got every single month the way to look at it is obviously it's a good point how what's your hold period if it's 10 years then go back 10 years and say what was this house worth then right right and um you know and just or go back 20 years and you'll take a look I I was just um I was just uh with my mom and uh my mom still has the house that that I grew up in and she paid 10 grand for that house 10 grand crazy I mean now your mom's 90 we have to oh no I know but I've like you know and and at the end of her life um you know uh she was a hairdresser and uh had a great little business but uh didn't have a lot of wealth and it it's all sitting in her house and uh thankfully it's all sitting in her house so we rented it and it pays for her um assisted care yeah yeah I mean the 100% of it so the the tenant because she obviously paid it off but um the the tenant actually pays for her lifestyle right and you Ken takes care of his mom everyone I not get that say but we're just saying and do the math does work for that even if she didn't have K and the point is um the inflation that we're about ready to see is going to grow your out is going to grow the asset price yep absolutely for sure but just remember real estate's not like this it kind of goes up and down but over time it continues to go up right if if the if the FED Even If the Fed is able to achieve 2% in 10 years that's 20% so yeah but of course they're not at that so it could be 30 40% or more right so let's move on to Stuart steuart says what was your biggest challenge when starting out in real estate and how did you overcome it it always is the same thing like most people think it's money actually I will tell you that that's what's on most people's minds that's the obstacle they use when they can't move forward um and I always I always mess around with people because I'm like I'll give you the money and then of course that now that that that obstacle they don't have that obstacle anymore that it throws them off right because they that's something they can hind by it's not that it's the actual deal itself so when you like when you start to look look at a deal um you know it there's math to it right so what's the math what's the cash flow in it Etc that's the hardest part I was talking to a guy yesterday he's super frustrated because he's underwriting deals a lot and he hasn't been able to fight he's writing offers and he can't find anything so it's always with real estate investing it's always the deal itself and um you know you got to be very very careful you know we look at hundreds and hundreds of deals every year and we don't buy that many of them so it's it's the it's that yeah when you have a good deal you know it's easy to raise money right I mean how many people if you came to me with Sydney's situation I I can cash flow $900 a month if I rent this thing out who's going to say no to that like I'm not going to say no you come to me with a cash flowing deal that really works once I look into it I'm 100% going to do that so and you're going to have confidence in telling me you don't have to sell me on it you just have to show me the math and so yeah to Ken's point it's super easy to find people that'll give you money it's just really hard to find a deal right now that cash flows yeah and and the other part of the question was how do you overcome it the you got to underwrite Deals you got to do you got to do the work you got to do the math you know and and you have to uh you have to make it part of your process it's not going to be one day you it's not like buying a shirt on you you have to commit to to commit to the process absolutely so our next question comes from Connor so he sees that you have a jet probably from Instagram so he said what should be considered before purchasing the jet like what did what did you consider yeah so um a couple things what the the reason Ross my partner and I were actually very against having one to be honest we would always say like we could fly Southwest for a few hundred few hundred dollars why wouldn't we just do that what happens is the jet is itself has what's called bonus depreciation and you can actually Rite off 100% of the jet or you used to be able to the laws changed used to be able to run off 100% of the jet in the first year even if it's financed so we were exiting some real estate and um as you should be doing this before you sell something you should be meeting with your tax people and we were and and so this was part of our strategy and um so that was the first thing we were trying to offset legally tax with this bonus appreciation which you can get through the jet so the jet Falls in a category I I like the same as like farm equipment oddly enough and um and and so that's number one but number two that we realize we Qui real quickly realized that the operating cost for the jet of course is also expensive so you want to make sure that you have steady streams of cash flow from lots of different things so we have the development company the construction company we have the the management company we have um kov you know we have a bunch of different businesses that all contribute to the operating and cost of the Jet and so I use it for all those different businesses I I'm going to use it to fly to Limitless as an example we use it to go fly and look at deals to meet with lenders or or or we go and um and fly deals just to look at new stuff so you know so we do use it uh significantly for business we use a little bit of it for personal but it's usually primarily used for business I'm going to call you out on one thing okay I've never seen you fly Southwest in my life you like your assigned seats I do I do but I have I you me American you like to fly America I do I like both all right we'll see you guys next week all right see you