Episode #276 – Encore: 30 Flips A Year Using Paid Traffic with Chris Music

Many real estate investors never flip more than 30 houses a year. But today’s guest, Chris Music, accomplished that goal.

Chris’s secret?

He swapped out direct mail campaigns with online marketing. Not only does he get a better return, but he’s able to work less while flipping 30 houses a year — in California of all places.

In this episode, Chris reveals why online marketing is superior to offline marketing and how it’s helped grow his business consistently over the past couple of years.

Ready to discover why online marketing is your key to growth and success? Listen to the episode now.

Show highlights include:

  • The “Supply Force Depreciation” secret for why home prices continued to rise throughout 2021 against experts’ advice that they would drop ([3:31])
  • Why real estate investing is one of the safest industries in the world (even as the world turns upside down) ([4:38])
  • The weird “Mental Zone” the real estate industry is entering (and why you shouldn’t worry that price inflation is slowing down) ([7:15])
  • How to be a successful real estate investor in California (even as there’s a mass exodus of people leaving) ([8:49])
  • The “Looking For You” reason why Google Ads beast direct mail campaigns 9 times out of 10 ([13:16])
  • Why redesigning your website might be the most profitable marketing investment you make all year ([15:22])

If you’d like to get in touch with Chris Music and sell your house, you can find his website at https://www.psbuyshouses.com/.

Need help with your online marketing? Jump on a FREE strategy session with our team. We’ll dive deep into your market and help you build a custom strategy for finding motivated seller leads online. Schedule for free here: https://adwordsnerds.com/strategy

To get the latest updates directly from Dan and discuss business with other real estate investors, join the REI marketing nerds Facebook group here: https://adwordsnerds.com/group.

Want to find motivated seller leads online but don’t know where to start? Download the free Motivated Seller Keyword Report today at https://adwordsnerds.com/keywords.

Read Full Transcript

You're listening to the “REI Marketing Nerds” podcast, the leading resource for real estate investors who want to dominate their market online. Dan Barrett is the founder of AdWords Nerds, a high-tech digital agency, focusing exclusively on helping real estate investors like you get more leads and deals online, outsmart your competition, and live a freer, more awesome life. And, now, your host, Dan Barrett.

Dan: All right, hello, and I'm here with Chris Music from PS Buys Houses, which is Proud Start Buys Houses, I believe. Right? Is that correct?
Chris: Correct.
Dan: All right, it has been a little while since I checked. But, Chris, you have been a long-running client, really, really amazing to work with, extremely successful investor, so I'm super happy to have you on the show. Thanks so much for being here. [01:02.4]

Chris: Yeah, I appreciate it, Dan. Thanks for having me. I’m looking forward to chatting a little bit.
Dan: Yeah, for sure. I want to talk a little bit about the stuff that you have going on specifically, something you've been doing marketing-wise. I mentioned this before we jumped into the show, but I’ve kind of been starting off the show and actually doing an interview with an investor, just kind of catching up. We're recording this in the back half or the tail-end, really, of 2021. 2020 was dramatic for a variety of reasons. Catch me up a little bit, 2020, the pandemic, what did that do to your market, to your business? How do you feel like you guys came through?
Chris: Yeah, I mean, interesting year, to say the least. For myself, it definitely turned out to be a very good year. Obviously, when everything kind of started being very up in the air in March and kind of leading into April was you were kind of first getting hit with the stay-at-home shelter-in-place stuff. [02:03.2]

I know a lot of folks in the Bay Area and I assume throughout the country kind of pulled back on getting a new project started. Either it stopped altogether or it just created way wider margins than they thought they would need. I know a lot of my lenders kind of took a pause on things like that as well.
But, for me, I kind of just kept pushing forward. I did believe that ultimately we were going to still need places to live, homes needed to be renovated, stuff like that. I mean, I try to be very mindful of a potential drop in value, but I didn't put a complete pause on it. In hindsight, obviously it worked out well because I continued to buy projects that would have worked had I lost 10–15% of value. We didn't do that. We actually continue to grow in value or gain value over that period.
Dan: Yeah.
Chris: All that being said, the projects, they were successful. [02:55.4]

Dan: Yeah, I was going to say, obviously now we're looking back in hindsight and we've been through this really massive rise in home values and everything. Early in that process, did you actually see a dip and then come out of it, or that downturn that everybody else was afraid of, did that just kind of never happen in your market or kind of with the types of properties that you guys were buying?
Dan: I didn't see any dip in actual prices as the ones we were selling kind of right there towards that, we’ll just call it the April, May, June timeframe, they kind of continued to sell according to what the comps were at, if not, kind of already getting that appreciation.
I think mainly it was because a lot of people who were going to sell their home were no longer selling their home, so it was more of a supply of forced appreciation, which for me, whatever the reason is, is not as important as the fact that it's there. Especially as well, for us, we were selling homes that were vacant, so much easier to view that home if somebody is not living there, concerned that you're going to walk in and contaminate where they live at, right? [04:01.8]

That was a big help for us, selling a remodeled home that was vacant, just much more access to folks. The people that were looking to buy were looking at our homes rather than trying to schedule, showing in the house that had kids that they couldn't get into.
Dan: Yeah.
Chris: I guess, to mainly answer your question, no, we didn't see a dip at all. Even in the very beginning, there were a lot of people who were thinking there was going to be something major happening.
Dan: Yeah, that's fascinating. I mean, I was definitely one of those people that was sort of where I was girding for it. I keep saying I know my clients are real estate investors, and kind of like you said, we're always going to need a place to live, right? Real estate felt very safe to me.
But then at the same time, I was always like, restaurants are the safest business. I mean, any individual restaurant is almost going out of business every day, but restaurants as a category are never going to go out of business and then it was the whole world’s time turned upside down. I was definitely one of those people. I find that really fascinating. [05:06.5]

Catch us up. Right now, as we're recording this, it’s October, it's 2021, right? You are in the Bay Area, which is one of these markets where the online marketing sort of ecosystem, as obviously what I know, has always been super competitive. You're there in the heartland of big tech, right? An area where people have always felt really comfortable spending a lot of money. What is your take on your market today? Is it different? Is it more extreme? When you look out at that landscape, what do you see?
Chris: Yeah, great question. I would say, today, it is, I will use the term, kind of more normalizing, definitely throughout the second half of last year and maybe even the first quarter of this year, everything was kind of just going bonkers. But once you get into that supply concept, a lot of people were trying to move, especially from city centers to suburbs, and they wanted to buy these homes that weren't really available. [06:13.4]

But as we've kind of gotten further into this year, I think sellers who were holding off on selling their homes have started to do so, so there is more inventory. I was reading something or heard a podcast the other day where they were saying that the rate of price appreciation has decreased, so it's not that it's not still increasing.
Dan: Right.
Chris: But it's not increasing as fast, right? That kind of, in a nutshell, sums it up. Now, they thought that was caused to freak out and the market was going to crash, but I'm like, at the end of the day, it's still increasing. It’s just not going off at 10% per month like it was at some points, which is obviously not sustainable.
Dan: Right.
Chris: It has, I guess, normalized a little bit, but still overall is strong when I consider a seller’s market. But obviously the Bay Area is not one market, right? There are so many different little pockets, just like a lot of areas are, I would imagine. They get lumped together. There are some areas that have it a little harder than others do, but that's to be expected. [07:11.8]

Dan: Yeah, it is interesting to me that we've been in this weird, I don't want to say bubble because bubble means a certain thing when you talk about economics, but it's almost like we've been in this weird mental zone where we're all used to this really wild price inflation, and now that it's starting to slow down, it's like people are worried. But it's kind of like this was never what was happening before, right? Yeah, it's kind of interesting to watch people's reactions to that, and I always say that stuff is just beyond my salary, right? It's too much for me personally, but it is kind of interesting as an observer to watch all that. [07:53.8]

I'm curious. I'm in Connecticut and you're in California, right? As someone who is outside of California and tries to pay attention to real estate trends and all this stuff, the trend, the sort of bigger meta narrative that always gets spun is people are leaving California. Big tech is moving out of California. We've had clients in places in Texas and they say, Housing prices here are super distorted because Tesla is moving here. Some tech company is moving here and they're moving all their employees, right, and so it disrupts this little town or whatever.
Is that what it feels like or looks like to you inside California, to feel everybody is moving out, or is that just kind of a media narrative that people like to point to because it tells a story, but it doesn't necessarily depict what's actually happening on the ground?
Chris: Yeah. I mean, I have heard of many people leaving the state. I'm sure there are obviously actual stats on that, but how it looks for me when I'm going to sell homes, we still have a lot of people that are looking to buy homes in California and I get multiple offers. A lot of homes sit the first weekend and they're gone. It's not at a point where prices are going down or homes are sitting. [09:12.5]

I don't know exactly how many folks are leaving. I do know that's a real thing, but there are plenty of people that are still staying in California that the houses are still going. As I’m flipping houses, I don't really care how many people are here. I mean, there are too many people here anyway.
Dan: I thought it might be good for some people to leave. That's kind of an issue. Yeah, that’s funny.
Chris: I mean, the thing is that I’m always trying to, I guess, keep in mind and tell folks that they ask me questions about the market or stuff like that. There are things you don’t know about real estate, but I know for me, specifically, primarily what I do is flip homes, and so I’m buying a home, holding for a little bit of time and selling it for a higher price, in theory, so I just care about the middle. It doesn't matter to me if I bought it for 100 and sold it for 200, or if I bought it for a million and sold it for 2 million. It’s whatever is in the middle. [10:02.8]

As long as you can kind of understand that and other forecasts and you can understand that little piece of it, the absolute numbers don't mean anything, so how many people live here is irrelevant. As long as someone was still buying and selling for it, I can get those spread in the middle. I don't get overly worked up about the market and things like that. I do pay attention to it. I do read reports, but that's just not my business model, I guess, ultimately.
Dan: It's also that sort of meta sort of macro-scale economic thing. It matters, but the amount of times that it actually doesn't affect your day-to-day existence is most of the time, right? I’ve been saying that there's this interesting thing happening now where we have all these shortages in the United States, we have these supply chains sort of jam-ups, right? And then we have a labor shortage.
Literally, the Starbucks by my house, which I go to every day, twice a day, because I'm an idiot and I'm going to pay all my money to the Starbucks Corporation, but they're closed this afternoon. They closed at 11:00 because they were like, We just don't have anybody to work here. They just ran out of people. [11:11.5]

I'm like, that kind of thing is interesting to me, but that broader-scale, big-level stuff, it doesn't always play the part in people's day-to-day lives that they're afraid it will—which kind of brings me to my next question, which is what if anything has changed about your marketing stack over this last year period? Because there were a lot of people who were jumping from thing to thing. There were tech changes that happened in Google, Facebook and Apple. There's a lot of stuff happening, and I think a lot of investors, even if they're doing direct mail, are worried that with the kind of market that they're in, like you said, aggressive seller’s market, nothing is working whatever, they're just worried that that that hammer is going to fall. [12:03.7]

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Dan: Right? For you, just as a kind of an overview, have you changed much of what you've done marketing-wise? Is it the same as it has ever been? What has been working for you lately?
Chris: Yeah, I mean, I personally haven't done a whole lot different with my marketing. I mean, you guys manage my online presence, my AdWords, so you may have changed some stuff. I mean, it totally is you, but, to me, I'm still paying you for what you do, right? [13:05.2]

Dan: Yeah, yeah, yeah, but you were investing in Google Ads before and you still are now. But in terms of the stuff that we don't really touch, did you change much about it or do you do a lot of mail? I don't actually even know this. Do you?
Chris: No, I don't. It's something that I have done in the past. I used to do it predominantly, and then obviously kind of around the time when I started working with you guys, I just had this shift in thought. It was like, hey, I mean, the mail is cool, and if you work at it, you will find things there. But it just made more sense fundamentally to go after people who were looking for me rather than I was looking for them.
Dan: Yeah.
Chris: Because mail, it was you mail them and then they respond if they want. In AdWords, they initiate the contact, so it’s kind of like one would think, a little bit of a longer intro. They can't yell at you if they reach out to you. I mean, they still do sometimes, but …
Dan: They shouldn't. They still do sometimes, yeah. [14:03.0]

Chris: Yeah, and obviously this was a handful of years ago and I just thought, hey, we're going to continue to become a more and more online world. Mail is going to become not as important or relevant to people as it once was. So, I kind of just shifted more of my marketing to that, and so I phased out the mail. I was always just looking at the metrics and I just got a better return on the online stuff with you guys.
Dan: Yeah.
Chris: Yeah, I don't do mail. I mean, aside from online with the pay-per-click. Still a lot of face to face. I know wholesalers. I know the people in the industry. When you're around long enough, you just make connections and you can just … things off to each other in that way, different agents, stuff that, nothing wildly crazy.
Dan: I will say, we did a redesign on your website, and so for people that are listening to this, if you want to go check out the site, it's at PSBuysHouses.com. “P” as in Paul, “S”, “buys houses” [dot] com. “PS” stands for “Proud Start”, right? [15:08.5]

I'm actually looking at the site right now. We kind of rebuilt this from scratch and I really like it, by the way. I really like how it looks. I like that it loads really fast. It looks quite good and I know we spent a fair amount of time on the copy and everything. What kind of initially made you want to get into redesigning the site? Because you’ve had the same website for a pretty long time, right, since we’ve kind of worked together?
Chris: I mean, that’s the only website I’ve had and I put that together on Wix when I first started doing this real estate thing, I guess, in 2010. I had to do it myself. I obviously didn't have the financial capability to hire somebody to do it, or at least didn't want to spend what I had to do that. [15:52.7]

But, I mean, initially, for some reason, I don't know why or if this is actually a real thing or not, but in my head is I want to be at the top of the little Google organic search, because I feel like that's going to, one, add validity to my business, as well as generate leads in some fashion, because if anybody googles things, there are the ads and then obviously there’s usually a map or something with some businesses, and there's just a general organic feed.
I just wasn't happy with where I was finding myself on a few different terms. I had been working with an SEO person for a while and it just never quite got to where I wanted to be, and then obviously you guys had started offering an SEO service or a little different SEO service maybe before. We had had a conversation about it and you were like, We could do this, but you have to fix your website because it’s kind of [unclear 16:46.2] or not, and I was like, Oh, okay, if that's the case, we’ve got to go back to then move forward. I mean, I guess that's what we’ve got to do.
That was kind of the impetus of the redesign. Yeah, I mean, it definitely looks a lot better now. It’s a lot cleaner. All that stuff for me is kind of more about getting the result in the end. But to your point that if it’s not built correctly, the foundation is not there, then you could play with it all you want, right, but it's just not going to get to where it’s got to get. [17:12.7]

Dan: Yeah, and actually think, to kind of go back to the beginning of your story, it makes sense if you are just starting out to build your own site a lot of the time, whether that's you're using Investor Carrot or something like Wix, or actually there are a lot of website builders out today, way more than there were even four or five years ago. There's just a ton of them in there. They all tend to be pretty good, right? Wix is kind of the bane of my existence and it has been for a long time.
But it made sense for where you were at, and then, like you said, it wasn't like you were scraping together your last penny to pay for a graphical update for the site, right? It made sense in terms of your broader strategy, what you wanted to do for SEO.
Yeah, I think it looks really good. Again, people should go check it out. PSBuysHouses.com. We actually baked a lot of conversion-rate-optimization stuff into the site, stuff that we saw in landing-page testing that we knew was going to work better, so it's kind of a good site to go and check out. [18:14.5]

As you kind of move through to 2022—which, by the way, even as I say that out loud, seems absolutely insane to me that it's going to be 2022 already, because literally I just remember being like, 2020 is over and that felt like two days ago. You're going into 2022—do you have big goals and you want to grow? Is this a lifestyle business for you where you're like, It's more about the amount of time that I'm spending? What are you trying to do as you go into the next year? It could be big or small, or nothing at all, but I'm curious what your kind of trajectory is in your head. [18:54.1]

Chris: Yeah, I mean, it's a great question. Obviously, it's always good to kind of have a thought or an idea of where you want to be moving. In regards to this specific, I guess, aspect of real estate, obviously predominantly your service provides me leads of people that want to sell homes. I could take that and buy those to flip them. I can wholesale them. I could buy them and use them as rentals, whatever, right? It’s just people that want to sell properties. I primarily have used it to purchase properties and then flip them.
In regards to that, I kind of think that I'm good with where this is at. I do, I don't know, anywhere from 25 to 30 flips a year. That works out well for me and it's a system that I have in place. It doesn't take a whole lot of my time at this point, and so now I kind of use the extra time to do other things, getting into development. A couple of others, a buddy of mine, we bought a lot over in Hayward, if anybody knows the Bay Area, that we're going to build an apartment building on that.
Dan: Wow, cool. That's awesome. Is that the first that you've done, a big multi-family development like that, or do you have [others like it]? [20:00.4]

Chris: Yeah, I mean, there are some of our projects that we’ve built, single-family homes, torn down and rebuilt them, but this is obviously a different space, a lot more different parts and pieces to it. I guess, as with anything, once you’ve kind of got it figured out, it's cool to kind of keep challenging yourself into other ways. I don't know if you want to call it leveling up or whatever.
That’s kind of what we've been working on a lot this year and that'll be for the next couple of years as that thing comes together. We'll see, if we like it, maybe continue on that path. I'm going to jump into those senior residential-care facilities for the elderly that I think is something that’s going to be very much in demand as we move forward here. My mom is retiring and has a particular passion for the elderly, so it would be a cool little thing for her to kind of participate in as well.
Dan: You said your mom?
Chris: Yeah, my mom.
Dan: Cool.
Chris: She’s going to be retiring next year and she needs something to do, basically. She's kind of freaking out about working forever to have nothing going on. [21:00.2]

Dan: Yeah, my mom retired three years ago, and in the beginning, she panicked, and now I feel she's in such a relaxed mode that I can't get her to do anything at all. That's really cool, so you guys are going to kind of partner a little bit, not partner, but kind of team up on that project.
Chris: Yeah, I mean, I'll have some responsibilities for her, so she can have something to do with part of her day, which, I expect, to your point, I'm sure she'll find she's way busier than she thinks she's going to be with just her normal stuff. But for somebody who has worked for the last 40 years, it's kind of scary to know you're not going to have anything, right?
Dan: Yeah.
Chris: It's an investment for me and our family, but obviously a cool little thing for her to kind of work on since she is passionate about caring for the elderly. That's kind of, I guess, to answer the question, the main line of flipping is kind of stay similar, but dedicating more time to doing some of these, I guess, side projects or different kinds of avenues of real estate to kind of keep it interesting, but just learning more stuff. [22:01.6]

Dan: Yeah, it keeps it interesting, too, right? It's like you can do the same thing over and over and it just gets boring, at least for me. I kind of always need to change. I think that's awesome. I think the retirement facility thing is, I mean, obviously you know this, but it's the demographic shift that's happening where we're living longer and longer. We're working the same amount and then we're living longer and longer after that, so I think that's such a cool kind of area to be in. That's super exciting.
For people that want to kind of follow up with you, obviously we talked about the website, PSBuysHouses.com. Is that the best place to kind of check out what you are doing? Is there anything else that you want to promote or put out there?
Chris: Yeah, I mean, obviously that’s my website. That's obviously primarily a website for folks who are interested in selling houses, so if you have a house you want to sell, reach out through that.
Dan: Hit him up.
Chris: Outside of that, I mean, I don't really have any social media stuff. I have my email if you want to throw that out to folks. I'm not just going to give my phone number, obviously. [23:05.8]

Dan: No, no, I won’t even give your email. What I will say is if you are interested, go to PSBuysHouses.com. You can get in touch with Chris, I'm sure, that way.
Chris: Oh yeah, if you put in the little form, it goes to my acquisitions lady, but she’ll share it over to me, but like I said, the email is fine. Obviously, I’ve never really been big on the social media stuff, so I don't know how to do all that.
Dan: It’s probably why you’ve flipped so many homes, if I'm going to be honest. It's all a waste of time.
Chris: To each their own. I mean, I do know a lot of folks that are using that for their business and doing well. It has just never been my thing.
Dan: Yeah, and we actually launched a social media service for real estate investors that has been doing well, so I'm actually all for real social media, but for me, and I'm on social media all the time, yeah, this is kind of like a map, but I had to delete it off my phone. I couldn’t actually [unclear 23:57.3]. I was like …

Chris: Yeah, you can get stuck on there, go down some rabbit holes looking at that stuff. [24:02.8]
Dan: All right, look, when Chris gets a TikTok, I will let everybody know that address, but for the short term, like I said, go check out Chris and what he is doing. Its Proud Star Real Estate Solutions. That is “P” as in Paul, PSBuysHouses.com. Chris Music, thank you so much for being here, man. I really appreciate it and thank you so much for sharing your experience with everybody. It's awesome.
Chris: Yeah, man, I appreciate you having me on and thinking that what I have to say adds value to somebody. I hope it does, and if anybody wants to connect, feel free to reach out. Always happy to shoot the shit about this. That's what we do.
Dan: Awesome. All right, thank you. Thank you, everybody, for watching and I’ll talk to you very soon. Cheers. [24:44.1]

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