Conversation for the future of humanity

[Daniel Hankins]

There are two types of people in this world. People who see problems, and people who choose to try and fix them. How many of us walk past trash that is in our direct path, but instead of picking it up, just assume that someone else will. “Not my circus, not my monkeys.” I put my decade into retail, and I first heard some of this philosophy in sales training. It made sense then and it makes sense now, but back then it was being used in the worst way. All the management pyramid above me cared about was pulling levers to make sure we made more profit then last year. I’m sure I am not alone in witnessing reorganization every 2 to 3 years, but the end results were always focused on cutting out the human “waste” and maximizing what could be done with less people for the same hourly wages. I mean this in the nicest way, but **** that operating model. We, the people who made our CEO’s millions, deserve the praise and appropriate compensation for busting our asses 40 to 80 hours a week, so that they could go play golf and write it off as a business meeting.I chose a few years back to convert my time to fixing the problems that I care most about, instead of helping build up the people who treat 80% of us as an expendable resource. I may still only be a small grain of sand in this time and place in our universe, but I will no longer let myself be willfully ignorant as to what I am contributing my effort into building. That being said, I am going to keep sharing and allow myself to be vulnerable in sharing my vision for the future. People can take it or leave it. The trolls will continue to have their fun, but they usually end up helping me in my effort to be an optimistic stoic, and I take pity on the lives that had to be experienced to make trolls find joy in others misery.. Pessimists (realists, if you prefer), what parts of the world around you make you lose faith in humanity, and why does it have to be that way, just because that’s the way it has always been?Through this post, I am not looking for investors or buyers, or a pat on the back. I want discussion and change. I have worked on this daily for nearly 3 years, and have shared with friends and family to fine tune over the last year or so. Now it is time to get thoughts from outside my own little bubble. I have posted parts of this before, and get a little conversation here and there. Today I am posting more technical “how” instead of the “what”, but feel free to look up previous posts for more info. If I get no traction today, I can guarantee I will edit some more and try again in the near future. Humanity is on the brink of greatness, and all we need to do is shift our mindset for what we use all of our hard work to accomplish.If this is inappropriate for this forum, I apologize for not conveying this in a way that matters to you, but I argue that the underlying ideas can be converted into anything you put your mind to.

Sorry for formatting errors from pasting from google drive.

1. Find houses that are falling behind on repair and maintenance.
   1. Bike and walk dogs through the current neighborhood.
   2. Recently widowed homeowners are a good candidate.
   3. Find a small amount of time to donate to helping neighbors do easy projects.
      1. Use this time as an opportunity to learn what they need, what support they have, long term goals, etc.
      2. Create community events to take care of the properties that are farthest behind.
   4. Create an actual govt program to be more productive with govt owned properties.
      1. Instead of selling the property to an investor, fix the property with the specific intent of providing housing for some form of underserved population.
      2. This is the reasoning behind structuring as a non-profit.
      3. If created correctly might be a great way to scale by using other “flippers” as partners. Maybe have some sort of special qualification to show that all of their properties meet or exceed a specific checklist of predetermined updates to the property.
2. “Buy” the property from the homeowner at current market price, but let them continue to live there and offer continued support to get the house up to common standards, and keep it that way.
   1. Establish minimum standards referencing those used to obtain FHA lending.
   2. Probably worth a professional home inspection if it has been more than 6 years since the last.
      1. Build a step by step scope of work and schedule that brings the house up to common standards.
      2. Schedule “check-up” walk throughs after year 1, year 3, and every 3 years after that.
   3. Ideally the resident of the property will carry the note, or a combination of a smaller loan from a bank to cover a chunk of cash if needed.
      1. Establish the purchase price at the beginning of the relationship based on current market value. Allow portions of the renovation expenses to be paid for by the GNA in exchange for a principal payment towards the purchase of the home. (Current Trial)
      2. The resident holds the note with no interest until they are ready to move.
      3. Once equity hits 30%, offer to get investor financing to get a lump sum payment, and revert to renting for the cost of operation.
   4. Create a crowdfunded investment portfolio to fund the different stages of the process.
      1. Allow any dollar amount to be invested. Market towards the best mix of smart investing, and providing humanitarian services for the communities we live in.
      2. Match or beat 1 year CD returns for a bank. Look into options to rollover into amortized payback or growth.
      3. Offer long term retirement funds that look similar to mortgage amortization schedules.
      4. Explore options to donate portions of the interest gained to provide community support to help rehab homes with people who need help, but can’t afford it.
      5. Create regularly updated, highly visual progress reports for the various remodel/ renovation projects. This would be a great marketing tool to make this investing option more appealing than traditional investing. It would be cool to mount project cameras that create a time lapse of each process. Bonus if it can be turned into an educational how-to guide.
3. The resident can either pay out of pocket for any work needing to be done, or they can let the GNA cover it in exchange for direct principal payments off the original market price purchase.
   1. Make a simple guide to what needs to be done on a regular basis, and establish a plan for what the resident can handle, vs what the GNA provides.
   2. Create synergy with kids and grandkids to accomplish common/ regular tasks.
      1. Opportunity for daycare/ day camp, or even homeschool type services.
      2. Opportunity for future continued business partners to take over living on the residence.
   3. Preferred scenario, resident pays for material and professional labor, and the GNA provides cheaper labor for easy tasks etc.
      1. Residents may pay part of the labor cost, but ideally if the GNA has cash to pay internal employees, then those costs get applied as principal payments.
      2. Explore options that let GNA employees trade time for ownership of that specific property, instead of traditional pay, or use it as an overtime bonus.
   4. Find ways to incorporate local artists and craftsmen, and make unique projects that incorporate the story of the house as told by the resident. Every resident should leave behind part of their story and history.
      1. Add an inspiration page to the website.
      2. Would even be fun to do DIY projects with the resident directly.
4. Offer additional services as needed, including healthcare support, social support, general errands etc.
   1. Leverage nursing friends to create a home health care wing of the company.
   2. Explore research on the use of therapy animals, and incorporate into services.
   3. Create events that promote group interactions across the various tenants within the GNA community.
      1. Team sports
      2. Regular cookouts
      3. Team building
   4. Find ways to focus on any positive impacts for children in the home.
      1. Look into unique tutoring or home schooling business ventures.
      2. Provide ride services to ensure kids get to school.
      3. Offer daycare services.
      4. Create a unique fund matching opportunity to promote investment in an early fund for either graduation or retirement.
5. When a resident is ready to move, offer support in other available properties within the GNA, or moving services to their desired location.
   1. Build a department to assist in everything moving related, including processing procedures for personal belongings that may not fit in the new location.
   2. Explore the idea of a “Brick and Mortar” operation to deal with accumulation of household items that is an inevitable part of the entire process. Try to avoid throwing everything away.
6. The resident can collect monthly payments until the property is purchased in full by the GNA, or can cash out and a traditional loan will be sought for GNA to finish the purchase.
   1. If there is an “owner carry” deal currently established, then subtract the remaining rehab costs as a principal payment.
   2. If the GNA is simply purchasing the property, then it needs to fall into “70% rule”.
      1. Purchase price = 70%ARV - Est rehab
      2. This option typically leaves less money for the original homeowner, when compared to the “owner carry” structure.
   3. Allow for equity transfer to other properties in the GNA portfolio.
      1. This option might allow for the lowest cost to process everything,
7. Bring every aspect of the property up to common standards.
   1. “If you are going to do it, do it right.”
   2. Be creative and conscious of everything that is salvageable.
      1. Refinish and sell/ donate old fixtures.
      2. Repair over replace if possible. Keep tabs on new age techniques (resin, etc.)
8. Hire a live in manager resident that will gain ownership of the property through proper management and monthly dues that cover repair budgets, taxes, insurance, amortized purchase of the property, and management support from the GNA.
   1. GNA marketing: Looking for an apprentice steward for this property, and a partner in the long term equity to be gained from the property. In exchange it is possible to get a reduction in rent for those who are able to effectively self manage the property, as well as additional opportunities to make hourly wages as high as $21 an hour. I want someone who is interested in developing themselves as well as the property and I want to provide all the tools necessary to enhance the ability of the steward to start their own business.
   2. (Alternate) -Good Neighbor University: Use all of the accumulated knowledge, guides, and trackers to teach new highschool graduates how to renovate and maintain a home, how to manage the entire accounting process (both personally and the business of their property). They can still complete all the general education classes at a local community college. The GNA will provide a property to be used as their housing, and as a job. The scope of work can be full renovation of their own property, management of their property, and additional work across the GNA. Their monthly housing dues will cover the operating costs and create a repair budget to help them appropriately manage their property. In exchange they will gain partnered ownership (equity) in the property. Pay scale will follow the $12, $15, $18 per hour scale described elsewhere in the plan.
      1. Additionally might be able to offer employee benefits including healthcare, retirement support, and technical training.
      2. Target market might be easier to access by creating a “Flip to Own” process. Might also be wise to target the younger generation before they get too far into a career or college path.
   3. Household income must be 3 times the “Monthly Operation Payment”.
      1. Create unique opportunities to create income from excess space in a property (vacation/air bnb, temp housing for travel nurse, students, etc.)
      2. Residents may choose to use roommates to meet this requirement.
   4. Pet owners buy all the flooring instead of a pet deposit. If they don’t need replaced, might offer to dump it back into the built up repair fund on moving out.
   5. Instead of a traditional deposit, the new resident can spend up to .1% market value on initial property upgrades, finishes, etc. This is applied as a direct principal payment.
      1. Good test to see how easy they are to work with on household projects.
      2. This gets an early vested interest in the property, which is the primary principal of this plan.
   6. Require reading “7 Habits of Highly Effective People”
      1. Must create a habit of reading for 15 minutes every day until the book is done.
      2. This helps lay groundwork to understand much of the management process expected. Many of the guides follow these principles, and the new resident will be required to complete several activities derived from the book.
   7. Legal structure will likely mirror that of a “Rent to Own” plan.
      1. Create legal contract that establishes the tenant purchasing the property from the GNA at the current market price. The GNA will carry the note and establish unique guidelines that dictate the “Monthly Operating Payment”, and the procedures when the tenant wishes to move out of the property. This will also spell out all the rules and regulations to continue to qualify/ avoid eviction.
      2. Instead of using fear of eviction as a means to keep tenants in line, create a cultural shift to address underlying problems instead. We don’t need to help people dig a deeper hole when they are already in trouble. We should instead work together to build a solution that ensures the moral support needed to get to a better place in life.I think the way the whole organization is structured will also provide another sense of accountability towards each other.
      3. Create a “Flip to Own” plan that lets future tenants be more involved with the initial renovation between occupants.
   8. Create a transparent “Monthly Operation Payment” that includes:
      1. An investment buy in (market value amortized over 30 years @ current market rate + .3%).
      2. Taxes & insurance (will also need renters insurance).
      3. Utilities (goal is to have a history of avgs, but will be paid as billed).
      4. Any cost associated with labor support for “Property Stewardship Guide” (basic cleaning and lawn care).
      5. Repairs and Maintenance budget (.1% market value, any expense related to maintaining current market value/ rent ready condition).
      6. Capital Expenditures- Major repair budget (.1% market value, any expense related to increasing market value and capital expenditures).
      7. Good neighbor assistance dues (.1% market value, covers accounting costs and assistance access).
   9. Create an app that makes monthly property management an easy habit.
      1. Pull information from Property Stewardship Guide
      2. It keeps track of all the costs that determine the monthly payment, including utilities.
      3. It has a checklist of that months maintenance tasks, based on the standards of the GNA, that ensures the most effective life of the property.
      4. Have a portal to submit rent payments, using paypal or similar services.
      5. Build in an option to apply employee wages from the GNA as rent payments.
      6. Have a profile page with all the important dates and documents.
   10. Leverage these managing residents to build a coalition of labor support for the rest of the properties under the GNA umbrella.
   11. If they are all employees of the GNA non profit, then we can distribute benefits including healthcare, retirement savings, etc.
   12. Create a rolling pay scale:
   13. Offer work in exchange for equity ownership in other projects.
9. When the current managing resident is ready to move, they can either cash out remaining repair budgets and equity, or leave their equity in and share the profits with GNA equal to their equity share.
   1. The managing resident will partner in the process of getting the house back to full market standards.
      1. Use the stockpiled repair budgets to fix their respective categories.
      2. Use built up equity if repair budgets don’t cover that cost.
      3. The remaining repair budgets will be applied as a direct principal payment.
   2. If the managing resident wants to cash out, then the GNA will buy back the property at the current market price.
      1. Both parties will pay their traditional closing costs if applicable.
   3. If the managing resident wants to remain an equity partner, then the title is changed to reflect that business relationship, and the managing resident receives monthly payments equal to their share of rental profits or interest payments of the next resident.
      1. Previous managing residents must create and manage their own LLC.
      2. If the previous resident has more than 50% ownership in the property, then they are in charge of managing the property.
      3. The monthly payment for the previous residents equity will be equal to their percentage of ownership times either the interest earned from the next resident’s purchase, or from the profits if it is run as a traditional rental.