Morris Invest Case Study 2.0

[Tyler Jahnke]

Hello BiggerPockets!

I stumbled upon the Morris Invest Case Study by @Ian E. and am now inspired to document my current investment with the company. This is kind of a long post, but I hope you stay with me. Clayton Morris (founder of Morris Invest) has an amazing front facing impression with his valuable podcast (I listen to it everyday) and the multiple interviews he's had with reputable sources (BiggerPockets, EOFire). That's how I got hooked on the buy and hold model his company sells.

Even with all that exposure, and the fact that he's a TV host, it was hard to find and really dig into the details of his company online and there's not a lot of specific content on Morris on BiggerPockets. So here's what transpired:

November 12 - Had a scheduled call with Morris Invest. Thoughts: first, I thought I'd actually be on the phone with Clayton, but it was with Larry, who is an Acquisitions Manager. He gladly answered the 20+ questions I had as if he was reading a script. I get it, he gets the same questions all the time from new investors. Very friendly and easy to talk to. We ended up talking about a couple properties at the end of the 30 minute call and he said he'd email over additional details.

Couple days pass and no email from Larry regarding properties.

November 16 - I assumed I'd get an email from him within 24 hours maybe even 48 but nothing came through so I gave him a call. He explains he sent an email the same day we spoke. I check my SPAM folder, and sure enough it's sitting there. Can't blame this on Morris Invest, feel a little embarrassed, and assess the properties. One of the properties catches my eye:

Acquisition: $24,000 + Rehab: $15,000

Rent: $600

I do my research - LOTS of Google Street View, research on Zip Code, crime stats, Zillow for home value and comp values (I know, not the best) tax numbers. At this point I'm VERY interested and have cash ready.

November 18 - Another Call with Larry for additional questions on the specific property. I ask about everything from Inspection Reports, rehab details (I have specifics for what I want in a rehab), potential scope of work, etc. His general answer was: he'll have my answers by November 22.

November 22 - I follow up with Larry via email as he said I'd have final answers to my questions today.

November 23 - I receive an email from Larry stating the property I'm interested was SOLD over the weekend. He attaches another property in the email for me to look at. I am not interested as it sits directly next to a bar. He states I need to put a property under contract as soon as possible if interested otherwise it'll get picked up quickly.

Obviously, this was not the best example of communication, and set me a little off. I began to question investing with Morris Invest.

November 30 - I receive an email from Larry checking in saying he hasn't forgotten about me. He has some properties becoming available soon. I appreciate this communication and am glad he checked in.

December 5 - I get a property from Larry that catches my eye! $37,000 acquisition + $9,000 in renovations. Should rent at $750/month. I get introduced to Nicole, Operations Manager, I ask to put it under contract, but don't sign just yet.

December 5-7 - I send a couple emails to Nicole regarding the Purchase Agreement, but don't get any answers. I get them answered by asking a colleague who owns his own Realty company. I send another email to Nicole as I need my name revised and cc Larry on the email in for hopes of a prompt response.

December 8 - I sign the Purchase Agreement. Introduced to Danny for Insurance (answer three questions he sent via email) and Daniel for Title work (also answer 3 of his questions via email).

December 12 - I finalize Insurance on the property.

December 13 - Check in with Daniel as I didn't get any updates on closing or next steps after answering his initial questions on 12/8.

December 14 - I receive closing documents, wire instructions, and title work. Need some time to read over everything before signing.

December 15 - Nicole said I'd receive the Scope of Work before closing, but didn't yet, so I check in with her and get it.

December 16 - I send over closing documents, wire money.

December 22 (TODAY!) - I receive the final closing package from Title company with all signed documents. They're saying I should get the Owner's Title Insurance Policy and Deed via email in a couple weeks.

I also am now officially in the rehab phase. Nicole reached out with the Scope of Work and wire instructions. I pay 50% of rehab cost to start construction, 25% in 3 weeks, and the last 25% at completion of renovations. I responded back with numerous questions regarding the Scope as I really want to know where my money is going. I have not wired anything yet. The scope had a number of typos and unreadable line items. Hoping I get a response soon!

I'll keep you all updated!

[Andrew George Dennis]

Hi Tyler,  congrats on what sounds like a great success!  So looking back on it all, was the first dinky house a poor investment in your opinion? (aside from all the lessons you learned)

[Tyler Jahnke]

Hey @Andrew George Dennis - I can honestly say that this was the best investment I ever made. And you probably understand I say that NOT based on my actual ROI $.

From an ROI standpoint, I didn't lose money, but I didn't make much either.

It got my journey started and it toughened me up for the future.

I would never hope that anyone has to go through something like this, but I turned the adversity to a positive and I could never have imagined I'd be where I am now after this.

[Will Zena]

@Tyler Jahnke what is your portfolio looking like now?

[Tyler Jahnke]

Hey @Will Zena

I sold off this house in 2018.

Bought another single family.

Bought a duplex.

Invested passively in 2 apartment complexes.

and I'm a general partner on a 94-unit out in Phoenix.

[Will Zena]

Originally posted by @Tyler Jahnke:

Hey @Will Zena

I sold off this house in 2018.

Bought another single family.

Bought a duplex.

Invested passively in 2 apartment complexes.

and I'm a general partner on a 94-unit out in Phoenix.

 Congrats Tyler!  You've had a great 2 years.

[Son D.]

Congratulations man! you jumped big! I'm still here looking for small residentials :)

[Tyler Jahnke]

Hello everyone!

I'm back 7 years later! WOW...what a RIDE it has been. To catch everyone up to speed on where this journey has taken me:

-I sold this house in 2018.

-I bought another single-family home in Indianapolis which I still own today. Bought it for $86k and did a cash out refi in 2021 when it was appraised for $155k.

-I bought a duplex in Indianapolis for $150k. Also did a cash-out refi in 2021. Worth ~$200k now.

-I invested passively in 3 apartment complexes (Louisville, Phoenix, San Jose)

-I'm a general partner on 3 apartment complexes. One in Phoenix which we sold in 2021...and investors received 100% return on their capital in less than 2 years. One in Sacramento. One in Oakland, CA which we just closed a few months ago.

I never thought my journey in real estate would get to where it is today after buying this little house sight unseen. Wow...was I naive at the time. But it got me started.

Now I focus on buying and renovating apartment buildings with partners and investors! We specialize in finding tremendous value-add opportunities in supply-constrained markets like the SF Bay Area. On our latest deal (a 9-unit in Oakland) we're in the process of adding 3 new units as ADUs, which dramatically bumps up cash flow and property value.

My company's mission is to build wealth and housing!

If you'd like to connect, send me a message! I love chatting with anyone and everyone!

[Bob E.]

Thanks for sharing.  The advice i give to new people is that the most important deal you make is the first one.  If you go in willing to learn you will be on the path to prosperity.