Posted July 12, 2021 in Podcast
Creative Problem Solving in Real Estate and Life
Raise your hand if you feel lost in the home-buying process right now. (Let’s be real, most of us are raising our hands.)
It’s a crazy market, and it seems like there is no light at the end of the tunnel for those making an honest living. It can also be a confusing process, which can leave homebuyers exhausted from decision fatigue.
If you’re not looking for a home right now, maybe today you feel stuck in debt or in bad habits, and those hurdles are keeping you from pursuing a path toward a life filled with meaning and achievement.
The good news is that you already have everything you need inside of you to work out these problems, you just don’t know how to unlock those creative problem-solving skills yet!
Today’s guest can help. He has been right where you are and can teach you how to unlock your potential. In fact, he has a motivating debt-free and alcohol-free journey he will be sharing with us. It’s encouraged me greatly, and I know it will encourage you too.
Steve Valentine not only has an inspiring story to tell, but he has incredible insight into what’s happening in the real estate market today. This is a must-read! In this episode, we talk a little bit about what’s going on in the world of real estate because it’s been a wild ride as we sit here in the middle of 2021. This conversation is jam-packed with good stuff about business and life, so let’s get to it!
Who Is Steve Valentine?
Steve Valentine is the Founder and CEO of the Valentine Group in Peoria, Arizona. He does more than buy and sell houses with his clients — with more than 20 years of real estate experience, he’s fanatical about handcrafting the right strategy for each client using his toolbox of absurdly effective techniques.
He outright refused financial ruin to build a retirement-sustaining real estate portfolio of more than $15 million in value. A portfolio that is so diverse and has been so fun to create, he’s educating others to do the same.
Steve has created a real estate business that encompasses all of today’s top strategies including traditional real estate, flipping homes, buying off-market opportunities, and building wealth for himself, his team, and his clients.
He’s married to Wende, who is also a general contractor, and together they have two teenage boys, Christian and Chase.
Real Estate Trends in 2021
I asked Steve about how the real estate market has been from his perspective, and this is how he described it:
“It’s bananas. Like you don’t even know how to explain it or describe it to anybody other than it’s bananas. We’re really trying to do a good job of just guiding people through it. We’ve had probably the most appreciation year to date — or over the last couple of years — [compared to] any market in the country.” – Steve Valentine
Steve explained that the economy in Peoria/Phoenix, where he is located, has been incredibly diverse in so many different sectors of the market between building and technology. Also, many people have moved there from Arizona to California, Oregon, and Washington in search of a better life.
He explained that what’s happening now in real estate does not compare to the 2007 market crash if any of you are worried.
“I’ve been in the business for 22 years, so I’ve seen the market do all kinds of weird trends. The thing that is so different about right now is that the market and the appreciation and where we’re going is being driven by the homeowner, not by the investor. So in 2006 and 2007, everything that drove that market to insanity and then the drop was fake loans and fake people buying houses. I mean the movie, The Big Short probably says it best.” – Steve Valentine
Steve helps his clients know if they are prepared to enter this market or not. The reality is, theoff markety need to ask themselves these three questions first:
- Are you prepared to pay 5-10% above the list price?
- Are you willing to waive the appraisal that may or may not come into that value?
- Do you have the cash to make up the difference?
“If you don’t have those things, I have two pieces of advice: One, stay on the sidelines and rent until you have extra money or [two,] go get a co-sign or something of that nature to where you can be ready for this.” – Steve Valentine
According to Steve, the average home buyer is writing five to six offers before they get something, and when they don’t have the cash to make up the difference, it’s most likely not going to work out for them. Many people give up at the end of six months.
He suggests that people be prepared and ready if the right home comes along and to be patient until your real estate agent finds the right place that fits what you are looking for. They could find a distressed property like a foreclosure, and it would be worth the wait for the right buyer.
“When it comes to foreclosures, there might be one per week, where back in 2007, there were about 200 per day. The banks aren’t doing frivolous lending anymore, and this is a different situation.” – Steve Valentine
It’s definitely a seller’s market, but if you are a buyer, take heart. You just need to have patience for the process.
Other times, Steve has to be transparent with his clients and coach them by saying he doesn’t think it’s the right time for them emotionally to be buying a house.
“I’m like, ‘Look, emptying out your 401k to compete with the other 12 people to get this house —I don’t know if that’s the smartest thing in the world to do.” – Steve Valentine
When it comes to making bad decisions with money, Steve has lived it all, so he is speaking from experience. He shared his debt-free journey with me in this conversation, and it’s incredible to see that he and his family made it to the other side.
A Debt-Free Journey and Career Pivot
In his early 20’s, Steve had just gotten married, and his dad made him go through the Dave Ramsey process to pay off his credit cards. Then, they had a partnership with his parents in business and overextended themselves. Soon, they were in over their heads in debt. They cancelled their partnership with his parents in 2008 and sold the businesses they had built, including a construction business where they had 50 employees.
They walked away from the business with a million dollars of guaranteed debt that they had to pay back themselves since they no longer had any business partners.
They ended up losing their house to foreclosure, their second mortgage was $150,000, and they owed American Express $400,000. On top of that, they owed a couple of friends and clients personal money to the tune of a couple hundred thousand dollars.
To say they were in deep trouble was an understatement.
“Not only did we have all this debt, but we were barely able to rent something. We were playing hide and seek with the cars because we couldn’t pay car payments, and in November 2008, I broke my neck in a mad mud run. It almost paralyzed me.” – Steve Valentine
When he and his family felt like they had hit rock bottom, an opportunity presented itself.
REO or real estate-owned accounts, which were foreclosed houses that the banks would give real estate agents to sell, were being created during the financial housing crisis. Steve had a great relationship with a real estate brokerage, and they gave him the opportunity.
He started making good money selling houses, and for the next four years, he had a three-page spreadsheet where he mapped out how to get out of debt. He did the “Dave Ramsey thing” and paid off the small debts first, got rid of credit cards, and started saving money so that they could pay people back.
,By 2012, he and his wife Wende paid off their IRS debt, paid a million dollars worth of credit off, and never filed bankruptcy. In 2012, they were able to buy a house again. Now, 13 years later, they are in a great position financially. From that season, there are three major things Steve and Wende learned:
- Make sure you always have reserves — savings, emergency funds, etc.
- Do your research, and take time with business partnerships. Make sure you explore them very deeply before they happen.
- Don’t overextend personally. Don’t own anything that you can’t afford.
A Successful Alcohol-Free Journey
The third and final part of Steve’s story is his journey towards being alcohol-free, which is a term he prefers over “sobriety.” He makes that distinction because he made the choice just to stop drinking, as opposed to struggling with sobriety. As of this interview, Steve has not had a drink in 345 days.
“I would still love to have drinks with you tomorrow, but I made a choice for certain reasons, and it wasn’t it wasn’t all awesome at the beginning, but I’m sticking to that choice.” – Steve Valentine
Steve remembers a year ago when his wife sat him on the couch and told him he had to go to rehab. He wouldn’t listen. It was a realization he had to come to on his own.
“If you make a choice to stop something or start something because of something or somebody else, it is always going to be something you resent when things go wrong. So I had to make the choice internally. And once I made the choice internally, it would impact everything around me. But if I did it for everybody else, it was never going to stick.” – Steve Valentine
What Steve wishes is that people would ask him more about the how and why of his alcohol-free journey. Why the choice now? What keeps him on that?
“It’s like making the choice to be healthy. You’re not going to go back down that road to weigh 400 pounds if you made a choice to lose two hundred. I might like a good glass of scotch when I’m 60, but right now it doesn’t fit in with my focus and where I’m driving to.” – Steve Valentine
What’s amazing is the discovery Steve made when he compared his profit and loss statement now to when he took his last drink on May 27, 2020. Now that he is not drinking, he is making triple the income! So not only is he doing it for his health, but his finances have also improved as well as family life and every other aspect of his life.
Whether it’s in business, personal finances, family, or health, Steve has learned how to creatively problem-solve so he can live the life he has always wanted. He is firm and focused on his vision and is now living a life of fulfillment both at work and outside of work. Just like I often say in this podcast, we shouldn’t have to sacrifice our personal balance sheet for our professional balance sheet. Finding that balance makes all the difference. That is what living beyond truly means.
Why You Should Listen to This Podcast Episode with Steve Valentine Right Now…
Guys, this interview with Steve Valentine is inspiring — especially for those of you who are going through your own debt-free or home-buying journey. There are so many pieces of wisdom that you can take from this interview to increase your motivation to overcome hurdles in your life.
Before I end, I want to share something Steve said that really stuck out to me. I asked him about a “drawing a line in the sand moment,” and he said,
“It’s always looking at if all of these shifts are things you can afford to do to stabilize your family, and sometimes you can’t. There’s a lot of stuff we don’t do anymore, like using credit and leverage. There are a lot of things we do differently now.” – Steve Valentine
Maybe there are things you need to look at in your own life right now and ask yourself, “Can I be doing this differently? How can I best support myself and my family?” Sometimes these questions can lead to out-of-the-box solutions. Like the old adage says, “If you do what you’ve always done, you’ll get what you’ve always gotten.”
If you found value from this episode, it would mean a lot to me if you would take a few seconds and write a five-star review and maybe share it with some of your friends on Apple Podcasts. I’d be so grateful! I’d also love it if you would tag Steve, @stevedvalentine, and me, @kyle_depiesse, on Instagram with your greatest takeaways from the episode!
Cheers to your success! I’m rooting for you.