By Ashleigh Ruhl, California Business Journal.
Entrepreneur Kevin Guerin is based in Texas, but 90 percent of his company’s clients are Californians investing in residential real estate in Austin and San Antonio.
Californians looking for potential rental properties or flips are captivated by how far their money can go in Texas, the 49-year-old president and founder of Guerin Property Services says.
A spacious single-family home in a good neighborhood in the hot market from Georgetown to South San Antonio will cost around $200,000. That same home in a comparable California neighborhood could cost at least two or three times that much.
“I’m in one of the best markets in the world,” Guerin says. “What I’ve seen since the crash is a constant level of appreciation, and there are so many people moving into town — the last number I saw was 186 people a day moving into the Austin area.”
He could see the potential for investors back when he started his recession-era business in 2007, but Guerin says there was one problem: even with bargain-by-comparison prices, out-of-staters were apprehensive about not physically being available to shop for property and then perform repairs and manage tenants.
And so, armed with knowledge that came from several years in real estate, plus a strong entrepreneurial spirit, Guerin decided to try what he hoped could be a solution: providing buyers with both real estate and property management services.
“I thought to myself, ‘Why refer out the realtor and property management and maintenance?’ I can do it all,” Guerin says, noting that he also wanted to diversify his family’s income sources to be more reliable than real estate alone. “So I created a company that has everything done under one roof. We handle everything except the lending.”
And then he sought out Californians.
“I realized a lot of money was coming out of California,” he says. “I asked myself, ‘How do you get your phone to ring?’ You have to figure out how to get investors to call you.”
To attract attention, Guerin said he “winged it” by running a print advertisement in a Los Angeles newspaper. It read simply: “Investment property. Austin, Texas. New construction. Cash flow. Call Kevin.”
He’ll never forget how much his phone rang that first day.
More than a decade later, his concept survived the economic downturn, and he says it’ll survive the next because it isn’t solely reliant on new investments. Much of the success of Guerin Property Services relies on the steady property management side.
Rents average $1,800 a month for those $200,000-level homes, and demand only increases on both sides as millennial renters drive the market.
“When you think about the recession and the crash, with an investment home, what better place to have your money sitting? Somebody else is paying your mortgage down for you, and there’s always going to be a need for renters in every downturn,” Guerin says. “That’s why the people with money are swiping these up as much as they can.”
The company currently manages about 250 rental properties (mostly single-family, but also duplex and fourplex) from which they charge a percentage of the monthly rent. They also make commission on real estate transactions, and Guerin’s business juggles nearly a dozen flipping projects at a time, only taking on more when others are complete.
Guerin has managed to turn a one-man show into a genuine family business, with his wife Heather getting her real estate license and operating much of the company as CFO alongside her husband of more than 20 years. The two, who have two teenage boys at home, run the business with a small staff and have earned an A+ from the Better Business Bureau.
That rating, Guerin says, is due to the trust he’s earned from California clients by providing local expertise and being discerning about what neighborhoods he works in. The team selects safe streets with good schools, never anyplace he wouldn’t let his own family spend time.
“I don’t know if there’s anyone else doing this exactly how I am,” he says. “When it comes to buying a home anywhere where you aren’t living, you’re going to need someone that you can trust, that you can pick up the phone and call and say, ‘Hey, I just got an HOA violation, can you get out there and see if the grass is too high?’ We do that. We are very hands-on full-service.”
Helping provide some of that personalized service is Guerin Property Services leasing agent Chad Eastwood, who has been with the company for nearly seven years. He’s known as the “do-it-all field guy,” but Eastwood’s job is really about listening to clients, building relationships and understanding neighborhoods.
“I like being out and being around people and constantly being on the go,” he says. “I’m on the ground, digging around for the good deals.”
The excitement investors feel is palpable when they’re touring Austin and San Antonio, learning about the growth of tech jobs in the area (Texas continues to be among the top-ranked states for tech industry growth) and the affordability of homes. He especially enjoys the challenge of guiding owners through renovation options to maximize rent.
For the team at Guerin Property, it’s been a pleasure doing business with both investors and rental tenants who are keeping both inventory and vacancy rates low. Guerin emphasizes that he’s grateful for the confidence clients have in him, and the business no longer needs advertisements in California newspapers to keep the phones ringing.
“People on the West Coast tell their friends, and they call us,” he says. “I have people who’ve bought 10 houses from us that we manage, and they’ve never been here to see their properties — there’s just such a high level of trust.”
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