Apartment Building Investing with Michael Blank Podcast

Bobby Casey, an entrepreneur, and world traveler who now specializes in helping people protect their assets and live off the grid. He’s managing director of Global Wealth Protection, which provide asset protection strategies to shield your wealth from frivolous litigation and create "sleep at night" insurance. 

His company can properly structure your offshore company, trusts, foundations and provide bank account introductions to more than a dozen banks around the world. In addition, they can help you move your IRA funds offshore.

We truly live in a world gone mad. Lawsuits are easy to file, the rewards can be enormous, and there’s no down side to losing a lawsuit.

Story of house flip.

Bobby describes how to structure the entities so that it’s hard for attorneys to figure out what you own. By using advanced techniques, like irrevocable trusts, it’s actually possible to not own anything, so even if you do get sued, there’s nothing to attach the judgment to.

Listen to this episode and implement Bobby’s techniques NOW before you lose it all.

 Key Takeaways:

[3:39] Bobby’s Backstory

  • Owns Global Wealth Protection
  • His mission is to teach people how to internationalize their business, wealth, and life.
  • He caters to those who are interested in an international business and lifestyle

[4:32] His thoughts on living like a nomad

  • He’s been an expat for almost a decade and lives in Latvia
  • He says a digital nomad is “an expat with commitment issues”
  • He is passionate because the technology today makes it significantly easier to become a digital nomad.

[7:26] His life before he became a digital nomad

  • Started, bought, sold a dozen businesses.
  • He has been an entrepreneur his entire adult life and had a few epic failures along the way.
  • He started being a digital nomad because he’s an expat.

[9:47] His thoughts on real estate investing

  • Real estate investing is a great opportunity for people who want to have a nomadic lifestyle.
  • He likes the concept of parking money in physical assets.
  • His advice is to diversify geographically

[13:16] Mistakes investors often make

  • Poor structuring of a deal is a common mistake
  • He provides an example of how damaging poor structuring can be

[17:21] His advice to prevent poor structuring of deals

  • He doesn’t recommend home state LLC own their property
  • Don’t create an umbrella of ownership in one corporation
  • Have an irrevocable trust on the membership interest in all LLCs

[21:50] Irrevocable trust and its beneficiaries

  • An irrevocable trust is an asset protection and estate planning tool
  • You'll be a grantor or settlor of the trust.
  • You don't have any asset that's attachable at a judgment at all.

[26:20] Federal Lawsuits

  • According to the American Bar Association, the statistics on federal lawsuits says a new lawsuit is filed every 16.5 seconds.

[29:26] Another mistake and what’s it like to file a lawsuit in the US

  • Another common mistake is owning a property in your own name.
  • A mindset that no one will sue you makes no sense.
  • In the US, there are no consequences to sue somebody for no good reason.

[34:20] Bobby’s advice on implementing asset security

  • Don’t own anything in your name.
  • Have a properly structured LLC
  • Wyoming is a preferred state unless you live there in which case use Nevada.

[37:37] Bobby’s “aha” moment

  • Started a business in the 90's assembling bicycles for Walmart.
  • An official letter from Walmart suddenly canceled his vendor contract as of that day. This was his big wake-up call on putting too many eggs in one basket.

Connect with Bobby Casey:

Resources Mentioned:

 

Direct download: MB_053-_Dont_Lose_it_All__With_Bobby_Casey.mp3
Category:Commercial Real Estate -- posted at: 3:02pm EDT

Gino Barbaro is passionate about multifamily investing, and he believes it’s about the strength of your WHY that determines your success. You must DECIDE you want to change your life, and if you do, you have no choice but to take massive action.

That’s what he did several years ago. Gino was in the restaurant business for 22 years, and he was burned out. He decided he needed to change his life, and he chose real estate to do it.

In this episode, he chronicles his amazing journey from pizza guy to full time multifamily investor. Despite setbacks, a bad partnership and an all consuming day job at the restaurant, he and his partner Jake did their first deal, a 25-unit in Knoxville TN. Today they own nearly 700 units and the sky’s the limit.

Together with Jake, he created Jake and Gino.com, a real estate educational company that offers coaching and training in real estate investing. He is the best selling author of the book “Wheelbarrow Profits”.

Listen and be inspired by Gino’s story. Decide and Your Real Estate Success Will Follow.

About Gino Barbaro

Gino Barbaro is an investor, business owner and entrepreneur. He has been investing in real estate for 15 years and has grown his multifamily portfolio to 674 units in 3 years. He has teamed up with Jake Stenziano to create Jake and Gino.com, a real estate educational company that offers coaching and training in real estate investing. He is the best-selling author of “Wheelbarrow Profits”. Visit Wheelbarrow Profits Tutorial, an educational product focused on multifamily investing. Gino is a graduate of IPEC (Institute for Professional Excellence in Coaching) and is a Certified Professional Coach. He is also the author of the best-selling cookbook "Family Food and the Friars". He currently resides in New York with his beautiful wife Julia and their six children Gabriella, Michael, Sofia, Veronica, Cecilia and Laura. To learn more about Gino visit his website Jake & Gino or Gino Barbaro

Key Takeaways

[2:19] Gino’s background in the restaurant industry

[3:54] The two types of motivation

  • Moving towards pleasure or away from pain

[5:00]- Gino’s rough start in real estate investing

  • No focus on a specific niche or market
  • Mobile home park failure

[7:18] Why there’s no such thing as a mistake

[8:41] Why Gino decided to invest in apartments

  • Didn’t want to rehab and flip properties
  • Less work than single family investing
  • Single family investing in the NY market didn’t work well

[12:44] The benefits of a partnership

  • Formed a partnership with Jake Stenziano in 2010
  • Your partner can help you see something you don’t see
  • Two minds better than one
  • Stronger balance sheet

[14:15] Gino’s and Jake’s first deal

  • Invested in an “Emerging Market”
  • Property was listed for 750K
  • Purchased for 500K
  • Value added buy - Lots of little things that added up

[19:45] Why it’s a good idea to self-manage your first deal

[24:23] Why you should explain your offer to the seller

[28:12] What’s next for Gino

  • Syndication

[29:29] Gino’s lightbulb moment

  • Realized he was wasting his time on mundane tasks
  • Left the restaurant industry

[35:00] Gino’s advice to a new investor

  • Find your reasons why
  • Focus on a market, get educated

[37:23] Why people want things but don’t act

  • Lack of a burning desire
  • Burning desire will lead to massive action
  • Example of Gino’s dad and the day he stopped smoking

[43:18] Favorite books

  • The One Thing
  • Rich Dad Poor Dad

Connect with Jeno:

jakeandgino.com

Twitter

Facebook

Resources mentioned:

Wheelbarrow Profits Podcast

Book: Wheelbarrow Profits: How To Create Passive Income, Build Wealth, And Take Control Of Your Destiny Through Multifamily Real Estate Investing


Vinney “Smile” Chopra shares his amazing journey from arriving to this country from India with $7 in his pocket to building a $70M multifamily real estate empire.  In this episode, we focus in particular on how he started his multifamily investing career and how he eventually raised $1.1M to do his first two deals.

After having graduated from George Washington University, Vinney became a mechanical engineer. He was fascinated by sales and marketing and sold encyclopedias and bibles door-to-door. For several decades, he was a professional fundraiser for non-profit organizations. He started investing in single family houses in the mid-eighties, but in 2007 he became passionate about multifamily investing. Since then, he’s done $125M worth of real estate transactions and currently controls over 1,400 units.

Vinney’s middle name is “Smile” because that what he did a lot during our interview. Here are the topics we cover on the podcast:

  • Why he decided to get started with real estate. Too much work! Couldn’t really scale.
  • His first venture into MF: hard!, it took 12 months. It seemed impossible. He ended up closing a 14-unit and then a 109 unit just several weeks afterward, raised $1.1M.

Key Takeaways:

[7:30] Vinney’s start in real estate investing

  • Started with single family housing
  • Planned on selling the homes to fund retirement

[12:47] Vinny’s preferred method of learning

  • Youtube
  • Google
  • Podcasts (12-15 per week)

[13:31] Why positive thinking is so important if you want to achieve your goals

[18:13] Why Vinney decided to stop investing in single family housing

  • Minimal economies of scale
  • Risk of 100% vacancy
  • After the crash of 2007 lenders would only loan on multifamily housing

[20:33] Why Vinney recommends finding a partner

  • Encouragement through the tough times

 [26:17] Why you should talk to a syndication attorney before raising money

[28:00] Vinney’s very first deal

  • 14 unites
  • Closed on 109 units soon after

[32:14] How Vinney raised money for his first deal

  • Hustled!
  • Decided not to accept money from friends or relatives
  • Designed a great presentation

[38:55] How one happy investor can lead to 30 more

 

Connect with Vinney

Phone: 925-766-3518 (call or text)

Email: vinney@moneilig.com

Vinney’s course on syndication: realestateu.tv


Learning how to find and analyze multi-family deals is important, but if you can’t afford to fund it yourself, you need a strategy for raising money! Doing what everyone else is doing to raise money is less and less effective, and that’s why I’ve invited Richard Wilson on the podcast to talk about raising money. Richard’s business isn’t just about raising money for real-estate, but we can adopt many of the strategies that Richard talks about to raise money for our multi-family deals!

About Richard Wilson:

Richard Wilson helps $100M+ net worth families create and manage their single family offices and currently manages 14 clients including mandates with three billionaire families. Richard is also the founder of the Family Office Club, the largest membership-based family office association. Richard hosts the "The Family Office Podcast", and he is the author of the #1 bestselling book in the family office industry, The Single Family Office: Creating, Operating, and Managing the Investments of a Single Family Office. He is a sought-after speaker and has spoken at over 150 conferences in 17 countries. Richard currently resides on the island of Key Biscayne, Florida with his wife and two daughters.

Enjoy the interview!

Key Takeaways:

[1:54] Definition of a Single-Family Office: Private company that manages investments and trusts for a single person or family.

  • Many wealthy people prefer to put their money back into operating businesses.

 [9:27] Richard’s experience raising money

  • Around 250 million raised

[9:56] Richard’s strategies for raising money

  • Stop pitching people. They don’t like it.
  • Start educating people. Provide real value to other people that are already in the game.

[13:02] There are experts in your niche that don’t compete with you but have enormous credibility. Find ways of efficiently connecting them to each other, (like through a podcast), and you will get Triple ROI:

  • Getting value out of their brain
  • You will gain a connection to this person
  • Now everyone knows your well connected and educated

[15:39] Richards advice on raising money from private investors.

  1. Analyze your competition and what you offer. Know what’s really going on in your industry.
  2. Identify your position so that almost no one can compete with you.
  3. Architect exactly how you will attract the people based on your unique
  4. Execution
  5. Iteration

[20:45]- When you layer communities, you create good luck.

[23:44] What Richard would do if he had only 500 bucks and a laptop (EO Fire Podcast question)

  • Position himself to own a checkpoint and find a way to control a critical resource.
  • Own something that is a bottleneck in your industry

[29:03] Special offer:

Resources mentioned:

Family Office Podcast: Real Estate Investments, Co-Investing, Capital Raising, and Private Equity Business Strategies: https://itunes.apple.com/us/podcast/family-office-podcast-real/id849850253?mt=2

 


In this episode, Mark Walker shares with us how he replaced his income from a high-tech job with passive income from multifamily properties. Like so many people I’ve talked with, Mark started with single family investing before realizing that multifamily investing would allow him to achieve his dream of financial freedom.

His path was not always easy but one day in Mark “decided” that he was going to achieve financial freedom and from that moment on he worked towards escaping the rat race. In my experience, once you truly decide to do something you can’t stop yourself from taking action! So decide already!

Mark has some great advice and he’s even got a free PFD that you can download entitled   “10 "Not So Obvious" Ways to Boost Your Multifamily Property NOI.”  You can download it here

Key Takeaways

[1:15] Mark’s Backstory

  • Worked for a high-tech company
  • Left his job in January of 2015 to become a full-time real estate investor

[3:38] The day Mark “decided” to achieve financial freedom

 [5:16] Why Mark started investing in condo’s and townhomes

  • Higher returns (post-tax)

 [6:05] Marks Hiatus from real estate investing

  • Defrauded on a deal

[9:10] Why Mark decided to shift strategy and start investing in multifamily

  • value-added opportunities with cash flow
  • Economies of scale
  • “The bigger the deal, the easier it is”
  • The way a multifamily property is valued

  [13:04] Why Mark decided to do bigger multifamily deals

  • Bigger payoff for time spent
  • Non-recourse financing that he couldn’t get on smaller deals

[14;13] Marks mental struggle transitioning from a W2 employee to a full-time real estate investor.

  • Had 36 units when he left his job
  • 6-12 months to get used to no regular paycheck

[17:4] What Mark would do differently if he could do it over:

  • Find a mentor/co-sponsor that is doing multifamily deals

[20:11] Why a very successful investor would be willing to partner with a noobie

 [23:10] Marks advice for a new investor

  • Never stop learning! “Learning leads to action and action leads to success”

Resources mentioned

Mark's gift to listeners: 10 "Not So Obvious" Ways to Boost Your Multifamily Property NOI

 


MB 048: How I Closed My First 22-Unit Apartment Deal in 3 Months (With Ed Hermsen)

For many of these episodes, I bring on someone who is already very successful in multi-family investing and I will continue doing so because there is a lot to learn from these people! However, I also really enjoy talking with relatively new investors about their first deal since that first deal is always the hardest, and it’s the most important step you can take towards achieving your financial goals.

This week, I welcome to the show Ed Hermson. In this episode, you will find out how Ed was able to close his first 22-unit apartment building deal just 3 months after getting started, and how long it will take for Ed to achieve his goal of $10,000 per month in passive income!

Key Takeaways

[2:26] Ed’s backstory

  • Worked in Mortgage Banking for 14 years
  • His commission pay structure made him nervous
  • 2008 was an eye-opening experience

[6:22] Why Ed decided to stop investing in single family housing

  • Not enough short-term income to justify the work/hassle

[7:36] Why Ed decided that Multifamily was a good fit

[9:36] What stops people, (including Ed), from getting that first deal done

[10:43] How Ed overcame his monetary limitations

[12:12] Why Ed decided to focus on smaller markets

  • Less competition

  [18:21] How Ed found his first big deal

  • The power of property managers and why you should be nice to them

[23:21] Why paying for an appraisal on an apartment complex is usually a waste of money

  • The Single Family Investing Mindset

 [24:29] Ed’s advice on building an investment team

  • Choose people with diversity of experience

[25:34] How you can find the time for multi-family investing while working full-time

 [36:53] Ed’s advice to new investors

  • Find 3-4 individuals that have skills/knowledge that you don’t have
  •  Start putting together sample deals with deal analyzer

[38:19] Why you should focus on building relationships with bankers and property managers (instead of just realtors)

Connect with Ed Hermsen

ed.hermsen@mtggroup.com


This week’s guest is Bill Manassero. Bill is truly one of the world’s good guys. He’s has done a lot in his life and most recently he spent 11 years as a missionary to orphans, abandoned and at-risk children in Haiti.

At the age of 60, Bill realized that he was closing in on the age of retirement and he wasn't financially ready for it! Other than a little money in an IRA account and social security benefits Bill didn't have a method of generating income. Being a Walmart greeter didn't appeal to him so he started looking for ways to generate passive income. After throwing out a few ideas, Bill chose real estate and he decided to go big. Bill’s goal is to control 1000 doors in 6 years. He’s 3 years in and is well on his way! 

Since finding some success in real estate Bill has decided to help others who like him are getting close to retirement and need to generate income. Bill started The Old Dawgs Network which began as a blog and is now also supported by a podcast!

In this episode, Bill shares his inspiring story as well as the "why" behind his goal. Bill has a very strong “why” and we discuss what that is for him and why it's so important you find your "why". I hope you all enjoy this episode as much as I did!

Key Takeaways

[8:41] Why Bill chose multifamily investing to generate income

[12:50] Why Bill decided to focus on multi-family over single family real estate investing

  • Economy of scale
    • 1 insurance policy, 1 loan etc. for multiple units
  • Less risk of 100% vacancy

[15:09] Factors Bill considered when assessing his first big deal

  • Identified key markets
    • Great job/population growth
    • Make sure the place has landlord-friendly laws
    • Rent to value ratio

[19:28] How Bill used the inspection process on his fist “big deal” to get a better price

[27:01] The importance of identifying your “why”

[31:13] How Bill broke down his big goal into manageable steps

  • Accomplished each step before moving on to the next

 [32:40] The importance of remembering that real estate investing is about more than just money

 [34:23] Why Bill decided to move into his apartment building

[37:48] The inspiration behind “The Old Dawgs Network”

Connect with Bill Manassero:

Old Dawgs REI Network

Twitter

Resources mentioned

Old Dawgs REI Network Blog

Old Dags REI Podcast


In Gary Keller’s book “The One Thing” he asks the following question; What's the ONE thing you can do such that by doing it everything else will be easier or unnecessary? In this podcast I pretty much talk about one thing, that’s getting your FIRST deal. No matter the size, after you’ve done your first deal, the subsequent deals will be much, much easier.


This week I’m joined by Brooks Everline from Hagerstown, Maryland. Brooks is Truck Driver with UPS and just did his first deal in March of 2016! Brooks started with a fourplex before moving on to some small apartment building deals. I get that when you have a full-time job, finding the time and energy to do your first deal can seem daunting, but that's no excuse! Brooks sais that all you need to accomplish something is to make sure that your "why" is stronger than your why not. I couldn't agree more!

Key Takeaways:

[8:20] Most of the time our biggest regret is not doing more, sooner.

[8:50] Strategies for finding your first deal

[23:20] Brooks second deal

  • The importance of constantly searching and making MANY offers

[27:21] The only thing stopping you from taking the first step is yourself

[30:20] Take your biggest, scariest task and do that FIRST

Connect with Brooks:

yournextplaceinvestments@gmail.com

Phone: (301) 465-9047


In this episode, I’m joined by Kathy Fettke, CEO and Co-Founder of the Real Wealth Network and host of The Real Wealth Show podcast. She is a frequent contributor to national news including CNN, CNBC, NPR, FOX News, CBS MarketWatch and the Wall Street Journal. Kathy is a lot of fun to talk with, and her story is both educational and inspiring. She has a ton of real estate experience in both single family and multifamily investing and has experienced some incredible highs and lows in her personal and professional life.

In this interview, she tells us about her husband coming home with the news that he’s been diagnosed with cancer with only six months to live and how she turned to real estate to pay the bills. She also tells us about a 92-unit apartment deal that looked oh so perfect, before turning into a nightmare. Kathy has been through and accomplished a lot and lucky for us she's more than willing to share what she's learned!

Key Takeaways:


[5:25] There's not just one Market Cycle

  • There are a lot of markets all with a different cycles
  • It’s the time to buy in some markets and time to sell in others

[7:27] The worst real estate markets right now

  • Wherever foreign investors have come in and paid all cash and driven prices up. Primarily big cities.

[9:14] Metrics to look for in a market

  • Job growth = population growth
  • Look for cities that are proactively creating jobs

[8:30] Some of the best real estate markets right now

  • Reno, NV
  • Pittsburgh, PA
  • Cleveland, OH

[16:21] The insurance clause you NEED to be aware of when your property is vacant

[17:48] The one thing you ALWAYS do right before closing on a property

  • The final walk through

[22:38] When something goes wrong, communicate more with investors! NOT LESS!

[24:58] - Trust your gut.

  • Even if the number look good, do a gut check

[26:24] What to look for in a Syndicator/Sponsor

  • A long, proven track record of success
  • Someone who has been through a storm or two... and survived

[34:28] Get your advice from people who have already done what you want to do

[41:51] There is no “happy ending”. We are here to grow

  • Your end goal shouldn’t be sitting on a beach for the rest of your life

Connect with Kathy Fettke

Realwealthnetwork.com | FREE to join

 

Direct download: MB_045-_Living_Life_to_the_Fullest_as_a_Real_Estate_Entrepreneur-2.mp3
Category:general -- posted at: 12:54pm EDT

The multi-family market is hot right now making it harder to find good deals. Finding a way to charge above market rents is one strategy that allows us to buy properties at market and still get the returns we are looking for.


There are various strategies for achieving this, but a relatively new one that has come to my attention is renting out properties on a short-term basis via AirBnB. This week Nav Athwal joins me to discuss this strategy and some things you need to think about before implementing it.


Key Takeaways


[4:43] AirBnB and how most hosts utilize the platform

  • Hosts rent out rooms and/or entire personal homes

[7:31] Alternative ways to use the platform

  • Buying properties for the exclusive purpose of renting through AirBnB
  • Renting out empty properties through AirBnB while you are unable or unwilling to use them for another purpose

[10:15] Where the short term rental strategy can work

  • Look for cities where AirBnB is already very active
  • Look for cities with favorable regulations toward short term rentals

[11:42] Scalability of this strategy

  • Not completely proven
  • Services like Pillow offer on demand concierge and property management

[13:46] Regulatory Uncertainty

  • Some cities are limiting short term rentals while others are outlawing them completely.

[15:36] Pro AirBnB cities

  • Seattle
  • Austin
  • MANY international cities

[19:22] Nav’s advice to real estate investors evaluating this strategy:

  • Make sure your ROI is higher than it would be for a long term rental
    • Factor in cost to manage
    • Factor in expected occupancy rate
  • Research the cities regulatory environment
  • Location- Is this a location that will attract travelers?

Resources mentioned

Blog Post: THE RISE OF THE PROFESSIONAL AIRBNB INVESTOR- https://www.realtyshares.com/blog/the-rise-of-the-professional-airbnb-investor/

Connect with Nav

Website: www.realtyshares.com
Email: nav@realtyshares.com
Twitter: @navathwal

 

Direct download: MB_044-_The_Rise_of_the_AirBnB_Multifamily_Investor-2.mp3
Category:general -- posted at: 12:39pm EDT

Ever wonder what SEC regulations apply to apartment building syndications? There is a lot to this subject and while it’s not crucial that you know everything, nor should you try, it is important that you have a basic understand of what’s involved and what to look out for.

This week I’m joined by SEC Attorney Steven Rinaldi who has been handling private offerings of securities for over 26 years. Steven is extremely knowledgeable and competent, and this episode is packed full of useful info!

Key Takeaways:

[2:25] Definition and example of a syndication
[5:00] The types of entities Apartment Building Investors should use for Syndication
[8:08] How to structure a deal
[10:31] Legal documents required for syndication:

  • Operating Agreement
  • Prospectus/Private Placement Memorandum (PPM)
  • Subscription Agreement
  • Form D. File this in the states where the investors are located (not the property)

[13:12] Advantages of Delaware LLC’s

  • Hard to break up
    • Discourages disgruntled investors from filing lawsuits
  • Delaware judges see these cases all of the time and are very familiar with business law
  • Get out of trouble for as little as 10K vs. 250K

[17:38] What makes an investor an “Accredited Investor”

  • Net worth of one million or more excluding their house, car and life insurance
  • Husband and wife with a salary of 300K or more, with every expectation that will continue
    • Or one spouse makes over 200k per year, (with every expectation that will continue)
  • Less common
    • Trust fund of more than 5 million, Corporation, Partnership or LLC worth more than 5 million
    • Banks, Broker/Dealers, Mutual Funds, Insurance, Small Business Development Companies

[19:18] What qualifies as a “Prior Relationship”

  • The SEC won’t define it

[21:10] How to go about advertising to accredited investors

  • Go to a broker/dealer that specializes in alternative investments

[21:52] The difference between advertising and networking

[22:37] The importance of doing a PPM

  • You are required to provide a PPM to all non-accredited investors
  • You want to provide a PPM to accredited investors because they can sue you for fraud for not disclosing all "material information"
  • If you don’t, and the deal goes sideways you could easily lose everything you have. In most states that includes your house and your kid's college fund.
  • In most states, you cannot discharge a securities law judgment or fraud judgment in bankruptcy
  • ALWAYS DO A PPM!

[26:43]- Time and cost of drafting an Operation Agreement and PPM

  • Three weeks for initial draft
  • Could be completed in as little as five weeks

[29:10] The basics of crowdfunding

  • You can advertise to non-accredited investors BUT pay attention to the rules
  • You must refund all money if you don’t hit your goal.
  • More work for an attorney, therefore, more expensive

Connect with Steven Rinaldi


Email: stevendrinaldi@msn.com

Website www.rinaldilaw.com

Phone number: 240-481-2706

 

Direct download: MB_043-_Interview_with_SEC_Attorney_Steven_Rinaldi-2.mp3
Category:Commercial Real Estate -- posted at: 7:32pm EDT

In the previous episode titled, "How to Expand Your Mind To Go BIG with Multifamily Investing," I make the argument that Bigger is Better. I stand by that, so please listen to that episode before you listen to this one!  However, if you go through the exercises laid out in that episode and still don’t feel comfortable with going big, I have a Plan B: duplexes


In this episode, I will lay out a plan for you to do a deal on a duplex in 90 days. And if that's what it takes for you to get into multifamily investing, then DO IT. Buy that duplex. Will you retire from it? No, but at least you're in the game.

Key Takeaways:

Why Duplexes Are the Perfect Way To Get Started With Multifamily Investing

[3:22] Reason # 1: There's more of them and they're easier to find

[4:39] Reason # 2: You need less money

  • Even if you need to raise the money you won’t need near as much

[5:01] Reason # 3: They're easier to analyze
[5:19] Reason # 4: You don't need to build a huge team
[6:06] Reason # 5: Cash flow per unit tends to be better than for larger MF properties

  • Easier to see $200-300 per month, per unit in positive cash flow

[7:05] Vision setting is important but don’t let your vision stop you from achieving your goals

  • Set achievable 90-day goals
  • 90 day goals are long enough to achieve something meaningful but short enough for you to see it happening
  • Set goals that you can achieve if you hustle.

[8:08] 90 day plan to buying your first duplex

[8:51] Week 1: Educate yourself

  • Read books
  • Take courses - Find mine HERE: http://www.ultimateapartmentinvestingguide.com/
  • Attend a seminar

[9:35] Week 2: Determine investing area

  • Less important than in larger multifamily investing

[10:27] Week 3: Analyze 5 deals

[15:33] Criteria:

  • What are the comps?
  • Rent analysis by location
    • Rentometer.com
  • What’s the cash on cash return?

[17:58] Week 4: Start raising money

[19:04] The Last two months

  • 1 investor meeting per week
  • Make 5 offers per week
  • Your goal is to get ONE accepted

 


It’s just me on this episode and I want to talk with you guys about mindset. Expanding your mind is something help you achieve your goals in the fastest way possible. Staying within your comfort zone can do the opposite.

In this podcast I outline 5 Reasons why bigger is better with apartment building investing and then give you 3 practical ways to expand your comfort zone, so you can do more/bigger deals.

Key Takeaways:

[0:30] We limit ourselves based on what we believe is possible.

[3:14] Buying an apartment building twice as big really doesn’t add that much work.

5 Reasons Why Bigger is Better with Apartment Building Investing

[4:18] Reason # 1: A Much Better Buying Experience

  • The smaller you go the more of a pain it will be.
  • Less sophisticated sellers

[4:55] Reason # 2: Economies of Scale.

  • You can spread out the cost of management/maintenance over more units.

[5:25] Reason # 3: Less closing costs as a percentage of the deal

  • Many flat rate fees

 [5:55] Reason # 4: Better financing

  • Non-recourse loans. The larger the loan the less likely you will have to personally guarantee it.
  • Larger loans are cheaper. Interest rates go down and terms get better.

[6:40] Reason # 5: Bigger Profits for less work

  • Would you rather buy 30 houses or one 30 unit building?

 

3 Practical Ways to Expand Your Comfort Zone (So You Can Do More Deals!)

[10:31] Tip # 1: It all starts with visualization

 [12:01] Tip # 2: Create a sample deal package.

  • Look at deals that are outside of your comfort zone. (More units).

[13:43] Tip # 3: Visit properties that are outside of your comfort zone

  • Visit 3-4 properties over the period of 1 week

Mentioned in this Podcast:

Book: The Miracle Morning

eBook: The Secret to Raising Money To Buy Your First Apartment Building

Movie: The Secret


I’m doing something a bit different with this episode and I think you are going to really enjoy it. While I realize that the name of this podcast is “Apartment Building Investing” it’s good for us to expand our minds and see what else is out there.

Today I’m joined by Jefferson Lilly to talk about mobile home park investing!

Jefferson Lilly is a self-made millionaire mobile home park investment expert, educator, and industry consultant. Prior to co-founding Park Street Partners in 2013, Mr. Lilly spent seven years investing his own capital acquiring and operating his own mobile home parks. Before becoming an investor full-time, Jefferson spent nine years in sales leadership roles with several venture-backed startups in Silicon Valley. Jefferson has been featured in The New York Times, Bloomberg Magazine, and on the 'Real Money' television show. He holds a B.A. from the University of Pennsylvania and an MBA from the Wharton School of Business.

 

Key Takeaways:

[6:58] In the mobile home business, you want to own the land, not the homes. “Be in the real estate business. Not the wheelestate business.”

[8:08] Owning the land only, cuts out the vast majority of repair and maintenance that you are responsible for.

[8:53] What to look for when investing in mobile home parks.

  1. Look for properties that have no website and are undermanaged.
  2. Buy a park that is on municipal water/sewer.
  3. Make sure rents are going to remain relatively consistent.
  4. Look at parks within 5-10 miles of a Super Walmart.

[13:19] What to look for in an onsite mobile home park manager:

  1. Someone that has lived in the community for a while
  2. Someone who owns their own home
  3. Someone that keeps their home looking sharp.

[20:22] People tend to treat the park and their homes with more respect the father north you go (in the U.S.).

[22:16] When starting out, be hands on for the first 6 months. After that, think about outsourcing tasks.

[25:05] Income streams from Mobile home parks:

  1. Leasing the grounds.
  2. Selling mobile homes, via rent to own agreements.

[26:13] Common financing options for mobile home parks:

  1. Region banks (most common)
  2. Seller financing (preferred option)

[30:44] Primary ways to find deals:

  1. Brokers
  2. Direct outreach

[34:09] Why mobile home parks can offer great upside:

  1. Less competition in certain areas of the country.
  2. Not a “sexy” investing option.

 [38:38] Ways to invest in mobile home parks:

  1. Do it yourself.
  2. Invest through a fund like Park Street Partners.

 

How to Connect with Jefferson

www.parkstreetpartners.net

Podcast: Mobile Home Park Investors

MobileHomeParkInvestors.net

 

http://www.lillyandcompany.net/


MB 039: Don't Think You Can Do Your First Apartment  Deal (Then Listen To This)

This episode is a bit different than the norm because I am the one being interviewed! JP Moses with realestatemogul.com interviews me about apartment building investing and raising money.

I talk a bit about my journey, the struggles I’ve had and why many people dismiss apartment building investing as a wealth creating strategy for themselves. We discuss the myths and realities of getting started with apartment building investing and how to overcome the initial roadblocks.

 

Key Takeaways:

[4:02] Success is riddled with mistakes and failures

 [6:02] You have to be willing to operate in an environment where you can’t control everything and be at peace with that.

[11:59] Key components that make a deal worth doing.

[13:24] Why there is less speculation in commercial real estate than in single family investing.

[13:56] Very few great deals are going to be in your backyard.

[14:10] The best way to find deals in through relationships with brokers.

 [16:35] Loopnet.com is useful in finding brokers to start relationships with.

[20:14] People dismiss apartment building investing for these 3 reasons:

  1. I don’t have the money.
  2. I don’t have the experience.
  3. It’s so overwhelming I don’t know where to start.

[21:40] Flipping houses or investing in single family doesn’t give you credit when it comes to investing in multifamily dwelling.

[22:25] If a broker is asking you qualifying questions they’ve already classified you as a newbie.

[27:00] Even in stable apartment building investments you need to be interacting with your property manager on a consistent basis so you don’t lose touch.

[31:45] The right way to introduce yourself to a broker.

[34:55] Putting together a sample deal for potential investors.

[45:37] How to make money on deals you can’t pull the trigger on yourself.

[48:29] Don’t spend money in the due diligence process until you are 98% sure you are going to get the deal done.

[53:04] Invest in your education. Everything else can be achieved with hustle.


There are many advantages to investing in multifamily over single family rentals and this week I’m joined by a guy that has invested a lot in both.

Rod Khleif has been a real estate investor for the past 25 years has owned over 2000 apartments and homes. Rod shares his fascination real estate investing journey and how he built a HUGE single family house investing business which kicked his butt during the recession. Rod gives us the pros and cons of Single Family Vs Multifamily investing and discusses why he thinks a correction is coming and why multifamily’s are the best investment right now.

But ask Rod what he is most proud of, and he will tell you about his work as a community philanthropist. Over the past 14 years, Rod’s work has benefitted more than 40,000 underprivileged community children.

Rod has a new book, coming soon, on the topic of multifamily investing and listeners of this podcast can get it for FREE by texting “Rod” to 41411. Rod hosts a new and already popular podcast called the Lifetime Cashflow Podcast.

 

Key Takeaways

[3:58] Single-family rentals either are rented or they are not. With multifamily dwellings, you can typically cover your expenses, even with a vacancy.

[6:03] Learn a business, and confidence and the ability to influence people will follow.

[7:30] Always be learning. Regardless of how much you know, there is always something to learn.

[10:28] To be good at investing, you need to learn to love it.

[10:47] Learn to find positives in negative situations

[14:24] Pros and cons of Multifamily investing

[18:08] The beautiful thing about multifamily is it’s valued based on the net operating income NOT comps.

 [19:34] By improving net operating income you can exponentially raise the value of an apartment building.

 [21:53] Financing on large deals can be easier to secure, with better terms.

[25:01] It’s easier to scale multifamily investing than single family.

[27:12] You can become finically free with ONE transaction in multifamily. It generally takes dozens of single family deals to accomplish the same thing.

[30:16] If you’re willing to do what others don’t do, you will be a success.

[37:09] The importance of visualizing your goals.

[39:47] Know the “why” behind your goals.

 

Mentioned in this interview:

  • Rod's Podcast is the Lifetime Cashflow Podcast: http://www.lifetimecashflowpodcast.com/
  • Rods new book all about multi-family real estate investing: Text “Rod” to 41411 and get the book FREE when it’s released.
  • Connect with Rod Khleif

The best way to connect with Rod is via email at rod@rodkhleif.com


About 98% of the people that come to me are not aware that they can invest in real estate from their RIA or 401k. Investing with your IRA or 401k brings enormous tax advantages, and therefore growth advantages, but there is quite a bit you need to know before you get started.

This episode is part 2 of my interview with Attorney, Accountant, and Real Estate Investor John Hyre. In this episode, John covers a few advantages and disadvantages of various retirement investing plans and the pitfalls of prohibited transactions which can easily blow up your IRA and cost you 50%-60% of the account value.

John has a course on this topic that I have reviewed on my website: http://www.themichaelblank.com/ira. For a limited time, John is offering this course and the live conference footage (discussed in this episode) for only $1,197 (Regular Pricing: $2,391).

Key Takeaways:

[3:42] An IRA is the biggest loophole out there.  The best way to deal with income is to make it not taxable to begin with. 

[10:59] Roth IRA VS a traditional IRA

[11:33] It’s much better to be taxed on the seed now then the crop later.

[12:02] Self-directed 401K’s are superior to traditional IRA

[12:15] The value/importance Health Saving Accounts (HSA) and Coverdell Education Savings Accounts (CESA) are often underestimated.

[14:30] Why you should set up an HSA TODAY

[15:39]- why 401K’s are “infinitely superior” to IRA’s. Penalties for prohibited transactions are MUCH worse for an IRA.

[19:45] The power of tax-free investing.  

[26:26] Prohibited transitions in IRAs- what makes them so scary. Don’t just be conservative, be Paranoid.

[33:32] Statue of limitations on prohibited transactions (NEW)

 

 

Mentioned in this interview:

IRA Investing: Review of the Tax Litigators Guide to Tax-Free IRA, HSA & CESA Wealth by John Hyre- Special Limited Time Offer:  Buy  the course + live conference for just $1,197 (Regular Pricing: $2,391)

Purchase here: http://www.themichaelblank.com/ira

 

 

Connect with John

Iralawer.com

Realeastatetaxlaw.com

 

 


Bookkeeping is often an overlooked, underappreciated part of business for new investors. However, if you don’t understand your books and your business entity you are probably losing a lot of money, and not just during tax time.

John Hyre is an Attorney, accountant and real estate investor, (in that order according to him), and he was kind enough to join me on the podcast to talk about choosing and maintaining a business entity and the importance of keeping your books the right way. John even has a class on both topics, and the two can be purchased together here for just $499: www.themichaelblank.com/hyer

The information packed into this episode can save you a lot of pain, suffering and money.

 

 Key Takeaways

[3:10] Biggest mistake that business owners make is the failure to document. If you can’t prove it, you can’t claim it.

[4:35] Use Quickbooks instead of Quicken. Reason; Real estate investing is a balance sheet intensive business and Quickbooks is better suited for that than Quicken.

[5:45] Doing your books the right way saves you money on the front and back end. It lowers your overall tax bill and saves your accountant time, and therefore you money.

[6:07] The books tell you how the business is doing. If you’re not keeping them correctly, you probably don’t know how your business is actually doing.

[6:42] You can delegate bookkeeping, but you need to know about what goes into the books and what you should see to know that whoever is doing it, is doing them correctly.

[9:03] The best insurance against an IRS audit is the bookkeeping and record keeping.

[10:01] Pay your kids to do work for you like scanning receipts. It’s a tax write-off and the money stays in the family. (More on this later in the episode).

[12:03] An LCC is like life insurance.  You want it if you need it, but you want to keep the probability of needing it as low as possible.

[13:50] You can avoid a lot of lawsuits by being nice to people.

[14:41] Entities are like children; Fun and easy to make but a lot of work once you got one.

[15:00] The #1 way to destroy an entity is to co-mingle money.

[16:40] Generally the best entity to use for apartment building investing is an LLC

[20:08] Once you involve someone who you are not married to as a partner, you will want a lawyer to write a customized operating agreement. Don’t use a template.

 [27:28] If you want a court to treat your LLC like a business, you need to treat it like a business.

[28:18] Rules & guidelines for paying your kids.

[46:32] Trust law is much more complicated than entity law.

 

Mentioned in this episode:

Entity Selection Course, Bookkeeping course: www.themichaelblank.com/hyer

-purchase for 299 each or 499 together

Iralawer.com

 

Connect with John

Iralawer.com

Realeastatetaxlaw.com

 

Direct download: MB_036-_How_to_Pay_Less_Taxes_With_John_Hyre-2.mp3
Category:Commercial Real Estate -- posted at: 3:28pm EDT

MB 035: Just Do It (And Figure It Out Later) – With John Cohen

It’s never too early to get started.


This week I’m joined by John Cohen who is just 29 years old and is the President of JC Property Group Inc., a company he formed in early 2013. John played college baseball and graduated with a degree in Economics from Queens College. Fresh out of college John started a job as a stock broker at Morgan Stanley and quickly realized that it wasn’t the path for him.


He switched his focus to real estate and quickly found that making money on tax deed properties wasn’t as easy as he’d hoped. He then joined Marcus & Millichap and became a successful commercial broker, all the while buying properties for himself, before leaving the company to focus 100% of his time on the growth of his company.

Key Takeaways:


[6:03]- The moment John realized that finance wasn’t what he wanted to be doing.
[9:23] People say they want to become a millionaire and retire early, but they don’t really decide that’s what they are going to do.
[9:48] How John got into tax deeds without knowing what he was doing and purchased two worthless pieces of land.
[16:04] John’s tax deed properties strategy
[17:45] Transitioning from tax deed buys to multifamily units
[23:52] Getting that first deal
[30:10] Strategies and tactics to finding deals.
[34:00] Direct mail: it’s not what you write, it’s the consistency
[43:11] John’s biggest aha moment- Don’t take things for granted. You have to work for what you want.
[47:10] Best Habits: Get up early, do the hardest things first.
[48:18}- Best Resource- People. Reach out to people that can help you. Meet with them instead of calling. Call them instead of texting.
[49:44] You need to find a mentor. Don’t stop until you find that person.

Connect with John


Cell:
Email:


MB 034: Do THIS to Get Into Your First Multifamily Deal (With Keith Weinhold)

“Dream big but start small.”  Today, it doesn’t take much to get started in real estate investing and in this episode you will find out just how little it takes to get into your first multi-family unit.

I invited Keith on the show to discuss how he got into multifamily investing by moving into his first home he ever bought: a 4-plex. Over the years, Keith has added to his portfolio and is now a full-time investor.

 

Keith is the Founder of Get Rich Education to teach others about the life-altering power of investing, especially through real estate. He hosts of one of America’s top investing shows - Get Rich Education - with thousands of listeners in over 160 world nations. He’s heard everywhere from iTunes to iHeartRadio, and regularly hosts Kiyosaki Rich Dad Advisors as guests.

 

Key Takeaways:

[3:19] You CAN move to a location that you dream of living in instead of moving wherever there’s a job.

[9:00] Sometimes we need to “unlearn” before we can learn

[10:40] How Kieth Got started with an FHA loan (it’s still available TODAY)

[16:55] Forget about compounding, the key is Leverage

[22:09] What to look for to make sure you “buy right”   

[25:50] How to find the best listings

[29:16] What to look for in a property manager. What to look for in the “Interview process.”

[32:57] ROTI- “Return on Time Invested” is a metric you need to think about when it comes to self-managing your properties.

[35:32]  Advise from Keith. If he could do it all over again, what would he do differently?

[38:57] How to think about debt: Outsourcing to tenants.

 Mentioned in this interview:

Mentioned in this interview:

Favorite books:

1] Rich Dad Poor Dad: Rich Dad Poor Dad- by Robert Kiyosaki

2] Loopholes of Real Estate- by Garrett Sutton

Online resources: www.16personalities.com

 

Connect with Keith:

ww.getricheducation.com

Keiths Podcast: Get Rich Education - https://itunes.apple.com/us/podcast/get-rich-education-keith-weinhold/id927263663?mt=2

 

 http://traffic.libsyn.com/michaelblank/MB_034-_Do_THIS_to_Get_Into_Your_First_Multifamily_Deal_-_With_Keith_Weinhold.mp3


MB 033: The Definitive Guide to Investing in the U.S. From Abroad With Reed Goossens

Michael gets a lot of interest from all of you international investors who want to invest in the U.S. but there are a lot of questions that need to be answered before you can close that first deal. Like, what do I need to set up? Can I invest in apt buildings and if so, how? What are the tax considerations?

In this episode, Michael is joined by Reed Goossens, who answers those questions and more!

Reed is from Australia and moved to the US 4 years ago. He's a civil engineer by trade but wanted to get out of the rat race and started to invest in multifamily properties in the U.S.  But he faced all kinds of difficulties investing here as a foreigner but finally figured it out. Now he's looking for apartment building deals all over the U.S. He hosts a podcast called " Investing In The U.S. - An Aussie's Guide to U.S. Real Estate" where he teaches people how to invest in the U.S. from abroad.

Connect with Reed:

Website: http://www.rsnpropertygroup.com/

Email: reed@ rsnpropertygroup.com

Podcast: https://itunes.apple.com/us/podcast/investing-in-u.s.-aussies/id1071004776?mt=2

 

 http://traffic.libsyn.com/michaelblank/MB_033_-_The_Definitive_Guide_to_Investing_in_the_U.S._From_Abroad_With_Reed_Goossens.mp3


MB 032: Everything You Need to Know About Crowdfunding

Michael welcomes to the podcast Nav Athwal, the founder and CEO of RealtyShares. RealtyShares is one of the oldest and largest companies out there in the relatively new and exciting market of real estate crowdfunding.

Nav has drawn from his diverse and impressive background to build RealityShares into a market leader. Nav was once worked an electrical engineer, then for a raw land developer and then became a land-use attorney before starting RealtyShares from his living room! It’s not in his living room anymore. RealtyShares has now raised almost 150 million with a diverse set of operators located in over 60 markets!

Most of us are pretty aware of the basics of crowdfunding and the advantages it creates in the marketplace. So instead of painting in broad strokes, Michael and Nav get into the nuts and bolts of RealtyShares and what that means to you, the listener. In this show they cover the following:

  • Investor qualifications – (these standards may be loosened soon)
  • Investing minimums
  • Investing opportunities
  • Raising capital through real estate crowdfunding
  • RealtyShares ability to provide the ENTIRE capital stack
  • Preferred Returns
  • And much, much more

 

RealtyShares  Website: www.realtyshares.com

RealtyShares contact info:

Email: contact@realtyshares.com

Twitter: @realtyshares

 

 

Nav Athwal contact info:

Email: nav@realtyshares.com

Twitter: @navathwal

Direct download: MB_032-_Everything_You_Need_to_Know_About_Crowdfunding.mp3
Category:Commercial Real Estate -- posted at: 4:44pm EDT

Direct download: John_Hyre_Highlight_Audio.mp3
Category:general -- posted at: 4:21pm EDT

This episode is all about doing due diligence on commercial real estate.

Due Diligence is rarely talked about because it takes back seat to sexier topics like raising money and finding, analyzing and negotiating deals.

But I have found that more investors make mistakes during the due diligence than any other part of the process.

To help us with due diligence I have on the show today Brian Hennessey.

Brian has been in the commercial real estate industry for 31 years as: a commercial broker for 22 years; a Senior Vice President of Acquisitions and Dispositions for 6 years for a major investor, and ran his own real estate syndication/asset management company for 3 years. He has represented a number of Fortune 500 Tenants including Bank of America, The Walt Disney Company and Baxter Healthcare.

With over 9 million square feet of sale transactions, many painful, but valuable lessons were learned and a wealth of experience was accumulated. 

He is the author of the book “The Due Diligence Handbook for Commercial Real Estate Investments”, a top selling
book on commercial real estate available on Amazon, Audible.com and on his website www.impactcoachingsystems.com.

He's going to share with us the Top 10 Mistakes people make when doing due diligence on commercial real estate.

So it's important to pay attention to what Brian has to say.

Here are the complete show notes and transcript:

http://www.themichaelblank.com/session31/

Direct download: MB_031.mp3
Category:general -- posted at: 8:14pm EDT

I heard of two deals recently that ended up going south after the lender apparently did not come through with the loan. Upon closer inspection, though, it was ignorance by the sponsor about how the lender would underwrite the deal, i.e. how they would value the asset and determine the LTV, for example. Or what they require of the sponsor. Or that they require (gasp!) a capital reserve at closing.

All of these materially alter the deal and need to be understood upfront.

To avoid these mistakes, it's imperative that you "interview" your commercial mortgage brokers so that you understand how they underwrite deals and they will require of you. Then you can incorporate those assumptions into your financial model (i.e. the SDA) and you won't be taken by surprise a few weeks before closing.

In my course "The Ultimate Guide to Buying Apartment Buildings with Private" I have a list of 10 questions to ask your commercial mortgage brokers. What I wanted to do in this episode is actually interview a broker and ask them the 10 questions.

That way, you know the questions to ask and you'll also get an idea of what answers  you can expect.

To help us with this exercise, I have on the call Ira Zlotowitz, founder and president of Eastern Union Funding and Shai Romirowsky, VP at Eastern Union Funding.

Here are the complete show notes and transcript:

http://www.themichaelblank.com/session30

Direct download: MB_030-REVISED.mp3
Category:general -- posted at: 8:12pm EDT

Direct download: MB_029.mp3
Category:general -- posted at: 10:33am EDT

Direct download: MB_028_10_Practical_Tips_To_Achieve_Your_Goals_This_Year.mp3
Category:general -- posted at: 2:42pm EDT

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