Financial Freedom with Real Estate Investing

“When you pay somebody that’s been where you want to go, you’re buying WISDOM without the WAIT.”

If you want to succeed as a multifamily real estate investor, your best bet is to take advantage of free resources for a basic education and then find someone you know, like and trust who is willing to mentor you—even if you have to pay for their time.

Larry Goins is a veteran real estate investor with 20-plus years of experience in the space. He travels the US speaking at conventions and expos, sharing his strategies for buying a dozen properties every month—without leaving his office! Larry is also the president of both Investors Rehab and The Goins Group, and he hosts the popular real estate podcasts BRAG Radio and Brain Pick-A-Pro. Larry is committed to holding true to his moral integrity in his business and personal life.

Today, Larry sits down with me to offer advice for aspiring investors around finding a mentor and ‘accelerating the splat’ when necessary. He shares his favorite real estate strategies and explains how he has systematized his business around seller financing and lease option models. Listen in to understand what motivates Larry to continued success in real estate and learn how he pays it forward by putting people and principles BEFORE profits!

Key Takeaways

How Larry got his start in real estate

  • Always wanted own business
  • Tom Vu real estate seminar
  • Bought first house in 1986

Larry’s favorite real estate strategies

  • Seller financing
  • Lease option

How Larry has systematized his business

  • Buy house ‘fit and safe’
  • Landlord/tenant relationship
  • Lease option model

Larry’s advice for aspiring investors

  • Get education (podcasts, blogs and YouTube)
  • Find coach or mentor
  • ‘Education is not application’

Larry’s concept of accelerating the splat

  • Pleasure vs. pain motivation
  • Recognize time to move on

What motivates Larry to success in real estate

  • Dad passed in 1984, wanted to help mom
  • Be Rich and Generous

How Larry puts people and principles before profit

  • Advise against lending for bad fix and flip
  • Relationship driven (vs. transaction driven)

What gets Larry out of bed in the morning

  • Loves the chase, thrill of negotiating deals
  • Impart expertise to students

Connect with Larry

Larry’s Website

BRAG Radio Show

Brain Pick-A-Pro Podcast

Resources

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Deal Maker LIVE

Michael’s Website

Podcast Show Notes

Review the Podcast on iTunes

Direct download: ABI_132.mp3
Category:Commercial Real Estate -- posted at: 1:52pm EDT

If you’re early in your career as a multifamily syndicator, a qualified team is essential in overcoming your lack of experience to go after larger, more lucrative deals. But how do you attract and align your interests with those prospective team members? And once you’ve established a track record of your own, how do you stay in front of your investors and continue to scale your money raising efforts?

Joe Fairless is Managing Partner with Ashcroft Capital, a national multifamily investment firm focused on major metropolitan areas. Joe has been investing in real estate since 2008, and to date, he controls more than $400M of real estate in the Houston and DFW regions. Joe is also the host of the popular daily podcast, Best Real Estate Investing Advice Ever, and the author of several books on real estate investing, including the newly released Best Ever Apartment Syndication Book.

Today, Joe joins me to discuss his impetus for writing the Best Ever Apartment Syndication Book and explain his belief in the Law of Reciprocity. He shares several of the advanced aspects of syndication outlined in the new book, including 4 ways to align interests with team members and pursue larger deals early on—in a safe way. Listen in for Joe’s insight on multifamily as a partnership business and learn his intentional system for staying top-of-mind with investors, adding value in a variety of ways on a regular basis!

Key Takeaways

Why Joe wrote the Best Ever Apartment Syndication Book

  • Help investors understand how operations work
  • Not beginner’s guide, need fundamentals first
  • Get message out to help others (Law of Reciprocity)

Joe’s 4 ways to gain credibility through aligned interests

  1. Attract qualified team member (i.e.: property manager)
  2. Give team member equity stake of 5-30%
  3. Team members bring equity to deal
  4. Team members bring own money + investors

Joe’s insight on real estate as a partnership business

  • Maximum return on time and money
  • Align with experienced team early on
  • Leverage track record of partners
  • Larger deals in fast, safe way

Joe’s approach to staying top-of-mind with investors

  • Daily podcast/blog (audio)
  • Weekly email recap of content (visual)
  • Monthly report mailed to accredited investors
  • Quarterly happy hour, dinners (in-person)
  • Annual Best Ever Conference

Connect with Joe

Joe’s Website

Best Ever Show

Ashcroft Capital

Email info@joefairless.com

Resources

Best Ever Apartment Syndication Book by Joe Fairless and Theo Hicks

The Tim Ferriss Show

The 4-Hour Workweek: Escape the 9-5, Live Anywhere, and Join the New Rich by Timothy Ferriss

Carlos Vaz at CONTI

Best Ever Conference

Kathy Fettke at Real Wealth Network

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Deal Maker LIVE

Michael’s Website

Podcast Show Notes

Review the Podcast on iTunes

Direct download: ABI_126-Joe_Fairless.mp3
Category:Commercial Real Estate -- posted at: 12:52pm EDT

Are you still skeptical of the idea that you can build a real estate business using other people’s money? Or, maybe you don’t think that your network has access to the kind of capital you would need for a multifamily investment. Matt Faircloth argues that you simply don’t know where to look, and he is living proof that with the right approach, you can develop a robust real estate portfolio by raising private capital.

Matt is the co-founder of The DeRosa Group, a real estate investment firm headquartered in Trenton, New Jersey. Matt and his wife, Liz, have been investing in real estate since 2004, and they have vast experience with single family, multifamily, office and retail properties. Matt’s firm has completed more than $30M in real estate transactions involving private capital, and he is the author of Raising Private Capital: Building Your Real Estate Empire Using Other People’s Money.

Today, Matt joins me to share his journey from house hacker to full-time real estate investor. He offers insight around taking capital from friends and family, educating your network on where to find the money to invest, and aligning with a seasoned partner. Listen in to understand the three different investment opportunities Matt offers through DeRosa Group and learn his transparent, jargon-free approach to raising capital.

Key Takeaways

Matt’s introduction to real estate

  • Rich Dad Poor Dad, CASHFLOW Board Game
  • House hack to pay off student loans

Matt’s transition to full-time real estate investor

  • Reduce expenses to live below means
  • Strategic decision to delay having kids

Why it took Matt several years to find his niche

  • No solid set of attainable goals
  • Distracted by shiny objects

Matt’s shift to raising money from investors

  • Refinanced portfolio to get cash for next deal
  • ‘Carousel stopped’ after crash

Matt’s insight on taking money from friends and family

  • Offer value, confident in returns
  • Allow people care about to benefit

How to overcome a lack of track record

  • Align with seasoned partner
  • Start small, work up to bigger projects

Matt’s advice for aspiring investors looking to partner

  • Don’t solicit free advice
  • Put other person first and CONTRIBUTE

The three investment options Matt offers

  1. Single family fix and flips (short-term capital)
  2. Turnkeys (100% ownership)
  3. Multifamily syndication for passive investors

The argument for real estate investment over other asset classes

  • Leverage tax deferment through IRA for fix and flips
  • 8 to 10% yields, compound over and over
  • Tax benefits of owning via syndication or turnkey

Matt’s approach to raising capital

  • Avoid speaking in jargon, keep it simple
  • Explain how money protected
  • Discuss if, thens (worst case scenarios)

Where to find money in your own network

  • Homeowners that qualify for HELOC
  • Leverage retirement accounts

Matt’s three tiers of raising capital

  1. Local contacts
  2. Referrals, networking groups
  3. National voice as thought leader

Connect with Matt

DeRosa Group

DeRosa Group on Facebook

DeRosa Group on YouTube

Matt on Bigger Pockets

Resources

Raising Private Capital: Building Your Real Estate Empire Using Other People’s Money by Matt Faircloth

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not by Robert T. Kiyosaki

CASHFLOW Board Game

Deal Maker LIVE

Review the Podcast on iTunes

Direct download: ABI_130_v2.mp3
Category:Commercial Real Estate -- posted at: 11:54am EDT

What could possibly go wrong? If you are the proud owner of a multifamily property, the answers range from minor falls to catastrophic weather events. How can you mitigate the risk and reduce your total number of claims? And what kind of multifamily insurance coverage do you need to manage the circumstances outside your control?

Bryan Shimeall is the Vice President of Multifamily Risk Advisors, a division of Tanner, Ballew and Maloof formed to leverage the firm’s 20-plus years of experience handling insurance for the multifamily industry. Bryan is dedicated to delivering customized solutions that mitigate risk for apartment building investors, and he is an expert in the realm of risk assessment and exposure to loss.

Today, Bryan sits down with me to share his definition of and approach to risk assessment. He discusses the most common gaps in multifamily coverage, the most common property and liability claims, and the best strategies for mitigating risk. Bryan also explains when to pursue a master policy and the fundamentals of catastrophic coverage. Listen in for insight on the benefits of working with a risk management consultant and learn what to look for in a multifamily insurance policy!

Key Takeaways

The role of Multifamily Risk Advisors

  • Insurance services for multifamily industry
  • Boutique shop in business 20 years

Bryan’s definition of risk assessment

  • Process of identifying inherent risk of property
  • Includes property and liability

Bryan’s approach to risk assessment

  • Age and condition of property
  • Construction type and location
  • Look at seller’s historic losses

The most common gaps in coverage

  • Catastrophic hurricane deductibles
  • Denial that managing risk will mitigate claim

How operators can manage risk

  • Routinely walk property
  • Keep up with deferred maintenance
  • Update AC units

The most common claims

  • Liability—wet conditions, loose handrails cause falls
  • Property—small oven fires

The disadvantages of the ‘trailing 12 premium’

  • No reason to look at number for guidance
  • Don’t know how owner has insured property

The benefits of working with a risk management consultant

  • Knowledge, experience and relationships
  • Specialize in multifamily, understand mechanics

How Multifamily Risk Advisors can assist during the acquisition phase

  • Ask for OM on property (square footage, construction type)
  • Respond quickly with real insurance costs for property
  • Identify other issues (i.e.: budget money for roof replacement)

When to pursue a master policy

  • No raw number (≈1K units)
  • Geography is most important factor
  • Uniform deductible, renewal date
  • Allows for predictability

The fundamentals of catastrophic coverage

  • Windstorm deductible in coastal areas
  • Hailstorms in Midwest reflected in rates

The most common mistake among investors

  • Pay attention to premium but not deductibles

Connect with Bryan

Multifamily Risk Advisors

Email bshimeall@multifamilyra.com

Resources

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Deal Maker LIVE

Michael’s Website

Review the Podcast on iTunes

Direct download: ABI_129_v2.mp3
Category:Commercial Real Estate -- posted at: 9:12pm EDT

As an aspiring real estate investor, you possess a spirit of independence as well as a desire for financial freedom. What if you could take that self-determination to the next level and essentially become your own bank? Patrick Donohoe is on a mission to teach you how to take control of your money with the Perpetual Wealth Strategy, taking advantage of a particular kind of life insurance policy to facilitate real estate investment, secure retirement funds, and build a legacy that you can pass on to your children.

Patrick is the president and CEO of Paradigm Life, a financial services firm committed to changing the way their clients look at life and wealth. The Paradigm team supports thousands of individuals and businesses in creating income for life and leaving a meaningful legacy. Patrick is a sought-after speaker in the realm of wealth management and investment, and he serves as the host of The Wealth Standard podcast. He is also the author of Heads I Win, Tails You Lose: A Financial Strategy to Reignite the American Dream.

Today, Patrick joins me to share the benefits of the Perpetual Wealth Strategy and explain how it serves as the foundation for fulfilling the true American Dream. He offers insight around how a specifically-designed whole life insurance policy works, why its interest rate is so much higher than a savings account, and how the policy gives you a line of credit to borrow against for investment purposes. Listen in for Patrick’s advice around leveraging the Perpetual Wealth Strategy to generate passive income, pass on a legacy, and take control of your wealth—the way the rich do!

Key Takeaways

How Patrick came to start his business

  • Mentored by Rich Dad advisor Kim Butler
  • Stuck it out after partnership wiped out in 2008

Patrick’s definition of the American Dream

  • Independence and freedom
  • Greatest wealth built within person

The benefits of the Perpetual Wealth Strategy

  • Whole life insurance policy with mutual company
  • Designed for cash value accumulation
  • Provision for insurance to give line of credit
  • Grow without taxes, comes with coverage

The concept of liquid wealth

  • Borrow against account (i.e.: real estate investment)
  • Enables family to pass on liquid legacy

Who this type of policy is for

  • Rich understand, know how to use
  • Mindset only barrier to entry

The interest associated with a Perpetual Wealth policy

  • Account holders own company, receive profit share
  • Typically 4 to 6%

The power of the Perpetual Wealth policy credit line

  • Can borrow entire amount (interest rate of 4 to 5%)
  • Don’t have to qualify, loan not on credit report

How Patrick uses his own policy

  • Hold cash reserves for personal and business life
  • Rest used as opportunity fund to invest
  • Use not dictated by anyone BUT you
  • Make better decisions with access to alternatives

How a Perpetual Wealth policy serves as a passive income generator

  • Longer you pay in, less risk to insurance company
  • Interest earned in later years is compounded
  • Consistency of income (not connected to volatility)

Connect with Patrick

Paradigm Life

Resources

Heads I Win, Tails You Lose: A Financial Strategy to Reignite the American Dream by Patrick H. Donohoe

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not by Robert T. Kiyosaki

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Deal Maker LIVE

Michael’s Website

Review the Podcast on iTunes

Direct download: ABI_128_v2.mp3
Category:Commercial Real Estate -- posted at: 10:56pm EDT

Real estate was a big winner in the tax reform bill passed in December 2017. So, how exactly do the new laws impact us as passive multifamily investors and syndicators? And how can we take advantage of the new regulations and use the available incentives to reduce the amount of money we owe the government?

Tom Wheelwright, CPA is the CEO of WealthAbility, a community of CPAs dedicated to reducing taxes and creating wealth for their clients. As a Rich Dad Advisor for Robert Kiyosaki, Tom is a well-known keynote speaker in the realm of wealth building and tax strategy. He is a regular contributor to publications including Forbes, The Huffington Post, Entrepreneur Magazine and Inman News, and Tom is the author of Tax-Free Wealth: How to Build Massive Wealth by Permanently Lowering Your Taxes.

Today, Tom joins me to explain how to shift the way you think about taxes, viewing the law as a roadmap to reducing how much you pay. He discusses the new laws around bonus depreciation, describing how both passive investors and syndicators benefit from the revised guidelines. Tom also shares the regulations around the 20% deduction and the changes in Section 179 that impact residential and commercial real estate investors. Listen in for insight around qualifying for the status of real estate professional and learn how to significantly reduce your taxes as a multifamily investor!

Key Takeaways

How Tom came to start his own network of CPA firms

  • Experience creating courses on reducing taxes
  • Worked for Fortune 500 company, as ASU professor
  • Founded own firm (goal to expand to 1K in 5 years)

How to shift the way you think about taxes

  • Incentive for doing what government wants
  • Professional investor can get to zero in few years

The new laws around bonus depreciation

  • Real estate now qualifies with new/used equipment
  • Cost segregation of contents, land improvements
  • Example—30% of $1M investment = $300K

How the new tax laws affect passive investors

  • Leverage 70% or more = no taxable cashflow
  • Convert ordinary income to capital gains by investing in syndication

How the new tax laws may impact syndicators

  • Hold carried interest for 3 years to get capital gains rates
  • Consider 1031 exchange to plan for potential 3-year issue

The changes around the 20% deduction

  • Applies to positive taxable income from real estate
  • Example—earn $100K, only taxed on $80K

The changes to Section 179

  • Deduction for new/used equipment applies to residential real estate
  • HVAC units, fire/security alarms and roofs in commercial properties

How to qualify for the status of real estate professional

  • Spend more than 750 hours during given year (15 hours/week)
  • Spend more time than other business, investment activities combined
  • Must meet qualifications every year and keep good documentation

The tax benefits of being a real estate professional

  • No passive losses from real estate (active can offset any income)
  • 8% Medicare tax doesn’t apply when sell property
  • 20% rule only applies to real estate that is trade or business

Connect with Tom

WealthAbility

The WealthAbility Show

Resources

Tax-Free Wealth: How to Build Massive Wealth by Permanently Lowering Your Taxes, Second Edition by Tom Wheelwright, CPA

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Michael’s Website

Direct download: ABI_127-v2.mp3
Category:Commercial Real Estate -- posted at: 3:18pm EDT

If the extent of your financial education involved learning how to be a good employee, trading your time for money, then you’re probably beginning to realize that you simply can’t save yourself into wealth. But how do the multimillionaires and billionaires among us grow their assets? What strategies do they implement to generate passive income—from multiple sources? Brian Fouts has identified the shared patterns among high-net-worth individuals, what he calls the 5 Pillars of Elevated Wealth, and he is on a mission to share this information with you and me.

Brian is the co-owner and CEO of The Elevation Group, an online membership platform that seeks to teach the world how to invest like the rich. Brian and his brother Jake are passionate about empowering people to create and grow wealth by way of financial literacy, and The Elevation Group affords access to a network of true expert advisors who can support you in implementing the investment strategies of the wealthiest among us.

Today, Brian sits down with me to share the 5 Pillars of Elevated Wealth. He explains how to generate supplemental income through a side hustle and put that money to work for you. Brian addresses the importance of safeguarding the money you have through entity protections and tax incentives. Finally, he describes how to acquire assets that generate passive income and why it’s smart to pursue multiple sources of revenue. Listen in for Brian’s advice around keeping your money in a life insurance vehicle and learn how The Elevation Group can help you build wealth by way of portfolio and passive income!

Key Takeaways

How Brian got involved with EVG

  • Started as member, blown away by vision
  • Platform brings together expert advisors
  • Financial education and empowerment

The 1st Pillar of Elevated Wealth: Do something different

  • Create impact in world
  • Generate income through side hustle
  • Shift mindset away from trading time for money

The 2nd Pillar of Elevated Wealth: Take the money off the table

  • Become own bank and put money to work
  • Can take advantage of opportunities when presented

The 3rd Pillar of Elevated Wealth: Protect what you have

  • Safeguard money through entity protections
  • Pay less taxes (i.e.: rent home to business)

The 4th Pillar of Elevated Wealth: Acquire assets to earn passive income

  • Build net worth and create cashflow
  • Real estate, oil and gas, private lender, etc.

The 5th Pillar of Elevated Wealth: Pursue multiple sources of income

  • Wealthy individuals have 7 on average
  • No crisis if 1 decreases or goes away

The benefits of The Elevation Group platform

  • 30-plus lessons in all 5 categories
  • Expert advisors to help implement
  • Monthly live events

The advantages of keeping your money in a life insurance vehicle

  • Guaranteed returns of 4-6%
  • Loan money to self for investments

Brian’s insight around the 3 sources of income

  • Active, portfolio and passive
  • Focus on portfolio and passive to build wealth

Connect with Brian

The Elevation Group

Email brian@theelevationgroup.com

Resources

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Michael’s Website

Podcast Show Notes

Review the Podcast on iTunes

Direct download: ABI_125.mp3
Category:Commercial Real Estate -- posted at: 4:45pm EDT

What is the quickest route to financial freedom through real estate? Do not pass Go. Do not collect $200. Go directly to… Multifamily. But how do you overcome a lack of experience and capital to accelerate the timeline and jump straight into apartment building investing?

Josh Eitingon is the founder and manager of JAE Property Group, a real estate investment company specializing in 50- to 150-unit value-add multifamily properties outside the New York metro area. With the guidance of a coach, Josh made his first multifamily investment in 2012, and now he is up to eight deals. He began his real estate career while working as a software developer, eventually joining a Long Island investment group where he led the acquisitions team in securing $100M in real estate. Today, Josh is a full-time investor in his own right.

Josh joins me to discuss the early investment in a coach that facilitated his shortcut to multifamily. He addresses how he overcame a lack of experience to do his first 20-unit deal and the personal guarantee he made investors to raise $200K for the renovation. Josh explains what he loves most about multifamily investing, describing the challenge of finding a formula to optimize each new property. Listen in for Josh’s advice around investing in your own deals, choosing the right location, and scaling up a multifamily business.

Key Takeaways

How Josh got started in real estate

  • Hired coach to force action
  • Multifamily made sense as asset class

Why Josh invested in a coach

  • Working 9-5 for software company
  • Long-term time, financial freedom

Why Josh went straight to multifamily

  • Dumb luck + mentor’s help
  • Ability to scale

How Josh overcame a lack of experience and money

  • Partnered on distressed 20-unit in Cincinnati
  • Raised $200K from family, friends and co-workers

How Josh overcame his reluctance to do the first deal

  • Poor condition, no background in renovation
  • Concerns around taking on debt
  • Believed in deal, commitment to go all-in

The factors for success on Josh’s first deal

  • Coach reinforced right path
  • Good location, visibility
  • Less than $10K/unit

How Josh raised $200K for the deal

  • Talking up real estate for 6 months prior
  • Personal guarantee at 9% interest
  • $10K chunks

The additional risk of raising money in debt

  • Bank loan for 80% + promissory notes
  • ‘I carry burden, not investors’

How Josh’s first multifamily deal played out

  • 20% occupancy, 0% economic occupancy
  • Spent $5K/unit on interior renovations
  • $50-70K on exterior, mechanical improvements

Josh’s subsequent multifamily investments

  • One or two deals per year ever since
  • 44- and 62-unit in same market
  • 70-unit in Florida

What’s next for Josh

  • 90-unit in Minneapolis under contract
  • Continue on same path, 2-3 deals/year

What Josh loves about the business

  • Creativity (partner, invest and find deals)
  • Find formula to optimize each property

The challenges of scaling a multifamily business

  • Source of equity
  • Right partner for any given deal

Josh’s advice for aspiring multifamily investors

  • Start saving money to invest in own deals
  • Commit to ongoing education
  • Right people around you (accountability)

Josh’s AHA moment around location

  • Good schools, retail in area
  • Allows for operational consistency

Josh’s top mistakes

  • Could have done more deals
  • Checks and balances on construction management

Connect with Josh

JAE Property Group

Resources

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not by Robert T. Kiyosaki

The Ultimate Guide to Buying Apartment Buildings with Private Money

The Michael Blank Coaching Program

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

  • Download
  • Text “secretbook” to 44222

Michael’s Website

Podcast Show Notes

Review the Podcast on iTunes

Direct download: ABI_124.mp3
Category:Commercial Real Estate -- posted at: 5:29pm EDT

‘The cost of my self-education was six figures in mistakes and seven [or] eight figures in lost opportunity.’

If you have a poverty mindset, investing money in a mentor or spending more for a qualified contractor seems like a burden. But if you have an abundance mentality, it becomes obvious that spending a little more up front for coaching and devoting your time to the activities that will grow your multifamily business result in higher revenue long-term.

Jack Petrick is the owner of Petrick Property Group, a real estate firm that specializes in multifamily acquisitions and improvements. He spent 15 years working as a firefighter in the Cleveland suburb of Strongsville, Ohio, before leaving to pursue real estate full-time.  Jack’s team focuses on on- and off-market multifamily assets, and to date, he has 100-plus rental units in Ohio and Florida.

Today, Jack joins me to discuss his initial experience as a self-taught custom home builder. He shares the major shift that took him from a poverty mindset to an abundance mentality and describes how he would use his time differently if he could go back to those early days. Jack explains the importance of mentoring and masterminds, the concept of forced appreciation, and the decision to hire an assistant that doubled his revenue. Listen in to understand what inspired Jack’s shift to multifamily investing and learn how to follow in his footsteps—by way of a laser focus on raising capital, finding deals and improving processes.

Key Takeaways

Jack’s introduction to real estate

  • Rich Dad Poor Dad changed thinking
  • Self-taught custom home builder
  • Single family rental properties

Jack’s major mindset shift

  • Poverty mindset (e.g.: hire cheap contractor)
  • Abundance mentality to save money long-term

How Jack would use his time differently

  • Invest in mentoring, masterminds
  • Raise capital, deal flow and operations

What stopped Jack from leaving his job sooner

  • Fear, thinking too small
  • Listen to ‘free advice’

How Jack got clear on what’s important

  • Time freedom to focus on family
  • Change lives for investors

Jack’s insight around mindset

  • Take action with right guidance
  • Get beyond comfort zone

Jack’s transition to multifamily

  • Walk-in medical clinic failed
  • Buy and holds continued to cashflow
  • Focus on pursuit of multifamily as option

The concept of forced appreciation

  • Buy value-add property at discount
  • Do renovation, tighten operations
  • Increase occupancy and rent
  • Value not contingent on market

Jack’s first multifamily deal

  • Came across on Facebook
  • 27-unit at 50% occupancy
  • Financed through hard money lender
  • Private investor to fund rehab
  • Repair sewer line, renovate units
  • Up to 100% occupancy

The value of hiring an assistant

  • Fastest way to double revenue
  • Focus on high-producing activities

What’s next for Jack

  • Expand multifamily portfolio (100K units)
  • Develop new multifamily properties

Connect with Jack

Petrick Property Group

Jack on Facebook

Resources

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not by Robert T. Kiyosaki

Go for No! Yes is the Destination, No is How You Get There by Richard Fenton and Andrea Waltz

Syndicated Deal Analyzer

The Ultimate Guide to Buying Apartment Buildings with Private Money

The Michael Blank Coaching Program

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

  • Download
  • Text “secretbook” to 44222

Michael’s Website

Michael on YouTube

Podcast Show Notes

Review the Podcast on iTunes

Direct download: ABI_123.mp3
Category:Commercial Real Estate -- posted at: 8:23pm EDT

The vast majority of us get into multifamily investing because we are hungry for time freedom. We want the flexibility to spend time with our families or travel or go to the gym in the middle of the day if we so choose. But many of us lose sight of that original goal in the pursuit of financial freedom. Our focus on earning money translates to doing ALL of the work ourselves, and before long, we are caught in an unsustainable cycle—doing tasks like bookkeeping and writing investor reports that undervalue our time and pull us away from the work only we can do: finding deals and raising money. So, how do we calculate the value of our time and make informed decisions about what to delegate? How do we hit the reset button and return our focus to the time wealth that inspired us to pursue apartment building investing in the first place?

Mark Dolfini is the founder of Landlord Coach, a mentoring program and business course for landlords and property managers. He is also the author of The Time-Wealthy Investor, Your Real Estate Roadmap to Owning More, Working Less, and Creating the Life You Want. Mark is on a mission to help multifamily investors realize the value of their time and design an intentional business that affords them both financial freedom and time wealth.

Today, Mark joins me to discuss his early interest in the idea of owning real estate and his gradual accumulation of 92 rental properties. He shares the mistakes he made in trying to do all the work himself that led to his Jerry Maguire moment in 2008 when he lost $4.5M overnight and ended up in the hospital with double pneumonia. Mark describes the mindset shift that helped him transition from self-employed to business owner and the VIP System he designed to create a sustainable real estate venture. Listen in for Mark’s insight on the concepts of life output and time wealth—and learn how to determine what your time is worth and delegate accordingly!

Key Takeaways

Marks’s early interest in real estate

  • Asked for real estate for Christmas as boy
  • Bought 40 acres in AZ while in Marines

How Mark accumulated 92 rental properties

  • Bought 12 while attending Purdue
  • 30 when quit working as accountant ($6M)
  • Made every mistake, no systems in place
  • Doing all work ‘life was definition of hell’

Mark’s Jerry Maguire moment in 2008

  • Drop from $65K in rent revenue to $30K
  • Lost $4.5M in real estate overnight
  • Worked more, developed double-pneumonia

How Mark transitioned from self-employed to business owner

  • Intentional about setting up sustainable business
  • Only do tasks that demo highest, best use of time

Mark’s VIP system

  • Vision beyond making money
  • Infrastructure = framework
  • Process = rules of operation

The concept of life output

  • Ability to control calendar
  • Financial wealth as means to end

How to determine the value of your time

  • Calculate current hourly wage (including travel)
  • View as loss of $ when performing lesser tasks

Connect with Mark

Landlord Coach

Landlord Coach on Facebook

Mark on LinkedIn

Resources

The Time-Wealthy Investor: Your Real Estate Roadmap to Owning More, Working Less, and Creating the Life You Want by Mark B. Dolfini

The Judge: A Landlord’s Tale by Mark Dolfini

Financial Freedom with Real Estate Investing: The Blueprint to Quitting Your Job with Real Estate—Even Without Experience or Cash by Michael Blank

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

  • Download
  • Text “secretbook” to 44222

Michael’s Website

Michael on YouTube

Podcast Show Notes


There are five key phases in the multifamily investing process, and the property manager you hire plays a key role in nearly every stage. So, what should you look for in a property management company? And what KPIs can you use to assess the property manager’s performance?

Bryan Chavis is a thought-leader in the realm of multifamily property management and the bestselling author of Buy It, Rent It, Profit and The Landlord Entrepreneur. He is also the founder of The Landlord Property Management Academy, an online platform for real estate professionals and property management certification. Bryan was named one of the top 40 up-and-coming entrepreneurs under 40 by the Gulf Coast Business Review, and he is a sought-after speaker and consultant for some of the largest housing authorities in the US.

Today, Bryan sits down with me to share his journey, discussing the obstacles he has overcome and his unique approach to ‘embracing adversity.’ He walks us through the five phases of multifamily investment, discussing the current challenges around the acquisitions process and the fundamentals of the implementation stage. Bryan explains what to look for in a property management company and the Key Performance Indicators he reviews on a monthly basis. Listen in for Bryan’s insight on finding a property manager who is proactive and learn to relish the journey as a multifamily investor!

Key Takeaways

Bryan’s introduction to real estate

  • Job as leasing agent for free apartment
  • Learned from private, institutional investors

Bryan’s key takeaways as a property manager

  • Understanding of asset management, acquisitions
  • Real-life experience as operator

What inspired Bryan to branch out on his own

  • ‘Why not me?’
  • Experience in all facets of multifamily
  • Speaking career to develop business

The adversity Bryan had to overcome

  • High school diploma, lack of capital
  • Devastating brain tumor (no insurance)

Bryan’s approach to ‘embracing adversity’

  • Character-building opportunity
  • Share story to inspire others

Bryan’s 5 phases of a multifamily investment

  1. Acquisitions
  2. Implementation
  3. Stabilization
  4. Growth
  5. Exit strategy

The current challenges around acquisitions

  • Standoff between buyers and sellers
  • Wade through deals to find one that works

Bryan’s view of the implementation phase

  • Establish procedures, consistency
  • Software (e.g.: Buildium)

How to avoid mistakes during the acquisitions process

  • Build margin of error into underwriting
  • Focus on low cash multiple but high efficiency

What to look for in a property management company

  • User-friendly, intuitive software platform
  • Ability to manage every asset class
  • Management plan specific to property

The difference between a proactive and reactive property manager

  • Control income, expenses during stabilization
  • Software, training allows to manage as business

Bryan’s approach to overseeing a property manager

  • ‘Inspect what you expect’
  • Walk property on regular basis
  • Scrutinize KPIs monthly

Bryan’s Key Performance Indicators (KPIs)

  • Rent rolls, maintenance tickets/budget
  • P&Ls, delinquencies and turnover
  • Traffic and closings

Bryan’s current mission

  • Wake up and be appreciative
  • Relish journey, relationships

Connect with Bryan

Buy It Rent It Profit

Landlord Academy

Multifamily Facebook Group

Bryan on Facebook

Bryan on Twitter

Call 1-800-535-2476

Resources

Buy It, Rent It, Profit: Make Money as a Landlord in ANY Real Estate Market by Bryan M. Chavis

The Landlord Entrepreneur: Double Your Profits with Real Estate Property Management by Bryan M. Chavis

Buildium

Michael’s Products

The Ultimate Guide to Apartment Building Investing

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Deal Desk

Deal Maker LIVE

Michael’s Coaching Program

Partner with Michael

Invest with Michael

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

Review the Podcast on iTunes


You don’t necessarily need an enormous multifamily portfolio to achieve financial freedom. It is possible to start small and replace your income with modest holdings of just 20 units!

Aaron Howell is a small multifamily investor with Black Lick Holdings, a real estate firm based in Crozet, Virginia. With a portfolio of 22 rental units, Aaron has replaced his income as a pharmacist and now works part-time because he WANTS to, not because he HAS to.

Today, Aaron joins me to share his accidental introduction to real estate and when he was finally inspired to develop a strategic plan. He describes the light bulb moment when he realized the income potential of a duplex versus a single-family property and how he fostered the confidence to pursue multifamily despite a lack of experience. Aaron walks us through his first several deals, explaining how he financed the most recent 6-unit through a partnership. Listen in for Aaron’s insight around building in daily habits to stay motivated and learn how he achieved financial freedom with a small portfolio!

Key Takeaways

Aaron’s introduction to real estate

  • Bought townhouse in 2006
  • Rented to cover mortgage after move

Aaron’s start in single family

  • Opportunities in Las Vegas
  • Desire to create passive income

What inspired Aaron to develop a strategic plan

  • Got married in 2015 and closed on first duplex
  • Realized upstairs rent covered mortgage
  • Heard Michael on podcast and took course

Why Aaron was confident in small multifamily investments

  • Same process with bank as single family
  • Did well in Vegas despite lack of experience
  • Solid team in place to support

How Aaron financed his first multifamily deals

  • Home equity line of credit
  • Relationship with local bank
  • Sold Vegas properties (1031)

Aaron’s take on partnerships vs. syndication

  • Pittsburgh property partnership among 4 investors
  • Syndication in future to control deal

Aaron’s transition to working part-time

  • Wants to work but doesn’t have to
  • Weekends, evenings free

Aaron’s real estate plans for the future

  • Scale up to larger properties
  • Raise money through conversations

Aaron’s insight around financial freedom

  • Shawshank Redemption moment
  • Sense of confusion

Aaron’s advice for aspiring multifamily investors

  • Do SOMETHING
  • Build network
  • Get familiar with market

How Aaron stays motivated

  • Habit List app (e.g.: read 20 minutes, look at 15 listings)
  • ‘20 units’ on chalkboard in kitchen

Connect with Aaron

Aaron on BiggerPockets

Email ahowell7@hotmail.com

Resources

Michael on the Joe Fairless Podcast

BiggerPockets

Redfin

Zillow

Habit List

Michael’s Products

The Ultimate Guide to Apartment Building Investing

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Deal Desk

Deal Maker LIVE

Michael’s Coaching Program

Partner with Michael

Invest with Michael

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

Review the Podcast on iTunes


Whether you are looking to become a multifamily syndicator or money raiser, it is difficult to get your foot in the door if you’ve never been involved in a deal. So, how do you build a resume without any experience or capital to speak of? The answer lies in partnerships with someone who’s done it before!

Danny Woodford is a Managing Partner at Mission Bay Investments, a multifamily investment firm with properties in the Mid-Atlantic, Southeast and Texas markets. Mission Bay is focused on value-add opportunities of 100-plus units, and the firm has closed on five deals of nearly 1K units to date. Prior to real estate, Danny served in the military, working to develop the space capabilities of the United States. He holds a master’s in real estate development from George Mason University.

Today, Danny joins me to explain what inspired him to retire from the military and pursue real estate. He walks us through his initial single family business model and the AHA moment that motivated his transition to multifamily. Danny offers the details of his first two multifamily deals in Richmond, Virginia, sharing the reasons why he continues to source deals despite the challenging market. Listen in for Danny’s insight around bringing a deal to a potential partner and learn how to build your multifamily resume by teaming up with someone who’s been there!

Key Takeaways

What inspired Danny’s shift from the military to real estate

  • No control over time
  • Long commute, missed family events

How Danny found the time to get educated in real estate

  • Designed plan with wife to replace income
  • Research during commute, nights and weekends

Danny’s initial business model

  • Build portfolio of single family rentals
  • Fix and flips to finance renovations

Why Danny made the transition to multifamily

  • Conversation with colleague at single family seminar
  • Multifamily offers more in terms of efficiency, scale
  • Financing more attractive (nonrecourse lending)

Danny’s first multifamily deal

  • 40-unit apartment building in Richmond
  • Found through broker relationship
  • Purchased for $1.1M (one investor)
  • Completed exterior, electrical work
  • Sold for $1.5M in 1031 exchange

Danny’s second multifamily deal

  • 98-unit purchased for $5.8M
  • Syndication raise of $10M
  • Rents $100 below market

Why Danny is finding deals despite a challenging market

  • Resume of five multifamily deals (two under contract)
  • Relationships with brokers, investors and lenders

The value of partnering as a money raiser

  • Brought into management team
  • Compensation for efforts, builds resume

Danny’s advice for aspiring multifamily investors

  • Bring capital or deal to table
  • Partner with experienced investor
  • Go straight to multifamily

How to bring a deal to a potential partner

  • Do homework on project (analysis, underwriting)
  • Establish relationship with seller/broker

What Danny is looking for in money-raising partners

  • Education and drive
  • Experience raising money

Connect with Danny

Mission Bay Investments

Call (661) 816-0335

Email daniel@missionbayinvestments.com

Resources

LoopNet

Michael’s Products

The Ultimate Guide to Apartment Building Investing

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Deal Desk

Deal Maker LIVE

Michael’s Coaching Program

Partner with Michael

Invest with Michael

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

Review the Podcast on iTunes


The attitude toward cannabis has shifted: 64% of Americans support the legalization of marijuana, 93% support medical consumption, and the drug is legal in nine states plus Washington, DC. By 2028, the cannabis space is projected to be a $60B industry. So, what does that mean for us as real estate investors? How can we take advantage of the need for property to grow, manufacture and sell cannabis products?

Leslie Plettner is the director of BaseCanna, a team of cannabis, legal, finance and real estate experts who provide the funding, infrastructure and property for cannabis entrepreneurs. Leslie is a long-time entrepreneur with extensive experience in real estate. She has developed and managed more than 500 units, including a mix of warehouse, multifamily and retail properties. Three years ago, Leslie anticipated the emergence of the cannabis industry and recognized its need for cannabis-friendly landlords, and the idea for BaseCanna was born.

Today, Leslie joins me to describe BaseCanna’s work in developing an ecosystem of cannabis operators and the market opportunity in the space for real estate developers. She shares the risks of cannabis real estate, both perceived and real, and explains how BaseCanna makes decisions around who to work with. Listen in for Leslie’s insight on the appreciation of a property once it’s licensed for cannabis and learn why now is the right time to get into cannabis real estate!

Key Takeaways

The mission of BaseCanna

  • Anchor development of cannabis ecosystem with real estate
  • Support operator-members with compliance, legal issues, accounting & insurance

Leslie’s background as an entrepreneur

  • Designed, transformed underperforming schools
  • Shift to real estate when started family

BaseCanna’s current work

  • Creating vertically integrated ecosystem (seed to sale)
  • Vet municipalities, real estate and operators

The market opportunity in cannabis real estate

  • Fastest growing since broadband internet
  • Huge expansion in therapeutic consumption
  • Shift in attitude (93% support medical use)

The myths around owning cannabis real estate

  • Pothead tenants, criminal activity
  • Civil asset forfeiture (landlords protected)

The real risks around owning cannabis real estate

  • Must be in municipality regulated for cannabis
  • Ensure tenant has license, pays taxes
  • Property must be zoned for cannabis
  • Be careful of green rush illusion
  • OSHA fines, federal prohibition

How BaseCanna makes decisions around who to work with

  • Right license for right product in right market
  • Pay attention to overall market trends (i.e.: demand for manufactured products)

The appreciation on a property once it’s licensed for cannabis

  • BaseCanna paid $1.8M for two warehouses
  • Offers for $4.5M once repositioned

The permitting process for cannabis real estate

  • Very involved, 200-page applications (SOP, demo capacity)
  • Lawyers charge $40K to $75K to guide through process

Leslie’s advice on having an exit strategy

  • First opportunity = create operational campus
  • Immediate exit available once licensing in place

Leslie’s insight on getting in the cannabis game now

  • Institutional money will come in with end of federal prohibition
  • Real estate premiums will fall as more municipalities regulate

Connect with Leslie

BaseCanna

Resources

UCLA Study on Crime & Dispensaries

MAUCRSA

The Rohrabacher-Blumenauer Amendment

Michael’s Products

The Ultimate Guide to Apartment Building Investing

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Deal Desk

Deal Maker LIVE

Michael’s Coaching Program

Partner with Michael

Invest with Michael

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

Review the Podcast on iTunes


Anna Simpson’s philosophy is that you don’t make money in your comfort zone. Once she has achieved a goal, Anna finds a way to push her limits and look forward to the next. And when things start to get difficult, that’s when Ana knows she needs to keep digging: She’s getting closer to the gold.

Anna is a full-time accredited multifamily investor and deal sponsor with experience in property valuation, acquisition, rehabilitation, leasing and asset management. She got her start investing in single family buy and holds before making the decision to transition to multifamily as a passive investor. Anna personally invested in 1,300 multifamily units as an equity partner and key principal before she was ready for the next challenge of becoming a managing partner. Today, Anna has completed two multifamily deals: a 70-unit syndication and a 76-unit 1031 exchange.

Today, Anna sits down with me to share her decision to work ON the business rather than IN it by making the shift to multifamily. She explains how she leveraged her role as a passive investor to learn the fundamentals of syndication and the key challenge she faced in landing her first deal as managing partner. Anna offers insight around the value of persistence and breaking big goals down into smaller chunks. Listen in for Anna’s advice on pushing beyond your perceived limits and learn why she believes that while knowledge is important, true power lies in consistent ACTION.

Key Takeaways

How Anna got involved with real estate

  • Friends active in single family group
  • ‘Success breeds success’

Anna’s initial investment strategy

  • Single family buy and hold rentals
  • Successful but difficult to scale

Anna’s shift to multifamily

  • Working on New Year’s Eve
  • Made decision to work ON vs. IN
  • Got involved as passive investor

What Ana learned as a passive investor

  • How to communicate with vendors, investors
  • How to supervise rehab
  • How to design, implement plan

Anna’s first multifamily deal

  • Found off-market through relationships
  • Syndicated 70-unit deal (23 passive investors)
  • $4M purchase price, $1.4M raise in one day

Anna’s approach to goal-setting

  • Identify where you are and where you want to be
  • Break down into smaller goals (e.g.: one LOI/week)
  • Work backwards and assess regularly

Anna’s key challenge in landing her first multifamily deal

  • Overcame lack of track record with team
  • Experience as investor in 1,300 doors

How the Law of the First Deal impacted Anna

  • Second deal under contract 2 months after first
  • Off-market deal through broker

Anna’s insight on the value of persistence

  • Difficult times mean you’re getting closer
  • Accept setbacks as part of journey
  • Move forward to build reputation, respect

What Anna would do differently given the opportunity

  • Start earlier with apartments
  • ‘You don’t know what you don’t know’

Anna’s advice for aspiring real estate investors

  • Learn through podcasts, groups, etc.
  • Treat as business not hobby
  • Consistent ACTION = POWER
  • Work on mindset constantly
  • Leverage passion on down days

How Anna navigates the down days

  • Surround with supportive, optimistic people

Connect with Anna

Anna’s Website

Resources

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not by Robert T. Kiyosaki

Michael’s Deal Maker Mastermind

Deal Desk

Deal Maker LIVE

Michael’s Coaching Program

Michael’s Products

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes

Podcast Show Notes

Review the Podcast on iTunes


Alan Schnur was away on a business trip when a plane struck his office building, killing 40 of his 44 team members. In the aftermath of 9/11, Alan spent a lot of time questioning what he wanted out of life and the experience informed his drive for continuous growth. Because you never know when another plane is coming, Alan doesn’t believe in complacency. In fact, he makes it a point to reinvent himself every few years and take on new challenges in residential and commercial real estate.

Alan is a wildly successful real estate investor based in Houston, Texas. He began his real estate career rehabbing single family homes, owning a portfolio of 120 before making the transition to apartment buildings. Alan’s go-big-or-go-home mindset translated to multifamily, and he invested in 2K units across 18 complexes—AND founded a property management company that handled 7K units across 40 properties. Now he is taking on a new challenge in commercial real estate, investing in shopping centers along with medical, office and warehouse buildings. Alan is the author of three books on real estate investing, including The Cashflow Mindset: Millionaire, Billionaire & Zillionaire Designs for Financial Freedom & a Fulfilled Life.

Today, Alan joins me to share the story of his reawakening in the aftermath of 9/11 and explain how his skill set as a commodities broker translated to real estate investing. He speaks to the single family formula that dominated the first ten years of his career and his subsequent shift to apartment buildings during a trip to Japan that may or may not have involved saké. Alan describes his apartment addiction, discussing his best and worst multifamily deals as well as his reasons for pursuing syndication. Listen in for Alan’s insight on being flexible with geography and asset classes, taking on new challenges in commercial real estate, and stepping out of your comfort zone to take ACTION!

Key Takeaways

Alan’s AHA moment

  • Job as commodities broker on 101st floor of World Trade Center
  • On business trip during 9/11, lost 40 of 44 team members
  • Week in hotel room led to reflection, reawakening
  • Move to Houston with company, rented condo in NYC

Alan’s experience with single family homes

  • First purchase for $23K, profit of $100/month
  • Bought one/month for 10 years (120 houses)
  • Formula: Rehab, Rent, Refi, Repeat

Why Alan made the transition to multifamily

  • Accumulated enough assets to quit job
  • Bought 25 houses during trip to Japan
  • Realized potential of apartment buildings

Alan’s first multifamily acquisition

  • $40K down on 76-door building (owner financing)
  • Generated more income than 100 houses

Alan’s ‘addiction’ to apartments

  • Buy one every 90 days
  • 18 complexes with 2K units

When Alan got involved with syndication

  • Running out of money, wanted to share risk
  • Started raising money on second or third complex
  • Began with general partner at 30%, 70% for sale
  • Work up to 40-50% for general partner

Alan’s best multifamily deal: The Bangkok Close

  • 1031 buyer wanted 300-unit deal
  • Invested $7M, sold for $14M

Alan’s worst multifamily deal

  • Paid $5K/unit for 160-door complex
  • School across street closed and knocked down
  • Money from bank robbery hidden in sewer line
  • Inspired shift to higher quality assets

Alan’s shift to commercial properties

  • Apartments have variable costs (unpredictable)
  • Triple net lease makes commercial predictable
  • Business renting covers repairs, insurance/taxes

Alan’s shopping center deal in Boise, ID

  • Bought six storefronts for $1M
  • 50% discount (three vacancies)
  • Closed at $2.4M

Alan’s outlook on asset classes

  • Be flexible with geography, asset classes
  • Try more things = better chance of success

Alan’s advice for aspiring real estate investors

  • Put book down and get out to property
  • Join networking group or pay for mentor
  • Watch and learn by joining syndication

What Alan is excited about moving forward

  • Retail syndication
  • Education, helping others

Connect with Alan

Alan’s Website

Resources

The Cashflow Mindset: Millionaire, Billionaire, Zillionaire Designs for Financial Freedom & a Fulfilled Life by Alan Schnur

Books by Alan Schnur

LoopNet

International Council of Shopping Centers

National Apartment Association

National Real Estate Investors Association

Michael’s Coaching Program

Michael’s Products

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes


If you are new to the idea of raising money to invest in apartment buildings, the particulars of complying with SEC regulations may have you spooked. No one wants to inadvertently break the law and face restitution, sanctions, or worse—fines and jail time! The good news is, with an assist from an SEC attorney, it is not as difficult to comply with securities laws as you might think.

Mauricio Rauld is the founder and CEO of Premier Law Group, a boutique securities firm specializing in asset protection and SEC compliance. Mauricio has 18-plus years of experience helping multifamily investors increase and safeguard their wealth through syndications. He is a regular contributor to The Real Estate Guys Radio show and a faculty member of the Summit at Sea, a week-long conference for elite real estate entrepreneurs. In addition, Mauricio serves as legal advisor to The Real Estate Guys and asset protection advisor for The Elevation Group.

Today, Mauricio sits down with me to explain his role as a syndication lawyer. He discusses the two legal routes to SEC compliance, the idea of a ‘preexisting substantive relationship,’ and the consequences of breaking the law. Mauricio shares the difference between 506(b) and 506(c), describing the right way to use social media to connect with investors under each exemption. Listen in as Mauricio walks us through the process of working with an SEC attorney, including the general timeline and approximate cost for ensuring compliance with securities law.

Key Takeaways

Mauricio’s role as a syndication lawyer

  • Helps real estate investors scale business
  • Raise money legally for bigger deals

What qualifies as a security

  • Returns generated from your efforts
  • Must comply with federal, state laws

The two legal routes to compliance

  1. Register with SEC (two-year process)
  2. Find exemption, follow rules

The consequences of not following the law

  • Restitution—return money to investors
  • Sanctions—prohibited from raising money
  • Fines, jail time

Mauricio’s advice around disclosures

  • Full disclosure required for non-accredited investors
  • Not required for accredited investors ($1M net worth)

The benefit of using an exemption

  • Creates safe harbor, certainty
  • Preempts state law

The features of the 506(b) exemption

  • Raise unlimited amount of money
  • Up to 35 non-accredited investors
  • Prohibited from advertising

The features of the 506(c) exemption

  • Lifts prohibition against advertising
  • Accredited investors only, reasonable steps to verify

The idea of a preexisting substantive relationship

  • Citizen VC outlines nine points
  • Deep conversation, questionnaire, credit report, etc.

How to use social media to connect with investors under 506(b)

  • Talk about business in general terms
  • Don’t discuss specific offer or prior deals

The process of working with an SEC attorney

  • Work together on business plan, structure
  • Lawyer drafts offering documentation
  • Includes PPM, operating/subscription agreements
  • 506(b) = investor questionnaire
  • 506(c) = CPA letter or third-party verification
  • Accept money only after documents returned

Mauricio’s insight around the timeline and general cost of compliance

  • One week to draft docs once business plan complete
  • Include $15K ‘legal and compliance’ line item in budget

Connect with Mauricio

Premier Law Group

Email cs@premierlawgroup.net

Resources

Citizen VC Letter

Verify Investor

Michael’s Coaching Program

Michael’s Products

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes


Every human interaction is a negotiation. Whether you are communicating with employees, investors, friends or family, the language of give-and-take is at play. And the fact of the matter is, if you don’t ask, you don’t get. So, how can we leverage the ten commandments of negotiation to get more of what we want in the realm of multifamily real estate—and life in general?

Stefan Aarnio is an award-winning real estate investor, entrepreneur and author. He was named one of the Top 10 Real Estate Influencers to Follow by Entrepreneur magazine in 2017 and inducted into the Rich Dad International Hall of Fame in 2014. Stefan is the author of four books on real estate investment and negotiation, including X: The Ten Commandments of Negotiation.

Today, Stefan joins me to share the story of how he went from poor musician to millionaire real estate investor by becoming a student of negotiation. He walks us through his ten commandments of negotiation, explaining the importance of gathering information before you make an offer as well as having clearly written goals going into a negotiation. Stefan speaks to the idea of presenting an ‘offer of greater value’ and making people work for concessions. Listen in for Stefan’s insight around emotional decision-making and the key commandment of negotiation: Get what you want and get out!

Key Takeaways

Stefan’s journey from poor musician to millionaire real estate investor

  • Teaching guitar and playing gigs, not good life
  • Predictable way to get rich in Rich Dad Poor Dad
  • Author, Rich Dad International Hall of Fame

The importance of negotiation in real estate and life in general

  • Part of every human interaction
  • If you don’t ask, you don’t get

The cultural differences around negotiation

  • Every culture has own style, boundaries
  • Deconditioned in name of commerce in west

Commandment #1: Get what you want and get out

  • Pushing for more can kill negotiation

Commandment #2: Adopt a pleasing personality

  • Student with no egos, rivalries came out on top

Commandment #3: Prepare diligently and collect information

  • Know facts in advance to make offer on-the-spot

Commandment #4: Know what you want and have clearly written goals

  • Outline one major, three minor points (i.e.: price, terms)

Commandment #5: Gather information before making an offer

  • Newbies tend to make offers too quickly

Commandment #6: Always present an offer of greater value

  • People will pay premium for service that solves problem

Commandment #7: Do not give concessions freely

  • Make people work for concessions, get something in return

Commandment #8: Take what they WANT, but give what they NEED

  • Manage wants, recognize double standard in transactional negotiation

Commandment #9: Obey non-linear time in the negotiation process

  • Time can move forward, backward or break (manipulate for advantage)

Commandment #10: Become a student of human nature and irrationality

  • Reptilian brain makes emotional decisions based on fear and greed

How the dynamics of negotiation change when a broker is involved

  • Don’t usually make things easier
  • Deal with seller directly if possible

Connect with Stefan

Stefan’s Website

X: The Ten Commandments of Negotiation

Resources

Self Made: Confessions of a Twenty Something Self Made Millionaire by Stefan Aarnio

X: The Ten Commandments of Negotiation by Stefan Aarnio

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

Blackbook Journal by Stefan Aarnio

Michael’s Coaching Program

Michael’s Products

Michael’s Syndicated Deal Analyzer

Michael’s Deal Maker Mastermind

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes


Courage isn’t about being fearless. Courage is about feeling the fear but ‘saddling up anyway.’ When Peter Conti bought his first duplex, he admits that he was shaking. But Peter knew that he had to make a change to life the life he wanted, to be free from the humiliation of a boss who reprimanded him for drinking coffee meant for ‘customers only.’ Peter was highly motivated to leave his job as a mechanic and become a multifamily real estate investor, and that deep desire for financial freedom propelled him to take action.

Peter went from auto mechanic to self-made millionaire in just over three years, using creative financing to invest in both residential and commercial real estate. He started small, buying a duplex, a couple of 4-units, and a 12- and 24-unit before working his way up to shopping centers and 300-unit complexes. He has mentored thousands of investors all over the world and supported many more through his books on multifamily and commercial real estate investing.

Today, Peter sits down with me to describe the moment he decided to take charge of his own financial destiny. He walks us through that first investment in a duplex and the meeting at Chucky E. Cheese that inspired him to invest in a mentor. Peter offers advice around mitigating risk via exit clauses and acquiring property through seller financing or the use of a master lease. Listen in to understand Peter’s unique approach to recovering from a serious motorcycle accident and what he learned in the process that applies to multifamily investing specifically—and life in general!

Key Takeaways

The turning point that propelled Peter into action

  • Working as auto mechanic in Denver
  • Fingers numb from cold, reprimanded for coffee
  • Made decision to be in charge of own financial destiny

Peter’s first investment in a duplex

  • Found real estate agent
  • Took advantage of 5% down for investors through HUD

How Peter got over the hump to make his next investment

  • Meeting with life insurance agent, realized ‘spinning wheels’
  • Invested $5K in training with mentor

Peter’s advice around mitigating risk

  • Attach ‘Addendum A’ to contract (fully assignable)
  • Ask for 10 business days once documents provided
  • Allows to make offer first, then do due diligence

Peter’s guidance around seller financing

  • Target motivated sellers, C class properties
  • Ask seller if willing to carry some of financing
  • Set meeting to build rapport, share track record

Peter’s approach to getting started in commercial real estate

  • Start with apartment buildings (4-, 6- or 10-unit)
  • Consider using master lease to acquire property

What Peter learned in recovering from his motorcycle accident

  • Hiking Appalachian Trail gave time to reflect
  • Enjoy every moment to fullest, appreciate process
  • Break big projects into chunks

What’s next for Peter

  • Learning to play piano
  • Support wife in startup
  • Limited one-on-one coaching

Peter’s top advice for aspiring real estate investors

  • It’s not about wealth, it’s about freedom
  • Find way to enjoy journey

How Peter wants to be remembered

  • Fully present for friends and family
  • Playful, fun and encouraging

Connect with Peter

Peter’s Website

Free Copy of Peter’s Book

Resources

Making Big Money Investing in Foreclosures Without Cash or Credit by Peter Conti

Making Big Money Investing in Real Estate: Without Tenants, Banks, or Rehab Projects by Peter Conti and David Finkel

Commercial Real Estate Investing for Dummies by Peter Conti and Peter Harris

Wild: From Lost to Found on the Pacific Crest Trail by Cheryl Strayed

1 Simple Strategy to Escape the 9 to 5 by Peter Conti

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“It’s these little things that we do every day that get us closer. I remember climbing a mountain in high school, and the guide told us, ‘Don’t look at the summit. Focus on putting one foot in front of the other, and the summit will take care of itself.’ That’s exactly how I treat business. As long as I know I’m on the right mountain—which I firmly believe is multifamily—I come in here every day and focus on putting one foot in front of the other.”

Ivan Barratt is the founder and CEO of Barratt Asset Management, a real estate investment and management company out of Indianapolis that specializes in the acquisition, redevelopment and management of multifamily apartment communities. Since forming the firm in 2010, Ivan has raised tens of millions in equity, acquired 2,700 units, and grown BAM to a best-in-class management company, boasting $100M in assets under management.

Ivan joins me to explain how he started small with a duplex and 6-unit property, financing deals with hard money loans. He discusses his gradual transition to larger deals, describing his approach to raising capital by building trust with potential investors in the business and medical communities. Ivan shares his ‘mortal sins of multifamily’ as well as the game changers that have allowed him to scale up to 2,700 units. Listen in for Ivan’s advice around doing little things every day to prepare for your career as a multifamily investor!

Key Takeaways

How Ivan got his start with a duplex

  • Put down as little as possible
  • Lived in one side, rented other
  • ‘Journey of $10K units starts with first deal’

What Ivan would do differently given the opportunity

  • Go straight to 20-, 30- or 40-unit deals
  • Takes same effort to close small deal as large one
  • Track record and momentum are most important

How Ivan got started with hard money loans

  • Small multifamily opportunities in market
  • Great lender put up cash for acquisition, renovation

Ivan’s early 6-unit deal

  • Evaluated using simple flipper equation
  • Bought for $150K, $100K in renovations
  • Refi nine months in to put high-interest debt to rest
  • Sold for $350K

How Ivan transitioned from hard money to raising capital

  • Built large pipeline of contacts, ask for referrals
  • Conversations with people in business and medicine

Ivan’s approach to building relationships with investors

  • Get to know people through common interests
  • Explain what you do and treat people well
  • Deliver value, educate on what good deal looks like
  • Network multiplies on its own over time

Ivan’s ‘mortal sins’ of multifamily

  • Tried to renovate project out of cashflow
  • Viewed property management co as profit center

Ivan’s AHA moment after the crash

  • Rereading Rich Dad… reinforced cashflow as king
  • Realized need to build model and scale
  • Reduced risk for WHEN market changes, not IF

The game changers that have allowed Ivan to scale

  • View property management arm as a necessary machine (not a profit center)
  • Bring in a partner for sweat equity, combined forces greater than the sum of parts

Ivan’s advice for aspiring multifamily investors

  • Get educated through podcasts
  • Underwrite 100 deals on LoopNet
  • Set networking goals (investors, brokers and team)
  • Do little things every day to prepare

Why Ivan continues to grow and scale his business

  • Driven by possibilities, freedom

Ivan’s perfect day on Gulf Shores

  • Up before sun to workout
  • Mission-critical emails/calls, check in with partner
  • Day on beach or at pool with family

Connect with Ivan

Barratt Asset Management

Call (317) 762-2625

Resources

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

LoopNet

Ivan on BiggerPockets

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Before Tim Hubbard purchased and renovated his small multifamily property in Memphis, Tennessee, the long-term rents ranged from $350/month for the studios to $700/month for the two-bedroom unit. After the renovations, complete with furnishings and Airbnb-ready locks and amenities, Tim began earning revenue of $2,500/month—PER UNIT! How did he do it? What made this particular property perfect for the short-term rental market? Is the Airbnb model right for you?

Tim Hubbard began his career in the hospitality industry before making the transition to real estate. He is passionate about travel, and the Airbnb model allows Tim to visit dozens of countries around the world—while providing the opportunity for others to do the same. Tim serves as the Director of Operations for Midtown Stays, a vacation rental company with properties in both Memphis and Sacramento, California.

Tim sits down with me to explain how he got involved in the worlds of real estate and Airbnb. He describes his experience purchasing and renovating an 8-unit in Memphis for short-term rental, discussing how much he invested in the property, what it took to make the apartments Airbnb-ready, and how he financed the deal through a local bank. Listen in for Tim’s insight around managing Airbnb properties remotely and learn what factors to consider in choosing vacation rental property!

Key Takeaways

Tim’s experience with Airbnb

  • User since 2012, began hosting in 2015

Tim’s background in real estate

  • Wanted to pursue travel, started investing in 2010

Tim’s 8-unit property in Memphis

  • Staying in Airbnb on same street
  • Found large colonial in Midtown
  • Vacated entire building to renovate

How Tim financed the venture

  • Commercial loan from local bank

Tim’s backup plan should new regulations restrict Airbnb

  • Go back to long-term rental

The extent of the renovations on Tim’s property

  • Built in 1912, needed top-to-bottom overhaul
  • Updated plumbing/electrical, structural work
  • Seller replaced roof as part of deal

How much Tim invested in the property

  • Bought for $270K
  • $200K in renovations, furniture

The revenue from rent before and after

  • Long-term rents ranged from $350 to $700/month
  • Airbnb income per unit after was $2,500/month

How Tim made the units Airbnb-ready

  • Installed digital locks
  • Provide guest essentials (i.e.: iron, kitchen appliances)

How Tim manages the units

  • Software, reservation system in place
  • Housekeeping and maintenance staff
  • Full-time manager local to Memphis

How Tim can market the units on multiple sites

  • Use ChannelManager to syndicate
  • Sync calendars to prevent double-bookings

What’s next for Tim

  • Explore other markets, purchase more in Memphis
  • Pursue master lease model to scale faster

Tim’s insight around considerations for short-term rentals

  • Airbnb guests looking for unique experience
  • Walking distance from local attractions
  • Landlord-friendly, turnkey markets (e.g.: Memphis, Indianapolis)

Connect with Tim

Midtown Stays

Email tim@midtownstays.com

Resources

Tim’s Before & After Photos

Nav Athwal on Apartment Building Investing

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

Guesty

Airbnb

VRBO

HomeAway

ChannelManager

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

  • Download
  • Text “secretbook” to 44222

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Direct download: MB_111-_AirBnB_for_Apartments-Tim_Hubbard.mp3
Category:Commercial Real Estate -- posted at: 8:07pm EDT

No one wants to lose their shirt—or anything else for that matter—in multifamily investing. But it’s easy for inexperienced syndicators develop an emotional bias and conflate the numbers in order to make a deal look good to potential investors. And passive investors new to the game typically focus on returns, when their first question ought to be about the risks involved. Conservative underwriting is the key to risk management for syndicators and investors alike… But how do you ensure that the numbers are reasonable? What questions should investors be asking? And how can you tell when a syndicator is too aggressive?

Omar Khan is a Chartered Financial Analyst with Boardwalk Wealth, a private equity firm based in Dallas, Texas, that connects international investors with multifamily opportunities in the southern US. Omar is responsible for raising capital, strategic planning, the development of underwriting models, and investor relations. He has 10-plus years of global investment experience, and Omar has participated in capital financing and M&A transactions valued at $3.7B.

Omar joins me to explain how to identify aggressive underwriting and ensure the accuracy of the numbers used in a particular model. We cover conservative guidelines for reserves and loan terms as well as the importance of planning for worst-case scenarios. Listen in for Omar’s insight around what to look for in a syndicator, how to leverage a sensitivity analysis, and the exit strategy questions an investor should ask—and a syndicator should be prepared to answer!

Key Takeaways

Omar’s background in finance

  • Ten years investing experience
  • Raise capital, develop underwriting models (large syndication deals)

How to identify aggressive underwriting numbers

  • Unreasonable rent growth projections (4% max)
  • Overly ambitious rehab plans

How to ensure accuracy of numbers used in model

  • Ranges rather than specific numbers
  • Sponsor solicits several data sources

What Omar looks for in the cap rate at exit

  • 50-200 basis points higher (3-5 year term)

The internal systems questions passive investors should be asking

  • Frequency of communication with sponsor
  • Auditing of financial statements (who, how often)
  • Systems, resources to resolve problems

The qualities Omar is looking for in a syndicator

  • Admit to mistakes rather than blaming others
  • Plan for solving potential problems

Omar’s insight around communicating with investors

  • Monthly email to relate progress
  • Quarterly, annual in-depth reports
  • Open and honest when mistakes made

Omar’s advice around conservative loan terms

  • Avoid 12-24 month refi
  • As long term as possible (even if slightly higher interest rate)
  • First question should address risk rather than returns

Omar’s approach to bridge loans

  • Don’t touch unless very experienced
  • Get out as quickly as possible (12 months)
  • Shouldn’t worry about running out of cash

The most conservative underwriting guidelines for reserves

  • $1K per unit, one month operating reserves
  • Take reserves out of cashflow ($250/unit/year)
  • Ensure syndicator has access to financing

The importance of planning for worst-case scenarios

  • Use modeling to develop Plan B, C & D

How the passive investor can leverage a sensitivity analysis

  • Analyze variables (i.e.: holding period, interest rates)
  • See where IRR, exit cap lies in different scenarios

Omar’s advice on the exit strategy questions to ask syndicators

  • When/to whom might we sell?
  • Do you have relationships with lenders for refi?

Connect with Omar

Boardwalk Wealth

Email omar@boardwalkweath.com

Call (214) 727-8643

Resources

Rentometer

CoStar

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

  • Download
  • Text “secretbook” to 44222

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Michael on LinkedIn

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‘It is in your moments of decision that your destiny is shaped.’

--Tony Robbins

In my experience, once you truly decide to pursue multifamily investing, it will take 3 to 18 months to do your first deal. In 3 to 5 years, you will have replaced your income and quit your job. And the entire process is set in motion via the Law of the First Deal.

Today, I’m unpacking the powerful Law of the First Deal. I start with its basic principles, offering case studies of podcast guests who were able to replace their income within 3 years and quit their jobs via multifamily investing. I explain why the Law of the First Deal works, describing how investors become deal (and money!) magnets soon after their first closing.

Finally, I walk you through the steps necessary to develop a concrete plan, calculating how long it will take to quit your job—based on your individual Rat Race Number. Listen in for insight on how to leverage the Law of the First Deal to replace your income with multifamily!

Key Takeaways

The principles of the Law of the First Deal

  • First deal is smallest, most difficult
  • Second and third follow in rapid succession
  • Replace income within 2 to 3 years

Case studies of the Law of the First Deal

Why the Law of the First Deal works

  • Magnet for deals, brokers approach with pocket listings
  • Magnet for money, investors who missed out want in
  • Deals get bigger as comfort zone expands

How long it takes to quit your job

  1. Determine average income per unit
  2. Establish how many units you need to cover living expenses
  3. Determine how long it will take
  4. Determine size of first deal

The typical Law of the First Deal timeline

  • First deal in 3 to 18 months
  • Second deal within 6 months
  • Third deal within 6 months
  • Total of 1 to 3 years

The value of establishing a concrete plan

  • Focus on first deal, avoid overwhelm

Resources

ABI EP027 Drew Kniffin

ABI EP 073 Brad Tacia

ABI EP072 Tyler Sheff

ABI EP078 Joseph Gozlan

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Direct download: MB_109-_The_Law_of_the__First_Deal_-_with_Michael_Blank.mp3
Category:Commercial Real Estate -- posted at: 2:02pm EDT

Would you be willing to make 4,500 agonizing phone calls to land your first property? How about going to the trouble of analyzing 100 deals to find one good one? It goes without saying that we have unparalleled opportunities here in the US, but success is unlikely to fall into your lap. So, if you are looking to become a successful multifamily investor, you have to START: Learn to analyze deals properly and get one done.

Andrew Cushman is the principal of Vantage Point Acquisitions, a multifamily investment firm out of Southern California. Andrew has a BS in Chemical Engineering from Texas A&M University, and he worked for a Cargill Foods for seven years before leaving the corporate world for real estate investment. He completed 24 profitable single family flips before making the transition to apartment building acquisitions in 2010. Since then, Andrew has successfully syndicated 1,800 units that continue to provide investors with strong returns.

Today, Andrew joins me to share his story, explaining how an article in the Wall Street Journal inspired his real estate career and why he made the transition from pre-foreclosure flips to multifamily. He walks us through his first deal, a 92-unit property in Macon, Georgia, discussing his mistakes around failing to vet investors and underestimating renovation costs. Andrew offers advice for aspiring investors on beginning with the end in mind, building a network of investors, and partnering for instant legitimacy. Listen in for Andrew’s insight into the benefits of B properties and learn why finding a good deal in the current climate is challenging—but not impossible!

Key Takeaways

How Andrew got into real estate

  • Chemical engineering degree
  • Tried other businesses
  • Article in WSJ re: flipping houses
  • Four years in single family (pre-foreclosures)

Andrew’s shift to multifamily

  • ‘Only as good as last flip’
  • Looking for true financial freedom

Andrew’s first multifamily deal

  • Hired mentor as guide
  • 92-unit deal in Macon, GA
  • 75% vacant, built in 1960’s
  • All-cash syndication ($1.2M raise)

How Andrew financed his first deal

  • Failed to vet investors, lost ¾ of $800K
  • Reached out to entire network
  • Extended closing three times
  • Seller agreed to carry $200K note
  • Raised just enough to close
  • Continued to raise for renovation

What Andrew learned from his first deal

  • Properly screen neighborhood
  • Better estimate rehab costs
  • Better track rehab spending
  • Hire right contractors

Andrew’s advice around doing your first deal

  • Choose deal just outside comfort zone
  • Begin with end in mind, work backwards
  • ‘Don’t buy in the hood’
  • Don’t underestimate rehab costs
  • Learn to analyze deals and get one done

Andrew’s take on the challenge of finding a great deal

  • Must be willing to analyze 100 to find one
  • Don’t look for home run on first deal

Andrew’s insight for aspiring investors who lack capital

  • Start analyzing deals
  • Build network of potential investors (sample deal)

The value in partnering

  • Saves from mistakes
  • Creates legitimacy
  • Go farther, faster

Andrew’s advice to his 22-year-old self

  • Go straight into multifamily
  • B properties = highest return with least effort

Andrew’s perfect day

  • Surf in morning
  • Work at home office
  • Meet wife for lunch
  • Family dinner
  • Work in evening

What Andrew is looking forward to

  • Deal with colleague met at conference
  • Climb, ski Mount Shasta

Connect with Andrew

Vantage Point Acquisitions

Andrew on LinkedIn

Andrew on BiggerPockets

Resources

LoopNet

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

Michael’s Ultimate Guide to Apartment Building Investing

Syndicated Deal Analyzer

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes


At the heart of every successful entrepreneur is a deep sense of spirituality. There is strength in developing a relationship with the higher power, and you must get your ‘being’ right before you can do something truly meaningful.

I recently saw Robert Kiyosaki speak on The Real Estate Guys cruise, and his talk reminded me of the connection between my success as an entrepreneur and my faith. Today, I’m sharing the three spiritual lessons that changed my life and brought me to the work I do now, teaching others to raise money and achieve financial freedom through apartment building investing.

I start by sharing my early success with the software startup webMETHODS, explaining how that experience created the illusion that I was in control of my own destiny. Then I describe the challenges I have faced as an entrepreneur and the three lessons I learned around giving up control, finding peace regardless of the circumstances, and shifting to a mindset of giving. Listen in for insight on the relationship between success and spirituality and learn to step out in faith—and realize an incredibly fulfilling life!

Key Takeaways

The concept of Be Do Have

  • Must get ‘being’ right before accomplish something of meaning
  • Involves character, relationship with God

My early success in tech

  • Joined webMETHODS software startup in 1997
  • Company had most successful IPO in history

Spiritual Lesson #1: You are not in control

  • Left job in 2005 to pursue passive income
  • Bought three restaurants, losing money
  • Realized couldn’t control outcome despite best efforts
  • Surrendered control and sales increased by $4K in four weeks

Spiritual Lesson #2: Find peace regardless of the circumstances

  • First apartment deal in 2011
  • ‘Professional tenant’ sued in housing court every six weeks
  • Attorney fees, fines and no rent coming in
  • Found sense of peace and tenant dropped all charges

Spiritual Lesson #3: Shift to a mindset of giving

  • Profit margins on restaurants shrinking in 2013
  • Had to let VP go, running pizzerias myself
  • Losing $10K/week, all money deployed
  • Spent time reflecting on when felt most alive
  • Idea to start online business teaching multifamily
  • Motivation to help others brought success

The relationship between success and spirituality

  • Relationship with God provides strength
  • Great things happen when step out in faith

Resources

The Real Estate Guys Events

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

Damion Lupo on Apartment Building Investing

The Untethered Soul: The Journey Beyond Yourself by Michael A. Singer

Uganda Counseling and Support Services

Financial Freedom Summit

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Mario Ortiz’s first multifamily deal wasn’t a homerun. Would he do things differently, knowing what he knows now? Maybe wait for a better deal to come along? Mario says no, arguing that ‘getting in the game’ is more important than the size or quality of the first deal. In fact, he lives by the adage that the ‘opportunity of a lifetime’ comes about once a month. The thing is, you have to be looking for it.

Mario is a mechanical engineer from El Paso, Texas. He has managed to build a thriving real estate business while working full-time in the oil industry—without employing syndication. A self-made, resourceful entrepreneur, Mario finds a creative way to finance each new multifamily property, and he made a cool $4M on the refi of his most recent investment!

Mario sits down with me to explain how the unpredictable nature of the oil and gas industry inspired him to pursue real estate. He shares his initial plan to invest in single-family properties and the overwhelm he experienced self-managing 10 homes on top of his full-time job. Mario walks us through his first multifamily deal, describing his luck in establishing rapport with a local bank and what he learned by self-managing the 17-unit property. He discusses the creative ways he financed his second and third multifamily deals, a 90-unit in Houston and a 180-unit in Fort Worth. Listen in for Mario’s insight around ‘getting in the game’ and learn how the refinance of his 180-unit is allowing him to quit his engineering job and travel with his family 

Key Takeaways

Mario’s background

  • Mechanical engineer in oil industry
  • Concerns about stability of job
  • Started with single-family homes
  • ‘Graduated’ to multifamily

Mario’s initial real estate plan

  • 25-30 single-family rentals
  • Replace income in case of layoff

Why Mario’s plan changed

  • Overwhelmed by management of 10
  • Comfortable in full-time job

Mario’s first multifamily deal

  • Found 17-unit in La Marque on Loopnet
  • Established relationship with local bank
  • Hired part-time onsite office manager

Why Mario chose to self-manage

  • ‘Hands-on guy’
  • Cognizant of bottom line
  • Learned leases, eviction processes
  • Gained understanding of multifamily law

Mario’s second multifamily deal

  • 90-unit deal in receivership in Texas City for $1.2M
  • Put 17-unit on Loopnet as owner finance
  • Borrowed from 401(k)
  • Hired manager to help get rid of bad element
  • Sold 18 months later for $2.4M

Mario’s third multifamily deal

  • 180-unit deal in Fort Worth for $3.65
  • Enamored by deal, ignored warning signs
  • Lost $20K/month for first eight months
  • Economic occupancy 65%, physical occupancy 85%

How Mario made the 180-unit profitable

  • $400K in cash reserves
  • Got rid of tenants not paying (65%)
  • Rehab took three years

The refinance of Mario’s 180-unit property

  • Valuation at $10.9M (75% LTV)

Mario’s plan moving forward

  • Actively looking for properties in $10-15M range
  • Invest proceeds from refi in another property

Mario’s plans to leave his full-time job

  • Challenge to give up perceived benefits
  • Looking forward to running real estate business
  • Opportunity to travel with family

Mario’s parting advice

  • Starting more important than size/quality of deal
  • ‘Get in the game’

Connect with Mario

Email mortiz9991@yahoo.com

Resources

Loopnet

Financial Freedom Summit

Partner with Michael

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Michael’s Course

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

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What’s differentiates a successful multifamily real estate investor from someone who dreams of financial freedom but doesn’t take action? Todd Fox contends that a willingness to fail is what sets him apart and that his failures have helped him learn, grow and gain the confidence to go out and create the next big opportunity.

Todd is the CEO of Visum Development Group. In the last 15 years, Todd has developed $35M in projects in the Ithaca metro area, and he oversees all aspects of the firm’s projects from concept formation to long-term stabilization. Visum specializes in new construction and the redevelopment of residential properties, working to maximize returns while mitigating risk for investors. The company offers a range of luxury student housing, residential and commercial investments, and they are currently working on a 207-bedroom student housing project for Cornell University worth $37M.

Todd joins me share his journey from bankruptcy to successful developer, discussing how that dark time inspired him to pursue real estate full-time. He explains how he got his start with duplexes, purchasing his first property at auction and doing an incredible amount of legwork to find the second property—three years later. Todd describes his original intention to scale up to ten duplexes and how his dreams got bigger as he gained confidence and secured a network of investors. Listen in for Todd’s insight on following your heart, learning from failure, and setting small goals to build momentum.

Key Takeaways

Todd’s path to real estate development

  • Quiznos franchise for three years
  • Bought property at auction, redevelop as duplex
  • Internet startup in NYC
  • Eight years of full-time real estate

What inspired Todd to pursue real estate full-time

  • Making $20K/year on duplex
  • ‘What if I owned 10?’

Todd’s painful experience with bankruptcy

  • Personal guarantee on Quiznos lease
  • Next owner stopped paying rent
  • Sued for $482K
  • Questioned path of entrepreneurship

How Todd overcame the inability to secure a bank loan

  • Confident in ability to build product, find deals
  • Promised partner double usual return in exchange for financing

How Todd found his next deal

  • Looked through tax maps for parcels
  • Letters, door-knocking
  • Found house and double-lot worth $500K for under $300K
  • Rented house, built two new duplexes on lots

Todd’s decision to scale beyond ten duplexes

  • Mastered renovations, duplexes
  • Opportunity to build six-unit
  • Raised $750K, on-time and on-budget
  • Now working on $37M building

The organic way Todd built a network of investors

  • Father of tenant in first duplex in student housing business
  • Reached out with interest in investing, hit it off
  • Brought in friends as deals grew

Todd’s approach to raising money

  • Properties under contract before money raised
  • Ability to flip contract in worst-case scenario
  • Trust investors to support (calculated risk)

Todd’s advice for aspiring real estate investors

  • Learn from failure, gain confidence
  • Follow your heart, do what you love
  • Don’t be afraid to fail

Todd’s insight on what sets successful entrepreneurs apart

  • Understanding that it’s okay to fail
  • Willingness to do things that are uncomfortable
  • Set small goals and build momentum
  • Don’t wait for big opportunity, go out and create

Connect with Todd

Visum Development

Visum on Facebook

Visum on Instagram

Resources

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

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The two biggest issues multifamily owners face are turnover and resident satisfaction. If a property is not at full occupancy, your bottom line takes a significant hit. How can you address both of these issues and create a community in your apartments that makes residents want to stay, even if the rents go up?

Pete Kelly is the CEO of Apartment Life, a faith-based nonprofit motivated by a commitment to building relationships and community. Apartment Life serves the multifamily industry, redefining the resident experience in order to increase retention, improve tenant satisfaction, and enhance the community’s online reputation.

Pete sits down with me to share his background in the nonprofit world, explaining the basics of Apartment Life as an organization. He discusses the research around loneliness and public health, customer engagement and brand loyalty, and the economic impact of the CARES Program. Pete offers the specifics of what the CARES and Workforce Housing teams do to engage residents and how the faith-based roots of the organization impact their mission. Listen in for Pete’s insight on building a community that is good for the human soul AND the bottom line.

Key Takeaways

Pete’s background in the nonprofit world

  • 24 years with organization serving young people
  • Two years as CEO of Apartment Life

The fundamentals of Apartment Life

  • Relationships good for soul AND bottom line
  • Friendships increase chances of staying
  • Team hosts events, creates ‘sticky community’

The research around loneliness and public health

  • 26% more likely to die if feel lonely
  • As bad as smoking, obesity

The business research around connection and engagement

  • Emotionally connected customer 52% more valuable
  • Spend more money more often, loyal to brand

How friendships affect a resident’s willingness to stay

  • Seven friends in complex = twice as likely to renew
  • Neighbors themselves are amenity

The financial benefits of the CARES Program

  • $138K annual value to owner
  • 3 renewals/month

What the Apartment Life teams do

  • Usually husband/wife team that lives on-site
  • Events to connect residents
  • Opportunities to care (e.g.: baby gift, ride to airport)
  • Visit tenants 90 days before lease renewal
  • Build positive online presence for community

The cost of the CARES Program for owners

  • Provide 2BR/2BA unit for CARES Team
  • Management fee of $650 to Apartment Life
  • Budget for events ($2/door)
  • Best for A/B Class properties, at least 250-units

The alternative Workforce Housing Program

  • Class C properties in lower income communities
  • Team lives off-site, paid hourly
  • Manages requirements for LIHTC

The faith-based element of Apartment Life

  • ‘Love thy neighbor’
  • Recruit teams from local churches
  • Follow Fair Housing Act guidelines

The mission of Apartment Life

  • Dramatic impact on residents’ lives

Connect with Pete

Apartment Life

Email petekelly@apartmentlife.org

Resources

‘Why Loneliness May Be the Next Big Public-Health Issue’ in Time

‘Loneliness and Social Isolation as Risk Factors for Mortality’ in Perspectives on Psychological Science

‘The New Science of Customer Emotions’ in Harvard Business Review

CARES Program Financial Impact Analysis

Low-Income Housing Tax Credit Guidelines

Fair Housing Act

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes


When Mike Hambright first got into real estate investing ten years ago, he was hesitant to meet his competition. But Mike is an extrovert by nature, and after having coffee with a fellow investor, his perspective shifted. Now he advocates an abundance mentality, and Mike firmly believes that meaningful conversations with high-level players can take your game to the next level. So how do you build a network of investors you respect who can help you learn and grow?

Mike is the Chief Nerd at FlipNerd, a leading resource and social platform for real estate investors with more than 100K subscribers and 1500-plus video shows published to date. He is also the Owner and President of Evolution Properties, a multimillion-dollar firm focused on residential real estate in the Dallas market. Mike has an abundance mentality and a knack for networking, serving as a mentor to aspiring investors and founding the Investor Fuel mastermind.

Mike joins me to discuss his shift from the corporate world to full-time real estate investing, explaining how his wife inspired him to quit dabbling and go all-in in the summer of 2008. He shares his pursuits beyond investing, including his talent for connecting people through the FlipNerd platform. Mike gets granular on the value of a thriving network, describing the opportunities to do deals together and how connections can take your game to the next level. Listen in for Mike’s advice around expanding your real estate network and building meaningful relationships to accelerate your success. 

Key Takeaways

Mike’s shift from corporate to real estate

  • Entire team fired from large retail company
  • Moved to DC, company filed for bankruptcy
  • All-in on real estate summer of 2008

Mike’s ‘go big or go home’ mentality

  • Burning through capital, COBRA insurance
  • Wife said ‘you need to fix this’
  • Treat like business, laser focus
  • Bought 65 homes in first year

How Mike has expanded beyond investing

  • Still active, maintains rental portfolio
  • Ran HomeVestors franchise
  • Added coaching, FlipNerd

The benefits of the FlipNerd platform

  • Created to learn, provide resource
  • Added benefit of establishing network

The value of a thriving network

  • Opportunity to do deals together
  • Relationships accelerate progress
  • Meaningful conversations at events

Mike’s insight on masterminds

  • High-level people take to next level
  • Apply tips, tricks to your business
  • Expand limits of what’s possible

How to expand your network

  • Real estate clubs, podcasts
  • Local Facebook groups
  • Find people and ask questions

What Mike is looking forward to

  • Continued success of Investor Fuel
  • Freedom of virtual team
  • Building relationships

Connect with Mike

FlipNerd

FlipNerd on Facebook

Mike on Facebook

Resources

Investor Fuel

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

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

Review the Podcast on iTunes


Ben Risser had a bad case of entrepreneurial ADD. He knew that the corporate environment was not a good fit for his personality, and he knew that real estate was the route he wanted to take. But Ben couldn’t get focused on a single strategy. He looked into several different single-family alternatives and even pursued lease options for awhile, but he couldn’t seem to stick with one strategy long enough to see it through… And then he landed on multifamily.

Ben enrolled in the Ultimate Guide to Buying Apartment Buildings with Private Money course and started networking at local REIA meetings. Through a random series of events, he ran into his partner, Matt Faircloth, and started underwriting deals. Matt’s broker connections led the team to a 198-unit deal in Fayetteville, NC—a D property in a B neighborhood with big value-add potential. It took six months and lot of legwork, but Ben and Matt closed in January of 2018, and they are actively pursuing other multifamily opportunities in the southeast US.

Ben sits down with me to explain how he came to realize that he is an entrepreneur at heart, despite his background as an aerospace engineer. He discusses his lack of focus early on and how he finally made the commitment to multifamily. Ben shares the story of his unintentional leap into full-time investing and the value of his wife’s support in pursuing the real estate business. Listen in for Ben’s insight around perseverance, focus, and finding a partner with a complementary skill set.

Key Takeaways

Ben’s introduction to real estate

  • Worked at Boeing as aerospace engineer
  • Creativity not valued, stumbled into Kiyosaki
  • Real estate to build pipeline vs. carry buckets

Ben’s initial real estate strategy

  • Liked idea of rentals, passive income
  • Zoomed in on single-family (analysis paralysis)
  • Pursued lease options, burned by partner

Ben’s shift to multifamily

How Ben found his partner

  • Matt presented at credit/investor meeting
  • Follow up, persistence led to partnership

Ben and Matt’s partnership

  • Matt raises equity, focus on big picture
  • Ben does underwriting, loan process
  • Complementary personalities

Ben’s first multifamily deal

  • 192-unit in Fayetteville, NC
  • D property in B neighborhood
  • $6.65M purchase, $1.7M CapEx
  • 24% rent increase

Why it took 12 months to close on the property

  • Offered $6.59M in July
  • Seller initially accepted higher offer
  • Renegotiated for $6.65M
  • Runway to raise equity, get financing

The complications Ben encountered in his first deal

  • Laundromat next door necessitated Phase II ESA
  • Changed lenders twice

How Ben and Matt raised money for the deal

  • Established network in Trenton, NJ
  • $3.2M equity raise

Ben’s transition to full-time syndicator

  • Laid off from small engineering company
  • ‘At peace’ about pursuing real estate

What’s next for Ben and his partner

  • Value-add on property, 20 units available
  • Actively seeking opportunities in southeast
  • Property manager instrumental in due diligence

Ben’s advice for aspiring real estate investors

  • Perseverance is key
  • Focus on one strategy

Connect with Ben

Email b.risser@providencecapital.org

Resources

Rich Dad Poor Dad by Robert Kiyosaki

REIA

Strategic Management Partners

Financial Freedom Summit

Partner with Michael

Invest with Michael

Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


Would you like to save ten years or so and get right to the financial freedom part of real estate investing? Corey Peterson is finally living what he calls the ‘Sunsets and Palm Trees’ lifestyle, but his path was not an easy one. Like many a real estate investor before him, Corey got into the fix and flip business, and while he looked successful on the outside, he was a wreck on the inside. Running rehabs was running him ragged, and he was spending his Saturdays with contractors—instead of his family. Corey knew he had to do something differently, and that’s when he made the transition from single- to multifamily real estate.

Today, Corey is the owner of Kahuna Investments, a multifamily firm that provides its investors with stable cashflow and long-term capital appreciation. Since 2011, Corey has been involved in the ownership and management of commercial properties worth a total of $31M, and he is a sought-after speaker in the multifamily investing space. Corey is the also the host of the Multi-Family Legacy Podcast, and he has been featured on FOX, CBS, ABC and NBC affiliates.

Corey joins me to share his story, explaining how ‘Bruce Wayne’ introduced him to real estate and how being fired from his job as a financial advisor inspired his commitment to full-time investing. He walks us through the ‘hustle and grind’ of his years in the fix and flip business, describing the Saturday he missed his son’s game and how that feeling of failure motivated Corey’s transition to multifamily. He addresses how he developed a talent for raising private money and how that translated to a partnership and his first multifamily deal. Listen in for Corey’s advice around skipping the single-family step and shaving ten years off your journey to financial freedom!

Key Takeaways

Corey’s introduction to real estate

Why Corey got caught in the fix and flip trap

  • TV portrayals
  • Quick money

How Corey made the commitment to full-time real estate

  • Fired from job as financial advisor
  • Learned to raise private money
  • Went back to fix and flips

Corey’s shift to multifamily

  • Missed son’s Saturday game
  • Spent year establishing framework
  • Informed investors of change
  • Announcement at multifamily event

Corey’s first multifamily deal in 2011

  • Partners had deal, needed $1.4M
  • Sold for $8.8M in 2017
  • 1031 exchange for $12.7M deal
  • $400K for rest of life

Why Corey encourages investors to do multifamily

  • Focus on raising money, underwriting deals
  • Easier to get loans, can hire third-party manager

Corey’s advice for aspiring real estate investors

  • Avoid fix and flips (require hustle and grind)
  • Work toward multifamily cashflow
  • Look for working man’s complex
  • Provide world-class service (maintenance, management)

Corey’s tips around raising money

  • Ask, ‘Who do you know?’
  • Right people will self-select

Corey’s insight on mentoring and partnerships

  • Seek out partners at events
  • Look for complementary skill set

What Corey’s excited about

  • Opportunities in marketplace as interest rates rise

Connect with Corey

Kahuna Wealth Builders

The Multi-Family Legacy Podcast

Resources

Rich Dad Poor Dad by Robert Kiyosaki

Financial Freedom Summit

Partner with Michael

Invest with Michael

Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


If you take the time to sit down and get clear on the direction of your life, you may find that growing a business for yourself and your family will afford you the flexibility and time to pursue hobbies, to travel, to spend time with the people you love—and build wealth in the process. More often than not, time invested in reflection is what ultimately inspires action among aspiring multifamily investors.

Scott Price and his wife Karen run Bonvolo Real Estate Investments. They have been investors since 2003, owning and managing multifamily, office, retail and land properties across multiple markets in Washington state. From 2003 through 2007, Scott worked as a broker and earned Seattle Magazine’s Best in Client Satisfaction Award three times before returning to his career in project management. He has steadily grown his real estate portfolio while working full-time at Microsoft, but now he is quitting his W-2 job to focus on Bonvolo full time!

Scott sits down with me to share the experience that distracted him from pursing real estate after college and how the desire for flexibility ultimately brought him back. He explains why he went straight to multifamily as an investment strategy, how he was able to overcome his inexperience, and the business plan for his first 29-unit property. Listen in as Scott reflects on how a lack of awareness about syndication led to slow growth and addresses his plans to give back to the community now that he does real estate full time.

Key Takeaways

Scott’s introduction to real estate

  • Research around creating wealth
  • Real estate tangible source of income

When Scott first took action in real estate

  • Rented condo, had bad tenant
  • Distracted by day-trading, stocks

Why Scott returned to real estate

  • Desire for flexibility, work for self
  • Build considerable net worth
  • Time to travel with family
  • Sense of satisfaction

Scott’s initial real estate strategy

  • Focus on multifamily
  • Conservative approach

Why Scott went straight to multifamily

  • Confident in education, team
  • Sold home and downsized
  • Used cash for down payment on 29-unit

The initial challenges Scott faced in multifamily

  • Tried to do everything alone early on
  • Growing portfolio with own funds

How Scott overcame his inexperience

  • Point to experience of team
  • Technical understanding through education

Scott’s first 29-unit deal

  • Found on MLS, matched available down payment
  • Aware of capital requirement after purchase

Scott’s business plan for creating value

  • Rebrand to change community perception
  • Responsive to tenants, take care of property

What’s next for Scott

  • Actively looking to buy
  • Pursue syndication

Scott’s advice for his younger self

  • Start early, start big and jump in
  • One bad tenant not representative of business

Why Scott was too conservative early on

  • Lack of awareness re: syndication

Scott’s challenges around syndication

  • Concern as steward of other people’s money
  • New world of larger properties

Scott’s guidance for aspiring investors

  • Give a little, downsize if possible
  • Consider living in property to start
  • Redeploy equity in own house
  • Use yours AND other people’s money

What Scott is looking forward to

  • Working full-time in real estate
  • Time for family, hobbies
  • Financing sculpture park project in community

Connect with Scott

Bonvolo Real Estate Investments

Email scott@bonvolo.com

Resources

The Miracle Morning by Hal Elrod

Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


We’ve been conditioned to believe that a steady paycheck is a safety net. That if we pay our dues, the company we have been loyal to will return the favor, and we will ultimately be rewarded with a hefty 401(k).

But Clayton Morris contends that the opposite is true: As long as you for someone else (no matter how prestigious your job may be) consider yourself a line item on a spreadsheet with zero control of your own destiny—who could lose your livelihood at any time, through no fault of your own.

Clayton left a lucrative position as the weekend anchor for Fox & Friends to become the Founder and President of Morris Invest, a firm dedicated to helping people build financial freedom through real estate, and the host of the Investing in Real Estate Podcast. No matter how prominent his work in broadcasting, Clayton knew that his life wasn’t truly his own. He used real estate as the vehicle to gain financial freedom, and now he is on a mission to share his secret sauce with aspiring investors.

Clayton joins me to explain why he left a successful broadcasting career to pursue real estate full time. He shares how a flight to New Zealand inspired him to start a single-family portfolio and what motivated him to get serious about leveraging real estate to replace his income. Clayton addresses the significance of a strong WHY and the limiting beliefs that held him back early on. Listen in for Clayton’s advice around taking massive action and gaining clarity through whitespace.

Key Takeaways

Why Clayton left broadcasting for real estate

  • Power of controlling own destiny
  • Vitriolic politics, death threats

How Clayton decided on real estate

  • Met investor on flight to New Zealand
  • Followed formula to buy properties

Clayton’s initial investment strategy

  • Class C single-family, hardworking neighborhoods
  • Fall in love with ROI rather than real estate
  • Bought two properties, $800/month cashflow

When Clayton got serious about real estate

  • Couldn’t pay mortgage on NJ home
  • Calculated freedom # (12 single-family)
  • Got creative with money to acquire properties

Clayton’s last day of work

  • Didn’t want any part of destructive political narrative
  • Looking forward to spending weekends with family
  • Cleaned out office and didn’t look back

Why Clayton is making the shift to multifamily

  • Infinite returns, tax incentives

What held Clayton back

  • Fear of success, father never took action
  • Had to put on blinders, stick to one thing

The myth that a steady paycheck is a safety net

  • Average 401(k) only $90K
  • ‘Pawn on chessboard’

Clayton’s advice around taking action

  • Put together battle plan (one strategy)
  • People, deals and money

What Clayton is looking forward to

  • Multifamily investments
  • Writing book (mindset)
  • Creating more whitespace

Connect with Clayton

Morris Invest

Clayton’s Website

Clayton’s Podcast

Clayton on Facebook

Clayton on Twitter

Clayton on Google+

Clayton on YouTube

Resources

Freedom Number Cheat Sheet

REIA

Jeff Goins Mitigated Risk Article

Michael on Investing in Real Estate

Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


As multifamily investors, it is easy to get caught up in making as much money as possible. Problem is, we sometimes forget that real people live in those apartment buildings. And regardless of their socioeconomic level, our tenants deserve to be treated with dignity and respect.

Eddie Lorin is a multifamily real estate investor with 20 years of value-add experience and 40K units under his belt. Eddie’s company, Impact Housing, is on a mission to breathe new life into neglected multifamily properties, generating positive returns for investors and improving the quality of life for residents and surrounding communities.

Eddie sits down with me today to share his vision for Impact Housing and the critical need for clean, affordable housing for the working class. He explains the concept of impact investing, discussing how he takes care of people ‘where they live’ by way of Class A amenities and on-site programming. Eddie speaks to his expectations for third-party property managers, describing the art and science of building a community. Listen in as Eddie offers the business argument for his model and learn how to do well by doing good.

Key Takeaways

Eddie’s vision for Impact Housing

  • Changing people’s lives where they live
  • Safe, affordable housing for working class
  • Tenants stay, pay and refer friends

The concept of impact investing

  • Doing business for a purpose
  • Millennials leading paradigm shift
  • Working poor in distressed areas

What’s different about Impact Housing

  • Focus on resident rather than deal
  • Treat tenants with dignity, respect
  • Provide Class A amenities

How Eddie takes care of his residents

  • Signage, pool and fitness center
  • Health, wellness classes
  • Create sense of community

What Eddie requires of third-party property managers

  • Budget set aside for activities, amenities
  • Respond to work orders within 48 hours
  • Build relationships with tenants

The business argument for Eddie’s model

  • Big demand for affordable housing
  • Safe, defensive investment

What Eddie’s looking forward to

  • Deal in Maryland (townhomes)
  • Environmental, social and financial return

Connect with Eddie

Impact Housing

Email info@impacthousing.com

Resources

The Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes

Direct download: MB_098_-_Do_Well_By_Doing_Good_-_With_Eddie_Lorin.mp3
Category:Commercial Real Estate -- posted at: 7:07pm EDT

‘The guy or the gal that wants to quit their job and doesn’t is quitting themselves.’

What is the secret sauce that makes a person successful? Michael Quarles says that it’s not about hoping, wanting or even needing to reach your goals. You have to REQUIRE yourself to take action every day in order to achieve. And even that’s not enough if you don’t have self-respect.

Michael is a serial entrepreneur and accomplished real estate broker and investor who purchased his first property at the tender age of 18. He has completed thousands of real estate deals, and Michael has vast experience with fix and flips, assignments, and wholesale deals. In addition, he designed a systematized business model that his team uses to purchase houses across the country through 1800Sell4Cash. Michael also developed Yellow Letters, the largest marketing company for real estate investors, as well as the Alex & Ryan Call Center, a service that turns marketing responses into deals.

Today, Michael joins me to discuss his high-level strategy for lead generation. He explains the value of cluster marketing, his strategies for converting leads over the phone, and the process of locating leads without the help of a broker. Michael walks us through his criteria for choosing a market and how he handles due diligence without the luxury of seeing a property in person. Listen in for Michael’s insight on why self-respect is the key to success and his ‘taste the caviar’ challenge for aspiring investors.

Key Takeaways

Michael’s high-level strategy for lead generation

  • Sweat marketing (i.e.: new, sports, purses and shoes)
  • Paid marketing (e.g.: signage, billboards and direct mail)

The value of cluster marketing

  • Send six different letters, postcards
  • Increased probability of call back

Michael’s techniques for converting leads on the phone

  • Imbedded commands
  • Positive, negative reinforcement
  • Pacing
  • Neural linguistics

Michael’s take on the art of negotiation

  • Teach what you want them to say
  • Legal, moral and ethical conduct

Michael’s best suggestions for lead sources

Michael’s criteria for choosing a market

  • 2/3 median
  • High percentage of cash investor buyers
  • Stable number of single-families per zip code
  • High foreclosure rate

Michael’s call center personas

  • Alex—answers phone
  • Ryan—negotiators
  • Angel—negotiates terms

How Michael does due diligence without seeing a property

  • Broker’s price opinion
  • Ensure dealing with owner
  • Appraisal
  • Home inspection
  • Request pictures

Michael’s insight on what it takes to be successful

  • Want, need and hope are not enough
  • Must REQUIRE yourself to achieve
  • Self-respect to push through pain

Michael’s ‘taste the caviar’ challenge

  • See what it feels like to experience success

The value in surrounding yourself with the right people

  • Choose people where you want to be

Connect with Michael

Michael’s Website

Email michael@michaelquarles.com

Yellow Letters

1800Sell4Cash

Call Center

Resources

ListSource

Fidelity National Title

The Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


‘The guy or the gal that wants to quit their job and doesn’t is quitting themselves.’

What is the secret sauce that makes a person successful? Michael Quarles says that it’s not about hoping, wanting or even needing to reach your goals. You have to REQUIRE yourself to take action every day in order to achieve. And even that’s not enough if you don’t have self-respect.

Michael is a serial entrepreneur and accomplished real estate broker and investor who purchased his first property at the tender age of 18. He has completed thousands of real estate deals, and Michael has vast experience with fix and flips, assignments, and wholesale deals. In addition, he designed a systematized business model that his team uses to purchase houses across the country through 1800Sell4Cash. Michael also developed Yellow Letters, the largest marketing company for real estate investors, as well as the Alex & Ryan Call Center, a service that turns marketing responses into deals.

Today, Michael joins me to discuss his high-level strategy for lead generation. He explains the value of cluster marketing, his strategies for converting leads over the phone, and the process of locating leads without the help of a broker. Michael walks us through his criteria for choosing a market and how he handles due diligence without the luxury of seeing a property in person. Listen in for Michael’s insight on why self-respect is the key to success and his ‘taste the caviar’ challenge for aspiring investors.

Key Takeaways

Michael’s high-level strategy for lead generation

  • Sweat marketing (i.e.: new, sports, purses and shoes)
  • Paid marketing (e.g.: signage, billboards and direct mail)

The value of cluster marketing

  • Send six different letters, postcards
  • Increased probability of call back

Michael’s techniques for converting leads on the phone

  • Imbedded commands
  • Positive, negative reinforcement
  • Pacing
  • Neural linguistics

Michael’s take on the art of negotiation

  • Teach what you want them to say
  • Legal, moral and ethical conduct

Michael’s best suggestions for lead sources

Michael’s criteria for choosing a market

  • 2/3 median
  • High percentage of cash investor buyers
  • Stable number of single-families per zip code
  • High foreclosure rate

Michael’s call center personas

  • Alex—answers phone
  • Ryan—negotiators
  • Angel—negotiates terms

How Michael does due diligence without seeing a property

  • Broker’s price opinion
  • Ensure dealing with owner
  • Appraisal
  • Home inspection
  • Request pictures

Michael’s insight on what it takes to be successful

  • Want, need and hope are not enough
  • Must REQUIRE yourself to achieve
  • Self-respect to push through pain

Michael’s ‘taste the caviar’ challenge

  • See what it feels like to experience success

The value in surrounding yourself with the right people

  • Choose people where you want to be

Connect with Michael

Michael’s Website

Email michael@michaelquarles.com

Yellow Letters

1800Sell4Cash

Call Center

Resources

ListSource

Fidelity National Title

The Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


With 3,600 members, Neal Bawa’s multifamily meetup is the largest in the US.

Would you believe that when he started the group, Neal had zero multifamily experience?

Neal’s background is in technology education. He spent 15 years running a traditional company—and paying massive taxes—when his boss turned him on to the tax benefits of multifamily. Neal invested in a handful of single family homes, triplexes and fourplexes to learn the game, and he was ready to take the next step when he learned about a 12-plex deal that he couldn’t afford on his own.

By then, Neal had established his multifamily meetup, where he was candid about the fact that he didn’t have experience. Rather, he shared what he DID know—his research and knowledge of the numbers. And on the night that Neal shared the story of the 12-plex deal, he discovered that he had a knack for raising money as well.

Today, Neal and his partner have 1,000 units, with plans to hit 1,700 by the end of the year. Neal joins me to discuss how he was able to position himself as a leader despite a lack of track record and why his ability to tell the story of a project led to success with raising money. He talks numbers, sharing the importance of understanding the economics of an area before you invest and his take on the top two markets for 2018. Listen in for Neal’s insight around stock market corrections, partnering with experts and diversifying your real estate portfolio.

Key Takeaways

Neal’s transition from single- to multifamily

  • Multifamily scales much better, always the goal
  • Bought single family, tri-/quadplexes to learn
  • Found 12-plex deal, told story in meetup
  • Discovered knack for raising money

Why Neal established a multifamily meetup without a track record

  • Desire to share knowledge, network
  • Honesty re: lack of experience resonated

How Neal’s meetup group supported his growth

  • Encouraged meetup members to form groups (e.g.: underwriting)
  • Learned from each other through open share
  • Experienced future partner joined group

Neal’s advice around avoiding the mistakes he made early on

  • Don’t assume taxes will stay the same
  • Gain understanding of tenant quality

How demographics can impact returns

  • Delinquency levels of African American tenants
  • Marginal difference on western seaboard
  • Three to four times higher in Midwest
  • Vegas as transitional area, high turnover
  • Work numbers into underwriting

Neal’s top market picks with growth and value potential

  1. Sacramento
  2. Orlando

Why multifamily investors should adjust their expectations

  • 23% cash-on-cash returns no longer realistic
  • Interest rates increasing, cap rates decreasing
  • Rent growth slowing down (still above trend)
  • Red flag if syndicator promising same returns

Neal’s take on whether it’s a good time to get into multifamily

  • Anticipate massive housing shortage
  • Gap in supply/demand in Class B, C
  • Once in a lifetime opportunity

Neal’s insight on market corrections

  • Assume will happen, plan for it
  • Returns will drop, but good properties will survive

How multifamily performed in the last recession

  • Better than most asset classes
  • Still had cashflow (down to 4%)
  • Deep crash = opportunity
  • 4% default rate

What’s next for Neal

  • Expand network and diversify
  • Acquire student, senior housing
  • Partner with expert in industrial

Connect with Neal

Multifamily U

Financial Attunement

Email neal@finatt.com

Resources

We Are Apartments

The Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


Wouldn’t it be great if your first multifamily deal just fell into your lap? If someone would just walk into your office and offer you an 18-unit property? If a bank would provide you with 100% financing and 100% renovation?

Sounds great, right?

But the problem with things being too easy is that you don’t learn. Just ask Nathan Tabor. He got lucky on his first multifamily deal—and that led to a lot of misery, stress, and unanticipated setbacks with his second and third investments.

Nathan is an entrepreneur, business consultant, executive coach and speaker. In the last 18 years, he has successfully founded and operated dozens of businesses, grossing over $150M in sales. His experience spans the areas of real estate, auto sales, web-based marketing and direct product sales. Nathan has been a featured guest on Fox News, Laura Ingraham and C-Span, among others, and his parent company was ranked as one of the fastest-growing small businesses in the US by Inc. magazine in 2012, 2013 and 2014.

Nathan has done 26 multifamily deals in the last 11 years, and his current portfolio includes three apartment buildings with a total of 168 units. Today he joins me to share his story, discussing how that easy first deal led to big mistakes with his second and third investments. Nathan walks us through the lessons he learned around financials and zoning and explains why aspiring investors should focus on the first deal. Listen in to understand how his multifamily strategy has changed over time, and get Nathan’s insight on serving others first to achieve lasting happiness.

Key Takeaways

Nathan’s stress-free first deal

  • Opportunity to buy 18-unit complex
  • 100% financing from small community bank
  • Added 12-unit complex nearby
  • Flipped after eight months, made $250K

Nathan’s disaster of a second deal

  • Purchased 24 units for $225K
  • Couldn’t get building permits
  • Lost grandfathering, had to bring up to code
  • Cost $150K more than budgeted
  • 18 months of misery and stress
  • Good investment in long run

Nathan’s multifamily strategy

  • Class C, value-add opportunities
  • Flip OR refinance into nonrecourse debt
  • Current portfolio of three complexes, 168 units

Nathan’s third multifamily deal

  • Rent-roll advertised $28K, only $7K coming in
  • Forced to rework numbers, renegotiate with bank
  • Learned to verify financial via bank statements
  • Eventually sold property, made $800K

The lessons Nathan learned from his mistakes

  • Don’t wait to resolve problems
  • Follow instincts if something feels wrong
  • Seek the advice of mentor/coach
  • Do foundational work to get educated

How Nathan’s multifamily strategy changed over time

  • Started out flipping properties
  • Learned about nonrecourse debt
  • Look for properties that meet nonrecourse criteria
  • Banks started asking for more money down
  • Uses income from flips to finance next deal

Why multifamily appeals to Nathan

  • Monthly income not dependent on working 40 hours/week
  • Opportunity to help people in difficult situation (C class buildings)
  • 90% of tenants just want safe, well-maintained place to live

Nathan’s advice for aspiring multifamily investors

  • Define your niche
  • Develop business plan
  • Start somewhere, build up
  • Work with partner if necessary
  • Focus on the first deal

Nathan’s insight on work-life balance

  • Moments of joy based on money don’t last
  • Take care of health, relationships and faith first

Connect with Nathan

Nathan’s Website

Resources

The Financial Freedom Summit

Michael’s Course

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

Review the Podcast on iTunes


Andrew Campbell was 27-years-old, working a good corporate job when he got the call that his father had suffered a massive brain hemorrhage. So he moved back home to Austin and reconsidered what he wanted out of life.

Flexibility and freedom became priorities for Andrew, and when an experienced friend invited him to partner up on the purchase of a duplex, he agreed. Very quickly, Andrew was ‘addicted to real estate,’ and he began to envision a long-term plan that would allow him to quit his job and pursue real estate full-time.

Now Andrew is a managing partner with Wildhorn Capital, a real estate investment firm focused on multifamily properties in major Texas markets. Today he joins me to share how he made the transition from duplexes and fourplexes to his first multifamily deal, a 192-unit building in San Antonio. Andrew walks us through his first experience with raising money, explaining how being a real estate junkie helped him build a network organically. Listen in for Andrew’s insight on redefining success, taking risks, and leveraging an addiction to real estate to live the life YOU design.

Key Takeaways

How Andrew got into real estate

  • Corporate job out of state
  • Moved home after dad’s massive brain hemorrhage
  • Changed notion of what success looks like
  • Bought duplex with experienced mentor

Andrew’s initial investment strategy

  • Goal to create passive income
  • Envisioned 15- to 20-year plan
  • Add duplexes, fourplexes to portfolio
  • Managed himself to learn business

Why Andrew limited himself to four units or less

  • Qualified for residential loans (up to ten)
  • Model was familiar

 Why Andrew transitioned to multifamily

  • Reaching maximum # of residential loans
  • Realized could realize dreams sooner
  • Wife encouraged him to ‘go for it’

Andrew’s first experience with raising money

  • Client through consulting work offered $100K
  • Gained confidence, snowball effect

Andrew’s first multifamily deal

  • 11 months from decision to close
  • Relationships with brokers in San Antonio
  • Purchased 192-units for $16M ($6.5M raised)

What inspired Andrew to ‘go big’ on his first multifamily deal

  • Property management companies look for 125-plus
  • More efficient to go bigger

How Andrew was able to raise $6.5M

  • ‘We networked our asses off’
  • Five meetings/week with new people

Why Andrew chose to work with a partner

  • Sees real estate as ‘team sport’
  • Met at conference, same business model/markets
  • Complementary skill sets (both intense hustlers)

 What’s next for Wildhorn Capital

  • Strategic, disciplined to find deals that work
  • Goal to expand to 1K units in 2018

How Andrew’s life is different as a full-time investor

  • ‘Life by design’
  • Flexibility, freedom
  • Feels he can do/achieve anything
  • Full-time job no longer in way

Andrew’s advice to aspiring multifamily investors

  • Start buying property now
  • Don’t be afraid of value-add
  • Don’t be afraid to use other people’s money
  • Take ownership, risks

Connect with Andrew

Wildhorn Capital

Email andrew@wildhorncap.com

Resources

The Millionaire Real Estate Investor by Gary Keller, Dave Jenks and Jay Papasan

Rich Dad Poor Dad by Robert T. Kiyosaki

Michael’s Course

Michael’s Contact Form

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

Review the Podcast on iTunes

Direct download: MB_094_-_Life_by_Design_with_Andrew_Campbell.mp3
Category:Commercial Real Estate -- posted at: 3:10pm EDT

You’ve been served.

Those are scary words for a real estate investor, but the truth is that you are likely to face a lawsuit at some point in your career—take it from me. So how do you keep your assets safe and protect yourself from frivolous litigation?

Scott Smith is an attorney as well as a real estate investor. His firm, Royal Legal Solutions, provides business, tax and legal solutions geared exclusively for real estate investors. Scott has eight years of experience deconstructing the industry, and asset protection is his specialty.

Today Scott covers the statistics around lawsuits in the real estate investing space, explaining his ‘if, not when’ approach to protecting yourself as a real estate investor. He shares case studies of investors who were not protected and walks us through the benefits of hiding and isolating your assets. Scott offers his best strategies, including separating operations from ownership, removing equity from your properties, and doing your due diligence—every single time. Listen in and learn how to leverage a series LLC structure in combination with a land trust to remain anonymous and compartmentalize your assets, making you less susceptible to litigation.

Key Takeaways

The focus of Royal Legal Solutions

  • Help real estate investors protect, hide assets
  • Keep retirement, assets safe

The likelihood you will be sued as a real estate investor

  • Most litigated industry in US
  • 3-8% sued every year
  • Almost guaranteed lawsuit during lifetime

The potential outcomes of a lawsuit

  • Prevent by hiding, isolating so client looks unattractive
  • Let insurance company’s lawyers bully into low settlement
  • Insurance only covers negligence (nothing else)

 Scott’s strategies for protecting real estate investors

  • Transfer properties into asset holding company
  • Separate operations from ownership

The level of effort required to open and maintain multiple LLCs

  • Only need one operating company, one asset company
  • Asset holding company can employ series LLC structure
  • Infinite scalability
  • Compartmentalization of every asset
  • Cost to expand goes to zero
  • Move property into land trust (can’t be traced back to you)
  • Creates doubt in mind whether you still own property

Scott’s best advice for real estate investors

  • Separate assets from operations
  • Remove equity from property

Scott’s call-to-action for protecting your assets

  • Remove your name from assets
  • Be sure you’re well-insured
  • Do your due diligence every time

Connect with Scott

Royal Legal Solutions

Email scott@royallegalsolutions.com

Call 512-757-3994

10 Ways to Protect Your Real Estate Investments

Resources

Michael’s Course

Michael’s Coaching Programs

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

Review the Podcast on iTunes


Todd Dexheimer always wanted to be a multifamily investor, but he got distracted by single-family rentals and fix and flips. When he stopped to take a hard look at his portfolio, Todd realized that when it came to return on investment, the rentals were destroying the flips. Worse yet, he was still in a holding pattern—waiting to ‘graduate’ to multifamily. What would his cashflow look like if he stopped wasting time and shifted his focus to apartment buildings?

Todd began his career as a high school teacher, but the meager pay and lack of job satisfaction had him looking for other opportunities. In 2008, he and his wife used their savings to purchase a rental property as well as a live-in flip, and before long he had a significant rental portfolio and 150 flips under his belt. But Todd never stopped dreaming about multifamily, and in 2016 he got back on track and purchased a 22-unit building in Cincinnati. Now he has a total of 106-units and the ambition to grow by another 800 units in 2018.

Today Todd explains how fear, distraction, and a lack of resources held him back from pursuing his multifamily dreams. He shares the details of a 15-unit deal that didn’t go so well, yet taught him several valuable lessons and set him up for future success. Todd discusses how a hard look at his portfolio got him back on the multifamily track and offers an overview of his last two apartment investments. Listen in for Todd’s advice around being taken seriously in a new market and learning from other investors to go big quickly, rather than waiting to ‘graduate.’

Key Takeaways

The Cliff’s Notes version of Todd’s story

  • High school industrial tech teacher
  • Developed interest in real estate
  • Invested in single-family, duplexes and fourplexes
  • ‘Graduated’ to multifamily

The problem Todd was trying to solve with real estate

  • Little job satisfaction in teaching
  • Liked interaction with students, but disliked politics
  • Income not there, not fulfilled by work

Todd’s initial investment strategy

  • Wanted to do multifamily, but lacked resources
  • Found house for $60K, rent at $1,500/month
  • Financed with savings
  • Refinanced properties to buy more
  • Started flipping houses, built rental portfolio

 Todd’s first multifamily deal

  • Bought 15-unit with passive investor in 2013
  • Building had plumbing issues that renovation budget didn’t cover
  • 80% of profits went back into repairs
  • Made money, but didn’t reach expected return

What Todd learned from his first multifamily deal

  • Understand what type of building you’re buying
  • Budget for necessary repairs, replacements
  • Provide investors with appropriate financials
  • Mind your books, understand expenses
  • Don’t get distracted with other projects

What inspired Todd to pursue multifamily again

  • Parted ways with business partner
  • Realized rentals destroyed flips on ROI
  • Conducted market research on multifamily

Todd’s second multifamily deal

  • 22-unit off-market deal in Cincinnati
  • 10% down payment, owner financing
  • Equity, renovation financed through investor

Todd’s approach to being taken seriously in a new market

  • Find commercial brokers through LoopNet, local sites
  • Call to discuss specifics of what you’re looking for
  • Follow up with email asking for recommendations
  • Contact referrals (property managers, lenders, attorneys)
  • Show up face-to-face, spend three days

Todd’s first syndication deal

  • 84-unit building in Lexington, KY
  • Heavy lift value-add ($9K/unit)
  • 88% occupancy, rents low
  • Improving C+ neighborhood
  • 11 investors to raise $800K

The value of the first deal

  • Learning sets up for future success
  • Conservative underwriting = profit (even if things go south)

Todd’s advice to his younger self

  • Get educated in multifamily, investing in general
  • Surround yourself with right people
  • Don’t get distracted from what really want

Todd’s insight for aspiring multifamily investors

  • Okay to do single-family, flips to gain experience
  • Find/learn from apartment investors from day one
  • Go big quicker, don’t wait to ‘graduate’

How Todd’s life changed after he quit teaching

  • Never nervous, very prepared
  • ‘Every day is Saturday’
  • Excited to grow real estate business

Connect with Todd

Venture D Properties

Email todd@venturedproperties.com

Todd on LinkedIn

Todd on Bigger Pockets

Todd’s Podcast

Resources 

Episode 89

LoopNet

Episode 77

Michael’s Coaching Programs

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

Review the Podcast on iTunes


‘Don’t worry about everything you don’t know today.’

Josh Sterling’s advice for aspiring real estate investors? Jump in head first and take massive action. In fact, if Josh could go back and offer some advice to his 17-year-old self, he would recommend skipping college and getting on the fast track to multifamily as soon as possible!

But Josh didn’t know that then, and he pursued a degree in aeronautical science from Embry-Riddle University. He got a job as a commercial airline pilot and had worked his way up to captain when the recession hit, and his hard work was rewarded with a demotion and a pay cut. Josh decided then and there that he needed a side hustle that he could control, and he landed on real estate. Josh was eventually able to quit his job and pursue real estate full-time, growing his portfolio to a cool 250 units.

Josh has also grown his business, building out his own property management team. Today he walks us through his first deals in the single-family space, discussing the challenges of managing 25 properties and how that struggle inspired his shift to multifamily. Josh offers his insight around building relationships with a few good brokers, describing how he has scaled to 250 units with the help of just two realtors. He explains his approach to multifamily syndication, sharing how multifamily allowed him to quit his job, go to work on his own terms, and have lunch with his 18-month old daughter any time he wants. Listen in for Josh’s advice about establishing credibility—with or without a track record—and getting on the fast track to multifamily.

Key Takeaways

What inspired Josh to pursue real estate

  • Working as airline pilot
  • Demotion with pay cut in 2008
  • Looking for something could control

Josh’s first deal in September 2009

  • $40K single-family in southeast Michigan
  • Buy and hold strategy

Why Josh made the shift to multi-family

  • Owned 25 single-family rentals by 2012
  • Needed help with management
  • Multifamily necessary to scale business

Josh’s first multifamily deal

  • Colleague introduced to commercial broker
  • Approached with 24-unit off-market deal
  • Couldn’t get numbers to work, deal fell apart
  • Seller reached out twelve months later
  • Bought under land contract for $515K at 6%
  • Upgraded units, occupancy rose from 42% to 100%
  • Cash out refi after 14 months (valuation at $800K)

Josh’s next multifamily deal

  • Same broker approached with 53-unit deal
  • Used capital from refi of 24-unit property

Josh’s approach to raising money

  • Share enthusiasm for real estate with family, friends
  • Leverage portfolio for credibility

Josh’s first experience with syndication

  • $1.3M building under contract
  • Needed to raise $300K to close
  • Put out sample deal package
  • Fully subscribed in 24 hours

How quitting his day job changed Josh’s life

  • Left in May of 2016 (owned 140 units)
  • Work on own terms to grow business
  • Aggressively looking for deals
  • Fly to play golf, see concerts

What Josh would tell his 17-year-old self

  • Skip college, buying first home
  • Pursue multifamily right away
  • View regular job as means to end

How to fast track a career as a real estate investor

  • Get educated quickly
  • Build relationships with brokers
  • Don’t worry about bank financing
  • Demonstrate credibility to raise equity

What Josh is excited about right now

  • Building own property management team
  • Building self out of day-to-day operations
  • Focus on networking, maintaining broker relationships

Josh’s advice for aspiring real estate investors

  • Take massive action
  • Build reputation, relationships

Connect with Josh

Email: josh@epicpropertymanagement.com

Epic Property Management

Resources

LoopNet

Freddie Mac Small Balance Loan

Entrepreneurs’ Organization

Michael’s Coaching Programs

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

Review the Podcast on iTunes

Direct download: MB_091-The_Fast_Track_to_Multifamily__With_Josh_Sterling.mp3
Category:Commercial Real Estate -- posted at: 12:20pm EDT

If 2018 is YOUR year, the year you plan to do your first multifamily deal and get on the road to retirement, then the next step is to determine the route you will take to get there. There are four different roles you can play in a general partnership: syndicator, passive investor, balance sheet guarantor, or money raiser.

Today I’m getting into the nitty gritty of each of those four paths to financial freedom, exploring what’s important to each member of the team and how to get started. I begin with syndication, discussing the importance of analyzing deals, meeting with investors and building a team. If you want to be in the driver’s seat, then the role of the syndicator may be perfect for you. I go on to cover passive investing, outlining how to ask the right questions and find a partner you can trust. If you see yourself as more of a passenger on this road trip to retirement, then passive investing might be the part you play in a general partnership.

Another lesser-known role is that of the balance sheet guarantor, who cosigns the loan for another syndicator. I explain the circumstances under which a balance sheet guarantor is necessary and the benefits of signing on to a deal in this way. The fourth role is that of the money raiser, and I wrap with the networking skills necessary to take on this role. Listen in and learn the significance of getting educated in the multifamily space, building a working relationship with trustworthy partners, and getting on the road to retirement with apartment building investing!

Key Takeaways

What’s important to becoming a SYNDICATOR

  • Learning to analyze deals
  • Constantly raising money

How to get started as a SYNDICATOR

  • Educate yourself with free content, invest in education
  • Analyze deals, meet with investors and build your team
  • Consider coaching (accelerate results, avoid mistakes)
  • Avoid overwhelm by doing ‘next three things’

What’s important to becoming a PASSIVE INVESTOR

  • Learn right questions to ask
  • Find partner you can trust
  • Transparency, integrity and communication
  • Look at track record, team

How to get started as a PASSIVE INVESTOR

  • Educate yourself enough to ask right questions, call BS
  • Network at events like REIA, meetups or Financial Freedom Summit
  • Find one or two partners, invest in multiple deals

What’s important to becoming a BALANCE SHEET GUARANTOR

  • Required by lender when net worth of partners not > loan balance
  • Willing to cosign loan for syndicator
  • Risk exposure low, compensation varies
  • Can receive 5-15% of general partnership

Who are ideal MONEY RAISERS

  • Have capital themselves, ability to attract more
  • Prefer networking to cold-calling brokers, analyzing deals

What’s important to becoming a MONEY RAISER

  • Access to capital
  • Finding trustworthy partner

How to get started as a MONEY RAISER

  • Educate yourself enough to answer questions
  • Start raising money TODAY

Resources

Partner with Michael

Invest with Michael

Deal Maker’s Mastermind

Syndicated Deal Analyzer

Sample Deal Package

Ultimate Guide to Buying Apartment Buildings

Michael’s Coaching Programs

Financial Freedom Summit

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

Review the Podcast on iTunes

Direct download: MB_090_-_3_Ways_To_Retire_With_Multifamily_-_Michael_Blank.mp3
Category:general -- posted at: 3:10pm EDT

When I went along on my real estate journey and—all of a sudden—apartments became the thing that I wanted, there was a level of excitement that I had not experienced before... I imagine myself owning many apartment buildings, and that’s the vision I’ve set for myself.’

In December of 2016, veteran Seattle police officer David Sweeney turned 53. After a 30-year career, he had reached the minimum retirement age, but David knew he could not stop working if he wanted his family to have a comfortable life. Looking for new options for himself and his family, he started exploring real estate. David liked the ring of ‘multi-family investor,’ so he started looking for duplexes, triplexes and fourplexes. By April, he had secured his real estate license to gain access to the MLS, and he spent the next five months evaluating 400-plus deals.

Though a few deals fell through, David was motivated by his goal. He refinanced his own home and pulled $380K—and waited for the right opportunity. By August, David had started thinking bigger, and when he came across a 24-unit property in Centralia, he made an offer that was accepted. Now David is looking for his next deal and looking to help other aspiring investors find deals of their own. Today he shares his process for analyzing deals and how he made the mindset shift from pursuing duplexes, triplexes and fourplexes to apartment buildings. He discusses the challenges he faced in getting a loan and how he leverages his commercial lender as a ‘second set of eyes.’ Listen in for David’s bold 2018 goals and his advice for aspiring investors around increasing your productivity through purpose!

Key Takeaways

 [0:40] The trigger that moved David to pursue real estate

  • Turned 53 last December (minimum retirement age)
  • Wanted new options for self, family

[2:15] David’s initial strategy

  • Consumed much info, liked idea of multi-family
  • Initial goal to purchase duplex, triplex or fourplex in western Washington

[4:32] How David moved forward toward his goals

  • Started shopping on real estate sites
  • Couldn’t find information he wanted
  • Secured real estate license in April
  • Evaluated 400 deals via access to MLS
  • Narrowed down to properties with potential cashflow
  • Used syndicated deal analyzer to determine offer

 [8:16] David’s mindset from April through August

  • Motivated by goal
  • Not too frustrated by deals that fell through
  • Refinanced house, pulled $380K
  • Waiting for right opportunity

[10:28] David’s shift to thinking big

  • Came across larger deal
  • Four duplexes vs. one apartment building
  • Benefit of dealing with one roof, contractor
  • Ventured into commercial financing
  • Experience expanded comfort zone

[15:58] David’s first deal

  • 24-units (16 1BR, 8 studio) in Centralia, WA
  • Came with 15-unit storage facility, single-family home
  • Listed at $1.325M, looked at cap rate in area
  • Offered $1.1M, took for $1.14M
  • Received real estate commission as well

[19:08] David’s goals for 2018

  • Buy 100-unit property
  • Learn more about raising money
  • Help other people find deals
  • Eventually become passive investor

[22:16] The challenges David faced in doing his first deal

  • Acquiring commercial loan
  • Getting insurance
  • Roof inspection

[24:28] How David’s first deal is performing

  • $3,700-$4,000/month in pocket (after expenses)
  • Increase property value

[26:57] David’s advice for aspiring real estate investors

  • Do more tomorrow that you did today
  • List your goals, take steps daily
  • Move from education to action
  • Productivity increases with purpose

Connect with David Sweeney

David’s Website

Resources

Syndicated Deal Analyzer

Think and Grow Rich by Napoleon Hill

Podcast Show Notes

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

Review the Podcast on iTunes


Analysis paralysis? A fear of failure? Too many other responsibilities? Procrastination? The idea that you’re not good enough?

What’s holding you back from FINALLY making the decision to live the life of your dreams? What if you could overcome these limiting belief systems, otherwise known as BS, and take action on your goals? What if you could totally crush it in 2018?

Rod Khlief is an authority in real estate, business and peak performance. He has personally owned and managed 2,000-plus apartments and homes, building more than 22 businesses in his 40-year career. But it wasn’t until he lost his shirt in the recession that Rod learned how to build a successful life that had richness and meaning—with a focus beyond himself. Now he combines his passion for real estate investing with his understanding of ‘the psychology of success’ to serve as one of the country’s top real estate investment and high-performance life coaches.

Today Rod shares how he came back from the experience of losing $50M and why he is a better person for it. He walks us through his goal-setting methodology, explaining how to develop a WHY for each objective and the value of finding images associated with each of your goals. Listen in for Rod’s insight around truly deciding, overcoming fears and discouragement, and taking action on your goals. Learn how to leverage the Dickens process to change your mindset and the value in realizing it’s not all about you.

Key Takeaways

 [1:31] Rod’s $50M seminar

  • Owned 800 C- single-family houses in Florida
  • High taxes, insurance minimized cashflow
  • Ugly, painful setback during recession

[5:05] What Rod learned from the experience

  • Giving to others provides richness, meaning
  • Success without meaning beyond self is empty

[9:17] Rod’s methodology around goal-setting

  • Write down everything you could possibly want in life
  • Material things
  • Skills to learn
  • Who you want to help
  • Put a number next to each item (how long to achieve)
  • Pick a #1 goal and your top three one-year goals
  • Write a WHY paragraph for each goal, include PAIN if not achieved
  • Find images associated with each goal to view daily

 [16:33] Rod’s insight around taking action on your goals

  • Identify your WHY and associated PAIN
  • Magnificent life on other side of comfort
  • Confidence comes from competence
  • Fear diminishes with action

[20:22] The value in truly deciding to change your life

  • Mindset is 80% of formula for success
  • Decision is critical
  • Tony Robbins’ Dickens process
  • Explore damage limiting belief caused
  • Stack 10X pain on top

[25:48] How to overcome discouragement (i.e.: lack of progress, losing a deal)

  • Get clear on what you want, why you want it
  • Revisit goals daily

[27:23] Rod’s advice around overcoming fears

  • Look at fear rationally, no basis in fact
  • Identify limiting belief, develop alternative
  • Eliminate self-imposed limitations

[32:30] The value of experiencing what you want

  • Harder to give up once you’ve had tactile experience

Connect with Rod Khlief

Rod’s Website

Rod’s Free Book

  • Text “Rod” to 41411

Multifamily Community on Facebook

Rod’s Podcast

Resources

Apartment Building Investing Episode 38

Tony Robbins: The Dickens Process

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

Review the Podcast on iTunes

Direct download: MB_088_-_Overcoming_Challenges_-_With_Rod_Khleif.mp3
Category:general -- posted at: 6:36pm EDT

It’s important for each of us to find our niche in the real estate investing space. Maybe you’re confident that commercial real estate is where you want to be, but multi-family just doesn’t feel like the right fit. There are other asset classes to consider, and one of the most recession-resistant is that of self-storage.

Hunter Thompson is the Managing Principal of Cash Flow Connections, a private equity group out of Los Angeles that connects passive real estate investors with opportunities in the commercial space, with a specific focus on mobile home parks and self-storage properties. Hunter has done 100-plus deals valued in excess of $350M.

Hunter got his start investing in stocks, but the lack of predictability in the market led him to focus on simpler investments with mitigated risk. After connecting with a network of like-minded individuals, he began investing in mortgage notes before branching out into other real estate asset classes. Today he shares what inspired him to invest in self-storage, explaining what makes the opportunity truly recession-proof. Hunter discusses self-storage value-add strategies, the benefits of self-storage as an investment, and how to find the best markets in the space. Listen in to understand what Hunter looks for in a sponsor, his approach to management, and his advice around next steps for aspiring self-storage investors.

Key Takeaways

[1:45] Hunter’s shift to real estate investing

  • Grandfather was successful businessman
  • Initial interest in stocks, too much volatility
  • European debt crisis inspired shift
  • Real estate more predictable, simple

[4:20] Hunter’s first real estate deal

  • Attended 3-5 networking events/week
  • Found small group of likeminded individuals
  • Invested in mortgage note

[5:43] How Hunter got into self-storage

  • By 2013, good deals hard to find in traditional asset classes
  • Data analysis inspired focus on recession-resistant assets
  • Self-storage used during times of economic change

[7:28] The benefits of investing in self-storage

  • Many ways to add value to property without taking on additional risk
  • Can add $1M of value with U-Haul, tenant insurance and merch
  • Sticky tenant base allows for 6% rental increase annually

[10:13] The best markets for self-storage investment

  • Identify undersupplied markets (i.e.: southeast US)
  • Utilize data from CoStarLoopNet or Yelp

[12:06] What Hunter looks for in terms of underwriting

  • Expense ratio of 40% (or even below)
  • Price per unit of $12-14K
  • Price per ft2 of $65-110
  • Climate-control as upsell

[13:26] Hunter’s approach to management

  • Onsite management important component of A-class property
  • Sponsor hires either entrepreneurial property manager or retired couple

[15:28] What Hunter looks for in a sponsor

  • Done $100M-worth of deals
  • 10 years of experience
  • Look at pro forma
  • Background check, references

[17:06] A case study of Hunter’s ideal investment

  • A-class property in Woodstock, GA
  • No value-add strategies in place
  • Previous owner just expanded by 222 climate-controlled units
  • Market 90% occupied, property 60% occupied
  • Adding ancillary income items = additional $4K/month

[19:44] Hunter’s take on trends in self-storage

  • On-demand services
  • Automation
  • Increase in demand as affluent baby boomers downsize

[21:36] Hunter’s advice around next steps for aspiring investors

  • Leverage experience of someone in game for 10+ years
  • Passive investing affords freedom to do what you love

[23:03] What Hunter is excited about

  • Construction boom
  • Unique opportunities to buy from sophisticated groups

Connect with Hunter Thompson

Cash Flow Connections

Cash Flow Connections Real Estate Podcast

Free eBook: Little Boxes, Big Profits

Resources

CoStar

LoopNet

Invest with Michael

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

Review the Podcast on iTunes

Direct download: MB_087_-_Self_Storage_-_With_Hunter_Thompson.mp3
Category:Commercial Real Estate -- posted at: 1:44pm EDT

‘At the end, you’re trying to find your highest and best use. How can you effectively create value based on your limited time?’

Perhaps you’re interested in getting into multifamily, but syndication is not for you. If your strengths lie in networking and raising money, you can get into apartment building investing as a general partner who specializes in soliciting capital.

Based in Hawaii, Lane Kawaoka still works his day job as an engineer, but he is quickly growing passive income streams via multi-family investing. After graduating from college with a degree in engineering, he got a job in construction management that required a lot of travel. In 2009, Lane bought a primary residence in Seattle—but he was never there. He decided to rent out his A-class property, and the cashflow generated from that enterprise inspired him to purchase more.

From there, Lane expanded his single-family portfolio, eventually discovering turnkey rentals. Today he is pursuing multi-family, recently landing his first 190-unit deal. But Lane is working deals from a different angle, coming in as the general partner who specializes in raising capital. On this episode, he shares his unique multi-family strategy, explaining how his Simple Passive Cashflow blog and podcast position him as a thought-leader in the space and afford the opportunity to network. Listen in to learn how Lane is compensated as the money-raiser, and hear his advice for aspiring entrepreneurs about building a platform that establishes your credibility as a multi-family investor!

Key Takeaways

[2:30] How Lane got into real estate

  • Engineer in construction management
  • Rarely at primary residence, traveling for work
  • Decided to rent, then purchase more
  • Stumbled on turnkey rentals
  • Working to build passive income streams

[6:11] Why Lane made the shift to multifamily

  • Tired of ‘managing the managers’
  • Realized single-family not scalable

[7:33] Why Lane was slow to get started in multi-family

  • No substantial net worth, experience
  • Thought had to be lead
  • Finally paid mentor to help

[8:33] The four parts necessary to do a multi-family deal

  • Net worth
  • Raising money
  • Experience
  • Finding deal

[9:24] How Lane leverages his blog and podcast

  • Tired of answering same questions about single-family
  • Started blog/podcast to address those questions
  • Good avenue for building relationships with like-minded people
  • Platform adds to credibility

[10:20] Lane’s approach to finding deals

  • Slow start (18 months)
  • Contact junior associates on brokerage websites

[11:58] Lane’s first multi-family deal

  • Came together in last six months
  • 190-unit in Texas
  • Came in as passive investor

[13:36] Lane’s multi-family strategy

  • Not interested in being syndicator
  • Multi-family game so big, specialization is necessary
  • Talent lies in raising money

[15:09] How Lane is compensated as the money-raiser

  • Receives promo raise rate
  • Get in as general partner (passive income stream)

[15:55] Lane’s strength in accessing capital

  • High net-worth network
  • Would rather spend time on podcast than analyzing deals

[17:36] Lane’s multi-family strategy moving forward

  • Build syndication business, portfolio
  • Get people out of ‘Wall Street roller coaster’
  • Raise capital, invest alongside

[19:37] Lane’s advice for aspiring entrepreneurs

  • Build track record
  • Create platform as thought-leader (video, audio, blog, meetups)
  • Find your strengths and double down

Connect with Lane Kawaoka

Simple Passive Cashflow

Email lane@simplepassivecashflow.com

Resources

Bigger Pockets

LoopNet

Invest with Michael

Podcast Show Notes

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

  • Download
  • Text “secretbook” to 44222

Review the Podcast on iTunes

 


So you want to get into multi-family investing, but you don’t have the money or the track record. Maybe you think that baby steps is the way to go, learning the game through single-family rentals or managing a small complex on your own. But if you have the right team, you don’t need to have $5M in the bank or 15 years of property management experience. You can serve as the quarterback and focus your energy on putting together deals, while your mortgage broker, property management company, and general contractor execute the playbook.

Devin Elder was born and raised in San Antonio, Texas. After graduating from UT-San Antonio with a degree in business, he went the corporate route, working in sales and operations for several area companies. But with each promotion, Devin lost a little more time and a little more autonomy. Then he got fired. In that moment, Devin vowed to find an alternative. At about the same time, Devin bought, renovated and refinanced his first single-family rental. Initially skeptical of real estate as a viable investment, he soon realized that the cashflow from rental properties could be his way out.

Two years and 20 doors later, Devin quit his last corporate job and became a full-time investor. Since then, he has shifted his focus to multi-family, working his way from a six-unit that he managed himself to a 75-unit to a 192-unit. Today Devin shares how a desire to scale his real estate business inspired the shift from single- to multi-family and why he takes pride in having a positive impact on the community. He explains the initial lack of confidence that held him back from pursuing multi-family and how he overcame that with the right peer group and a ‘someday is now’ philosophy. Listen in to understand why Devin would pursue entrepreneurship sooner if he could do it all over again, and hear his advice around ‘borrowing credibility’ to jump-start your multi-family business!

Key Takeaways

 [2:33] What inspired Devin to leave the corporate world for real estate

  • Climbing corporate ladder, lost time/autonomy
  • Giving his all, got fired
  • Vowed to find alternative
  • Single-family investment proved viable

[5:00] Devin’s initial strategy

  • Acquire enough cashflow to cover bills
  • Put team together, several single-family rentals
  • 20 doors in two years
  • Moved to tears on last day of work

[7:59] Devin’s shift from single- to multi-family

  • Wanted to scale business (5X cashflow)
  • Realized multi-family was more feasible
  • Banks willing to lend (established business model)

 [9:37] Devin’s multi-family starting point

  • C-area six-unit bought, managed himself
  • Wasn’t ready to take other people’s money
  • Friends from local mentor group encouraged bigger deals

[12:17] Devin’s second multi-family deal

  • 75-unit, deep value-add
  • Unsafe building, occupancy low
  • Capital raise with 11 investors
  • $1.2M renovation

[15:46] Devin’s take on working your way up in multi-family

  • Jump into 80-plus units
  • 5-80 units is ‘no man’s land’
  • Larger project allows for staffing

[16:59] Devin’s advice to his younger self

  • Multi-family is way to go
  • Hoard your money to get first deal done
  • Second will follow in quick succession

[18:06] Devin’s current multi-family deal

  • 192-unit in nicer area
  • 8-10% cash-on-cash return
  • Equity multiple of two over five years

[19:27] Devin’s advice to aspiring real estate investors

  • Employ ‘borrowed credibility’
  • Build team with experience, track record
  • Act as quarterback, specialize in putting deal together

[22:47] Devin’s failures

  • Lost own money on flip house, improved systems
  • Counts not pursuing entrepreneurship sooner as failure

[24:00] How Devin overcame a lack of confidence

  • ‘Someday is now’
  • Quitting job as mental hurdle

[24:52] Devin’s AHA moment

  • Desire to create life he enjoys every day
  • Not working toward ‘someday’

[25:33] What Devin is excited about

  • Making positive impact on community through multi-family
  • Rewarding to give investors good return
  • Rehab of property impacts neighborhood

Connect with Devin Elder

DJE Texas Management Group

Resources

Partner with Michael

Invest with Michael

Podcast Show Notes

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

Review the Podcast on iTunes


“I had this moment where I realized, ‘No, I’m not going to be the CEO of somebody else’s dreams. I’m going to be the CEO of my own dreams.’ I declared that day that I was never going to be an employee again.”

Tamar Mar is an adventurer at heart. She spent 20 years in the startup and small business arena, working as COO for prominent companies in the FinTech and real estate brokerage space. After making that decision to be the CEO of her own dreams, Tamar became what she calls a ‘business opportunist,’ building out her real estate portfolio and investing in small businesses like The Fitness Shop, a high-end specialty fitness equipment retailer.

Tamar invested in her first property at the age of 19, and she has owned rental properties for 15-plus years. From purchasing homes on auction to fix-and-flips to large-scale renovations projects, she has a keen eye for evaluating deals. This year, Tamar has shifted her focus to the acquisition of underperforming commercial and multi-family.  Today she shares how she made the shift from single- tomulti-family real estate, her approach to landing the first deal, and how she has become a ‘capital magnet.’  Listen in and get inspired to dream big and ‘take massive stinking action every day.’

Key Takeaways

[3:06] How Tamar got involved with real estate

[5:52] Tamar’s first real estate strategy

  • Got real estate license for access to properties
  • Purchased homes on auction, sight unseen

 [6:40] Tamar’s shift from single- to multi-family

  • Pursued single-family for three years
  • Learned about syndication
  • Could use operations expertise from startup world

[7:24] Why people are intimidated by multi-family

  • SEC regulations, working with attorneys
  • Raising capital

[8:04] What inspired Tamar’s shift to multi-family

  • Ambitious goal of $250K in annual passive net income
  • Couldn’t scale up quickly enough with single-family (100-250 doors)

[9:03] Tamar’s approach to landing her first multi-family deal

  • Studied multi-family forums on BiggerPockets, Michael’s Syndicated Deal Analyzer
  • Practiced analyzing deals on LoopNet
  • Began networking, building out team
  • Found great deal, put in offer
  • Landed 15-unit complex but didn’t have capital

[12:05] How Tamar raised the capital to fund her first multi-family deal

  • Needed $325K ($825K purchase price)
  • Additional capital for maintenance
  • Reach out to friends/family, networking groups
  • 6 investors (4 existing relationships, 2 new)

[14:51] How the project is performing so far

  • Secured property manager in Spokane
  • Rents above $300/door when purchased
  • Renovating all units, increasing price to market rate

[16:15] Tamar’s exit strategy

  • Ten-year hold with refinance in year two or three
  • Return 70-80% of investors’ original capital with refi (if not more)

[16:57] How the Law of the First Deal is impacting Tamar

  • Broker approached with off-market deal on 23-unit
  • Tamar walked away during due diligence
  • Broker contacted with 16-unit just hitting market
  • Landed 16-unit, walk-through tomorrow

[21:23] How Tamar’s multi-family success has shifted her perspective

  • Reevaluating goals, plans to secure 100 units by 2018 (with additional 50/year moving forward)
  • Went from three to 33 units in six months

[22:15] Tamar’s AHA moment

  • Christmas week of last year, in talks to become CEO of company back East
  • Declared independence, not willing to be ‘CEO of someone else’s dreams’

[24:06] Tamar’s advice to her younger self

  • Dream way bigger, earlier

[25:03] Tamar’s advice to aspiring multi-family investors

  • Pursue new knowledge
  • Follow in footsteps of people on path you want to take
  • ‘Take massive stinking action every day’

[26:22] What Tamar is excited about moving forward

Connect with Tamar Mar

Marota Group

Email tamar.mar@marotagroup.com

Investing for Life Podcast

Resources

The Millionaire Real Estate Investor by Gary Keller, Dave Jenks and Jay Papasan

BiggerPockets

Syndicated Deal Analyzer

LoopNet

Podcast Show Notes

Coaching with Michael

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

Review the Podcast on iTunes

Direct download: MB_084__Be_The_CEO_of_Your_Own_Dreams__with_Tamar_Mar.mp3
Category:Commercial Real Estate -- posted at: 11:15am EDT

What is your Stupid Human Trick?

We all have a unique ability that seems incredible to others. The trick is figuring out what it is that you are particularly good at and using those strengths to craft the processes and systems that capture wealth.

Cashflow Ninja M.C. Laubscher came to the US from South Africa in 2001 with a backpack and $500. He played competitive rugby and learned the real estate business via experience, buying his first property at the age of 21. M.C. befriended a wealthy multifamily investor who became his ‘accidental mentor,’ asking M.C. to serve in several different capacities from maintenance to leasing to property management to acquisitions. This education served him well, giving M.C. invaluable insight into the world of the wealthy and an understanding of all the moving parts of real estate. Now he is the President and Chief Wealth Strategist of Valhalla Wealth, a wealth management firm that leverages the Infinite Banking Concept to help clients co-author a plan for achieving financial security, independence, freedom and significance.

M.C. is also the host of Cashflow Ninja, a popular business and investing podcast that seeks to empower people to grow and protect their wealth in the new economy.  Today M.C. shares the best investment opportunities out there that combat wealth destroyers, why people struggle financially, and his advice for investors who want to break the mold. Listen and learn how to determine the wealth-building vehicle that’s right for you and the importance of investing in your own health, relationships and education. You are your own greatest asset, and M.C. is here to inspire you to reach your potential through multifamily investing!

Key Takeaways

 [2:48] How M.C. got involved in real estate

  • Read Rich Dad, Poor Dad
  • Bought first property at age 21
  • Befriended wealthy multifamily investor

[5:14] What surprised M.C. about ‘the world of the wealthy’

  • Complexity of determining overall plan

[6:36] M.C.’s take on the best investments out there

  • Combat wealth destroyers (taxes, inflations, commission/fees)
  • Real estate
  • Insurance products

 [10:05] Why people struggle financially

  • Outdated education model
  • Doesn’t empower people, teach skills to thrive
  • Lack of financial education
  • Outsource wealth-building
  • Conventional model set up to fail
  • Current environment (government debt, bankruptcy)

[14:08] M.C.’s advice to people who want to break the mold

  1. Be crystal clear about what you want (economic independence number)
  2. Determine why it matters
  3. Decide who you need to become
  4. Create systems/processes to capture wealth
  5. Put wealth into something that provides cashflow
  6. ‘Rinse and repeat’

[19:45] The benefits of investing in insurance products

  • Safe, secure, growing and liquid
  • Ability to borrow 90% from policy, put into real estate investments
  • Taxes on seed, not harvest

[23:07] How to figure out which vehicle or process is best for you

  • Focus on one thing in beginning
  • Once hit number, look at diversifying

[26:26] M.C.’s lowest depth of misery

  • Sports background prepared to absorb enormous disappointment
  • Sports injury, failed business deal and relationships fell apart all at once
  • Learned due diligence

[28:56] M.C.’s aha moments

  • Invest in self as life-long learner
  • Continue to grow network

[31:22] What M.C. would tell his younger self

  • You are your #1 greatest asset
  • Second greatest asset is relationships
  • Certain skills will not go away (marketing, sales and customer service)
  • Business must solve problems, create outcomes

[34:30] M.C.’s perfect day

  • Work out, family time and personal development
  • Attack the day at 11am (calls, interviews and case designs)
  • Family time, reading in the evening

Connect with M.C. Laubscher

Cashflow Ninja

Valhalla Wealth

Collapsing Time Webinar

Banking Principles Presentation

Resources

Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

Becoming Your Own Banker: Unlock the Infinite Banking Concept by R. Nelson Nash

Coaching with Michael

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

Review the Podcast on iTunes


Wealth is code for freedom.

If you want to be a millionaire, it’s probably because you want control over your time. You want the autonomy to make your days your own and spend them with the people you love. Today’s guest chose real estate as his path to freedom, spending less than he earned and investing the excess in apartment buildings. Maybe you are interested in doing following a similar path, but something is holding you back… 

Paul Morris is the co-author of Wealth Can’t Wait, a New York Times bestseller that identifies the seven traps that keep people from building wealth and equips readers with a comprehensive set of skills to achieve financial freedom. An active and consistent investor, he has grown his real estate portfolio to more than 700 rental units and 150,000 square feet of retail commercial space, and Paul was named among the 200 Most Powerful People in Residential Real Estate in 2013 and 2014.

Prior to working full-time in real estate, Paul enjoyed a successful legal career, working as an associate at a major international law firm and as Senior Counsel with the US Department of Justice. He has a degree in economics, a master’s in management from Oxford, and a JD from Cornell Law School. Today Paul shares his early experience in real estate, investing in a duplex while he was still in school. He speaks to the kinds of investments he prefers, the pros and cons of working with a partner, and how to get started in real estate with little to no money. Listen in to understand the three rules for investing that have helped Paul avoid losing money, as well as the seven wealth traps that keep people ‘stuck on the sidelines.’ Find out what’s holding you back and get on the path to health, wealth and freedom!

Key Takeaways

 [1:55] How Paul got into real estate

  • Working class dad invested in real estate
  • Provided income without working
  • Bought duplex in 1990 (Ugly Duckling)
  • Always worked with partner, gives courage

[4:59] The pros and cons of having a partner

  • Paul recommends working without partner
  • Choose partners based on brainpower, integrity
  • Clarify deal points, exit strategy in writing

[8:11] The kinds of investments Paul favors

  • Prefers buy and hold strategy
  • Buy and flip too risky

 [11:03] Paul’s philosophy of wealth as code for freedom

  • Ask yourself why you want to build wealth
  • Money affords power to choose, create
  • Allows to pursue greater goals
  • Love, health and time

[15:57] The 7 Wealth Traps

  1. Staying in a comfortable job
  2. Avoiding risk
  3. Viewing wealth negatively
  4. Giving up (not staying the course)
  5. Holding on to toxic friendships, the Weak Social Circle
  6. Victimizing yourself
  7. Thinking you know it all

[26:40] How to start investing in real estate with little or no money

  • Buy a home, live with roommates to cover mortgage
  • Use other people’s money

[29:32] Paul’s 3 rules for investing to avoid losing money

  1. Buy where you know
  2. Buy value-add (worst house in great/gentrifying neighborhood)
  3. Buy cashflow

[33:12] What Paul is excited about

  • Providing great, safe units in LA neighborhoods ‘turning a corner’
  • Traveling with daughter, girlfriend
  • Becoming better table tennis player

[34:04] Paul’s perfect day

  • Freedom to dress casually, work from home/coffee shop
  • Finished in time to pick up daughter from school bus
  • Hot yoga class with girlfriend

Connect with Paul Morris

morrisx.com

Paul on LinkedIn

Resources

Wealth Can’t Wait: Avoid the 7 Wealth Traps, Implement the & Business Pillars, and Complete a Life Audit Today! By David Osborn and Paul Morris

The Millionaire Next Door: The Surprising Secrets of America’s Wealthy by Thomas J. Stanley and William D. Danko

“7 Ways You’re Hurting Your Chances at Building Wealth, According to 2 Self-Made Millionaires” in Business Insider

Interview with Lewis Howes and Grant Cardone

“7 Strategies That Will Help You Build More Wealth, According to 2 Self-Made Millionaires” in Business Insider

“Are You on Track to be Wealthy? Two Successful Entrepreneurs Share the Most Important Skill to Have” in Forbes

“5 Timely Investments You Should Consider This Summer” in Forbes

Coaching with Michael

Review the Podcast on iTunes

Direct download: MB_082__Wealth_Cant_Wait__With_Paul_Morris.mp3
Category:Commercial Real Estate -- posted at: 7:09pm EDT

There’s more than one way to skin a cat, and though we spend a lot of time on the podcast addressing aspiring syndicators, there are other routes to financial freedom via real estate investing. High net worth individuals who are interested in getting a little skin in the multifamily game should consider the benefits of passive investing. Regardless of approach, the end game of apartment building investing remains the same: Permanently replace your income and get out of the rat race for good!

Dr. Tom Black (also known as The Passive Income Physician) was working as a busy emergency doctor in a high-volume trauma center. Yes, he was making good money, but he was working insane hours and he rarely saw his family. Tom was financially secure, but far from financially free—and he was fed up with sacrificing his time for money. Already enamored by the cashflow potential of real estate, Tom purchased several single-family homes and even tried his hand at commercial real estate before stumbling into his first multifamily deal, a 305-unit in Arlington, two years ago.

Tom’s brother, Tim Black, enjoyed a 32-year career in entertainment, retiring as the COO of a large hospitality company in March of 2016 when the business was sold to private equity. Eventually, his brother convinced him that multifamily was the best means to making your money work for you, and together they started Napali Capital. The firm has grown quickly, and the Blacks currently have 1,000-plus units in assets under management. Today Tom and Tim explain why multifamily is the best choice for passive investors, how to assess the risk profile of a multifamily deal, and the characteristics to look for in a potential syndicator. Listen and learn the returns a passive investor can expect from multifamily, the skill set necessary to become a successful investor, and the staggering tax benefits afforded by the platform.

Key Takeaways

[2:41] What prompted Tom’s involvement in real estate

  • Poor student in HS, gained confidence in Navy
  • Top of class in medical school
  • Couldn’t sell house after finishing residency
  • Rented to incoming resident
  • Enamored with cashflow
  • Busy doctor in high-volume trauma center
  • Making good money, but sacrificing too much time
  • Bought land in east Texas for commercial development
  • Resigned from practice and moved to pursue real estate

[5:51] When Tom identified multifamily as a ‘way out’

  • Bought foreclosures in Houston during downturn
  • Single-family was hard work
  • Studying economies of scale
  • 16-unit commercial development offered buffer in budget
  • Multifamily could take him to next level

[7:23] Tom’s shift from single family to commercial real estate

  • Cashflow limited to specific markets, required travel
  • Single-family very competitive
  • Saw vacant land, wanted to be ‘master of own destiny’

 [8:19] Why Tom wanted out of full-time medicine

  • Concept of security vs. freedom
  • Medical practice not sustainable
  • Doctors in their 70’s still working

[9:25] Tom’s first multifamily deal

  • Moved to Dallas for medical directorship
  • Attended real estate investing lectures
  • Stumbled onto 305-unit off-the-market deal in Arlington

[10:29] The difference between commercial development and multifamily

  • Developing is rough, many working parts
  • Multifamily offers formula for success, mitigated risk
  • Evidence-based reasoning appealed to Tom as doctor

[13:31] Tom’s advice around quitting your day job

  • He continues to work in medicine one day/week
  • Don’t be in a hurry to quit until achieve cashflow

[14:34] How Tim came to work with his brother

  • Poor student, but excelled at leadership
  • 32-year career in hospitality/entertainment
  • Retired in March 2016 (COO of large hospitality company)
  • Started Napali Capital together, capitalizing on each other’s strengths
  • Firm has grown rapidly, responsibly
  • Education is foundation of their business

[16:54] Why multifamily is the best choice for passive investors

  • Money works for you (cashflow, appreciation, depreciation, amortization)
  • Lack of affordable housing, cultural trend to downsize
  • Multifamily is stable and tangible

[19:22] How to assess the risk profile of a multifamily deal

  • Depends on syndicator, underwriter
  • Napali Capital is very risk averse (2% raises year-over-year)
  • Tim & Tom don’t offer huge returns (9% cash-on-cash)

[20:41] The returns a passive investor can expect in multifamily

  • 9% cash-on-cash
  • 90-100% return in five years
  • Napali always exceeds projections
  • 130% in 24 months on 305-unit

[22:22] The skill set necessary for a passive investor

  • Ability to read P&L
  • Knowledge of underwriting
  • Understanding of costs (rent rates, insurance)
  • Consider a mentor

[23:58] The Black’s advice around choosing a syndicator

  • Look for trust, integrity
  • Communication is key
  • Transparency (share financials)
  • Invest alongside you

[25:54] How to pacify the passive investor’s fear around risk

  • Trust the track record, pedigree of the syndication team
  • Stock market presents much greater risk

[27:06] The staggering tax benefits of multifamily

  • Stock market, mutual funds require payment of capital gains tax
  • With depreciation, taxed income is either substantially less or zero

[30:10] Tom’s final tips for aspiring multifamily investors

  • Get off the sidelines
  • Dip your toe in the water (crowdfunding)
  • Get educated

[31:09] What the Blacks are excited about

  • Growth of firm
  • Dynamic of relationship

Connect with Tim & Tom Black

Napali Capital

Email Tim: tim@napalicap.com

Email Tom: thomas@napalicap.com

Resources

The Passive Income Physician Blog

The Passive Income Physician: Surviving a Career Crisis by Expanding Net Worth by Thomas Black MD

Invest with Michael

Financial Freedom Summit Wait List

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


Your chances of doing even a 60-unit multifamily deal on your own—with no track record—are very slim. Even with the capital and the knowledge, if you are lacking in the reputation department, brokers will have no confidence in your ability to close. Enter Nighthawk Equity, my partnership with Mark Kenney. You bring the deals, and Nighthawk does the rest.  

Mark has been investing in real estate since he graduated from Michigan State 23 years ago, partnering with his twin brother to buy and rehab a $36K duplex. He continued to pursue small deals and flips during his career as a CPA and consultant for KPMD. Eventually, he started his own IT company. The business thrived, but 80-hour weeks and extensive travel translated to suffering in his personal life. With his marriage in trouble, Mark made the decision to take a huge pay cut, hand off the big projects to someone else, and pursue real estate investing full-time.

With the support of his family, Mark spent nearly a year securing his first big multifamily deal, a 64-unit building in Dallas. Adhering to the ‘law of the first deal,’ his second and third deals followed right away. In four years, Mark has purchased 2,000 units and raised tens of millions in capital. Today, Mark shares the process of working with Nighthawk Equity to secure a deal, explaining how we came to join forces, the response to Nighthawk, and the right time to get Nighthawk involved in your deal. Listen in to understand the mission of Nighthawk Equity, and how the firm also supports passive investors looking for a solid ROI.

Key Takeaways

 [2:36] How Mark got started with real estate

  • Didn’t have much money growing up
  • Knew real estate was tangible
  • Bought $36K duplex right out of college (with brother)
  • Used money saved over years for down payment
  • Full rehab
  • Continued to buy, rehab small multifamily properties

[5:13] Mark’s decision to become a full-time real estate investor

  • Worked as CPA, then consultant for KPMD
  • Founded successful IT company
  • Working 80 hours/week, projects all over world
  • Personal life and health falling apart
  • Decided to quit four years ago
  • Took huge pay cut, turned projects over

[7:16] Mark’s first syndicated multifamily deal (64 units)

  • Took nearly a year to secure deal (build relationships, team)
  • Raised $1M with one general partner, 14 other investors

 [9:44] The deals that followed in rapid succession after the first

  • 208-unit within two months
  • 255-unit, 454-unit and 344-unit within short period after that
  • Found partner with track record, relationships in Atlanta
  • 800 units in Atlanta this year alone
  • Raising money easier as well ($2.8M, $6.2M, $4M)

[11:30] The importance of surrounding yourself with the right people

  • Mark’s dad talked him out of buying early on
  • Risk involved in anything you do
  • Listen to wrong people, never do deal

[12:46] Michael and Mark’s partnership

  • Joined forces to scale transactional side of business
  • Chances of doing deal on your own very slim
  • Leverage their track record, reputation as partners

[14:51] The response to Nighthawk Equity

  • Looking for deals as syndicators
  • ‘Floodgates opened’ after Episode 74
  • Deals in OKC, Dallas, Memphis and Houston
  • Nighthawk diminishes fear of raising capital

[17:47] The process of working with Mark and Michael

  • Do initial underwriting, receive feedback
  • Coach qualifies (realities of assumptions)
  • Patrick reviews deal
  • Strong likelihood deal will work before gets to Mark

[18:52] The right time to get Nighthawk involved

  • After deal analyzed, researched properly
  • After pre-negotiation (verbal agreement, numbers discussed)
  • Before LOI
  • Before contract signed

[20:44] The future of Nighthawk

  • Help new investors alter mindset (i.e.: 69- to 321-unit in five months)
  • Continue to pursue joint ventures with students
  • Carry on mission to help others gain financial freedom

[24:44] Mark’s pitch to passive investors re: multifamily

  • Meets basic need, never going away
  • Incredible ROI
  • Performed well during recession (.4% default rate)
  • Tax benefits (pay little/nothing due to depreciation)

Connect with Mark Kenney

Think Multifamily

Email: mark@thinkmultifamily.com

Nighthawk Equity 

Resources

Podcast Episode 74

Partner with Michael

Invest with Michael

Financial Freedom Summit Wait List

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

Review the Podcast on iTunes


One of the big real estate rookie mistakes is to turn into a Walmart shopper as you build your team. It is easy to see a coach, lawyer, or property manager as an expense and choose to go with someone less experienced—or even elect to do the job yourself. But today’s guest can attest to the fact that a quality team is an investment that can save you millions in the long run.

Damion Lupo is a serial entrepreneur with a ‘think big’ mentality. In the last 25 years, he’s founded more than 30 companies in a number of industries including insurance, precious metals, venture capital, financial consulting and real estate. Damion is also a black belt in three different disciplines and the architect of Yokido, his very own martial art.

Damion’s personal philosophy centers around self-responsibility and a conviction that candor, growth and a big vision provide the only path to freedom. His commitment to these values led to the creation of Total Control Financial, a FinTech that seeks to reinvent financial control and empower Main Street with the tools of financial transformation. Today Damion discusses his first multifamily deal, a 119-unit property in Memphis that resulted in a $2M loss, and the lessons he learned from the experience. He shares the transformational power of failure, the importance of building a team you can trust, and the extraordinary value of a mentor. Learn how Damion’s shift from consumer to contributor had a revolutionary impact on his life.

Key Takeaways

 [4:03] How Damion got into real estate

  • ‘Tripped’ into it
  • Read Rich Dad, Poor Dad
  • Attended seminar for additional resources
  • Attracted to big-time cashflow potential
  • Quit insurance to pursue real estate

[5:44] Damion’s first steps in real estate

  • Bought house with Visa card
  • Planned to sell on payments after remodel
  • Strategies in place to pursue more properties, but wasn’t taking action
  • Failure to return phone calls almost led to bankruptcy

[7:18] How Damion was able to avoid bankruptcy

  • Gained momentum by purchasing eight houses in month
  • Purchased another 50 houses over next year (AZ, AL)

 [7:58] How Damion got stretched too thin early in his real estate career

  • Despite success, decided to try something different
  • Started high-end rehabs all over country
  • No team in place to help
  • Lost track of projects
  • Not paying attention to numbers
  • Let ego take over (want more and more)

[9:35] The lessons Damion learned from his first multifamily deal (119-unit in Memphis)

  • If you can’t be there, send team member with ‘massive integrity’
  • Listen to the numbers, get out if necessary
  • Stress test your team before going all-in
  • Don’t delegate too much, too soon

[14:31] What Damion could have done differently on the Memphis deal

  • Choose experienced partner
  • Move to site or have partner on-site
  • Invest in an experienced team, especially project manager
  • Leverage experience of mentors (make new mistakes)

[19:50] The value of a coach/ mentor

  • Damion lost $5M over two years after firing coach
  • Powerful to have people ‘call you on your shit’
  • Don’t let ego get in the way of listening
  • Helps you be methodical (rather than emotional)
  • Offers perspective, intuition to pass on bad deals

[24:48] Damion’s advice around leading a team

  • Clarify expectations up front
  • Have team share back what was heard in own words

[25:52] How Damion reinvented himself after hitting rock bottom

  • Equated net worth with self-worth (identity tied to money)
  • Learned that impact must be driver, wealth as side effect
  • Spent two years making shift from consumer to contributor
  • Teaching (martial arts, financial literacy) allows him to give, be present
  • People with contributing mentality happier, more successful
  • Can’t think your way to your Om, must do

[32:45] How dark times set you up for success and fulfillment

  • Must experience trauma to learn you are not in control
  • Recognize difference between success and fulfillment
  • Damion finds fulfillment in seeing people get out of ‘financial bondage’

Connect with Damion Lupo

DamionLupo.com

Damion’s Books

Reinvented Life Workbook

Resources

Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich by Tim Ferriss

Financial Freedom Summit Wait List

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

Review the Podcast on iTunes


‘That’s just the way I’m built: Nothing’s going to stop me.’

Joseph Gozlan’s story defines the word GRIT. Once he decided that multi-family was the route he wanted to take, Joseph continued to drive through every challenge, getting creative and doing whatever it took to secure his first deal despite the roadblocks and frustrations. Three years later, he is the proud owner of two apartment buildings, and he has five properties in the pipeline. Joseph’s living expenses are covered, and he is considering a transition into full-time real estate in the very near future.

Joseph got his start in real estate back in 2005 when he and his new wife realized that their new five-bedroom home was too big for just the two of them, so they chose to stay in an apartment and rent the property. Two years later, they moved to the United States from Israel and recognized the opportunity provided by the market collapse. The Gozlans secured their real estate licenses and began actively hunting for deals, purchasing a duplex and several single-family homes.

In 2015, Joseph realized there was much more value in apartments than could be gained in scaling single-family homes, and he started extensive research into multi-family investment. Unfortunately, Joseph faced a number of hurdles along the way, and it took a full two years to secure his first 22-unit apartment complex. When many would-be multi-family investors would have given up, Joseph persevered, and today he shares his long road to successful apartment building investing with us. Listen in and get inspired as Joseph discusses why he chose real estate in the first place, the circumstances around his shift to multi-family, and how he has maintained his full-time job in IT while developing a lucrative real estate portfolio.

Key Takeaways

 [1:59] Joseph’s start in real estate

  • Read Rich Dad, Poor Dad in college
  • Got married, lived in small apartment
  • Purchased house, too big for couple
  • Chose to rent house, stay in apartment
  • Moved to US in 2007
  • Joseph and wife got real estate licenses
  • Actively hunted for deals after market collapse
  • Bought duplex in Plano, TX (paid $180K, invested $30K in renovations)
  • Purchased additional single-family homes until numbers changed in 2013

[4:34] Why Joseph chose real estate in the first place

  • Wants to write giant cardboard check for $1M to children’s hospital
  • Early retirement, comfortable living, won’t have to answer to boss
  • Tangible assets like real estate trump stock market
  • Realized could be wealth-building strategy, key to financial freedom

[6:26] Joseph’s definition of financial freedom

  • Do what you want
  • Work from anywhere
  • No worry re: bills
  • Kids won’t experience struggle (like he did)

 [7:22] The circumstances around Joseph’s shift to multi-family

  • Two and a half years ago, duplex had foundation issues
  • Big ticket damage to another property at same time
  • Spent $40K to fix, wiped out five years cashflow
  • Recognized advantages of multi-family (single location, risk spread across multiple units)
  • Began extensive research (books, podcasts, BiggerPockets)

[11:11] The long road to Joseph’s first deal

  • Reached out to brokers, no response
  • Decided to source deal himself, began marketing (postcards, letters, phone calls)
  • Built rapport with owner/custom-builder of 22-unit apartment
  • Owner agreed to seller financing
  • Refinanced duplex and another property to afford

[14:02] The results of Joseph’s first deal

  • 23 days from signed contract to keys
  • Brought in property management company
  • Added $600—$800K in value via operation efficiency
  • Spends one hour with management company/week to assure accountability

[15:58] How Joseph handled concurrently working full-time

  • Sacrifice necessary
  • Some sleepless nights
  • Spent weekends looking at property, took occasional days off
  • Difficult but doable

[16:53] How Joseph secured a second deal within six months

  • Brokers responsive now that ‘closer’
  • Lead through property management company on 102-unit in Lubbock, TX
  • Knew costs, rent and demographics (unfair advantage)
  • Tight underwriting, made win-win offer

[18:11] How Joseph financed his second deal

  • ‘Ignorance’ gave him the confidence to raise funds
  • Elected syndication to raise $1.4M
  • Had to adjust underwriting model
  • Learning curve around how to talk to investors
  • Learned to focus on benefits (no headache), returns, low risk
  • Did all himself in 45 stressful days
  • Once one investor signs, recommend friends

[22:31] How Joseph’s second deal is performing

  • Only three months in
  • Great so far, working on renovations
  • Compliments from competition, positive feedback from residents
  • Joseph’s living expenses now covered on paper
  • Anticipates feeling comfortable enough to quit job after second quarter

[24:33] How Joseph stuck with the multi-family plan despite his initial frustration

  • Went into contract on another property first
  • Realized much-deferred maintenance
  • Seller refused to negotiate
  • Had to back out since numbers didn’t work
  • Not in Joseph’s personality to give up

[26:30] The snowball effect of multi-family deals

  • Joseph already under contract on third deal for 28-unit
  • Only took three days to get LOI signed (motivated seller)
  • Five properties in pipeline now (off-market deals)

[28:17] Joseph’s plans for the future

  • Recently renewed real estate license
  • Sourcing deals himself (sent 1300 pieces of mail)
  • Continue to work acquisitions
  • Also transition to brokerage side
  • Enjoys ‘coaching’ property management company, contributing ideas to improve processes

[30:08] What Joseph would tell his younger self

  • Skip single-family, go straight to apartment buildings
  • Could have thousands of units by now

[30:51] Joseph’s advice for hesitant multi-family investors

  • Don’t go it alone
  • Partner or get mentor to establish realistic expectations
  • Offer value to mentor (i.e.: underwriting, boots on the ground)

Connect with Joseph Gozlan

EBG Acquisitions

Eureka Business Group on Twitter

Multifamily Investing for Financial Freedom on Facebook

Resources

Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

BiggerPockets

Michael’s Products

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

Review the Podcast on iTunes


Most of the time, careful planning is a good thing. It is smart to develop a strategy first, and then take action on your goals. But the one situation in which it might be better to just put the blinders on and jump in? Multi-family real estate investment.

Pili and Jason Yarusi have a background in running restaurants and bars as well as experience in the family construction business. So when they were starting a family of their own and wanted to get out of the grind, real estate investment seemed like the perfect fit. They started doing capital-intensive flips and had success with out-of-state duplexes, but soon realized that flipping was a job that would have to be repeated time and time again. If the Yarusis wanted to achieve cashflow, apartment building investing was the way to go.

After doing a lot of reading and reaching out to mentors with multi-family experience, Pili and Jason found a quality property management company in Kentucky, and made use of the firm’s expertise to find a deal that fit their criteria. The Yarusis sold investors on their background of success in other businesses, and raised the $800K necessary to close on a 94-unit property. Today they share how their willingness to jump in without a clearly defined strategy paid off in the end and how they overcame the mindset challenges around multi-family investing. Listen in for Pili and Jason’s advice about reaching out to mentors and learning as you go.

Key Takeaways

[1:39] The circumstances that motivated Pili and Jason to invest in real estate

  • Ran restaurants, bars
  • Family construction business ‘gratifying, but grueling’
  • Pili pregnant with first child

[4:25] Pili and Jason’s start in-house flipping

  • Capital-intensive flips
  • No strategy going in (let idea grow)
  • Also purchased two out-of-state duplexes on gut feeling
  • Gave footprint (right questions, team members and processes)

[7:40] Why Pili and Jason shifted to multi-family

  • Realization that one single-family vacancy = 100% vacancy
  • Five vacancies in building with 100 doors = 95% occupancy
  • Multi-family income means you can afford team (on-site manager, maintenance, etc.)
  • Experience with duplexes taught them to vet property management company

[10:49] How the Yarusis moved forward once the decision to do multi-family was made

  • Jason educated himself, sought mentors
  • Utilized resources like BiggerPockets
  • Looked for deals in favorable out-of-state markets

[12:50] The mindset challenges around multi-family

  • Numbers seem scary (large = hard)
  • Concerns about raising capital

[14:09] How to overcome mindset challenges

  • Surround yourself with team, mentors
  • Meet people at networking events, REIA meetings
  • Reach out to friends of friends, other investors
  • The more you talk, the more it seems doable

[16:28] The hurdle of raising capital

  • Challenging due to lack of experience
  • Sold people on background of success in other businesses

[18:24] How Pili and Jason chose the Kentucky market

  • Looking for population growth, job growth/diversity
  • Familiar with Kentucky (friends, sister there)
  • Found property management company to offer feedback
  • Discovered property that fit criteria

[21:58] The Yarusi’s outlook when it was time to sign the contract

  • ‘Game time’
  • Work toward closing
  • Remain conservative (ensure return for investors)

[23:36] How much capital Pili and Jason raised for their first multi-family deal

  • $800K
  • Verbal commitments prior to contract
  • Didn’t start due diligence period until written notice of records received (extra 30 days)
  • One investor pulled out 20 days before closing
  • Scrambled to fill in gap

[25:27] How the 94-unit property is performing

  • Very well, achieved rent increases
  • Modest increase for good tenants
  • Turnovers up to market price

[26:45] The lessons Pili and Jason learned in their first multi-family deal

  • Walk every unit on morning of closing
  • Talk to everyone (don’t leave out any high-level investors)

[28:34] What’s next for the Yarusis

  • 47- and 57-unit in Kentucky
  • Bigger CapEx than first property

[29:56] Pili and Jason’s advice for aspiring apartment building investors

  • If multi-family is your endgame, start now
  • Consider the advantages of multi-family
    • Easier to secure loan
    • Can afford team
    • Vacancies less debilitating

Connect with Pili and Jason Yarusi

The REI Foundation Podcast

Email Jason at jason@yarusiholdings.com

Email Pili at pili@yarusiholdings.com

Resources

BiggerPockets

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

Review the Podcast on iTunes


All roads lead to multi-family. It seems that no matter how you get your start in real estate, the vast majority of investors come to the same conclusion: For passive, everlasting cashflow, multi-family is the way to go.

Jack Bosch came to the United States from Germany in 1997 to finish his college degree. He worked in the corporate world for several years, but soon found that it did not afford the life he wanted. His visa was dependent upon keeping his job, yet the company that was struggling, so Jack was inspired to start a company of his own.

Attracted to real estate because of its cashflow potential, Jack got his start flipping land. Over the course of three years, he developed a system that allowed him to do 3,800-plus deals, and he achieved financial freedom in a short time. Jack eventually moved into the single-family space, developing a portfolio of rental properties, and he finally graduated to multi-family in the last year. Today he shares the specifics of his transition to multi-family, his experience raising money for the first time, and his advice for investors who dismiss apartment buildings as an advanced strategy. Listen as he explains why he would have liked to get into multi-family sooner, and how you can get started in the space with no prior experience.

Key Takeaways

[2:12] How Jack got involved in real estate

  • Constant travel for work
  • Only two weeks’ vacation
  • Not the life he wanted to live
  • Company struggling, many lost jobs
  • Visa dependent on employment
  • Desire to start own business
  • Real estate appealed because of cashflow

[4:00] Jack’s start in flipping land

  • Could sell land for seller financing
  • Generate long-lasting passive cashflow

[5:36] How Jack defines a transaction

  1. One-time cash deals (flip house, get paid once)
  2. Temporary cash (give loan, receive interest)
  3. Monthly payments (flip land for seller financing, receive down payment + monthly installments for six to eight years until paid off)
  4. Forever cash (passive, everlasting income via multi-family)

[8:47] Jack’s transition to multi-family

  • Began working real estate in 2002
  • As of 2009, still hadn’t touched rental properties (thought too complicated)
  • Discovered houses available for $50/ft²
  • Purchased several dozen, rehabbed and managed themselves
  • Made mistakes (bad tenants, spent too much on rehabs)
  • Eventually found good property managers
  • Learned to systematize
  • Still not hassle-free (deal with one property at a time)
  • Realized multi-family properties provide buffer

[12:52] Jack’s advice around the multi-family learning curve

  • Acquisition, sourcing, negotiation, analysis and management processes are different
  • Look for a partner-expert to learn from
  • Jack did first deal on 93-unit in Louisiana with experienced friend
  • Experience was ‘hands-on MBA in multi-family’
  • Now building own team, additional funding sources
  • Still works with partner on bigger projects
  • Looking to build out own portfolio as well

[18:10] Jack’s experience with raising money

  • First time on multi-family deal
  • Benefitted from having reputation in market
  • $1.4M raised in short time
  • Felt responsibility as steward for someone else’s money

[21:01] Jack’s conclusions about multi-family

  • At top of favorite investment methods list
  • Securing good property management company is key
  • Low risk, high reward (extremely safe investment)
  • 93-unit property has doubled in value
  • Recession-proof (extraordinarily low default rate)

[22:48] Why Jack would have liked to start multi-family sooner

  • Cashflow would have been multi-fold higher
  • Single-family experience did teach building, rehab
  • Could have gone right to multi-family with proper guidance
  • Employee mindset, thinking small held him back
  • Success with early investments helped grow thinking
  • Systems in place to make business scalable
  • Some aspects of multi-family are easier than single-family

[28:20] Jack’s advice for investors who dismiss multi-family as an advanced strategy

  • Shadow a coach/mentor
  • Mentor acts as ‘time compressor’
  • Help with mental hurdles, analyzing numbers

[30:26] What Jack is excited about

  • Cashflow affords family opportunity to travel (Trips planned to Europe, Asia, Germany, South America)
  • Business continues while they travel
  • Looking to secure 5,000 units in five years
  • Transform lives of investors (up to 16% yearly average returns)

Connect with Jack

Jack on Facebook

JackBosch.com

JackBosch.com/apartments

JackBosch.com/land

Mastermind for Business Owners

Resources

TheMichaelBlank.com

Michael’s Products

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

Direct download: MB_076__Multifamily__Forever_Cash_Flow__With_Jack_Bosch.mp3
Category:Commercial Real Estate -- posted at: 3:32pm EDT

Yes, crowdfunding is out of reach for the average newbie syndicator. But if you’ve got a great deal and a willingness to hustle, it is possible to partner with a larger real estate company and take advantage of the capital available through crowdfunding. Platforms like Realty Mogul are looking for sponsors with a track record, so if you don’t have one—find someone who does.

Jilliene Helman is the CEO of Realty Mogul, the premiere online marketplace for real estate investing. The platform employs cutting-edge technology to connect its network of 130,000 registered investors looking for passive investments in commercial real estate with established real estate companies looking to acquire and operate commercial properties.

Realty Mogul is a marriage of Jilliene’s affinities for financial services and technology. She founded the company in 2013 to take advantage of the opportunities around crowdfunding afforded by the JOBS Act. Today she discusses why Realty Mogul chose to focus on the commercial space, the types of investments the platform offers, and the Realty Mogul definition of a good deal. Learn about the evolution of the crowdfunding industry, and heed Jilliene’s advice about partnering for aspiring syndicators.

Key Takeaways

[2:33] How the crowdfunding industry has evolved

  • Started five years ago with passage of JOBS Act
  • Has become more and more mainstream
  • Began with donation-based sites (e.g.: Kickstarter, Indiegogo)
  • Evolved into investment-based crowdfunding (i.e.: commercial real estate)
  • Since 2013, Realty Mogul has raised $300M online
  • Will continue to grow, scale
  • Over $1B in invested capital through crowdfunding this year alone
  • Provides investors access to private transactions

[3:55] Why Realty Mogul chose to focus on the commercial space

  • Huge opportunity in single-family space early on (2013-2015)
  • Banks off-loading residential properties
  • Not easy to make money doing fix and flips
  • Chose to focus on existing properties, tenants and cashflow
  • Less risky than vacant residential property being renovated

[4:54] The types of investments Realty Mogul offers

  • Joint venture (common) equity investments
  • Paid last (riskiest part of capital stack)
  • Gets piece of appreciation
  • Preferred equity investments
  • Paid before joint venture equity
  • Receives flat, pre-negotiated rate (doesn’t get any of appreciation)
  • Mezzanine debt investments
  • Senior mortgage debt investments

[6:54] What Realty Mogul is looking for in a sponsor

  • Don’t do business with first-time sponsors
  • History, track record of success
  • Real estate company with experience in market, property type
  • Investors want to work with sophisticated real estate companies
  • Typically don’t work with solo operators
  • Looking for full-time sponsors with own company, employees
  • Serious and professional about execution in investing in real estate

 [8:34] Jilliene’s advice for aspiring syndicators

  • Do a transaction
  • Raise capital from friends, family
  • Add value, build a track record

[10:12] Jilliene’s guidance around partnering with a larger real estate company to employ crowdfunding

  • If have solid deal, no reason you can’t partner
  • Will have to pay real estate company
  • Won’t have control of transaction
  • Realty Mogul requires one sponsor to have final say

[11:47] What Realty Mogul defines as a good deal

  • Every deal is different
  • Focus on cashflowing real estate (existing tenants)
  • Majority of deals are Class B assets in secondary markets
  • Look for opportunity to value-add
  • 7-8% average cash-on-cash return to investors
  • 15% IRR net to investors

[14:13] The requirements for passive investors on Realty Mogul

  • Public, non-traded REIT open to all investors (diversified pool of commercial real estate investments)
  • Private transactions limited to accredited investors (income above $200,000 or net worth above $1M)

[15:28] The process of becoming a passive investor with Realty Mogul

  • Sign up for user account
  • Select transaction
  • Entire experience is digital
  • REIT is blended vehicle
  • Accredited investors pick and choose specific properties

[16:40] The benefits of working with Realty Mogul

  • Track record
  • Over $300M invested in commercial real estate
  • Real estate companies do multiple transactions (speaks to experience)
  • Network of 130,000 investors

[17:23] How Realty Mogul came to be

  • Jilliene worked in banking (wealth management)
  • Wealthiest clients were real estate investors
  • With JOBS Act, Jilliene saw opportunity
  • Blends her passions—financial services and technology
  • Mission to help people generate wealth via real estate investing

[18:22] Jilliene’s take on the future of crowdfunding

  • Will continue to grow
  • More and more mainstream
  • Investors more comfortable with doing transactions on internet
  • Billion-dollar industry

Connect with Jilliene

Realty Mogul

Resources

 Deal Desk

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


What gives a 27-year-old with no experience in apartment building investing the audacity to swing for the fence?

Patrick Duffy grew up in Southern California before heading east for college. After graduating from Harvard in 2013, he returned to SoCal to work as a commercial real estate banker and later for a hedge fund, buying non-performing mortgages. He grew up around real estate, his family owning a multi-family property since the 1950’s, and he had always intended to invest in apartments—as soon as he had the money to do so.

Before long, Patrick was unhappy at his job, so he started reaching out to investors he had lent to in order to get clarity on how to analyze deals. Despite his lack of experience on the principal side of real estate, Patrick started studying LoopNet and set the goal of securing 100 units in two years. Eventually, he discovered Michael’s Deal Desk resource, and used the Syndicated Deal Analyzer to get feedback on a 69-unit property in Memphis. The deal met Michael’s criteria, and the two forged a partnership.

Today Patrick explains the steps he took to research the Memphis market, how he made use of the act ‘as if’ approach to secure a letter of intent, and his best advice for working with investors. Listen in as he shares the mindset that helped him swing for the fence on a multi-family deal and how doing his first deal has changed the game for Patrick, as he aspires to reach 1,000 units in the next 12 months.  

Key Takeaways

[3:30] How Patrick landed on the partnering strategy to finance multi-family

  • Briefly considered flipping single-family
  • Preferred multi-family, but biggest block was capital
  • Looked at creative financing options
  • Partnering seemed like most feasible route
  • Goal to secure 100 units in two years

[6:04] How Patrick found the Memphis deal

  • Clarity re: how to analyze deals
  • Practiced via LoopNet (comparing markets, packages from brokers)
  • Underwriting to get feedback
  • Memphis market seemed ideal (cap rates, unit sizes, price)
  • Reached out to learn about Memphis market
  • Found 69-unit deal on LoopNet
  • Submitted to Syndicated Deal Analyzer
  • Positive feedback from forum
  • Called broker on New Year’s Eve

[9:23] Why Patrick continued to move forward

  • Nothing to lose
  • Deal met criteria for partnering via Deal Desk
  • Act ‘as if’ approach to secure LOI

[11:13] Michael’s partnership with Patrick

  • Impressed by Patrick’s thorough research
  • Surprised by return (Memphis not one of published geographies)
  • Got contract from seller, proposed changes
  • Built team as went (property manager, lawyer)
  • Patrick took initiative
  • Under contract with seller
  • Wire EMV
  • Collect due diligence docs
  • Financial due diligence process
  • Create investor package
  • Met in Memphis to look at property
  • Michael sent sample deal package to investors
  • Acquired financial commitments
  • Hired SEC attorney
  • Started appraisal process

[13:18] Patrick’s experience working with investors

  • Michael’s network eager for deals that fit criteria
  • Addressed questions about specifics of market
  • SEC attorney had drafted necessary documents
  • Used DocuSign to track eSignatures

[15:23] The closing process for the Memphis 69-unit deal

  • Loan approved, investors wired funds
  • Patrick received acquisition fee of $23,000
  • Also reimbursed for expenses incurred during due diligence

[16:25] The impact of doing your first deal

  • Only so much can be taught re: what to expect
  • Once learn to partner, can scale quickly
  • Feel more comfortable and taken more seriously
  • Brings down barriers
  • Patrick under contract on 196-unit deal two weeks later
  • Expects to hit 1,000 units in next 12 months

[19:50] Why size isn’t a factor for Patrick

  • It’s about process
  • Anything under 500 units is viable
  • Don’t worry about equity
  • Finding deal is the issue (not money)

[21:35] Patrick’s advice for aspiring multi-family investors

  • Take advantage of Deal Desk resources
  • Does require high level of commitment
  • Hard work is worth it

Connect with Patrick

Email: pduffy32@gmail.com

Resources

Deal Desk

Syndicated Deal Analyzer

Ultimate Apartment Investing Course

The Financial Freedom Summit Live

LoopNet

DocuSign

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


Landing your first multi-family deal is much like pushing over the first in a series of dominoes: The second and third deals fall in rapid succession. In most cases, it is possible to replace your income one to three years from the moment you decide to change your life.

Brad Tacia’s story adheres to this Law of the First Deal. He was an engineer by trade, working for an auto parts manufacturer in Detroit. Though he survived the recession, Brad knew that he needed a backup plan. He began his foray into real estate with single-family homes, using a portion of his 401(k) to facilitate the investment.

Brad reached a turning point when he realized just how much of his daughter’s life he was missing. To speed up the process of achieving financial freedom, Brad and his wife used the Dave Ramsey program to cut their expenses and pay off their house—which allowed them to fund their first multi-family deal with a home equity loan. Brad’s second and third deals followed quickly on the heels of the first, and in two years, he had replaced his income. Brad quit his W-2 job, and now he controls 160 apartment units total. Listen as he explains his experience with Dave Ramsey’s Financial Peace University, how he funded his first three multi-family deals, and his secrets to becoming financially free in just two years. He also shares his knowledge around syndicating deals as well as the details of how his life has changed, making every day feel like Saturday!

Key Takeaways

 [4:26] Brad’s motivation to try real estate

[6:36] What precipitated Brad’s shift to multi-family

  • Daughter asking, “Do you have to work tomorrow?”
  • Desire to spend more time with family
  • Realized could achieve financial freedom faster with multi-family

[7:16] How Brad funded his first multi-family deal

  • Used Dave Ramsey program to cut expenses
  • Paid off house
  • Funded 12-unit with home equity loan

[8:14] Brad’s experience with Financial Peace University

  • Listened to Dave Ramsey audio discs with wife
  • Employed common sense budgeting
  • Made lifestyle adjustments (less eating out, cash budget for groceries)
  • Paid off credit card debt, auto loans and house
  • Felt safe in case of another downturn

 [11:23] Brad’s next two multi-family deals

  • Second deal six months after first
  • Bought another 12-unit with partner (property manager)
  • Third deal (63-unit) four months later
  • Bought 50/50 with different partner (realtor)
  • Replaced income in under two years

[13:23] How Brad developed the confidence to do his first multi-family deal

  • Reading books
  • Training, networking
  • Honed skills in financial analysis

[14:01] Brad’s advice around funding multi-family deals

  • Look for cheapest method
  • Home equity loan only 3.3% interest
  • IRA (taxes, penalty for withdrawal)
  • Syndicating

[15:19] Brad’s experience syndicating deals

  • Awkward to ask for money at first
  • Not as difficult as imagined
  • Frame as offering opportunity for 15% average annual ROI

[16:41] Brad’s secrets to becoming financially free in two years

  • Get your expenses under control
  • Employ courses that teach step-by-step process
  • Income will snowball

[18:00] The significance of the first deal

  • Learn the language
  • Contacts, team in place (property manager, banker, inspectors, real estate brokers)
  • Understand mechanics of deal
  • Become addicted to cashflow
  • Want to grow, take pressure off day job

[19:27] How Brad found time to do real estate on the side while working a demanding job

  • Full-time engineering manager with 23 employees (50-60/hour weeks)
  • Looked for deals before work
  • Made phone calls during lunch hour
  • Saw apartment buildings after work, weekends

[20:20] How Brad’s life has changed

  • Building stronger relationships with family, friends
  • Working out, eating well
  • Getting enough sleep
  • Completing projects had put off
  • Bonding with coaching students (Ultimate Apartment Investing Coaching Program)
  • Quitting full-time job allows to think more strategically, design life to make impact

[22:30] Brad’s perfect day

  • Wake up without alarm
  • Work out
  • Family time
  • Coach students
  • Look for new deals
  • Take vacations at will
  • Every day feels like Saturday

[23:22] How Brad wants to be remembered

  • Family man
  • Mentor
  • Inspire people to take risks (it’s risky not to go for it)

[24:34] Brad’s best advice for aspiring multi-family investors

  • It’s more doable than you realize
  • Choose five-year retirement plan over 40-year retirement plan

Connect with Brad

Ultimate Apartment Investing Coaching Program

Apartment Investors of Michigan Facebook Group

Resources

Apartment Building Investing Session #55

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not by Robert T. Kiyosaki

The Millionaire Real Estate Investor by Gary Keller

Bigger Pockets

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

The Financial Freedom Summit Live

Review the Podcast on iTunes


What is stopping you from achieving financial freedom through apartment building investing? Is it because you don’t have single-family experience? Are you intimidated by the perceived complexity of the multi-family space? Or maybe you think you don’t have enough money to consider pursuing multi-family deals? Today’s guest has encountered and overcome all of these limiting beliefs, and today he reveals how to get out of your own way and get on the road to financial freedom.

Tyler Sheff is the founder of CashFlowGuys.com and the host of the Cash Flow Guys Podcast. He was making six figures as a merchant mariner when he and his wife took a hard look at their future. Tyler didn’t want to wait until he was 65 to enjoy life, so he took compensatory time and gave himself six months see if real estate investing would prove viable and provide the cashflow necessary to attain financial freedom.

In just 11 months, Tyler had replaced his income. At that point, he had invested in 26 units in Florida and Tennessee – using none of his own money. Now he leverages his 17 years of experience to demystify the real estate investing space, encouraging others to focus on cashflow and take massive action toward their goals. Today, Tyler shares his journey, explaining how he landed his first few multi-family deals, why single-family experience is unnecessary in the apartment building space, and how he employs relationship marketing to raise capital. Listen in as he unpacks each of the limiting beliefs that held him back and reveals how to overcome ‘analysis paralysis’ and move forward with your dreams of building passive income and escaping the rat race.

Key Takeaways

 [2:55] How Tyler got started in real estate

  • Desire to ‘get rich quick’
  • Made money as house flipper
  • Sold portfolio before market crash
  • Acquired huge tax bill
  • Went to work for government as merchant mariner
  • Climbed ranks to six-figure salary

[4:32] Why Tyler returned to real estate

  • Way to legally, ethically avoid taxation
  • Focus on cashflow this time (not appreciation)
  • Job on ship kept away from family
  • Not feasible to continue for 20 years (physical toll)
  • Wanted better quality of life, time on hands

[8:08] Tyler’s experience as a landlord

  • ‘Accidental landlord’ in late ‘90’s to maximize returns on sales of fix and flips
  • Got into multi-family in 2014 to scale quickly

[9:10] Tyler’s first multi-family deal

  • Pre-approved for VA mortgage
  • ‘For Rent’ sign on four-plex
  • Paid zero down, received check for $1700 at closing
  • Moved into one unit, rented other three
  • Rehabbed quickly
  • Cashflow right away
  • Converted one unit to vacation rental
  • Cashflow increased from $1,200 to $5,000/month

 [12:12] Tyler’s next two deals

  • Learned to raise capital (Secrets of Successful Syndication seminar, Sam Freshman book)
  • Built team, cut teeth on ten- and 12-plex in Memphis
  • Tennessee known for cashflow (not organic appreciation)
  • ‘Overimproved,’ didn’t see anticipated ROI
  • Learned to analyze needs of tenants
  • Brought to total of 26 units in 11 months
  • Capital raised through IRA lenders
  • Tyler able to quit government job

[17:22] The limiting beliefs that held Tyler back

  • Analysis paralysis (first deal so good, couldn’t stop comparing)
  • Fear of making mistakes was crippling

[19:22] Why single-family experience is unnecessary to enter the multi-family space

  • ‘Almost better off with no experience’
  • Tyler feels single-family background made him too conservative

[21:49] How Tyler achieved multi-family deals without using any of his own money

  • Partnered with experienced property management company
  • Enlisted exceptional legal and accounting teams
  • Experience of team led to capital (didn’t matter that Tyler was inexperienced)

[23:05] How Tyler leveraged ‘relationship marketing’ to raise capital

  • Started podcast, Cashflow 101 workshops
  • Positioning self as expert led to referrals
  • Matched investors with experienced syndicators
  • Learned from those syndicators (willing to help)

[24:44] Why the complexity of multi-family is a limiting belief

  • Same as single-family, just larger scale (only one roof)
  • Tyler contends apartments are easier to work with
  • Many moving parts, must be able to manage others effectively

[25:50] The importance of Tyler’s first deal

  • Critical in realizing he could do this
  • Second and third deals built confidence as he encountered and overcame problems

[26:56] How Tyler’s life has changed

  • Doesn’t have to ‘hunt’ for next check as buy and hold investor
  • Receives mailbox money each month
  • Continues to attract capital, source opportunities
  • Time available to educate others with free content
  • Freedom to spend time with family

[29:51] Tyler’s perfect day

  • Watch sunrise in kayak
  • Fish all morning
  • Work on podcast, instructional video in afternoon
  • Help others attain same kind of financial freedom

[30:27] Tyler’s advice for aspiring multi-family investors

  • What do you have to lose?
  • Only tangible thing is time
  • Educate yourself and take action

[31:02] How Tyler wants to be remembered

  • As change-maker who ‘made difficult stuff simple’

Connect with Tyler

Cash Flow Guys

Tyler’s YouTube Channel

Resources

Secrets of Successful Syndication

Principles of Real Estate Syndication by Samuel K. Freshman

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


More money, more problems.

One of the major pain points for high net worth individuals involves taxes. Today’s guest was hit hard with a $497K bill in 2010, and that’s when he decided stop giving his money away to the IRS and start investing in multi-family properties!

David Zook is a wildly successful entrepreneur and experienced investor in the multi-family space who has syndicated over $50M worth of real estate in his career. His portfolio includes 3,000 apartment units in several states as well as Ambergris Caye, the largest resort in Belize. David has entered the ATM market as well, capitalizing on another investment that offers tax-advantage cashflow.

David is also a sought-after speaker and published author who has presented at venues such as the International Business Conference, The Jason Hartman Real Estate Mastermind, and The Cash Flow Wealth Summit. He credits his success to working with world-class teams, and today he discusses why it’s patriotic to take advantage of available tax breaks, the AHA moment that initiated his transition from passive investor to real estate syndicator, and how multi-family investing has evolved over time. Whether you’re a high net worth individual looking to reduce your tab with the IRS or a syndicator looking to raise money, this episode is for you. Listen in as David shares how he leverages paper loss and cost segregation to reduce his tax bill from $475K to nearly zero.

Key Takeaways

[5:43] Why it’s patriotic to take advantage of tax breaks

  • Incentives encourage certain activities (e.g.: oil exploration)
  • Government rewards for engagement

[7:27] The tax benefits associated with multi-family investing

  • Without creativity, can write off in 27½ years
  • Take ‘paper loss’ (allows to claim 3.6% annual loss)
  • Cost segregation study accelerates depreciation
  • Reinvest capital would have given to government

[10:49] How to exercise cost segregation

  • Licensed professional evaluates property
  • Report breaks down depreciation of component parts (i.e.: washer/dryer, pavement, plumbing)
  • Write off 70% of physical asset in five to seven years

[13:07] David’s advice around choosing syndicator (as a passive investor)

  • Find competent people with track record of success
  • Watch syndicator closely in early stages
  • Start small

 [15:08] How David transitioned from passive investor to syndicator

  • Came into market with cash, partner brought opportunities
  • Ran out of cash, invited family to invest
  • Finally had to slow down as ran out of cash
  • AHA moment on board of local startup bank, discussing .5% interest on CD
  • Realized could offer others double-digit returns via multi-family

[18:02] David’s approach to passive investing

  • Not involved in daily headaches
  • Must trust, believe in partners
  • ‘Team is more important than asset’

[20:24] How David raised money for his first deals as a syndicator

  • Psychological challenge (reputation in business)
  • Lived in Amish country, visited successful farmers
  • Listened to stories, identified pain points
  • Shared own successes
  • Raised $850K
  • Now can send email, get funding in two hours

[24:51] How David structures a deal

  • 5-10% range of cash-on-cash return
  • Investors concerned with consistent quarterly cashflow
  • Keep it simple

[26:28] How multi-family investing has evolved

  • Fewer deals today, must hustle
  • David’s team no longer aggressively chasing deals
  • Good broker, reputation for closing can procure 5-10% discount

[29:52] David’s ATM investing opportunity

  • Started as passive investor in 2012
  • Became partner last year, raised $9M in seven months
  • Introduces investors to exclusive asset class
  • Fits philosophy of investing for tax-advantage cashflow

Connect with David

The Real Asset Investor

Email info@therealassetinvestor.com

Email atm@therealassetinvestor.com

Resources

Email infor@therealassetinvestor.com

  • 8 Real Life Lessons for Syndicators and Their Investors
  • K-1 Sample (How Depreciation Works)

Robert Kiyosaki Books

Review the Podcast on iTunes

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


Real estate is no longer a local game, and smart apartment building investors have properties all over the country. The tricky part is finding a way to consolidate the data so that you can manage and analyze your portfolio all in one place. Is it possible to streamline the important property management processes when your investments are operated by different property managers using different software in different states? Today’s guest says, ‘Yes, you can,’ as she reveals how to remotely self-manage your real estate portfolio.

Dana Dunford is a real estate management specialist, licensed agent, and technology guru out of San Francisco. After earning her MBA from Harvard Business School in 2015, Dana co-founded Hemlane, a technology-enabled property management solution designed to support real estate investors in the remote management of their rentals. As CEO of the company, Dana understands that the best investments may not be in your backyard, and she is on a mission to provide investors with a single platform that consolidates and manages properties using intelligent software, virtual maintenance coordinators and local support.

Dana’s impressive resume includes positions at Apple, where she was a part of the worldwide financial planning and analysis team, and tech startup Nest, which was acquired by Google for $3.2 billion in 2014. Today she shares her expertise with the Apartment Building Investing audience, discussing the role of a property manager and the pros and cons of self-management. She covers the metrics you should be tracking as an owner, the benefits of property management software, and the processes that should be centralized across your portfolio. If you have between two and fifty properties, this is a must-listen interview that uncovers the tools available to help you remotely manage your investments.

Key Takeaways

 [3:25] The costliest expense in the property management space

  • Bad tenants
  • Turnover costs
  • Eviction expenses
  • Vacancy during inopportune months

[4:39] How to avoid the expenses associated with turnover

  • Advertise early and often (good tenants look 30 days out)
  • Advertise on as many sites as possible
  • Respond quickly, schedule showings asap
  • Screen thoroughly via comprehensive background/credit checks on every applicant (not just primary)

[6:28] The pros and cons of self-management vs. hiring a property manager

  • Makes financial sense to hire property manager for class C and D properties
  • Consider self-management in case of class A properties
  • Good idea to have licensed professional you trust ‘on the ground’
  • Maintain a sense of control by having access to financials, business records

[8:23] The role of a property manager

  • First to blame, last to get credit
  • Must be jack of all trades (finance/accounting, maintenance/repair, salesperson)

[10:17] Dana’s guidance around making property managers ‘offensive players’

  • Open communication, transparency in decision-making
  • Establish owner’s criteria for approving tenants
  • Collaborative partner when problems arise

[11:41] Dana’s advice about interacting with your property manager

  • Frequently in beginning to establish expectations, any time issues arise
  • Weekly call if oversee more than 200 units
  • Email weekly summary (# of tenant applications, leads)

[13:18] The benefits of property management software

  • Provides owner with real-time insight
  • Long-term savings offset $30 monthly investment

[14:28] The metrics owners should be tracking

  • Income statement is crucial (profit/loss, expenses, ROI)
  • Should be able to answer general questions about portfolio
  • Reasons for vacancies
  • Tenant risk mitigation (Following policies? Inspection reports?)
  • Financial risk (Autopay? Late payments? Late fees?)
  • May shift based on need (maintenance, marketing)

[16:17] The processes an owner should prioritize

  • Tenant selection
  • Legal contracts
  • Maintenance management

[17:39] How to incentivize tenants to pay on time

  • Daily late fees
  • Require payment of late fees before rent
  • Report late payments to credit bureau
  • Check state/county laws

[19:34] The processes Dana recommends centralizing across your portfolio

  • Marketing
  • Application
  • Financials, bookkeeping
  • Maintenance tracking

[21:15] How to consolidate your records

  • Newer software allows for integration (email support team with questions)
  • Export all data to single platform (e.g.: QuickBooksSmartMove, Excel)
  • Enlist help of VA only after processes in place

[24:45] The free tools Dana recommends for managing your portfolio

  • Trello (project management)
  • Slack (team communication)
  • Google Sheets
  • Dedicated email, phone number and business bank account

[25:59] The fundamentals of Hemlane software

  • ‘Best investments not in backyard’
  • Add any property to platform
  • Consolidates data for entire portfolio
  • Streamlines property marketing, applicant screening, lease tracking, rent/payments and maintenance

Connect with Dana

Hemlane

Hemlane on Twitter

Hemlane on Facebook

Email: dana@hemlane.com

Phone 385-355-4361

Resources

QuickBooks

smart move

Upwork

Trello

Slack

Google Sheets

Review the Podcast on iTunes

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


‘When others are fearful, be greedy. When others are greedy, be fearful.’ Today’s guest took Warren Buffet’s advice to heart, moving past her fear and reaching out to investors at the top of their game to ask for guidance as she shifted from single-family fix and flips to 300-plus unit multi-family properties. Her bigger-is-better philosophy has led to a love of investing in sizable unloved properties and performing a full-gut rehab to revitalize the property – and the community.

Kira Golden is the CEO of Direct Source Wealth, a real estate development company out of Denver that does direct deals and serves as a platform for new and experienced investors. By the time she was 18, Kira had holdings in both the real estate and stock market. After graduating Magna Cum Laude from George Washington University with a master’s in public administration, Kira worked as a financial advisor at Edward Jones until she was in a position to live off her investment income. She currently owns properties in Washington, Colorado, Arizona, Illinois, Ohio, Puerto Rico and France.

Kira is on a mission to bring high-quality deals to Main Street, providing clients with the financial freedom she has earned through investment in real estate. Today she shares how she financed her first deals, what prompted her shift from single- to multi-family properties, and why she reaches out to big name investors at the top of their game. Listen in to understand how to choose the right equity partners and why Kira recommends investing in apartments – the sooner the better!

 Key Takeaways

[2:25] How Kira got her start in real estate investing

  • Watched Robert Kiyosaki infomercials as ‘12-year-old insomniac’
  • Experienced windfall/freak-out cycle as daughter of inventor
  • Desire for consistent cashflow led to buying houses at 18
  • Bought five houses in three years

[5:13] How Kira financed her first deals

  • Invested $3K savings in stock market, grew to $10K
  • Used $10K to finance first house
  • Put $1K deposit on condo, then sold option to homebuyer (value had increased during construction)
  • Used profits to finance second house

[9:14] Kira’s minimalist philosophy

  • Continued to save money, work full-time during college
  • Conscious decision to ‘live like college kid’ until age 30
  • Passive cashflow exceeded expenses by 22 ($2K/month)

[10:56] Kira’s shift from single- to multi-family investments

  • Goals grew from $1M to $100M
  • Weary of fix and flips, borrowing hard money at 18%
  • Got into private lending
  • Time became more valuable than money
  • Feedback from lenders indicated that $1M loan for multi-family was easier to secure than $100K loan for single-family home

[15:07] Kira’s intent behind reaching out to potential partners

[16:56] Kira’s first 30-unit multi-family deal

  • Continues to take 20% of time three years later
  • Bank deal, bought distressed asset
  • Bought $5.4M bank note for $1M
  • Invested $2.5M to complete construction
  • Used investor capital, joint venture with equity partner

[19:19] How Kira attracts investors

  • Shares her excitement for deals
  • Distinguish between fear and intuition
  • Go where you’re afraid, reach out to big names
  • Founder, CEO of fifth largest mortgage bank in US
  • Large real estate investors at top of game

[23:12] What Kira learned from reaching out to sought-after investors

  • People you’re hero-worshipping are just people
  • Deep respect for what they have accomplished
  • Emulate skills that made them successful

[27:34] The importance of alignment in selecting an equity partner

  • Had to buy out partner on 30-unit after legal battle
  • Long-term buy and hold vs. high-velocity fix and flip will end in conflict

[30:47] How Kira would approach raising money for 30-unit deal without equity partner

  • Not beyond door-knocking (pushing own boundaries to raise more capital)
  • Approach bank to carry back the debt
  • Raise construction capital after closing ($250K/month)

[31:56] Kira’s 315-unit full gut rehab

  • Mentor offered pocket deal, he functioned as silent partner
  • Vacant, drug-/crime-infested area of Dayton, OH
  • Turned around, named top-ten complex in city
  • No equity partner, built engine to find investors (first generation made good)

[34:16] Why Kira wishes she had done multi-family sooner

  • Fix and flip experience was valuable (can’t be snowed by property management companies, contractors)
  • Two years would have been long enough
  • Multi-family is a better vehicle
  • Had to build confidence while maintaining roots

[37:21] Kira’s advice for aspiring real estate investors

  • Determine whether you are a deal junkie or just want to retire early
  • 10% who are deal junkies should align with experienced partner to short-cycle learning process

[39:15] What’s next for Kira and Direct Source Wealth

  • Three days meditating in Sedona
  • $100M fund to bring high-quality deals to Main Street

Connect with Kira

Direct Source Wealth

Connect on LinkedIn

Facebook

Resources

Partner with Michael

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


The vast majority of women perform a number of unpaid jobs every day, from childcare to housekeeping to food preparation. There is simply no time to pick up another job! But today’s guest argues that there is a way for women to generate substantial income that doesn’t require a lot of time and energy – apartment building investing.

Whitney Nicely believes that every woman should control her own destiny by investing in real estate as soon and as much as possible. Born into a family of entrepreneurs, Whitney was inspired to invest in real estate as a creative outlet that would allow her the freedom to be her own boss. She flipped her first house in 2009, and has since grown her portfolio to include 17 residential houses, 19 apartment units and seven chunks of vacant land across east Tennessee.  

Whitney’s philosophy is to take action first and figure it out as she goes. Her bold, ‘throw spaghetti at the wall’ strategy has proven successful, and now she teaches women how to invest in real estate with no money, no credit and no bank necessary. Listen in as she shares why she prefers apartments to single family homes, how she landed and financed her multi-family properties, and her advice around building a reputation as a local real estate authority. Learn why women need to start building a portfolio – today!

Key Takeaways

[2:27] How Whitney got her start in real estate

  • Mom is real estate investor (mailbox money)
  • Went in with no plan
  • Bought land for $1,500
  • Rents driveway and land for $750/month

[5:38] Whitney’s experience with single family homes

  • Bought two houses to rent
  • Realized would take 115 years to get money back
  • Discovered lease option (no money, no credit)

[6:38] Why Whitney quit the family business to do real estate

  • ‘Too much family, not enough fun’
  • Family of entrepreneurs
  • Sought creative outlet of her own

[7:29] The advantages of apartments (vs. single family homes)

  • More money with less time
  • Property manager to deal with problems
  • One roof, one tax bill
  • If one set of renters can’t pay, mortgage still covered

[12:30] How Whitney landed her three multi-family units

  • Property in country near industrial park
  • Previous owner lost through foreclosure
  • Local bank owned, managed by local realtor
  • Listed in small, local MLS (big players unaware)
  • Whitney in contact with agent, lead when price dropped
  • Used HELOC from house paid off to make offer ($25K for 5-unit, $35K for 11-unit)

[15:58] The cashflow on Whitney’s current multi-family properties

  • 19 units total
  • Triplex units bring in $550/month for each, mortgage $60 ($900 profit)
  • Five-units rent for $500/month, mortgage $800
  • 11-unit brings in $4,000/month, mortgage $1,100

[16:52] The other expenses associated with owning apartments

  • Real estate taxes, insurance
  • ‘Bug guy’
  • Property manager
  • Yard maintenance

[17:51] What’s next for Whitney

  • Mobile home park
  • Old building to rent as think tank/co-op office space

[19:04] Whitney’s early real estate misstep

  • Purchased house she hadn’t seen for $15,000
  • Fleas, squishy floors, dubious neighbors
  • Could not rent
  • Sold at auction for $11,000

[21:50] Whitney’s philosophy around taking action

  • Once you buy, three options (sell, rent, do something creative)
  • Play ‘what if’ too long, someone else will take your deal
  • Not bothered by not knowing what’s next

[24:27] How Whitney chooses people to do deals with

  • Lease option not for everyone
  • Focus on people tired of being landlord or making payment on empty house
  • Adopt take-it-or-leave-it attitude

[25:45] What sets Whitney apart from other investors

  • Talks to five to ten sellers per day
  • No fear, just put it out there
  • Finds off-market deals via personal Facebook page
  • Provides HGTV-style edutainment on social media
  • Local authority (crooked ‘I buy houses’ button)

[28:14] Why Whitney believes all women need a real estate portfolio

  • Allows to control own destiny
  • Statistically live longer, may have tendency to spend more money
  • Already do unpaid work at home, no time to pick up extra job
  • Extra $10,000 provided by real estate can make or break marriage, retirement

[30:03] How Whitney’s family reacted to her real estate investments

  • Husband, family not always on board
  • Thought she was wasting time, money
  • Started to take seriously after first $60,000

[32:34] Whitney’s advice for aspiring apartment building investors

  • Take action, figure out as you go
  • Don’t sign your name on $100,000 loan if not comfortable
  • Start small (land, dinky house, ‘lipstick-on-a-pig flip’)
  • Real estate is not complicated

Connect with Whitney

 whitneynicely.com

Whitney Buys Houses on Facebook

 7-Day Lead Challenge

 Resources

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


Most of us feel uncomfortable asking people for money, yet as apartment building investors we must raise capital to operate a successful business. Today’s guest argues that he doesn’t ask people for money, but offers opportunities to collaborate on projects that are a good fit for individual investors.

Victor Menasce is managing partner of US Real Estate Partners LP and author of the book Magnetic Capital: How to Raise All the Money You Need for ANY Worthy Venture. He spent the first 25 years of his career in high tech, achieving success as a microprocessor designer. But the frequent travel was a strain, and Victor realized that the days of building wealth in that industry were over. In search of a career that would have a meaningful impact, in an industry known for creating wealth, he started investing in real estate as a side hustle. His first projects involved medium-term executive rentals for parliamentary and embassy staff in Ottawa as well as local rent-to-own transactions. Victor then expanded to US markets and transitioned to real estate full-time.

His current specialty involves building new apartments in an infill urban setting across multiple domestic and international markets. Leveraging the skills around raising capital he developed in the tech industry, Victor has become an expert in helping investors divert their money from high-risk equity markets into safe multi-family real estate assets. Today Victor details the five key elements of raising capital and explains why some people repel the very money they’re trying to raise. Listen and learn from a developer who has raised more than $300 million in his nine-year real estate career!

Key Takeaways

[7:01] Why Victor views real estate as a team sport

  • Foreigners viewed as risk (lenders perceive lack of recourse)
  • Local partner facilitates investment

[7:47] The most difficult part of Victor’s transition from full-time job to real estate

  • Used savings to invest
  • Caused stress as savings dwindled
  • Chose wrong partners early on

[10:00] Why some repel money when they’re trying to raise it

  • Mistake to skip steps in basics of human relationships
  • Can go from natural progression to ‘creepy’ very quickly
  • Pace conversation so doesn’t feel forced

[11:17] The first key element of raising capital – RELATIONSHIPS

  • Build genuine relationships with prospective investors
  • People don’t want to be used
  • Forcing a connection pushes people away

[15:18] The second key element of raising capital – TRACK RECORD

  • Proof of results necessary in raising money
  • If just getting started, partner with someone who is established (borrowed credibility)

[17:42] The third key element of raising capital – TRUST

  • Goes beyond ‘dealing with honest person’
  • Includes alignment of intention
  • Decisions happen quickly when trust exists
  • Employ ‘trial close’

[20:09] The fourth key element of raising capital – COMPELLING OPPORTUNITY

  • ‘Compelling’ in eye of beholder
  • All good deals get done
  • Consider creating your own deal (scarcity vs. abundance mentality)

[25:40] The fifth key element of raising capital – ALIGN PROJECT GOALS WITH INVESTOR

  • Must be a good fit (i.e.: shoe shopping)
  • Different segments/classes of investors
  • Criteria include rate of return, control structure, tax consequence, security, risk, etc.
  • Sophisticated investors clear on all criteria

[30:55] The biggest mistake entrepreneurs make

  • Raise too little money
  • Delays, increased construction costs may leave you short
  • Victor recommends securing extra 5% equity
  • Hard to raise money when desperate

[33:28] How to invest like a billionaire, even if you’re not

  • ‘Buy on the line, move the line’
  • Identify dividing line between ‘hot’ and so-so neighborhood
  • If line arbitrary, purchase 5-10 on depressed side
  • Move line and you set value

[35:36] Victor’s advice for people hesitant to ask for money

  • Reframe as opportunity to collaborate on project

Connect with Victor

 victorjm.com

Resources

 Magnetic Capital: How to Raise All the Money You Need for ANY Worthy Venture by Victor Menasce

 Magnetism Scorecard

 Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

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

 


As apartment building investors, we realize that off-market deals are the holy grail of our business. But we also know that you have to build relationships with industry insiders in order to access those deals on multifamily properties, and it can be difficult to cold call asset managers, hedge fund operators and associates at private equity firms. If only there was a social media platform that afforded access to a database of professionals and their contact information… Hey, wait a minute! That platform does exist, and today’s guest is here to share how you can use LinkedIn to find off-market properties and earn massive profits.

Jason Lucchesi is known in real estate as the #1 off-market property strategist. He got his start in the industry with Countrywide Home Loans in 2002, serving in the mortgage origination space. In his five years there, he worked his way from account executive to branch manager, but Jason had the good sense to jump ship at the end of 2007 and shift into full-time real estate investment. He has closed REOs, short sales, bulk packages, non-performing notes, and both residential and commercial off-market properties.

Today Jason shares the step-by-step process of connecting with real estate professionals, from initiating a dialogue on LinkedIn to closing the off-market deal. Listen and learn the ‘bank language’ you need to know to communicate with asset managers and land distressed assets for 20-30% of fair market value.

Key Takeaways

 [3:01] The types of investments Jason pursues

  • 70% residential
  • 30% commercial

[6:37] How Jason got into commercial investments

  • Referred to owner looking to liquidate for retirement (2010)
  • Leveraged private money
  • Negotiated seller financing (capital gains not as high)
  • Implemented renovations to increase occupancy rates

[8:36] Jason’s first multifamily deal

[10:47] How Jason employs LinkedIn to find off-market deals

  • Initiate search for professionals with ‘asset manager’ in title
  • Determine whether he/she works at a bank (distressed assets)
  • Connect for access to contact info (email address, phone number, etc.)

[14:05] How Jason initiates contact with asset managers via LinkedIn

  • Look for real estate groups the person is involved with
  • Customize a message with mention of common groups
  • Once invitation to connect is accepted, send email and LinkedIn message
  • Initiate a phone call after a couple of days

 [18:18] The script Jason uses in dialogue with asset managers

  • Own real estate investment company
  • Nationwide investor
  • ‘Looking to deploy acquisition capital’
  • Ask about ‘assets looking to liquidate’

[19:20] How Jason works with asset managers once connection is established

  • Outlines his criteria
  • Signs NDA
  • Asset manager sends Excel doc list of properties by state
  • Receives package from asset manager once a month moving forward

[24:14] The property information typically provided by asset managers

  • Appraisals
  • BPOs
  • Title work
  • Unpaid principle balance
  • Current market value
  • Monthly payment

[27:00] The key strategy that has worked best for Jason

  • Reaching out to agents, homeowners, or owners of record
  • Learning as much about property as possible before crafting LOI, purchase agreement

Connect with Jason

Jason’s Course

jasonlucchesi.com  

Resources Mentioned

 Right Flipping Now by Jason Lucchesi

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


Paul Moore had just gotten his real estate license when he wrote his first book, The Definitive Guide to Smith Mountain Lake Real Estate. Though he didn’t have a track record as an agent, the book made things happen for him, attracting people, money and listings. The work he put into researching the book established him as a professional and propelled his career forward in a big way.

We all have a story to tell, and most of us have considered writing a book to share that story. Being a published author pays huge dividends in terms of credibility, and it’s something you can use as leverage in making deals… Especially if you’re new to the world of investing in apartment buildings. But how in the world do you get started? And how do you carve out the time to sit down and write an entire book?

Nick Raithel is the creator of 7-Hour Book, a proven system that can give you clarity in terms of what you want to write about, assist you in developing an outline, and even partner with you in the writing itself if you don’t have the time to devote to the project. He is on a mission to help real estate investors get the recognition they deserve and attract new business and investment opportunities. Today Nick discusses how publishing a book aligns with the objectives of a real estate investor, the benefits of the ‘thud factor,’ and the components of a book launch. Listen in to learn the real-world results you could enjoy from being a published author!

Key Takeaways

[1:43] How publishing a book aligns with the objectives of a real estate investor

  • Establishes credibility
  • Presents speaking/coaching opportunities

[4:34] The benefits of the ‘thud factor’

  • Physical book differentiates you from the crowd

[5:40] The most common mistake made by aspiring writers

  • Difficulty nailing down a topic/approach

[7:38] The real-world results of publishing a book

  • Invitations to speak at conferences
  • Coaching/consulting opportunities
  • Attention/leads

[9:19] An example of the 7-Hour Book Process

  • Client wanted to establish credibility in a particular market
  • Sought specific type of customer, wanted to establish themselves as most qualified choice
  • 7-Hour Book flushed out general idea to create structure around 7 principles
  • Each chapter educated prospect and demonstrated experience

[12:40] How to develop an idea for a book

  • Go to bookstores, look at own shelves to see what’s out there
  • ‘Hijack’ an idea or topic
  • Consider the angle that you’re ‘sick of it all’ and ready to share the truth
  • Or write as a seasoned veteran who can ‘set the record straight’

[14:18] How 7-Hour Book is different from a ghostwriting service

  • Focused on results
  • Includes call-to-action for reader

[16:21] How to measure those results

  • Track web traffic/phone calls generated by call-to-action

[18:04] The elements of a book launch and the associated marketing

  • Media spots
  • Reviews (make a difference in the minds of buyers)
  • Provides ‘social proof’
  • 7-Hour Book team will handle for you or advise

[19:51] How the Book Boost provides the ‘kick in the pants’ you need to get started

  • Team designs basic, thorough plan
  • Designed to allow you to write book yourself (if you have the time and ability)
  • Package is under $200

Connect with Nick

Book Boost Special Offer

Resources Mentioned

 Paul Moore Podcast Episode

 The Definitive Guide to Smith Mountain Lake Real Estate by Paul Moore

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

Direct download: MB_065_-_The_7_Hour_Book__With_Nick_Raithel.mp3
Category:Commercial Real Estate -- posted at: 7:19pm EDT

As apartment building investors, we understand that brokers control the vast majority of real estate deals – and we know that having a ‘in’ with brokers is the only way to score those elusive off-market deals. But if you are just getting started, how exactly do you build rapport with the brokers and partner to source off-market deals?

After graduating from the University of North Texas with a degree in finance, Michael Becker spent nearly ten years at Wells Fargo. During the last five years of his stint in commercial real estate banking, he focused exclusively on multi-family properties and became the number one loan producer for his division three years running. But Michael recognized that he was on the wrong side of every deal, and he made the switch to apartment building investment in June of 2014. In just three years, he has scaled the business, Strategic Property Investment (SPI) Advisory from zero to 4,300 units. Michael also hosts Old Capital, a podcast aimed at multifamily real estate investors.

Today Michael offers sage advice regarding how to cultivate a team, establish credibility and land your first deal. He also shares how to meet brokers face-to-face and establish relationships so that they will partner with you on off-market deals, as well as strategies for sourcing pocket listings. Listen and learn how to provide value to brokers so that you’re top-of-mind when deals come available.

Key Takeaways

 [3:29] How Michael was able to scale from zero to 4,000 units in three years

  • Business partner with complementary skill set

[6:18] Why Michael feels so strongly about utilizing brokers to find deals

  • Control vast majority of deals
  • Relationships with owners
  • Brokers do the legwork, bring you potential deals

[7:45] Michael’s advice for newbies on how to build relationships with brokers

  • Network face-to-face via meetup groups, events
  • Get on broker lists and tour
  • Provide brokers with detailed feedback

[9:10] How Michael scores the elusive pocket listing

  • Track record of performance
  • Known in the small broker community (12 brokers control 80% of the DFW market)

[10:58] Michael’s tips for new investors to be taken seriously and land their first deal

  • Be realistic about your resources
  • Make it a ‘we’ conversation
  • Build a credible team, including a commercial mortgage broker, management company, lawyer and insurance agent

 [13:40] Michael’s recommendations for networking events

[16:29] How to maintain a solid working relationship with brokers

  • Check in every two weeks to remain top-of-mind (without being annoying)
  • Provide value by sharing industry-specific news items

[19:00] How to source off-market deals

  • Pursue properties approaching loan maturity
  • Ask brokers about recent BPO’s in which a competitor got the listing
  • Subscribe to data services and mine for properties
  • Download and archive OMs to track broker-owner relationships

[25:48] Other ways to find off-market deals

  • Establish a foothold in a particular area of town
  • ‘Gift’ brokers with a list of properties you are interested in

Connect with Michael

Old Capital Podcast

SPI Advisory Website

Email mbecker@spiadvisory.com

Resources Mentioned

Marcus & Millichap Events

Bisnow Events

ALN Apartment Data

CoStar Data Services

Yardi Matrix

trepp.com

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

 


Society teaches us that hard work leads to a great life, so we build a career first and try to fit life into what is left over. But perhaps there is a better approach… What if we could design our lives first, and then fit business into what was left?

Steve Cook began his career in the restaurant business, but failed miserably. Success came with a move to real estate investing, and three years in he had $7M in assets. Flipping houses allowed him to accumulate a great deal of wealth, and his financial advisors were committed to helping him accrue even more. Steve was doing everything right, but he wondered when he would get to enjoy it. The business had become his life, and he was compromising everything that was important to him.

Committed to simplify his life and break free from lenders, Steve made radical changes. He stopped borrowing, downsized to reduce expenses, and pared down his work hours so that he could be the husband and father he wanted to be. In the book Lifeonaire, Steve Cook outlines his approach to the pursuit of an abundant life, and today he shares that philosophy with us. Listen in and learn how to shift your mindset, overcome cultural conditioning, and pursue the life you want right now!

Key Takeaways

[7:09] The message of Steve’s book, Lifeonaire

  • Plan of pursuing money to one day live a great life is flawed
  • Pursue a great life instead

[8:24] Steve’s moment of realization

  • Tax returns reflected $300,000 in interest paid each year
  • Slave to debt ($4.5M)
  • Consumed by work, compromising what was important

[13:02] How Steve’s life went from simple to complicated in a three-year span

  • In the beginning, it took $25,000/year to make ends meet
  • Three years later, doing everything ‘right,’ $25,000 only lasted two weeks

[13:58] How Steve simplified his life

  • Made a commitment to stop borrowing
  • Developed a life vision
  • Chose only the deals that got him closer to that vision
  • Reduced his working hours (10a-2p, M-F)
  • Downsized to reduce expenses

[20:35] The shift in Steve’s approach to real estate investment education

[21:46] How to reduce your working hours

  • Believe that it is possible
  • Focus only on the most profitable and efficient
  • Trust that the business will produce
  • Appreciate that it is possible to make more when you work less
  • Remember, the WHY will make you more productive

[24:52] Steve’s guidance for living the life you want NOW

  • Determine what you want
  • Believe that it can happen
  • Let go of the idea that you don’t have enough

[26:17] The definition of ‘lifeonaire’ and how the term was conceived

  • A lifeonaire pursues an abundant life
  • Steve had two clients who were focused on being millionaires
  • Both had the ultimate goal of becoming better fathers
  • Neither was convinced that they could be good fathers regardless
  • Steve recognized that the pursuit should be about life, not money

[29:34] Why more people don’t subscribe to the lifeonaire philosophy

  • Cultural conditioning to believe that hard work produces a great life
  • We believe we don’t have enough

[31:05] The greatest challenge for aspiring lifeonaires

  • Shifting mindset in a culture that says you’re wrong
  • Can be overcome by surrounding yourself with people who share your mindset

[32:35] How long it takes to become a lifeonaire

  • Can start instantly with a shift in mindset
  • The pursuit of joy is a life-long journey
  • Expect to see results in the two month to two-year range

Connect with Steve

 Lifeonaire Website

Lifeonaire by Steve Cook and Shaun McCloskey

Resources Mentioned

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


Perhaps you are hesitant to invest in real estate at the moment because of predictions of an imminent crash. But when is the ‘right time’ to invest? What if I told you that it is always a good time to invest, as long as you make intelligent choices?

Jason Hartman is the president of Platinum Properties Investor Network, a firm specializing in financial planning for real estate investors, and Hartman Media, a production company through which he hosts 20 podcasts that address business, investments and living well. A self-made multimillionaire and serial entrepreneur, Jason has founded 21 companies and initiated several thousand real estate transactions.

Jason obtained his real estate license his freshman year of college and worked part-time for Century 21, learning about the investment side of the industry and developing his own portfolio. He eventually came to purchase and expand his own traditional real estate firm, and negotiated its sale to Coldwell Banker. In anticipation of that check, Jason sought investment advice from Wall Street – and uncovered a need for a financial planning firm-specific to real estate investors. So he created it himself! He is passionate about educating and assisting investors in acquiring pragmatic investments nationwide. Today Jason explains why the media characterization of ‘housing’ is an oversimplification and outlines the different types of markets. Listen and learn how diversification can offer a solid ROI despite market volatility.

Key Takeaways

[4:12] The volatile nature of cyclical real estate markets

  • Receive most attention, media coverage
  • Located in coastal and trophy cities
  • Can make or lose a fortune

[6:00] Jason’s take on Wall Street financial planners

  • Little creativity
  • Don’t use the product themselves
  • Best sales force (easy to invest)
  • Worst product

[6:53] What Jason learned in researching different real estate markets around the US

  • Three types of markets – linear, cyclical and hybrid
  • Invest in more than one market for a solid ROI

[8:56] Why Jason founded a financial planning firm for real estate investors

  • Real estate has the best product, but worst sales force
  • He created the business to be his own customer

[11:22] The misleading nature of media coverage of ‘real estate’ or ‘housing’

  • Cannot lump all markets into a single category
  • Differentiate by product type, price and market (linear, cyclical, hybrid)
  • 400 different markets in the US
  • Case-Shiller Index only profiles 20 metro areas, 15 of which are cyclical

 [12:54] The differences among linear, cyclical and hybrid markets

  • Linear markets grow slowly over time
  • Cyclical markets are like a roller coaster
  • Hybrid markets fall somewhere in between

[16:04] Jason’s advice to investors with much equity who live in cyclical markets

  • Use available tools and technology to invest outside your immediate area
  • Diversify geographically (three to five different cities)
  • Deploy equity in linear markets that generate a good yield

[18:30] Why Jason cautions investors against cheap properties

  • 12% of Americans unbanked
  • Difficult to collect rent from C and D class tenants

Connect with Jason

jasonhartman.com

Creating Wealth Podcast

Resources Mentioned

Marcus & Millichap Multifamily Investment Forecast

IRR Viewpoint Report

Milken Best Performing Cities Report

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


You can lead a horse to water, but you can’t make him drink. Or can you?

You likely know exactly what you need to do to succeed in the world of apartment building investment, but perhaps you aren’t making forward progress toward your aspirations. Today’s guest explores the psychology of what holds us back and offers actionable techniques to help you take control of your life!  Rob Dial is a performance coach and speaker who has inspired tens of thousands of people – from college students to NFL superstars – to develop a clear purpose and then establish the habits that lead to success. He believes that leaders are not born, but groomed, and he is committed to teaching others how to become the best version of themselves.

Rob’s forte is understanding the human brain and how to hack it to get past the fears and limiting beliefs that are holding you back. Through his work with MWFMotivation, he seeks to help you dig deep and discover what you were put on earth to do. Today he describes the design of the human brain and explains how to employ that understanding to get clear on the ‘pain’ you are running from as well as the ‘pleasure’ you are working toward. Get ready to be inspired as Rob coaches you to shift your mindset and truly show up in the world.

Key Takeaways

[6:38] Rob’s spin on the ‘lead a horse to water’ analogy

[9:10] How our brains work

  • Problem-solving mechanism
  • Designed to keep us alive
  • Move us toward pleasure and away from pain

[10:07] Why people don’t take action – despite knowing what they need to do

[10:27] How to shift your focus to the ‘why’ behind your goal

  • Identify the worst case if you stay the same/don’t hit your target
  • Dig deep (beyond the surface level answers)
  • Ask, “What’s more painful?”

[16:34] How to motivate yourself to take massive action (when life is not that bad)

  • Link where you are now to massive pain
  • View your current situation as unacceptable

 [18:48] Why you must dig deeper than money as a source of motivation

  • Reflect on the true pain point, i.e.: control of your time
  • Peel back the layers by asking, “Why is that important?”

[20:10] How a focus on the ‘pleasure’ you are moving toward keeps you driven

  • Picture the benefits of reaching your goals
  • Doing the difficult things (e.g.: cold calls) gets easier

[25:18] How to identify and explore your personal ‘pleasure’ and ‘pain’

  • Journaling provides clarity
  • What do I want?
  • What am I afraid of?
  • Keep asking ‘why’ to get beneath the surface

[30:43] Why Rob invested in a coach at age 20, despite the expense

  • Explore strategy and mindset
  • ‘I mattered more than the money’
  • Took income from $17,000 to $177,000/year in two years

[37:25] Rob’s best advice to motivate action

  • ‘Don’t play like you get a second at bat’

Connect with Rob

 mwfmotivation.com

MWF Motivation Podcast

MWF Motivation on Facebook

Resources Mentioned

The Miracle Morning: The Not-So-Obvious Secret Guaranteed to Transform Your Life (Before 8AM) by Hal Elrod

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

 


What goes up must come down, and a number of experts predict an economic recession in the not-so-distant future. What are the current economic trends you need to understand? What would a recession mean for the real estate market? And how can y ou protect yourself from a potential crash?

I recently returned from the Real Estate Guys 15th Annual Summit at Sea, where I had the opportunity to meet several big players in the real estate industry and experience three key ‘aha moments’ surrounding the power of networking, the unsustainable economic trends initiated by our political system, and the spiritual aspect of being an investor.

The Summit at Sea was life-altering for me, and I am eager to share my new insight. Listen in as I examine the current economic landscape and how existing trends may affect the real estate industry down the road. Learn what steps you can take to not only survive a would-be crash, but thrive and prosper despite it.

Key Takeaways

[1:56] The value of networking via conferences, etc.

  • We tend to limit ourselves as we reach outside our comfort zone
  • You are only one relationship away from making it to the next level (e.g.: Michael Becker’s meteoric ascension from zero to 1,000 units in 12 months)

[3:55] The significance of understanding the political landscape

[4:50] Unsustainable global trends

  • Exponential population growth
  • Debt
  • Oil use
  • Deforestation

[5:07] The fallout from the Federal Reserve bailout in 2008

  • Printed trillions in response to the recession
  • Debt now at $20T, $30T in five years
  • Devaluation of the US dollar

[5:42] Exponential trends in growth of debt

  • Social Security out of cash in 17 years, Medicare in 11
  • $1.5T in college debt, $1T in credit card debt

[6:35] How to respond to this bleak macroeconomic overview

  • Educate yourself about the issues
  • Consider titles by Kiyosaki, Martenson/Taggart, and Griffin
  • ‘You have to see something coming to get out of the way’

[8:34] Doug Duncan’s favorable perspective of the real estate market

  • Chief Economist for Fannie Mae forecasts stability of interest rates in 2017 (pending no major policy changes)
  • Housing market currently experiencing third largest expansion in US history, yet weakest expansion when inflation-adjusted to reflect income and GDP growth
  • Present low housing supply causing prices to rise
  • Housing market likely to do well if recession hits
  • Interest rates would fall to stimulate economy
  • If unemployment stayed under 7%, housing would do reasonably well and rentals would improve

[10:00] Robert Kiyosaki’s approach to the four quadrants

  • Mindset comes first – Be, Do, Have
  • Spiritual language to describe Employee, Self-Employed, Big Business Owner & Investor

[11:43] The mindsets associated with each of the four quadrants

  • Employee – consumed with fear, desire for security
  • Self-Employed – issue with control, difficulty delegating
  • Big Business Owner – struggle with power, ego
  • Investor – not motivated by money/power, truly free

Resources Mentioned

Second Chance for Your Money, Your Life and Our World by Robert Kiyosaki

Prosper: How to Prepare for the Future and Create a World Worth Inheriting by Chris Martenson and Adam Taggart

The Creature from Jekyll Island: A Second Look at the Federal Reserve by G. Edward Griffin

The Real Estate Guys

The Investor Summit at Sea

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

Direct download: MB_060_-_How_to_Survive_and_Thrive_the_Next_Crash.mp3
Category:Commercial Real Estate -- posted at: 6:29pm EDT

Obtaining funding can be one of the more difficult aspects of real estate investing. How do you go about finding the right lender? My guest today is making the process quicker and easier by marrying technology and real estate to create an online marketplace where investors and lenders can connect.

Ross Hamilton is the CEO of connectedinvestors.com, the world’s largest network of real estate investors. He began investing in real estate at the age of 19, and soon realized that the more connections he had in the real estate investing world, the more lucrative business could be. He leveraged his understanding of technology to create what he calls “LinkedIn for real estate investors” and became wildly successful during the property value upswing. Ross then had the foresight to diversify prior to the crash, and even thrived during the crash by investing in real estate in military towns.

Ross continues to grow his portfolio as well as his network of real estate investors, as he seeks to change the way money flows through the industry. Listen in as he explains how the Connected Investors platform pairs lenders with investors, how to spot a fake lender, and how technology will continue to affect the future of financing via crowdfunding portals and social networks.

Key Takeaways

[3:22] The key to success in real estate

[3:38] The evolution of funding real estate investments

  • ‘Wild West’ of easy funding led to crash
  • Impossible to attain after crash
  • Smart investors shifted focus to real estate
  • Trillions raised to buy bank portfolios
  • Now there is more money than deals

[6:54] How the Connected Investors platform connects investors with lenders

  • Press 12 buttons and type the property address
  • The platform identifies appropriate lenders
  • Real, active, verified lenders compete via bidding

[8:35] The success of CiX

  • Simplified process makes obtaining loans easier
  • Process $1B in applications every two weeks

[10:10] The types of debt supplied by CiX

  • Currently provide recoursereal estate fin
  • Just added portfolio
  • Making strides to include nonrecourse for commercial 

[12:43] How CiX helps investors with the equity component of funding

  • Small business lender programs for CiX network investors
  • Private lenders in network willing to think outside the box

[14:54] The prevalence of scammers posing as lenders

[18:21] How to qualify lenders and identify scammers

  • Ask for recent closings
  • Verify via public records
  • Contact borrowers as references

[20:02 ] The future of financing

  • Expansion of crowd-funding portals
  • More wealthy individuals investing in real estate
  • Additional capital moving into real estate
  • Added transparency
  • Faster, easier and cheaper to raise capital
  • Evolution of the market by technology

[22:43] Ross’s advice for investors struggling to find funding

  • Evaluate your deal- it’s probably not good enough
  • Consider how you present yourself to lenders

Connect with Ross

TheMichaelBlank.com/cix

Resources Mentioned

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


When someone decides to invest in an asset, they are essentially investing in a prediction of the future. All investments carry this element of risk, but there are some assets that are much riskier than others. Paul Moore, believes that he has found the perfect investment that offers relatively low risk with high rewards. It may not come as a shock to listeners that this investment is multifamily investing!

Listen in to find out how Paul became a real estate investor, and how the “recipe” for the perfect Investment is allowing him to support charitable causes throughout the world!

Key Takeaways

 [04:26] Paul’s first experience with multifamily investing

  • Built multifamily facility from the ground up in North Dakota
  • Rented out at $13 per square foot

 [06:47] Investments to last a lifetime

  • Paul realized most of the super wealthy made their fortunes in real estate
  • Demographic trends make real estate investing ‘The Perfect Investment’

 [09:54] The changing trends in American home ownership

  • Has dropped from 69% to 63% in 11 years
  • Every percentage drop in homeownership is 1 million households into the renter pool
  • More demand than supply

 [11:52] The 3 drivers behind low home ownership

  • Baby boomers moving back into rentals
  • Millennials seeking flexibility, do not want to be tied down
  • Immigrants rent more and for longer

 [16:33] Multifamily investing return vs. risk

  • Far better than other asset classes
  • Multifamily delinquencies were 90% lower than residential in last recession

 [20:45] The recipe for the perfect investment

  • Passively invest in stabilized, value-add properties
  • Find a trustworthy asset manager
  • Find a capable property manager
  • Find a large and growing market

 [29:02] Giving back through investing

  • Paul never wants to retire
  • He wants to give back - to help stop human trafficking
  • Paul's company shares profits with organizations that are making a difference

Connect with Paul

wellingscapital.com

Email: paul@wellingscapital.com

Resources Mentioned

Podcast: How to Lose Money

The Perfect Investment: Create Enduring Wealth from the Historic Shift to Multifamily Housing

 


Finding the right business partner can be as important as finding the right investment opportunity. A great partner can bring time, money, expertise, and often prove vital to achieving your first MF deal.

Someone who knows all about first deals and partnerships is Joe Fairless, my guest on this week’s show. When I first spoke to Joe on the podcast, back in episode 10, he had just finished closing on a phenomenal 168 unit apartment building for his very first deal. Now,  2 years later, Joe has used the momentum of the first deal to propel himself headfirst into the world of real estate investing, with some incredible results.

Listen as Joe tells us what he’s been up to since we last spoke, including focusing his strengths, utilizing partnerships, and massively growing his real estate portfolio since that vital first deal.

Key Takeaways

[2:52] What Joe has done since his first deal

  • Grown real estate portfolio from $7m to over $100m in just 2 years

[3:36] How Joe achieved such rapid growth

  • Partnerships
  • Identifying his strengths
  • Finding partners whose strengths differ from his

[5:46] Joe’s key strengths

  • Identifying opportunities
  • Building solid business plans
  • Bringing in investor money

[9:59] Smart partnering

  • Joe has used partners on all of his deals (7 so far)
  • He has utilized many different types of partnerships
  • Joe always chooses partners who can provide a new strength

[16:50] Using co-sponsors

  • Partnerships can be Limited or General (GP)
  • GP’s mean bringing someone in on your side to make the deal happen
  • Joe often arranges compensation packages for co-sponsors

[21:14] Joe’s tips for partnerships

  • You might have to give up a lot to get that first deal, but that’s OK
  • Learn to identify when you should and should not partner

[21:45 ] The risks of partnerships

  • If they are property managers, they could be fired, but still own part of the GP
  • Protecting yourself from a bad partner
  • Use a lawsuit only if all else fails

[27:05] Joe’s goals for 2017

  • Make sure investments continue to perform for investors
  • Continue to find valuable opportunities
  • Continue to support charitable/education causes

Connect with Joe

joefairless.com

Email: Info@joefairless.com (Email Joe for free money raising spreadsheet tool)

Resources Mentioned

Crucial Conversations

Best Real Estate Investing Advice Ever (Volume 1)

Previous podcast episode with Joe: themichaelblank.com/session10/

Michael’s deal analyzer

Deal Maker Mastermind

 


If you’ve listened to the show before, you’ve probably heard me talk about the power of the first deal. Your first multifamily deal will be the smallest, the longest, and the hardest deal you will ever have to make. However, the power of the first deal is that the second and third, which follow in rapid succession, are almost automatic.

Jordan Madewell, my guest on this week's show, knows all about the power of the first deal. Closing on his first multifamily, a 23-unit complex, with his business partner in 2016, Jordan is on the fast-track to completing his next two deals, which he hopes will help him reach his 2017 goal of 100 units. I can’t wait to see how he gets on in the next 12 months, but in the meantime, let’s listen as Jordan talks about his drive, how he got started in real estate, and most importantly, how he nailed that all-important first deal.

Key Takeaways

[02:53] Jordan’s start in real estate investing

  • Jordan’s parents and grandparents always had rentals
  • In 2007, while still in college he bought and rented out his first single-family home

[04:05] The moment Jordan realized that he needed to be investing in multifamily

  • Released that It takes the same amount of time and effort to do a deal 10X bigger

[06:40] Jordan’s goal and his “why”

  • $5000/month passive rental income

[14:23] How Jordan built a network of investors

  • Established contacts before the deal was in place
  • Started conversations early to build investor trust

[15:20] Jordan’s first deal.

  • “lucked upon it”
  • 23 units built in 2006.

[16:30] Raising the money for the first deal

  • Syndication
  • Called network of investors
  • Raised needed funds in 72 hours

[26:47] What’s next for Jordan

  • Actively looking for more and bigger deals

[36:00] The power of the first deal

  • There is enormous power and potential in completing the first deal
  • It’s the smallest, takes the longest, and is the hardest to pull off
  • The second and third deals follow in quick succession

[45:28] Jordan’s advice for new real estate investors

  • Calculate your ‘Rat race’ number and reverse engineer it
  • Learn as much as you can, but always follow it with action
  • Find a mentor or peer group to guide and help you on your journey

Connect with Jordan

Phone: 806-570-0264

Email: Jordanmadewell@gmail.com

Web: madewell-construction.com

Resources Mentioned

The Complete Guide to Buying and Selling Apartment Buildings by Steve Berges

richdad.com

biggerpockets.com

Old Capital Real Estate Investing Podcast

 


Five years ago Brad Tacia was just a regular guy, working a 70 hour week as an engineer to support his family. In 2011 he began to invest in real estate. After making the switch from single family to multifamily investing, Brad managed to replace his income in just 2 years.In this episode I talk to Brad about the amazing progress he has made over the last 2 years, investigating the reasoning and

In this episode I talk to Brad about the amazing progress he has made over the last 2 years, investigating the reasoning and mindset behind his life-changing actions, as well as the habits he has developed to achieve his goals. From his first multifamily deal, to the syndication of a second complex, the results of Brad’s determination and decision-making can serve to inspire anyone interested in multifamily real estate investing.

Key Takeaways

 [03:05] Brad’s backstory: from 9 - 5 to real estate.

  • Brad has worked in auto engineering all his life.
  • Layoffs in the auto industry inspired Brad to seek out a second source of income.
  • He realized he needed a ‘Plan B’.

 [04:56] The thought processes behind real estate investing.

  • Now with a family, Brad was starting to think about how to secure a financial income.
  • He moved into a new family home and began to rent his old home.
  • Gravitating towards real estate, he started researching and investing in single family.

 [07:23] Thinking about replacing income with real estate.

  • Maintain flexible and ever moving goals.
  • First goal to replace 25% of income, then 50%...
  • Recently achieved goal to replace 100% of income with real estate.

 [9:09] ‘The idea was to buy one house per year’.

  • Transitioned to the multifamily market after buying his 5th single family home.
  • Did not start with multifamily because the thought was too daunting.
  • Wishes he had started sooner.

 [11:45] Making the move to multifamily investing.

  • Brad started to educate himself, reading over a dozen books on apartment investing.
  • Started analyzing deals to get comfortable with the numbers.
  • Analysed 50 deals and gained confidence in the market.

 [14:14] Brad’s first multifamily deal.

  • 12 units.
  • Agreed on $850,000 ($71,000 per unit).
  • Raised rents to market value for an instant cash flow boost.

 [19:50   ] A change in comfort zone and a shift in goals.

  • The benefits of finding a good property manager.
  • Finding more money to invest in multifamily.

 [25:25] The ability to make deals directly impacts the scalability of the business.

  • After the first 12 units Brad set his sights on fully replacing his income.
  • He wanted to cover his family's living costs, his ‘rat race number’.

 [26:04] Brad’s motivation for doing what he does

  • At first it was to provide for his family
  • Now it’s about gaining freedom with his time

 [27:21 ] Why Brad keeps doing new deals even though he’s met his financial goals

  • Brad loves analyzing deals.
  • Wants to pursue more syndication deals.

 [35:35] Real estate investing alongside a full-time job.

  • Utilize your free time in the most effective way possible.
  • Research deals on lunch breaks, use your daily commute to make phone calls.

 [36:25] Changing your habits and finding your why.

  • Do something every day to keep your deals moving.
  • Don’t let anybody else own your time.
  • Find your drive. Brad’s is to spend more time with his family.

 [42:26] What Brad would tell his younger self.

  • 1st get expenses under control
  • Go into multifamily sooner and build the right mindset
  • Start young, start early, be serious about it.

 Connect with Brad

 Cell Phone: 248-881-4570 (call or text)

 Email:  bradtacia@gmail.com

 Resources Mentioned

 The Complete Guide to Buying and Selling Apartment Buildings by Steve Berges


Kevin Bupp is an entrepreneur, philanthropist, and real estate expert. Since 2010 Kevin has been focussing his attention on the mobile home park market, the results of which he has happily agreed to share with me today. Throughout his entrepreneurial journey, Kevin has always returned to real estate, a market he calls ‘one of the easiest ways to create true wealth’. Now that he has made the leap to mobile home parks, his only wish is that he had done it sooner!

 Listen now to hear my chat with Kevin, including; how he dealt with the economic recession, his chance move to mobile home park investing, and most importantly his best and transferable techniques to close those important deals.  

Key Takeaways

[03:17] Kevin's real estate journey.

  • Got into real estate at 19 years old
  • Began his real estate journey with single family homes.
  • He was in the business for 5 years before he bought his first multifamily home.

[4:48] The recession and a two-year hiatus.

  • Took a couple of years away from the real estate market following the crash.
  • Worked on some different markets, including health & fitness and fashion.
  • A chance meeting got him interested in the mobile home park market.

[05:51] ‘The biggest small project I ever worked on’.

  • How he found his first mobile home park deal.
  • Various partnership structures.
  • He always has at least one business partner.

[10:07] Raising money for his first deal.

  • His credit was shot following the economic crash.
  • Former investor helped to finance his first park.
  • It was important to make his investor feel safe.

[11:47] Why Kevin decided to go back into real estate

  • He believes it is still one of the easiest ways to create true wealth.
  • Only way to get back to the lifestyle he was used to.

[14:17] Lessons learnt from the recession.

  • Single family homes are very inefficient.
  • Mobile home parks provide scalability.
  • He wishes he had started buying multifamily sooner.

[19:17] So what’s so great about mobile home parks?

  • Some unique barriers to entry.
  • They don’t build them anymore.
  • The only commercial asset class with a diminishing supply.
  • It's affordable housing, a market with a growing demand.
  • Tennent turnover rate is low because homes are expensive to move.

[22:20] Park management and scalability.

  • There are not many professional management companies for mobile home parks.
  • Kevin has his own internal management structure.
  • On-site manager who lives in the park.

[24:53] Where Kevin finds his on-site managers.

  • Look for tenants who maintain their homes, displaying ‘pride of ownership’.
  • You can also hire managers from outside, but they must live in the park.

[26:25] Finding new deals in the mobile home park market.

  • Majority of his deals are found off-market.
  • Utilizes direct mail and cold calling to target potential park sites.
  • Identifies target market first

[30:07] Techniques and tips for finding owner information.

  • Using TLO.com you can find out nearly any person’s contact information.
  • The information gained in this way is very accurate (but you have to meet TLO criteria).

[37:40] What would Kevin tell his younger self?

  • Buy multifamily homes and stay away from the single family market.

[41:25] What Kevin is most excited about right now

  • It is a unique time for the industry.
  • It’s a great time to be buying mobile home parks.

Connect With Kevin

 Kevinbupp.com

Mobilehomeparkacademy.com

 Resources Mentioned

 TLO.com

Real Estate Investing For Cash Flow Podcast

The Mobile Home Park Investing 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