Greed Geek

#8 - Ryan Fenton: Building a Residential Real Estate Portfolio

April 03, 2021 Jason Byrne Season 1 Episode 8
Greed Geek
#8 - Ryan Fenton: Building a Residential Real Estate Portfolio
Show Notes Transcript

Starting in 2014, Ryan began a side hustle of building his real estate empire one home at a time. With no formal training in the business, he learned by doing, and today owns 11 homes and manages a handful of others with family members. He did this all while focusing on staying cash flow positive on rental revenue in each new home investment. Ryan learned from the experts but didn't get too caught up in the analysis paralysis that can come from an obsession with complicated profit formulas and spreadsheets. We'll discuss his journey and how you can learn from his experience.

Show Notes and Additional Tips from Ryan:
http://bit.ly/gg-8-show-notes



Welcome to the Greed Geek podcast with your host Jason Byrne What is up, everybody? And welcome to episode eight of the Greed Geek podcast. Today we're going to discuss how to build wealth in a passive income stream through residential real estate my guest today is a long-term friend of mine Ryan Fenton he was one of the earliest employees at FloSports and he's a well-known track and field announcer for FloTrack today he's the director of global rights acquisition and partnerships at Flo, and all the while he's been slowly building a real estate empire. Ryan, how's it going, my man? It's going very good, Jason. I'm excited to be on with you and I love that you're doing this stuff I know you, like all of us, we all have our own little side hustles and you do a lot and a lot of the things that you do. I know you do things about history in your own community you do things like this, yeah, and but it's all I love the things that you do because it's all to help others right and to share knowledge and I love that. That's what's all about, got to create value for other people. Yeah and you notice I'm wearing my Flo shirt today. Ryan and I both have one of these coveted names up on the wall at HQ and jerseys because we've both been at FloSports for for many many years long time yep long time over a decade for us so speaking of which why don't you give us a little bit about your kind of non-real estate background you know where you come from you know what your journey's been like yeah um i'm originally from the northeast was uh grew up in in new york upstate new york uh until i was about eight years old and then my dad got relocated with with his job we moved up to portland maine and so that's where i was through high school and uh and love it there that's that's really where i consider home um and so after after high school uh i'd gotten into running i guess around the time of elementary school middle school and and and that helped me uh get into college and and went down to clemson in south carolina and uh most people probably know them for their their football team over the last five or six years it wasn't pretty good yeah it wasn't they weren't you know they had won a title in 81. I got there in 2000. we weren't quite the team we are today so uh it's it's it's nice to be a part of that you know when i when i moved to austin years later you know no one really knew where clemson was now whenever i say clemson everyone's like oh man that's awesome so uh just that that benefit i get from being associated i'll take it but um but yeah i was down although yeah it's okay oh it's okay conference we're we're in the same conference you got to have a little love loyalty there um but yeah i was in i was at clemson for for six years i did my undergrad and and grad degree ran for five years there uh i was a distance runner um and uh and then afterwards went to boston where i had my first job out of college and uh was working a essentially behind a computer no interactions with humans very often and uh it was just not uh that it was just not me and i was miserable i was there for um a little less than two years and you know just trying to figure out how i was gonna do something different and uh that's you know we you mentioned our connection through FloSports that's uh in 2007 right around the time FloSports was starting and kind of saw what they were doing and just reached out to to volunteer and and help and uh the ceo or one of the co-founders at the time was was coming up to boston literally the next week i offered him a place to stay he stayed with me uh i started you know covering track meets when i say covering track meets literally going to track mates for uh 10 to 12 hours a day overall yeah over the course of a weekend and just filming and commentating track races and uploading them to the internet which today seems very you know obvious and common but back then no one was doing it and so that just consumed my world uh at work outside of work you know just getting getting prepared for that coming weekend's event and so within three months uh quit my job uh the the founders of the company asked me if i i'd come to austin and uh there i went so uh that was 13 years ago um and i'm i've been actually just hit my 13-year anniversary two days ago so i've been been in austin ever since yeah i mean obviously in the early days you guys were hustling like sleeping on floors all kinds of crazy stuff um but over the years you know you've done a lot of other things with the company as the company's grown you've done some you know product management you know with me we did that together a lot of long nights with that uh and then now you're into into rights management like so negotiating deals with uh with big partners out there yeah yeah uh negotiating media rights deals so um you know i oversee a lot of our endurance sports so running swimming cycling uh you know anything in the weightlifting crossfit space and then uh even work within kind of college and national governing bodies so there's a lot of different partners we deal with and and my chunk is only a portion of that so um but yeah it's it's uh it's been an adventure you know as we were a very um very grass roots and started you know just doing local events and now we're partnering with folks like the tour de france and uh competing against the nbc's and the espns of the world so the uh the the times have changed and and uh yeah there's a lot at stake so it's fun and never a dull moment and uh you know trying to trying to continue to grow help help the company grow and and do more things so so a trend i noticed with you is that you do a lot of jobs that you have no business doing you know no background in journalism no background in product management no background in rights negotiations and no background in real estate how does that work i mean it's it's it's interesting and and some some may say and even sometimes i may say to a fault um you know like i you know especially at sports i mean i started when as you said it was it was the the three co-founders and myself living in a two-bedroom house and so the connection that i have with the company is is much different than i just if i had taken a job somewhere and at an established company and so my my kind of mission and and view of my role at the company was as we grew and we we started going into places where we didn't have someone to fill a role i wanted to be kind of a solution right and uh and help where i could and so you know in some ways it i kind of put my own uh some of my own personal uh accomplishments and kind of the things that i built up over the years aside to help the company and that was that was my choice and so um you know that fortunately you know we we acquired a company called MileSplit, which Jason you and Don Rich founded and that was a one of those times where it it was a time for me to pivot within the company and uh oversee essentially a merger of two organizations and uh that was that was challenging in many ways but so rewarding uh and honestly yeah the work that you and i did together you mentioned up till 3 4 a.m uh doing things we probably had no business doing because just lack of experience but we were just you know trying to make it happen and improve the you know improve the company improve uh the experience for all the fans and the communities that we serve so you know a lot of it is kind of uh hustle and fake it so you make it um is was it the same for you with real estate like how do you so how do you jump into doing real estate with no background in it um probably like a lot of people you know thinking it's time to buy your first home you've rented for so long and and uh and and it's kind of time to pull the trigger and you have that thought in your mind oh i'm just throwing this rent money away you know i should put it into something i'm going to own it and for me it started a little before that when i was in maine i had a friend of mine who uh who i mentioned i ran track and so there was a runner a few years older than i was one of the best runners in the state and and years later uh i really out of college we reconnected and and formed a friendship uh and at that point he was pretty heavily into real estate and then and it built up a pretty decent portfolio and i i don't even think i realized to what extent at that time um but had a really cool story he you know had a college loan and used that money to get his first duplex and uh and then kind of that got him started right and so that that spiked my initial interest in real estate and that was pretty that was really early on then yeah this was probably 2005 2006 and uh so in 2007 i started looking at property when i lived in boston and i looked in my hometown of portland maine and uh almost pulled the trigger on on a three unit in downtown portland and then FloSportsf came around and and i had the opportunity to move to austin and so i you know real estate got put on the back burner at the time um and so it it really was a couple years before i started looking again because my my life at that point was traveling every week and so real estate was not even a thought and and it just was focused on what we were doing with the company it was a startup and and so that was that was the the grind right then and so it wasn't for another probably two or three years until i started looking again uh so that was in 2010 and still just on the road so much so it didn't really look serious put it off to the side again and then came back around once once my schedule and kind of the company grew to a point where i wasn't on the road every weekend it was about 2013 and and that's when i started looking seriously and and kind of looking weekly and the market at that point where you know five years after the you know the housing market crash and so you know real estate and austin was picking up it was getting very competitive so i looked for a full year uh before i could could buy a place and you know i think i started probably like most first-time home buyers where you're very picky you don't really know what you want you know you you think you know but then you start going to see things and you and you learn along the way of was the was this a home the home that you were going to live in first right correct yeah okay yeah and so the the investment side hadn't really hadn't really kicked in yet um and so that through that first year i think what i learned the most being in austin was get less picky and get ready to move quick because the market at that time i mean i think we all know the market's pretty crazy now throughout the country but even then there were there were properties that i could not even look at unless i was under contract and we were putting offers you know 20 000 over the asking price and not even getting a call back and so it was just it was super competitive even and as a first time home buyer i just i was i had no idea what was going on it was really frustrating um and i think it was about 10 or 11 months into that process where i said to my agent at the time you know it was about it was november so i said hey thanksgiving is coming up christmas is after let's just kind of put a pause on this and come back after the new year and i went for a run that next day and and checked my phone and a house popped up on the market and it was in an area town where most people said you shouldn't you know no one really lives over here you don't go over here um and price point was super low square footage was really high and i was just like you know what i'm just gonna go take a look so i go pull into the neighborhood and find the house and and the agent the selling agent is putting out uh open house sign and so i was like well i might as well might as well go in so i went in it looked great it was four bedroom three bathroom house and uh and drove around the neighborhood it looked cool and i was just called the agent i said hey false alarm yesterday i think we should put an offer on this place so we did and uh we lost the house we didn't get it um and uh a week later i was in orlando jason at the at the bowerman award uh uh awards competition that i helped host and um my agent called me about a week later and she said hey got some news um the the buyers had to back out because they had a family emergency and the sellers want to go with you and i said let's do it and so um and at that point i was going to maine for christmas so i closed on my first house i wasn't even in the state and um and that's how i got started and and where the investment side quickly kicked in within a matter of weeks was i listed that house on craigslist before i even finished the purchase process and by the time that i was going to move into the house i had three bedrooms rented and after all expenses because you know utilities and lawn care and whatever else was included i was cash flowing like 365 dollars a month so it was a little of over $4300 a year and i had just been paying about $1650 in rent for the the previous year yeah so almost 20 grand and so that was a $24,000 swing in my life and i was like wow holy cow i need to do this again and i need to do it really quickly so you were so you were living in one bedroom running out the other threes that were you doing yeah yeah okay so some people if you know bigger pockets is a is a real estate platform a lot of people follow and so the you know i think they've coined the phrase the house hack um and so i think you know for some people they might call that a house hack you know you buy in and rent out the rooms and and live in it and then uh and then move on to the next so was that in south austin is where that was yeah you could say south east austin so just south of uh you know if you're anyone's familiar with austin town lake or lady bird lake that runs through the center of the city it's on the south south side and in an area called montopolis okay so you're so you're in this house running out the rooms and then and then you go to buy your second house what am i right your second house was in the same neighborhood it was it was a street over yeah yeah so so how did so how did you kind of i mean that's a big commitment right you're going into this into a lot of debt then when you kind of take on another home is that was that scary um it wasn't you know i think the once once i saw real estate in action and how it changed literally changed overnight the way that my it affected my life just with the amount of really financially how the swing had shifted things so drastically so quickly it gave me a lot of confidence and i think at that time part of you know one of the benefits for me is i didn't look i didn't over analyze i didn't and some people you know i started talking to other people and friends of mine that did this and they're like what's the roi what's it you know i'm just like i didn't even know what they were talking about because i didn't i didn't look at it that way yeah i looked at it very simple i said is is um if i had to rent this out in a worst case scenario would i be able to cover the mortgage right if if i know what the rents are now but let's say something happens rents dropped significantly do i feel comfortable that i could cover this and the answer was always yes you know if i and and i kept it really simple and you weren't worried about like not being able to run it like vacancy and all that kind of stuff no no i mean in in austin at that time it was it was less about if you could rent it was more in the area i was how much i could rent it for um and austin was getting more expensive and so you know the the the area i was in is an area like i said people said oh people don't live there you know people yeah that's not where you would buy but it's still very close to downtown and so as downtown and and other areas started getting very pricey this was a great alternative for folks um so i always had a really positive experience in in that area and ended up you know that's where i'm actually invested a lot so then you move into the second home after that i did yeah so that was my that ended up being my strategy is um you know i would i would buy a home i would live in it i would rent out the other rooms and i would you know essentially be living for free and in a lot of cases making money and so that allowed me to save very quickly um you know i was my paycheck from work wasn't going towards a ton of expenses and so it allowed me to kind of build up capital to uh to to get to the next project and and the benefit of doing that for me uh and others that do it is that when you buy a home as a primary residence you're only required to put five percent down okay so when you're when you know i i told you that example where there was a twenty four thousand dollar swing in my in my world in one year well if you're looking at that time the houses i was buying were around two hundred thousand dollars two hundred and two hundred fifty thousand dollars so you're talking about ten thousand dollars uh to get into a home and i and i just saved myself 24 grand by buying my first house right and so that that ability to save money happens super quick um and so you know essentially the you know you learn a lot through the process and and kind of the how to navigate that but essentially you you you if you're buying a primary residence you you need to wait about a year before you can do that again and so that was a year for me to save up money and uh and then i was able to ready to move pretty quickly to the next project so were they fixer-uppers where you moved in were fixing them up or were they kind of you know already you know in good shape uh most of the ones that i i think actually almost all were in pretty good shape um so there's only one house really i i've remodeled fully um there's houses now along the way we've updated floors if there was carpets you know you put in hard surface or things like that but um i was fortunate where most of the houses that i was buying had either already been updated or were were in pretty good condition built in the last 10 years and so they weren't you know weren't in terrible shape and ready to move in right when you got it so so last count i heard is that you were at 11 or how many houses are you right now yeah so i so i i've right now i own and manage a portfolio of about 15 properties in austin 11 of those are mine for those are family members that i help if you're talking most of those are single family homes with a couple duplexes so um of those 11 i think there's about 16 units rental units within that so so yeah so that's uh just yeah just been been pretty fortunate in in terms of kind of the area i was able to invest in and and and get in you know i i think the area i i started in was an area that again was overlooked and so you know that's not the case at this point um it's it's an area that's developing now and a lot of a lot of bigger uh bigger projects are going in over there and so the numbers the numbers today don't make as quite as much sense as they did when i started so uh so yeah just good good time you know so then have you looked at have you moved to other areas that maybe are now overlooked or are you still in the same area when you're investing um i i like the area i'm in i've i've gone to other areas as well um some a little further south some a little further north but no i wouldn't say there are any areas that are overlooked um it's hard to find that in austin nowadays i mean every areas um you know the the values are going up and and you know to make the numbers work nowadays it's it is hard if you're looking at if cash flow is one of your goals so you're married now i doubt you're still doing the you know moving into a house and living there and you know that that kind of thing anymore right yeah it's a little harder um i mean that's you know that's one of the things that i would say is that for me my life allowed me to do that at the time you know if i was a single guy and uh didn't have a ton of responsibility outside of work and you know whatever whatever it was i needed to look after personally and so uh it allowed me to do that pretty flexibly and um and so how many times did you did you do that kind of flip or not flip but you know what i'm saying yeah um it was so the 2014 was the first for was january 2014 is the first house i closed on and i probably moved let me say one two three um i think there's about six houses i lived in over a span of about four or five years it must have been exhausting to pick up your life and move so frequently i mean yeah it was it was and and in the beginning you know i was in you know my first one i moved across the street right essentially one one block over and so you know you're you're like oh i'll just move my own stuff and you're doing trips back and forth and uh you quickly realize you've you know i found some movers that uh through a friend and every time i moved i just called them i said hey moving this day i'd pack everything up they'd come box it or pack it up move it over yeah so there's things like that that um that definitely alleviated some of the stress of the move that you you know you find it's worth the value of of paying some movers to help you uh when you're doing it so frequently so so i you know i got this spreadsheet up here oh look at you you know you so i i'm jealous of you because i wanted to get into real estate you know years ago i had a little money in the stock i put it all in the stock market i mean i've done it right in the stock market but um you know i was doing all these these in these calculations and how many years is it going to take my money back and all this kind of stuff and i always kind of scared myself out of it um i'm just curious like have you gotten more sophisticated and and you know started you know here's these big spreadsheets of you know your this discounted cash flow and this you look you look on cash on cash return you talk about bigger pockets this is what bigger pockets is going to teach you so i'm just curious have you gotten more sophisticated over the years are you still kind of like hey if i can cover the mortgage um i've i've gotten more sophisticated i mean roi is something i look at um but i don't i i don't get i i've you know i actually subscribed to bigger pockets uh i think a year or two ago and and just did it for that year and and kind of looked in some of the spreadsheets and and it was good and it was helpful but i also found that it got me overthinking and i was i was i was look you know there's so many different things you can put in there right and i think for me i know the market in austin at least where i invest and i kind of know how how my you know the properties i have have yeah uh have operated and and how they've performed and so i have some confidence to to be a little more flexible with how i look at the numbers um and so so i do have i do have ways i look at it but i don't you know the spreadsheets i have i i think i i i do a pretty see i guess you could say a pretty uh deep dive into really monitoring kind of the the financials and expenses on on the properties that i have and so when i go into a deal you know i'm pretty confident that if you know the cash on cash return makes sense at a certain point and i understand the roi then um then i'm i'm pretty comfortable with with knowing you you have to go at some point you have to go into real estate knowing there's going to be expenses yeah um and so whether it's an hvac or a water heater or a roof i mean those things are just going to happen and so you just have to be you have to you when you get to a certain point you just have to be prepared for that right and have reserves uh kind of handy so you it's not a it's not a scary thing and and you just know that's kind of part of part of what you're signing up for and uh and you're prepared for that so so one of the things that's already always scared me away from it is i'm not a handy person i can write any kind of software application you ever wanted but i can't fix you know my wife builds the furniture if we buy something from ikea or whatever are you are you hands on do you get into the houses and you know fix the toilets and whatever you know not a lot um i say that i was this morning i you know there's a property that i'm turning over and some new tenants are moving in and so i was over there this morning replacing light bulbs and changing locks on doors and uh so there's some basic things that i can do and you know if someone doesn't have hot water when they first move in i can kind of understand and pinpoint and stuff would say you know there's certain things you kind of learn along the way that uh you can save yourself a couple hundred bucks from calling someone to go over and check it out when you you know it's a simple solve um but we you know an example of of where i quickly found that i value having someone come do the work for me is you know there was a toilet issue at a house and uh i think it was running and i needed to replace something you know and i guess so i got the parts and um i i can't even tell you the name of all the parts so so that kind of gives you my the extent of my knowledge here but uh there's some there's like a rubber piece i had to put in the toilet and did all this stuff drain the water put it back together filled the water back up and i was like man i am i am a handyman i can do this right and i flushed the toilet and all the water just spilled out onto the floor and i was like i have no idea what i did wrong here and uh and apparently the toilet i had at the house was one that wasn't a standard size and so i just bought the kind of standard replacement part so anyway it was a very simple learning experience to say i'm just going to get the plumber over here to make sure this is done correctly uh so i you know i i've built up uh a team of folks that that do work for me in different aspects if it's plumbing electric handyman uh fences you know and so you have those people that you can trust and call on when things come up and they give you a good price you can count on because you know you're going to be recurring business for them yeah yeah and you and refer you know i always refer uh my friends that that need help to to the people i work with and so i try to look out for them as best i can and get them more business what about as far as the actual like working with the tenants and collecting the money like i i assume you do that yourself and you don't use a rental management company yeah correct correct so is is that a burden and what are some of the stresses with that um so it's i in the beginning it was more of a burden i think and and because i was acquiring property so quickly when you went from one to two it's not that that big of a deal when you go from two to three it's you know it's pretty manageable then i think i went from three to four and number four had two units and so now i was at five units okay and so and then each house has multiple tenants right within it and so like that that builds up pretty quickly um and so you got questions coming in text and email and people are paying through paypal and venmo and check and so you have all these different things coming in and so um fortunately for me the the realtor i have have now i've been working with for a number of years and and he also is an investor and um he's been someone i've been able to kind of lean on as i've i've scaled up and and so one of the things we talked about is is you know property management software and so um so i had to use so i used a service called buildium okay and so through that i think it's there's probably a lot of functionality i i don't even use fully but i mean the the biggest thing that i'm able to do is uh create a tenant portal for the tenants so they have a place they can go online and pay rent they can submit any maintenance issues uh all those things and so that that rent now all comes in in one place uh in the same way and then uh maintenance issues come in it's you know people are less texting you or are calling you at all hours they kind of know there's a process and they go through here and that job gets assigned and they can kind of see the process of it getting worked on and know when it's scheduled and and so it gives them more uh kind of transparency and communication through the process when when things come up um and then the big thing that it does too is um you know i was fortunate where my parents they retired and moved to austin um and so you know so i mentioned i i helped manage some some other properties and so my dad has some some rental properties in austin and so uh he and i now work together where it was very easy for me to plug his property into the software and now he's helping with some of the day-to-day um where you know i may focus on kind of rent collection and when houses turn over and he's focusing more on the day-to-day maintenance stuff that comes in so once that system was set in it was really easy for me to assign another manager and for him to now get the notifications and start and kind of pick up and run with it now is that a server that just charges you like by the number of properties you have or yeah i think it i think the way they the way buildium works is there's a you know it's a monthly subscription cost for to use the software and it's a certain price when you're up to x amount of properties and then if you have more than that then you're you know you're the price goes up so yeah well the other thing i'm curious about is you know you when you have that many properties you got to make sure you have the right tenants and is there not a lot of due diligence you have to do before you agree to let somebody move into one of your houses yeah there's a there's a lot of due diligence um and and this is another aspect where that software has helped made that pretty efficient um but there's you know you're doing background checks and credit checks and there's a rental application and then you're checking uh past landlord uh with past landlords on on these tenants you have to verify employment and income uh so there's a number of steps and i think in the beginning you know i i was probably less diligent about that because again i didn't have as many properties in the beginning and you have less tenants and uh in some cases it was people i knew and so you could be a little more flexible um but then there was a situation where you know i i did actually go through the process and um i didn't call on all the references or or the or the past landlords and there was a there was some some pretty significant dings on the credit and uh some of the background check stuff and you know you you try to help people out and and be as flexible as you can and so there's there's always a story that comes with why something is is is uh maybe not coming out and and looking you know squeaky clean and so um i i you know i was trying to help this tenant out and allowed them to move in and i mean almost immediately it just became a very very big headache in terms of collecting rent and communication and and all that and so that 12-month lease was was very challenging um and i ended up getting uh actually was very fortunate where i ended up getting end up collecting all the rent throughout the year but it over you know say it's april 1st it maybe in some cases took me till april 24th and a series of three or four uh trips and meeting up with the tenant and at the bank and to get that money and so it was just very time consuming and so again that's where when when you go into something like real estate these things are in place for a reason and you sometimes try to cut the corner and or maybe be flexible and and and try to help someone that seems like they're in a tough situation but you always have to remember that that's going to come back on you uh and that and and your time as as so many people say is your most valuable asset and it really can throw off your world when uh if you're especially if you're man you're the one managing it and yet you have situations like that come up so it's it was a it was a pretty important learning experience for me and uh just really reinforced how important those kind of initial stages of that uh that that tenant checking is so was that your worst situation because i mean a lot of people that have been in that do this i hear horror stories about oh we have this tenant they trashed the house they ripped out all this stuff and i mean have you had any really bad things happen like that that that was the worst uh i would say and again it was just such a such a time consuming thing for 12 months and uh and so you know there's things that happen i mean i've had tenants that haven't moved out on time and and you know you're in situations where you have new tenants with a new lease starting and you're trying to figure out how to navigate that and that's only happened one or two times but those things come up in terms of you know damage to the property i don't i haven't had any major major major issues like that you know there's definitely situations where maybe you have a tenant in there for two or three years and you quickly know that they have not cleaned that place in two or three years and so you know there's there's some significant work in in cleaning and painting and and those kind of things but again i think you have to go into it knowing that that's part of what you're signing up for you know there's there you know i may have a tenant that's gonna kick holes in the wall at some point and i just i you know that that's part of this right and um and and it's you know so i think when you have that understanding and you know that is a is a possibility it it helps make it less stressful it doesn't alleviate the stress right because there's a lot of work to be done uh but it doesn't it this the kind of shock or surprise of it isn't there and and and that's i think what probably causes a lot of people to either not jump in or stop right or maybe they got one or two properties and they had a bad experience and they're just like man this isn't for me now do people put down a deposit so you at least cover some of those kind of spending yeah yeah yep so everyone i mean in austin and uh at least in our market yeah there's a security deposit normally it's equal to one month's rent in the way that we do it um and so there's you know there's some protection there but again it's um it's time and it's work and and the more that you have to do the more time and the more the more money and and the deposits don't always cover some of the things that that were left behind when people you know leave trash or leave uh leave things behind that you have to haul off and those kind of things so so ryan i'm just curious what has been maybe your biggest success story where you've come in you've got a house at a great price and made a really good profit on it you can come on i mean my first house i would say um i mean that's a that's you know that's that's a pretty easy one i think again it was just once i once i did that and i say that because it was one that i was like nervous about in the area and all these things i told you i was listening from other people but um you know the the returns that i've i've gotten on the house through the rent through the appreciation you know you there's so many things that you can do with property that you don't realize when you first start uh and even when you talk to somebody it's hard to explain everything right but through you know the appreciation and the ability to to refinance and do a cash out refinance i mean i've i've made well more than my money back on that house and so the returns on that home at this point are kind of infinite and so that houses has allowed me to buy other properties they're doing things like a cash out refinance um and so yeah it's just it's it's significant i think it's probably if not at this point it might be more than double in value from when i bought it in 2014. so i it just yeah it was uh that one was again kind of set me off and i would say that was my biggest success for a number of reasons have you just held on to all your properties and just run them out or there's some that you also sold i i'm not sold to this point okay no and and people ask me my wife asked me you know hey are you you know are you gonna sell when are you gonna sell um and i i i look at it i try to look at it from an investment mind right and i say i i will it's an investment mind or a family emergency mind i guess i should say um you know you have money in the stock market jason so like if you had money in a stock that was doing really well why would you say would you would you sell it right and and so the answer is i will sell it if i can take that money and put it in something else that will perform even better right right and so that's that's the way i look at it right now and so there may be a time where that happens or you know maybe there is a point where you kind of graduate and are looking at bigger more significant projects um uh and and maybe that's a time and maybe it makes sense but again it's it's you kind of run the numbers it's not an emotional decision or a decision of oh man it's too much work i think i would first say all right how much would it cost to get someone else to manage this and let's run those numbers um and then again and until there's a reason to put that money elsewhere or we have something come up in our family where it's money that we we we need in a situation like yeah the plan would be to hold and for the moment now are you diversified in in your investments like do you have money in the stock market you have money in crypto you have money other places are you like i'm all in in real estate um significant portion for me is in real estate uh that was kind of the avenue i found first that really just kind of was all consuming for me when i started and so um i i've i've been you know we i think there's things like roth iras and 401ks that i you know have money in and so some of the traditional stuff uh i've been less involved in the stock market again my focus has been more on how do i how do i build up on the on the real estate side yeah and so that that's been uh that's been a main portion i've got a very small amount invested in crypto uh i think i invested that at like the top of the market in in 2018 january 2018. it's fine now uh and yeah and it and it bombed very quickly like within a week and so it was a a month or two ago i had i literally hadn't looked at it in about a year and i was like wow i'm finally positive so uh so yeah so um hindsight i probably should have put more in when when it bombed so yeah yeah so uh but yeah so so real estate's been the main vehicle and i think now we're at a a point where we're starting to look at how do we diversify and uh start planning and i was going to ask like from from here like you you have you know 15 are you going for 30 or you're like hey i'm good here you know what is your what is your goal uh i think the goal at this point is just um you know in investing in a way whether it's real estate whether it's stock market and this is where we're actually actively you know my wife and i are actively going through this process and uh kind of learning and other ways we can we can make investments is just how do we grow our overall portfolio right and our net worth and that's kind of the the one of the numbers that we look at and when we think about what we want to do with our lives when we want to retire it's kind of the bigger picture of uh how are the decisions we're making today helping that that picture down the road and that net worth that that will allow us to kind of live the life we want to live yeah so do you i mean are you a i don't know if you've read like rich dad poor dad are you like an ascriber to like i'm gonna build these personal like uh passive income streams is that is that like really the ultimate goal that's yeah that's one of the goals for sure yeah i've reached red rich dad poor dad it's a great book i really enjoyed it um and and i actually have my my wife read it because i don't think i'm always the best at explaining why i do the things that i do uh and i read that book and i said this this would this will be a very good like eye-opening uh way to get into my mind and help you understand how i look at things um but yeah investing into assets and and all those kind of things so how do you build up passive income streams and and again for me real estate's been one of those and um and and the one that i focused on more recently uh obviously in the last few years so so um so yeah we're those are things that we're trying to trying to figure out how to grow and and how to get to the point where we're you know the the phrase i think everyone likes when you when you start getting into this is financial freedom right how do you get to that point and uh and and you're able to really focus on uh the things that you love that could it could be your job and your family and all those things but just where you're doing things with uh essentially no stress and you're not worrying about what happens if uh if a situation comes up that you weren't prepared for um so i think that's that's really the ultimate ultimate goal yeah so you mentioned you know your dad's got into the action with you is jess also does she go out of the negotiations with you or is she getting involved as well or it's like your thing yeah no i we've we've all kind of got involved uh you know jessa has brought a few properties along the way before we got married my dad bought a few properties when he moved to austin it's been it's been fun to work kind of with with our family on that because i think it got to a point you know my parents were really excited when i bought my first house uh and they were a little excited when i bought the second house but they were it happened really quickly and they were like okay all right and then when the third came and the fourth game they were like hey what are you sure you know what you're doing and it was one of those it was it was really a kind of a significant moment for me in my life where you know your parents started to doubt the things you were doing and i had to educate them it was something that they had never experienced and so yeah um so you know i try to be very open my dad's a numbers guy so i try to be open and show him you know all the things that i'm tracking and looking at and making sure he knows that hey i'm going into this with a lot of knowledge and understanding i'm not not flying by the seat of my pants and so when when they retired and moved down here it was about i think four four years ago or so um you know they you know my dad was you know retired and was trying to figure out where he was gonna put his money and he had you know 401k and it was had been in the stock market and and was just trying to see if there was other ways to do it and so i introduced him he started looking at property i remember and i introduced him to to my agent and he was a little reluctant he's my dad is a very uh very loyal man and so he had started working with an agent and uh and he's like you know i started with this woman and i'm gonna kind of honor that and and i said well listen just hear me here right this is this is the son now trying to convince the dad of something that he thinks will benefit his father financially and so it was just a kind of the first time i'd been in that position and i said just humor me here and just me meet my agent out for lunch if you know if you like it great if you don't like it that's fine too just i would love for you to have a conversation with him uh and he went to lunch and he would said oh my gosh that's amazing i'm gonna start working with him tomorrow he was so knowledgeable right and that's where i feel fortunate my agent is is really good and and and i think a lot of people maybe have bad experiences with agents or just you know some agents are just not as knowledgeable as other and so you you have some people have the view that agents aren't really valuable there's you know they're just kind of get you into the house and they they submit a contract or an offer for you and that's kind of the extent of their their role but when you find a real good agent and they understand investment and they understand ways that you can work with your money and how you can uh you know work with a lender in a better way all these things it just puts so much more power in your hands when you're trying to win deals especially in a competitive market and so it was cool to see my dad quickly uh quickly see that and and he kind of jumped on the train and and and got two properties like uh pretty quickly so um so yeah it's been fun to see uh family get involved as well well now if we have still have some viewers with us 45 minutes into this they must be pretty um interested and uh one would assume that they might want to get started themselves right so um let's turn it to like that speaking that person out there like they're like okay i'm in i'm ready to get started uh what would you tell them what are some of the first steps i would say um i would say try to start building your network and learning the process um i have so many friends that want to like over the years that have said oh man i wanna i'm gonna get a house and i wanna i wanna try to get an investment property but it's just the time isn't right you know i'm not ready to do it right now and i always point to it took me a year to buy my first property right and you know jason we were talking it took me six years to get to the point where i was actually looking seriously to buy my first property and then it took me a year to actually to actually get get the property under contract right and so there's so much unknown and so when you start when you're actually ready to buy you have the down payment you kind of in a financially in a position to do it most people that's when they start learning of what they're supposed to do and while that's happening you're kind of missing deals and and when you go through the process you have to you have to learn the things you're actually comfortable with there's there's a whole process of actually learning what properties you think you like and then what you actually end up buying are very different right so there's so many things to learn and so what i would say is start building your network like reach out to lenders start some relationship with lenders have them run numbers for you right hey i'm interested in buying a property could you give me can you give me a pre-approval what do you need for that and and start understanding what you could actually get approved for right and and talk to the lender about the things they're looking at and what they need to see and and so you know that process because that is that becomes a major part of the the home buying process right and or the investment process um and so i would also you know when and when you get to that point i think one of the other things i would recommend is a lot of people they're like oh i was pre-approved for a 300 000 home right and that doesn't really mean anything what you really need to understand is is the the monthly expenses that it's going that you're going to incur right like and not address the mortgage right yeah there's mortgage there's taxes and insurance i mean at a very at the very basic level those things yeah but at the very basic level know what your your your full payment that you're guaranteed to make is through taxes insurance and uh and your mortgage and and make sure that those numbers make sense in your world right and maybe you're approved for 400 000 but really you should only be going after a house that's 250 or whatever the numbers might be and so understand what that is so you go into it with a clear picture of uh of what you need and even your down payment you know i bought my first house and i thought i had to put 20 down i didn't realize i only had to put five and so it wasn't until very far on the far along the process once i was under contract where i said hey do i have to put twenty percent down and someone said i forget who i talked to it might have been my agent at the time and they just said no but no one went a step further and said no you actually only have to put five percent down so i just i put fifteen percent down okay you know so i'm just you know in hindsight i could have saved a few a few thousand dollars you still did all right though yeah so but you know and yeah but it's again just things that you don't realize you don't know and so waiting to actually get a house under contract to start learning these things makes it pretty stressful and uh so i was just going to say one of the things i that impressed me earlier that you said was you know just like in this in the stock market like there's a big broad stock market and you're there's no way that you're going to know more than the investors across the whole market but you can find this little niche in the market where maybe you have a little advantage because you know it's software and i don't know software a little bit better so to me it sounded like like you zoomed in on this neighborhood that you learned really well this part of boston where he's like i see opportunity here where maybe other people are overlooking it so i don't know that's part of the equation as well finding a place where you know it really well maybe you studied the market in a certain area for a while first is that you think yeah i think well i i just realized people were overlooking it right and i was i my first two purchases were really successful for me and i said i'm j if i can find more over here that's what i'm gonna do and i think um i think of the i think it's more than half of the the properties i own now are in that area um and so again i just tried to move as quickly as i could because i saw the market going up and uh things were good deals and i saw more people moving in that area i saw more development starting to happen in that area and i said it's still it's still overlooked and and so if you're in a market where you can find that then yeah if if if you can do it take advantage of it as a as quickly as you can um but it's hard to find that right and and like i said in austin there's there isn't really there's not many of those spots anymore that allow you to uh to get into something in cash flow unless you you know unless you're trying to put more more money down and then you know you can always find a way to cash flow but um for me i was i was trying to figure out how can i put as little money out of pocket and to get a property and still uh have good returns and uh and keep moving and where do you go to estimate the like what rental rate you think you can get so you can make sure that you know your rent is going to cover the mortgage or whatnot um i mean i i always first go to my my realtor you know i mean it's very easy for realtors to run comps uh my realtor also owns rental properties themselves so he he not only can he he pulled the information but he's also in in the market and then you know i'm obviously in certain areas i'm in as well and have a good pretty good uh pretty good idea what what rents are so i think it's just yeah just asking um you know there's there's the zillows out there that have the rent the rent estimator sometimes those are accurate sometimes they're not um and and ultimately you know all it takes is is one person that needs your place at a price that they like and uh that may that may not align with you know i've had and i say this because i've had properties where zillow says hey it's fifteen hundred dollars and i rented it for twenty one hundred dollars um and so i would just i would just yeah ask the questions check with the realtor um talk to other people that if you know other people that are investors in the area that that have experience what what are they renting things for um and you can get that information a number of different ways okay and and you mentioned your subscriber to bigger pockets are some of these communities uh is that really beneficial do you think somebody's just starting out should kind of join these communities to learn from others i think i think it exposes you to a lot i think the that i would definitely i would definitely look at it and find the things that you i mean you can get ants get a lot of answers to a lot of questions that you have so they're valuable in that way i would caution to get too wrapped up in the numerous ways you can analyze and what i would say is over analyze things um to try to make the perfect deal because i you know part of real estate is like you just got to start getting going you know and you may make a mistake or two along the way but i think fi you want to find a good deal to get started that's obviously ideal because that that kind of gives you a good first experience and gives you some confidence to move into something else um but don't you know understand what you're looking try to understand what you're looking at and don't don't over i guess don't overdo it is what i'm saying there's somebody but you did say earlier that you know you you analyze like okay what's the worst case scenario so yeah make sure that you're still covered in that worst case scenario yeah yeah 100 you got i mean and that that was the comfort for me right at the time i was just like can someone else cover the mortgage payment on this if i'm running it out right and where i'm not going negative and so that was like that was kind of my guiding compass and and that was talking to my agent about what rental rates were and has he seen you know what has the market seen over the last 10 years are there times where the rental rates have dipped and you know kind of understanding what that what would actually lead to something like that yeah um so so yeah but and i think you know going back to the question on on things like bigger pockets and one of the things that that is actually pretty valuable is they have forums on there and so when you have questions uh you can post on the forums and and i've only done it a few times but i i think i i said hey if you guys had i think my question was something like if you had 100 000 how would you invest it right now and what market would you look at and i had 50 or 60 people that were just like you know and it was great it was a great conversation it kind of it actually some people were talking about not just buying property and it was uh a whole number of things that i had never even heard of and so it kind of opened my mind to wow there's all these things that you can do but but again that's where i caution and say you know for me i i've been very focused on kind of what i'm doing and so it's really easy to kind of look at some other options and things other people are doing and then you start do you know uh you kind of start going away from a sing i don't know if you want to say a singular focus but something you're focused on and and start jumping into too many different things and that's what i i didn't want to do you know i kind of found my groove and i said hey this is being really successful let's get let's continue on this as long as we can so yeah there's definitely so many i mean there's you can go airbnb you can do vacation you know other vacation rentals you can flip homes but you found your niche and have been very successful so man congratulations i'm i'm so proud of you yeah i appreciate it man i i i love sharing the info i think it's um yeah it's just something that i i really think can can help change your life in in a positive way um and again it's just it's real estate isn't for everybody but um i think if you can get into it and and and find some good deals that you you'll find it can change things uh pretty significantly for you and and especially down the road you know All right, guys, well I know you got to get out of here. I got to go get my COVID shot, so I'm going to... congrats... call it a wrap, as well. But I appreciate it. Thanks,

everybody, for joining, and until next time:

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