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Speaker 1: Welcome to How to Money. I'm Joel and I am Matt,

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Speaker 1: and today we're talking real estate fire with Alan Corey.

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Speaker 2: That's right. Yeah, So any longtime listener of the podcast

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Speaker 2: knows that we're fans of investing in real estate. We

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Speaker 2: both have a handful of rentals and a decent bit

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Speaker 2: of our financial success is because of those properties, because

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Speaker 2: of those houses. But we also approach the conversation with

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Speaker 2: a degree of reservation because we don't think it's for everyone,

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Speaker 2: first of all, but also we got into the market

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Speaker 2: at a historically great period of time, and so we're

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Speaker 2: nuanced when we.

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Speaker 1: Talk about real estate.

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Speaker 2: But our guest today is not so here to preach

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Speaker 2: the real estate go is Alan Corey, who is all in.

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Speaker 2: He's a realtor, he's author of House Fire, which we'll

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Speaker 2: be discussing today, and of course he is an investor himself.

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Speaker 2: Alan is a self proclaimed real estate maximalist here in

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Speaker 2: our wonderful city of Atlanta, and we're going to talk

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Speaker 2: about all things real estate. I also heard that he

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Speaker 2: wanted to be a stand up comedian in a previous

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Speaker 2: slave show, so maybe we'll talk about that a little bit.

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Speaker 1: But Ali, we.

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Speaker 2: Really appreciate you joining us on the podcast today.

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Speaker 3: Glad to be here. You're right, real estate is not

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Speaker 3: for everyone. It's only for people who want to make

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Speaker 3: a lot of money.

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Speaker 1: There's the first is the stand up comedian. I can

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Speaker 1: tell Alan the first question we ask everyone who comes

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Speaker 1: on the show. Matt and I. We splurge a lot

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Speaker 1: on craft beer. Even while we're being intentional, we're saving

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Speaker 1: and investing for our futures. What's that for you? What

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Speaker 1: do you like to suplore? John?

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Speaker 4: You speak craft beer?

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Speaker 3: And then I turned forty, and then my gut was

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Speaker 3: telling me that I can't have I pas anymore.

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Speaker 4: And that time I got.

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Speaker 3: Really into flat caps, which are basically the hats that

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Speaker 3: Sherlock Holmes wears, and the only reason I've it. I'm

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Speaker 3: fighting every urge. But when you hit about forty five,

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Speaker 3: which is my age, now you start turning into your father.

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Speaker 4: And it's just.

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Speaker 3: Genetically predisposed that I'm going to wear these hats that

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Speaker 3: he wears. What my grandfather where and my great grandfather.

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Speaker 3: I don't know what it is. I just can't stop

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Speaker 3: buying them, and my wife is going crazy that our

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Speaker 3: closets getting filled with these caps.

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Speaker 4: I end up buying one a month.

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Speaker 1: For tweet and stuff. For that, I'm guessing.

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Speaker 3: You get the plaid, you get the tartan, you get

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Speaker 3: the tweed, you get the Saint Patrick's themed one, you

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Speaker 3: get the you know, there's a new holiday.

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Speaker 4: I need a new cap.

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Speaker 3: And you know, my wife's like, you look forty years

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Speaker 3: older when you wear that, and I know I do.

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Speaker 3: It's just I cannot stop myself. I don't know what's

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Speaker 3: going on.

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Speaker 2: So it's not like I thought the direction you're going

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Speaker 2: with it. I thought you were gonna start talking, You're

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Speaker 2: gonna mention hair loss or something.

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Speaker 1: Yeah, yeah, yeah, but.

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Speaker 2: You're saying that just truly it's in your DNA, not

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Speaker 2: that you're going to lose your hair, but that you

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Speaker 2: are turning into your father and your grandfather.

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Speaker 4: Yeah.

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Speaker 3: And my dad's really into you know, the ancestry and genealogy.

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Speaker 3: And we're from Ireland and Scotland and England, uh, you know,

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Speaker 3: but we've been in America as far as we can

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Speaker 3: trace it back for over two hundred years. I just

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Speaker 3: can't shake this this flat cap thing. And it's all

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Speaker 3: my ads.

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Speaker 4: On every social media.

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Speaker 3: They know that this is my weakness and that all

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Speaker 3: the ad I get, and I just keep buying them.

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Speaker 1: So I just hope you're sitting on the front porch

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Speaker 1: smoking a pipe on a rocking chair, also telling the

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Speaker 1: kids to get off your lone while you're wearing it.

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Speaker 3: Yes, then then I've I've metaphorphed into my dad and

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Speaker 3: cycle continues to my son.

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Speaker 2: I do feel like there's a way you could. You

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Speaker 2: could kind of change the script and what people expect.

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Speaker 2: Alan as long as you're not walking like clasping your

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Speaker 2: hands behind your back while you shuffle down the sidewalk,

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Speaker 2: because if you do that, I don't know, it reinforces

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Speaker 2: the character I have.

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Speaker 3: You know, perk. I have solved three crimes since this,

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Speaker 3: so you know it comes with some perks.

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Speaker 1: Matt would be happy to be your doctor, Watson, I'm

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Speaker 1: not gonna handle that.

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Speaker 2: So even though you're here in the city, we've ever

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Speaker 2: we've never actually met, we've never hung out. This is

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Speaker 2: truly the first time we've ever talked, and so we

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Speaker 2: would love for you to share a bit about your history,

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Speaker 2: like tell us about how you became a super saver,

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Speaker 2: like when you're first starting out, because if I understand

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Speaker 2: you were making something like forty K. You're living in

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Speaker 2: New York, but you were investing a massive chunk of that.

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Speaker 2: I'm assuming you weren't living large. So I want to

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Speaker 2: kind of hear the I guess the Alan Corey origin

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Speaker 2: story here.

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Speaker 4: Yeah. Sure.

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Speaker 3: So I moved to New York with dreams to be

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Speaker 3: a comedy writer. And so to be a comedy writer

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Speaker 3: you basically have to be a stand up comedian and

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Speaker 3: then hopefully you're funny enough that people hire you to

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Speaker 3: write some jokes for them.

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Speaker 2: So the next Liz Lemon, Yes.

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Speaker 4: Yes, exactly. And so because in my head, I was like.

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Speaker 3: Entertainers are rich, and I had no entertaining skills. I'm

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Speaker 3: not an actor or singer or dancer or anything like that.

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Speaker 3: But I was like, well, I was class clown in

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Speaker 3: high school. Maybe I can turn this into a lucrative

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Speaker 3: side gig or a full time gig. And so I

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Speaker 3: moved to New York City. I found a tech support job.

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Speaker 3: And this was the year two thousand. It was the

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Speaker 3: dot com boom and everything right right after that actually,

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Speaker 3: and and I was like, let's live the fire life,

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Speaker 3: the lean fire. This was before all that existed. But

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Speaker 3: the cheapest place I could find was an illegal sublet

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Speaker 3: in the Spanish Harlem project. So you know, I had

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Speaker 3: a roommate who lived in the projects and he gave

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Speaker 3: me his room for four hundred bucks a month, which

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Speaker 3: was great. And then I just started reducing my expenses everywhere.

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Speaker 3: I'd save on food by going to the bodega in

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Speaker 3: Spanish Harlem and buying ram noodles for thirteen cents each

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Speaker 3: if I bottom in bulk.

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Speaker 1: That's what I'm talking about.

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Speaker 4: Yeah, yeah, And.

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Speaker 3: Then I'd go to the bakery as they were closing

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Speaker 3: and about to throw off away all their fresh break

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Speaker 3: baked stuff for the day and get them at fifty

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Speaker 3: percent off or sometimes free. And I would just try

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Speaker 3: to cut all my expenses. And I even went to

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Speaker 3: my HR person and said, listen, I want you to

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Speaker 3: put fifty percent of my income or whatever my take

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Speaker 3: home pay into this bank account that I use every

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Speaker 3: single day, and the other fifty percent in this one

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Speaker 3: way across town that is really difficult for me to

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Speaker 3: get to. And this was pre online banking and all

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Speaker 3: that as well. I mean, I'm not that ancient, I'm

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Speaker 3: forty five, but you know, twenty years ago this was.

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Speaker 1: This was what were the horse and carriages like in

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Speaker 1: New York, exactly, exactly, Well, I pass.

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Speaker 2: Changed a lot in the past twenty twenty five years,

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Speaker 2: but no, I honestly, just to interrupt those for a second,

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Speaker 2: I love that you set that barrier between you and

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Speaker 2: your money to make it more difficult, because I assume

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Speaker 2: you're socking that money away and hopefully you were planning

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Speaker 2: to do something with it.

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Speaker 4: Right.

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Speaker 3: Yeah, Well, so everyone I felt like everyone in New

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Speaker 3: York was wealthy. Like you see the nice restaurants, you'd

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Speaker 3: occasionally see a celebrity, and you see people driving and

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Speaker 3: even taking cabs. I'm like, look at that rich person

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Speaker 3: who can take a cab? And so I was like,

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Speaker 3: how do they do it? And so I went to

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Speaker 3: the library because pre podcast, pre social media, pre YouTube,

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Speaker 3: all that stuff, and I just bought every book I

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Speaker 3: could on wealth building and stocks and everything. And what

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Speaker 3: I realized is with stocks, like I felt like I

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Speaker 3: was gambling it was like a thirty year horse race.

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Speaker 3: But real estate, I felt like I could control it

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Speaker 3: and that I could, you know, determine what I was

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Speaker 3: going to buy, how much I was going to buy

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Speaker 3: it for, how much was going to put to renovate it,

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Speaker 3: how much I could rent it for what my financing

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Speaker 3: terms are. I felt like I had a little bit

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Speaker 3: more control, a lot more control, actually, and so I

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Speaker 3: sort of reverse engineered that. You know, I was burning

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Speaker 3: the midnight oil going working my nine to five and

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Speaker 3: then I would go to the comedy club still three

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Speaker 3: o'clock in the morning. And it wasn't sustainable. It was

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Speaker 3: terrible at both my day job and at comedy. But

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Speaker 3: I was like, man, if I could just buy one

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Speaker 3: piece of property a year for five years, then I

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Speaker 3: could probably replace my day job income. And so that's

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Speaker 3: where I went to that bank account that was collecting

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Speaker 3: fifty percent of my take home bay every single year,

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Speaker 3: and I would just say, whatever's in that, that would

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Speaker 3: be my down payment.

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Speaker 4: For a property.

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Speaker 3: And every year I would say fifty percent and whatever's

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Speaker 3: in that, you know, let's apply it to That was

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Speaker 3: my get out of like corporate plan in five years.

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Speaker 3: So that first year I had ten thousand dollars saved up.

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Speaker 3: It was right after nine to eleven. Everyone's trying to

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Speaker 3: leave New York. You know, Alan, you're an idiot, You're

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Speaker 3: trying to buy a real estate. You know, everyone's so

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Speaker 3: fearful it's the worst time ever to ever buy a

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Speaker 3: real estate. You know, you don't know what you're doing.

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Speaker 3: And I found one property that I was one hundred

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Speaker 3: thousand dollars in Brooklyn. I had never been to Brooklyn before,

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Speaker 3: and I went to Brooklyn and homeless people were right

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Speaker 3: outside all this stuff that.

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Speaker 4: You see in movies.

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Speaker 3: And I was a naive kid from Georgia. But I

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Speaker 3: was like, I got to buy it. This is the

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Speaker 3: only property I can buy. It's a one bedroom apartment.

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Speaker 3: And you know, if things go bad bad into the projects,

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Speaker 3: like I'm already in the projects, like it can't get

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Speaker 3: any worse. I'm buying living in the projects whatever, right,

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Speaker 3: or I have tremendous upside if I can, if I

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Speaker 3: can make this work, like I thought it was going

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Speaker 3: to work. And what I did is I bought it

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Speaker 3: and it was a big living room and I was like,

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Speaker 3: I'm not going to have any people over. I don't

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Speaker 3: have any friends, so I.

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Speaker 4: Uh, I'm working big heavy. Yeah, exactly.

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Speaker 3: In New York, no one ever goes to your apartment.

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Speaker 3: You meet in a bar or a restaurant or everything.

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Speaker 4: Like you have no idea what.

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Speaker 3: People's lifestyle is because they all live in Jersey and

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Speaker 3: Brooklyn and Bronx or whatever. But I just took a big,

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Speaker 3: heavy curtain and sectioned off the living room and I

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Speaker 3: rented that out to a friend of mine, another comedian,

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Speaker 3: And that was like house hacking before else I existed.

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Speaker 3: And that would pay off my mortgage. Right, So I

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Speaker 3: went from paying four hundred bucks in the projects to

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Speaker 3: paying nothing and I own it, yes, And I was like, Okay,

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Speaker 3: there's something to this, right, And then the next year

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Speaker 3: I was able to save up fifteen thousand dollars on

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Speaker 3: January first, and so then I bought a duplex and

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Speaker 3: then I just you know, saved up some more money.

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Speaker 3: And my third property, I did a flip, and I

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Speaker 3: didn't have enough money, but I found the deal and

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Speaker 3: I found my next door neighbor was a contractor and

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Speaker 3: he would work for free for equity. And then the

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Speaker 3: only person that I thought was rich or knew was

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Speaker 3: I was dating a girl at her time at the time,

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Speaker 3: and her dad was a lawyer, and I was like, well, he.

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Speaker 4: Must be rich. He has a job in New York City.

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Speaker 3: He's a lawyer in New York, so he must be rich,

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Speaker 3: you know, I asked him if he would pay for

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Speaker 3: the down payment and you know, twenty percent down on

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Speaker 3: the renovations here on this deal that I found.

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Speaker 4: He said sure, and.

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Speaker 3: We bought this property in Red Hook, Brooklyn, which at

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Speaker 3: the time no one knew anything about, for four hundred

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Speaker 3: thousand dollars. We put two hundred thousand dollars into it,

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Speaker 3: and we sold it for one point one million dollars

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Speaker 3: a year later. I was twenty five years old at

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Speaker 3: that time, and the buyer was Barbara Corcoran from Shark

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Speaker 3: Took and that gave me the boost of confidence, like, wow, okay,

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Speaker 3: I found a deal, I renovated it, and Queen of

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Speaker 3: New York City Real Estate bought it for your own

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Speaker 3: personal investment. I'm doing things right. And I was like,

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Speaker 3: all right, I don't need to do comedymore. Let me

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Speaker 3: let me lean and do real estate there.

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Speaker 1: That's cool. Well, yeah, I love that combo of like

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Speaker 1: early sacrifices. There's I think there's a lot of stuff

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Speaker 1: that we can glean from that. The fact that you're

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Speaker 1: kind of divorcing yourself from that money until you're ready

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Speaker 1: to invest it. I love that. Yeah, siphoning it off

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Speaker 1: elsewhere so it's not a temptation for you, and I

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Speaker 1: want to talk a lot more about We want to

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Speaker 1: talk a lot more about investing on this episode. But

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Speaker 1: you're you're not just an investor, you're also an agent,

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Speaker 1: and so in spring is just the hottest time for

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Speaker 1: the housing market. What are you seeing right now? I'm

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Speaker 1: curious because there's a lot of a lot of our

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Speaker 1: listeners are interested in buying a house. Maybe they've put

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Speaker 1: it off because what's happened over the past couple of

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Speaker 1: years with rates and prices. Do you are you starting

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Speaker 1: to see things moderate, things chill out a little bit

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Speaker 1: in the housing market or yeah, I'm curious to hear

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Speaker 1: your perspective.

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Speaker 3: Yeah, so you're not going to like this or your

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Speaker 3: listeners are not going to like this, but it it's

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Speaker 3: hot and everything's a bidding more.

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Speaker 4: If you have a property that doesn't.

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Speaker 3: Need any work, it's going to go under contract with

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Speaker 3: multiple offers and there's not going to be comps that

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Speaker 3: support it. That the data just doesn't make sense. But

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Speaker 3: that's what's happening. Why is that happening? We have a

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Speaker 3: housing shortage. Has the housing shortage improved since last year? No,

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Speaker 3: the year before that, No, the year before that. No,

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Speaker 3: we are twenty years behind on building to match the

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Speaker 3: demand that makes prices go up regardless of the interest rates.

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Speaker 3: People want to wait, and they're going to wait. Oh,

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Speaker 3: let me save up twenty thousand dollars. You know, I

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Speaker 3: don't like the homes that I see right now. If

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Speaker 3: I save another twenty thousand dollars, I can go up

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Speaker 3: a price point. I can move my budget from five

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Speaker 3: hundred thousand to five hundred and fifty thousand dollars. It

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Speaker 3: doesn't work that way with inflation and the housing demand.

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Speaker 3: When you save up twenty thousand dollars, that house you

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Speaker 3: looked at five hundred thousand dollars is now five to fifty.

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Speaker 3: You're just buying the exact same house a year later

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Speaker 3: for more expensive price, And so you can't outsave inflation.

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Speaker 3: And you know, so you have money in your bank,

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Speaker 3: but inflation is eating away at that and you're trying

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Speaker 3: to outsave it. You're trying to outsave the rising housing market.

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Speaker 3: It's one of those things where it's never a good

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Speaker 3: time to buy real estate in that if you're waiting

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Speaker 3: for the perfect scenario of interest rates and price point

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Speaker 3: and what you get combined with it's always a good

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Speaker 3: time to buy real estate because tomorrow is always going

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Speaker 3: to be worse than it is today. You know, every

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Speaker 3: real estate investor, everyone who's ever bought a house, they're

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Speaker 3: always like, Wow, I'm glad I bought two years ago.

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Speaker 3: You know, ask them. You know, I've in real estate,

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Speaker 3: in real estate for twenty five years. Every single person's like, man,

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Speaker 3: I should have bought two year ago. I should have

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Speaker 3: bought two years ago. There's just not enough homes to buy,

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Speaker 3: and so it's it's tough, and so there's two ways

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Speaker 3: to look at real estate. Is whether you're looking as

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Speaker 3: an investment or a primary residence. But a primary it's

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Speaker 3: an emotional decision. Sometimes many times the numbers don't make

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Speaker 3: sense in terms of an investment, but you're buying for

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Speaker 3: life lifestyle. You want to be close to your work

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Speaker 3: or school district, or you just like the walkability or

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Speaker 3: close to the interstate, whatever it is.

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Speaker 4: That's fine.

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Speaker 3: You can pay extra and pay a premium for those

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Speaker 3: things because that's for your lifestyle and that brings you happiness.

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Speaker 3: But you can't always look at your primary resident is

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Speaker 3: going to be the best investment for you, and real

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Speaker 3: estate investors look at property differently. They look at it

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Speaker 3: as a spreadsheet decision, not an investment decision, and so

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Speaker 3: they might like the uglier house or the one that's

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Speaker 3: in the floodplain. And I always like to say, you

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Speaker 3: want to buy the you want your house to be

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Speaker 3: ugly in the street and sexy in the spreadsheets, and

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Speaker 3: so that's what makes a good investment. And typically the

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Speaker 3: opposite is true for primary where it's sexy in the

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Speaker 3: street but ugly in the spreadsheet.

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Speaker 2: Yeah, you wanted to have that curb appeal something that, Yeah,

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Speaker 2: your family is excited to come home too. But I mean,

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Speaker 2: I totally agree with what you're saying as far as

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Speaker 2: the overall trend of real estate. I mean, it's one

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Speaker 2: of those things that continues. It's almost like the stock

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Speaker 2: market in that way, like, yes, there are little fluctuations

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Speaker 2: here and there, but generally speaking it's up into the right.

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Speaker 2: But mortgage rates are crazy high compared to where they

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Speaker 2: were years ago, and they have a massive impact on

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Speaker 2: your monthly payment. It has a huge impact on individual's

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Speaker 2: ability to afford a home or not. And so I'm curious, like,

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Speaker 2: I know it depends on from market to market, but

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Speaker 2: how have you seen folks cope with that. And I'll

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Speaker 2: say where we are where we're not down in the

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Speaker 2: city and the small neighborhoods around central Atlanta like you are,

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Speaker 2: but we are seeing things slow down a good bit here.

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Speaker 2: There is not as much mobility because it seems like

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Speaker 2: a lot of folks are locked in. They've got folks

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Speaker 2: are hanging on to the three percent mortgages because they're

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Speaker 2: seeing what move into something at six and a half

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Speaker 2: and seven percent, what that's going to do to their payment.

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Speaker 3: Yeah, that's as adding to the housing shortage.

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Speaker 4: Right.

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Speaker 3: People don't want to sell because they have a three

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Speaker 3: percent mortgage, or if they do need to move because

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Speaker 3: of a birth in the family or a death, or

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Speaker 3: a marriage or a job transfer, they'll keep that as

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Speaker 3: a rent because the interest rates so low, and so

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Speaker 3: that adds to the housing shortage. But if you have

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Speaker 3: to move, right, you have to get into the school district,

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Speaker 3: you do get a job transfer, you got married, or

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Speaker 3: whatever it is you have to move, you have like

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Speaker 3: ten choices to choose from within your buybox, whether that's

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Speaker 3: your zip code and your price right, And so then

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Speaker 3: that's where these bidding wars go nuts, because you have

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Speaker 3: to move, you don't have a choice. A real estate

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Speaker 3: investor doesn't think that way. A real estate investor will

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Speaker 3: buy and get a thirty year fixed and hold it

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Speaker 3: until it's the right time to sell. For instance, I

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Speaker 3: invested all through the real estate the great financial crash,

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Speaker 3: and my property value went down fifty percent, but I

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Speaker 3: wasn't selling. And when people aren't buying homes, that actually

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Speaker 3: increases the rental demand. There's actually more renters because they're

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Speaker 3: not interested in buying homes because the lenders at the

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Speaker 3: banks aren't giving money or the interest rates are so high,

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Speaker 3: so there's actually more renters. And then even though my

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Speaker 3: property value went down, I'm not selling. I'm just waiting

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Speaker 3: and renting it out and collecting cash flow month to

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Speaker 3: month until it is a good time to sell back

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Speaker 3: when interest rates are low again or there's you know,

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Speaker 3: high demand, and I can sell it there's been a

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Speaker 3: lot of appreciation on my property, then I sell it.

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Speaker 3: So that's what's great about real estate investing is you

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Speaker 3: don't time the market. You just wait out the market

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Speaker 3: until you want to sell. And but primary investing is

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Speaker 3: you hear the horror stories and they make the headlines

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Speaker 3: because they're they're just time, you know, independent.

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Speaker 1: Yeah, yeah, that's a that's really important. Actually, I think

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Speaker 1: your history owning rental real estate through the Great Recession,

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Speaker 1: because yeah, you can write it out if if you

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Speaker 1: have a long long enough time rise, and then if

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Speaker 1: you have enough cash reserves. I want to know too, Like,

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Speaker 1: let's let's pivot, let's specifically talk about real estate investing,

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Speaker 1: Like what's your philosophy there? Do you you think of

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Speaker 1: it more like buying a small business? Right? And then

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Speaker 1: how do you how do you talk to people who

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Speaker 1: are like I'm interested, I'm curious about real estate investing,

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Speaker 1: but I'm just I'm not sure if it is for me.

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Speaker 1: Maybe I'm not. I'm not quite as gung ho as

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Speaker 1: you are. Alan, Maybe I should keep going with thein

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Speaker 1: k in the roth I rate kind of like Matt

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Speaker 1: and Joel talk about too. Why like what do you

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Speaker 1: tell folks when they're when they're kind of debating the two?

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Speaker 3: Yeah, So the number one way to get wealthy, like

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Speaker 3: really really wealthy is through leverage. Leverage is borrowing money

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Speaker 3: and making more money with that money. That's what a

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Speaker 3: mortgage does. You can't buy stocks with mortgage. It's very safe.

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Speaker 3: Every investment is a mix of you know, the risk

404
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Speaker 3: heer it is, the more money you make. But what's

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Speaker 3: great about real estate I think is actually safer than stocks,

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Speaker 3: and you make five times as much money as stocks.

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Speaker 4: So, for instance, let's say you.

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Speaker 3: Have one hundred thousand dollars and you buy one hundred

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Speaker 3: thousand dollars in stocks one company and it goes under,

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Speaker 3: you lose one hundred thousand dollars. You can also buy

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Speaker 3: one hundred thousand dollars of a house right by buy

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Speaker 3: one house for one hundred thousand dollars. It can be

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Speaker 3: out of state or whatnot. A property manager in a

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Speaker 3: rural town where homes may be more affordable than where

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Speaker 3: you live, and you're making one thousand dollars a month

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Speaker 3: an income, and then let's say you take that one

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Speaker 3: hundred thousand dollars, you rent it out for a thousand dollars,

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Speaker 3: and you know, let's assume after all expenses, you're taking

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Speaker 3: home one thousand dollars. Now, if that burns to the ground, okay,

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Speaker 3: well I could still sell the land, right the lot's

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Speaker 3: probably twenty thousand dollars. You can't do that with stocks.

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Speaker 3: So in some ways, you're a little bit protected. But

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Speaker 3: I like like to take a mutual fund approach to

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Speaker 3: real state. Similar to stocks. You wouldn't put one hundred

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Speaker 3: thousand dollars in stocks. You would probably spread it around

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Speaker 3: in mutual fund, which buys hundreds and a bunch of

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Speaker 3: different stocks. I do the same thing. Let me take

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Speaker 3: that one hundred thousand dollars and let me put it

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Speaker 3: is five different down payments on five different one hundred

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Speaker 3: thousand dollar homes twenty thousand year, twenty thousand year, twenty

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Speaker 3: twenty twenty. And now I have a mutual fund of houses.

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Speaker 3: So what's great about that is if one burns down

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Speaker 3: to the ground. You know, let's say after mortgage, I'm

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Speaker 3: making two hundred bucks, tw hundreducks, two undreducks to undred,

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Speaker 3: I'm still making a thousand bucks a month. One burns

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Speaker 3: to the ground. Oh well, I'm making eight hundred bucks

437
00:19:54,480 --> 00:19:54,800
Speaker 3: a month.

438
00:19:55,000 --> 00:19:57,479
Speaker 1: Right in that scenario. Let's hope you have insurance.

439
00:19:57,640 --> 00:19:58,679
Speaker 4: Yeah, yeah, yeah, you have insurance.

440
00:19:58,760 --> 00:20:00,000
Speaker 3: Yeah. If you have a mortgage, you have to have sure.

441
00:20:00,880 --> 00:20:03,800
Speaker 3: So let's maybe don't be so drastic. If I have

442
00:20:03,880 --> 00:20:09,240
Speaker 3: one house, let's say I raise the rent fifty bucks. Great,

443
00:20:09,359 --> 00:20:11,280
Speaker 3: I'm making a thousand and fifty bucks a month. But

444
00:20:11,320 --> 00:20:13,440
Speaker 3: if I have five houses and they're all exactly the same,

445
00:20:13,480 --> 00:20:16,600
Speaker 3: and I raise the rent fifty bucks over time because

446
00:20:16,640 --> 00:20:19,680
Speaker 3: of inflation or whatever, well now I'm making two hundred

447
00:20:19,680 --> 00:20:23,040
Speaker 3: and fifty bucks a month. I've scaled my wealth up right.

448
00:20:23,440 --> 00:20:26,280
Speaker 3: If I do nothing and I never raise rent and

449
00:20:26,760 --> 00:20:29,439
Speaker 3: just wait thirty years, if I have one house in

450
00:20:29,480 --> 00:20:31,359
Speaker 3: thirty years, maybe that one hundred thousand dollars house is

451
00:20:31,400 --> 00:20:34,239
Speaker 3: one hundred let's let's say one hundred and seventy five

452
00:20:34,280 --> 00:20:37,760
Speaker 3: thousand dollars house. But if I have five, I have

453
00:20:37,840 --> 00:20:39,720
Speaker 3: five houses that are paid off that are one hundred

454
00:20:39,760 --> 00:20:42,439
Speaker 3: and seventy five thousand. So that five x my wealth.

455
00:20:42,720 --> 00:20:45,080
Speaker 3: And if five x is my rental income, if I

456
00:20:45,119 --> 00:20:47,800
Speaker 3: raise rent twenty five thousand, if one goes down, if

457
00:20:47,800 --> 00:20:50,240
Speaker 3: one is vacant, maybe doesn't burn to the ground, I

458
00:20:50,280 --> 00:20:54,640
Speaker 3: just can't rent it or whatnot, then the other four

459
00:20:54,920 --> 00:20:57,760
Speaker 3: booie it like like a mutual fund. And then I say,

460
00:20:57,800 --> 00:21:00,920
Speaker 3: every house comes with a lottery ticket, hidden lottery ticket.

461
00:21:01,520 --> 00:21:04,720
Speaker 3: I was investing in Brooklyn and different neighbors in Brooklyn,

462
00:21:04,960 --> 00:21:06,520
Speaker 3: and all of a sudden, Brooklyn blew up and became

463
00:21:06,560 --> 00:21:09,440
Speaker 3: the next hot neighborhood, not because of anything I was doing,

464
00:21:09,480 --> 00:21:11,920
Speaker 3: not because i'd need foresight or I was smarter trying

465
00:21:11,960 --> 00:21:14,240
Speaker 3: to time the market. But if I had one property

466
00:21:14,240 --> 00:21:16,280
Speaker 3: and I kept trying to pay off that mortgage and

467
00:21:16,359 --> 00:21:19,840
Speaker 3: I wasn't trying to scale and leverage and buy more properties,

468
00:21:19,880 --> 00:21:21,720
Speaker 3: I wouldn't have gotten quote unquote lucky.

469
00:21:22,000 --> 00:21:23,959
Speaker 4: And so there's all these things that sort of happened.

470
00:21:24,040 --> 00:21:27,399
Speaker 3: If you borrow money and you put it to go

471
00:21:27,480 --> 00:21:30,720
Speaker 3: make more money, and the more properties you buy, the

472
00:21:30,920 --> 00:21:33,399
Speaker 3: less risky it is, and the luckier get and the

473
00:21:33,400 --> 00:21:34,320
Speaker 3: more money you're gonna make.

474
00:21:34,560 --> 00:21:34,919
Speaker 1: Sure.

475
00:21:35,040 --> 00:21:37,879
Speaker 2: So yeah, the mechanics behind it certainly makes sense. But

476
00:21:38,080 --> 00:21:40,080
Speaker 2: do you think that this is something that everyone out

477
00:21:40,119 --> 00:21:43,880
Speaker 2: there should consider, Like should everyone out their own rental

478
00:21:43,920 --> 00:21:47,080
Speaker 2: real estate? Because it's when you are just looking at

479
00:21:47,119 --> 00:21:49,119
Speaker 2: the numbers, you're like, oh, man, who wouldn't do that

480
00:21:49,400 --> 00:21:52,280
Speaker 2: with say it was a spare twenty thousand dollars, which

481
00:21:52,280 --> 00:21:53,840
Speaker 2: I'm not sure I everyone has to spare twenty thousand

482
00:21:53,840 --> 00:21:54,960
Speaker 2: dollars sitting around, but even.

483
00:21:54,880 --> 00:21:56,720
Speaker 1: And I'm not sure houses cost one hundred thousand dollars.

484
00:21:57,040 --> 00:21:59,479
Speaker 2: But so I guess with all that in mind, like

485
00:21:59,560 --> 00:22:02,800
Speaker 2: there's a an element of time that's required to manage

486
00:22:02,840 --> 00:22:05,240
Speaker 2: these as well. It's got like a part time job

487
00:22:05,320 --> 00:22:08,200
Speaker 2: element to it. It's not nearly as passive as a

488
00:22:08,240 --> 00:22:10,960
Speaker 2: lot of real estate influencers want to make it sound.

489
00:22:11,200 --> 00:22:16,000
Speaker 2: And whether it's managing renovations, showing the property, screening tenants.

490
00:22:16,840 --> 00:22:18,959
Speaker 2: I guess what would you say to somebody who is

491
00:22:19,080 --> 00:22:20,960
Speaker 2: assuming that it's going to be a set it and

492
00:22:21,000 --> 00:22:22,160
Speaker 2: forget it kind of deal.

493
00:22:22,320 --> 00:22:24,840
Speaker 3: It wasn't ever a setate forget it until you get

494
00:22:24,840 --> 00:22:25,840
Speaker 3: to a certain scale.

495
00:22:25,920 --> 00:22:27,720
Speaker 4: And when you have, you know, you can.

496
00:22:27,640 --> 00:22:30,240
Speaker 3: Get property managers. You can find one hundred thousand dollar properties.

497
00:22:30,320 --> 00:22:33,240
Speaker 3: I mean, as of four years ago, I was buying

498
00:22:33,240 --> 00:22:35,359
Speaker 3: properties for thirty thousand dollars just an hour south of

499
00:22:35,359 --> 00:22:38,639
Speaker 3: Atlanta in a town called Griffin, Georgia, and I recently

500
00:22:38,640 --> 00:22:42,200
Speaker 3: sold them all for sixty thousand dollars each two years ago,

501
00:22:42,240 --> 00:22:44,360
Speaker 3: and they're probably eighty one hundred thousand dollars now.

502
00:22:44,880 --> 00:22:45,879
Speaker 4: So they exist.

503
00:22:45,960 --> 00:22:47,800
Speaker 3: They just might exist in your hometown and you're not

504
00:22:47,840 --> 00:22:50,480
Speaker 3: looking for them, so you don't really see them because

505
00:22:50,480 --> 00:22:55,920
Speaker 3: they're not in your neighborhood. But what I would say is, yes,

506
00:22:56,040 --> 00:22:57,720
Speaker 3: it's going to take a little bit of work. It's

507
00:22:57,840 --> 00:23:01,720
Speaker 3: leveraged work. Going to have to leverage and build the connections,

508
00:23:01,760 --> 00:23:04,200
Speaker 3: build a network. I always say, find a rock star

509
00:23:04,560 --> 00:23:06,159
Speaker 3: in the town you want to invest in, whether that's

510
00:23:06,160 --> 00:23:08,800
Speaker 3: a rockstar agent or rockstar property manager, a rockstar lender,

511
00:23:09,040 --> 00:23:10,840
Speaker 3: because rock stars hang out with other rock stars, and

512
00:23:10,880 --> 00:23:13,560
Speaker 3: you just leverage their network and say, hey, I want

513
00:23:13,600 --> 00:23:15,720
Speaker 3: to invest in real estate in this town. You're a

514
00:23:15,800 --> 00:23:17,520
Speaker 3: rockstar in this town, can you help connect me and

515
00:23:17,560 --> 00:23:20,840
Speaker 3: to the other players, and you can just leverage their network.

516
00:23:21,240 --> 00:23:23,320
Speaker 3: It's much easier to do it that way. But if

517
00:23:23,359 --> 00:23:26,359
Speaker 3: you have twenty thousand dollars. This is my sort of

518
00:23:26,680 --> 00:23:29,560
Speaker 3: approach to my book House Fire, where it's should you

519
00:23:29,560 --> 00:23:31,760
Speaker 3: ask me and should everyone do this? And it's like, well,

520
00:23:31,800 --> 00:23:33,639
Speaker 3: if you like math, you should do it. If you

521
00:23:33,680 --> 00:23:37,800
Speaker 3: trust math, you should do it. Because I look at

522
00:23:37,800 --> 00:23:40,840
Speaker 3: my internet bill and my internet phone bill combined is

523
00:23:40,840 --> 00:23:43,399
Speaker 3: one hundred and fifty bucks a month. And if I

524
00:23:43,440 --> 00:23:47,520
Speaker 3: follow typical fire movement, which is fire, you know, financial independence,

525
00:23:47,560 --> 00:23:49,200
Speaker 3: retire early. I know you've talked about this plenty of

526
00:23:49,240 --> 00:23:52,600
Speaker 3: times of your podcast. It says it takes twenty five

527
00:23:52,640 --> 00:23:54,879
Speaker 3: times or your annual expenses of that bill and as

528
00:23:54,920 --> 00:23:56,960
Speaker 3: long as you have that in stocks, and you withdraw

529
00:23:57,080 --> 00:24:01,200
Speaker 3: four percent each year, then you've got that. And so

530
00:24:01,359 --> 00:24:03,520
Speaker 3: that would be let's see, one hundred and fifty dollars

531
00:24:03,520 --> 00:24:06,360
Speaker 3: bill would be eighteen hundred dollars a year, forty five

532
00:24:06,359 --> 00:24:08,720
Speaker 3: thousand dollars in stocks. As long as I have forty

533
00:24:08,720 --> 00:24:11,600
Speaker 3: five thousand dollars in stocks, I can pull out four

534
00:24:11,640 --> 00:24:13,320
Speaker 3: percent of that, which is one hundred and fifty bucks

535
00:24:13,320 --> 00:24:16,560
Speaker 3: a month, and that internet bill's paid for my life.

536
00:24:16,600 --> 00:24:18,879
Speaker 3: That sounds crazy to me, Like, yeah, of course, if

537
00:24:18,920 --> 00:24:20,000
Speaker 3: I do that for every bill in my life, I

538
00:24:20,080 --> 00:24:23,160
Speaker 3: have to be a millionaire. And that just seems too ambitious.

539
00:24:23,200 --> 00:24:27,160
Speaker 3: I will never get there, and that then I'm living

540
00:24:27,160 --> 00:24:29,800
Speaker 3: on a constrained retirement. So instead, I was like, how

541
00:24:29,800 --> 00:24:31,760
Speaker 3: can I apply this to real estate, this fire method,

542
00:24:31,960 --> 00:24:34,879
Speaker 3: because I'm not doing that. I'm done living below my means.

543
00:24:34,920 --> 00:24:36,760
Speaker 3: I did that in my early twenties. I'm not going

544
00:24:36,800 --> 00:24:39,960
Speaker 3: to do that anymore. When what I just what I

545
00:24:40,000 --> 00:24:42,439
Speaker 3: took was half of that, so forty four forty five

546
00:24:42,440 --> 00:24:44,720
Speaker 3: thousand dollars, half of that's twenty two thousand, five hundred dollars.

547
00:24:45,000 --> 00:24:47,680
Speaker 3: I went and bought these hundred thousand dollars properties fewer

548
00:24:47,680 --> 00:24:49,960
Speaker 3: than one hundred thousand dollar pperties. I built up a

549
00:24:50,000 --> 00:24:53,240
Speaker 3: portfolio of fifty single family homes, all under one hundred

550
00:24:53,240 --> 00:24:56,440
Speaker 3: thousand dollars. And what I realized is if I put

551
00:24:56,480 --> 00:25:00,080
Speaker 3: down twenty percent on one hundred thousand dollars property, and

552
00:25:00,080 --> 00:25:02,440
Speaker 3: then there was two thousand, five hundred dollars of closing costs,

553
00:25:02,640 --> 00:25:04,600
Speaker 3: that was my twenty two thousand, five hundred dollars. I

554
00:25:04,600 --> 00:25:10,120
Speaker 3: could cash flow after expenses, property manager vacancies, capex repairs

555
00:25:10,160 --> 00:25:11,600
Speaker 3: like a big roof, and things like that, I could

556
00:25:11,640 --> 00:25:13,080
Speaker 3: cash flow one hundred and fifty bucks.

557
00:25:13,400 --> 00:25:16,480
Speaker 4: So all of a sudden, I have right away.

558
00:25:16,560 --> 00:25:18,240
Speaker 3: I don't have to wait until I save forty five

559
00:25:18,240 --> 00:25:21,520
Speaker 3: thousand dollars and withdraw four percent. I took twenty two thousand,

560
00:25:21,520 --> 00:25:23,119
Speaker 3: five hundred dollars, put it in the market, and it

561
00:25:23,160 --> 00:25:25,320
Speaker 3: would kick off one hundred fifty dollars to pay my

562
00:25:25,400 --> 00:25:27,679
Speaker 3: internet phone bill. And I was like, Aha, that's my

563
00:25:27,720 --> 00:25:29,760
Speaker 3: AHA moment. And so then I went down to my

564
00:25:29,800 --> 00:25:32,560
Speaker 3: next bill. Wow, if I collect all my utility bills,

565
00:25:32,600 --> 00:25:35,800
Speaker 3: my gas and electric, you know, that's probably one hundred

566
00:25:35,800 --> 00:25:37,960
Speaker 3: and fifty bucks there. Okay, I just need to save

567
00:25:38,000 --> 00:25:40,600
Speaker 3: another twenty two thousand, five hundred dollars and then that's

568
00:25:40,600 --> 00:25:42,280
Speaker 3: going to pay off my bill. And then I just

569
00:25:42,320 --> 00:25:46,120
Speaker 3: started matching my houses for each bill, and then that's

570
00:25:46,160 --> 00:25:48,760
Speaker 3: my house fire method, and I would just this house

571
00:25:48,800 --> 00:25:50,720
Speaker 3: for that bill, that bill, that bill, and that is

572
00:25:50,760 --> 00:25:54,119
Speaker 3: my retirement plan. And what was great now is that

573
00:25:54,280 --> 00:25:57,480
Speaker 3: I live larger and larger each year in my retirement.

574
00:25:57,800 --> 00:26:00,760
Speaker 3: Because rent goes up, you charge a little bit more

575
00:26:00,760 --> 00:26:03,320
Speaker 3: in rent, my mortgage payments go down a little bit.

576
00:26:03,359 --> 00:26:06,920
Speaker 3: I still get great tax breaks, and the properties are

577
00:26:07,520 --> 00:26:11,200
Speaker 3: appreciating more and more. So I'm not pulling four percent

578
00:26:11,200 --> 00:26:14,359
Speaker 3: from my stock, keeping that at a artificially low level,

579
00:26:14,600 --> 00:26:17,960
Speaker 3: because as you withdraw money from your stocks, you can't

580
00:26:17,960 --> 00:26:20,080
Speaker 3: appreciate as much. I'm not pulling any money for my

581
00:26:20,080 --> 00:26:22,400
Speaker 3: real estate except for the cash flow. And so this

582
00:26:22,480 --> 00:26:25,120
Speaker 3: is the retirement plan that took half the time, half

583
00:26:25,119 --> 00:26:27,000
Speaker 3: the money, and I get to live larger and larger

584
00:26:27,040 --> 00:26:29,080
Speaker 3: each time in retirement. It just makes sense to me.

585
00:26:29,160 --> 00:26:31,159
Speaker 3: So yes, I think everyone should do it if you

586
00:26:31,200 --> 00:26:33,040
Speaker 3: like math, if you're willing to put some upfront work.

587
00:26:33,200 --> 00:26:36,320
Speaker 3: It really only takes five properties over five years, and

588
00:26:36,359 --> 00:26:38,359
Speaker 3: that's better than working at your day job for another

589
00:26:38,400 --> 00:26:40,119
Speaker 3: fifteen twenty years to retire.

590
00:26:40,200 --> 00:26:42,560
Speaker 1: I love how well you said you have to like math.

591
00:26:42,560 --> 00:26:44,000
Speaker 1: Then you really wait a second, No, no, you have to

592
00:26:44,000 --> 00:26:45,800
Speaker 1: trust mathing because I don't really like math, but I

593
00:26:45,800 --> 00:26:48,919
Speaker 1: trust math, and so there's a difference there for me,

594
00:26:48,960 --> 00:26:50,159
Speaker 1: and I think maybe for a lot of people out

595
00:26:50,160 --> 00:26:53,040
Speaker 1: there who are like, yeah, now, algebra wasn't really my thing,

596
00:26:53,080 --> 00:26:54,840
Speaker 1: but I trust the math. I trust the way some

597
00:26:54,880 --> 00:26:57,080
Speaker 1: of the basic numbers work, and so I too can

598
00:26:57,119 --> 00:26:59,280
Speaker 1: get behind the idea of investing in real estate. But

599
00:26:59,320 --> 00:27:01,840
Speaker 1: we've got more questions to get to you with you, Alan,

600
00:27:01,880 --> 00:27:04,680
Speaker 1: specifically about your house fire method, how it works. There's

601
00:27:04,680 --> 00:27:06,680
Speaker 1: a lot of details we want to unearth. We'll get

602
00:27:06,720 --> 00:27:08,320
Speaker 1: to those questions right after this.

603
00:27:16,119 --> 00:27:18,080
Speaker 2: All right, we are back from the break talking with

604
00:27:18,240 --> 00:27:22,119
Speaker 2: Alan Corey about investing in real estate, specifically real estate fire,

605
00:27:22,720 --> 00:27:26,840
Speaker 2: achieving a sense of financial independence via real estate. And

606
00:27:26,880 --> 00:27:28,800
Speaker 2: now I'm having a hard time, I guess, getting past

607
00:27:28,840 --> 00:27:32,920
Speaker 2: the just where mortgage interest rates are right now, and

608
00:27:33,040 --> 00:27:35,000
Speaker 2: given the fact that they are higher and that most

609
00:27:35,000 --> 00:27:38,119
Speaker 2: folks are likely looking to the banks in order to

610
00:27:38,280 --> 00:27:41,320
Speaker 2: finance their properties, how are you approaching that, I guess,

611
00:27:41,440 --> 00:27:44,600
Speaker 2: because obviously, when you're paying three and a half percent.

612
00:27:44,960 --> 00:27:47,680
Speaker 2: Your numbers look one way, but better you're paying six

613
00:27:47,720 --> 00:27:49,119
Speaker 2: and a half to seven and a half percent on

614
00:27:49,160 --> 00:27:51,920
Speaker 2: an investment property, it's going to have an impact on

615
00:27:51,960 --> 00:27:54,720
Speaker 2: the numbers. You know you're mentioning the math right before

616
00:27:54,720 --> 00:27:57,520
Speaker 2: the break, talk to us about the math behind where

617
00:27:57,600 --> 00:28:01,560
Speaker 2: rates are right now, and specifically from an investor's standpoint.

618
00:28:01,600 --> 00:28:04,440
Speaker 3: So, as an investor, I completely don't care about interest rates.

619
00:28:06,160 --> 00:28:08,520
Speaker 3: Let me explain that, because you're gonna be scratching your head.

620
00:28:08,960 --> 00:28:09,720
Speaker 4: Here's what matter.

621
00:28:09,840 --> 00:28:16,119
Speaker 3: I've found great real estate deals that would be great

622
00:28:16,560 --> 00:28:19,200
Speaker 3: to even good with twenty percent interest rates. I found

623
00:28:19,280 --> 00:28:21,800
Speaker 3: terrible real estate deals that would be terrible even with

624
00:28:21,920 --> 00:28:24,880
Speaker 3: zero percent interest rates. It's just a variable. You plug

625
00:28:24,880 --> 00:28:27,760
Speaker 3: it into a formula. It's a variable. It doesn't it doesn't.

626
00:28:27,800 --> 00:28:29,919
Speaker 3: It's just like the purchase price. I look at it

627
00:28:29,920 --> 00:28:33,080
Speaker 3: this way. If with today's rates, let's say it's a

628
00:28:33,119 --> 00:28:35,400
Speaker 3: seven percent eight percent, or if I'm doing hard money,

629
00:28:35,440 --> 00:28:36,960
Speaker 3: I got to do ten fifteen percent.

630
00:28:37,040 --> 00:28:37,679
Speaker 4: Whatever it is.

631
00:28:38,240 --> 00:28:40,640
Speaker 3: You put in your spreadsheet and you look at the numbers,

632
00:28:40,760 --> 00:28:44,000
Speaker 3: and if it's cash flowing, this is I've got three

633
00:28:44,200 --> 00:28:46,640
Speaker 3: things that are going to happen, Like I only get

634
00:28:46,760 --> 00:28:51,680
Speaker 3: fixed debt. You won't get in trouble with fixed rate debt,

635
00:28:51,720 --> 00:28:55,320
Speaker 3: meaning thirty years fixed. And every time there's a crash

636
00:28:55,480 --> 00:28:58,040
Speaker 3: the commercial people right now offices, it's because they have

637
00:28:58,080 --> 00:29:00,680
Speaker 3: adjustable rate mortgages back in the actually two thousand and

638
00:29:00,680 --> 00:29:02,720
Speaker 3: eight is because of adjustable rate mortgages. If you have

639
00:29:02,760 --> 00:29:06,960
Speaker 3: thirty year fixes, your golden and you you'll just get

640
00:29:07,080 --> 00:29:11,440
Speaker 3: rich by longevity. And so the three things that are

641
00:29:11,440 --> 00:29:14,240
Speaker 3: going to happen are this, I lock in a ten

642
00:29:14,240 --> 00:29:17,560
Speaker 3: percent interest rate. In ten years, twenty years, thirty years,

643
00:29:17,600 --> 00:29:20,240
Speaker 3: interest rates stay the same and it never moves off

644
00:29:20,240 --> 00:29:24,320
Speaker 3: ten percent. That's fine. I'm still cash flowing. I'm making

645
00:29:24,360 --> 00:29:26,680
Speaker 3: money each month. This is a little ATM machine for me.

646
00:29:27,040 --> 00:29:29,880
Speaker 3: So I'm glad I bought and that I didn't wait

647
00:29:29,880 --> 00:29:33,720
Speaker 3: for interest rates to change or interest rates go up.

648
00:29:34,160 --> 00:29:36,400
Speaker 3: And you know, the day after I close, interest rates

649
00:29:36,440 --> 00:29:38,920
Speaker 3: go up to twelve percent and forever and they never

650
00:29:39,000 --> 00:29:42,000
Speaker 3: go back down to ten percent. Well, that's fine, I've

651
00:29:42,040 --> 00:29:45,320
Speaker 3: locked into ten percent. I'm glad I bought. Third thing,

652
00:29:45,400 --> 00:29:48,280
Speaker 3: interest rates go down, Well, I'm making money right now.

653
00:29:48,320 --> 00:29:50,480
Speaker 3: If interest rates go down to eight or seven, then

654
00:29:50,520 --> 00:29:54,880
Speaker 3: I refinance. I'm glad I bought. So that's how real

655
00:29:54,920 --> 00:29:57,160
Speaker 3: say investors look at it is they're not going to

656
00:29:57,240 --> 00:29:59,400
Speaker 3: make They're not going to buy anything that's not making

657
00:29:59,400 --> 00:30:02,600
Speaker 3: money into day's environment, in today's prices and today's interest rates.

658
00:30:02,920 --> 00:30:06,920
Speaker 3: But if you buy a residential property which is four

659
00:30:07,000 --> 00:30:10,240
Speaker 3: units or fewer with a thirty year fixed loan, you

660
00:30:10,400 --> 00:30:11,760
Speaker 3: and you can find a way to cash flow it

661
00:30:11,800 --> 00:30:15,360
Speaker 3: today with the numbers. I don't care about interest rates.

662
00:30:15,360 --> 00:30:18,360
Speaker 3: I can either stay locked in or I refinance if

663
00:30:18,400 --> 00:30:20,640
Speaker 3: they get better. Like I'm just glad I bought because

664
00:30:20,640 --> 00:30:23,440
Speaker 3: I'm trying to buy a property to pay my bills

665
00:30:23,680 --> 00:30:26,000
Speaker 3: that one hundred and fifty dollars here, two hundred bucks here,

666
00:30:26,160 --> 00:30:27,760
Speaker 3: trying to buy the car, pay off my car note,

667
00:30:27,760 --> 00:30:30,160
Speaker 3: my student loan debt. That's what I'm using my real

668
00:30:30,240 --> 00:30:32,240
Speaker 3: estate for. I'm not trying to flip it. I'm not

669
00:30:32,240 --> 00:30:34,560
Speaker 3: trying to sell it. So that's why I say that's

670
00:30:34,680 --> 00:30:36,160
Speaker 3: irrelevant what the interest rates are.

671
00:30:36,240 --> 00:30:38,040
Speaker 1: Okay, talk to me about how you determine what's a

672
00:30:38,080 --> 00:30:40,280
Speaker 1: good deal and what's worth investing in, because it can't

673
00:30:40,400 --> 00:30:42,680
Speaker 1: just be oh, it's cash flowing two bucks a month,

674
00:30:42,720 --> 00:30:44,360
Speaker 1: because then you're like, eeah, it's not worth my time right.

675
00:30:44,600 --> 00:30:48,160
Speaker 1: So like your philosophy is always be buying, but you

676
00:30:48,600 --> 00:30:50,480
Speaker 1: also you don't seem to put as much emphasis on

677
00:30:50,520 --> 00:30:53,960
Speaker 1: finding the property with the absolute best returns. And my

678
00:30:54,000 --> 00:30:58,080
Speaker 1: thought is fewer better properties maybe means less hassle with

679
00:30:58,240 --> 00:31:00,280
Speaker 1: the same amount of income. But I'm curious to hear

680
00:31:00,280 --> 00:31:00,920
Speaker 1: your philosophy.

681
00:31:01,240 --> 00:31:05,960
Speaker 3: Yeah, this is where everyone freezes analysis paralysis. They they'll

682
00:31:06,040 --> 00:31:08,360
Speaker 3: create their bybox. You have to create a bybox because

683
00:31:08,560 --> 00:31:10,920
Speaker 3: what happens is someone's going to say, well, I found

684
00:31:10,920 --> 00:31:15,360
Speaker 3: this airbnb in Florida, I found this duplex in my hometown,

685
00:31:15,680 --> 00:31:18,600
Speaker 3: and then I've found this single family home in my neighborhood,

686
00:31:18,880 --> 00:31:21,400
Speaker 3: and they'll come to me and say which one should

687
00:31:21,440 --> 00:31:24,120
Speaker 3: I BUYO. I'll typically say, well, if you found the

688
00:31:24,120 --> 00:31:26,440
Speaker 3: best duplex in your in your old hometown, and you

689
00:31:26,480 --> 00:31:29,000
Speaker 3: found the best single family and you bought the best

690
00:31:29,080 --> 00:31:31,280
Speaker 3: you know, short term rental because you've been looking.

691
00:31:31,040 --> 00:31:33,960
Speaker 4: There, then buy them all. You can't really.

692
00:31:34,040 --> 00:31:37,320
Speaker 3: Compare and contrast. And what I say is you don't

693
00:31:37,360 --> 00:31:39,920
Speaker 3: have a buy box that's strict enough. It's much easier

694
00:31:39,960 --> 00:31:42,880
Speaker 3: to narrow that bybox and only look at the duplexes

695
00:31:42,920 --> 00:31:44,200
Speaker 3: from your own old hometown.

696
00:31:44,400 --> 00:31:45,400
Speaker 4: Why is that, because.

697
00:31:45,160 --> 00:31:47,640
Speaker 3: Then you could become an expert and you're gonna get

698
00:31:47,640 --> 00:31:50,880
Speaker 3: the word out there that hey, Alan buys duplexes in

699
00:31:50,920 --> 00:31:53,680
Speaker 3: his own hotown, and then everyone knows to call you

700
00:31:53,720 --> 00:31:56,120
Speaker 3: if there's a duplex and you just buy duplex, duplex,

701
00:31:56,200 --> 00:31:58,000
Speaker 3: and all of a sudden, you are a market expert.

702
00:31:58,080 --> 00:31:59,760
Speaker 3: You know what a duplex rents for, how much is

703
00:31:59,800 --> 00:32:01,960
Speaker 3: cost to renovate, what the property texes are going to be,

704
00:32:02,120 --> 00:32:05,440
Speaker 3: the insurance. And so if you sort of concentrate and

705
00:32:05,480 --> 00:32:08,480
Speaker 3: become an expert in one niche, rather than trying to

706
00:32:08,520 --> 00:32:11,200
Speaker 3: diversify off the gate, you were going to go much

707
00:32:11,400 --> 00:32:13,200
Speaker 3: further and you're gonna learn more.

708
00:32:13,200 --> 00:32:15,360
Speaker 1: And that's exactly what you did with quadplexies, right like

709
00:32:15,400 --> 00:32:16,320
Speaker 1: you were the quadplex guy.

710
00:32:16,360 --> 00:32:20,400
Speaker 3: Yeah, I'd learned this. There wasn't any foresight. I just

711
00:32:20,480 --> 00:32:22,400
Speaker 3: bought one and then I bought another one, and then

712
00:32:22,400 --> 00:32:24,520
Speaker 3: the neighbors come and like, hey, you bought two in

713
00:32:24,560 --> 00:32:26,040
Speaker 3: the street, you want to buy this one, And all

714
00:32:26,080 --> 00:32:27,960
Speaker 3: of a sudden, I became the duplex guy. It's just

715
00:32:28,200 --> 00:32:32,440
Speaker 3: your reputation becomes a lead magnet and I become an expert. Obviously,

716
00:32:32,520 --> 00:32:35,240
Speaker 3: I'm not going to make a ton that first I'm

717
00:32:35,280 --> 00:32:37,120
Speaker 3: gonna learn a lot of lessons on that first one,

718
00:32:37,400 --> 00:32:38,880
Speaker 3: but then then I can apply it to the second

719
00:32:38,880 --> 00:32:40,600
Speaker 3: one and third one, and then you become an expert

720
00:32:40,680 --> 00:32:44,240
Speaker 3: in that niche So if you want to hone the

721
00:32:44,280 --> 00:32:47,200
Speaker 3: skill set without buying anything. I realized I was doing

722
00:32:47,240 --> 00:32:49,080
Speaker 3: this when I lived in Brooklyn. I went to every

723
00:32:49,120 --> 00:32:51,680
Speaker 3: single open house on my block, and I would just

724
00:32:51,760 --> 00:32:54,040
Speaker 3: track every sale on my block, and then I would

725
00:32:54,040 --> 00:32:56,320
Speaker 3: predict what I think it would sell for and whatnot.

726
00:32:56,600 --> 00:32:58,400
Speaker 3: And then I would predict what I think it should

727
00:32:58,440 --> 00:33:01,760
Speaker 3: list for. And I tracked my block and once I

728
00:33:01,840 --> 00:33:04,480
Speaker 3: sort of was like within five percent of getting it.

729
00:33:04,480 --> 00:33:05,400
Speaker 4: Right every single time.

730
00:33:05,640 --> 00:33:07,680
Speaker 3: Then I went to my street, and then I went

731
00:33:07,720 --> 00:33:09,480
Speaker 3: to my zip code, and then I went to the

732
00:33:09,480 --> 00:33:12,040
Speaker 3: school district or whatever. You just widen it, and I

733
00:33:12,160 --> 00:33:14,920
Speaker 3: just started tracking numbers and data. It's fun for me.

734
00:33:14,960 --> 00:33:16,680
Speaker 3: And I was just looking at it on Zillo like

735
00:33:16,680 --> 00:33:17,560
Speaker 3: everyone looks at Zillo.

736
00:33:18,000 --> 00:33:18,640
Speaker 4: I hate math.

737
00:33:18,840 --> 00:33:20,920
Speaker 3: I'm not a big math guy, but real estate math

738
00:33:21,000 --> 00:33:24,280
Speaker 3: is just addition and subtraction. It's not anything to you know,

739
00:33:24,800 --> 00:33:26,960
Speaker 3: you don't have to have a degree in. It's great

740
00:33:27,320 --> 00:33:29,600
Speaker 3: if you have a passion and you can hear my passion.

741
00:33:29,760 --> 00:33:32,120
Speaker 3: People call me after this podcast, Alan, let's buy real

742
00:33:32,200 --> 00:33:32,680
Speaker 3: estate together?

743
00:33:32,880 --> 00:33:33,520
Speaker 4: Can you help me?

744
00:33:33,600 --> 00:33:35,120
Speaker 3: Like, you just got to get your word out and

745
00:33:35,120 --> 00:33:37,600
Speaker 3: share your passion and it'll change your life.

746
00:33:37,800 --> 00:33:39,560
Speaker 1: I like what you were talking about there with kind

747
00:33:39,600 --> 00:33:41,800
Speaker 1: of zeroing down into street level, and that's kind of

748
00:33:41,840 --> 00:33:43,720
Speaker 1: where I started to It's like investing all inside of

749
00:33:43,720 --> 00:33:45,160
Speaker 1: a neighborhood. And then I was like, wait a second,

750
00:33:45,160 --> 00:33:46,560
Speaker 1: I can invest in the neighborhood over and maybe the

751
00:33:46,600 --> 00:33:48,480
Speaker 1: neighborhood over from that, But it was all kind of

752
00:33:48,480 --> 00:33:52,320
Speaker 1: within this limited sphere, all within kind of driving distance

753
00:33:52,400 --> 00:33:55,479
Speaker 1: and my ability to thoroughly understand the market. You've now

754
00:33:55,520 --> 00:33:57,520
Speaker 1: invested in a bunch of different markets. You've invested in

755
00:33:57,600 --> 00:33:59,800
Speaker 1: New York, you invested Atlanta, You've invested in South Georgia,

756
00:33:59,800 --> 00:34:02,720
Speaker 1: evest in different kinds of properties too. How do you

757
00:34:02,760 --> 00:34:04,880
Speaker 1: think is that just like do you grow that over time?

758
00:34:04,920 --> 00:34:07,120
Speaker 1: And how importance is it maybe to start off with

759
00:34:07,480 --> 00:34:11,600
Speaker 1: a like a niche inside of a particular neighborhood or

760
00:34:11,640 --> 00:34:13,880
Speaker 1: small geographic location, so you can kind of become an

761
00:34:13,920 --> 00:34:15,520
Speaker 1: expert before you expand.

762
00:34:15,320 --> 00:34:17,759
Speaker 3: Do as I say, not as I do. Definitely you

763
00:34:17,800 --> 00:34:20,319
Speaker 3: want that niche. The reason I sort of kind of

764
00:34:20,320 --> 00:34:23,160
Speaker 3: go all over is twofold one one of ADHD. But

765
00:34:23,719 --> 00:34:28,000
Speaker 3: I'm a realtor and people are you know, will come

766
00:34:28,000 --> 00:34:29,360
Speaker 3: to me and say, hey, I want to buy a

767
00:34:29,400 --> 00:34:31,480
Speaker 3: short ter mental. Hey, Alan, I want to buy a duplex.

768
00:34:31,480 --> 00:34:33,239
Speaker 3: I want to buy an apartment building. And I don't

769
00:34:33,239 --> 00:34:36,600
Speaker 3: feel comfortable giving advice unless I'm doing that too. But like, like,

770
00:34:37,000 --> 00:34:38,400
Speaker 3: who am I to give you advice on short of

771
00:34:38,400 --> 00:34:40,279
Speaker 3: mental unless I'm doing it. So I'm going to go

772
00:34:40,280 --> 00:34:42,440
Speaker 3: buy it shorter mental. I'm going to learn the ropes

773
00:34:42,560 --> 00:34:44,440
Speaker 3: so that I can teach those to my clients. I

774
00:34:44,440 --> 00:34:48,280
Speaker 3: also teach real say investing as well, and written books

775
00:34:48,280 --> 00:34:51,520
Speaker 3: and stuff. So I whatever people want to buy, I

776
00:34:51,600 --> 00:34:54,120
Speaker 3: want to go buy it along with them or before them,

777
00:34:54,280 --> 00:34:56,560
Speaker 3: so that I can be a better guide to.

778
00:34:56,480 --> 00:34:58,960
Speaker 4: Them on their investment. It's all sort of fun to me.

779
00:34:59,360 --> 00:35:01,320
Speaker 3: I always say, there's million ways to make real estate,

780
00:35:01,960 --> 00:35:03,759
Speaker 3: a million ways to make a million dollars in real estate.

781
00:35:03,880 --> 00:35:07,640
Speaker 3: Just pick one, like you can be the only by condos,

782
00:35:07,719 --> 00:35:09,840
Speaker 3: or only by townhouses, or only by single families.

783
00:35:10,040 --> 00:35:12,560
Speaker 4: But you want to accelerate.

784
00:35:12,040 --> 00:35:16,000
Speaker 3: Your path to expertise, and if you just rinse and

785
00:35:16,000 --> 00:35:18,719
Speaker 3: repeat and get those reps in. That's how you become it.

786
00:35:18,840 --> 00:35:21,839
Speaker 3: Don't get distracted by all the noise, the new shiny thing.

787
00:35:21,920 --> 00:35:25,040
Speaker 3: Like obviously, when I started Airbnb didn't even exist, and

788
00:35:25,120 --> 00:35:27,880
Speaker 3: so that's a new product. I don't know there'll be

789
00:35:28,080 --> 00:35:30,080
Speaker 3: you know, there's pad split out there right now where

790
00:35:30,120 --> 00:35:33,200
Speaker 3: you can rent by the room a single family house,

791
00:35:33,200 --> 00:35:34,879
Speaker 3: but you're renting by the room instead of renting it out.

792
00:35:34,920 --> 00:35:37,399
Speaker 3: Like there's always going to be new products. I don't

793
00:35:37,400 --> 00:35:40,400
Speaker 3: care which one you choose, pick one. I just highly

794
00:35:40,440 --> 00:35:43,320
Speaker 3: recommend that you stay at four units or fewer that

795
00:35:43,600 --> 00:35:47,799
Speaker 3: small multi family because you can get that thirty year fix,

796
00:35:47,840 --> 00:35:51,640
Speaker 3: which I love. And if you can buy a duplex,

797
00:35:51,680 --> 00:35:54,360
Speaker 3: triplex or quad, I love that much more better than

798
00:35:54,400 --> 00:35:57,600
Speaker 3: buying four single family homes because then I only have

799
00:35:57,680 --> 00:35:59,520
Speaker 3: one roof to worry about instead of four roofs. I

800
00:35:59,560 --> 00:36:01,319
Speaker 3: only have one property tax build instead of four. I

801
00:36:01,320 --> 00:36:03,320
Speaker 3: only have one pest control bill instead of four. You

802
00:36:03,719 --> 00:36:05,799
Speaker 3: can scale down all your expenses if you can kind

803
00:36:05,800 --> 00:36:07,400
Speaker 3: of condense it in that small multi family.

804
00:36:07,400 --> 00:36:07,880
Speaker 1: That's true.

805
00:36:07,960 --> 00:36:10,839
Speaker 2: Yeah, Okay, So speaking of we're gonna take a break

806
00:36:10,880 --> 00:36:12,160
Speaker 2: here in a minute, and I think we're going to

807
00:36:12,239 --> 00:36:14,759
Speaker 2: get to maybe maybe like a bunch more rapid fire

808
00:36:14,800 --> 00:36:17,120
Speaker 2: style questions with you Alan about real estate. But I'm

809
00:36:17,120 --> 00:36:19,680
Speaker 2: curious I want to follow up about the houses that

810
00:36:19,719 --> 00:36:22,000
Speaker 2: you mentioned down in Griffin. You said that you actually

811
00:36:22,040 --> 00:36:23,960
Speaker 2: sold those properties. It sounded like you held onto those

812
00:36:23,960 --> 00:36:26,279
Speaker 2: for a couple of years. The way I approach the

813
00:36:26,320 --> 00:36:29,600
Speaker 2: properties I own, I'm planning to keep them forever, and

814
00:36:29,640 --> 00:36:32,480
Speaker 2: so for you when it does come time to sell,

815
00:36:32,719 --> 00:36:34,480
Speaker 2: what's the trigger? What is it that makes you say,

816
00:36:34,480 --> 00:36:35,880
Speaker 2: all right, it's time to list these properties?

817
00:36:35,960 --> 00:36:39,520
Speaker 3: Well, it's just what I just explained why I had

818
00:36:39,560 --> 00:36:43,920
Speaker 3: fifty pest control bills. I had fifty, you know, fifty

819
00:36:43,960 --> 00:36:44,400
Speaker 3: of everything.

820
00:36:44,440 --> 00:36:44,839
Speaker 1: Too many?

821
00:36:44,880 --> 00:36:46,759
Speaker 4: And so yeah, yeah, yeah, too many?

822
00:36:46,760 --> 00:36:50,120
Speaker 3: Okay it And in two and a half so I

823
00:36:50,160 --> 00:36:53,439
Speaker 3: bought the entire portfolio, roughly each house with thirty thousand

824
00:36:53,440 --> 00:36:57,280
Speaker 3: dollars each. And I know, whatever you're visioning in your mind,

825
00:36:57,840 --> 00:37:00,680
Speaker 3: what a thirty thousand dollars house bought you five years ago?

826
00:37:02,080 --> 00:37:04,640
Speaker 3: Our south of Atlanta, like people were paying six hundred

827
00:37:04,640 --> 00:37:07,080
Speaker 3: and seve hundred bucks. And then they're very livable properties.

828
00:37:07,360 --> 00:37:10,480
Speaker 3: These were fine and mostly Section eight so where they're

829
00:37:10,520 --> 00:37:13,040
Speaker 3: guaranteed income, the government's going to pay for it. Tenants

830
00:37:13,040 --> 00:37:14,920
Speaker 3: that have been there for twenty or thirty years, and

831
00:37:15,360 --> 00:37:19,319
Speaker 3: so if I've lost you when you say you know

832
00:37:19,719 --> 00:37:22,640
Speaker 3: sure you bought a one point five million dollar portfolio.

833
00:37:23,360 --> 00:37:25,640
Speaker 3: I didn't have money to buy this property, but the

834
00:37:25,760 --> 00:37:29,239
Speaker 3: seller was a retired real state investor. His kids didn't

835
00:37:29,239 --> 00:37:33,759
Speaker 3: want these properties, and he was having trouble selling them

836
00:37:33,760 --> 00:37:36,200
Speaker 3: because at the time, there wasn't a ton of loan

837
00:37:36,239 --> 00:37:39,880
Speaker 3: products for large single family portfolios like there is now.

838
00:37:40,480 --> 00:37:44,319
Speaker 3: And so I went to them and said, hey, I

839
00:37:44,360 --> 00:37:47,600
Speaker 3: want to buy this and I'll buy them all, but

840
00:37:48,000 --> 00:37:50,080
Speaker 3: I can't get a loan for it. But no one

841
00:37:50,080 --> 00:37:52,719
Speaker 3: can get a loan for this because who's going to

842
00:37:52,760 --> 00:37:56,440
Speaker 3: get fifty different mortgages, Like, it's just not going to

843
00:37:56,480 --> 00:37:59,080
Speaker 3: make sense. So we agreed on a seller financing deal,

844
00:37:59,120 --> 00:38:01,480
Speaker 3: which means he was mortgagee. He had all these properties

845
00:38:01,520 --> 00:38:03,279
Speaker 3: paid off, so I only had to put one hundred

846
00:38:03,320 --> 00:38:06,000
Speaker 3: thousand dollars down. Again, I got another partner. I put

847
00:38:06,080 --> 00:38:08,560
Speaker 3: in fifty thousand, My partner put in fifty thousand, and

848
00:38:09,640 --> 00:38:11,440
Speaker 3: we got a fifteen year mortgage at seven and a

849
00:38:11,480 --> 00:38:14,239
Speaker 3: half percent interest rate. You know, five years ago that

850
00:38:14,440 --> 00:38:18,399
Speaker 3: was crazy because everything everyone was getting two and three

851
00:38:18,400 --> 00:38:20,759
Speaker 3: percent interest rates. But I only have to put ten

852
00:38:20,800 --> 00:38:24,880
Speaker 3: percent down on a fifty home portfolio, and it cash

853
00:38:24,880 --> 00:38:27,359
Speaker 3: flowed even at a fifteen year note. It covered all that,

854
00:38:27,960 --> 00:38:29,879
Speaker 3: and on top of that was making it would kick

855
00:38:29,880 --> 00:38:32,359
Speaker 3: off about eight to ten thousand dollars a month, and

856
00:38:32,400 --> 00:38:34,480
Speaker 3: we just took that money and put it back into

857
00:38:34,520 --> 00:38:36,560
Speaker 3: the properties, fix them up. There's a lot of deferred maintenance.

858
00:38:36,719 --> 00:38:38,879
Speaker 3: We didn't pull any of that money out. And then

859
00:38:38,880 --> 00:38:40,960
Speaker 3: eventually I bought my partner out because he wanted to

860
00:38:40,960 --> 00:38:43,319
Speaker 3: go do other investments in real estate wasn't his thing.

861
00:38:43,640 --> 00:38:45,360
Speaker 3: And then I ended up selling that property two and

862
00:38:45,360 --> 00:38:48,800
Speaker 3: a half later as a whole portfolio for two and

863
00:38:48,840 --> 00:38:51,560
Speaker 3: a half million dollars. So with I turned one hundred

864
00:38:51,600 --> 00:38:53,160
Speaker 3: thousand dollars and two and a half years into a

865
00:38:53,200 --> 00:38:56,480
Speaker 3: million dollar profit. And so that was one of those

866
00:38:56,480 --> 00:39:00,520
Speaker 3: things where I wanted to, you know, turn that into

867
00:39:00,560 --> 00:39:02,920
Speaker 3: apartment building. It makes much more sense to take that

868
00:39:03,000 --> 00:39:05,480
Speaker 3: those fifty single family homes and buy a twenty unit

869
00:39:05,480 --> 00:39:09,000
Speaker 3: apartment building because then I only have to go to

870
00:39:09,040 --> 00:39:11,960
Speaker 3: one address instead of fifty. It's much easier to property manage,

871
00:39:12,320 --> 00:39:14,480
Speaker 3: you know, allthough, you just it's so much easier to

872
00:39:15,960 --> 00:39:18,359
Speaker 3: manage when it's all under one roof, sure, rather than

873
00:39:18,520 --> 00:39:20,120
Speaker 3: spread across an entire zip going.

874
00:39:20,600 --> 00:39:23,040
Speaker 1: May not want to start that. Might know, your first

875
00:39:23,040 --> 00:39:25,920
Speaker 1: purchase is the twenty unit apartment complex, but you scaled up.

876
00:39:25,960 --> 00:39:28,080
Speaker 2: You commercial residential may not be the first thing that

877
00:39:28,120 --> 00:39:30,279
Speaker 2: somebody wants to dip their toes in the water.

878
00:39:30,360 --> 00:39:32,239
Speaker 1: So we gain the skills, and you'd also gain the

879
00:39:32,360 --> 00:39:36,080
Speaker 1: financial ability based on appreciation of your other properties and

880
00:39:36,120 --> 00:39:38,560
Speaker 1: the smart moves you've made to then take go into

881
00:39:38,560 --> 00:39:39,120
Speaker 1: that endeavor.

882
00:39:39,200 --> 00:39:41,439
Speaker 2: Yeah. Well, and you what you laid out here, Alan

883
00:39:41,520 --> 00:39:44,399
Speaker 2: is a perfect example of I love how what you said.

884
00:39:44,520 --> 00:39:46,480
Speaker 2: You said it kind of quickly, but at the time

885
00:39:46,960 --> 00:39:49,560
Speaker 2: the rate that you're paying to this owner was ludicrous,

886
00:39:49,880 --> 00:39:52,560
Speaker 2: so much higher than what anybody else out there was paying.

887
00:39:52,760 --> 00:39:55,240
Speaker 2: But for you, you were again you crunched the numbers

888
00:39:55,600 --> 00:39:58,640
Speaker 2: and you were able to see, well, man, we're making money,

889
00:39:58,640 --> 00:40:01,400
Speaker 2: but times fifty were really making money, and for you

890
00:40:01,440 --> 00:40:03,800
Speaker 2: it made a ton of sense and ended up working

891
00:40:03,840 --> 00:40:06,080
Speaker 2: out for not only you, but you and your partner.

892
00:40:06,120 --> 00:40:09,120
Speaker 2: But you know, just a second ago you also mentioned Airbnb,

893
00:40:09,840 --> 00:40:11,920
Speaker 2: how that's it's a new product, and how that has

894
00:40:12,000 --> 00:40:13,839
Speaker 2: an impact on real estate. So we've got a few

895
00:40:13,840 --> 00:40:16,120
Speaker 2: more questions about that, plus more. We'll get to all

896
00:40:16,160 --> 00:40:17,160
Speaker 2: of that right after this.

897
00:40:24,880 --> 00:40:27,839
Speaker 1: All right, we're back. If you're still listening to real

898
00:40:27,960 --> 00:40:30,960
Speaker 1: estate fire conversation with Alan Corey about investing in real

899
00:40:31,040 --> 00:40:34,680
Speaker 1: estate to boost your ability to retire early to reach

900
00:40:34,680 --> 00:40:38,759
Speaker 1: financial independence, and Alan man, I so appreciate all the

901
00:40:39,440 --> 00:40:41,759
Speaker 1: great information you've brought already, Let's get it to a

902
00:40:41,760 --> 00:40:44,520
Speaker 1: bunch of like quicker questions because there's just so much

903
00:40:44,520 --> 00:40:46,440
Speaker 1: warm wun to cover and we just don't have forever.

904
00:40:46,520 --> 00:40:48,600
Speaker 1: But like one of the things I want to talk about,

905
00:40:48,600 --> 00:40:50,719
Speaker 1: you're against paying off mortgages. You say, you call it

906
00:40:50,760 --> 00:40:53,239
Speaker 1: the dumbest thing a person can possibly do, But that

907
00:40:53,360 --> 00:40:55,560
Speaker 1: is that flies in the face of so much traditional

908
00:40:55,600 --> 00:40:58,120
Speaker 1: personal finance advice. Why are you a fan of people

909
00:40:58,120 --> 00:41:00,000
Speaker 1: holding onto their mortgages as long as possible?

910
00:41:00,239 --> 00:41:01,560
Speaker 4: Okay, I'll try to make this short.

911
00:41:02,120 --> 00:41:05,960
Speaker 3: Imagine you found a dollar in the parking lot and

912
00:41:05,960 --> 00:41:08,360
Speaker 3: in the gas station parking lot. You have two choices.

913
00:41:08,640 --> 00:41:11,160
Speaker 3: You can go mail that dollar into your mortgage note,

914
00:41:11,200 --> 00:41:12,839
Speaker 3: pay off a dollar of your principle, where you can

915
00:41:12,840 --> 00:41:14,600
Speaker 3: walk into the gas station and buy a one dollar

916
00:41:14,600 --> 00:41:17,960
Speaker 3: Snickers bar. You have that life decision. A lot of

917
00:41:17,960 --> 00:41:21,120
Speaker 3: people who have extra money, they're going to throw it

918
00:41:21,160 --> 00:41:23,279
Speaker 3: to their principal mortgage and pay it off. Now, let's

919
00:41:23,280 --> 00:41:25,120
Speaker 3: say you left that dollar there and you came back

920
00:41:25,160 --> 00:41:27,600
Speaker 3: fifteen years later and that dollar was still there, and

921
00:41:27,640 --> 00:41:29,200
Speaker 3: you're like, fine, no one's gonna pick this up. I

922
00:41:29,280 --> 00:41:31,480
Speaker 3: want to pick it up. Then what's going to happen

923
00:41:31,640 --> 00:41:33,080
Speaker 3: is you have two choices. You're going to have that

924
00:41:33,120 --> 00:41:36,560
Speaker 3: same dilemma. I can either mail it into my mortgage

925
00:41:36,640 --> 00:41:39,200
Speaker 3: lender and get another dollar off my principal payment, like

926
00:41:39,200 --> 00:41:41,440
Speaker 3: you could have done fifteen years earlier. Or you can

927
00:41:41,480 --> 00:41:42,759
Speaker 3: walk into the gas station and try to buy a

928
00:41:42,760 --> 00:41:45,200
Speaker 3: Snickers bar and guess what your Snickers bar is now

929
00:41:45,200 --> 00:41:47,080
Speaker 3: three dollars thanks to inflation.

930
00:41:47,480 --> 00:41:49,760
Speaker 4: So what does that tell you, Well, that tells.

931
00:41:49,560 --> 00:41:51,200
Speaker 3: You that everything around you is going to get more

932
00:41:51,200 --> 00:41:54,200
Speaker 3: and more expensive over time except your mortgage. Your mortgage

933
00:41:54,200 --> 00:41:55,720
Speaker 3: is the only thing that's going to stay the same

934
00:41:55,960 --> 00:41:57,480
Speaker 3: or feel like it's getting cheaper.

935
00:41:57,800 --> 00:41:58,480
Speaker 4: So why do you.

936
00:41:58,400 --> 00:42:00,360
Speaker 3: Want to get rid of the best benefit in the

937
00:42:00,360 --> 00:42:03,440
Speaker 3: world where you've locked in the most expense in your

938
00:42:03,480 --> 00:42:06,319
Speaker 3: life for thirty year mortgage, whether it's your investment or your

939
00:42:06,280 --> 00:42:08,719
Speaker 3: primary is probably the most expensive expense you can lock

940
00:42:08,760 --> 00:42:11,160
Speaker 3: that in for thirty years. Everything else is going to

941
00:42:11,160 --> 00:42:14,160
Speaker 3: get more expensive. You know, just looked at your grandparents

942
00:42:14,400 --> 00:42:17,319
Speaker 3: or your parents who bought twenty years ago, thirty years ago,

943
00:42:17,320 --> 00:42:19,239
Speaker 3: and they have like a thousand dollars mortgage payment and

944
00:42:19,280 --> 00:42:22,239
Speaker 3: they look like geniuses. They did nothing except wait and

945
00:42:22,280 --> 00:42:25,440
Speaker 3: not pay off their mortgage. So it's such a huge benefit.

946
00:42:25,600 --> 00:42:27,520
Speaker 3: I just don't understand the rush to pay it off.

947
00:42:27,520 --> 00:42:33,120
Speaker 2: People will have that emotional psychological aversion to debt. Unfortunately,

948
00:42:33,520 --> 00:42:36,600
Speaker 2: not all debt is created equal. But Alan, what do

949
00:42:36,680 --> 00:42:38,840
Speaker 2: you say to folks who are trying to limit the

950
00:42:38,840 --> 00:42:42,120
Speaker 2: amount of risk when it comes to their different properties.

951
00:42:42,120 --> 00:42:44,600
Speaker 2: Like we get the question about if folks should incorporate,

952
00:42:44,640 --> 00:42:47,920
Speaker 2: if each property should be owned by its own LLC.

953
00:42:48,360 --> 00:42:50,520
Speaker 2: Like that's one path you can go. Or another path

954
00:42:50,680 --> 00:42:54,040
Speaker 2: is umbrella insurance to cover you as an owner. Where

955
00:42:54,040 --> 00:42:55,520
Speaker 2: do you come down on that debate?

956
00:42:55,719 --> 00:42:57,240
Speaker 4: Yeah, umbrella is great.

957
00:42:57,360 --> 00:42:59,160
Speaker 3: I don't think you need an LLC unless you have

958
00:42:59,239 --> 00:43:01,040
Speaker 3: over ten property or if you get to the point

959
00:43:01,080 --> 00:43:04,040
Speaker 3: where your debt to income ratio DTI, which is sort

960
00:43:04,080 --> 00:43:06,560
Speaker 3: of how you get residential mortgages in your name. They

961
00:43:06,560 --> 00:43:08,239
Speaker 3: look at this formula, how much is your debt to

962
00:43:08,239 --> 00:43:10,799
Speaker 3: your income. If that's out of whack it's more than

963
00:43:10,840 --> 00:43:13,600
Speaker 3: fifty percent, you can't getty residential mortgages anymore. Then you

964
00:43:13,680 --> 00:43:15,960
Speaker 3: got to get an LLC and commercial. But if you're

965
00:43:15,960 --> 00:43:18,360
Speaker 3: worried about getting sued, guess who gets sued. It's the

966
00:43:18,360 --> 00:43:20,520
Speaker 3: people who have a paid off property. Let's say you

967
00:43:20,520 --> 00:43:22,840
Speaker 3: have a million dollar property that's paid off and someone

968
00:43:22,880 --> 00:43:25,520
Speaker 3: breaks their foot or whatever. They're going to sue the

969
00:43:25,520 --> 00:43:27,560
Speaker 3: person as a million dollar asset force you to sell

970
00:43:27,560 --> 00:43:29,560
Speaker 3: that asset. But if you have a million dollar property

971
00:43:29,560 --> 00:43:32,440
Speaker 3: with a nine hundred thousand dollars mortgage, the attorney's are like,

972
00:43:32,640 --> 00:43:34,400
Speaker 3: it's not worth suing them because by the time they

973
00:43:34,480 --> 00:43:36,560
Speaker 3: sell it with realtor commissions, you're not going to get

974
00:43:36,600 --> 00:43:37,120
Speaker 3: any money.

975
00:43:37,280 --> 00:43:39,920
Speaker 2: So you've got another argument for not paying off the

976
00:43:39,920 --> 00:43:42,360
Speaker 2: mortgage and keeps that loan around as long as possible.

977
00:43:42,680 --> 00:43:44,360
Speaker 3: I've got fifty arguments for that.

978
00:43:44,480 --> 00:43:46,480
Speaker 4: Yes, exactly, all right.

979
00:43:46,440 --> 00:43:48,600
Speaker 1: You talk to me about hiring a property manager verus

980
00:43:48,600 --> 00:43:51,840
Speaker 1: self managing. I'm a big fan of at least starting

981
00:43:51,880 --> 00:43:54,840
Speaker 1: off managing the property yourself so you're learning the ropes,

982
00:43:55,160 --> 00:43:57,720
Speaker 1: and then maybe down the line, especially as that property

983
00:43:57,760 --> 00:43:59,800
Speaker 1: becomes more profitable. Maybe you can add that as a

984
00:43:59,800 --> 00:44:01,920
Speaker 1: lot on them and take that off your plate, especially

985
00:44:02,200 --> 00:44:05,600
Speaker 1: as you're kind of growing your real estate portfolio. What

986
00:44:05,600 --> 00:44:06,399
Speaker 1: are your thoughts on that.

987
00:44:06,520 --> 00:44:09,400
Speaker 3: Yeah, I tell people to manage your first five. Hopefully

988
00:44:09,440 --> 00:44:12,920
Speaker 3: they're local and is driveable. If not your town, the

989
00:44:13,000 --> 00:44:15,279
Speaker 3: numbers just don't make sense for any good investment. Then

990
00:44:15,360 --> 00:44:17,040
Speaker 3: you know you're going to have to use a property manager.

991
00:44:17,280 --> 00:44:19,440
Speaker 3: And that's fine. But find a property manager and then

992
00:44:19,480 --> 00:44:21,359
Speaker 3: invest within their skill set. Well, you know, are they

993
00:44:21,560 --> 00:44:24,400
Speaker 3: section eight, are they luxuriality and are they a certain

994
00:44:24,760 --> 00:44:28,080
Speaker 3: part of the neighborhood. Understand who's going to manage it

995
00:44:28,120 --> 00:44:29,680
Speaker 3: and make sure that they can keep an eye on it.

996
00:44:30,280 --> 00:44:32,080
Speaker 3: I try to get rid of the busy work if

997
00:44:32,080 --> 00:44:33,920
Speaker 3: you find it that has just becomes busy work for

998
00:44:34,000 --> 00:44:37,760
Speaker 3: you. You know, get a property manager, and you know whether

999
00:44:38,280 --> 00:44:39,759
Speaker 3: you want to go buy more real estate or look

1000
00:44:39,800 --> 00:44:41,840
Speaker 3: for more deals, or you can now go do a

1001
00:44:41,920 --> 00:44:44,239
Speaker 3: hobby and your real estate's paying for that hobby. Or

1002
00:44:44,280 --> 00:44:47,480
Speaker 3: maybe you can work extra hours in another you know,

1003
00:44:47,560 --> 00:44:49,839
Speaker 3: side gig or something. That's what the beauty about real

1004
00:44:49,880 --> 00:44:51,080
Speaker 3: estate gives you options.

1005
00:44:51,440 --> 00:44:55,320
Speaker 2: Okay, talk about vacation rentals, Joel and I are families.

1006
00:44:55,320 --> 00:44:57,960
Speaker 2: We vacation every summer, we go to the beach, and

1007
00:44:58,000 --> 00:44:59,279
Speaker 2: a lot of times when you go to the beach

1008
00:44:59,400 --> 00:45:00,160
Speaker 2: or wherever you you.

1009
00:45:00,400 --> 00:45:02,160
Speaker 1: Go off to, you start dreaming.

1010
00:45:02,400 --> 00:45:02,880
Speaker 4: Yeah.

1011
00:45:02,680 --> 00:45:05,000
Speaker 2: Yeah, you start walking around, You're like, Oh, would be awesome,

1012
00:45:05,040 --> 00:45:07,120
Speaker 2: what if we could just come here every other month,

1013
00:45:07,360 --> 00:45:10,439
Speaker 2: you know, to our own place. But at the same time,

1014
00:45:10,640 --> 00:45:12,719
Speaker 2: I start to think through maybe the pain in the

1015
00:45:12,719 --> 00:45:15,400
Speaker 2: butt that that might be, especially if you're trying to

1016
00:45:15,440 --> 00:45:17,879
Speaker 2: manage a vacation rental. But what are your thoughts on

1017
00:45:18,600 --> 00:45:21,320
Speaker 2: investment properties that are vacation rentals.

1018
00:45:21,520 --> 00:45:24,000
Speaker 3: Yeah, it's similar to long term rentals. I usually say

1019
00:45:24,040 --> 00:45:26,239
Speaker 3: you don't want to invest in properties that you want

1020
00:45:26,280 --> 00:45:28,799
Speaker 3: to live in, because then you're making your own biases

1021
00:45:28,880 --> 00:45:31,960
Speaker 3: and emotional decisions over a spreadsheet decision. A lot of

1022
00:45:32,000 --> 00:45:34,440
Speaker 3: people want to buy that that that beach house that

1023
00:45:34,440 --> 00:45:36,919
Speaker 3: they go to every single year on fourth of July,

1024
00:45:37,320 --> 00:45:40,439
Speaker 3: and then what they don't realize is fourth of July

1025
00:45:40,520 --> 00:45:42,000
Speaker 3: is when you can make the most money out of it.

1026
00:45:42,120 --> 00:45:45,160
Speaker 3: So you're you're going to be staying in it and

1027
00:45:45,160 --> 00:45:46,680
Speaker 3: not be able to make the most money out of it.

1028
00:45:46,760 --> 00:45:48,799
Speaker 3: And then when you don't go, that's when no one

1029
00:45:48,840 --> 00:45:50,960
Speaker 3: wants to rent it because in the off season you can't.

1030
00:45:51,000 --> 00:45:52,920
Speaker 3: You know, you're you're renting it for pennies, and then

1031
00:45:52,960 --> 00:45:53,560
Speaker 3: you find.

1032
00:45:53,320 --> 00:45:54,760
Speaker 1: Yourself you're going to the beach in January.

1033
00:45:54,840 --> 00:45:57,560
Speaker 3: Now yeah, yeah, exactly, So you're you're now altering your

1034
00:45:57,600 --> 00:46:02,400
Speaker 3: your lifestyle to make sense of this investment. You go

1035
00:46:02,440 --> 00:46:04,319
Speaker 3: in the off season, or you don't go on the

1036
00:46:04,320 --> 00:46:06,359
Speaker 3: best week of the year. So I don't like miss

1037
00:46:06,680 --> 00:46:11,080
Speaker 3: mixing business and pleasure. I do like investing in sort

1038
00:46:11,080 --> 00:46:13,799
Speaker 3: of big cities. I've got some in Atlanta. I like

1039
00:46:14,400 --> 00:46:19,520
Speaker 3: sort of the sub tier touristy markets. So maybe not Disneyland,

1040
00:46:19,640 --> 00:46:23,239
Speaker 3: but maybe, you know, two hours from Disneyland, there's a

1041
00:46:23,239 --> 00:46:24,800
Speaker 3: bunch of beaches in Florida.

1042
00:46:24,880 --> 00:46:25,680
Speaker 4: You don't have the.

1043
00:46:25,640 --> 00:46:28,120
Speaker 3: Big corporations that are going to invest there. You don't

1044
00:46:28,160 --> 00:46:31,160
Speaker 3: have the hotel districts fighting you, and then the h

1045
00:46:31,320 --> 00:46:34,640
Speaker 3: you know, the airbnb laws. As much things are much cheaper,

1046
00:46:35,360 --> 00:46:36,279
Speaker 3: people will come and.

1047
00:46:36,239 --> 00:46:37,160
Speaker 4: Stay for a week.

1048
00:46:37,520 --> 00:46:40,920
Speaker 3: If it's sort of a destination rather than a weekend

1049
00:46:41,000 --> 00:46:43,480
Speaker 3: pop in kind of thing. And it's probably not something

1050
00:46:43,480 --> 00:46:45,400
Speaker 3: where I would want to go to every single you know,

1051
00:46:45,640 --> 00:46:47,719
Speaker 3: I'll go once to, you know, every now and then,

1052
00:46:47,960 --> 00:46:50,799
Speaker 3: because it's it's smallest beach town or something. But I'm

1053
00:46:50,840 --> 00:46:54,080
Speaker 3: not going there, you know, religiously with the whole family

1054
00:46:54,239 --> 00:46:54,560
Speaker 3: kind of thing.

1055
00:46:54,640 --> 00:46:57,240
Speaker 1: Sure, talk to us about scaling, because you have scaled,

1056
00:46:57,320 --> 00:46:58,920
Speaker 1: but I think you said you had like three hundred

1057
00:46:58,920 --> 00:47:00,440
Speaker 1: and fifty doors. Is that about where right now?

1058
00:47:00,680 --> 00:47:00,879
Speaker 4: Yes?

1059
00:47:01,280 --> 00:47:03,560
Speaker 3: So I've got about twenty doors in my name and

1060
00:47:03,640 --> 00:47:05,800
Speaker 3: then the rest I was through partners.

1061
00:47:05,840 --> 00:47:07,600
Speaker 1: So I want to know the when you stop, like

1062
00:47:07,719 --> 00:47:10,680
Speaker 1: what makes you quit? Because at what point is it enough?

1063
00:47:10,800 --> 00:47:13,040
Speaker 1: And like our friend Chad Carson talks about basically the

1064
00:47:13,080 --> 00:47:15,560
Speaker 1: small and mighty real estate investor, which is, hey, ten

1065
00:47:15,760 --> 00:47:18,040
Speaker 1: ten paid off units, at some point is going to

1066
00:47:18,040 --> 00:47:19,920
Speaker 1: be able to, you know, fund more than enough for

1067
00:47:20,160 --> 00:47:23,440
Speaker 1: the lifestyle you want. When do you know when do

1068
00:47:23,480 --> 00:47:25,320
Speaker 1: you stop a value of property properties? When do you

1069
00:47:25,360 --> 00:47:27,720
Speaker 1: stop investing? When do you say enough's enough? I've crushed

1070
00:47:27,719 --> 00:47:30,560
Speaker 1: it and I'm gonna, like, I don't know, be more leisurely.

1071
00:47:30,800 --> 00:47:33,520
Speaker 3: I've got through to fifty doors. But it's it's fun

1072
00:47:33,600 --> 00:47:36,080
Speaker 3: for me. It doesn't feel like work. I've got a

1073
00:47:36,120 --> 00:47:38,840
Speaker 3: lot of people who want to invest with me, or

1074
00:47:38,960 --> 00:47:40,759
Speaker 3: they find a deal and they say, Alan, how can

1075
00:47:40,800 --> 00:47:41,439
Speaker 3: we get this done?

1076
00:47:42,360 --> 00:47:43,640
Speaker 4: Achieved? A lot through real estate.

1077
00:47:43,719 --> 00:47:45,279
Speaker 3: But it's not like, oh, I'm gonna get happier if

1078
00:47:45,280 --> 00:47:46,799
Speaker 3: I have more. If I get happier if I have more.

1079
00:47:47,080 --> 00:47:49,480
Speaker 3: It's just I like treasure hunting. I'm like the guy

1080
00:47:49,600 --> 00:47:54,399
Speaker 3: on the beach with the electrical thing. What's that called

1081
00:47:54,480 --> 00:47:59,560
Speaker 3: the metal detectors. Yeah, like that guy's life going to

1082
00:47:59,680 --> 00:48:02,759
Speaker 3: change it finds a wedding band. No, it's just fun

1083
00:48:02,880 --> 00:48:05,799
Speaker 3: and entertaining for them. And that's me in real estate.

1084
00:48:05,880 --> 00:48:08,799
Speaker 3: It's fun to look at opportunities. Oh, this is an opportunity, guys.

1085
00:48:08,840 --> 00:48:11,040
Speaker 3: Do you guys want to pass around out and get

1086
00:48:11,040 --> 00:48:13,439
Speaker 3: this done? Or should I buy this myself? Like it's

1087
00:48:14,560 --> 00:48:16,719
Speaker 3: I enjoy it, it's my hobby, you know.

1088
00:48:16,880 --> 00:48:17,720
Speaker 1: I love it. Obviously.

1089
00:48:17,760 --> 00:48:19,239
Speaker 2: I think there's a lot of folks who are just like, Man,

1090
00:48:19,840 --> 00:48:22,640
Speaker 2: I've got a job that I took so that I

1091
00:48:22,680 --> 00:48:25,000
Speaker 2: can pay the bills. I don't enjoy my work, but

1092
00:48:25,120 --> 00:48:28,160
Speaker 2: the ability that's something over time that you do want

1093
00:48:28,200 --> 00:48:30,440
Speaker 2: to sit your sights on the kind of work that's

1094
00:48:30,480 --> 00:48:32,080
Speaker 2: going to be fulfilling, the kind of work that's going

1095
00:48:32,120 --> 00:48:34,080
Speaker 2: to be able to allow you to at some point

1096
00:48:34,320 --> 00:48:37,279
Speaker 2: achieve some sense of financial freedom. But I love that

1097
00:48:37,520 --> 00:48:39,359
Speaker 2: and the value that you're able to put out into

1098
00:48:39,400 --> 00:48:41,880
Speaker 2: the world through the work that you do is It's

1099
00:48:41,920 --> 00:48:45,320
Speaker 2: a huge part of life fulfillment. And I think our

1100
00:48:45,640 --> 00:48:49,040
Speaker 2: opinions of retirement has even changed over the years. Joe

1101
00:48:49,080 --> 00:48:50,960
Speaker 2: and I as as this is something that we've talked

1102
00:48:50,960 --> 00:48:54,680
Speaker 2: about a lot. But you mentioned Airbnb earlier. Alan without

1103
00:48:54,760 --> 00:48:58,040
Speaker 2: being a platform that can change the rules and not

1104
00:48:58,160 --> 00:49:03,520
Speaker 2: only what say Airbnb charges folks what they charge hosts,

1105
00:49:03,560 --> 00:49:06,000
Speaker 2: but even cities and how there's a lot of cities

1106
00:49:06,000 --> 00:49:09,000
Speaker 2: that are claiming down on short term rentals. How much

1107
00:49:09,000 --> 00:49:12,440
Speaker 2: should investors take that into account as they're looking to

1108
00:49:12,480 --> 00:49:13,200
Speaker 2: buy a property.

1109
00:49:13,400 --> 00:49:16,799
Speaker 3: Yeah, you should take an account and that never buy

1110
00:49:17,160 --> 00:49:20,000
Speaker 3: a vacation rental that won't cash flow as a long

1111
00:49:20,080 --> 00:49:23,080
Speaker 3: term rental. So if the laws change, you can just

1112
00:49:23,160 --> 00:49:24,919
Speaker 3: pivot it into a long term mental and you're still

1113
00:49:24,960 --> 00:49:27,920
Speaker 3: cash flowing. So you run your numbers twice, you run well,

1114
00:49:28,080 --> 00:49:30,600
Speaker 3: run first as a long term rental, and if it

1115
00:49:30,800 --> 00:49:32,560
Speaker 3: makes sense as a long term mental, if that day

1116
00:49:32,600 --> 00:49:35,080
Speaker 3: ever comes, whether it's tomorrow or ten years from now,

1117
00:49:35,920 --> 00:49:39,040
Speaker 3: you've got that's your pivot point. I always love properties

1118
00:49:39,080 --> 00:49:41,399
Speaker 3: that have pivots. The more pivots you have, the better.

1119
00:49:41,760 --> 00:49:43,839
Speaker 3: And so you can say, well, I'll make four times

1120
00:49:43,840 --> 00:49:46,040
Speaker 3: as much money as a short term mental and if

1121
00:49:46,239 --> 00:49:48,120
Speaker 3: they change the laws on me, I'll make you know,

1122
00:49:48,239 --> 00:49:50,400
Speaker 3: I'll still make money. I'm not losing money as a

1123
00:49:50,440 --> 00:49:52,880
Speaker 3: long term rental. Yeah, that's how you go about it.

1124
00:49:53,040 --> 00:49:53,360
Speaker 2: I love it.

1125
00:49:53,360 --> 00:49:55,480
Speaker 1: That's a little more conservative in nature too, just making

1126
00:49:55,520 --> 00:49:57,480
Speaker 1: sure that. Yeah, because that's happened. I had a friend

1127
00:49:57,480 --> 00:50:00,880
Speaker 1: who bought one in Chattanooga, and then Chattanooga it says, wait, wait,

1128
00:50:01,520 --> 00:50:03,480
Speaker 1: no more short term rentals here, at least of the

1129
00:50:03,520 --> 00:50:05,719
Speaker 1: time being, And so he's kind of halted for a

1130
00:50:05,840 --> 00:50:08,040
Speaker 1: minute at least from buying more. He's able to still

1131
00:50:08,280 --> 00:50:09,920
Speaker 1: he's grandfathered in for the one he's got. But that

1132
00:50:09,960 --> 00:50:12,239
Speaker 1: can be a really tough position to find yourself in.

1133
00:50:12,560 --> 00:50:14,920
Speaker 1: But Alan, thank you so much for joining us today

1134
00:50:14,960 --> 00:50:17,279
Speaker 1: on the show. Where can our listeners find out more

1135
00:50:17,440 --> 00:50:19,680
Speaker 1: about you? More about your house fire method?

1136
00:50:20,040 --> 00:50:20,200
Speaker 4: Yeah?

1137
00:50:20,239 --> 00:50:22,560
Speaker 3: Sure, I'm a real estate maximalist, so you can find

1138
00:50:22,600 --> 00:50:26,040
Speaker 3: me on social media real estate MAXI Also I teach

1139
00:50:26,080 --> 00:50:29,000
Speaker 3: real state investing at house Money Media and we have

1140
00:50:29,080 --> 00:50:32,320
Speaker 3: a podcast called the House Money Real Estate Investing Podcast,

1141
00:50:32,440 --> 00:50:34,680
Speaker 3: So all those channels would be great.

1142
00:50:34,760 --> 00:50:36,560
Speaker 1: Awesome, Alan, Thank you so much for taking the time

1143
00:50:36,600 --> 00:50:37,920
Speaker 1: out of your day to talk with us.

1144
00:50:38,200 --> 00:50:40,440
Speaker 4: Thanks guys, it's been blast all right, man.

1145
00:50:40,480 --> 00:50:42,760
Speaker 1: That was a good combo, a lot of interesting information,

1146
00:50:42,960 --> 00:50:46,919
Speaker 1: obviously from someone who's rabbit all in on real estate,

1147
00:50:47,280 --> 00:50:49,560
Speaker 1: and so it's just nice to pick his brains as

1148
00:50:49,600 --> 00:50:52,320
Speaker 1: someone who I think is we like real estate. You

1149
00:50:52,400 --> 00:50:54,000
Speaker 1: kind of like set it up nicely at the beginning

1150
00:50:54,160 --> 00:50:56,719
Speaker 1: of the episode. It's like, we're not Alan Rabbit Dog

1151
00:50:56,800 --> 00:51:00,920
Speaker 1: Corey though. Yeah, but I did his insights. I think

1152
00:51:00,920 --> 00:51:03,239
Speaker 1: there's a lot that some people who are interested in

1153
00:51:03,320 --> 00:51:06,480
Speaker 1: investing in realistic can learn from Alan And from this episode.

1154
00:51:06,640 --> 00:51:08,440
Speaker 1: What was your big takeaway though from this combo?

1155
00:51:08,719 --> 00:51:11,120
Speaker 2: I think my big takeaway is being is influenced by

1156
00:51:11,160 --> 00:51:13,560
Speaker 2: the fact that I don't want to alienate alien eight

1157
00:51:13,560 --> 00:51:15,120
Speaker 2: folks who are listening to this, and they're just like,

1158
00:51:15,320 --> 00:51:18,080
Speaker 2: three hundred and fifty doors, what the like, I'm never

1159
00:51:18,360 --> 00:51:20,560
Speaker 2: gonna do that, And so I'm gonna take it back

1160
00:51:20,560 --> 00:51:22,920
Speaker 2: to personal finance and at the beginning, because I think

1161
00:51:22,920 --> 00:51:24,560
Speaker 2: there's a lot of folks who are saying, well, yeah,

1162
00:51:24,600 --> 00:51:26,400
Speaker 2: if I had that much money on hand, sure, if

1163
00:51:26,480 --> 00:51:29,439
Speaker 2: I could go to a hard money lender and drop

1164
00:51:29,480 --> 00:51:32,360
Speaker 2: one hundred thousand dollars like, there's a lot of if onlys.

1165
00:51:32,840 --> 00:51:35,799
Speaker 2: And the fact is Alan got to that point by

1166
00:51:36,320 --> 00:51:38,160
Speaker 2: working his butt off when he was up in New

1167
00:51:38,239 --> 00:51:40,240
Speaker 2: York and he was socking. He was setting aside fifty

1168
00:51:40,280 --> 00:51:42,920
Speaker 2: percent of his paycheck. Man, wasn't a big paycheck, it

1169
00:51:43,040 --> 00:51:46,320
Speaker 2: wasn't a bunch, but that percentage. Think about what folks

1170
00:51:46,360 --> 00:51:48,359
Speaker 2: could do right now, who are in their twenties if

1171
00:51:48,360 --> 00:51:50,200
Speaker 2: they set aside fifty percent of their pitcheck for a

1172
00:51:50,280 --> 00:51:52,400
Speaker 2: short period of time. I'm not saying that you have

1173
00:51:52,480 --> 00:51:54,360
Speaker 2: to do this in definitely, but the ability to do

1174
00:51:54,440 --> 00:51:56,480
Speaker 2: that for a short period of time to achieve some

1175
00:51:57,160 --> 00:52:01,160
Speaker 2: very quantifiable, measurable goals, Well, if you want something bad enough,

1176
00:52:01,320 --> 00:52:03,320
Speaker 2: that is what it takes. And by doing that you

1177
00:52:03,440 --> 00:52:06,400
Speaker 2: can achieve something as massive as what Alan has been

1178
00:52:06,440 --> 00:52:06,719
Speaker 2: able to do.

1179
00:52:06,800 --> 00:52:08,320
Speaker 1: When he was describing that, all I could think was

1180
00:52:08,440 --> 00:52:10,759
Speaker 1: frontloading the sacrifice, which is what Dachi talks about, and

1181
00:52:10,800 --> 00:52:12,520
Speaker 1: that's exactly what he was doing. He was saying, like, listen,

1182
00:52:12,840 --> 00:52:15,319
Speaker 1: I'm going to go the opposite of hog wild right now.

1183
00:52:15,719 --> 00:52:17,960
Speaker 1: I'm going to cut to the bone just for a

1184
00:52:18,040 --> 00:52:19,520
Speaker 1: few years, so that I can build up this nest

1185
00:52:19,560 --> 00:52:21,560
Speaker 1: egg and then boom, I'm gonna make an investment or two,

1186
00:52:22,080 --> 00:52:24,640
Speaker 1: and then eventually I'll be able to inflate my lifestyle.

1187
00:52:24,680 --> 00:52:28,040
Speaker 1: He's not eating ramen every night now he was back then.

1188
00:52:28,239 --> 00:52:30,520
Speaker 1: The sense of packet, he's about how many fancy tween

1189
00:52:30,600 --> 00:52:31,800
Speaker 1: hats he has Now, I mean, like, come on, he

1190
00:52:31,840 --> 00:52:33,800
Speaker 1: would not have imagined that back then. That's right, but

1191
00:52:34,160 --> 00:52:36,680
Speaker 1: I appreciate that that. It's like, for a period of time,

1192
00:52:36,719 --> 00:52:39,200
Speaker 1: I'm willing to do this in sacrifice, even more than

1193
00:52:39,200 --> 00:52:41,440
Speaker 1: I want to do in the future. But it's because

1194
00:52:41,440 --> 00:52:43,440
Speaker 1: I'm preparing that future for myself, and I think it's

1195
00:52:43,440 --> 00:52:45,120
Speaker 1: a good way looking at it totally. Yeah, what about

1196
00:52:45,120 --> 00:52:47,200
Speaker 1: you was your big takeaway though, So I like when

1197
00:52:47,239 --> 00:52:50,120
Speaker 1: he said get reps in and you get better with

1198
00:52:50,200 --> 00:52:52,880
Speaker 1: things over time. I remember man being so freaking scared

1199
00:52:52,920 --> 00:52:55,239
Speaker 1: running out my first property, and then the second one.

1200
00:52:55,440 --> 00:52:58,200
Speaker 1: I was still pretty nervous, but not nearly as frightened,

1201
00:52:58,400 --> 00:53:00,279
Speaker 1: and then over time you're like, wait a second, and

1202
00:53:00,360 --> 00:53:01,240
Speaker 1: some of that confidence.

1203
00:53:01,400 --> 00:53:01,560
Speaker 2: Yeah.

1204
00:53:01,760 --> 00:53:03,640
Speaker 1: Now, I think part of the reason he's so gung

1205
00:53:03,719 --> 00:53:05,759
Speaker 1: ho on it is because he's been doing it so long.

1206
00:53:05,800 --> 00:53:07,920
Speaker 1: He's been so successful, He's made so many good deals

1207
00:53:08,239 --> 00:53:10,719
Speaker 1: and over time and he's learned from the bad ones too,

1208
00:53:11,040 --> 00:53:13,560
Speaker 1: and so you just kind of then you begin to

1209
00:53:13,600 --> 00:53:15,440
Speaker 1: know what to look out for, the fine print to

1210
00:53:15,480 --> 00:53:18,040
Speaker 1: watch out for, maybe how to screen tenants even better,

1211
00:53:18,360 --> 00:53:21,720
Speaker 1: and it becomes this well oiled machine. But it involves

1212
00:53:21,800 --> 00:53:24,040
Speaker 1: getting reps. You just don't get better by sitting on

1213
00:53:24,120 --> 00:53:26,719
Speaker 1: the sidelines and consuming information in the same way you

1214
00:53:26,840 --> 00:53:29,080
Speaker 1: do by getting in there and trying the ole man

1215
00:53:29,120 --> 00:53:30,919
Speaker 1: in the arena thing, I guess, right, But yeah, yeah,

1216
00:53:31,040 --> 00:53:33,640
Speaker 1: So it's obviously important to do your due diligence and

1217
00:53:34,160 --> 00:53:36,080
Speaker 1: know the market in and out that you want to

1218
00:53:36,120 --> 00:53:38,040
Speaker 1: invest in, kind of like he was actually talking about too,

1219
00:53:38,400 --> 00:53:40,360
Speaker 1: But then it's important to get in there and actually

1220
00:53:40,440 --> 00:53:43,560
Speaker 1: do the thing. Start off small, self managed, learn as

1221
00:53:43,600 --> 00:53:45,600
Speaker 1: you're doing, and the more reps you get in, the

1222
00:53:45,640 --> 00:53:46,560
Speaker 1: better you're gonna get at it.

1223
00:53:46,960 --> 00:53:48,600
Speaker 2: Yeah, I think that's I think that's when he was

1224
00:53:48,600 --> 00:53:52,280
Speaker 2: talking about finding a specialty and focusing like laser focus,

1225
00:53:52,320 --> 00:53:54,440
Speaker 2: because I think that's so important as well, not only

1226
00:53:54,480 --> 00:53:57,799
Speaker 2: getting the reps in massive number of reps, but really

1227
00:53:57,960 --> 00:53:59,840
Speaker 2: narrowing in on what it is that you're going to

1228
00:53:59,880 --> 00:54:02,880
Speaker 2: say specialized in it, but our beer Joel, that you

1229
00:54:02,880 --> 00:54:05,960
Speaker 2: and I enjoyed today was an OOST. I wanted to

1230
00:54:06,000 --> 00:54:08,880
Speaker 2: say that that's that's what it's called o sd oust.

1231
00:54:09,560 --> 00:54:13,440
Speaker 2: This is another one by High Grain Brewing Company and

1232
00:54:13,640 --> 00:54:15,520
Speaker 2: it was donated by Mike and Christy.

1233
00:54:15,560 --> 00:54:17,600
Speaker 1: What were your thoughts? Yeah, I like this when it

1234
00:54:17,680 --> 00:54:20,719
Speaker 1: had like caramel vibes some FIGI notes. I thought it was,

1235
00:54:20,920 --> 00:54:24,320
Speaker 1: oh yeah, smooth and warming. Uh, it was definitely warming,

1236
00:54:24,680 --> 00:54:26,960
Speaker 1: So there's no joke. It's a strong strong ale. So

1237
00:54:27,120 --> 00:54:29,719
Speaker 1: this is a ten percenter and you could pick up

1238
00:54:29,760 --> 00:54:32,000
Speaker 1: on some of that peppery nests that came from that

1239
00:54:32,600 --> 00:54:35,480
Speaker 1: basically from the higher gravity, but almost had like a

1240
00:54:35,960 --> 00:54:38,800
Speaker 1: clove like pepperinus too it because of that higher ABV

1241
00:54:39,640 --> 00:54:40,320
Speaker 1: while still.

1242
00:54:40,280 --> 00:54:43,880
Speaker 2: Maintaining it's like Belgian banana like sweetness that you get

1243
00:54:43,920 --> 00:54:47,200
Speaker 2: from Belgian golden strong ales like this. But is it

1244
00:54:47,680 --> 00:54:51,000
Speaker 2: is it monkey? What's the victory Golden monkey that I

1245
00:54:51,040 --> 00:54:52,360
Speaker 2: feel like had that years me?

1246
00:54:52,400 --> 00:54:52,600
Speaker 4: Neither.

1247
00:54:52,640 --> 00:54:55,680
Speaker 2: I think that was my first golden Golden strong as.

1248
00:54:55,480 --> 00:54:57,080
Speaker 1: Okay, but I mean that was a classic back in

1249
00:54:57,120 --> 00:54:58,800
Speaker 1: the day. But I don't think I've had a victory

1250
00:54:58,840 --> 00:54:59,319
Speaker 1: beer in forever.

1251
00:54:59,440 --> 00:55:02,600
Speaker 2: It's been a but Mike and Chrissy thank y'all again

1252
00:55:02,880 --> 00:55:06,040
Speaker 2: for sending this one plus the others our way for sure.

1253
00:55:06,040 --> 00:55:07,560
Speaker 1: All right, let's going to do it for this episode.

1254
00:55:07,760 --> 00:55:09,399
Speaker 1: We'll have links up in the show notes to help

1255
00:55:09,440 --> 00:55:12,440
Speaker 1: you if you're interested in investing in real estate, so

1256
00:55:12,560 --> 00:55:14,960
Speaker 1: please do check those out, but Matt, until next time,

1257
00:55:15,200 --> 00:55:17,200
Speaker 1: Best friends Out, Best Friends Out,