BiggerPockets Real Estate Podcast Summary: "You DON’T Need 20+ Rentals to Quit (I Did It With 6)"

Release Date: June 2, 2025
Host: Dave Meyer
Guest: Miller McSwain

Introduction

In the episode titled "You DON’T Need 20+ Rentals to Quit (I Did It With 6)," Dave Meyer interviews Miller McSwain, a former nuclear rocket scientist from Colorado who transitioned to full-time real estate investing after building a profitable portfolio of six rental properties. Miller shares his journey, highlighting his innovative co-living strategy that transformed his investments into 41 separate units, enabling him to achieve financial freedom without the need for a vast number of properties.

Miller’s Background and Transition to Real Estate

Miller McSwain began his career as a nuclear rocket scientist, a role he humorously describes as "casual nuclear" ([01:56] Miller McSwain). Despite the high-tech nature of his day job, Miller found himself drawn to real estate investing early on. He and his wife purchased their first property just two months before his graduation, embarking on their investment journey with limited funds and a shoestring budget.

Notable Quote:
"You don't need a lot of starting cash or any secret sauce to replicate this exact investing path." ([00:00] Dave Meyer)

The House Hacking Strategy

Miller and his wife chose Colorado Springs as their investment hub after extensive research and a three-week road trip to explore different cities ([02:55] Miller McSwain). Their initial investment was a single-family ranch with a basement, which allowed them to live in the basement and rent out three rooms upstairs. This approach, known as house hacking, enabled them to cover nearly the entire mortgage through rental income.

Notable Quote:
"House hacking is very low risk. It's like we have to live somewhere. So we're either going to move to Colorado Springs and rent an apartment or buy this place and rent out at least one room." ([06:21] Miller McSwain)

Balancing Full-Time Employment and Real Estate

While managing their first property, Miller juggled a full-time job, dedicating evenings to furnishing, cleaning, taking listing photos, and filling the rented rooms ([04:44] Miller McSwain). The initial phase was hectic, but as the rooms filled, the workload became more manageable.

Notable Quote:
"It was like a big rush in the beginning... but it kind of chilled out from there." ([05:23] Miller McSwain)

Scaling the Portfolio Through Co-Living

After successfully managing the first property, Miller and his wife expanded to a second house hack 12 months later. They focused on refining their systems, such as managing shared supplies and implementing resident-led property tours to streamline operations ([07:39] Miller McSwain).

Determined to specialize, Miller adopted a focused strategy inspired by Andrew Carnegie’s philosophy of concentrating efforts to maximize wealth. This approach allowed them to become experts in the co-living model, leading to rapid portfolio growth with six properties and over 40 units within two and a half years ([20:12] Dave Meyer; [21:56] Miller McSwain).

Notable Quote:
"If you want to get really wealthy, you need to put all of your eggs in one basket and just watch that basket like a hawk." ([20:22] Miller McSwain)

Financial Performance and Returns

Miller boasts impressive financial metrics, achieving a 12-14% cash on cash return on his properties ([21:51] Miller McSwain). This is significantly higher than typical long-term rentals, which often yield around 4-5% in many markets. By investing in appreciation markets and employing a room rental model, Miller ensures both consistent cash flow and property value appreciation.

Notable Quote:
"We're getting around like 12 to 14% cash on cash." ([23:42] Miller McSwain)

Advantages of the Co-Living Model

Miller highlights several benefits of the co-living model over traditional rental strategies:

1. Diversified Income Streams: With multiple tenants, the risk of income loss due to a single vacancy is minimized.
2. Favorable Regulations: Unlike short-term rentals, co-living often enjoys supportive regulations aimed at increasing affordable housing ([15:27] Miller McSwain).
3. Remote Management Efficiency: Implementing systems and leveraging tenant participation make managing multiple units feasible without being physically present.

Notable Quote:
"Co living provides more affordable housing for locals and has been met with favorable regulations in several states." ([17:00] Miller McSwain)

Effective Remote Management Strategies

Managing co-living properties remotely is streamlined through:

• Resident Involvement: Encouraging tenants to lead property tours and handle minor maintenance tasks fosters a sense of ownership and reduces the landlord’s workload.
• Systematized Processes: Implementing standardized procedures for supplies management, property tours, and maintenance ensures consistency and efficiency ([28:22] Miller McSwain).
• Regular Property Checks: Routine visits by handymen and cleaners provide additional oversight, keeping the property in good condition and promptly addressing issues ([36:13] Miller McSwain).

Notable Quote:
"We treat all of our properties like we're managing them remotely, and it's actually easier than managing a long-term rental." ([18:26] Miller McSwain)

Tenant Screening and Retention

Miller employs rigorous tenant screening processes, including credit and background checks, and uniquely incentivizes tenants to provide rental references by adjusting security deposits based on the number of positive references ([32:50] Miller McSwain). Additionally, fostering a community through regular events like pizza nights and bowling outings enhances tenant satisfaction and retention ([34:31] Miller McSwain).

Notable Quote:
"When you provide opportunities for tenants to build connections, they're more likely to stay longer." ([35:42] Miller McSwain)

Getting Started with Co-Living Investments

For aspiring co-living investors, Miller advises:

1. Property Acquisition: Focus on properties that meet specific criteria such as adequate parking, appropriate size, and desirable locations near workplaces or amenities.
2. Understanding Your Demographic: Target tenants who seek affordable, shared living spaces, such as lower-income workers, students, military personnel, and interns.
3. Location Considerations: Proximity to public transportation and a high walk score can significantly impact tenant satisfaction and property desirability ([28:45] Miller McSwain).

Notable Quote:
"You need to think about the sort of tenant that is in need of a room... proximity to where they work or hang out helps narrow down the location." ([29:02] Miller McSwain)

Conclusion

Miller McSwain's success story underscores that you don't need an extensive portfolio to achieve financial independence through real estate investing. By adopting a focused co-living strategy, implementing efficient management systems, and fostering a strong community among tenants, Miller was able to generate substantial cash flow and secure a 12-14% cash on cash return. His journey from a full-time nuclear rocket scientist to a successful real estate investor serves as an inspiring blueprint for those looking to leverage creativity and strategic planning in their investment endeavors.

Final Thought:
"This co living model is a mega cash flow strategy. It's a lot of work for a lot of cash flow, but if you're willing to put in the effort, it could be a great option for you." ([13:43] Miller McSwain)

For more insights and detailed strategies on co-living investments, consider exploring Miller McSwain's newly released book, Co-Living Cash Flow: A BiggerPockets Guide, available on Amazon and at BiggerPockets.com.