Real Estate Investing School Podcast Episode 149: Invest Early and Earn Forever with Craig Lively

Release Date: April 15, 2024
Host: Joe Jensen
Guest: Craig Lively

Episode Overview

This episode features Craig Lively, a father, husband, software salesman, and dedicated real estate investor. Craig shares his journey from house hacking in college with zero money to building a property portfolio that provides both financial security and lifestyle flexibility. The conversation covers starting with limited resources, the realities and strategies of house hacking, remote investing, creating multiple income streams, and the broader philosophy behind using money as a tool for life. Joe and Craig offer actionable tips and inspiration for both new and seasoned investors, with a consistent emphasis on starting early, leveraging what you have, and relying on both expertise and community.

Key Discussion Points & Insights

1. Getting Started: From Zero to First Property

[01:17-05:40]

• Craig’s Spark: Inspired by a college friend’s cashflow from renting out a condo, Craig was drawn to real estate despite having “no money.”
• Education Phase: Consumed books (e.g., Rich Dad Poor Dad) and podcasts, deepening his understanding before investing.
• First Purchase:
  • Saved $7,000 in six months after getting married, starting with a 3% FHA loan.
  • Purchased a Provo home in 2015, moving into and gut-renovating the basement themselves.

Key Quote (Craig, 01:50):

“I would see the literal cashflow coming from the tenants each month and that, you know, my eyes at a college student... I don't have any money. Seeing that really piqued my interest from the get go.”

2. Extreme House Hacking and Creative Solutions

[05:09-08:12]

• Maximizing the Asset:
  • Rented out the renovated basement and put the spare bedroom on Airbnb while living in the main level.
  • Made about $500/month while living there (“extreme house hack”).
• Iterative Growth:
  • Second home: repeated house-hacking, renting out the basement.
  • Sacrificed short-term comfort for long-term gain; these decisions dramatically shaped their current stability.

Key Insights:

• Renting out spare rooms or basements on Airbnb is “old school” but highly effective.
• Willingness to sacrifice privacy can be life-changing financially.

3. The Importance of Starting Early

[08:13-10:57]

• Time is Key:
  • Real estate’s biggest advantage is compounding equity and appreciation over time.
  • Early sacrifices (scrimping, hustle, FHA/conventional low-down loans) mean bigger rewards later.
• Action Over Perfection:
  • Don't wait to be "comfortable" financially to buy; doing it when it feels hard is usually the right time.

Key Quote (Joe, 09:50):

“I've never met anybody they regretted... that first property... Even if you wait until it's easy, you waited too long.”

4. Resilience Through Real Estate: Job Loss & Security

[11:55-15:37]

• Craig’s Layoff Story ([12:14]):
  • Recently laid off from his software sales job, but not “shaking in my boots,” thanks to real estate income.
  • Current rent is fully covered by property cashflow (portfolio: 6 doors/properties).
• Active vs. Passive Skills:
  • Beyond passive income, real estate teaches active wealth-creation skills (e.g., finding deals, flips, wholesaling).

Key Quote (Craig, 12:56):

“I'm not...wondering what's next... and that's basically just due to real estate.”

5. Transitioning to Remote Investing & Building an Out-of-State Team

[17:07-24:54]

• First Remote Buy:
  • March 2020, at the outset of COVID-19, closed on a rental in Indianapolis without ever seeing it in person.
  • Built a remote team (agent, lender, property manager, contractors) through deliberate vetting.
• Why Indianapolis?
  • Chose for landlord-friendly laws, low taxes, strong rent ratios, and net positive migration.
• Team Building Method:
  • Interviewed a dozen professionals in each role, triangulated best referrals.

Key Quote (Joe, 24:23):

“That was gold what he just explained… I'm like, go talk to five [local professionals]... see who you vibe with… It’s so simple but how many listeners will actually do that?”

6. Vet Your Own Deals & Use the Right Tools

[24:54-33:20]

• Analyzing Deals:
  • Created his own Excel “deal calculator” to accurately forecast cashflow and capex.
  • Leveraged online groups (e.g., Facebook) for mentorship and “gut checks.”
  • Emphasizes balancing expert input, personal responsibility, and data (“art and science”).

Key Quote (Craig, 26:41):

“I've created my own rental cash flow cheat sheet in my Excel sheet... think of all the different things that you might have to spend money on... [and] gauge with inspector, agent, and mentors.”

Pro Tip:

• Build your own spreadsheet rather than rely exclusively on others’; you’ll learn more and analyze faster.

7. Money Philosophy & Leveraging Creativity

[33:20-39:15]

• Money as a Tool:
  • Real estate is Craig’s “tried and true” vehicle, though he diversifies with some index funds and “hedge” crypto investments.
• Credit Card Hacking:
  • Used sign-up bonuses and points to pay for significant travel (e.g., three weeks in Europe with little cash).
  • Advocates maximizing rewards on purchases, both personal and business, to free up cash for investment.

Key Quote (Craig, 33:47):

“Real estate is certainly number one in my book... something that I know personally.”

8. Guiding Principles & Vision

[38:03-41:37]

• Lifestyle Design:
  • Primary focus on investing—assets over luxuries—creates capability for future enjoyment.
  • Place investing above consumption; build the asset portfolio “at all costs”.

Key Quote (Joe, 39:15):

“Your number one fiscal responsibility is to grow your asset portfolio. Drill that into your brain and your soul and tattoo it on your forehead.”

9. Remote Investing Logistics & Mindset

[41:37-45:32]

• You Don’t Need to Be Local:
  • Using technology (video walkthroughs, online communication) and trusted local professionals, anyone can invest remotely.
• Delegate Wisely:
  • “Even if it’s local, you’ll need a property manager and contractor—just like with remote deals.”
• Open-Mindedness:
  • Challenge the limiting belief that you must see or manage properties in-person.

Notable Quotes & Memorable Moments

• On Sacrifice and Perspective Change:
  “We had our home, but we weren’t really, like, living in our home. It was like sharing our home, basically. But...those two decisions right then and there, like, just shaped, you know, to where we are today.” (Craig, 06:49)

• On Rushing vs. Waiting in Real Estate:
  “If you wait until it’s easy, you waited too long… you should have done it when you were like, ‘how the hell are we going to do this?’” (Joe, 10:57)

• On Analysis and Taking Action:
  “You gotta sometimes go with your gut after you’ve ran the numbers – or maybe you’re going to be stretched a little bit. That’s when you’re going to learn the most.” (Craig, 00:00 & 29:10)

Timestamps for Key Segments

• Craig’s Introduction & Background: 00:18–01:50
• First House Hack Story: 03:42–06:49
• Benefits of Early Investment: 08:12–10:57
• Job Loss and Financial Security: 11:55–15:37
• First Remote Real Estate Deal: 17:07–19:45
• Team Building & Vetting Professionals: 19:45–24:23
• Deal Analysis Tools & Mentorship: 24:54–33:20
• Philosophy on Money & Rewards Hacking: 33:20–39:15
• Growth Mindset & Investing Priorities: 38:03–41:37
• Remote Investing Insights: 41:37–45:32

Final Four: Rapid Fire Questions

[45:48+]

1. Dream Deal:

   • Off-market, seller-financed, value-add self storage facility in the future. (Craig, 46:06)

2. Most Pivotal Book/Podcast:

   • Can’t Hurt Me by David Goggins (“Changed my life… signed up for a sprint triathlon six days out because of it.”) (Craig, 46:46–47:32)

3. Biggest Real Estate Mistake:

   • Bought a discounted duplex from a wholesaler in Indy without enough diligence; unforeseen capex costs and less-than-ideal location. Warns listeners: "Do your due diligence, don’t get rushed." (Craig, 51:40–54:34)

4. What Brings Joy Outside of Work:

   • Family time, triathlons (3rd coming up), golfing, and travel (often via credit card points). (Craig, 55:29)

Key Takeaways for Listeners

• Start Early: Small steps and sacrifices set the foundation for generational wealth.
• Be Resourceful: Creative approaches like house hacking, remote investing, or maximizing points can stretch limited resources further.
• Build Relationships: Interview and align with the right professionals who understand investor needs.
• Do the Work: Analyze deals yourself; develop your own frameworks and tools.
• Take Action Before You’re 100% Ready: Most regret is about not starting, not about the “hard” early years.

Connect with Craig Lively:

• Instagram: lively.craig

Closing Reminder

Joe’s Challenge:

“Just go do it Tuesday. Don’t wait until you have all the answers—take action, get started, and learn as you go.” (56:37)

Whether you’re just getting interested or ready to take your portfolio to the next level, this episode delivers practical tips, real stories—successes and mistakes—and an inspiring push to “pull the trigger” and start building your future now.