Real Estate Investing School Podcast

Episode 193: Mentors & Markets: How to Succeed in Real Estate with Steven Andrews

Date: September 16, 2024
Host: Joe Jensen
Guest: Steven Andrews (Founder, Sorex Consulting & Realty Management Group)

Episode Overview

This episode features Steven Andrews, a seasoned real estate investor, entrepreneur, and founder of Sorex Consulting and Realty Management Group. Steven shares his journey from humble beginnings and debt to managing nearly 300 units with a lean team. The central themes: the importance of mentorship, leveraging technology for efficiency, scaling with a strategic and value-driven mindset, and maintaining strong relationships in real estate. He also discusses his bestselling book, “The New American Dream,” and his commitment to empowering new investors, including a generous half-million-dollar giveaway to inspire others.

Key Discussion Points & Insights

1. Steven's Real Estate Journey — From Debt to Scale

• Early Inspiration: Grew up in a blue-collar family, learned work ethic and values.
• College Experience (01:38): Took a real estate class at High Point University, got exposed to profitability concepts through hands-on simulations.
• The Initial Struggle: Graduated with $75k in debt and a $45k salary, felt ill-equipped due to lack of money and connections.
  Quote:

  “I knew I didn’t have a lot of money. And so I was scared to get into it. … Just the normal things that your brain tries to play tricks on you.” [02:19 — Steven]

• Mentorship Spark: Found mentor Joel through a parental connection. Joel required Steven to read Building Wealth by Russell Whitney before meeting.
  Quote:

  "Be consistent, be persistent, and go after your dreams…" [04:44 — Steven]

2. The Power of Mentorship

• How He Found His Mentor (04:16): Steven’s dad connected him with Joel, a veteran landlord.
• Adding Value to the Mentor:
  • Bought properties from Joel as he downsized; Joel sold directly, avoiding MLS.
  • Steven brought tech and efficiency updates to Joel’s traditional processes. Quote:

  “A lot of people that have been in this business for a long time…are looking for almost themselves in somebody that might have been 20, 30 years ago.” [08:17 — Steven]

• Enduring Relationship: Still in weekly contact, crediting his mentor with teaching practical, real-world lessons not found in books.
  Quote:

  “Have a mentor because they've been there before you….Some of this stuff, you need that real-life experience from a mentor or you have to live it yourself.” [06:32 — Steven]

3. Leveraging Technology for Growth

• Tech Tools: Shifted management from “old-school” (cash, paper leases) to digital platforms “rent ready,” Facebook Marketplace, and background-check apps.
  Quote:

  “There’s so many different platforms out there that really almost becomes an employee of your company….” [10:24 — Steven]

• Portfolio Overview (300 units):
  • Clusters properties within four NC counties, reachable within 30min.
  • Two virtual assistants handle day-to-day; Steven controls finances.
    Quote:

  “I have processes in place…for every scenario that I’ve ever been a part of, good or bad.” [11:53 — Steven]

• Efficiency Hacks:
  • All service requests through the app, never by phone.
  • Defined tenant standards: strong credit, income verification, no recent evictions, third-party references.

4. Scaling Strategies & Niche Focus

• Clustered Portfolio (21:34): Specializes in single-family homes, small multifamily (duplex, triplex, quadplex), and apartments under 10 units, all geographically clustered.
  Quote:

  “You want to cluster properties together because…now you’re not having to find out different rental markets…” [22:13 — Steven]

• Pricing Tactics: Prices rentals just below local luxury apartments ($100–$150 less), attracts quality tenants, reduces vacancy, and allows for pickier vetting.
• Competition & Market Nuance:
  • Focuses on value, not just growth; avoiding “best house on the block” purchases in favor of “worst house on block” for sweat equity.
    Quote:

  “If you buy the best house on the block, there’s not nearly as much upside...If you buy the worst house on the block, you can put sweat equity into it, get a much better deal when you buy it.” [25:31 — Steven]

5. The BRRR Method — Then and Now

• Still Working in Today’s Market? (29:20):
  • Yes, but with higher selectivity due to current market conditions and competition.
  • Emphasizes creativity, direct-to-owner deals, and flexibility. Quote:

  "Real estate’s the only thing in the world where you can buy using someone else’s money—a tenant makes your mortgage payment…” [30:39 — Steven]

6. Flipping vs. Holding — Decision Criteria

• Decision Rule (41:07):
  • If selling yields equivalent to 5–7 years of net cash flow, he’ll flip.
  • Otherwise, holds for ongoing rental income and appreciation.
    Quote:

  "If I can get my return back 5 to 7 years, I’m going to get a bigger return at the 10-year mark…" [42:29 — Steven]

7. Mindset, Relationships, and Giving Back

• Relationships Over Transactions:
  • Treat tenants and sellers as people, not numbers—“Still act like a small company.”
  • Real estate is ultimately a relationship business; authentic connections lead to off-market deals.
• Giving Back – The Book & Giveaway (35:18):
  • Published “The New American Dream.”
  • Running monthly $1,000 and January $500,000 giveaways via sorexconsulting.com—aims to spark new investors’ journeys.
    Quote:

  "I want to empower people…when I first got into this business, I didn’t have money…" [36:33 — Steven]

Notable Quotes & Memorable Moments

• On Breaking Through Fear

  "Don’t let your brain play tricks on you and discourage you from doing this…" [52:04 — Steven]

• On Technology and Scaling

  “If you utilize the technology in your favor, you don’t have to have a ton of people on payroll…” [10:57 — Steven]

• On Picking the Right Tenants

  "Your rental references cannot be a family member…Your family’s always going to talk good about you, right?” [16:50 — Steven]

• On Buying for Value, Not Ego

  “Don’t just buy a property just to say I own rental property, make sure it makes your money.” [45:05 — Steven]

• On Work-Life Balance & Motivation

  “I don’t live to work, but I work to live…the one thing that you cannot buy more of in life is time.” [50:06 — Steven]

Timestamps for Key Segments

• Steven’s Background/First Steps: 01:38–04:16
• Finding and adding value to a Mentor: 04:16–09:22
• Leveraging Tech for Property Management: 09:22–11:53
• Portfolio Scale and Team Structure: 11:53–15:33
• Screening Tenants and Reducing Turnover: 16:35–20:13
• Clustering Properties for Efficiency: 21:34–24:44
• Scaling via Buying Distressed Properties (BRRR): 25:31–29:20
• BRRR in Today’s Market: 29:20–33:13
• Relationships, Acting Small, and Authenticity: 34:20–35:26
• Book, Courses & Giveaway: 35:18–38:46
• Flipping vs. Holding Decision: 41:07–43:15
• Expensive Mistakes (Maintenance): 48:26–49:46
• Final Advice – Mindset and Action: 52:04

Steven’s Top Recommendations

• Book: Building Wealth by Russell Whitney — “A game-changer. … Those same principles are still good to this day.” [46:57 — Steven]
• Invest in Relationships: Local mentors and authentic connections trump textbooks for boots-on-the-ground knowledge.

How to Connect with Steven Andrews

• Website: www.sorexconsulting.com
  • Book, courses, giveaway details, and free resources.
• Instagram: @sorex_consulting
• Facebook: sorexconsulting
• Giveaway: shop.sorexconsulting.com (monthly and $500,000 grand prize)

Concluding Thought

Steven:

“Some of the greatest blessings in life is when you embrace the uncomfortableness of your comfort zone. Getting out of your comfort zone, you have some great blessings come your way if you do that.” [52:04]

Host Reminder:

“…dream big and act now.” [52:29 — Joe Jensen]

For more details and resources, check the show notes or connect with Steven through his platforms.