Podcast Summary: Real Estate Rookie – Episode 596: From a $35,000 Salary to Quitting with 11 Rentals

Release Date: August 4, 2025

Introduction

In Episode 596 of the Real Estate Rookie podcast, hosts Ashley Kerr and Tony J. Robinson sit down with Matt Krueger, a successful real estate investor who transitioned from a modest salary to owning 11 rental properties, ultimately leading to him quitting his day job to focus solely on real estate. This episode delves into Matt's inspiring journey, offering both motivational insights and practical strategies for aspiring real estate investors.

Early Life and Pre-Real Estate Career

Matt Krueger begins by sharing his background before entering the real estate market:

• Educational Path: He attended a conservative Baptist college with the intention of becoming a youth pastor. [01:04]

• Initial Career: Realizing that the pastoral path wasn't financially viable, Matt took up a job at Sprint, a cellular retail store, earning approximately $35,000 annually. His wife worked as a veterinary technician, making around $14 per hour. They lived in a one-bedroom apartment in Iowa, struggling to make ends meet. [01:04] - [02:05]

Catalyst for Real Estate Investing

The turning point in Matt's life came through his in-laws, who were already successful real estate investors:

• Influential Mentorship: His retired in-laws had transitioned from their jobs as meat cutters to full-time real estate investors, owning multiple rental properties. Witnessing their success ignited Matt's desire to pursue real estate. [02:13]

• Inspirational Moment: Observing his father-in-law enjoying a financially free lifestyle inspired Matt to seek a similar path for himself and his family. [02:13]

Building the First Deal

Matt recounts the process of acquiring his first property:

• Financial Constraints: With limited savings and a modest income, Matt and his wife sought affordable housing options. They found a fixer-upper priced at $90,000, well below their $130,000 loan approval limit. [06:00]

• Financing Strategies:

  • First-Time Homebuyer Credit: They acquired a $1,000 credit through a local sponsorship, significantly reducing their closing costs. [07:53]
  • Negotiating Closing Costs: By offering over-asking prices, they convinced the seller to cover $2,000 of their closing expenses, bringing their out-of-pocket costs to approximately $2,500. [07:53]

• Renovation and Transition: After renovating the property themselves, Matt and his wife moved out and rented it for $1,200 monthly against a $610 mortgage payment, yielding a positive cash flow of $590. [11:11] - [12:59]

Notable Quote:

"We moved into it as tenant landlords, saving our rental income to fund our next purchase." – Matt Krueger [07:53]

Scaling the Portfolio

Over the next seven years, Matt systematically expanded his real estate portfolio:

• Investment Strategy:

  • Conventional Loans: Utilized 3% down conventional loans by treating each new purchase as their primary residence.
  • Reinvestment of Cash Flow: Allocated rental income into a separate savings account to fund subsequent down payments and renovations. [14:21]

• Buying Criteria:

  • Property Selection: Focused on single-family homes in mid-tier neighborhoods priced between $130,000 to $225,000, requiring cosmetic upgrades but not extensive renovations. [16:20]
  • Persistent Deal Sourcing: Leveraged local realtors and consistently scoured platforms like Zillow to secure deals. [17:29]

• Operational Efficiency:

  • Self-Management: Managed properties personally, utilizing software like Hospitable to automate tasks and minimize time investment to 2-5 hours weekly. [38:09]

Notable Quote:

"We were consistently putting our cash flow into savings, allowing us to fund each new purchase without relying on our day jobs." – Matt Krueger [14:21]

Transition to Short-Term Rentals

The introduction of short-term rentals (STRs) significantly boosted Matt's cash flow:

• Inspiration from Influencers: Influenced by real estate personalities like Michael Elefonte, Matt ventured into STRs, purchasing properties in downtown Des Moines capable of housing larger groups. [25:31]

• Financial Impact:

  • High Returns: One STR property generated $70,000 in its first year, translating to $2,500 monthly cash flow. Subsequent purchases continued this trend, with multiple properties yielding over $100,000 annually. [25:31]

Notable Quote:

"Short-term rentals are not passive like long-term rentals, but the cash flow is four to six times greater." – Matt Krueger [25:31]

Leaving the Day Job

Matt shares the pivotal moment when he decided to commit to real estate full-time:

• Mentorship and Networking: Attending a BiggerPockets Conference in Newport Beach provided the decisive push. A conversation with a full-time investor highlighted the enhanced focus and growth potential achievable by dedicating oneself entirely to real estate. [31:49]

• Commitment Leap: Armed with proof of sufficient cash flow and lender approval based on rental income, Matt resigned from his job immediately after closing his second STR. [31:49]

Notable Quote:

"Once you get over the fear factor and experience the freedom of doing your own thing, it's something you never want to go back from." – Matt Krueger [37:12]

Operational Management and Current Strategy

Currently, Matt manages his portfolio efficiently while maintaining a balanced lifestyle:

• Portfolio Composition: Owns 11 properties, with 7-8 being long-term rentals and 3 being short-term rentals. All properties are within a manageable 30-minute radius, except for a fourplex located two and a half hours away. [25:31]

• Management Tools: Utilizes property management software like Hospitable for automation and employs local cleaners and maintenance professionals to handle day-to-day operations. [38:09]

• Financial Practices:

  • Equity Building: Focuses on maintaining at least a 50% or lower debt-to-equity ratio.
  • Leveraging Equity: Uses HELOCs and cash-out refinances to fund new investments and pay off high-interest debts. [23:17]

Notable Quote:

"Our goal has been to keep our equity at least 50% and to reinvest wherever possible to grow our portfolio sustainably." – Matt Krueger [23:17]

Conclusion and Key Takeaways

Matt Krueger's journey from a $35,000 salary to owning 11 rental properties exemplifies strategic planning, persistent effort, and the effective use of available resources. Key lessons from his story include:

1. Leverage Mentorship: Surround yourself with experienced investors who can provide guidance and inspiration.

2. Financial Discipline: Reinvest rental income diligently to fund subsequent investments.

3. Adaptability: Transitioning to higher-yielding strategies like short-term rentals can accelerate portfolio growth.

4. Persistence: Consistent deal sourcing and overcoming financing challenges are crucial for scaling.

5. Work-Life Balance: Effective property management allows for financial freedom without sacrificing personal time.

Notable Quote:

"The worst-case scenario is that it doesn't work, and you go back to where you were. But moving forward holds so much greater potential." – Matt Krueger [36:00]

Connect with Matt Krueger

For more insights into Matt's real estate journey, listeners can follow him on social media under the handle @rentalcashflow or search for Matt Krueger – Rental Cash Flow across all platforms.

Disclaimer: The podcast episode includes promotional segments for various sponsors. These sections have been excluded from this summary to focus solely on the content-driven aspects of Matt's real estate journey.