Podcast Summary: Real Estate Rookie – Episode: Playing the Real Estate “Long Game” with 10 “Boring” Rental Properties
Episode Details:
- Title: Playing the Real Estate “Long Game” with 10 “Boring” Rental Properties
- Release Date: April 16, 2025
- Hosts: Ashley Kehr and Tony J. Robinson
- Guest: Zack Stanley
- Description: This episode delves into strategic, long-term real estate investing with guest Zack Stanley. Zack shares his journey from sales to building a substantial rental portfolio, emphasizing the importance of comprehensive deal analysis, financing strategies, and maintaining a patient approach to wealth building.
1. Introduction
The episode kicks off with hosts Ashley Kehr and Tony J. Robinson setting the stage for a deep dive into smart real estate investing. They emphasize the complexity of the real estate market and the importance of understanding what constitutes a good deal tailored to individual portfolios.
Ashley Kehr [00:00]:
"The real estate market can feel like a maze with investors constantly searching for that perfect property to start building wealth."
2. Guest Introduction: Zack Stanley
Zack Stanley joins the podcast as a guest who exemplifies successful transition from traditional sales to real estate investing. With a portfolio of 10 properties, Zack discusses how his background in printer sales provided a solid foundation for his real estate ventures.
Tony J. Robinson [00:15]:
"Our guest today is living proof that mastering deal analysis can literally transform your ability to scale."
Zack Stanley [00:50]:
"I grew up on BiggerPockets, so being here is kind of a full circle moment. I couldn't be a bigger fan of BiggerPockets."
3. Transition from Sales to Real Estate
Zack narrates his journey from mold remediation to printer sales, highlighting the challenges and skills acquired in sales that benefited his real estate career.
Zack Stanley [01:11]:
"My first job out of college was in mold remediation... then I moved to printer sales, which was mentally grueling but built a strong foundation for real estate."
4. Building a Foundation from Sales
Zack emphasizes how his sales experience taught him resilience and effective communication, crucial traits for successful real estate investing.
Zack Stanley [04:03]:
"It gave me some systems and processes to follow, being able to take rejection really well."
Tony J. Robinson [05:59]:
"You have to have a certain level of perseverance and thick skin to handle rejection and adversity."
5. Initial Investment Strategy and Lessons Learned
Zack discusses his early investment strategy, which involved making quick, uninformed purchases based on personal preferences rather than data-driven decisions. This approach led to both successes and significant losses, teaching him the importance of thorough deal analysis.
Zack Stanley [07:46]:
"With my first two properties, I was just throwing a stack of cash at a home... it was straight up blind."
Zack Stanley [24:50]:
"I lost $15,000 last year because I overdid a flip property... it was by far the best home in the neighborhood, but it didn’t fit the market."
6. Comprehensive Deal Analysis
A significant portion of the conversation revolves around the importance of comprehensive deal analysis. Zack outlines key metrics such as vacancy rates and rental comps, advising rookies to rely on accurate data rather than hyper-conservative estimates that can deter investment opportunities.
Zack Stanley [21:44]:
"Make sure those rental comps are correct because that could make or break you."
Zack Stanley [20:07]:
"Rookies are scaring themselves out of deals with hyper-conservative numbers like 10-15% vacancy rates when the actual rates are much lower."
7. Avoiding Common Rookie Mistakes
Zack identifies common pitfalls for new investors, such as overestimating expenses and underestimating rental income. He advises maintaining realistic and market-aligned financial projections to avoid unnecessarily passing on profitable deals.
Zack Stanley [20:07]:
"Rookies are putting in 10, 15% for vacancy when it's actually 5%... putting 10-12% on capital expenditures for a brand new home."
8. Scaling the Portfolio and Long-Term Strategy
Zack outlines his current portfolio of 10 single-family homes, detailing his focus on long-term wealth building rather than immediate cash flow. He treats each property like an index fund, aiming for steady appreciation and manageable cash flow.
Zack Stanley [25:33]:
"I have 10 single-family homes right now... I'm going after this long-term grind, this 20, 30-year type of thing."
Zack Stanley [29:00]:
"I'm treating the homes like really good bank accounts and I want to put them in good bank accounts. I'm not looking for home runs."
9. Financing Strategies
Zack shares his multifaceted approach to financing his investments, which includes leveraging his active income as a top agent, building relationships with commercial bankers, and utilizing both traditional and creative financing methods.
Zack Stanley [37:11]:
"I’m able to fund these deals with a lot of active income... I developed a relationship with a commercial banker who knows my goals and vision."
Zack Stanley [38:41]:
"Start by talking to someone local, someone where you can show up and show your face... build relationships with a variety of lenders."
10. New Builds and Development
Zack discusses his strategy of building new homes rather than flipping, emphasizing the precision and control it offers over costs and outcomes. This approach aligns with his long-term investment goals and market understanding.
Zack Stanley [43:48]:
"I like new builds over flips because I can almost calculate to a tee how much money I'm going to make."
Zack Stanley [44:17]:
"I'm building a home for myself that I’m gonna have five or six hundred thousand dollars of equity in it in two years."
11. Advice for Rookies
Zack and the hosts offer valuable advice for new investors, stressing the importance of accurate data analysis, building strong relationships with professionals, and maintaining a patient, long-term perspective on investment.
Tony J. Robinson [32:08]:
"Don't put so much pressure on the cash flow from your small portfolio to completely replace what you were making for your day job."
Ashley Kerr [25:23]:
"Understand who your market is and what your tenants need. Even a high-end property won't rent for an unaffordable amount in the local market."
12. Conclusion
The episode wraps up with Zack sharing his contact information for those interested in his services and further emphasizing the importance of strategic, data-driven investing. The hosts thank Zack for his insightful contributions and encourage listeners to apply his lessons to their own real estate journeys.
Zack Stanley [45:50]:
"You can text me, call me at 479-466-7600, or find me on LinkedIn and Instagram as Zack Stanley."
Key Takeaways:
- Foundation Matters: Sales experience equips investors with resilience and communication skills essential for real estate success.
- Data-Driven Decisions: Comprehensive deal analysis, including accurate vacancy rates and rental comps, is crucial to avoid missed opportunities and losses.
- Long-Term Focus: Building a portfolio with a long-term perspective ensures steady wealth accumulation and mitigates the pressure of immediate cash flow needs.
- Financing Flexibility: Developing relationships with various types of lenders expands financing options and supports portfolio growth.
- Strategic Development: Opting for new builds over flips can provide better control over costs and align with long-term investment goals.
- Rookie Advice: Avoid over-conservatism in financial projections, understand the local market deeply, and build strong professional relationships.
This episode serves as a comprehensive guide for novice investors aiming to build a stable and profitable real estate portfolio through disciplined, informed strategies and a patient, long-term mindset.