B (2:03)

Now, if I push back on that.

A (2:04)

Please.

B (2:05)

I'm looking around and I would love to buy a house.

A (2:08)

Yeah.

B (2:08)

But it seems like renting is so much cheaper.

A (2:11)

Yeah. That.

B (2:11)

Why would I spend. Spend. Let's just call it just for even numbers. $10,000 a month on a mortgage, property taxes, insurance. When I could rent the identical home for $5,200 a month.

A (2:22)

Yeah. This goes back to perspective, right? If you were to own that house for three years, 100%, I would not, I would not buy a house if you're not living there for two years, one year, probably not. But if you're going to hold that, own that house for five years, seven years, 10 years, 20 years, you're going to make some. So much more than $10,000 a month on average over that time period. Because that house that you bought for whatever call it a million dollars is in 10 years from now is going to be worth, call it two million dollars, maybe two and a half million, maybe three. Like, prices are going up, especially because we have just a massive housing shortage in America. So when you look at over a long period of time, this isn't getting better, it's getting worse. For affordability.

C (3:01)

Do you think that more houses will be built? Do you think the regulatory environment is going to get a little bit more friendly to real estate developers and that can kind of solve that issue a little bit? Think that we're only going to get more tight, there's going to be more regulations and it's going to be harder to build new homes.

A (3:16)

Yeah. I mean, the government will have to do something. Right. Like, here's the problem in a nutshell. What happened? Great Recession hit, everyone lost. You know, a lot of bad things happened. They stopped building from like 2000, 8, 9, 10, 11, 12. Nobody was building anything. They started picking back up again. 12, 13, 14, 15 started, you know, building, which is great. But when you're not building and more and more people are either in coming to America and buying houses and, you know, people are having kids and kids are growing up. There became a housing shortage. But there. What, what the second. I don't know what you call the second Great Recession, you know, like 2,000, you know, we'll call it Covid. Sure. Covid happened. Everyone stopped building again. And it hasn't Picked back up again. The only building being done is at the top of the market. In fact, Wall Street Journal had an article just out the other day. It just said, there's a lot of apartments available. They're just for the rich people. There's almost nothing being built for the average American right now. So what does that mean again? Supply and demand. So to answer your question, it's a tremendous problem. The government has to do something. Whether that. And we can debate this. And the government, they don't know what they're doing. So they can either release, you know, reduce regulation and try to allow more building, which I don't see that happening. They can try to find a creative way to get more people into homes, like California is doing right now with the ADUs, which is really fascinating. San Diego especially is wild right now. And you could do that, or the government could just start subsidizing Americans rent. And I think it's going to be a combination of all three.

B (4:40)

That would be insane if the government subsidizes people's rents, because that just means landlords are going to raise their prices 100%.

A (4:45)

Yeah. So people. Yeah, people are like, are you afraid of rent control? Are you afraid of like. Or, you know, like the government stepping in? Would you do section eight, all those things? All the answers? Yeah, of course. I would love to have that. Like, I don't mind regulation. It just makes me richer. And what I mean by that is the money. The more the money gets printed and pumped into the economy, landlords are usually ones that end up with the money. It's business owners, and landlords get that money because it goes to the tenant. Fine. They pay the rent. Landlords raise the rent, we get more. Yeah. It doesn't solve the problem, but that's how America likes to sell.

C (5:13)

That's interesting because during COVID when they printed all the money, gave away all of this free money, Right?

A (5:17)

Yeah.

C (5:18)

Like the people that received the actual stimulus checks and this and that, that just goes away. Like that flow right out. You see, the wealthiest people during that time period gained the most amount of wealth, like by crazy magnitudes.

A (5:29)

Yeah. Yeah. My wealth grew by tens of millions of dollars during COVID because my properties that I owned just went up in value because the rents went up, because people. Yeah, it just. It was a. It was a weird time. There was so much money in the economy.

B (5:42)

Yeah. So there's the argument that home values really aren't going up. It's simply that the United States government is printing more money. What are your Thoughts on that?

A (5:50)

It's probably true. Like, in other words, if I had. Yeah, my house is worth a million dollars today. It's gonna be worth $2 million in 10 years. Okay, that's probably reasonable to say. But also, the gallon of milk is worth. Was four. Today is gonna be eight then. So in other words. Yeah, inflation is causing the housing to go up, that's for sure. But it goes back to the original point of should you buy a house? Well, if you don't own the house, then now you still have nothing 10 years from now, and your milk is still $8 a gallon. So, like, you can. You can argue the. Whether it's right or wrong, or you can argue whether what's. Is it inflation? Is it just supply and demand? But regardless, if you own the asset, then you're playing with the game. You're not fighting against it and your payment is fixed.

C (6:29)

Whereas people that rent, their payment basically is at the whims of the market.

A (6:33)

Yeah, I mean, it's fixed as long. Yeah, for as long as you get a good mortgage, which is super important, you get a fixed mortgage instead of a variable, which most people are pretty good with that. Taxes and insurance, though, can kill people a little bit. You know, if you're. If you're. Whatever your taxes are at $10,000 a year, and then it bumps it up to $20,000 a year, your payments going up by, you know, almost $1,000 a month. That's real. But it's not, you know, it's not going up by thousands of dollars a month. You're not going to be completely hosed if you own a house with a fixed mortgage. Yeah.

B (7:01)

Now, for those unfamiliar with you and what you do, can you give us a bit of a backstory of how you got started in real estate?

A (7:06)

Sure.

B (7:06)

And in essence, almost what qualifies you to talk about this.

A (7:09)

Yeah. All right. It begins with Cold Stone creamer. You guys have that ice cream? Cold Stone, Yeah. Great. Ice cream, right. So I was singing for Tips. Literally. They don't do that anymore, do they? Do they sing for tips?

C (7:17)

I didn't get times I didn't get.

A (7:19)

Sung to when I went there, dude. Yeah.

B (7:20)

Because you don't tip.

A (7:21)

Yeah, that's why. So back in the day, you work at Cold Stone and you sing when somebody puts a tip, like, you know, thank you for your dollar. Listen to us holler. I don't know why I remember that one. So you sing for tips, and that was my job. I was making $8 an hour plus tips, averaged like 15 bucks an hour. And I decided to rent a like four bedroom apartment. And then I rented out each of the bedrooms to just guys from the local college, which is, you know, an experience in itself. But all of a sudden I was living for free. And so that's how I got into real estate. So just people know I did not come from money. My dad's a meat cutter, my mom did daycare in my house. Like we were very like blue collar, lower middle class. But I discovered like, oh, this is cool. So anyway, so I did that. I ended up buying a house, just like a house. And then rented out the bedrooms to a bunch of buddies, did the same thing, live for free. Then I bought a duplex. That was cool. Lived in one half, rent out the other.

C (8:11)

Where'd you get the idea to do that?

A (8:13)

It was kind of an accident, actually. I was bowling with some friends and one of the persons I was bowling with, I said, hey, do you have a place I can rent? And she's like, don't rent, just buy. And I was like, but that's crazy. I'm 18 or 19 years old. Like, why would. And they're like, no, don't, just trust me. She's like, just trust me. Buy, don't rent. So I did. And yeah, that's literally where the idea came from. And yeah, and in all those houses that I then bought and rents out the bedrooms, not only did I make cash flow, but, but like they all went up in value over time. In fact, one of them I just sold like the second, that first duplex I just sold last year and I made like about 100 grand over a decade, which is not a ton of money, but I only paid 80,000 for the property. And so anyway, that's how I got into it is just scrappy, just trying. So we went from 1 to 2, 2 to 4, 4 to 10, 25. And say we're at a little over 13,000 across about 20 different states. There's a, there's a lot of in between their story, but that's the, that's the beginning.

B (9:06)

And what about your involvement with Bigger Pockets? Because that's how I found you.

A (9:09)

Yeah, Bigger Pockets. Bigger Pockets. So I remember my very first property I ever had that was in that house. And that's when I decided, like, I'm going to be a real estate guy, I'm going to buy real estate. So I remember telling my dad I was actually studying for the lsat. You know the lsat, the law school entrance test. Right. I'm studying for it. And I tell my dad, hey, I'm actually not going to go to law school. I changed my mind. I'm going to be a real estate investor. And he's like, that's, that's crazy. Like, why would, like, secure job, all that? And he goes, what are you going to do, Brandon, if the tenant doesn't pay rent? I was like, oh, shoot, I don't know. I was like, you're right. Never mind. And I almost changed my mind, but what I did, I went to Google. I typed in. I don't think it was Google Dogpile, maybe. I'm like, whatever. That old. Before Google, everyone used maybe Yahoo, what to do when tenants don't pay rent. And this little tiny blog forum called BiggerPockets Pops Up. And I don't remember what the answer was. I remember I printed it out, and I've had it for years. It's somewhere in a file here, but I printed it out. But what it meant was there were answers to all those, like, problems. Like, when people are like, yeah, but you shouldn't do real estate investing because of abc. Every ABC out there, there is an answer from somebody who overcame that and then made millions and millions of dollars. So it, like, expanded my mind to say, okay, well, maybe I can do this. So that's what got me into bigger pockets. Actually, I was one of the very first signups on their website. I mean, it was basically just Josh Dworkin running in his basement. And, yeah, I, I, I, I jumped in and started volunteering to edit blog posts for him. I was like, I can, I can help out. Let me just edit blog posts. I pretended English and grammar, which I was not. That led to the podcast. And so I started the podcast alongside Josh, and then the podcast just took off and became the biggest real estate podcast. And, like, we were number two in the business category for almost a decade. That's incredible. Dave Ramsey. Yes. And I was like, can never beat Dave.

B (10:52)

That is so cool. So what's your most difficult deal that you've ever done so far across those 13,000 units?

A (10:57)

Oh, man. I'll give you a small example. And then a larger example. Small example. I buy this house, I'm watching all the flipping shows. You know the flipping TV shows are always on, right? Yeah. So I'm watching the flipping shows, and I'm like, I'm going to flip this house, and this, this giant duplex comes for sale. It's like 4,000 square feet, top, bottom, duplex. I mean, there's, like, literal, like, blood spatters on the ceiling from, like, shooting up, like, drugs. It was wild, but, like, I mean, nasty house, but good bones, good structure, amazing view of the town that I lived in. And I get the thing for, like, 45 grand. I'm like, this is gonna be. I'm gonna make so much money. I'm like, I'm gonna put maybe 40 into it. I'm gonna sell it for 200. I'm gonna make a hundred grand. Like, that was my thinking going into it. I go to a hard money lender, which. These are companies that lend money to house flippers. I go to a hard money lender and, like, I'd worked with before. And I knew he's like, yeah, no chance. I'm not gonna lend that. And I was like, but. But here's all my numbers. He's like, no, it's gonna be way more expensive than that. It's not worth that much money, you know? My answer was to him, like, I didn't say this literally, but in my head, I was like, screw you, man. Watch me. And I wouldn't, like, talk to, like, 20 different lenders. Found one guy willing to do it. I go in there. It didn't take 40 grand to fix up the property. It took more like 80 grand to fix the property up. So now I'm in for, like 120. And I was. I did most of the work myself. A whole year of my life was working on this project. My wife and I would work every day. The thing I put on the market for 180 instead of 200. Okay, we'll go a little cheaper. It doesn't sell at 180. Not 170, not 160, not 150, not 140, not 130, not 120. 1:15 sells that. So I lose money on this deal. I mean, I lose probably 20 grand. Call it. And that was the hardest. I mean, it was a year of my entire life. And to lose money, I could have literally laid on the couch and done nothing and made more money watching, like, soap operas, like. But the reason I love that story is had I kept it a duplex, it would have. Cash flowed over $1,000 a month back then. It would be probably 2 or 3,000amonth today. Had I kept it as a duplex, I wouldn't have done as much work. It would have been probably more like, you know, 20, 30, $40,000 worth of work. It would've been a great duplex. Today, here we are, eight, nine years after I sold that maybe 10 years after I sold that property. It's probably worth 700,000. No. Yeah. And so the lesson learned is like, yeah, flipping's fun. It's cool to take a house, flip it, make some money. But if you just hang on to real estate, just hang on, it is incredibly hard to live lose if you can just hold on. And I could have hold, I could have held on just fine. So that was the hardest deal I've done there. Then I got a $72 million apartment complex in Texas that like they, you know, we were making maybe a million dollars in cash flow and then the government's just like, oh, by the way, taxes are now a million dollars higher. So it's just like, it's not quite a million, but it just wipes out so much cash flow. So now we're just like, okay, well we got to figure this out. So now we're looking at doing midterm rentals, like traveling nurse stuff inside of it, maybe doing some breaking up apartments into like co living, sort of like rent by the room we call micro apartments, like trying to figure out how, okay, when the taxes go up, how do we deal with it? How do we figure it out? And again, 20 years from now, not worried about that property. But right now.

B (13:57)

So any challenge, is there any recourse on that where you could go and say, actually we don't think our property should be assessed at this?

A (14:03)

Yeah, it's a great question. And yeah, everybody can do this. Whether it's your primary residence, whether it's investment property, you can challenge a tax assessment for sure. And we did. And you fight for it. Every area's got a little different process and we did fight for it and I think we got a little bit reduction on that. Insurance also went up the same time and that sucks. But that's, you know, that's just a, that's the game we're playing.

B (14:21)

I'm curious because I get these in the mail all the time, these mailers that say, we think you're overpaying on your property taxes. Hire us that we could fight it and bring it down and we'll get a percentage of the savings.

A (14:32)

Yeah.

B (14:32)

Is that a scam?

A (14:34)

That's a great question. I get them as well. I've never hired one of them. I would guess this. It's probably not a scam. It's probably just a whole, like, it's probably a whole lot easier than people think to do it and so they need to go do themselves kind of like that business filing thing. That right now everyone's supposed to do. You know what I'm talking about? Like, right now there's some, like. I mean, obviously people are listening to this in the future, but there's some, like, we have to file some business thing. The government change. It's like, one paper. It's free to do it online. You can do it in five minutes. But there's, like, a ton of companies right now that'll do it for you for 500 bucks. Yes. And it's like, don't do that.

B (15:05)

It's a horrible scam. So, so get this. So I. Our. Our accountant emailed us saying, hey, you gotta fill this out by, like, January 15th.

A (15:12)

Yep.

B (15:12)

Fine. I Google it, I go through the form, and I realize at the very end it says, perfect, submit this for $179. And I realized, wait a second. I clicked on the first link. It was a sponsored link. And this company has the same website, and they charge you $180. And then I just went back and found the actual website. Did it for free.

A (15:35)

Yeah. Isn't that wild?

B (15:36)

The same amount of time I want.

C (15:38)

To make sure I sign this form.

A (15:39)

Yeah.

C (15:39)

I don't know what this form is, but does it save money? What is the.

A (15:42)

I feel like.

B (15:43)

Yeah, so all it is is. It's the government's trying to collect information from small businesses who make under $5 million a year for an LLC or an S corporation. It's. It's basically just a statement of who you are, how you make your money.

C (15:55)

But it doesn't make you any money. I think I. I remember doing that.

A (15:58)

Yeah, yeah, yeah, yeah.

C (15:59)

Everyone knows I make less than $5 million a year.

B (16:02)

You just got called out.

A (16:04)

Okay. No, it's just in one of your companies. Your other companies are. This is in your, like, hair care product. Yeah.

B (16:08)

Okay.

C (16:08)

What's interesting is every time I hear someone talk about real estate, I'm like, this sounds easy. It sounds very doable. And then I always take it to the nth degree.

A (16:15)

Yeah.

C (16:15)

I'm like, okay, if I were to go all in on real estate, what does that look like? And then I start getting nervous because I'm like, if I buy all of my real estate in Las Vegas, what's my, like, meteor plan? If. Let's just say Lake Mead dries up and then they can't source water, what happens to Las Vegas? If you buy all in California and then there's another California wildfire, there's an earthquake. Or if you buy all in, like, the Midwest and you have a Tornado. Or what if like government then in 20 years is like, you know what, we are going to develop ultra high density living and it's going to be super cheap and super affordable because maybe we actually have like a government that's willing to do something like that and then everyone moves into that and then there's no reason for real estate. Maybe they deregulate and then all of these people go and they build all of these super cheap, actual affordable homes that people can move into rather than mansions that everyone, everyone's been developing over the past 20 years. Like, what is the, the I would say macro threat to being a real estate investor?

A (17:09)

Well, let me first ask you this. Podcasting. When I think about going all in on podcasting and YouTube, I'm like, oh, but what if AI takes my place in five years from now and there's no longer podcasts and YouTube anymore? What if my entire career that I build is just in the toilet in five years because I, because I went into something and then it got disrupted? That could happen. Right? But it's not stopping you guys from doing this. It's not stopping me from doing it.

C (17:29)

Well, it depends because like right now podcasting is kind of like the thing for like, that's like our job, you know, and we can pivot. But something like real estate, you're using your capital to then buy something that in the event of, you know, this meteorite plan or whatever could be completely worthless.

A (17:44)

Sure.

C (17:45)

And so there's so many other avenues. Like you could just invest in like international index funds like Grant loves to do to get 3% return or you can buy, you know, like US based index funds. Like there's so many different choices and real estate sounds very appetizing. But then I'm also concerned because that is also. You can be subjected to macroeconomic things that just happen.

A (18:02)

For sure. I'm just trying to alleviate the fear. The fear decision or the decision making based on fear of saying, hey, what if something goes wrong? Maybe I shouldn't do it because of that. Right. One of my favorite lines, I don't know where I first heard it, but no risk it. No biscuit. Like if you don't risk, you're not going to get the rewards. Right. Real estate, like, yeah, you could go and get 3% returns and some like very ultra safe thing, that's fine. And if you are ultra rich or you have a lot of money and you're not in the building phase, that's. That maybe is fine. But for most people when they're getting into real estate investing. Like in our. Like that are listening to the show, they're not sitting on $10 million of capital that just want, like, what do I do with this money? Right. They're probably sitting on 50 grand. Okay, 50 grand at 3% per year. They're never getting rich off that. Right. So you have to take risk in order to get the biscuit, if that makes sense. So. So on one regard, there's that there is diversification, though, of course. Like, I don't like putting all my eggs in one real estate basket. Like location or something. Yeah, different location. I mean, we're in 20 states. I'm across different areas. Even, like, forget Opendoor Capital, which is my. My large company. I'm also doing my own personal, like, real estate. I have a few small properties here and there. I got a couple of condos here in Maui that I do on Airbnb. I've got a property I just closed, actually, what, two days ago in Florida that I'm going to do rent by the room, which is a cool strategy we can maybe talk about. I got another one, Atlanta, I'm closing on. So I've got different areas with different strategies now. You know, the more you diversify, the less expertise you have. So there's a danger there. We got to be careful not to get too wild and crazy, because the money in real estate today is in, like, being world class. The. Like, if you're not world class, I would say the same thing with podcasting and YouTube and all that. Like, you gotta be world class. You can't just put up a video and hope to get a million views. You can't just buy a house and hope to make a ton of money. Like, if you're not good, then you're going to struggle. Mediocre. Mediocrity doesn't really have a place anymore in the business world in America.

B (19:46)

How do you find a good deal?

A (19:48)

Ooh. All right, good deal. First of all, we gotta define what a good deal is. Most people, when I like a newbie, comes to me and they're like, I want to find a good deal. What is a good deal? Well, I mean, just something that makes me money. Well, how much? I want to make a thousand dollars a month. Okay. Would you. If you put a million dollars into the deal. Let me ask you this. If you put them. If you invested a million dollars into a deal and you made a thousand dollars a month, is that a good deal? Horrible. Yeah. Because of what, what? 1.2% return on your money? That's terrible. Might as well stick it somewhere else. What if you put a thousand dollars into a deal and you made $1,000 a month? Fantastic. That's a fantastic deal. Right? So we have to define the terms. Like, what do you mean by good deal? So I want to say, hey, I want like, personally, I like to get. You call it 8 to 12% cash on cash return, which means in year one, I'm gonna get back 8 to 12% of whatever I invested just in year one. That doesn't account for the future. If you want to go like long term over a seven year hold, let's say I want to maybe say, hey, I want 15% per year of my money, whether you calculate as an irr, which gets a little in the weeds, IRR or average annual return. But I want to get like 15% plus per year. Where'd that number come from? It's double the stock market. It's like roughly, like, that's literally just a rule of thumb. I'm like, well, if I'm going to do the risk of real estate and the work of real estate investing, I want to get an outsized return. I don't want to get 7% over the next 10 years per year, when I could just dump that in the stock market.

B (21:08)

But where do you find that? Because I'm looking all the time, I don't see any deals. In Vegas. Commercial real estate tends to cap out about six and a half percent. When I look at any options that are out there on the market, you either have to do a substantial amount of work to renovate and raise rents, or it's better just not to do that and practically invest in anything else instead.

A (21:30)

Sure, yeah. Real estate does not work like it used to. I mean, this is a big thing. Real estate in 2025 is not real estate in 2020 or 19, 18, 17, whatever. The game has changed because of what we talked about earlier, right? Interest rates are higher, property values are higher. So what do we do? Well, we can just choose to sit it out and just invest somewhere else, and that's fine. That's what some people do. I'm a much bigger fan of this idea of how do we make cash flow work? How do we make a good return in today's market? So that gets to what I call like the fringe of the real estate strategies. Where again, the old days, you find a house, it's listed by a real estate agent In Vegas, it's $280,000. You put 20% down, you make a nice 12% return. On it, everyone wins and you're all happy it doesn't work. Just can't do it. Like your mortgage is higher than what the rent is because rents are not going up right now at the same pace that housing prices are. So we have to say, well, how do we make better cash flow? I'll give you a few examples. I mean, I have a list of like 20 of them, but one of them would be rent. I mentioned earlier, rent by the room. They also call it co Living. There's a company called Pad Split that does this. They're kind of like the Airbnb of the co living. Now this is going to sound wild, but imagine taking a five bedroom house, adding three or four more bedrooms in it. You turn the garage into two bedrooms. You don't, you take a living room and turn it into a bedroom, maybe two bedrooms, and all of a sudden you've got nine bedrooms in this house for maybe 10 grand, 20 grand of work to get. It's pretty simple to put up some simple walls that are just kind of temporary walls. I mean, like they're real walls, but you could remove them later. So now you got nine bedrooms in this house. And that house normally would rent for $2,500 a month and your mortgage would be $2,500 a month. You're just breaking even. So that's not a good deal. But when you can charge now, let's call it $800 a month for nine different bedrooms. What is that? $7,200 a month. And so you just went from 2,500 and break even to 7,200. Now you got to pay some extra expenses. People are going to move out more often. Water, sewer, garbage, all that you got to cover. But you easily can make $1,000 to $2,000 a month on one of these houses. Now, I know people are listening going like, that's insane. Who's going to live in something like that? Half of America will live in something like that. You're single and you make less than $50,000 a year. Like there's a good chance that you would rather pay 800amonth to live in one of those than 1500 dollars a month or 2000 to live in a studio apartment. Does that make sense?

B (23:42)

We had a buddy who did that in Vegas. He stopped doing it.

A (23:45)

Yes.

B (23:46)

They kept having to call the police.

A (23:47)

Yeah, yeah.

C (23:48)

And he wasn't doing Pad Split, and that was in a sketchier part of town.

B (23:52)

But, but he did this. Two different properties rented by the room and the police got Called many times.

C (23:57)

Because I think he had dynamics fires.

B (23:59)

He had three fires.

C (24:00)

Like, I would talk to him and he'd be like, I had another fire. And I'm like, like, what number are you at?

B (24:05)

Yeah, and he's like, the dude just set fire to the room. He just, like, had a breakdown and just lit it on fire.

A (24:11)

So I love stories like this. I call it, I call it like, my uncle invested in real estate. One stories, right? Everyone's got like, yeah, my uncle did. Like, when you, when I tell people I do real estate. Yeah, my uncle invested in real estate once and had three fires, right? Everyone's got that story. My uncle lost his shirt in real estate. I, I, I caution people around the idea of taking anecdotal stories and applying it to principle, right? So I heard this happened. Principle. There are tens of thousands, I would probably argue hundreds of thousands of units in America that are these rent by the room, and by and large they work just fine. And so when you hear the stories, like, when I hear a story of like, yeah, my uncle tried real estate investing ones and, man, the tenant burned down his house and he, you know, stole his wife and like, the whole thing. You're like, well, did your uncle screen for tenants? Did he use like a background check and a criminal check and did he hold him to this stuff? And it's always, I mean, they don't know, but it's. Of course the answer is usually no. It's just they're mediocre landlords or mediocre. I'm not saying you're, I don't know. And sometimes they're just crazy stories. I mean, I, I've, I had a, I have a mobile home park. I think I said this on this, on the show last time. Maybe not. I had a mobile home park where one of the tenants just like, robbed a bank and then just went on the run, like from the feds. Like, yeah, that's a weird story we had. We couldn't evict him as easy because we couldn't find the guy. And it was like, took months to get him out. Those stories will happen. I had another tenant in that same place. She was a prostitute who would advertise her services on like, Craigslist or whatever, and she'd get people to come to her trailer, her mobile home, and they would come there, they would get undressed, they'd get all ready and. And then her boyfriend would come out with a gun and rob him, send him out naked out into the night. And of course they're not going to go to the police with it because, like, they're there to then all the neighbors. Yeah. So, like, it was just a really interesting scam that, that it's actually pretty smart. Like, we have these stories.

B (25:53)

How did they get caught?

A (25:54)

Because they got caught because one of the guys who got in got scammed. He calls a property management company from like a burner phone. He's like, he's like, obviously I'm not going to go to the police with this. I'm not going to say my name. But this is what just happened. You guys should really look into it. So then we had to look into it. We had to tell the police and they started investigating and the whole thing.

C (26:11)

Is there a sting operation?

A (26:12)

I don't think there's a sting. I think they just confronted the lady and her boyfriend and I think that scared him enough to leave and they ended up getting evicted a little while later because they stopped paying rent. I think they just disappeared. And. Yeah, anyway, those stories happen, right? Those happen when you have thousands of units, especially you're going to have those crazy stories. I just, I caution people against the idea of like, there a bad thing happened. Now, are there challenges with a thing like rent by the rim? 100%? There are massive challenges. I'm not saying you should go do that. I don't do much of it. I'm very, very, very little of my portfolio is that way. However, it does work. There are many examples of people who are getting a thousand to $2,000 in cash flow each home and they just learn how to manage correctly. So this is that final point, is every one of the strategies, and I can name a few more, like ADU Development. You build these little ADUs in the backyard. California is leading the way on that. I love it. Assisted living, Residential assisted living. Turning a house into a, you know, almost a rent by the room, but for elderly. Right? Yeah, there's problems with that. Everything I say here. Built to rent communities. I love built to rent. When you build a community of like 5, 10, 20 houses and rent them all out, you can, you can make really good money that way. Every one of these people listening, something pops in their head. He goes, yeah, but this. Yeah, but this. Yeah, but this. And that's hard. Like, oh, man, imagine how difficult it would be to manage like a dozen tenants that living in one house. Yeah, you're right. That would be really hard. You know what's also really hard? Being poor. Right? Like being broke. That's really hard. You know, it's also being like, so, in other words, like, you pick your hard and money is in hard. Like fast money may be the way of saying it. Fast money is in hard. When you can solve a hard challenge, like managing a bunch of tenants in one house, you're gonna make a bunch of money. If you can manage the difficulty of getting licensed to do a residential assisted living in a community, super hard. I got a buddy doing that. He won't like. Every house makes him $15,000 a month in profit when he's done. Yeah, but what about staffing? Yep, that's hard. It's hard to find good staffing. It's hard to be poor. Yeah.

B (28:04)

I'm actually doing an ADU now.

A (28:06)

Are you really la? Yeah. That's awesome. I love.

B (28:08)

I never thought I would put more money in Los Angeles ever. I swore against.

A (28:12)

Which house?

B (28:13)

The one. It's. It's by Somerset.

A (28:15)

Okay. Yeah. Dude, the ADU thing is, I think one of the. You asked the question earlier, should people buy real estate today? And the answer is, yeah, yeah, long term, if you can hang on to it, sure. It's a great idea. ADUs are a way to hang on to it because you can build an ad. What are you spending on yours?

B (28:29)

So I'm spending $200,000amine. I'm able to borrow the entire amount of pledged asset line at 5.26%. And I'm guessing I should be able to make, worst case, a 10% cash on cash return. So I should be able to net 20 grand a year from a $200,000 investment, which, you know, I'm paying $10,000 in interest. So it's basically a free thousand dollars a month.

A (28:52)

Yes.

B (28:52)

Worst case scenario. Best case scenario, I make maybe a 15% cash.

A (28:56)

Cash return. And what's wild now, if you want to maximize that even more, you could potentially Airbnb it. If it's in the right area, in the right legislation. Yeah, you could midterm rental it though. You could. You get a stage like where let's say a normal. A normal ADU might rent for whatever. $2,500, right? Correct. That's cool. But if you put the furniture in there and then you go listed on like furnish finder, you might be able to get 35 to $3,900 for that same unit. Same thing. You maybe cover. Cover a couple of the utilities, but all of a sudden you just jack your rent, your. Your income even higher. And there's other strategies as well. You can do the same thing. You can also add sometimes multiple ADUs now. I mean, people in San Diego are putting like 10, 15, 28 use on one lot. And just property value. I mean, their value of the property goes up, their cash flow goes up. It's. It's a phenomenal strategy. I love that you're doing that.

B (29:42)

Yeah, I'm trying one.

A (29:43)

Yeah, yeah, it goes well.

B (29:44)

I'm doing it on the other place, the duplex I used to live in.

A (29:47)

Yeah.

B (29:47)

Turn that garage into an adu. If that goes well, then I got the place in West LA where I want to do an ADU there.

A (29:53)

Yeah, yeah. That game is strong. That's how Hawaii is surviving. I mean, here in Hawaii, every house pretty much has an adu. That's the only way to make it like this house where I'm at right now, I got an ADU right there. My parents are staying for the month in it. I got another ADU in the front yard, like another studio apartment. I could rent out that 80 you. If my parents weren't there, I could rent that for 3,500amonth, maybe 4,000. I could rent the front unit for 2,000. My only like, my mortgage on this place right now is only like eight. So like I could live almost for free in this house. I could, I could have actually thought about it. This room we're in right here, I was like, I'm going to turn it into an adu. Yeah, I was going to turn that into the bathroom back there. And this is going to be a studio. I'd rent for $2,000 a month and they would been, you know, whatever.

C (30:30)

Would you have wanted to do that?

A (30:31)

I mean, I don't need to do it, but it's always an option. And if I didn't have as much money right now, if I wasn't as like, well off as I am 100%. I mean, I have house hacked, which is like that term we use when you live in one unit, rent the other. I've house hacked almost continually, nonstop for the past 20 years, even living here in Hawaii. My last house, I just moved here. But the last house I was at for the last seven years, you've been there. My buddy Ryan Murdoch rented in the backyard. He paid 3, 30, $500 a month for the last seven years. Something like that.

C (30:59)

Like, what are your thoughts on modular homes? I see these like storage crate homes or the things like a home you can buy on Amazon and it's like $40,000 to add an extra unit.

A (31:08)

Yeah.

C (31:09)

Is that like, is there any company that's doing it? Like In a legit way or what are the issues with that?

A (31:14)

Yeah, it's a good question. I like, I like where the industry is going. The, the industry of like these small built homes. Boxable is a company that's doing it really well right there out of Vegas.

B (31:24)

Box.

A (31:24)

Yeah, I love those little things. The thing, the problem with those is like they can advertise stuff like, hey, you can get a casita, they call it there. Like you can get a boxable house for $50,000. Wow, that's awesome. But then you got to site prep your property and you got to get the water, sewer, garbage hookup. You had to do all that. That might be another permitting all that might be another 50 grand. And then the house is only 400 square foot. And so then you're like, okay, well I'm at 100 grand for a 400 square foot house. You actually could build a 400 square foot house for under 100 grand without doing one of those fancy like names. Now the, the reason I like them is because we're moving into that direction where we're almost turning homes into like Ikea or like they're going to get, the prices will come down. It's going to, it's going to be one of the solutions to the affordable housing crisis in America if, if ever. I mean, cities are falling one after another. They're following California. California always leads the charge on this stuff. Right? So California is doing the ADU thing. It's working really well. It's solving a lot of the affordability problems. We have a problem with parking though, but Elon's going to solve that in the next few years. And so though like once we no longer need vehicles and majority of people will just hop in their automatic, you know, Tesla and whatever, we don't, we don't worry about the parking much any longer. So it's got, it's a temporary problem with the parking right now, but that's solving the problem. City after city will be adopting this. It'll be across the whole country in the next few years.

C (32:36)

How many ways are there to make money in real estate? And what do you say are the best ways? Like, what are the ways that people also don't really think about?

A (32:43)

I like to say there's four primary, like I call them wealth generators to real estate. And this is the, like the simplest way of explaining it. When you own a rental property, you get cash flow if you buy, right? Like you get extra money every single month, profit in your pocket. Huge mistake people make though. There's a difference between, like, what people think is cash flow and then pure cash flow. And when I say pure cash flow, I mean, it's been, like, put through the fire. Like gold is purified by throwing it through fire. It's been purified through the fire. I mean, you own rental properties, you know, like, you can make, like, you know, I'm making 500amonth. Five hundred a month. Five hundred a month. Five hundred a month. $2,000 water heater. Yeah. Oh, dang it. Five hundred a month. 500amonth. 500amonth. $500 a month. $2,000 stove. So, like, you have to account for those big items that only happen once a decade, but there's 50 of them in a home, and so you count, like, they happen all the time. So as long as you're actually buying a property that makes money, pure cash flow, you get month money every single month. That gets you financial freedom. You get enough of them. Like, back when I started, I said I wanted $100 per month per unit. That was just my number. Twenty years ago, I used. That's gone up maybe a little bit now. But for simplicity, if you needed a hundred dollars, an actual pure in your pocket, post tax, like, because there's not a lot of tax anyway, we'll get to that. In your pocket. A hundred dollars per month per unit. Okay. How many units do you need to retire? If you had $10,000 in bills and, like, that would make you feel comfortable. Okay, 100 units. And you might think that's crazy. How am I ever gonna buy a hundred houses? Well, you don't. You just get in a multifamily. You buy the house. Later on, you buy a duplex, and you're like, okay, I figured that out. You buy the 10 unit. Oh, I figured that out. You buy the 50 unit, and you're done in three years. That's cash flow. Number two is appreciation. Obviously, property values go up over time. Yes, there's dips, but when you look at all of American history, property values always go up over time. Over the long run. That's where wealth is built, right? Like my. Yeah, cash flow is cool. I can pay my bills with it. Great. But the reason I'm absurdly wealthy is because my property that I buy for. I mean, example, what I bought here in Hawaii, I bought it that I just moved From, I paid 1.7 for. At the time, I was like, this is the stupidest thing I've ever done. I'm paying $1.7 million for a house. How could I Be so dumb. Why would I do that? That's stupid. And my buddy David Green, who is my co host on Biggerpockets, David's like, man, in 30 years, what that. What's that house worth? Probably like three and a half. He's like, and you can rent out all the units separately on there because you could, like, carve it up and rent it out if you had to, and you had to go move back home and work at Cold Stone again. You could rent it out and break even. I'm like, oh, yeah, sure. He's like, so worst case scenario, Brandon, worst case is 30 years from now, you're worth $3 million more because you paid off the property. And I'm like, oh, yeah. Worst case is I'm really rich. It's like, okay, so that's appreciation. Now, ironically, I held it for seven years. I just sold it for 3.2 million. Actually, we closed today. And so, like, three point. Yeah, right. That's appreciation. That just added, you know, almost. Whatever that is, almost a million and a half to my, like, net worth. Plus we paid the property off. That's the third way you make money in real estate property. You. You buy it at whatever 1.7. And I had a mortgage for 1.2, I think it was. But at the end of seven years, I only owned. I only owed a million on it. I paid off almost $200,000 in that seven years. That's just money in my pocket. And if I own a rental property, the tenants are basically paying off my mortgage. So number three. So number one, cash flow, number two, appreciation. Number three is that loan gets paid down. And number four is the tax benefits. In other words, If I make $100,000 a year as a landlord, in cash flow, you make $100,000 a year from advertising, from YouTube. I keep all my money. You're going to lose probably 30% of yours. So in other words, I'm naturally just getting wealthier just by holding on to real estate. Then if I play my cards right and I do the game right, which I. I do, I offset if I'm careful. And again, you got to do this right. So please, those listening, don't just go and assume this works. You got to follow the rules. I can offset my active income, the money I make from book royalties and from YouTube, I can offset that and not pay taxes on that because I own real estate. So that's just like the government just. It's just like me making money, right? If you save money, you're making money. It's the same. Basically the same thing. So that's how you make money in real estate, those four ways. Appreciation, cash flow appreciation, loan pay down, and tax benefits.

B (36:39)

So who should not buy a home?

A (36:42)

Yeah, if you are not good at budgeting and you are not good at dealing with difficult problems, those two things really what I mean by that is, like, if you're just bad with money, it's one thing to get you. You're bad with money, and so you don't pay your rent, and you, your landlord yells at you and you end up getting evicted. Like, that sucks. It's not the end of the world. I mean, it's fine. But you go and put down 10, 20, 30, $50,000 on a down payment, and then you're bad at managing money, and you lose it. You lose all that money, and you have now, like a foreclosure on your record. Like, that's a much worse. So if you're not good with money, get good with money. Like, pull yourself together. Be a big boy or big girl, and, like, learn how to have a simple budget. Like, that's obvious. And then if you can't handle problems, like, there are people out there who just like, like can't handle it when things break. I mean, every day almost, I feel like something breaks here. Or if I'm broken, it's just something needs to be worked on continually. I mean, just, I don't know, like, my pool just wasn't working the other day, and I'm like, why now? That's. Yeah, I got a pool, and so I have more things to take care of here. But like, one day, oh, yeah, my water dispenser in the fridge just not working right now. I'm like, I don't know why. Like, and like, if your person's gonna get overwhelmed and anxious and get all this anxiety around, like, oh, I just can't handle, like, the, the water is not working in the fridge. I hate this. Hey, don't buy it. Just call the landlord. They'll come fix your problem for you. Yeah, they'll take care of it.

B (38:01)

What about people who should not invest in real estate?

A (38:06)

I think everyone should invest in real estate. I, I really, as. You got to be patient. I guess that's the thing. If you, you get the long haul, real estate is a great way. In fact, I heard Cody Sanchez say this other day, real estate's a great way on this show. I don't know. It was like, real estate's a great way to, to preserve wealth. So she said, so if you have money, you can dump it into real estate. It's a great way to do that. What I disagree with her on is she's like, real estate's not a great way to make, like, make your money. I disagree. I think you can turn real estate and make a lot of money. You could flip houses. You could just get the cash flow if you know how to do it right. So I think either way, whether you're somebody who has no money and you want to get wealthier, yeah, real estate's a great way to do that. It really is a great way to build income. Better than almost any job out there. It's way more fun than almost any job. It's way more enjoyable. It's. It's way less, I don't know, drudgery. Like, everybody in real estate just actually kind of enjoys it. Most people. But, yeah. And if you're super rich, real estate's a great way to, you know, keep growing, preserve your money. Yeah.

B (39:03)

What would you say to someone like me where I look at the work of real estate and I think to myself, my time is better spent either getting a better guest for the podcast, one extra YouTube video a month. That outweighs anything I can. Real estate, for sure.

A (39:18)

100. In fact, I spend a lot of time talking people out of active real estate, but not out of real estate, just out of active real estate. So, yeah, I don't think everybody should go buy a rental property. I think there's ways to. And this is not just a promo for my own company, because there's a million guys that do it like me, but you can invest with people like me, and you can invest in companies, you can invest in a reit, you can invest in, you know, different private offerings depending on, you know, certain legal things. But, yeah, and you can still be involved in real estate. Now, should you go put 100 of your money in real estate? Of course not. Should you own your own house if you're wealthy? Yeah, I would definitely recommend that, again, you buy a house. In fact, I would recommend. When I was younger, I used to try to buy the cheapest house possible. Like, that was, like, cheapest of. Now I try to buy the most expensive house I can possibly do. Now, there's a reason I get paid, you know, whatever, almost $4 million for this house, because it's going to be worth a whole lot more, you know, 10 years down the road. But worst case, I could rent out the units and I could break even or even make money on this property. So, yeah, I Think that you can find ways to invest in real estate? I'm not. I mean, rates are fine. REITs are pretty similar. Maybe a little bit outperform the stock market over. Over time. Depends on what data you look at and who's whose reports. But I like private offerings. I mean, I invest in a lot of other people's deals. People invest in my deals and sometimes those go great, sometimes those go terrible. But I like having a bit of my net worth, a good chunk of it in real estate, no matter what.

B (40:41)

What's happened with your business over the last year? Two years, give or take.

A (40:44)

How's it changed real estate business? Like Open Door Capital? Yeah, we've slowed down dramatically. I mean we bought. Last year we bought $30 million of real estate. Most of that was self storage and a little bit of mobile home park stuff. The year before we were bought a lot of multifamily. We slowed way down on the multifamily. Multifamily is fun and I'll get back into it. And in fact, the market's getting better for multifamily. Prices are coming down. But the same thing I said earlier about houses, right? Interest rates are higher and property values are higher. It makes just the payment much, much higher. That's what happened in multifamily is just the same thing happened. Interest rates made all the interest rates, taxes, insurance made multifamily not really work very well. So we just went from, yeah, I think our goal the year before. I don't think we quite hit it, but our goal was 300 million in real estate purchased and then we did 30 million. Like that's like a, you know, Grant Cardone has a 10x rule. I did like the 10x slowdown. Like it's like. But who, like, who cares? Like, that's real estate. It's cyclical. So when it's, when it's good, it's great. We get in, we go hardcore and then when it's not, we slow down a lot. We've shifted a little bit to lending. Like I launched a lending company that just does like hard money or DSCR loans that's been super profitable and successful. We've leaned into the operations around mobile home parks because we have 6,000 mobile home like units around the country. They're a lot of work to manage. They're hard. And so we've really leaned into like operations like how do we maximize the profit versus grow the portfolio. So this is, it's been a, yeah, optimizing year.

C (42:09)

How do you get into real Estate if you have no money. I'm asking this because I have a lot of friends, not that have no money, but like don't have a lot of money because people think you need 20 down. The average cost for a home now in America is like crazy. And on top of that, with rates as high as they are, it's completely unaffordable for the average person. And on top of that, how can you do it like fast? Because there was a guy, we were at this networking event last night that you threw and I was talking to this kid, not a kid, but he was 24 and he had $80 million in real estate. He started when he was 19. But obviously the market was completely different five years ago. Like you could go in, you could pay 5% down. With rates as low as they were, it'd be affordable. You could actually make the payment. But now I feel like you just need to save up a ton for a big down payment and also have a strong enough income to be able to afford the monthly payment.

A (42:56)

Sure, yeah. So getting into real estate with no money, a couple, a couple of strategies. First of all, the idea of an. You have heard FHA loan. Yeah, it's 3.5% down payment on a loan as long as you're living in the property for a year. And you can do that on a multifamily is my favorite strategy for new people getting into real estate. And I've done it multiple times now. You buy a duplex or a triplex or a fourplex, either two, three or four unit. You can do it on a single family house as well. And then you live in one unit, rent the other ones out. So you could buy, let's call it a million dollar fourplex. And you live in one unit, you rent the other three units out and you can probably in today's market break even. You midterm rental those and now all of a sudden you're making profit. You Airbnb them now you're making a ton of profit. So that's one way to do it is kind of a combination of the house hacking with those fringe strategies. The other way that I get into real estate, more from the investing side.

C (43:41)

But how would you qualify for a loan though?

A (43:43)

Yeah, I mean a like you FHA is not too hard to qualify for. I mean you think you gotta have a 620 credit score, give or take. Now if you're sub 620 credit score or you just don't have the income to justify it, you can bring in a partner into an FHA loan. Who has the income to justify it?

C (43:58)

Say, getting a cosigner.

A (43:59)

You can get. Basically get a cosigner. That's a doable way.

C (44:02)

The thing is, though, if you're borrowing like $970,000.

A (44:05)

Yeah.

C (44:06)

Especially with the rates where they're at right now, I feel like you'd need to be making like 20k a month.

A (44:10)

Yes. They can sometimes use, though, the income from those other units to help you sometimes. Some depends on the lender. And, like, I actually don't know if it's the rule or the lender's interpretation of the rule, because some lenders, like, yeah, we just use that.

C (44:23)

That's what I've heard as well.

A (44:24)

Yeah. And some lenders are like, nope, you have to own the property for. You have to be a landlord for two years first before we let you do that. Yeah, that's possible. And so if you can't qualify for that whole amount. Yeah, the cosigner thing can help because all of a sudden they can use it, but they don't even technically call it a cosigner. I don't think with fha, it's just like, one person has to live in the property, the others don't. That's. That's one strategy that could work. And honestly, a million dollars for this is probably. I mean, that's like California prices. But in most areas in the country, you can find that fourplex for trying to get dilapidated. You buy. Yeah, you buy a little fixer upper, too. Actually, one of my favorite strategies, again, for a certain type of person, it's a FHA loan product called the 203K. It allows you to wrap in the repair costs and the purchase price into one lump, and you pay just three and a half percent of the total. So you're basically financing the entire repairs through government money at, you know, super low amounts. So, for example, you have $300,000 property could be a duplex, triplex, single family, whatever. It's $300,000 and it needs a hundred grand of work. So now you have 400,000. Normally you put 20% down on 300, so that's 60, and then you need 100 for repairs. Now you're at 160. That's a lot of money. But instead they take the total amount, three plus one. You got 400,000. Take three and a half percent of that. So what does that, like, 15 grand, give or take, and you put the 15 grand down, and then they fund the $100,000 needed for the rehab. That's a cool program because now why would you do that? Because that Property isn't worth $400,000 if you bought right. If you know what you're doing a little bit, you analyze it right. You don't buy a $400,000. You don't buy a $300,000 house, put 100 grand into it just to have a $400,000 house. That'd be silly. Just buy the $400,000 house. You do it because it's worth 5 or 600,000. So the reason I love that 203k loan is it's instant big equity. Like you get. You build in equity right away from the front. Like right away you got equity. And two, because you remodeled the house. I mean, you, you put 100 grand into it, you can get much higher rents and something I don't think a lot of people realize about landlord and is like, when you have a nice property, most properties aren't nice. Most rentals are not nice. I like, I'm a bougie guy. I like nice stuff. So, like, if I was a tenant, I would pay hundreds and hundreds of dollars more for a house that looks like it was the dime by Chip and Joanna Gaines than I would just for a house that is a White walls, boring like ugly flooring, whatever. So you made this property nice. You get an extra $500 in income on each unit. Let's just say. So your, your cash flows up $1500 a month. So maybe it would have been a break even now you're making fifteen hundred dollars to live for free and you have a couple hundred thousand dollars of equity like win, win, win, win win. So anyway, I love that strategy. 2 or 3k loan, very, very cool. The other way to do it on the investment side, let's say you're like, well, I don't have a lot of money, but I don't really want to buy a house for myself. I like being whatever. I like not owning a house or I already own one. The simple answer there is just partnerships. Like, I mean, that's literally how I grew to 13,000 units. I didn't do it myself. I have 2,500 partners. And so let's go real simple though. I bought a triplex one time where I found a triplex. I really wanted this property. I knew it was going to cash flow. It was super cheap. Now again, this is 15 years ago, but back then it was like 50 grand for this four earth triplex. I didn't have any money though. I was broke, had no job. I was just trying to, like, flip is like, way back when, I was, like, working on that single house that I lost all the money at. But I knew the deal was going to work out, so I just went to a buddy of mine, actually a guy from church. He was like the sound guy at church. We talked a lot. I knew he worked for the county as like an administrator, network administrator. I went to him and I was just telling him about this deal. I'm like, yeah, I just found this really cool triplex. Do you know anybody who'd want to, like, partner on it? Like, after I explained the deal? I never like to ask people directly. It's more because I don't want to be weird with family and friends or whatever. I'm like, do you know anybody? He's like, actually, we might be interested. What do you need? I'm like, probably just like 40 grand is really all it would take for the down payment on this thing. He's like, yeah, we can do that. And so he partnered with me. I did the work. I found the deal. Like, I managed some contractors, I managed the property. He put in money. That was it. I got that deal. We, every year we would meet together at a little Mexican restaurant. This is our routine for a good eight years. Little Mexican restaurant. We'd sit down, my wife and me, his wife and him sit down. We get our food, and then we'd write ourselves checks of the profit from the previous year. And it was always like five grand each of us would make. Again, not crazy money here, but just a little tiny, like $100,000 triplex, whatever. But it was like five grand they would make every year, and I'd make five grand every year. And I put zero dollars into that. You can do that with a single family, a duplex, a 10 unit, 100 unit, an industrial comp, you know, a warehouse, apartment complex, anything. There are people in America, a lot of them, who have a lot of money. Did you know the stats on how many millionaires are in America? I don't. It's a lot.

B (48:57)

Yeah, there's like one in eight people.

A (48:59)

Yeah, it's a.

B (49:00)

It's higher than you would think.

A (49:01)

Yeah, it's way higher than you think. There's so many people with money. I mean, I know you pulled your audience recently. I pulled my audience recently. Like, we have a lot of people with money that follow us, but they don't have time. They don't have passion or desire to go learn how to do this game. But here's the fun thing. About real estate. Real estate is sexy. What I mean by that. If you poll. We should do this poll actually. If you pulled 10,000Americans and said, do you think real estate investing is a good idea someday for you? Like, do you want to someday invest in real estate? What percentage are going to say, yes? 99%? Everybody knows real estate's fun and cool and a good way to make money. Most people just don't think they can do it, but everyone likes the idea of it. There's just something American about real estate investing. So anyway you get now, you're the expert. You know what you're doing. You find the deals. You're just good at this because you listen to the podcast and read the books and all that. There are way more people out there that are rich with no time that would work with you than there are, like, people to do what you are. The bar is very low for finding deals. Nobody. Nobody wants to work. Lots of people have money.

B (50:04)

What's happening with interest rates? When are they going to come down?

A (50:08)

I don't think they are. I think interest rates are there. When you look at the last, you know, whatever, 40 years of American interest rates, we are right dead center, even where they should be. Now. The government's going to. I mean, the government doesn't necessarily move interest rates, but interest rates are moved, and the government kind of controls it based on what they want the economy to do or not do. So everything I'm about to say, you know, with a grain of salt, take that. But interest rates are where they are because that's generally where they've been. We've just been split, spoiled like little kids the last, you know, 10 years, where it's like 3%. Like, what's your lowest interest rate you ever got?

B (50:40)

You know, 2.8.

A (50:41)

Yes, I had a 2.9. I'm like, that is that. That's stupid. Like, that's not. I don't think we're ever going to see it again. And I think we should take that approach that we will never see that again, ever. If it happens. Hallelujah. But I don't think we'll ever see it again. I think we'll see. I mean, where are we at right now? Like six and a half? Call it for a house. 7. Depends on who you go to, right? It went down. I mean, it went, obviously, went way up to 8, went back down to about 6. Now we're sitting at maybe 7. That's. That's. I think the next 10 years is 5, 6, 7, 8, 5, 6, 7, 8,. Fluctuating in there.

B (51:12)

And how do you see that impacting the market though, in the short term?

A (51:15)

Yeah, I mean, people are not moving as much right now. They're not buying as much, and that's fine. But it's a relative thing. We get people used to, I mean, it happened already when people were used to eight and rates dropped to six and a half. A bunch of people refinanced and moved and transaction happened. We went back up again a little bit. People slowed down and again, that's the, that's what happens. And so like now if we don't get to two again, like, I don't think anybody expects to get to 2 again. So when rates drop, we'll get an influx of the market. So they're still controlling the market. The government is somewhat trying to control the market, real estate, and they're trying to balance that with every other part of the market. And it more or less seems to be working. I mean, they're, they're kind of doing it. Yeah. Does it suck right now for a lot of aspects of real estate? Sure. It's a hard time to invest right now, but other ways to make it work. Sure. It's kind of like dollar cost averaging too. Like if it's hard right now, sure. But we can, we can still invest in real estate now and then when things get better, like, great, we're going to buy more real estate and then if things go down, that's okay. I'm just going to find ways to make it work now and then when it goes back up. So we'll just play that game.

B (52:16)

Yeah. This is something that Jack mentioned to me last night we found very interesting. We were at this event that you hosted called like the top.

A (52:22)

Is it 50?

B (52:23)

The 50.

A (52:23)

The 50.

B (52:24)

50 people pay $50,000 a year and you're surrounded by people who have $100 million plus worth of real estate.

A (52:30)

There's some ridiculous people there.

B (52:31)

Jack said that you pointed out, this person's going to be a billionaire. That person's going to be a billionaire. That one's going to be a billionaire. What qualities do you look for and how do you know?

A (52:41)

Yeah, good question. 1. I think there's just this, like probably maybe most importantly is they just, it's, it's not a hope. It's just like they just like they know they're gonna be a billionaire. Right? Like they just, it's just like, that's not a weird thing. They're just like, yeah, well, of course I am. Like when you, when you look especially age and like time like the kid you were talking to. Kid again. Yeah, we're all, we're all old. We're all old men talking about these 24 year old kids. Yeah. But Ark, who's coming on podcast, actually we're filming him in like three hours from now. Like I'm like, he's 24, like, like is he. And already $80 million of real estate, like, as long as he doesn't drastically wreck something or the market doesn't completely tank, given a 30 or 40 year span, he definitely is going to get there. But the same with some of the guys that if their net worth is $200 million right now, I mean there's guys in the group that have a million dollar net worth and they're pretty relaxed and they're like, yeah, I just like to buy a few more properties every year. And yeah, I'm not going to say they're going to be a billionaire, but the guy that's at 150 million net worth, he owns 5,000 houses and he's like aggressive and he knows like, yeah, I'm going to keep growing this thing. I love it. How is he not like, how is he not going to be a billionaire? Right. Even if he grows. Yeah, just like a decent number. I used to, actually, I used to think I was going to be a billionaire. I've changed though over the past year. I, like a year ago if you'd asked me, I was like, yeah, I should be a billionaire. Like just based on the next 30 years of growth of my portfolio. If I just keep doing what I'm doing with open door capital, with the properties, with raising whatever, yeah, I'll be a billionaire and that's fine. What's changed is my motivation. Like, you know, I had another kid just a few weeks ago and so I've got three now and I'm really enjoying that. And I'm like, I don't think I'm gonna, I don't think I'm gonna do for the next 30 years what I've done for the past 10. I think I'm gonna slow down dramatically. And that's okay. I've just, I've come to a place where I'm like, well, I don't need a billion dollars. If I wanted it, I'm sure I could probably fight for it. And you have a pretty decent chance. So. But yeah, so you see it in some people. They have the, they have the ability to because they have a business mind and they've got a strategy. To get there. This is going to sound silly, but it's not that hard to make. This is going to sound really silly. It's not that hard to make a billion dollars when you're investing in real estate. Because if you buy, I mean, if you buy $2 billion of real estate, and again, people are like, that's ridiculous. But you can do it. Partners, bringing people, raise money. When you're talking hundred million dollar apartment complexes, it's not that many of them. So you buy a couple billion dollars of real estate and then over a time period, 5, 10, 15 years, that goes from 2 billion to 4 billion. Okay, you just made $2 billion. Yeah. You had partners. Okay. So they get a bunch of the money. So they might get half that and you get the other billion. That's just how billionaires are made in real estate. It's not a super complex thing. And the, the process of buying $100 million apartment complex is really not that different. In fact, I would argue it's easier than buying $100,000 house in a lot of ways because you have people, you have teams. I mean. Yes.

C (55:26)

Less competition.

A (55:27)

Less competition, yeah. And there's just, it's just so much more systematized and less drama. And so like if you can buy a million dollar house or a million dollar apartment, you can buy a 10 million or a 50 or 100. There's a little nuance, differences. But that's why I say it's not hard to be a billionaire in real estate if you really wanted it and if you're willing to scale and you have that vision for getting there. Shoot. Yes. Yeah.

B (55:50)

How was the guy able to get $80 million real estate at 24 years old?

A (55:53)

Yeah. How do you do that? Yeah, go listen to my episode when it comes out. No, here's his strategy. And this could work. And I feel like he should tell his story more better than I can. But I can just tell you a bit of it is he utilizes a combination of seller financing, which is where the owner of the property will carry the mortgage. Right. So imagine first if this is confusing, imagine Jack, you have a car. What do you drive?

C (56:18)

A Tesla.

A (56:19)

Okay. Nice. Okay. You got a model? Yeah. What's that thing worth? Yeah. Okay, what do you own it? What's it worth?

B (56:26)

What, what, what price did you pay and what it's what is worth today?

C (56:29)

Yeah. Supermarket I purchased for 58 all in and it's probably worth.

A (56:36)

30. Okay, that's fine. Do you own any? Do you own anything on it?

C (56:39)

No.

A (56:40)

Okay, so you Own it free and clear. 30. $30,000 is probably what it's worth. I want to buy that car from you, but I don't have 30 grand, so can I just. Can I have the car? And I'm going to make payments to you. Is that cool? Just say yes. Yeah. Okay, so I'm going to. I'm going to pay you what's monthly. What's good. Monthly payment for that. Do you think?

C (56:56)

I want $500 per month?

A (56:58)

Perfect. I'm going to pay you $5 a month for the next X number of years. I don't know how many years that is. Now you are. I'm going to own the car. Like, I'm. It's going to be my car. It's mine. But you are going to have a lien on it. In other words, if I don't pay you back, you can go and repossess my car. That's. I mean, that's done all the time, right? When you buy a car from a dealership, it's your car, technically, but the dealer or the financier, whoever ended up with the loan, they have a. They have that lien. They can just go and foreclose or not foreclose. They can repo it from you. Real estate, exactly the same way. And so you have a house worth $30,000. I want your house. And so obviously, just trying to keep the math the same. I'm going to pay you $500 a month for your $30,000 house for the next X number of years, and you get the monthly payment. The seller financing is fascinating. It's a great model. A lot of investors. My buddy Gabe, Gabe Hamill, he's built his entire portfolio. Millions and millions of dollars. He's built it just off seller finance. That's all. Pretty much all he's ever done. Now, why would a seller do that? Like, why. Why would you do that? Because you want $500 a month. Like, yeah, you could. You could sell me your car for 30 grand. I could give you 30 grand. Now what, you got to pay taxes on it. You're going to lose 10 grand just in taxes on that thing. So now you only get left with 20, and you're. You're an old guy. What are you going to do with 20 grand? Stick in the stock market. Oh, that makes you nervous? Because, like, what if that goes down? That's my retirement. But I like $500 a month. And I know the car. It's a nice car. I can take it back if I needed to. So that's why guys do seller financing. I've done seller financing for people.

B (58:25)

How does taxes work on that? Because you mentioned the tax thing, that if you get the 30,000 upfront, you're going to pay tax on it.

A (58:30)

Yeah.

B (58:31)

How does that work in real estate? Are you only taxed on the monthly payments?

A (58:33)

Yeah, pretty much. I mean the simplistic version of it, but yeah. So when you do seller financing, you only pay taxes on the money you're rece. You don't pay it on the entire amount. So again, let's say I wanted to buy $1 million property from somebody. In fact my very first apartment complex. I bought a 24 unit apartment complex when I was 24 years old. And the owner, they, they didn't want. It was like 4, let's call it 500,000, roughly 500k for this 24 unit. They didn't, they didn't want to own anymore. They were, well, they want to Travel, they were mid-70s, they had an RV. They want to go travel and see their grandkids around the country. But they were relying on that income because they were running the company. They, they, I mean they're running the, the day to day operations but they didn't want to run the day to day operations so instead they sold it to me. I paid them every single month and they just went and traveled around and so they just paid taxes every year on whatever they received in that year. And again, it's pretty low tax rate because you're just basically getting interest. I think it's just interest money at that point. Yeah, pretty, pretty cool strategy. So when guys like get a lot of real estate for no money down, what A lot of times what they're doing is they're doing a com of some seller financing. Like they might get the seller to carry a, whatever million dollar second mortgage and then they go to a bank and they get the first mortgage for a $4 million one. So they have 4 million from the bank, they have a million from the seller, and there's the 5 million needed to buy this property, let's say. Does that make sense? So that's one strategy that a lot of, a lot of people utilize to get big real estate deals for really no money out of pocket.

B (60:05)

Where do you go to find good deals? Because everything that I see, let's call it the mls.

A (60:09)

Yeah, yeah, yeah.

B (60:09)

Everyone else's access to it. It's not really the cream of the crop, let's just say. So where do you go?

A (60:15)

Yeah, so the couple, there's a Hundred strategies we could talk about. I took you through my favorite. Yeah, I still love what they call it, driving for dollars. It's almost no money. You can do it. Most people can do it if they got a little bit of free time. Get in your car, go to the neighborhood you want to buy a property in and just drive around. And what you're looking for is just properties that look like they have a problem, like there might be something wrong. In fact, I, I like walking for dollars in my neighborhood, like up here. And I just. When you're walking and you're looking for those, you'll see them everywhere. Like, you're gonna, you guys are gonna start seeing this stuff. Like you see a mailbox that's just stuffed full and you're like, oh, interesting. They haven't checked their mail in weeks. I wonder what's going on there. Or the lawn is, you know, 8 inches high. They haven't mowed their lawn in a long time. Or like, there's not a single item outside their house. Nothing. It's just completely, completely empty. They don't have a, I mean, nothing. There's no bird feeder sitting there. There's nothing. Blinds are all closed. It's probably vacant. So what you're looking for is problem properties. And then you just, it's all public data. You figure out where's the tax bill going for the person who owns that house. You can write this down. There's an app out there. I have no affiliation with them, but they're called Deal Deal. Oh, shoot. Deal machine. Yeah, Deal Machine. I've used them before. It's great. But it literally lets you do all this on an app. Yeah, you just like, okay, that address, that one, that one looks interesting. That one looks interesting. And then you get the owner's address where the mail, the tax bill is going to. So if it's not that same place, which usually it's not, now you know where it's going. And you can, what they call skip trace. You can find their phone number, call them up. Hey, I was just walking by that house over on 3rd Street. I saw it looked, it looked vacant. I'm just a, you know, young new real estate guy looking to buy a property. And I just thought I'd reach out, hey, any chance you want to sell? And so the short answer, like, that's one strategy driving for dollars. The, the more meta or more like high level discussion is real estate investing, like for good deals is a funnel. Like, if you think about, like funnels in business, right? Like, hey, you're you're. I don't know, whatever. Like, you're a car dealership, and you have a thousand people drive by every hour. And out of those thousand, 10 people stop by and come inside. So it's like 0.1%. And out of those 10 people, two of them test drive a car and one of them takes the car home. And that's just a very simple sales funnel. We do it in every aspect of business. That's all finding good deals is. I have a thousand properties on my, like, list here of properties that I think I might want to buy. I'm going to contact them, and I'm going to get a hold of a third of them, and out of the third, I'm going to get a hold of maybe 10% of them are going to have an interest in selling out of them. Maybe half of them will actually, you know, whatever, agree to sell. And so I might have a thousand possibilities, and then I buy one of those homes. It's just a funnel. And so the people who do a lot of real estate, I mean, I got. I mean, we buy a lot of real estate, but they're big deals. I got buddies like my buddy Cam Cathcart. He'll buy 10 houses in a month. Like, how do you buy 10 houses in a month? Because they are talking to thousands of, you know, hundreds or even thousands of people. And it's just a funnel. They're never surprised. Like, the best real estate investors, all the people I interview, all people that were at the 50 last night, like, nobody's surprised when they get deals because it's just a funnel. Nobody's surprised they have a six pack. Like, it's not like you're looked down. You're like, oh, shoot, where'd this come from? Like, whoa. It's like, I'd be shocked if I didn't, you know. Well, I don't have a six pack, but if I did the work for a six pack, I just have a gym in my background to make it look cool. But if, like, if I did the work for years and years, I'd be shocked not to have one. If I sent out another strategy, if I sent out 10,000 mailers to people who owned. Let's just say, for example, you own real estate, but you don't live in that property. That's public data. We can pull that list real easy using a site like Propstream, that's a website. I send out 10,000 letters to 10,000 people that own a house, but they don't live in the House. Well, what does that mean? If they own a house and don't live in it, it's probably rental. Okay, well, or. Or it's just vacant. Either way, would somebody who owns a property that's vacant or rental, would they consider an offer on their property? Good chance. Like maybe, right? Like, I'm a landlord. If somebody wants to buy my property, the answer is not no, it's how much. Right? Like, like. Well, let's talk. All right, so you send out 10,000 letters. Now you might get, let's call it 1%. Like, of those people are going to call you back out of 10,000 letters. So is that what 100. Am I doing my math? Right? So like, okay, you get 100 phone calls out of them. Some are going to be like, screw you, take me off your list. I hate you. You know, like, you get those and then, okay, fine. And then 50 of them, though, maybe want to sell. You have a conversation, and most of them are just like, you know, you give them a lowball offer, whatever the number that makes sense for you, and they're like, no, screw you. But every once in a while, then out of maybe 10,000 letters that cost you $10,000 to mail those out, you get two deals out of that. And out of those two deals, maybe one you flip and you make $80,000 on a flip. And one of them you holds a rental that makes you 500 bucks a month in cash flow. That's how you get deals. It's coming up. There's a lot of strategies, like a lot of different little things, like driving around mailers, TV commercials, a sign on the side of your car, all that stuff works. Radio ads can work really, really well right now. All that strategy is just designed to get them in the funnel. And it's your ability to optimize a funnel that determines how successful you are when it comes to getting to deals.

B (65:18)

How do you negotiate the price down? Like, do you have any strategies?

A (65:22)

My favorite. Yeah, my favorite strategy is simply to give people multiple options. Like Starbucks offers a tall grande and Aventi. Right. Just so you don't Compare it to Seven Eleven's you know, Dollar Coffee. Yeah. So you can five or 12. And you're like, I'll pay, I'll pay the five. Five sounds good, right? You're not like, wait, that coffee over there is a dollar. That's so I love that same strategy, especially with properties that aren't. Like, if a property's got multiple offers and like, they've already, like, you're competing. That's not going to work. But if I'm talking to a seller, I just give them a couple options. Hey, here's a few things I could do. I could pay. Here's example. I could pay, you know, $300,000 for your house. And just as is, I can close like next week, like all cash. We'll get it done. Or I can pay 320, but for that extra $20,000, I would like you to do whatever. I want you to include all the furniture in the house I want you to keep there. And it's going to take me another month to close. So then the seller's like, which one do I want? Which one do I want? They're going back and forth, which one do I want, which one? I don't care which one. They can. It literally doesn't matter. I gave them like two scenarios that I'd be happy with either way and they're trying to figure out which one they want. They're not thinking yes and no, they're thinking, which one. That's my favorite negotiation strategy. It works really well. People do it on me now. Like I have friends that will negotiate with me on stuff, whether it's a real estate deal they want to buy from me and they do that. I'm like, I know what you're doing. I taught you that.

B (66:37)

That's funny.

A (66:38)

Yeah, but it works. So I know I'm fairly well off financially. Right? But did you know I still house hack? Like that's right. I've got an extra couple of units at my house here in Maui and I decided to actually rent one of them out because hey, it's like almost 2,000 bucks a month and I'm an investor, so why not? You know the first thing I did when I decided to rent that out, I went to turbotenant.com because there I can advertise the unit, screen for potential tenant, sign the state specific lease, get automatic rent payments set up, track my income and expenses, and even communicate with my new tenant via the app. It literally made the process so much easier. So whether you've got, you know, one unit or a ton of units, check out turbo tenant.com I love it and I know you will too. Let them know I sent you.

C (67:20)

Where do you think the best opportunity is right now? Is it in commercial? Like some sort of like flex space industrial or I don't know, residential real estate? High density, self storage.

A (67:30)

Self storage.

C (67:30)

Trailer parks. We were talking.

B (67:32)

Or mobile home.

C (67:34)

Mobile home parks. We were talking yesterday or two days ago and you were Saying that there was a lot of issues with commercial recently. But that also means that there's a lot of opportunity for sure. Where do you think the best opportunity is?

A (67:45)

Yeah, the best strategy is the. I'll say the meta answer first. Like the best strategy is the one that fires you up the most and works in the location you're buying. That's it. Like, like, like they all work. I can find it. I mean last night at that dinner, right, we had like roughly 50 people there doing things. Almost nobody in that group does the same thing. It was actually pretty wild. Like the differences, like there's a campground guy and there's a, you know, mobile home park guy and a self storage guy. All these things, right? That's that. So they all work it. There is no best. It's like what's the best diet? I don't know. I like carnivore stuff. That's fun. Keto's cool. Like it's, it all works. I can find fitness influencers that swear by everyone and have science to back it up. Right? Like every fitness influencer has science data that backs up why theirs is the only one that works and everything else sucks. Yet that doesn't mean. Doesn't make sense. But they all have it. Same is true for real estate. So there is no best. I'll tell you my favorites right now though. I love the concept of the rent by the room stuff. If you're willing to go through the hard. I really like industrial warehouse right now. If you have the money and the knowledge to be able to pull that off, like buying a big warehouse and renting it out to like not even necessarily Amazon. I'm just like, let's say you have a seven different warehouse, like seven bay warehouse. You sent rented out to seven different companies in your area. Plumbing company, a trucking company. I love that stuff right now. Super scalable. I really like assisted living. Like I mentioned residential assisted living. I like house flipping right now. Like I think it's a good market to flip houses. Not the best market we've ever seen to flip houses, but people are still buying nice houses right now. Right now. If you can, if you can handle the finances of flipping. I like flipping right now. So it's again, those are, those are all good strategies. If I had to just pick one for let's say you, I don't know why. I'm just hypothetically, if I had to pick one for you, I would say you should go jack into residential assisted living. It'll take you a year to buy Your first one, it'll take you a year to learn it. It's going to be hard. You got to get a license for something. You got to figure out how to get some staffing to run it. But you do it right, one year from now, you'll buy your first one and you'll make 15 grand a month in profit and you're done. Like you're like financially free. I mean, you're probably already financially free, but you're like that. Hypothetically, you're there, right? You buy one more year, you buy another one. Now you're making 30 grand. Now you're gonna have to hire some more, a little bit more higher level staff at that time and then you buy a third one like that. For the amount of work I'd probably do residential assisted living, you know that yesterday we were out in the water on the boat, right? We saw the whales in the distance. Yeah. So I like to go paddle boarding with the whales. Like I love that going out there. And if you want to get like a close encounter to a whale we were doing on the boat yesterday, we maybe didn't notice. You don't, you don't paddle or you don't boat to where the whale is. When you see it on the horizon, you go in front of it, right? You can see the direction the whale's moving. And you just want to get somewhere in front of it because the whale's then going to come up to you. Like you're not going to it. It comes to you. The reason I bring that up is when I look at American real estate, like, where's the whale headed? Like, where's America society headed? As a real estate investor, if I want to get wealthy and ensure that things are going to go well, I want to get in front of the whale, I want to get in front of the economy. Where is our economy moving? Let me start working in that sector right now so that when it catches up, I'm going to make a lot of money. Assisted living, there are so many old people in America right now and we're not building affordable housing for them. So what are we going to do with them all later on? Like we're in 10 years from now, it's going to be a massive problem in America. Okay. So assisted living is getting in front of the whale. You could get good at it. Now you're going to make a killing. Adus like we talked about. That's a whale that's coming. It's a ma. Affordable housing in America is maybe the biggest whale Right now, America does not know what they're going to do. So get in front of it. Section eight, like that's the whole program. The government pays rent. They're going to have to broaden that. Okay, get good at that right now because that's where the whale's headed. Luxury multifamily. I don't want to touch that. Like real high end, a class luxury multifamily. Maybe long term it'll be fine. But we've got a lot of that right now and we got a lot of people that don't want it. So I'm not going to get in front of that whale.

B (71:39)

What markets do you like to buy in? Like what locations?

A (71:42)

Anything. But no. Okay, I'm going to say five states that I really, I do not buy in. Okay. Because they're hard. I have chosen. That's not my hard. You got to pick a hard. I like. I like certain things that are hard. Like I buy mobile home parks that are half empty and I try to fill them up. It's the hardest thing ever. But that's my hard. I just picked it. Politically though, there are five states I don't want to buy in because I don't like that hard. And you probably guess what they are, but California, Oregon, Washington, New York and Michigan, I don't like those. And probably not Illinois if I wanted to add a sixth one on there. Now what's, what's similar about all those states? They're all just really left leaning states now. It's not a political thing. You know, Seattle had a rule or a legislation going through a little while ago. It didn't pass for obvious reasons. I'll say. But they wanted to make it so if you were a landlord, the tenant will get equity and ownership in your property. No. Yeah, they wanted to give tenants ownership and equity because they, they deserve it because they're living their housing the right. And so if you are a tenant, you get to own your landlord's property and the longer you live there, the more. Yeah, that's ridiculous.

C (72:43)

That would ruin tenants.

A (72:44)

It would just ruin everybody. Like as a tenant, like, hey, we need $800,000 for a new roof, so. Hey, Ms. Johnson, I know you're just working at the grocery store, but we're gonna need you to cop up 40 grand out of your share. Like it would never work. Right? Like this is silly. That. But doesn't matter. It doesn't stop liberal governments from just being silly. And that stuff starts passing. Sometimes silly things start passing and there's a lot of just legislation that doesn't help me as a landlord in those five or six states. So has nothing to do with the politics of it. Like some people I'm sure. Maybe it actually helps people. Good. Doesn't help me. And so therefore I'm going to avoid those states. Wow.

B (73:18)

What about locations you really like if you were to pick maybe like the top three states?

A (73:23)

Yeah, I like Florida a lot. A lot of people move in there. I like Arizona a lot. A lot of people moving there. I like Nevada a lot. A lot of people move in there. Again, all generally conservative states. Not crazy. Property taxes aren't insane. I like Texas, but property taxes are just too crazy. Can you make it work? Yeah, that's just not a hard I want to face. And I own, I mean I own hundreds of millions of dollars of real estate in Texas. I'm just like, I really am getting tired of the property tax problem.

B (73:48)

So what about buying for cash flow versus appreciation?

A (73:51)

Yeah, that's why I don't believe you should, I don't believe you should choose. I mean again there are nuances here, but I don't think, I think you buy real estate in areas that will appreciate and you use strategies at cash flow today. So for example, if I can't cash flow in Vegas, but I believe in Vegas appreciation, which I do, I think Vegas has a lot of things going for it. So I'm just going to buy in Vegas. But I'm going to utilize one of those strategies that, that will allow me to get cash flow today. So I might go to Vegas and find a duplex that would break even. But I'm going to again, maybe it's a midterm rental on each side. Midterm rentals aren't governed by the short term rental laws. And so I can get, I can get higher rent without having to do the violate short term rental laws. Now I get cash flow and I get appreciation. So I don't think you should settle for one or the other.

B (74:34)

That makes sense. How do you be a good landlord? Well, what are your, what are your tricks?

A (74:38)

You take care. I mean take care of people. Like that sounds so like cheesy but majority of landlords just don't care about their tenants in any way, shape or form. They, they just don't care. And they don't care in two interesting ways. Sometimes they just are way too like mean and harsh. And I'm not going to fix up anything on your property and I'm not going to do that which is really bad for the landlord. Because their property falls apart, they get worse. Tenants, there's no, like, retention. So, like, if you're a jerk to your tenant, you don't treat them right. You don't fix things when they're broken. You're going to have a time. The opposite side, though, of being a bad landlord is being too kind and nice. I should say nice, not kind. You're too nice to your tenant. An example is like, hey, I know, Ms. Johnson, that you, you know, it's been a hard year, and you're five days later in your rent. But you know what? It's okay. Don't worry about it. Just get it in when you can. Now that's a really nice thing to do. And she's like, oh, thank you so much. Okay, next month, Ms. Johnson's like, hey, you know, I'm a little bit behind. I had some problems. Go on with whatever. I, I, I gotta pay rent a week late. Okay, that's fine, Ms. Johnson. Hey, you're doing well. Next month it's a couple weeks late. Next month it's a month late. Next month it's two months late. And now you've got a problem as a landlord. So what do you do? You evict Ms. Johnson. She can't catch up. You got to evict her. So whose fault is that? The landlord's fault? Because you were, you were trying to be nice instead of, like, firm, I guess. I'm not saying you go like, hey, you're late on your rent and I'm going to evict you today. But it's just like, hey, Ms. Johnston, like, the rent is due on the 1st. I need it on the 1st. My mortgage payment comes out on the 3rd. It's got to be in. So there's going to be a fine. I hate to do that. If you want to waive it the first time, wave it the first time you want to be a nice guy. But we've got to institute rules. That is being a good landlord. Because it actually helps Ms. Johnson, and it helps you. So, yeah, be good to your tenants is like the key to being a good landlord. Yeah. Yeah.

B (76:28)

For me, I always struggled with that because I fell in the camp of usually being too nice, generous. And for a while, I think, looking back now, I do have regrets about doing this. But I would never raise the rent if a tenant always paid on time, never any issues, took care of the places around. I really hated raising the rent because my thought was that I'd rather earn a little less and just keep them there. For 10 plus years. I would love that. It's less turnover for me. They get to save some money. Everyone wins. 20, 20. My expenses went through the roof. And I had several places in Los Angeles that were rent controlled. I couldn't raise the rent on them. And when I was able to raise the rent four years later, my expenses have ballooned to such a point where even if I maximize that rent increase, which I. Which I did, I think it only came to about 4% in a year. But I hadn't raised the rent in the, like the six years prior to that. So now I'm raising 4%, but my insurance is up 50%. My property taxes went up. Everything went up so much to the point where now I look back and I think I should have been raising the rent and maybe just given some, like, hey, I'm going to raise the rent, but I'm going to give you 15 days free.

A (77:40)

Yeah. And that way about other ways to be kind. Right. And to give. Give back. But. And here's the other side of that is let's say you don't raise rent for five years. You sell the property.

B (77:49)

Yes.

A (77:49)

You're way below rent. What is the new buyer going to do? They're going to jack up the rent. 2,000 bucks on Ms. Johnson. Now, she definitely can't afford it because she's not used to that. Where if you would have raised it along the way to a normal inflationary rate, not been gouging them, but you're just being good and you're just raising it the way that you. Yeah. That we wouldn't have a problem. She'd be able to afford it because she'd been used to that on time or she would have found somewhere else along the way on her terms and not just the massive rent raises. Yeah.

B (78:15)

So I think in hindsight, I should have raised the rent more.

A (78:18)

Good to hear you say that. Lesson learned. Yeah.

C (78:21)

I hear with rent control, what a lot of like mom and pop landlords suffer the same thing that you experience was rent control trying to kind of mandates you to. Or it commands you to increase the rent.

A (78:30)

Yeah.

C (78:31)

Maximally. Every single year.

A (78:32)

Yeah.

C (78:33)

Because if you don't, you're just screwed.

A (78:34)

Yep.

C (78:34)

And you screw over the 10 as well.

A (78:35)

Yeah. In fact, that's one. When people ask me, like, are you worried about rent control? I'm like, not really. Like. And Grant Cardone has a great viral video. I don't know whose show he was on, but he said, like, yeah, if they mandate rent control, I'm going to be worth like $5 billion more in the future. It's because like every, like if they mandate 4% a year, he's only underwriting. And same with us, we're underwriting 3%, 2% rent growth maybe, like if they mandate 4% or they allow like that's what we're going to raise it to. So all of a sudden rent's going to go up higher. So who does that benefit? Benefits the landlord. So long term rent control doesn't hurt me. It's going to long term again, help the people at the top. Like, it's not a system I like it's just a system that exists. So I can either like I can, I can work in it, or I can just get angry about it and post on social media how dumb it is which people will below this video. But it's like that is what it is.

B (79:20)

What are your thoughts about Section 8 and investing in those?

A (79:23)

Yeah, yeah, I love investing in Section 8. I think that Section 8, which is called something else now, but we all still call it Section 8. Section 8 is where the government pays part or all of the tenants rent. It is a really good program to get into because it's really hard to get into because there's so many people who want it. So once you're on it, you don't want to screw that up. Like you've been waiting eight years to get Section eight and finally you get on it. So you're going to do everything in your power not to screw it up. So I like Section 8 because it makes people better tenants. A lot of times you still have to screen your tenant. A lot of landlords make the mistake of going, well, the government's paying for their rent so it's going to be great. So they just let in anybody now, make sure they're still a good person. They haven't got evictions on their record. They've, you know, they've done a decent job of being a human being over the last few years. And then Section eight can be great again. I think the US government is going to have to widely expand. I mean, maybe 10x or 100x that Section 8 program. I think it's just a, a trial right now for what's coming in the future.

B (80:19)

Yeah.

A (80:19)

So get, get it, get it now.

B (80:21)

And yeah, my only experience with Section 8 was not a pleasant one, to be honest. Yeah, I mean, obviously the rent gets paid every single month on time. That was a benefit. But the inspections.

A (80:30)

Yeah.

B (80:30)

Like sometimes the tenant would go in and the tenant was really dirty or would break something and Section 8 would come in and say, landlord, you have to replace this. I'm the old one. I'm going to replace it. And then it's going to break again or the tenant's not going to take care of it. And then I got to replace it again.

A (80:46)

Yes.

B (80:46)

I even had a situation where I was remodeling the unit next door to the Section 8 tenant, and there was some paint chips that were on the exterior because I was in the middle of painting. And Section 8 says, we're not paying the rent until you clean up all of these paint chips because it's a hazard for children. As if there are no children around here. This person is not a child by any means. Well, this is our policy, and you have to abide by it. There's so many little things like that where I really didn't like the level of scrutiny that they went through the property and just silly fixes that I felt the tenant should be paying for that I. I shouldn't. But they mandate the landlord take care of it.

A (81:25)

Yeah, I haven't had as much of that. I mean, we have a lot of Section 8 tenants. I haven't had as much of that. I think some of that's probably California, right? Like, sure. Again, why. I don't like to invest in California. I think California just has a. I don't know. You guys got a weird vibe. I know why you left. But some of that, too, keeps landlords because it's needed for a reason. Because they wouldn't exist if you didn't have a bunch of bad landlords out there just trying to take advantage of the system. So they put that in there and maybe it's a little overboard, but it keeps you really maintaining a good enough property. So it's one of those. Yeah, I'll get. I'll. I'll survive with it. But yeah, I like section 8. I like to program. Here's an interesting Factoid about Section 8. Section 8 pays higher amounts. And this is one of those, like, how do we get. It's a fringe strategy. One of, like my 20 fringe strategies that I talk about. Section 8 pays more based on bedroom count.

B (82:10)

Yes.

A (82:11)

Right. Unlike it's. It like a. And it's drastic a lot of times because a lot of section 8 people have a lot of kids. It's pretty common to be on section 8 because you have a lot of kids, you maybe don't have as much time for working and so you'd have less money. So there are Not a lot of landlords who have a six bedroom house out there. So supply and demand, section eight. It's like, oh, we need more six bedroom houses because we got all these people with five kids. Let's offer more money for a six bedroom. So you might see something like. And you can literally google this, like look up like what section it is in your county. But it might be $2,000 a month for a two bedroom, 2,500 for a three bedroom, 2,800 for a four bedroom, 32 for a five bedroom, 55 for a six bedroom, 85 for a seven bed. You know, like it can in some areas based on their needs, drastically increase. So I got some, a buddy out in Washington D.C. does this. He'll buy a house, you know, similarly I said adding bedrooms, he'll add like eight bedrooms to. He'll have eight bedrooms in a house or remodel the basement, put really nice bedrooms and then he goes over the top to make it a nice property, like really nice. But then he's getting just ridiculously high rent rents from the government. And the person moving in is like, this is the nicest house I've ever seen. Like he screens them well and it's a beautiful house, beautiful property. They are never going to be a problem because they never want to lose that.

B (83:24)

So the government's paying $8,500 a month some areas.

A (83:28)

Yeah. I mean every county depends on like the, what the average is in the area and then it's bedroom count. But in some areas it can be. I mean I've seen over ten grand in some areas for certain size houses. And then after disasters, I mean like this in section eight. But yeah, you're paying 25 grand a month for houses in Maui after the fires. Like it's just like. Yeah, it's supply and demand.

B (83:47)

That's incredible. What are purchases that you think every person should make? It doesn't have to be real estate related, just in general.

A (83:54)

Oh, that's a great question, man. I think everyone needs a Ninja Creamy. We talked about that Jack yesterday. Yeah, I don't think I'm gonna have enough time. I don't know if we're time to try it. But it's a Ninja. Oh, this is like a commercial for Ninja Creamy. I'm the best sales guy for Ninja Creamy. I have no stock in that company. But I should. Ninja is a brand of like blenders. Yeah, right. Yeah, you buy Ninja Cream at Costco, but you put, you get this little, you make a liquid of some kind and different Recipes, freeze it overnight, blend it. Not blend it, whatever you want to call it. Mix it the next day and it makes the best consistency ice cream ever. So here's the secret. You put in the Fairlife chocolate milk from Costco, 150 calories with 30 grams of protein. A scoop of whey protein powder and then a little bit of salt, little bit of like, non. If you're not. If you're like trying to keep it healthy, like what do you call it? Monk fruit like sweetener. And freeze it overnight. Next day, make it. It is the greatest tasting ice cream with like 50 grams of protein. Less than 30, less than 300 calories. Wow. It needs its own energy. Yeah.

C (84:55)

JJ was ranting and really thinking about the Ninja cream and I wanted to buy one. The only problem is I felt like I had to try it out.

A (85:01)

Yeah. Yeah.

C (85:02)

For myself.

A (85:02)

Yeah. We have time on social media and. Yeah.

C (85:05)

Just like singing its prayers.

A (85:06)

Yeah. I want it so good. Yeah.

B (85:09)

Holy crap.

A (85:09)

Yeah. It's so. It takes five minutes to make or four minutes to make a dish of ice cream. And there's a. There's a lot of recipes and TikTok. You can go down the TikTok, like get on the algorithm and that's all you'll see is Ninja Creamy recipes. Anyway, everyone should have a Ninja Creamy. I think everyone should have a goal journal, like a habit tracking journal where they track their daily habits. I think we talked about this on the show last time. Is every morning, just track your habits that you care most about. It's like the ultimate life hack. Like you just track the stuff you want to do because at the end of the day, you get the results of what you repeatedly do. If you want a six pack, there's something that you repeatedly do. It gets you that if you want a better marriage, there are things you can do that will get you that. If you want to be a better dad, you want more money, you want to save more money, whatever it is. There's just things we do and nobody tracks that stuff. If you want to completely change your life, alter it forever, just start tracking your habits.

B (85:55)

This guy there with the.

A (85:57)

Yeah. I don't think it'll pick up much.

C (85:59)

It's probably fine.

B (86:00)

Okay, cool.

A (86:01)

Yeah. All right. Of course. Right when we're filming.

B (86:04)

Yeah. Are there any other purchases you could think of?

A (86:07)

Anything else you want to add on to that? No. I know it's a good question. Aeropress, I think for coffee, aeropress is phenomenal. You use those, you know, you push down the AeroPress I'm gonna get you an arrow. Okay. They're cheap. Have you had Andrew Wilkinson on the podcast? You know, okay, I'm gonna connect you with Andrew too. He's a phenomenal guy. He owns aeropress or his company does Tiny. They own aeropress. And man, that they should. They should get a Tesla. Everyone should have a Tesla. They're the best. They're great cars. They're great cars. Yeah. I don't know about the cybertruck, though, but Tesla's great.

B (86:37)

Yeah, I love this. Now, the other thing we're curious about is your business inefficient? Because we were talking to some of your team and a lot of people say that there's a lot of, like, almost a chain of command that they have to get through to get to you. And a lot of times things fizzle out on the way up and they don't get all the way up and they just kind of lose steam.

C (86:58)

Explain for those people listening right now that may not be familiar, like, how many businesses do you operate? You're throwing out X Capital and X this and this.

A (87:06)

Yeah, I like, roughly call it seven or eight businesses. So if you have. I have a loan company called Better Life Ref. I've got the open door capital. I've got the Better Life Tribe, which is about a thousand. It's like membership without a thousand real estate investors. All that goes to charity. I've got the media company and I've got this thing called First Deal. It's like, first deal, get your first deal and then a couple other small random things. Yeah, there's definitely a hierarchy. You could call it. Or organizational chart. You could say, uh, it's because. And ultimately, like, yeah. I had a friend the other day say this. He said, hey, Brandon, some people buy real estate and some people build businesses that buy real estate. Right. So you can say some people. Some people do the thing, and some people build businesses around the thing. I am trying to build businesses around the thing, not do the thing, if that means. And it's a subtle difference, right? Like, some people podcast and some people build podcasting businesses. The end result is probably the same. The difference is, you know, the corporatization. And I hate corporate, like, corporate stuff. I hate the Hawaiian shirt Friday and get your TPS report in and all that. But when you're trying to run seven, eight businesses at one time, especially with one face, like where I'm the head of all of them, I'm the face, I have to have layers. I have to have operational efficiency inside of Those. And sometimes that is inefficient, like trying to get a video made. Like somebody. My mortgage company needs a video made for social media. Okay. That has to go through several different people, and that is inefficient. That's annoying. I can't be as nimble. It's like moving the Titanic. It's just harder. However, that's the really the only way to have a hundred. And I'm gonna call 150 employees. I think that work for me right now. Spread out. It kind of has to be that way. But it's also what allows me to grow, you know, millions and millions and millions of dollars every year in revenue and be able to handle that.

B (88:51)

Do you think any of it's worth scaling back? I think we were talking to your social media team.

A (88:56)

It's.

B (88:56)

It's way bigger than what we expected.

C (88:58)

It's bigger than our social media team.

A (89:00)

Yeah.

C (89:00)

And I feel like I don't putting out a good amount of content.

A (89:03)

Yeah, yeah, no, it. Definitely bigger than your. I mean. Yeah, definitely bigger than yours. And some of that is operational inefficiencies, probably. I would argue that you guys. This may come across sounding bad even to my team. I don't mean that. But you guys are probably the equivalent of 10 people that would work for you. Right. In other words, you could probably hire each 10 people to do the equivalent of what you guys know and can do. I don't do anything. I mean, like, I show up and it's the button. Record button's already there pretty much. Right. And so for that, I have to have, I think, more people. If I got involved because I'm good at. If I was good at it like you guys are. Yeah. I just think, yeah, you're the equivalent of 10 people. Is it worth scaling back a hundred percent? I have too many companies. I know that I would be more effective by far if I scaled back. This is a hard thing. Once they're already running, they're all profitable. It's like that lie. It's like, oh, I can do it all. I can do it all. But you can never do it all. And so, yeah, we are constantly pruning. There's a great book by Mike Michalowitz called the Pumpkin Plan, which basically says whether it's different businesses or divisions within your business, the way to grow a massive pumpkin is by starting with a lot of them and then trimming all the ones that are not good enough until you're left with one. And then you pour all your energy into one so right now I've got a lot of pumpkins, and trimming is a good idea.

B (90:20)

Now, in terms of money, have you found that money can buy happiness?

A (90:25)

Yeah, 100%. I think money can buy happiness, but I think that money can also buy misery. Money can buy anything. I mean, it can. And what I mean by that, there's a pat answer. Money buys experiences or money buys stuff that can make you happy? Sure. Money can buy stuff that makes you unhappy. So I'm not saying money always buys happiness, but if you have money, you can do things that make you happier. So that's why. Yes, of course. I think. I think money is dangerous. Like, I think. I mean, I'm a Christian guy. I'm a Bible, you know, believing Christian guy. I was even a youth pastor for a while. And the Bible talks a lot about wealth being dangerous, like, bad. And Christians especially don't like to talk about that very much. Like, it's. It's way more fun to talk about prosperity and how great. Like, when you have money, you can give away a lot. But Jesus himself warns about money more than he does about almost anything else. And so I look at money in a very similar light to alcohol. Actually. Alcohol can make you have a fun time. Like, if you drink alcohol and you're on a bunch of people, you can have a good time. It'll loosen you up a little bit. Great. Is it dangerous? A thousand percent. Does that mean we should never drink? Maybe for some. For sure, a lot of people shouldn't drink. Does that mean I'm never going to drink again? Not necessarily. But I have to be very cognizant of the dangers of money and the dangers of alcohol. You know, they say money reveals who you are. Maybe I think it does. But I think money can also just take anybody and make them worse. If that makes sense. Yeah, you just start. If you're not careful. If you're not careful about money.

C (91:55)

So what, what are, like, the best practices then? If you're. If you're getting more money at a faster rate or. Yeah, you're growing in wealth. Like, what are the things that. Like, is it staying grounded? Is it like having friends that are not wealthy? Is it like. Yeah, giving away money?

A (92:09)

I think it's all of that. I think it's. Acknowledging the dangers of money, I think is step one just saying, like, money can be bad for people. It can be bad for me. It can make me a more greedy person if I'm not careful. It can make me believe that money is a thing that my Happiness is found in or that my validation, my, my self worth is in my money. And if I lose my money. So yeah, things like giving away a good chunk of money I think is a good way to then release that hold of money on you. Like you can't serve. I think that's the famous line in the Bible. You can't serve both God and money. And so you have to stop serving money, period, if you want to. What does that mean? It means it can't control you. And so by giving it away you're saying, hey, this doesn't control me. I can always make more back. So I like making money. It's a tremendous amount of fun to build wealth and make money and help other people make money because money solves a lot of problems. Like I love not being like worried about how I'm going to pay the bills. That's really nice. I love being able to give away millions of dollars to help people that don't have that ability. And I think, I think again from a spiritual side, I think that God has given certain people the ability to make money. That's not so we can buy a bigger jet. Like I didn't think maybe a jet will come someday. But that's not why he made me good at making money. It's not why he made you guys good at making money. I think he made you good at making money for another purpose. So spending your life trying to figure out what that purpose is, I think is a really good way to live your life.

B (93:29)

But what about for the people who sell their companies or they come into a lot of money immediately, they get depressed.

A (93:34)

Yeah, they're miserable. Almost all of them are miserable. And I think a lot of that is because actually because their validation, their internal self worth is in their career and they lose their career. It's gone. And so like that it could have happened with me when I left Biggerpockets, like I was my, that was, I was known as the bigger pockets guy. Everyone knew me as a bigger pockets guy. And all of a sudden it was gone because I just left. But it didn't bother me because I had another thing. First of all, my self, my identity wasn't in bigger pockets. It was in, I mean a number of things, but one of them was it was in my brand. That sounds weird and I know I should say like my identity is in, you know, God or whatever like Christians would say. But like my identity was largely in my brand which I took with me. My identity was in me as a real estate investor. That was part of it, which I took with me. I already had real estate, so when I left part of my identity, I didn't lose all of it, which is, I think, is often what people have. So I think people need to. Before leaving, a company should probably try to figure out where their identity is actually at.

C (94:29)

You mentioned while we were in the boat, once again, I think it was yesterday that every time you've had money since you were a kid, you have a problem blowing it.

A (94:37)

Yeah.

C (94:37)

What do you mean by that? Like, how could, like, like you said, you can't serve two gods. It's like, you're also really smart with your money, but at the same time, you've just consistently just like, bought frivolous things.

A (94:46)

I just, I mean, I like. I like fun stuff. So, like, I. I don't know, even when I was a kid, I just want to go out and buy whatever. I mean, just stupid stuff, right? That's just temporary. And so I just know that about myself. But if I don't have money, I won't spend it on the dumb stuff. Like, when I got. I got some. The company I invested in got soul. I got a bunch of money, and the first thing I did was bought that Ford Raptor that stood out there. Like, I was like, I'm gonna get a Raptor. And then the rest of all the rest of the money, all of it, I just bought this house with, like, the one that we're in right now, right? Because I. I will. I will. Then I have zero problem buying real estate with my money. Like, I will blow my money on real estate, because I know that's just a bank account. This house is a bank account. It's just one that I can't easily access. And I. I bought the house almost in cash. And then someday when I sell it, I get that cash back. So it's just a really hard to reach bank account. Here's the other reason I do that. When I was younger, I used to play a lot of Monopoly. A lot of Monopoly. My buddy, Boone Greenlee. Shout out to Boone Greenlee and I in high school, in the summer one time, we played every single day of the summer. We played a hundred games of Monopoly, I think, over a hundred days, something like that. It was wild. So I love Monopoly, and I'm really good at it. And the reason I'm good at it is because my strategy is to get rid of my money as fast as possible possible. Like, you will never play Monopoly as well as when you have no money sitting in front of You. Because then it, like, then it matters. You're watching a football game. Like, what's the best part of a football game is when the team's down by six points, they've got 90 yards to run or get down the field, and there's two minutes left on the clock. That's the best football you'll ever watch. Because, like, there, you have to win. You have to get to that end of the end zone. That's when they play the best. So I play the best when I don't have just millions of dollars just sitting and making. You know, it's got to be working. It's got to be out there. I got to feel a little bit like, I got to feel broke. If I don't feel broke, I get lazy.

B (96:30)

Do you have any controversial takes about money or any misconceptions that you feel like people have?

A (96:38)

That's a good question. I mean, part of it is that people always say money just refines who you are, and it just makes you more of who you are. I just. I think that money makes you a worse person for most of the time. So that would be probably one hot take on money. I think that people spend way too much time and focused on saving money rather than making money. I think it's way easier to make money than save money. And I think people are like, well, I don't really want to buy that latte, right? And I could pick up, you know, that's kind of a lot of your brand is like, you're like, wait, being. I have never been cheap. Like, I'm the opposite of cheap. People make fun of me for that. I just like, I'm just. Just buy whatever I want generally. But that's because I can. I can go and generate a lot more money a lot easier than I can save $50 a month on whatever. Like, I probably have hundreds of dollars right now in subscriptions that I'm not using across different. I have every one of the video things that are out there. I probably have, let's call it $200 in video streaming services that I'm paying for that I'm not currently really using. I've got kids. I don't watch tv. I don't watch anything. All I need is Disney plus. I've got be fine. Should I go and cancel all of them maybe? Or should that part of my brain just not even worry about that, instead be worried about how can I go and make an extra million dollars for better life that I can give away to Tim Tebow so He can go fight human trafficking and save a bunch of women and kids from slavery. Yeah, that's. That's what I want my brain working on. I don't want my brain ever focused on, like, how do I save another $50?

B (98:01)

But now, do you think that's you? Do you think the average person has the capability to just say, well, I'm going to keep my $200 a month streaming?

A (98:07)

And I mean, there's, There's, There is a. There's a point in your life you need to. To pull that back for sure. And this is not everybody. This is me. There was a moment in my life when I was younger where, I mean, shoot, we, like, we were struggling. I was probably 23 years old, my wife and I were struggling. They just couldn't figure out where there was no money ever. So I read Dave Ramsey's Total Money Makeover, and he's like, give every dollar a name and get the envelope budget out there. And I did that, and immediately I realized I was spending like $1,000 a month more than we were making. We were making like two grand a month. We were spending three. Yeah, for sure. We needed to budget and pull back and do all the work of canceling subscriptions and all that. And so, yeah, have a baseline so you're not stupid. But I just think that making money is more fun and it's easier than saving money.

B (98:50)

Why do you think rich people are seen as evil and specifically landlords. Yeah, they're, you know, a leech on this system and that nobody should be turning housing into a profit business.

A (99:02)

Yeah, because people are stupid. Next question. I'm just kidding. No, I think people are. Yeah, people are. They want what they don't earn. They don't. They want what they haven't earned, and they think that everything should be given to them. I think a lot of people have that view now. Are there bad landlords out there? I'm sure there are. Is it unfair? Yeah, capitalism is kind of unfair. Is it the system we have? Yes. Show me a better system that works for everybody and I would love to learn more, but everything that's tried just doesn't work. Like, what works is capitalism. And so, yeah, I think people just get. People see wealthy, successful people and it makes them feel bad about themselves. And so, for example, if I see somebody with a six pack, my immediate reaction, like, my soul is, I don't like that person. They're probably a bad husband. Right. Like, that's what I'm like, they're probably really bad with Their kids, they're probably horrible. All they do is go to the gym all day. I immediately find ways to make me not like them. Why? Because, like, what do I like? What does it matter if they have a six pack? It's because it makes me go, I don't. I don't have a six pack. And if I don't have a six pack and he does, it must mean that I'm a worse person. I'm. Something inside of me is not good. I don't want to feel that way. I don't like that negative emotion. Therefore, I have to fight that with something else. So I see somebody rich and I'm like, well, they're rich. They must be evil. That is explains why I'm not rich because I'm not evil. That makes sense. So does. Yeah, we. We demonize people because we don't want to internally reflect that it might be our fault. We don't want to believe that we're the bad guy in our lives, but a lot of times we are.

C (100:38)

If you were to start over today, $0,0 connections, but all of the knowledge in your head, could you be a millionaire in a year? And if so, how?

A (100:47)

Yeah, if I was charismatic enough, if I can keep my charisma.

C (100:50)

You're exactly who you are. You just have no connections and no money.

A (100:53)

Yeah, 100% I could. And I say that in a couple of fronts. Let's go with just real estate, because that's what we've been talking about today. I think it'd actually be easier in a lot of other avenues. Real estate is a slower game. But, yeah, I would. If I had all my knowledge and I had my charisma, I could go out there and find a $5 million apartment complex that I could buy for four that needs a bunch of work, and I could go and raise the money and get.

C (101:16)

How could you raise the money if you like?

A (101:17)

Yeah, just go to a bunch of local real estate meetups. Like, there's meetups around.

C (101:20)

No track record.

A (101:21)

You'd like.

C (101:21)

You'd be able to sell it anyways.

A (101:23)

I think I could sell it anyways. I think you just go higher enough. There's a video that Hormozi put out a couple years ago that got a lot of, like, went viral and got a lot of, like, angry people where he said, yeah, it's easy to make a million dollars. Just buy a $10 million asset for $9 million and sell it for 10. And it was. Everyone's like, oh, so easy. Like, why would never one do it. Well, it's not easy, but if I had a year and, like, gun to my head, like, had to get it done. Yes. I can find a $10 million apartment complex for nine, and I could probably sell it for 10. You could. You could. You could do that. You could find a strategy to do that. Yeah, I'm. I'm very confident that wealth is a skill. Wealth is not an outcome. It's just a skill you have, and anybody with that skill can generate it.

B (102:01)

Do you believe in fate, or do you think we create our own destiny?

A (102:06)

I think we create our own destiny within bounds. Right. So again, not trying to over spiritualize everything, but you ever. You heard the story Jonah, like, Jonah and the whale, or Jonah gets swallowed by a big whale or a fish, whatever. It's a science story. But in this story, Jonah, he's like. Like, God was like, you're gonna go to whatever, this city and you're gonna go tell them all that they're being bad. And he's like, no, I'm not. And so he runs the other direction. And then this giant, like, storm comes and he gets eaten by a fish or whale and it spits him back out on the land later on. It's a. It's a great. It's a great kind of metaphor, I guess you could say. And I. It's a story illustrates, like, you gotta follow what God wants you to do. I think that's an exception, not the rule. In other words, I don't think God, or if you're, you know, the universe or fate or whatever, I don't think it says, like, you will go to this college and you will do this, and you'll have this career. But I think there are cases where it's like, you're good at these things. This is the bounds of which you are capable. You are not. Like, you are charismatic. You're good at talking to people, you're good at money, and you're good at this. So therefore, you're like, that's probably the general bounds and area you're going to go. So anyway, I think the Jonah thing, I don't think fate says you will do this exact thing. I think that's a rare occasion. I don't think God's telling me to go and build a real estate empire. I think I chose that. But within the bounds of the skills that I have.

C (103:19)

You mentioned that you think women are more attracted to guys that can demonstrate commitment and that growing a large beard is exactly that.

A (103:28)

That's it.

C (103:28)

Is this just coping Is this just coping?

A (103:32)

It might be a little bit of coping, a little bit of making myself feel better about the beard. Uh, no. But I really believe. I think that there are just signals that a guy can give off that signal to a female, and the same thing works the other way around, that they will be a good mate. So whether that's a biological thing, an evolutionary thing, or just a common sense. Right. Like, a guy who's bigger is generally considered more attractive than a guy who is smaller. Like, if you have no muscle whatsoever, a guy who talks really, really quiet and small is not as attractive as a guy who's got a big, loud voice. Why? Because it signals, like, protection. It signals power and leadership, which then is from a. Again, kind of, hey, I can protect the people in my life. So the beard. The beard tells one of two things. It either tells the woman that this guy can commit to something for a long period of time. Just like a guy going to the gym, he can commit to the gym, he can commit to a beard, or it tells the woman that you're trying to cover something up. I don't know. Maybe I have a really weak chin.

C (104:30)

You know, I. I respect the beard a lot because if I see someone walking around with a beard as miraculous as the one you have.

A (104:36)

Miraculous. Never heard of that. That way. Thank you.

C (104:38)

Automatically think, like, this is. This is a really just persony person. Like, they. There. They have something to them that makes them a lot of whatever they are.

A (104:48)

You know what I mean?

C (104:49)

And, like, they're. They're at least very sure of themselves. And I think that that's. That's a good thing.

A (104:54)

I agree. I think that a beard makes you kind of a caricature of yourself, and I don't think that's a bad thing. I think that there's too many vanilla people in the world. And so whether it's. Whether it's a beard or cool glasses or interesting haircut or the way that you talk, or you're Alex Formosi wearing, like, cutoffs and, like, the big muscle shirts. Like, it just adds, like this. Like, oh, that. That's a. That's a. That's a character. Yeah, I like characters.

B (105:16)

Does your wife like the beard?

A (105:17)

She does. I always say, like, actually from the beginning, I said, oh, when people say, how long do you want the beard to go? How long you let it go for? I'm like, as long as my wife likes it. And every length it's been, my wife has liked it even more. So I'm going to keep it going. Until she doesn't like it.

C (105:28)

Does she grab it?

A (105:32)

No, I don't, I mean, I don't think, like, no, I don't think she grabbed my kids. Grab it. Like this is a handle for the kids to get my attention. Like they crank it. But yeah, it's fun. It's a good, it's a good, it's a good way to go through life.

C (105:44)

How much would it cost to shave it off?

A (105:46)

Millions. Like, I'm not even kidding. If you offered me a million dollars right now, I wouldn't do it. Not a chance. 10 million. We could have a conversation. 10 million to charity. Okay, fine, we'll, we'll, we'll have that talk. But it's too much. Too much. My identity. I mean, I, I, my Instagram is beardy, Brandon. Right? Like, I mean, it's my, like it's a big piece of who I, who I am and. Yeah.

B (106:07)

How long would it take to grow it back?

A (106:09)

This would probably take about three years.

B (106:11)

Three years to get to that length.

A (106:12)

I said I'd guess it doesn't grow anymore. It stays right here.

C (106:15)

So you don't trim it anymore.

A (106:16)

I mean, just like the crazy flyaways. But it's, it's about this long.

C (106:19)

The thing is, it has a, it has a shape to it.

A (106:21)

Which shape it. Yeah.

C (106:22)

Okay, you do shape. And then over at barber, this is all, you know, done like the sides and everything, because it's not like, you know, it's not wide for a.

A (106:31)

Long before I started going to an actual good barber who knew what they were doing. Like, I just let it go and it started just looking like a homeless person's beard. Cuz when it just goes out. And so I learned that good barbers will shape a beard into something. And there's a lot of different styles. And this is just the one that she picked. And so interesting. I go with expertise.

C (106:47)

It's very cool.

A (106:48)

Thank you.

C (106:49)

It's so, so rare.

A (106:50)

Do you want to touch it? Yeah. You know, you ever seen that episode of Family Guy where there's like two bald guys in an elevator and then there's a third one that's not bald, and then they're sitting there in the elevator and then the, the haired guy leaves and the two bald guy look at each other and go, I thought he'd never leave. And they lick each other's heads.

B (107:06)

What?

A (107:06)

Yeah, that's what bald guys do. So, so bearded guys. You don't know this because we don't do it in front of you. When guys with long Beards see each other. We wait until everyone's gone and we go up and we like Avatar, that thing, you know, Avatar where, like, the hair meets. Yeah, yeah, we do that. We, like, we rub our hair together. Wow. We form a bond.

C (107:24)

Feels very good.

A (107:24)

Yeah, dude, It's. It's magical, actually. Like. Like, it's beautiful. It's a beautiful moment.

C (107:29)

I'm going to. I'm going to have a beard like that at some point in my life.

A (107:31)

I think you should grow it out. I think you should just from right now, this point forward, grow it out. You demonstrate commitment, hardcore commitment.

C (107:38)

That'll do it. If I end up finding a wife.

A (107:40)

Because of it, you owe me. I.

C (107:41)

Big time.

A (107:42)

Last time I was on this podcast, we talked about, you needed a haircut in order to find a wife. So this time you need a beard. This is. This is the focus of our podcast.

C (107:49)

Who knows what it will be in a couple years? I'll need something else.

A (107:51)

Muscles. Huge.

C (107:53)

That's definitely.

A (107:53)

But only on one half of your body. That's commitment. That's commitment.

C (107:58)

It's restraint because you're not working out.

A (108:00)

Both.

C (108:00)

But it's also, like, commitment because you.

A (108:02)

Can show them and you're a character. Win, win, win.

C (108:04)

That's a good point.

A (108:05)

I think we figured it out for him.

B (108:06)

What about any relationship advice that you have?

A (108:10)

You know? Yeah. Heather and I, we met in college. She was the first girl I ever dated, first guy ever kissed, called my shot, my star from my dorm room. I said, that's the girl I'm going to marry. And I went down there and, you know, four years later. Yeah. Four years later, proposed. Man, I want to steal a line from Esther Pearl. Esther Pearl. Have you guys ever had her on the podcast?

C (108:30)

No, but John Deloney references her all the time.

A (108:33)

She's amazing all the time. Yeah. Esther Pearl says, in your life, you will have five marriages. I hope they're all to the same person. And I. I think about that quote every day, because what I'm like, what I take that as is like, the marriage that I had with Heather before kids was fun. We went to Europe, we traveled around. I mean, Graham, you're in it right now. It's a fun marriage. It's great. The marriage with little kids is a totally different marriage. And so many couples don't make it through that marriage. This is a different marriage. And if all you do is lament the marriage you used to have and say, oh, I mean, like, I did life. I used. I used to have that. It was so Good. Now I've got this hard life with little kids. Like, you're going to always be miserable. And then the next marriage, when you have older. I'd say, like, older kids. Right. That are like teenagers, that's totally different again. And most people don't. They don't make it through the transitions, and they lose themselves in the process. And then the marriage, like, after the kids are out of the house is real tough for people. And then when you're old, you have that marriage, and it's a. Again, a very different marriage. So my best advice is just what I heard from Esther Pearl is like, focus on the transitions and just accept that that marriage is over for now, and there's always going to be pieces again. But, like, I will never again have that marriage with Heather. That's okay. It was beautiful while it lasted. Now we have a new marriage, and this marriage is beautiful as well, even though it's hard and challenging and difficult and. Yeah.

B (109:52)

Do you have any book recommendations for anyone watching? What are your top five?

A (109:56)

Oh, man, I'm such a reader. I love reading new. The newest one, my favorite book is always the one I'm reading. Like, I just get into every book, and I'm like, this is the best. Don't believe everything you think by Joseph, like, Nguyen. I'm not exactly sure to say his last name, but don't believe anything you think was phenomenal. It's kind of a book on, like, almost Buddhism. I love that one. The one thing. Gary Keller, Jay Papazan. The one thing is it's about focus. I just apparently don't follow what I read, but I love the book. The one thing I absolutely love, the compound effect from Darren Hardy. It's like, do the action over and over and over. That made a big impact on me. I'm gonna say from a. It's not a business book. It's a fiction book, but I think it's one of the greatest leadership books ever written. I loved it. Is Red Rising. Have you read that one? Fun.

C (110:40)

Yeah, Mikey.

A (110:41)

Yeah.

B (110:42)

Oh, yeah.

A (110:42)

It's such a good book.

B (110:44)

Hey, Mikey.

A (110:44)

Yeah, Mikey. What's up, Mikey? Good. Good choice of books. Red Rising, you can get at Target. It's like, a popular book, but in terms of, like, how to lead and inspire a team. Like, it's like, I want to be Darrow. Like, I even thought about naming my kid Darrow. He's like the main character. It's like, dang, that guy. Last book, man. It's like, like I said, it's always the one that I'm reading. But we'll go with rich dad, poor dad. I gotta give it to kids. I mean, that's classic. I interviewed 500 people on the BiggerPockets podcast. Real estate investors and millionaires. 90% of them named that book as the book that, like, most impacted their life. And when I got interviewed, like, when it was my turn to be interviewed, I would always say that book. Yeah. Like, when people ask me, it's. It changes your mindset more than any other book in the finance space. I think it just alters how you think about money and wealth and building it, and it makes you believe, actually internalize. I could be wealthy someday. I could not struggle. There's a different life out there. It's like looking through the Narnia, like the cupboard door, and be like, oh, there's a whole other world in there.

B (111:50)

Yeah.

A (111:50)

Blows people's mind.

B (111:51)

Yeah.

C (111:52)

And you didn't ask us to do this, but. Because I think it would actually help out a lot of viewers here. You have like a coaching thing, right, where you help people get through buying their first property and if they don't in the first year, then they get all their money back or something.

A (112:05)

Yeah, yeah, yeah.

C (112:07)

And it, like, there's a guarantee that is.

A (112:08)

Yeah, yeah.

C (112:09)

The guarantee is that you will buy your first property.

A (112:11)

Yeah, there's a lot of. Okay, so, yeah, there's a lot of, I don't know, D bag real estate influencers out there that'll charge, you know, fifty or a hundred thousand dollars. Like, I'm gonna help you be a real estate investor. And then people go into it and then they don't buy anything, they never do anything, and they take advantage of people. It's. It's a really shady industry in a lot of ways. Like, do you know, like, do you know about this practice? Like, you'll go to like a. A seminar. It's not just in real estate, but you go to a seminar for like a weekend boot camp. Fine. And day one, they're going to teach you negotiation skills. That's what you need to succeed. We're going to teach you how to negotiate. Well, what are we going to practice on? We're going to practice on your credit card companies. We're going to get you to raise your credit limit on your credit card. That's how you're going to practice negotiation. So they call up their credit card companies, they do the script, and they raise it from 5,000 to $25,000 the next day. Guess what the price of the program is and I've seen these documents from some of these companies. It's blank. They leave the price blank so they can flip, fill the price in when the sales guy's talking to the person with the price that their credit card was just raised to. It is so shady. I hate that stuff. So, anyway, so I have a. I have a program. It's called First Deal. It's literally how to get your first deal. It's like six grand. And then, yeah, if you don't buy a deal but you did the work, you get your money back if it doesn't work. But I. I don't think anybody's gonna ask for the refund because either you get a deal, you didn't do the work, or was you gonna keep working with you until you did? Like, it's not like the desire for wealth goes away. Yeah, so, yeah, we just. I just meet with people every single week on a group call and we have a bunch of advisors. So, anyway, first, if you guys want.

C (113:34)

To buy real estate, link down below. You didn't ask me to do that, but I want it.

A (113:37)

Yeah. Yeah.

C (113:37)

Thanks for coming on the show.

A (113:38)

You're a good man. You're like a good wing. He's a good wingman, you know, like, yeah, you're like the guy at the bar who's like, yeah, my buddy over here. He's got a good thing. Anyway, yeah, thanks, man.

C (113:46)

Thank you for coming on the show. Thank you guys for watching. It really means a lot.

A (113:49)

We flew to Hawaii just for this.

B (113:51)

We had to fly to Maui.

A (113:52)

You had.

B (113:53)

We had.

A (113:54)

So, so hard. Yeah. Oh, it had the worst hotel room ever. I know. Put up with.

C (113:58)

Yeah, that was.

B (113:59)

You appreciate us being on a six and a half hour flight to get here for this for like two hours for. We spent 12 hours on an airplane for two hours of a podcast. Hit the like button and subscribe. That's it. It would mean the world to us. And it's free to subscribe. Just hit the subscribe button. That's it.

A (114:18)

Thank you, guys.

C (114:19)

Or don't if you don't want to.

A (114:21)

You don't have to. Yeah, you don't have to. You don't want to.

C (114:23)

Spice of the next nerd. Thanks for watching.

A (114:26)

Until next time, thank you for tuning in to another episode of the Better Life podcast. We hope you enjoy the show. I hope you got some valuable insights to help you lead a better life for you and your family. Now, hey, if you found value in this episode, please consider leaving us a rating and review on your favorite podcast platform. Your feedback helps us to improve. The show helps us reach more people with this message of living that better life. And be sure to subscribe to the podcast so you never miss an episode. And hey, before I go, this show is all about the habits, actions, beliefs and strategies that can give you a better life. But in case you're interested and you want to know my opinion on what it takes to live the best life, not just better, and that's from like a more spiritual and faith standpoint, check out abetterlife.com bestlife thanks again for listening, and we'll see you next time on the Better Life podcast.