B (2:37)

Yeah. But the other side, like you said, like, I remember the first couple I ever went to, like the first couple sales conferences and the first couple of real estate conferences. Yeah. When you're new, it's like a fire hose and you're like, well, I don't even know what to do with all this. Yeah.

A (2:51)

I also think part of it's because there is so much content out there. There used to not be podcasts, There wasn't as many books that were written. So the only way you learned was you either went to a conference or you had a mentor. Now you can have this in your head eight hours a day as you're just driving in your car or whatever. So the information isn't always new. So now you gotta try to figure out a way when you're presenting or you're making a podcast to get the information through. Like, how do I get it to click in your head what it's gonna take? Cause you've been in real estate a long time and you've seen the patterns of what works and what doesn't work. So that's a good segue into your story. Why don't you start off telling us? I believe it was in Hawaii when you got started. Is that right?

B (3:28)

Yeah. So kind of going quick, way back, I. I tell people I got interested in real estate when I was about 10 years old. I grew up my family. I don't want to say I was poor. We always had a roof over our head. We always had food on the table. But, you know, it was a very paycheck to paycheck life at best. And from time to time, my parents would argue about money. And there was this one day I was outside. Now, keep in mind, no, I didn't know anyone that owned real estate. No one in my family ever owned real estate. So I was. There was this kid down the street. We used to ride bikes and skateboards together. And one day I asked him on like a Saturday morning. I'm like, oh. I'm like, my landlord's over talking to my parents. I guess the rent's like, who's your landlord? And he said, oh, no, my parents, we don't have a landlord. They own their house. And I'm like, huh? No, everybody has a landlord. And he's like, no, we own our house. And it just kind of clicked with me then. I'm like, really? I didn't know that was a thing. And then it occurred to me, wow, they have nicer cars. They go on vacation every year. They go to private schools. Maybe there's something to this owning real estate thing. And I just, it literally stuck with me from then. And I got into real Estate in 2001. I had been an auto mechanic for a little while, became a service advisor after an accident, basically cutting off my middle finger. Had to sew it back on. And so I wasn't able to wrench for a while. And they put me on the desk and turns out I was pretty good at it. And I then got an opportunity back in Honolulu. I had moved around a little. I get back to Honolulu and I get offered a job at the Jaguar Ferrari dealership as a service advisor. And I was like, wow, I don't have very much experience. That's my first lucky break. Did that for a couple years. And that's where I started meeting a lot of realtors. A lot of the top realtors and top business people in town had Jaguars. And I started bothering them like a three year old kid. What's this? How's this work? How do you do that? Tell me about that.

A (5:29)

Is there a joke here about the fact that you're a mechanic and all the people with Jaguars were like dropping the cars off at the shop or something? Because Jaguars are always breaking. And that's how you meet rich people.

B (5:40)

They. I, you know, maybe it was interesting. Yeah, that, that's what a lot of people with older Jacks too. Like, they would break all the time, but they didn't care. They're like, no, but I love this car. And yeah, there is a whole. We could talk for hours on that. But that's.

A (5:56)

That's right. So you're meeting people. There's so many people when I was hosting the Bigger Pockets podcast that said the same story. I was an accountant. All my wealthy clients had real estate. I worked in the nice restaurant. All the people that were coming in ordering steak and lobster.

B (6:11)

Real estate.

A (6:12)

I was a lawyer. I was. What you were saying you're working in the, what was the first job you got in Honolulu?

B (6:19)

I was a mechanic before that. So it was, it was really. When I got.

A (6:23)

Was it the service department you said.

B (6:24)

You have the service advisor side is when I really started meeting people that were in your front facing agents and, and people that owned a lot of.

A (6:32)

Real estate dropping off their nice cars. Yeah. So I mean it's crazy when you think about it. My, my thought is real estate is such a powerful wealth driver, mainly just because it is a hedge against inflation that the country just destroys the value of the currency. And you could buy gold, you could buy real estate, but gold doesn't pay you rent and you can't use loans to buy gold as easily as you can real estate and you can't improve gold. So real estate ends up being the thing for the creative people that like to tinker with stuff and play with it. And there's a lot of opportunity in different areas to build.

B (7:06)

We.

A (7:06)

But basically it's really hard to make houses. It takes a lot of effort. That's why gold keeps up with inflation. It's hard to get it out of the ground versus money you can just print. Do you have a different perspective on why real estate builds wealth so well, being in the game as long as you have.

B (7:22)

No, I agree with, you know, I agree with you on most of that stuff. When you go down those roads of real estate and I have these debates with people all the time, especially now when the market's gotten tougher, you know, prices are high, rates are still up there, inventory is still relatively low historically. But having been in it for 25 years, even when I wasn't actively investing earlier in my career and I made some financial mistakes and wished I did invest more, I've seen other clients and other people and over time it just works. You know, I, I was actually looking at some data, getting ready to talk with you and just thinking it back to the financial crisis and I got burned back then myself. Everybody talks about how horrible it was and all these foreclosures and it was really, really bad. But at the peak of that entire thing, only about 5% of properties got foreclosed on in this country. And we don't hear about all the people that bought their house in 05 or 06. They were smart, they didn't have a crazy mortgage. They held onto it, they wrote it out and 10, 15, 20 later years later they're golden, you know, because they were patient and they were responsible about it.

A (8:35)

Yeah, that's when I got in was 2010. And I was told by just about everyone I knew, you're an idiot. Why would you buy a house? Everyone knows real estate's the worst thing to buy. Just rent. It's safer. And I was honestly, at that time, shocked at how fast it turned around. Y. I sort of had this impression that, man, like, it crashed so hard. This is all I hear about the news. It's going to be decades before we climb out of it. It was literally the summer of 2013 in California, and it went from. Every house is on the market. No one's buying it. It hit a certain point where all the investors jumped in and were like, oh, it cash flows. And in one summer, it went from no one touching houses to multiple offers on every single house. And it just took off running. And I had actually got so unaffordable, I couldn't buy in California. That's why I went and bought in Arizona. And that's when the long distance thing came to be. So that was my crash course. And the fact that real estate tends to just be like, it's very harsh. It moves in one direction really quick. It moves in the other direction, really. And you have to have the constitution, like you said, to hang in there, and it will come back.

B (9:34)

Yeah. And I think about the market now a lot. And again, it's all relative. Right. We talk about how tough it is if you got into real estate four or five years ago, when rates are 3% and you put 20% down on anything, and you're getting a 10, 12% cash on cash return, and then it went up 10, 15% in the year. That's all you know. Right. You talk about Vegas. We were just. I saw you there, too. I gamble a little bit. If you came to Vegas with me this last trip, and you'd never been to Vegas before, you think Vegas is the funnest place in the world. Because I actually won money every night. Yeah. Every three nights in a row, I won money. So somebody who's never been there before. Oh, my gosh, this is amazing. Yeah, I. I've been to Vegas a lot. That's not normal. That's not how it goes. And I feel like real estate is kind of the same for people that saw it five years ago. They think that's just the way it is, and it's not. You know, that was. That was the. That was the lucky night in Vegas. And you may not see one again in your lifetime. Yeah.

A (10:36)

And then you. You never hear. I guess in Vegas, people may say they lose money, but it Would be as if no one wanted to admit that they lost money gambling because no one want. If you lose money gambling, you're like, I was supposed to lose. But if you lose money in real estate, you're an idiot. So no one wants to admit that. You only hear the stories of the people that won't.

B (10:53)

Yeah.

A (10:53)

So you get this impression that everybody wins in real estate and you're the only one who's not winning. And that could be very discouraging. But you've been around for a long time. So, like, what were your thoughts on just. If you could go back, you're in Hawaii and you're realizing people are into real estate, would you have done it the same way you did it, which we're going to get into here, or would you have done anything different?

B (11:14)

I. How much time do you have? No, I would have done it very, very different. So kind of go back to when I the job I had as a service advisor again in my family, as far as everyone was convinced, I'm done. Like, I got a, you know, I was making almost 60 grand a year at 22 years old with benefits and vacation. I was making more than most people in my family. And they're like, no, you're set for life. But I knew there was no upward mobility. And I also hated working in a job where I'm a fast worker. I when I'm focused, I'm focused. I'd be done with my work by about 2 o' clock every day and I'd have to stay there till 5 or 6 o' clock every day. I'm like, what am I doing here? This is a waste of my time. I could be working on something else. I could be hanging out with friends. I could be doing a hobby. So that's where the real estate thing came in. And I was talking to sales agents that were very successful and one finally convinced me to go. Got my license, got the training, quit my job, family almost disowned me, thought I was completely insane. And it's a grind. The first year I made less than half what I was making at my job. The second year I got almost even from there, I started really making good money, you know, into the six figures in my mid-20s. So to answer your. That's a long answer your question, no, I would not do things the same. Because when you take a. Someone in their mid-20s who has never had money and doesn't have a lot of financial literacy and starts making six figures, a lot of good, not a lot of good decisions are made.

A (12:49)

Isn't that the truth?

B (12:50)

And there definitely were not podcasts that I could listen to every, you know, there weren't three, four people putting out two episodes a week that you could listen to every day in 2003 and four to. There were books out there, there were courses, but you'd have to dig to find them and they weren't. But some people don't realize how much you can get for free nowadays. It's just.

A (13:10)

Oh, I know. Yeah, it's almost, it's almost a problem that there's so much. I open YouTube every day and I'm like, oh my gosh, there are so many things to choose from and there are so many videos, it can feel overwhelming. And then you get stuck in the real doom loop where you just can't get out of it. They're just sucking you in for 30 seconds at a time.

B (13:28)

Totally. And that's the other side of it, right? There's, there's a lot of really good free information out there. But it's the 80, 20 rule. 80% of what's out there is absolute garbage, you know, and so that's the bad side of there being, you know, anyone can record a video or audio and put it on YouTube or on Spotify or Apple and claim they know what they're talking about and they don't. So that's scary.

A (13:53)

Yeah, that's 100% true. Before we get into your story, what advice do you have for people when it comes to picking who to listen to? Because I think this is pretty important. How did you learn like who is full of it and who you should be focusing on?

B (14:07)

I, I look at where they're at and what they're doing and what they've accomplished. I, I do this in property management a lot and this is kind of one of my sales pitches. In my property management, I own 12 long term rental doors myself. They are managed in the same system that I manage clients properties in. So I asked them, who's your property? You know, I hope you interview other people, ask them about their portfolio, do they manage properties and how do they manage their properties compared to how they're going to manage your properties? Because if you work with us, your property is literally getting plugged into the same systems and processes that I use on my very own properties.

A (14:49)

Yeah, I mean that is was my theory for a long time because I never managed my own properties almost my entire career I gave them to other people. And I found there was a pattern of two kinds of property managers. There were people that wanted to make money. So they started a business and they said, let me manage your property and you could get a good one. But overwhelming majority of the time, I got a person that I want to get as many doors under control as I can, and I want to hire the cheapest people that I can possibly hire. And I'm going to let my employees figure out the systems of how to do this. And there was constant turnover and there was constant. I forgot we were supposed to do this, or I'd be like, hey, did you consider marketing it this way? Oh, that's a great idea. And I'm like, everywhere I go, I end up teaching my real estate agent, teaching my property manager how to. They're supposed to know more than me. I was so frustrated. That's why I became a real estate agent. Honestly was, I was referring my buddies to agents, and they would come ask me questions, and I tell them what to do, and they're like, my agent said, you're brilliant. It's like, well, your agent should be paying me, right? So I went and got a license. And then the second type of property manager was the people that owned real estate, learned how to manage it, got good at it, and said, you know what? I'm already doing it. I might as well do it for other people. Like, I do it for me. And those people every time had the better systems, the better pricing. My properties performed better. They anticipated things going wrong. They didn't wait for something to go wrong. They had solutions in mind. They already had the vendors. They had people that would. That would not charge me exorbitant rates because that's who was working on their own house. And that became what I would look for when I'd interview them. I'd be like, how many doors do you have? If they didn't have much of their own, I didn't care how many they managed for other people. Sometimes the people that manage like 2,000 doors, that just means, oh, so you got eight W, two employees that hate their jobs. That doesn't sound like the person I want, but that's an outside perspective. You've been in this a long time. Do you think that there's more that should be considered there?

B (16:41)

There is, but you're not. You know, what you're saying is, is totally true. And I, I agreed with you. You know, you've preached for years about, it is way too easy to be a realtor and it's way too easy to be a property manager, meaning it's way too easy for someone to get their license and do it. You know, when you're a sales agent, you're the vast majority of people you're working with. This is the single biggest financial decision of their life. And you've got people that took a six week online course and passed a written test and suddenly they're qualified to, to do that. You know, not the case. And then with property management, to me it's even next level because now you're managing assets and you're literally people's money every month. You know, if you've got a couple thousand doors, you've got millions of dollars of rent coming in that then you're processing out every month and think about who's doing that for you. You know, what's their experience, what's their systems. I've seen some scary stuff back in Hawaii, a couple of companies that went under and, you know, the government takes over to liquidate the company and the security deposits are gone. You know, half a million million dollars just gone. They've, they've scanned it out. So not trying to scare people, but it is. Yeah, you got to think about what you're doing. And on the other side of the spectrum is the, is the consumer, right? Nine out of ten inquiries that we get someone looking for us to manage our property. What's their first question? I want you to rent my property. How much do you charge? That's the same with sales, right? How much is your commission? Yeah. Oh, my Lord. Not what are your safeguards? How much do you charge? It's like, well, we'll get there, but let's talk about what we do first.

A (18:28)

Oh, God, that's. We could do an entire podcast on that topic. Maybe we will. And you know what's funny, Jeremy? I see this. That thing runs through every element of real estate. And I am not saying this just because I am the guy who charges sometimes because I'm also the guy that pays. So I sit on both sides of this. I hire real estate agents to sell my houses in other places. Right. And I don't say, what's your, what do you charge? Or in the real, in the mortgage industry, it's what your rate. And we teach on mortgage Monday all the time. The reason that's such a stupid question to ask is because I can legally tell you, like right now, I could say my rate's five and a half percent. Oh, that sounds great. Everybody else said seven. I'll go with you. But what I didn't tell you is that's with four points, right? So that's a $60,000 loan. And you're like, you would never do it, right? But if you're just asking, what's your rate? I can say that. Or if you say, what are your fees? I could do the opposite. I could do zero fees. Well, and I'm not telling you that's a nine and a half percent interest rate or something. So it's the same. Like I hired a real estate agent in Florida and I didn't do the hiring. I let one of my staff do it. And they are a little bit more inexperienced than me. And so he's a charming guy. And he answered the phone right away and he's like, yep, I'll get on it. And they're used to the realtors that never answer the phone. So they said, this guy's amazing. I'm like, okay, he wants to do a six month lease or a six month list agreement. I said, no, I don't know him. I will do two months. I want to do one, but I'll do two. The guy goes in, I pay him. I think I'm paying him a 2% commission because I'm like, I usually do 3% if they're really good. But I didn't know him. And this was a. Should have been a layup. I price my house 100k less than all the other homes it's recently rehabbed. The dude takes pictures with his cell phone. Does it get the grass cut before he does it? And not only does he take pictures with his cell phone, he puts seven pictures in a row of the front of the house. From all these ugly angles, it is the most hideous. Like if you look to the picture on my property management page because it's a short term rental now. Looks amazing. The backyard's the first picture. We got a sunset like a twilight look. It looks very fancy. This thing looked like a bag of trash when he marketed it and it never sold. And I finally was like, I don't get how we're not even getting showings. And I looked at it up on, you know, Zillow and was like, oh my gosh, my heart sank. But that's an example of like, that's the realtor who says, I'll do it for one percent, I'll do it for one and a half percent. That's what they're going to do. And then they're going to not pay any attention. They're not going to be getting information from the other agents. It's really only the top 5%, 5 to 10% of agents you even want touching your house and they're not going to be cheap. But like this is a $700,000 home. You know, like to save 1%, 7 grand to lose 40 or $50,000, it doesn't make sense. But you've watched this over time and you've seen this all the time. And it's the same with management. Like, how does this manifest with property managers with saying, yeah, I'll charge you less, Are they getting you, are they nickel and diming you somewhere else? Or is it just because they're not as good?

B (21:24)

It's, it's all the above. So there's a lot of business models. So our, you know, like our company, we do is 10% of rent collected, end of story. That's it. We don't do leasing fees. I don't do, you know, all these other fees. And then there's companies that may say, oh well, we'll do it for 8%, but we have a 20% placement fee when we put a new tenant in. And then we mark up all maintenance invoices by 5% or 10%. They have a lease renewal fee, you know, they have an inspection fee. There's all these other things and you start adding it up over time and, and I'm not putting down any other model. You know, there's different in every, in every industry in this world. There's different models, different fee structures. Yeah, but you got to know what you're paying for and what you're getting for it. And, and that like you said, it's like with the rate. Oh, I got five and a half percent. Well, yeah, but you got to pay four points first. You know, property managers charge 8%, but they're getting you on $3,000 of nickel and dime fees through the year. So.

A (22:27)

All right, so you're in Hawaii. You're, you start a property management company there.

B (22:32)

So I, I did if you wanted. Before that, I was in sales for about nine years.

A (22:37)

Selling real estate.

B (22:38)

Yeah. Yeah. Okay.

A (22:39)

Well, yeah, let's talk about that. Like, when was that experience?

B (22:42)

Like, well, that was. Like I said, I got out of the service advisor job and I started selling and had some great mentors along the way. As you know, it's a grind in the beginning, especially being young. You know, I was. Prices in Hawaii have always been high, you know, so like back in 0203, our median home price was already like 700,000, you know, so being a 24, 25 year old kid trying to convince people to work with you on million dollar houses was Tough. But I did it. I stuck with it. I did open houses. I did a lot of the referral programs to get my business going. You know, Navy Federal, usaa, that was a great niche I found when I started out because more seasoned agents didn't want to do them. Because these buy well, they take a referral fee. Right. USA or Navy Federal is taking 25, 30% of the commission. But even then I'm like, well, they're taking 25, 30% of the commission. But I'm young, I got time. I don't have other clients. And these are people that have been pre approved on a loan, they've committed to a move date, they committed to a neighborhood and price range. So often I'd be showing them houses a few days and you know, we got an offer, we're done. So that, that, that launched my career the first couple of years between that and then sitting open houses. Open houses was a love hate relationship. I loved open houses. Excuse me. I was very good at open houses. I hated doing open houses. I would pick up a client pretty much every open house I sat and all my friends are at the beach or at a barbecue or out fishing on a boat on a Sunday afternoon and I'm Sweating in a 90 degree house in business clothes trying to look older than I am.

A (24:20)

Yeah, man, that is so, so funny. Because I was the same way. I did not love people. I didn't love meeting strangers. I didn't love trying to figure out, are you full of it? Do you think I'm full of it? Like we have to do this awkward dance. Every single person that meets you're walking in, not wanting to talk to me, just wanting to see the house. I don't really care if you see the house. I just want to figure out if you're a client. It's an awkward thing that we have to pretend like it isn't. But I just got really good at it. And I don't even think I was that good at it. Jeremy. I think most realtors were just so bad that I looked. Yeah, but compared to them, I look good.

B (24:55)

Yeah, I've always. So being in the car business before real estate, I didn't do car sales, but I knew a lot of the salesman. And when I started doing well in real estate, I was still in touch with some of them. Like, I'm going to get into real estate sales. I'm like, I don't think so. And what I tried to explain to them, what I learned is to me, real estate sales is not sales. It is customer service. You. You have clients that have a need. You want to educate them and teach them how to get to their goals in the best way. Right. So open house, Obviously, your first job there is to show the house that you're sitting, talk about the features, then you're talking to people coming in. You're learning about them. What are they looking for? Maybe this is the perfect house. But, you know, nine times out of 10, probably 99 out of 100, the person walking into an open house is not buying that open house.

A (25:42)

Right, right.

B (25:43)

You know, so you're meeting them. How can I help you? What. You know, what value can I bring to you? It's about helping people and learning what their needs are. It's. It's not used cars. You're not gonna. What. You know, what do I have to do to put you into this car today? You know, it's not right. It's not how it works.

A (25:58)

No, not at all. But that is how they get treated a lot of the time. A lot of agents do that. And to be fair, I don't think most agents understand real estate itself. They don't own it. They don't do anything other than try to sell it. They're more of, like, people persons, I guess. Like, and that's kind of why. So they. The top ones are so slimy. They're good at reading humans. They're good at pressuring you or luring you or presenting information in a way that makes you feel safe. They don't always understand the fundamentals of it. And so when they would bump into me, and I'm like, well, did you know property taxes are higher on this house than across town? Or let me tell you how special assessments work? Or did you realize that you can avoid the. The mortgage insurance on a loan if you go this direction instead of that without putting 20% down? No one talks about loans. And I would just get, like, a couple. I would bring a little bit of doubt in their mind. Oh, your agent didn't tell you that or. No one explained it. Why don't you guys come to my office this weekend? We'll sit down, I'll give you a presentation. And I probably had a 90 close rate. Once they had the presentation, they're just like, oh, this guy knows a lot of stuff. I feel good. I'm glad I met him. I'll go with him.

B (27:01)

Yep. So, yeah, so that kind of took off my sales career and started doing very well, and like I was saying earlier, doing very well and very not so well. In that I'm, you know, I'm in the top 5 ish percent of agents in the Honolulu market at this point. I'm doing good work. I'm, you know, getting my top producer of the month for the office awards from time to time and all that. And I'm, I'm 26 and I'm, I think I'm hot stuff and making good money and all the people I grew up with. That said, you'll never make it. You'll never this, you'll never that. Well, is Jeremy taking every dollar he can and investing it into an IRA or into a rental property or into that? No. Jeremy's leasing a fancy new car every year, and Jeremy's taking friends out for dinner and drinks on Friday and taking expensive trips. And I don't think any of those things are on their own bad. I think you need to reward yourself. But what percentage of the budget should that be? I guarantee you I was ten times over it. And that, that, that's the part if I, you know, I've, I've done the math and I look back, I could have still had a decent lifestyle, plenty happy, everything I wanted. And from 03 to 09, if I just was a little smart, a little conservative, I could have invested $450,000 a year in other years. So that's what, Half a million dollars. Put that at 8% compounded over the last 15, 18 years.

A (28:49)

But no one talks about it. Back then. There was. You had to have a mentor or someone that pulled you aside and be like, hey, young buck, you should think about this. There were no podcasts. There was no social media.

B (29:02)

Well, so this, yeah, so this is how. And I did have that. And I'm very fortunate. So, you know, fast forward through all that. I'm, you know, I bought and sold a couple properties. I was proud of myself there. I owned a house. At least I was saving some money. I wasn't blowing at all, but I should have done a lot better. But then comes 08, 0908, I still had a great sales year. It was actually my best sales year, ironically, because I was not working with people doing those crazy loans. But I myself got one of those crazy loans. It was 06. It was a tough personal time in my life, and we'll get into that. But there was a lot of stuff that happened, and I had a lot of changes and I had, I sold the house. I had, and I bought another property. It was a, I bought it because I saw the opportunity. This could be a triplex it was a house that had been added onto twice. And I'm like, oh, this is great. But I'm a sales agent. I'm 1099. I am being legal but aggressive on my taxes. So I don't make a lot of money on paper.

A (30:03)

Of course.

B (30:03)

Yeah. And you talked about, you know, people that don't, that are W2 don't get that side of things. But you know, if you're W2 and you make $10,000, you go to, you know, the one brokerage, okay, you make $10,000 a month. Excuse me, if you're independent contractor. And I make 10,000amonth. Well, I have a car payment, but that's a business expense because it's a business car. My cell phone, my computer and my Internet and on and on and on. So by the time that's all done, I only make four grand a month on paper. Well, you can't qualify for much of a house in wire for four grand. So I do. I did a stated income three year arm. Sorry, we're talking about this throat thing. It's getting me a little bit.

A (30:49)

Yeah, we're gonna give Jeremy a break here to take a drink. We both were on beef pecan and caught all the germs from all the people and I came back with strep throat and he came back with a sniffle. And so we're fighting through it on today's show. So you're, you're not able to get a loan to get a house in Hawaii because of your write offs. And so you did a stated income loan which is basically like, hey, here's the money that I'm making. Don't ask me any more questions. You're going to get a worse rate. Terms are not going to be quite as good, but at least you could get something. And this is how you kind of broke into the real estate market.

B (31:21)

So yeah, I got that, the stated income loan and I was 100% honest. I stated on it what my gross income was. And this is a great property that I saw could be made into a triplex. Did that. It was a three year arm at the time. I wasn't worried about it. I was worried about the market. I did see a lot of these mortgages going on. I was like, I watched the big shorts, like my favorite movie of all time. So I'm like, I saw this. How did I not, how did I not know I could have invested in this? So I was prepared that I'm gonna, you know, rent these two units out, live in One, I'm starting my investment portfolio, putting some money away and yeah, there's going to be opportunities in the next couple years. Well, what I didn't take into account is what we all know happened after I bought that in 06 and 09, everything crashed. My rate was adjusting. I couldn't afford the new rate and I couldn't refi. Because nobody even, even when you remember how that was or, I mean, people that were in it then you could have an 800 FICO and a great job. And the banks were still like, I don't know, I'm not sure we're lending right now. It was really hard to get a mortgage. And yeah, I ended up having to short sell that house, ruin my credit, wipe through all my savings and. And I just, yeah, started. Started all over square one in 2010. That was. So that was my lesson of if I really should have invested a lot more of that money over the last 10 years. But, you know, it's one of those things you say people don't talk about that. I'm happy to talk about it. I mean, I don't. People can say. That's the thing with online people. Oh, what an idiot. This and that. It's like, hey, you know what? Lots of people did that. And I didn't, I wasn't being stupid. I wasn't. I just wasn't educated, wasn't prepared, and I thought I was. By that time, I was doing a lot of things right. I had saved money, I had pulled back my spending. But you, you got to keep more powder dry than you think sometimes.

A (33:34)

Oh, God, yeah. Oh, yeah. I mean, that's, that's in my case, I've talked about a little bit. I haven't gone into it a ton. I was preaching this forever and ended up buying a bunch of houses. And you know, I talked to you a little bit about how the city got involved and said, oh, we don't want short term rentals in these neighborhoods. And I was like, well, the law says I can have it. And they're like, oh, that's what you think when you. I applied for the short term rental and they walked through the house and they go, hey, there was a kitchen remodel done here a couple years ago. No one got a permit. Hey, there was a bathroom put in in 1945. Never had a permit. Hey, that garage that you have used to be a carport. And every other house on the street also has a garage, but it never had a permit. And they. I had like six cities, six houses in different cities all do the same thing where there's just like war on short term rentals that I didn't know I was walking into where they shut you down and then they never issued permits. And I bleeding at one point for two and a half years, 150 grand a month in mortgages that I just could not get any income for and I couldn't sell the house because of all the permits that I had. And the banks don't work with you. And like you're so right. Like if I didn't have an insane amount of savings put away, I never would have survived. Like whatever you think you need to have 5x, that is what it took, right? And you don't hear about that on podcasts. You only hear like, yeah, buy and then refinance it and buy another one and refinance that and buy four more and refinance those 10 and then you have financial your freedom.

B (35:03)

Yeah. Well, the thing that, that really upset me about my situation is I was even then I've always been a very proactive person. So I kind of saw in the writing, I'm like, wow. So one of my tenants lost their job and then my dad was renting one of the units, he had health issues and lost, couldn't work anymore. So now I'm supporting my dad and my tenants aren't paying rent. I still could cover it with the money I had aside, but I'm like, well, this rate's going to adjust. It's going to go to here. I can't, this is going to get bad. So I contacted the mortgage company thinking I'm, I'm like, hey, can we extend the rate? What are the options? And this is when all the loan modifications started, right? So I started to try that process. They're like, oh, you need to talk with them about a modification. So I go through the whole modification process and they're like, well, you're not even behind on your mortgage. And I said, no, I know, but I, this is going to get ugly quick. So I'm trying to be proactive. Like, well, until you're 60 days behind on your mortgage, we can't do anything for you. So totally against everything I believe and you know, like, I pay my bills. That's what you do. So I stopped paying the mortgage for two months and I re file for the, the modification. Horrible process. They didn't have it together. Another two, three months goes by and they're sending me letters. No, don't pay your mortgage, don't pay your mortgage. Well, after about five months, they finally said, oh, yeah, you don't. Sorry, you don't qualify for a modification. And now you need to pay all that five months back, plus the penalties.

A (36:40)

Oh, man. Yeah. So many stories like this. I'm like, losing your mind.

B (36:45)

Yeah. I'm like, okay, yeah, sure, here's 40 grand, and I'm still gonna have. Yeah, so just a messy time. A lot of lessons learned, though.

A (36:54)

Yeah, that's. It's. It's so maddening dealing with banks. Like, I know that there's people that have called and said, like, hey, this is the situation I'm in. It's going to go to foreclosure. Because, like, people call me and schedule consultations and go over this stuff, and the bank goes, okay, here's a deal. You got to be behind. Like, you just said, if you're making payments, we can't help you.

B (37:13)

Yeah.

A (37:13)

So they stopped making the payments, and then now they're, like, in the foreclosure process and like, all right, well, let's do this. Let's work out a short sale because you're going to take the property back and you're going to have to sell it at a loss. What if you give me a couple months and I'll put it on the market? Let's work out a price that you would want to take it at. It's way less than if you have to go sell it on the courthouse steps. And the person that you talk to is like, no, you can go touch grass. We're not doing anything. Just, this is the deal. It goes to foreclosure. And the people representing the bank's money, whether it's the banks themselves or who they hired or the policies they put in place, are insanely unhelpful. It's maddening to me. It's got to be because there's some form of protection they're getting from the government where if they have losses, they can go to the Feds and they can say, hey, insure us for the money that we lost so we can keep loaning. And they've got agreements with politicians, which is ultimately taxpayer money. That's like paying for a super inefficient system that we've got. But you would think that people as smart as bankers would have better systems in place and they don't care at all.

B (38:12)

No, totally. And when I go back to that time when people talk about mistakes and regrets, knowing what I know now, the only thing I would have done different in that situation is I wouldn't have caved as quick that that's a lesson in ego. I definitely had an ego there because I'm like, I'm a pretty well known realtor in my town. I have been for years. People, you know, pretty successful. And now I'm going to have my, my name and my property posted as a foreclosure. And I, I was scared of that from a reputation standpoint. So that's why I decided to just do the short sale. In hindsight, I should have just camped there because a lot of people were in similar situations. And two, three years later, they finally got a modification and they got it at like 4% for 30 years. And I'm like, you know, I probably could have sat that out, but I was, I was scared about my reputation, I think, more than anything. And that.

A (39:09)

Yeah, but that makes sense because you're a real estate professional and you're thinking, like, I'm going to have the Scarlet Letter.

B (39:15)

Yeah, well, it's like we're talking about, right? How, how's your agent doing? I'm like, oh, here, I'm saying I'm, I'm going to be, be the guy that got foreclosed on. Yeah, look so good.

A (39:23)

Yep. Yeah, but it's, but that's a real estate man. It goes up and it goes down so fast. And we, we had so much quantitative easing and every single time the economy looked like it was going to slow down, we just said print more money, shoot it up with drugs and then we had another run and everyone just got used to the fact that that was normal. People spent money. It was normal to be a 22 year old with a brand new car and on a podcast talking about financial freedom when you had no idea how any of this stuff worked. You never even filed your own taxes. You're still using H and R block, talking about these real estate strategies and no one even questioned it.

B (39:56)

Right.

A (39:56)

And you know, I'll tell you one of the frustrations I'm having now as the economy has slowed down. I don't think we're in a terrible economy. We're just not in a really great one. It's not, it could be way worse. It's just kind of normal, hard. Like it's supposed to be trying to hire anyone that understands you got to show up at work and work your butt off to get above mediocre. Like, working your butt off is not, it's not like you're a victim. You're not even good at what you do yet. That's just normal. You have to work your butt off until you get good. And then you can either work your butt off and get better or work your butt off a little bit less because you're a little bit better. But no one knows anything. They don't have skills. They're constantly talking about, like, well, I know so and so who makes this much money, so I should. Or, well, I have a college degree, so I should make this much money. Even though it has nothing to do with the actual job that they are working in. It's really hard to hire anyone that understands this. And there's all this attention that kind of our current culture will put on. Your boss should pay you. That's how people look at it. Instead of the client needs to get what the client is here for. You are here to serve them. Your boss is not here to serve you. You're both here to be a team and serve the client. And if you don't have the skills to do that, you're not going to make that much money. And my personal thought is we just became spoiled from 10 years of an amazing economy that now I say this and I sound like the curmudgeony old man, like the grandpa in the Simpsons who's yelling at people all the time.

B (41:21)

Well, I'm a little older than you and can get a little grumpier than you on that one if you want. So.

A (41:25)

Well, if you don't mind taking a break from your story, please share your perspective as someone who's seen more than just the last 10 years on like, what is appropriate level of work and what is until.

B (41:36)

So first to the. I have two quick. So first on the quantitative easing thing, you're totally right on that. But I. With the whole mortgage thing that led up to the crash, I've never heard people talk about it that way, but I feel like that's what it was because being in the market then. So I started in real estate in 2000. The market was kind of picking up. It had been kind of slow in the mid-90s, late-90s, and it was picking up. And right about 04, you could tell that the market that was kind of it. We hit the affordability level. Prices had gone up. That. That should have been about it. But that's when they're like, oh no, we'll make a way for people to still afford it and prices will still go up. And that's what happened from zero before the 0607, 100% it was more 0406 and then 0708 is when those rates Started adjusting, and everything crashed. So, like you said, people, we. We have been in this culture for a long time of, like, there are. There can't be hard times anymore, you know?

A (42:31)

Yes.

B (42:32)

So that's that. And then on, like, I think about the last few years with all the crazy inflation. The funniest thing about it to me is everybody and inflation was nuts. No one's going to say it wasn't, but people like, oh, my gosh, eggs are this much. Oh, my gosh, bacon. I heard everyone going on and on about how expensive it's gotten. Nobody stopped buying it. If they did, the prices would have stopped going up. It's like, that's how. That's how it works. So when. Yeah, when times are tough, when things get more expensive, you got to pull back. You got to spend less. You don't buy that as much. And that in this last huge inflation cycle. I'm no economist professional, but I just saw it so much that it's like, why, if you stop buying stuff, the prices will stop going up. That's just how it works. Onto the job thing that we could do a whole podcast just on that. Couple of quick analogies that I was just thinking of the other day. So I am 49 years old now. Today is my birthday, actually. And 25 years ago, you were a cop before. I'm curious how it was when you became a cop, but. So I have family members that were going to be firefighters. I was going to be a cop. That was my plan when I got back to Hawaii.

A (43:51)

Amen, brother. You needed to let him have it.

B (43:54)

So 1999, I go and I apply and I take the test for Honolulu Police Department. I passed. Something like 3,000 people tested for 200 positions. They're like, oh, we'll call you. You want to know when they called me two years, and I already had this other job making better money. And I'm like, you know, I don't think I need to go deal with, you know, drugs and gang people. And I'm good. My cousin, firefighter. Same thing. Early 2000, they opened up 300 positions. Like, 5,000 people tested. It was almost three years before he got called. You can go on and on, you know, back, you know, plumbers, electricians, all these things if you want to be a cop or a firefighter. Now, most places in this country, like, come on down.

A (44:50)

They're short. They're begging you.

B (44:52)

Yeah, if you want to be a plumber, if you want to be an electrician, you want to be a roofer, you want to be an auto mechanic. I have a family member who, he's about 27 or 8, I think now. And you know, he got out of school and floating around odd jobs trying to figure out what he's gonna do his life. Well, he finally decided to go to aircraft mechanic school. I think it was like two years to get his certifications. He started an airline at $80,000 a year and one year in if he's willing to move, they will more than double his salary if he moves to another location. So two years of education, one year on the job and they're ready to pay him close to $200,000 a year at 28 years old. But like you said, who's doing that? That's not what people want to do. And I, I, I don't know what to tell you.

A (45:48)

I mean, I get why someone might want, not want to do that. At 55. They don't have the same level of energy, their body can't keep up. That, that natural ambition isn't there anymore. We're Talking about like 2225 year olds that should be working two jobs, maybe three jobs that are like, make it worth my while to try hard at something.

B (46:06)

So right there, you're 25 years old right now, Go be a plumber, go be a mechanic. Go, you know, go be a cop, go be a firefighter. Those are all six figure potential jobs in a pretty short period of time now, you know, live on 60 grand, invest 20 or 30 a year and guess what? When you're 50 years old, you won't have to be doing it anymore. But that's the, that's the, that's the age old thing, right? We've, we've, When I was a kid, everybody told me, oh no, it's going to go so fast. You got to be smart. You don't realize. And that's the thing. I don't know how we ever like, I don't know how you ever get that through to people. Because when I was 25, you couldn't tell me anything. You know, when I was 25, turning, you know, 50 years old is like a billion years away. And then all of a sudden. Yep, it's just like they told you. It's right here. Unless you get a terrible disease or have a horrible accident, you're going to be there in 20, 30, 40 years. And the little things you could do now, the, you know, buy, buy one house a year for 10 years. I mean, or when you go to buy that first house, that's the other Thing while we're on the soapbox, we could talk about expectations of housing if you want. I have a lot on that.

A (47:20)

Yeah, well like if you're thinking about it, let's hear about it.

B (47:23)

So I see it in rentals all the time. Sure, you see it in sales too. The, the standard of what people think their first house is supposed to be like now is just so huge. I remind people all the time, if you go back to and it's like what you're always preaching, like let's say you're a young couple or you're someone that's got their first job and you're, you saved up and you're ready to buy your first house. Well, if you're a couple with no kids and maybe you're approved for 500,000 and you want to get a three bedroom, two bath house, I'm sure you'd love to have all that space, but could you get a duplex that's two bedrooms and one bath on each side and live in one and rent the other for a couple of years and cut your living expense in half and they're like, oh, it's too small. Well, you go to any town USA in the older part of downtown where we've got these houses we call functionally obsolete, right? The old two bedroom, three bedroom, one bath, 800 square foot, one car garage with a three by three closet people, that's where families of four lived 100%. And now single people are like, that's too small, I can't live there. I'm like, well.

A (48:43)

I know. And you know another thing, Jeremy? I used to rent rooms from other cops when I owned and I was like house hacking the opposite way. They were house hacking to me. So I would rent a room and I would put my money towards investment properties. I was never home. I was out working a lot of hours. Like as a young man, you're supposed to be out there learning how to do stuff, not having a huge house. Doesn't matter if you're not in it all the time. But I can't remember the last time that I put out a job ad and it wasn't over 90% of people saying I'm looking for something remote. Everybody wants to be at their house, they all want. And so you now you need a bigger, better, nicer house to be comfortable all the time.

B (49:22)

Yeah.

A (49:22)

And I don't mean to sit up here and like I said, be the curmudgeony old man, but if this is irritating you to hear it, it might be what's getting in the way. You typically don't find successful people that are addicted to comfort. I don't know if I've come across one in my entire career. Successful people are addicted to challenge. They're out there trying to figure out how to be the top real estate agent in Hawaii, how to buy a house and fail and get back in there and do it again. They're not sitting at home looking for the job that's the most money for the least work.

B (49:49)

Right.

A (49:49)

They're saying, what's the thing that's going to teach me the most to make me more valuable? Like you were mentioning, if you can work on cars, if you can be a plumber, if you can be an electrician, if you can do, if you could be a copper or a firefighter when nobody else wants to do it, is it going to be harder? Yeah. That means you're going to get training opportunities other people didn't get. Your character is going to be developed, your skills are going to be developed, your skin gets thicker. Right. I used to work 18, 20 hour days, more than 10 hour days. Most of the time that's what I was doing. And when people would say, how do you do it? I'm like, I don't know, man. The car does most of the work. I'm just sitting in a car driving from call to call and typing on a computer. Right. Like if you look at it like it's not manual labor, it's not that hard, you can get through it. If you look at it like an 8 hour workday is insane and nobody should have to do that and the government should provide all the other stuff for you. Your attitude's going to turn sour and your mind's going to work against you learning things because you're going to be constantly looking for a way out of the discomfort instead of a way to get thicker skin or stronger muscles so it doesn't feel as bad.

B (50:50)

Yeah. And the other thing that. And again, it's back to the crotchety old men now. But it's like it's not forever. Like you don't have to, you know, gotta work in the salt mine until you're 50. You know, if you like work hard like you said, when you're young, you got the energy, you got the health so that you don't have to when you're older. And you combine that with the things that you're teaching every day about how to buy a house, how to, you know, save money, look at the advantages you can get on your taxes, all These things, you do that for 10 years and then you don't have to do that anymore. And, you know, that's what I eventually did. And I'm, you know, I'm in a good place now. I'm very fortunate. I figured it out, you know, in my late 30s, around 40 years old. But if you can figure it out at 25 or 30, you're 10 years ahead of the game, which is what you did. Right. You were grinding and doing this in your 20s and not spending a dime. You got it a lot younger than most people.

A (51:46)

Yeah.

B (51:46)

Some people never get it though, so.

A (51:50)

So you're selling houses and at some point you transition to property management. How does that work?

B (51:56)

So I had decided, even before the mess of my house, I decided I didn't want to sell real estate anymore. And the reason was I had plans to. I've wanted to move to Colorado forever. I've just known it's where I wanted to live.

A (52:07)

You just couldn't handle Hawaii. It was terrible.

B (52:09)

Oh yeah. It's just so horrible. Yeah. You're the first one to ever bring that up, by the way. I can imagine. I know.

A (52:16)

It's like that terrible dad joke that people make and you don't want to make it and then you find yourself make it.

B (52:21)

You're like, what have I become? Hawaii is beautiful, but I, I've lived there a long time. I just. You get older and you realize what you really like in life. And I love to travel and I don't want to have to take a five hour flight to do it. I love road trips, I love snowboarding. I live for snowboarding. So like my whole work.

A (52:38)

Not a lot of that in Hawaii?

B (52:39)

No, not so much. So my whole work. Like my life now, from December through March, like I'm off grid. I do bare minimum work. I bust my butt the rest of the year so that the wintertime, I literally during the winter, every Monday I look at the weather forecast and I decide what days I'm available for appointments based on what days it's going to snow. That's amazing. That's how my life works. But to the transition. So I had great sales, business was doing well. I wanted to get something that I could take with me when I moved. You know how hard it is to build a database and get a sales, you know, good sales operations started in real estate.

A (53:21)

Yeah.

B (53:21)

Now, in hindsight, I. It wouldn't have been as hard as I thought to move somewhere else. It wouldn't have taken me as long. I realize that now. But at the time, I'm like, oh, I look how long it took me to get this popular and this. This well known. I don't want to do that again. And I also thought I wanted to get into, like, brokerage management. So I worked and worked and worked for that for years. They kept telling me, you don't have management experience. You don't have management experience. I'm like, well, when am I going to get some if you don't give me some? So finally, they gave me a shot at it, and I hated it. I hated it so bad. I wanted to help agents make deals happen, pull things together, get through challenges. That's. You and I have that in common. I like big picture problem solving. How do we. Let's figure this out. Let's make this work.

A (54:03)

Yeah.

B (54:04)

And I got in trouble for. I had one agent who I was working with. She was newer. She was going on a listing presentation up against a big hitting agent, and she's like, oh, my gosh, what do I do? So we put together, you know, how can. Here's what you do. Focus on this, focus on that, focus on the value of the team, focus on the value of the company. Then another one with a deal falling apart that we saved in escrow. Both of them came together. She got the listing, the guy got the escrow. We got two deals in the office that day. I'm feeling like a million bucks. I get screamed at by corporate because I was five minutes late getting a weekly projection report in. And I'm like, well, do you want me to make the deals that I can put on the report and have it five minutes late, or do you want the report on time that has two less deals on it?

A (54:51)

Yeah.

B (54:51)

And the answer was, we want the report on time. And I'm like, I don't think this is the job for me.

A (54:57)

Right, right. So you're not screwing around. You're trying to make the company money.

B (55:01)

Yeah, I'm trying to make the money, not just turn in a paper. So it was actually a really another hard moment in life for me because I thought I wanted this so bad, and I was clearly not going to make it in this job. I wasn't happy. So I went to my mentor, who was my broker when I was in sales. He had recently retired, and he said, you know, we should have lunch together. I have an idea. And I think he'd be great for it. Well, he was planning to start a property management company. He owned several rentals. He couldn't find anyone he trusted to rent them to manage them. And he had retired and wanted to start traveling a lot more and didn't want to manage them himself. So he talked to me about the industry, what he found, what we could do. He was willing to put up a little money for it. He was willing to do the business plan and all of that because I had zero business experience, but I had the sales experience, I had the customer service experience. He's like, why don't we partner together? I'll train you on the business side. We'll do this, and after a few years, you can buy me out and run the whole show. And that's what we did. We started down that road.

A (56:07)

He said that from the beginning. He said, this is the plan.

B (56:11)

Yeah. Wow.

A (56:13)

I've never even thought of saying, hey, I'm going to start it. I'm going to teach you how to do it. You're going to do it? You're going to buy me out?

B (56:18)

Yeah. Well, he was. I knew him. He was my broker. He was a good friend then. Still is. He's very. He's. He's retired. He's about 30 years older than me. He was a great mentor to me there. He was a great mentor to me on rental properties, too. You asked, you mentioned earlier, someone I didn't have. You know, there were no podcasts. Right. But no, he mentored me and he taught me, and he was just very upfront about, there's an opportunity here. I'm going to put up X dollars, I'm going to give it the opportunity to run with it, and it either has to make money or fall apart, and that's it. And so there I was at square one again, like making no money, taking a 2000amonth draw. When we started this company, living on 2,000amonth in Hawaii. And yeah, started running with that company. And I think we got to 100 doors under management in a year. And within three years we were at 400. And then I sold it in 2019 at just over 500 doors. That was. That was a journey. It was a good one.

A (57:26)

What was some of the things that you felt led to the business growing like it did? What did you do? Well, that led that to happen?

B (57:36)

What we did, the big things we did well is differentiate how we did business, why we were unique and the services that we offered. This was in like 2010, we're doing this. We were one of the very first property management companies, especially there, like the management softwares that are out now were just starting to get kind of mainstream back then. But most People were kind of dabbling with them. They weren't really using them. I use the analogy it's like a, it's like an iPhone. You know, you have an iPhone, but if all you do is text people and make a call and maybe take a picture now and then, you're not using the phone for what it's capable of. We took the software, we built systems to use every aspect of the software from, you know, marketing, leasing, accounting, bill paying, inspections, all that stuff. So that was one thing we did really well. The other thing was the reputation we had within the sales, you know, the realtor community, networking with all of them, giving them an option to refer their clients to for property management, and most importantly, being, you know, how protective realtors get about their clients, making it 100% clear to them, we do not do sales. We're not going to do sales. You refer us, your clients, they're tagged in our system as your clients. If they even speak a word about possibly buying or selling something else in the future, we're putting them right back to you. Hmm.

A (59:06)

So you built this referral system basically of the connections that you'd have a previous career.

B (59:12)

Yeah, yeah, it was a big, it was a big referral network from agents I would still go to. I would go to brokers, open houses, even when I was a property manager and got to a place where agents, you know, they weren't. Most of them didn't think that way. Right. Again, they just want to sell their listing. But we, if it was a property we thought would be a good rental, I would just say, hey, you know, would you be interested in what this would rent for? Like, oh, that'd be great. And much like mortgage companies, you know, you'll do flyers for agents to hand out and stuff. We would do that with the rental estimate letter and we'd provide that to them to hand out at open house. And then it got where all these sales agents are calling us, Hey, I got this new listing. I think it'd be a good rental. Can you let me know what you think? And that really helped the growth.

A (59:56)

It used to work this way a lot more.

B (59:58)

Before it wasn't before the Internet, but.

A (60:01)

Before everybody was dependent on the Internet. You would ask another human, do you know a person that can do this? Right? Do you know a guy? And so your reputation and your character were your strongest sales abilities. Because if you did wrong by people, the word got around. That's a snake. And if you did right by people, they're like, look, you gotta use Jeremy this is why the guy was up until 2 o' clock in the morning working on a thing for me. He didn't stop. It wasn't his fault. He's a good people. This is who you want taking care of your house or your property, your apartment. Now way more people are googling or searching or asking chatgpt. Find a property manager. And so now you're looking at a sales flyer I on a screen that is telling you why you should use them with colorful font like basically all these things that pull the levers and push the buttons in your brain. I'm drinking you. They're not character based and it is so much easier to be taken advantage of in this world. And I think a lot of people get taken advantage of and then tell themselves, well I just failed at doing this, I should quit. But where their failure was where they, they found the support pieces the wrong way. It wasn't word of mouth. And I do think it makes it a lot harder to make the process work in today's method where honestly being a successful business person is often being a good marketer. It makes me sick to my stomach to say that because you can lie in marketing as long as you follow laws, but it's better when you're like the best people I found were word of mouth referrals. The best contractors was someone's like, hey man, I'm gonna whisper this name. Don't say it to anybody else. This guy's great.

B (61:30)

Yeah.

A (61:31)

What's your thoughts on just. If you're gonna build a business, do you need to learn how to market online or is there still a way to kind of do it grassro style like you did?

B (61:38)

I, I think it's both. I think it's a combo. But I think the grassroots is still very important and I just, my personal opinion, I think it's going to get more important I'm seeing with people like even now with renting properties. Okay. We, our system is you literally can schedule, you can view a property online, schedule a showing, go view it with a self showing, do an online application, e sign a lease, pay your deposit and get keys out of a lockbox without ever having to talk to someone. Right. Like a property that way. Nowadays the more that happens, the more people want to talk with us, want to meet us, hey, can we just stop by and you know we'd like to see you. So I think there is that there. You're right with AI that's kind of blowing up right now. I know everyone's freaked out about it and some people think it's amazing. Some people think it's the end of the world. I know you and Brandon have a back and forth on that.

A (62:36)

We sure do.

B (62:40)

But the bottom line is we don't know where it's going to go. It's going to take time. And I think back to again, I first got my. I was taking my real estate licensing course in the year 2000. Okay. For those that were around, that's when the Internet was just kind of getting pretty mainstream. Most people were getting a computer. Most people had Internet connection at least at work, but it was just kind of infancy mainstream, you know. Well, it was all in the news back then. It was still largely newspapers and tv, but they were talking about how realtors are dead. In five years, it's over. In five years, everyone's going to buy a house online. You're not going to need an agent. You should. You guys should all get out of the business now. And here we are 25 years later, and here's David with the David Green team, very successful Keller Williams sales team. And they're everywhere. Right. So how is that going to happen with AI in the next stuff? I don't know, but I just don't think face to face. I don't think. I think relationships, real relationships are always going to be important. And for those that don't, I think it's opportunity for people that want to go that way. There's not a lot of people doing it. Yeah, you want to see someone trip out, send someone a handwritten letter to a mailbox, especially an older person. Like, it means the world to them, you know, like, what if we went back to that on Kingdom?

A (64:11)

You know, I get that same thing. When you call someone on the phone, some people freak out, right? They panic, they run screaming. They go hide in the corner of their room and they. They immediately say, you're triggering my insert new psychological disorder here that like everybody is sort of grabb that and made it their identity now. Right? Like, hi, my name is David and I have ADHD agoraphobia. Like a long list of stuff they're scared of. But some people are like, genuinely confused. Like, hello. Like, they're expecting a pocket dial or AI to talk to them. And I've literally had people say, is this really David or is this AI pretending to be David?

B (64:49)

Yeah, I. So I'm in that weird age bracket, right, where like, I was an adult, you know, so I turned 20 in 1996. Most people didn't have a cell phone yet. Hardly anybody Had Internet and then I started working. So I've gone through the whole, like, you know, I've done the collect calls telling my parents I'm going to be home late. You know, from the mall to now, you know, living on a smartphone just like everyone else. But yeah, the, the biggest adaptation for me was like a couple years ago when the, the whole trend started that, like, instead of calling, people would text you and be like, do you have a minute for a call? And I'm like, why didn't you just call? If I didn't, it's like half a minute.

A (65:29)

Yeah, that's what he. Well, there's like an apologetics, like, I'm so sorry I bugged you. Is this okay? Because most people only call if it's an emergency.

B (65:38)

Yeah, yeah.

A (65:40)

But, yeah, that's a good thing. Like, when you make that effort, it does stand out.

B (65:44)

Yeah.

A (65:45)

Like, that's the thing that I'll do. A lot of the time if I'm like, talking to somebody who has a cabin in the Smokies, when I'm there, I'll mess and be like, hey, I'm here myself. Does your cabin need anything? And they're like, is this a scam? Yeah, why would you. It's like that old try to be a neighbor to somebody is so foreign. It's crazy how in such a short period of time that just became so foreign that people don't trust it.

B (66:07)

Yeah, yeah, it is. It is weird. And yeah, who knows where it's going next? But I, you know, I'm one firmly that technology is a tool, not a replacement. And, you know, we'll have to see where. I mean, I use it all the time. I just, I just reach out to do a bunch of research for me on the lawsuit thing I did. I used it to put together a sample trust for my parents because they don't understand it. I'm like, this is just how easy it can be. You know, I use it for spreadsheets, I use it for presentations. It's pretty amazing.

A (66:39)

So what you're hitting on is where Brandon and I butt heads about this very thing. And it's all done in good nature. I like AI or any form of technology from the perspective that you are Iron man, you are Tony Stark. You are the brain. And technology is your suit of armor that allows you to do things that you couldn't do without it, but it's still your ideas. So Tony Stark can come up with a way to send a missile at somebody, but he can't actually do the Damage. He has to build the missile. He needs technology to do that. If he gets hit by a bad guy, he's dead. He's a soft human. But if he's got a suit of armor on that he created, he can survive. Yeah, Brandon's take, and maybe I'm speaking for Brandon right now, he might argue with this, but the thing I'm arguing against that often Brandon ends up on the other side of is the motive of, I don't want to have to go to war. I want to build a suit of armor. Like in one of the Iron man movies. It was two or three. He makes little clone robots and they go do it for him. And you don't know that it's not Iron Man. Right. I don't like that. I don't like. The people are like, oh, I can't wait for AI because I'll just tell it to make me a newsletter.

B (67:48)

So go ahead. I was just gonna say, so I. The two things that make me nuts about it is nobody. Nobody retains anything anymore, right? Because so I. I look things up all the time. But if I'm gonna look it up, I'm gonna learn it and be like, oh, okay, that's the part that nobody that I see with technology, that freaks me out. Nobody retains any information. He's like, oh, I just look it up. I could just look it up. And yeah, that one's. That one's weird for me. But total other thing, total sidebar. Other stuff that talked about Brandon. I was thinking the other day about, I don't know, it was three or four years ago on a podcast and, you know, following you guys for years and seeing, you know, everybody's grown, right? You're. You're gone different directions and careers have grown here and grown there. And I was doing a. I was doing a flip on this property that I bought that was kind of just a slow. It was the slow flip. It was like a. Just to stabilize it, clean it up a little bit. I knew it was horribly managed, way under market ramp. So I was just about finishing that deal. It was an episode where Brandon's talking about focusing on these thousand dollar an hour activities. And I'm listening to it. I'm like, oh, Mr. Big Shot Syndicator now is talking about thousand dollars an hour. Okay. He's getting maybe a little too big for what I'm level I'm at, you know? And then about a week later, when that deal closed, I looked at it and I'm like, wait a minute, I bought it for this I put this much into it. I don't think I've spent more than. Long story short, I netted about 60,000 on this flip. And I realized there's no way I spent 60 hours on that flip. That's a thousand dollars an hour.

A (69:36)

Yeah.

B (69:37)

Oops. All right, Brandon's onto something there. It doesn't. It doesn't. You know, you think, thousand dollars an hour. It must be like this big, huge thing. It's like, no, this is like a $250,000 flip. And then I did a thousand dollars an hour. So that was a. That's a little hats off to Brandon next time you talk to him.

A (69:54)

Yeah. And not everyone's wired for the same things. I think the problem is guys like Brandon. That is a gifted man. I will tell you, when I used to listen to him on the podcast with Josh Dworkin, before I hosted it with him, I thought Josh was the smart one. And Brandon was a goofball. He comes across as this lovable, goofy guy. Then I met him in person, and he came up with a plan of how I could scale long distance investing. And he writes it down on a napkin, and he's a mad scientist with how fast his brain works. And I just realized, oh, my God, I misjudged this guy. He is pretending to be goofy, to be likable. He's wicked smart. Like, just his brain can't stop. It is so. And people say this about me too. And I get around Brandon and I'm like, oh, this is how I make people feel. I get it now because I'm, like, looking in the mirror around him, but that does not mean everyone's like that. You don't need to be a Brandon Turner with crazy good marketing and really big vision and really big goals. Some people just want to have enough money to take care of their kids and not have to work in the coal mine, like we said. And it's okay to just keep stacking base hits up over a career, like you said, by 10 houses in 10 years. And. And they kind of be done with it. I think that there's a lot of, well, peace. Morbi's doing this and Brandon Turner's doing that. I got to do the same thing. And you're not built from the same cloth that those guys are. You would be miserable to live in. Like, I like to go work out. I don't want to look like the rock. Right. Like, I don't want to work out till I throw up. I don't want to have to pump my Body full of steroids until I'm going to die. To be able to have that physique like, you can be okay just working out without having to go super hard. And in our world that you and I live in, it can be very confusing hearing so many different perspectives of what to do and not really knowing.

B (71:38)

Where you fit in. Totally. And I got that. That was a big thing I was struggling with when I came to your retreat that time, and that was great to kind of get because I was like, what's next? Like, I. I wanted to get here in life, and I'm here. So, like, now what do I do? And, yeah, so that's huge. But, yeah, it's. I think that's a big thing. And I don't know where you took this in into all this, but goal setting has become such a huge thing for me, and learning to be specific. And so many people say they have goals, but they don't. Right. Like, oh, I want to get in shape this year. Okay, what's in shape this year? I want to, you know, I could say, hey, hey, David, help me out. I want to get in top shape by the end of the year. And you'd say, okay, we'll go running and do this and that. No, no, no, no. I want to be able to bench press £300. I don't care how far I can run. Okay, well, that's a totally different workout. That's a whole different thing. It's the same with finance. It's the same with fitness. It's the same with personal growth. It's, you know, what specifically do you want to get to and be specific so you can track it. And if you don't hit it, at least you know where you're trying to get and how you can adjust, you know?

A (72:47)

Yeah, that's a great point. Most people don't. Don't let me say it a different way. There is a difference between. I made a commitment to stop saying people don't. People don't. I was hearing someone else talk about this on YouTube and they're like, people are like this. Like, we gotta stop talking vaguely. Like, human nature has inherent struggles in it, and it's better to try to pinpoint what it is about human nature that causes this problem than just, like, people care about whatever. There is a way of looking at the world where you can want something or you could wish you have it. If you want to bench press £300, you will come up with a plan to slowly increase your bench and eat certain foods or Whatever the case would be, most people wish they could bench press 300 pounds. So if somebody, if the bench press fairy came and touched your head with her little wand and said, would you like to receive the blessing of bench? You're like, I will accept that.

B (73:34)

Right?

A (73:35)

Yes, I will allow you to give me six pack abs. I wish I could have them. But you don't want them. Because if you wanted them, you probably already have them. If we're being honest. Right. If you wanted to be really successful, you'd be getting up early, you'd be working the two different jobs, you'd be on the phone all the time, you'd be wheeling, dealing, you'd be going to David Green and saying, tell me exactly what to do, I will go do it. Right. The number of people that come to me and say, I want to be successful versus the people that do, okay, we'll go do these things even in my own company is wildly different. What most people actually want is to find a way to make a bunch of money without having to work hard. That's what I found. And so they, even when they start to have success, like the guys in the businesses that are doing really good, they wilt under. Like, I gotta do this forever. Like, I gotta work this hard all the time. I gotta have people yell at me this often. I don't want that. And then every time, Jeremy, somebody comes along and offers them a lie. Hey, come join my mortgage company and you can have your own branch. Hey, come join my real estate team and I'll give you your own team. Or I'll give you a downline of people underneath you. Hey, take what David taught you and come work over here. And every single time, they collapse when they leave because they were trying to get away from the work. Right. And that's not to criticize people that don't want to work hard. Just say, I don't want to be in great shape, I don't want it, it's too much. I want to be healthy. If I can be here, here, I'll be good with it. And that's the difference between wanting and wishing. And just don't trick yourself into saying you really want something that you don't want because then you end up looking for the easy road out. And that becomes like, you take cocaine because you want to feel better or you join a multi level marketing thing because it looks like an easy way to make money. And those are the people that end up losing money, unfortunately, from scams.

B (75:12)

Yep. And this is where like, I don't you know, it's like, okay, this is where everybody always tunes out. Because it's like you always say it's not sexy, it's not exciting, but the, the facts are, you know, you have to. First of all, you have to work to make money. That's like step one, you got to work. You got to make money for finance, right? You got to work, you got to make money. If you want to get ahead, you got to spend less money than you make, and you got to invest the difference, and then you got to have patience and be smart with it over time. And how wealthy you want to get depends on, well, how hard are you willing to work and how much are you willing to give up lifestyle for future benefit? Working out, you know, you. You want to get in shape to run a marathon, you've got to start doing more cardio, you want to get stronger, you got to lift more weights or you got to do more reps. There just is. There's no easy button anywhere. It doesn't exist. Yeah, it's.

A (76:04)

Yep.

B (76:05)

And the thing is, as you get, you know, again, I'm in that, like, midlife, whatever. It's like, it's time. And if the younger you can start, you're gonna get, you're gonna be 40, you're gonna be 50, you're going to be 60, you're going to do 70. Like we were saying, you just got to do it. And if you don't do it, the sooner you do it, the better. But it's also leverage play, right? Yep.

A (76:28)

That's a great point. And we don't mean to talk about this in every show, but it's just because if you're looking for the person who says, here's the new hot strategy that's working for everyone, you're not gonna. It doesn't work for everyone. Everyone gets there, and in six months, it's gone. Those people just got your money because you joined their program or you paid to learn their secret. And you realize the hard way, it didn't work, and that's 10,000 less dollars that you have to actually put into.

B (76:51)

A deal to make it work. And the other side of that coin, even if you are the one in a billion that you win the lottery or you get some big inheritance or, you know, if you don't learn these things, you're going to be one of those people that won the lottery and is broken tutors, you know, I mean, how many celebrities, sports people, music, you know, rock stars and actors that, you know, made millions and then are bankrupt in five years. The, the, the, the metrics, the fundamentals, you gotta have them. And I think that's more important to get younger than maybe even making so much money because this is actually a great point. I'm sure you guys see this at the one brokerage too, because I've seen it with, with real estate clients and I see it with rental applications all the time. You have this rental and this couple comes in and they're like, oh, we make this much money and you know, my, I'm a doctor, my wife's a Lawyer, we make 400 grand a year, we're good to go. You pull their credit and they have no money in the bank. They have 150,000 in credit card bills and they have, you know, two 1200 car payments. Well, the average person looks at them and thinks they're doing great. They're not, they have no net worth and they're in debt. Then you get this other single person that comes in and applies and they look very conservative and they're, you know, driving their 10 year old Toyota Corolla and you run their credit and see their bank statements and they got a 780 fico and 100 grand in the bank. They make 50 grand a year. Well, it's not all about the income, is it?

A (78:29)

That's exactly right, yeah. I mean, there's an analogy there. I used to work out like an animal and I was lifting really heavy and working out twice, twice a day and you got to eat a lot of food and then you get used to eating that food and then you can't work out that hard, you go the wrong direction. Right. You can get used to making a lot of money, but if you don't learn how to limit how much of it you're spending when you got to pay your taxes or when the economy turns around, it is really hard to scale back from driving a Mercedes to going back to a Corolla. If you just always drive the Corolla when the market shifts on you, it's not that hard to adjust best.

B (79:04)

Yeah, absolutely.

A (79:07)

Well, thanks, Jeremy. I appreciate your time today, especially with your throat fighting. You, the Internet.

B (79:11)

Yeah, you too. Maybe we can get together another time when we're not both coughing every five minutes.

A (79:17)

We are absolutely going to do that. Any last words of wisdom you'd like to leave the audience with as well as where they can get a hold of you?

B (79:23)

No, just, you know, keep, just do, do the things that. There's no easy tasks. Got to do the things and yeah, best way to reach me. If you want to check out my website, it is ipmgj.com there's a link to my Instagram profile there as well if you want to check out what we're doing property management wise. And yeah, great to talk with you.

A (79:46)

All right, man, thanks a lot. And if you like today's show, go ahead and send me a DM on Instagram that says Re Space Pro, where I'm going to be putting a webinar together where we talk about exactly what we talked about on today's show, how you can take your real estate business and build a slow, steady and predictable wealth building machine that will function like a financial fortress, not a get rich quick scheme so that you become the tortoise that outpaces everybody else that's trying to be the hare. Jeremy, thanks for being on today. I really appreciate your courage and your friendship. We'll do this again.

B (80:17)

Thank you.