← Wake Up to Wealth
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- [00:03]
Brandon Brittingham
This is Wake up to Wealth, a podcast dedicated to helping you change the way you think about wealth. And now, here's your host, Brandon Brittingham.
- [00:18]
Ford Bozzi
Yo, what's up, everybody? We are back with another edition to Wake up to Wealth. And really, really lucky today. Got my homeboy in studio. Right.
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Let's go.
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And flew all the way here to Maryland. We got an event tomorrow that he's here for. But my good friend, my homie, Ford Bozzi. Thanks, brother.
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Thanks for having me, my man.
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Appreciate you. Yeah, absolutely. So we've known each other for a while, and one of the spaces that you're in is the Airbnb space. Yep. Specifically, kind of more the luxury Airbnbs. Right. So, you know, we're gonna unpack a couple things, but one, I think from the outside looking in, people are like, oh, man, I want to do Airbnb so easy.
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Instagram University, baby.
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Yeah, let's just go do it, you know, let's just do it. Let's do it. This is going to be easy. Like, you know, talk about Airbnb, like, as a business and, like, you know, you don't need to go into everything but, like, high level, what should somebody know? Like, before you even go down this. Does it make sense for you or not? What should somebody know?
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Yeah. So high level is it's an asset play. At the end of the day, the cash on cash return is not what everybody tells you it will be unless you have a real good real estate background and plan. Right. Like, it's still about, did you get in? Did you get the velocity of your money fast? Were you able to bur the property, get your money out now no matter what? Did you have a good cost base? Have you owned the property forever? So you just have no debt on it? So those things work really well on the cash. On cash. Right. But if you're going in there, you got a new build, you got full leverage, you got all that. I mean, the play is, can I get this asset to pay for it itself and can I get a little bit more cash flow on top? But at the end of the day, it's still real estate at its core. And I think that's where most people mess up, is they don't understand that an asset is an asset. And that's the way that real estate works. Just almost in every asset class. Right.
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Yeah. Another thing that I've seen and ran into is I've had this happen plenty of times. Someone's like, well, you know, we're going to buy this and we'll just airbnb it. And I'm like, cool, who's going to do it? Well, we're going to do it. And I'm like, well, how many have you done before? Well, none. And I'm like, dude, like, do you understand, like, talk about, like, managing an Airbnb as a different animal, too. Like, people don't understand. Talk about that side.
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Yeah. Like, you got to be. You're fully in the hospitality space, right? So you have to have people skills, you have to have leadership skills. You have to understand how to manage your vendors, your cleaning team, your maintenance. You gotta have good relationships with people. Because when your guest is there and you're getting that wartime phone call, like, the toilet's not working, the shower's not draining, all these things, you've gotta have good enough relationships with your vendors to get people out there quickly. Right? So there is so much that goes into the guest experience. And one bad review, remember, like, crushes you. Yeah, it crushes you. Because if anybody looks through your views, they're not looking for the good stuff. They want that one bad one they're looking for. And so you've just gotta be really, really good at. You gotta understand the ways. And Airbnb holds review policy is so tight, so it's hard to over even if a guest lies on the review.
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Right.
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They don't review that stuff. They don't remove that stuff even if you challenge it and show proof, like, hey, that's not true. Here's what happened. And here's. I have proof. I have messages like, here's all this. They say, that's the guest experience and we're not messing with it. So it has to violate one of their policies. And if you have somebody experienced like I do, I know how to get a guest to violate the policy without them knowing they're violating the policy. Right. So you got to have the tricks of the trade for sure.
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Yeah. So now it can be. It can be. It can be a good asset play, Right?
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No doubt.
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Yeah. So. So you found some success in a couple of markets. What are some of the markets that you've invested in yourself personally?
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Love Phoenix. So we're Phoenix. You know, here's the thing is, like, you know, during COVID everybody thought it was a great idea to just get into Airbnb. I had some property. I'm going to go into the woods and buy a cabin and throw it on Airbnb in this place that nobody ever travels to, but for some reason, they're going to travel there. When I put it on Airbnb. Right.
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Which it did work in Covid.
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It did work during COVID And it worked because the planes were all shut down. Right. You couldn't go. But, like, for decades, everybody has told where they like to go on vacation. Oceans, mountains, camping. Like, yeah, those are the three things. So stop trying to be innovative. It's like just. Just follow the trends, like, understand what people are doing and why they're vacationing. And so we've stayed really true to that. So, like, our first one was near the ocean, near the Pacific Ocean. Huntington Beach, California. We operated for a year and a half. Selfishly, we needed that one. So we were using it every six weeks, and then we would rent it out. Otherwise made about 150k in gross revenue while we ran it, which turned into about 60k in net revenue. Net profit.
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Yep.
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And then a year and a half later, we sold it.
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Yep.
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Made it. Made almost $200,000 on the sale.
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Right.
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So when you buy close to the ocean, you know what you're buying. And you know there's only one way.
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It'S only gonna go up. Right.
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And when you're in a place like Phoenix or Scottsdale, same thing. The closer you are to the mountain, it's like being close to the ocean. So we're buying the old properties and the really nice neighborhoods. We're tearing them down, rebuilding them. And I think that is one thing that I've learned if I had to share anything with somebody is, you know, early on, because we had low interest rates. When I first started in this, we were buying turnkey, and turnkey doesn't work anymore because the market has shifted, because supply has risen and there's some saturation. We had to go back to playing these, like, assets again. And so that is why we don't buy turnkey anymore by the old house. Tear it down, build it, get your equity, all the equity. Get all of our money out, move it onto the. So now even if this thing breaks even, it's not ideal, but at least it's covering itself and our money's moving on.
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Right, right. And you've got an asset. Yeah. And you've got an asset with equity.
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Exactly. What's beautiful about the short term rental space is, you know, when you're in it, it's like your building a business to sell at the end of the day. So, like, you know, there are prop. There are huge property management companies out there that just want the gross revenue and they want your portfolio for that. And so that's A huge play for me is how much revenue can we get in the door, how much can we do that so that our assets are paying for themselves and then eventually we can make an exit. If we don't make an exit, that's fine. But if I'm building it that way, at least I'm building something way bigger than I would have had I not had that strategy and that plan on it. Yeah.
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And then at the same time, while you're, while you're building it, you're, you're, you're holding on to assets that are going to appreciate in value.
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Exactly, exactly. And then, and then on an exit, it's cool because you get to keep the portfolio and sell.
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Right.
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Just the short term rental side or you could sell both. We have bolt on businesses. So we started a pool servicing company in Scottsdale because we have so many properties there. I got to write that check anyways.
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Yep.
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So I found an operating partner. He's operating. I'm visionary. I get to play my favorite role because usually when I get into the operation, I screw shit up. So this way I just get to keep my hands out, get to keep my brain on my marketing brain, my vision, all that. Like, just, just really get to play my fun side.
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Yeah.
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We're going to bolt on a couple other businesses that'll bring in revenue. Top line, we're starting our own insurance company. So instead of our guests buying insurance via third parties, they're going to start, we're going to start self insuring. Yeah. Because we barely ever have any claims, so we might as well self insure it, right?
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Yep.
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Just extra cash flow right off the top.
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Yeah. So I'll switch gears for a second just because I know, I know your background. So you know, one of the, you know, entrepreneurship in general. Right. You know, one of the things is that you're nine to five. Your corporate person out there, a lot of times are they're scared to leave that they may have a want or a need or a calling to become an entrepreneur, but they're scared to do it. Yep. And you've actually done that.
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Yeah.
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So it'd be cool to talk about that a little bit of just kind of what made you, you know, make the decision and then you know, just kind of being on the other side of that. How you feel about it.
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Yeah, it was wild, man. I mean, 20 year career. I had a really cool banking company career too. And like last 11 years I was a bank consultant. And so my job, 70% of my time was on the golf course of the C suite of community banks. So like, you talk about the coolest job all over America. It was really, really fun. But in 2018, my wife was pregnant with our third kid. Our two boys at the time were in preschool. And the group I led, we performed. I mean, we crushed it. I'd put myself up against anybody in building relationships because no matter what, you're in the people industry, right? And you've got to go and be able to win people. And that's something I was really successful with. And that's why we won every contract that we went after. So I had a lot of leeway with my boss. This was pre Covid 2018, pre, like everybody working remote. I went up to him and I said, listen, my two boys are in preschool. We've got a ton of family all around us. But I really want me or my wife to be one of the ones picking them up from school. We don't want grandmas, we don't want uncles. We want them to see our face. And so I'm gonna start leaving the office every day at 3, I'm going to pick them up from school and I'll finish the day from home. No problem, right? Like the answer was no problem. Like without even flinching. But the simple fact that I had to ask permission, I had to ask somebody's permission to go do something for my kids, it felt so unorganic, right? And I just like, that didn't sit right with me. And I'm like, it's only going to get more because then there's going to be sports and there's going to be life and there's going to be all these things that's. I got to find a way out. I got to build my plan. And most people are worried about the plan. Like, like, well, like I'm sure they're shutting down when they hear this part of the conversation because they're saying, I can't leave corpor corporate tomorrow. And that's fine. But if you're in your 30s, 40s, or even early 50s, you don't have to wait till you're 62. We can get you on a five year plan and get you out faster. The biggest aha moment or the biggest thing that I learned was, you know, for the first, about year, year and a half, you know, as an entrepreneur, there's, there's, there's not a lot of routine. Sometimes, sometimes you're just like in, you know, it's, it, it doesn't stop. I mean, it's, it's a part of you. Like when you're in a corporate, it's work, life, balance.
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Right?
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Leave the office, it's here, you're done. Home, it's home. It's work, like balance, you're done.
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Y.
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Now it's work, life, integration. My kids have to understand what we do, how we do, what we're running and what we're building for them. And so we never turn it off. And so because of this, like, you know, this, like, up and down day, like, sometimes I'm on, sometimes I'm off and all that stuff, it felt sometimes unproductive. If you find yourself at 2:00, your kids want to go out to lunch. Cool, let's go out to lunch. That's why I left corporate, so I could do stuff like that. Right. But then you're out for lunch and you're like, man, this is a little unproductive. So it took a little while to adjust. But I'm so grateful for that freedom now because now and again, like, My kids are 9 and 8, my daughter's 5, but my 9 and 8 year old, they have an LLC of their own now because they see us doing what they're doing. They want a copycat, they're not doing anything with it. But. But like, now they understand.
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I mean, think about how far ahead they are. I've just known that.
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No doubt.
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Yeah, yeah.
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When we, when we launch a new property, they come out with me. Like they bought, like they build the Amazon cart, I purchased still, but they build the Amazon cart. They know what we have to put in there, like all the books that we're going to put, the board games, all that stuff. And when we get to the house to launch it, they're the ones putting the board games in their places. They're the one testing the outlets to make sure that the phones charge. Like just all those little things that they can get involved with so they understand what we're doing, you know?
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Yeah. That's awesome, man. So back to the Airbnb question. So someone so Airbnb sexy, right? You know, I want to do it. Everybody wants to do it. Like, everybody wants to get excited about it. So if I'm out there and I'm listening to this and I don't know what to do, and I, and I want to get in the air being I'm hell bent on it, I want to do it. What, how should I start? What should I do?
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Learn the food, man. Come, come learn with me. I mean, you know, I wanted to learn real estate Easiest thing for me to do was to pay somebody to learn real estate. Right. Like, because you can really cost yourself a lot of money, you do this thing wrong.
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No doubt.
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So you got to choose your markets, you got to choose your assets, you got to choose who you got to find. There's so many things that you got to understand, right? Like, who is going to be your clientele? Like, I think I want one there because I love to visit there. That's not a good reason to buy an Airbnb anywhere.
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Right.
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Like, you have to understand your numbers, and you have to understand what the Four Seasons are. You have to understand there's so much. So what I would say is hire a coach, hire a manager, mentor, guy like me doesn't have to be me. I'd love it for me to be me. Of course. And if I'm the right person, I would tell you. But for sure, just brings. Just get around somebody that's already done it, that's already, you know, that's got the battle scars that's going to share with you. Not just, hey, this is going to work. Like, no, like, go find out what. This is going to work.
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This is not going to work.
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Go find out what doesn't work. Go find out all the mistakes somebody made.
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I'll tell you from personal experience, and for anybody that's. That's listening out there, I think you made a good point about the. Why I like the vacation there. Right. And in my personal experience, I turned my vacation home into an Airbnb. And after I did that, I didn't want to stay there anymore. And, you know, nothing against anybody, it just kind of felt weird to me.
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Yep.
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Because it was like it was my house, and now it kind of isn't. Do you know what I mean? And I would visit the property, but I didn't want to stay there anymore. Do you know what I mean? And I'm just. I'm just sharing that as a personal experience, is that, you know, I had bought a vacation house and I put it on Airbnb, and it did very well, and it still does very well to this day. And. But, you know, it was like, after I had a bunch of stays, I was kind of like, you know, it just doesn't feel like home anymore. I don't want to stay here anymore. Yeah, I would use it to hang out and go. Go to the property. Now, granted, it is very close to where I live. It's just on the water. So, you know, I could go home. I could be home within 20 minutes. And being. And be in my normal bed. But once I. Once I put it on Airbnb, after a while, I didn't want to stay there anymore.
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Yeah. It's so funny because it's true. Like, I totally get that, because the housing that we had in California, we were using it every six weeks. We had to be there, so I didn't really have any choice. But it felt weird to me, too. Even though it's like, okay, if it wasn't my house, I'd go rent another Airbnb where guests were saying. So it was like, you know, whatever, but, but, but. And it's hard to enjoy sometimes because you go in there and you're so critical. Like, this is.
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That was.
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Want to do.
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That was the other thing for me of, like, why I stopped wanting to stay there, because then I didn't look at it through the eyes of. Of it being my house. I looked at it through the eyes of being a guest, and I was like, well, we got to fix that light switch. We got to paint this. We got to do this. I think we should get a different piece of furniture there. And then it just became, like, work again.
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Yeah. Because if it's not yours, if you're staying in another Airbnb, you can just complain to the owner.
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Yeah.
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But when it's yours, it's like, shit, I'm complaining myself.
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Yeah. And so it's like, I'm coming here to relax and chill, and then I'm getting back into. Mentally, I'm getting back into work again.
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I will tell you one of the cool things, though, that we just experienced, because we're talking about selling our home, our primary home that we live in back in Detroit. And. And we've been having. You know, I'm not emotionally attached to real estate. I moved 12 times growing up. My wife was born and raised in the same exact house that we got married. So we have very different feelings on how we like emotional attachment, how you look at it.
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Yeah.
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And so I finally got her. You know, we were. I was close to getting her there. I really want to sell because of. Because to play on the appreciation. And then we went to Phoenix about three weeks ago to stay in one of our Scottsdale properties. And it was really cool because she was able to see another house that we have, and she fell in love with that house, too. And she's like, you know, I think I can get comfortable. As long as we know we can go recreate something. I can get comfortable now. So what's really neat about airbnb is like, let's say you're, you know, rather than just using them as vacations. Like, if you're somebody that's out there just looking to buy a home like, that you want to live in, like, go find a house on Airbnb that looks like the house you want to build. Go see if you, like, go see, like, go date that house before you marry one. Right. It was actually really, really cool experience. I mean, just totally off topic, obviously, from the business side of it, but how you could use an Airbnb is so different and so cool.
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Yeah.
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It's like a showroom.
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Yeah. What are. In your opinion? You know, this is something people always ask, and it's a topic of conversation. What are some hot Airbnb markets that are out there in the country?
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Yeah. So, I mean, it happens. It ebbs and flows. Right. Right now, what I love. So I love Scottsdale. Scottsdale will never go away because it's got so many permanent things that happen. So the permanent things that happen there, what do you got?
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You got good weather.
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Well, you got great weather for most of the year. 12 months out of the year, the only complaint you have is twice two months out of the year is too hot. Right. But you got 16 Major League Baseball teams that have the spring training there, the Cactus league. So from January 1st through April 1st, we pay about six months of our mortgage on all of our properties in that time. You've got the Waste Management Golf tournament. So that's like 11, $12,000 weekend, like, three nights. Got the Barrett Jackson Auto auction twice a year, where all the rich people, like, descend on Scottsdale to go, you know, so. So they've got all these permanent things, plus it's a bachelorette party capital of America. So that's a really, really good market.
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Multiple sports teams, too.
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Multiple sports teams. That. That and. And bowl games and constantly. The super bowl is, like, cycling through there. Yeah. Seven, eight years. So you've just got so much going on.
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Well, and just normal travel, people going there on vacation.
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Yeah. And by the way, not to mention, like, what's happening, like.
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And it's a cool. It's a cool place, and it's a great place to hang out.
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Yoga, mountain climbing. And people want the Scottsdale plus Sedona, then they want to get into the Grand Canyon. So, like, there's just so much going on there. So that's a really, really good one. Lake Tahoe is a great one because you got 12 months of a market there. You got the summertime hiking, you got Those skiing, the golfing, all that. So Lake Tahoe is a great market to be in. Certainly any of the beach markets up and down California. San Diego is just. Just a fantastic market. But. And then even, you know, and then. And then the panhandle of Florida from, like, 31A in Destin all the way down into Tampa, that market has really, really exploded. I would say those are probably like, the off. Off topic, you know, not talking about roi. Just a great place for, you know, consistent and very predictable occupancy. Like, those are the best markets.
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Got it. We end the show every time the same way we call the show Wake up to Wealth. And, you know, obviously, the focus of the show is to teach people different ways to invest your money. Obviously, Airbnb is one of them. That's why I wanted to have you come on here. Obviously, we both believe in real estate, and this is a factor of real estate, but I ask everybody the same question. We end the show the same way every day or every time. I'm sorry, what is waking up to wealth? What does that mean to you?
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Controlling my time, being able to say yes to my kids every single time and prioritize that in my life and whatever I want, prioritizing my health, doing what I want, when I want, with who I want, from where I want. That's wealth to me. Right? Having my fitness dialed in is extremely important. I have that more so now than I ever have in my life. Because when you set that goal, like, you can give me money, you can give me real estate, you can give me love, you can give me anything, but you can't give me my health, I have to fight for that. I had to earn that. So to me, wealth is. A lot of people want to use money. And I always say the same thing about money. Like, if somebody gets a million dollars and they say, I want a million dollars, that's my goal, and they get to a million dollars, they don't stop there, right? Because then they want 5, then they want 10, then it's just a scoreboard. Wealth is truly being able to control anything you want to do from whenever you want, from wherever you want. And that's. That's. That's. That's it. I mean, for me, it's holistic.
- [19:26]
That's a great answer. Well, hey, man, I am grateful for our friendship. I'm grateful that you took the time to come on here today and you traveled all the way to freaking Maryland to be with us tomorrow. So I appreciate you coming on the show. You gave great insight like I know you would, and I thank you so much.
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Amen. Thank you so much. Hope this was helpful.
- [19:48]
Brandon Brittingham
Thanks so much for tuning into this episode of Wake up to Wealth. We sure do appreciate it. If you haven't done so already, make sure you're subscribed to the show wherever you consume podcasts. This way we'll get updates as new episodes become available. And if you feel so inclined, please leave us a review on Apple Podcast and tell your friends about the show. It is how new people find us. Until next time.