Podcast Summary
Buying an Apartment Complex with No Money Down and Receiving a Check as Buyer: Brian Murray's deal of buying a 115-unit apartment complex with no money down and even receiving a check as the buyer highlights the importance of negotiation skills and creativity in real estate investing. BiggerPockets' new tool, the Path to Purchase Estimator, helps investors estimate their timeline to buying their first rental property based on savings.
Real estate investor Brian Murray shared his experience of buying a 115-unit apartment complex with no money out of pocket and even received a check as the buyer. This deal, which is almost unheard of, is a testament to Murray's negotiation skills and creativity. In addition, BiggerPockets introduced a new tool called the Path to Purchase Estimator, which helps investors estimate how long it will take them to purchase their first rental property based on their current savings and monthly savings rate. The quick tip is a simple yet effective way for investors to plan their financial journey towards real estate investing. Overall, the podcast episode offers valuable insights and practical tips for those looking to get started or expand their real estate investment portfolio.
Investing in Real Estate with Little to No Money Down: Explore turnkey rentals, find motivated sellers, and leverage insurance for multiple properties to invest in real estate with minimal capital.
There are various creative ways to invest in real estate with little to no money down. Rent to Retirement offers turnkey rental properties at steep discounts with low down payment or even no money down options. PropStream helps find motivated sellers by providing access to over 155 million properties with various search filters. NREIG offers insurance specifically for real estate investors, allowing them to insure multiple properties under one policy. Brian Murray, a successful real estate investor and CEO, shares his experience of acquiring his first property without outside capital and turning it into a commercial real estate investment company. These resources and success stories demonstrate the possibilities for those looking to invest in real estate with limited funds.
Adding value to real estate investments: Increase rental income or reduce expenses to boost net operating income. Strategies include BRRRR method, cosmetic improvements, changing property use, and being creative and persistent in finding opportunities.
Adding value to real estate investments is crucial, especially in today's market where valuations are higher. Value-add can be achieved by increasing rental income or reducing expenses, which in turn boosts net operating income. This can be done through various strategies like the BRRRR method, where properties are bought, rehabbed, rented, refinanced, and the process is repeated. Brian, a buy-and-hold investor, emphasizes the importance of finding properties with potential for improvement and executing a plan before purchase. Some ways to add value include cosmetic improvements, changing the property's use, or even something as simple as removing trash from the premises. Brian shares an example of buying a distressed hotel and converting it into studio apartments, which resulted in a fully leased and successful project. Overall, the key is to be creative and persistent in finding opportunities to add value to real estate investments.
Transforming a hotel into affordable apartments: Careful planning, research, and a focus on providing value to renters are key to successfully converting a hotel into affordable apartments, despite additional costs and the need for tenant screening.
Converting an old hotel into affordable apartments can be a profitable investment, but it comes with its challenges. The speaker shared their experience of transforming a 2-story hotel into apartments in Watertown, New York, and how they attracted a diverse range of tenants, including blue-collar workers, professionals, and travelers. They noted that the change in use led to additional costs, such as installing sprinklers and making units handicap accessible. However, keeping rents low was a strategic move that helped attract a large pool of applicants and allowed for careful tenant screening. The speaker also emphasized the importance of considering the needs of the traveling workforce, as they often require temporary housing solutions for long-term projects. Overall, the success of the investment depended on careful planning, research, and a focus on providing value to renters.
Finding opportunities in affordable areas: Successfully investing in real estate involves balancing affordability, growth, and personal satisfaction by finding opportunities in lower-cost areas, even if living conditions aren't ideal for long-term residents. Control over decisions and reinvesting profits can lead to growth without external investors.
Successful real estate investing often involves finding opportunities in affordable areas, even if the living conditions may not be ideal for long-term residents. For instance, in Cheyenne, Wyoming, the cost of living is lower, and the high demand for traveling nurses results in well-paying jobs. Regarding a specific project, the speakers discussed a hotel turned apartment building they purchased and renovated for around $1.5 million, which appraised at $2 million. They opted not to bring in external investors, preferring to reinvest profits back into their business and properties. The benefits of this approach include maintaining control over decisions and not having to promise specific returns to investors. However, this strategy also limits the potential for exponential growth, and finding new opportunities becomes more challenging as the business grows larger. Ultimately, the key to successful real estate investing is finding the right balance between affordability, growth, and personal satisfaction.
Effective Communication and Agreement in Commercial Real Estate Partnerships: Clear communication and agreement are crucial in commercial real estate partnerships. Understand each other's goals, expectations, and potential investor needs. Commercial real estate financing can be flexible, allowing for creative solutions. Build relationships with brokers and directly approach property owners. Use LoopNet for learning and finding deals.
When it comes to partnerships in commercial real estate, it's essential to have clear communication and agreement between all parties involved. This includes understanding each other's goals and expectations, as well as potential investor needs. Additionally, commercial real estate financing can be more flexible than traditional residential loans, allowing for the combination of loans or creative financing solutions. To get started in commercial real estate, a great place to begin is by building relationships with brokers and directly approaching property owners with a positive and respectful approach. LoopNet is also a valuable resource for learning about financials and finding potential deals. Remember, approaching property owners with a respectful and interested tone can lead to successful negotiations.
Approach potential sellers with respect and honesty: Expressing genuine interest and admiration for a property can lead to better communication and potentially a sale. Persistence and regular follow-ups can also pay off.
When trying to purchase a property, it's important to approach potential sellers with respect and honesty. Insulting them or their property is not an effective way to persuade them to sell. Instead, expressing genuine interest and admiration for their property can lead to better communication and potentially a sale. Additionally, persistence and regular follow-ups can pay off, as some sellers may eventually be open to selling even if they initially decline. An ancient Chinese proverb, "You can catch more flies with honey than with vinegar," emphasizes the importance of using a kind and pleasant approach. The speaker shared a personal success story of a 115-unit HUD project where he persistently reached out to the owner for three years before they decided to sell. Despite not knowing the property was section 8, he was able to buy it and convert it into market rate housing. This experience highlights the importance of staying persistent and maintaining a positive attitude when trying to purchase a property.
Discovering hidden expenses in regulated properties: Due diligence and creativity are crucial when investing in regulated properties to uncover potential hidden expenses and negotiate favorable deals.
When investing in properties with government regulations, such as HUD vouchers, there may be hidden expenses and inefficiencies that can significantly impact the financials. In the case discussed, the investor discovered inflated expenses due to staff theft and inefficiencies. By being a local investor and conducting thorough research, the investor was able to uncover these issues and negotiate a favorable deal. The investor also creatively financed the deal by asking for a seller note and a credit for the replacement reserve account at closing. This experience highlights the importance of due diligence and creativity when investing in regulated properties.
Flexibility on top line number for cash flow gains: Focusing on overall deal cash flow, rather than just the top line number, can lead to reduced upfront cash and increased returns for investors. Be sure to only apply this strategy to deals with confidence in creating value.
Focusing too much on the top line number in real estate deals can lead sellers to overlook important concessions, such as closing costs. By being flexible on the top line number and focusing on the overall cash flow of the deal, investors can potentially reduce the amount of cash they need to put in upfront and increase their returns. However, it's important to only use this strategy on deals where the investor is confident they can create value and boost equity. Another tip is to structure closings so that they occur near the beginning of the month and include prorated rent in the operating account to minimize the amount of cash required at closing. But be aware that unexpected issues, like a renewed HUD contract, can still arise and potentially derail the deal.
Managing a HUD property: A complex undertaking: When managing a HUD property proves too challenging, consider hiring a professional management company for expertise and successful outcomes.
Managing a HUD property is a complex undertaking with unique challenges and requirements that may be beyond the capabilities of an inexperienced property owner. After discovering that a HUD contract cannot be overturned once signed, the speaker was faced with the decision to either manage the property themselves or outsource it to a professional management company. They ultimately chose the latter and were fortunate to find a reputable company with experience in managing HUD properties. This decision proved to be beneficial, as the new management company was able to properly manage the property, hit budget targets, and even secure funding for renovations. The speaker learned that while managing one's own properties is generally preferable, some situations may require the expertise of a professional management company.
Buying Apartment Complexes: Achievable with Determination: Determination, no money down deal, 1031 exchange, $1,000,000 profit, myths about complexity, no intimidation, keep proceeds for reinvestment
With determination and the right mindset, buying apartment complexes is not an unattainable goal. The speaker shared his experience of buying a 115-unit complex with no money down and making over $1,000,000 in profit through a 1031 exchange and operating the properties. He emphasized that there are many myths about the complexity and difficulty of commercial property investing, and encouraged new investors not to be intimidated. He also advised keeping all proceeds from sales to reinvest and continue growing the portfolio. Overall, his message is that with hard work and persistence, success in apartment complex investing is possible.
Simplify real estate investing with IDG or BAM Capital: Investors can secure attractive returns through IDG's rent to own homes or BAM Capital's multifamily syndications, each offering unique benefits and strategies.
Both Integra Development Group and BAM Capital offer unique opportunities for investors looking to simplify the real estate investing process and secure attractive returns. With IDG, investors can benefit from immediate cash flow, built-in equity, and a foolproof exit strategy through their rent to own single family homes in Florida. Meanwhile, BAM Capital, a trusted multifamily syndicator, provides accredited investors with opportunities for generational wealth building or monthly income through their investments in institutional quality assets with a disciplined investment strategy and a track record of delivering strong returns. For those considering buying commercial land, it's essential to carefully consider the cash flow implications and have a clear end game in mind. And for those looking for 100% financing, it's important to carefully assess the deal and consider creative financing options. Overall, partnering with a reputable real estate investment company can help investors navigate the complexities of the market and make informed decisions.
Navigating Real Estate Deals with Limited Experience or Financing: Strong financials, a solid property, and persistence are crucial for real estate deals, even with limited experience or financing. Gather info directly from the source and be transparent to improve chances of success.
With a good real estate deal, there are various options to make it work despite having limited experience or financing. The speaker shares his personal experience of acquiring properties with no experience and the challenges he faced in getting financing. He emphasizes the importance of having strong financials and a solid property to present to lenders. When evaluating a property, it's crucial to gather as much information as possible before reaching out to the seller or realtor. The speaker suggests contacting the right person directly and being transparent about not being a broker to ensure better service and a higher chance of getting the information needed. In summary, having a good deal and being persistent are key factors in overcoming challenges in real estate investing, whether it's getting financing or acquiring valuable information.
Overcoming Obstacles in Real Estate and Personal Growth: Read Brandon Turner's book for real estate tips and Ryan Holiday's book for mental hurdle strategies. Persistence in hobbies like running, traveling, and reading can parallel the persistence needed in real estate investing.
Overcoming obstacles is a common theme in both real estate investing and personal growth. Brandon Turner's book "Investing in Real Estate with No (and Low) Money Down" and Ryan Holiday's book "The Obstacle is the Way" were recommended as valuable resources for overcoming the mental hurdles and fears that come with real estate investing and business endeavors, respectively. Brandon also shared his hobbies outside of real estate, including running, traveling, and reading, which he sees as parallels to the persistence required in real estate investing. Additionally, it was revealed that Mindy and Maria from Sesame Street share a similar voice.
The Importance of a Strong Work Ethic in Real Estate: A strong work ethic and persistence are crucial for success in real estate. Hands-on ownership and hard work significantly increase the chances of success, as evidenced by franchise statistics.
A strong work ethic and persistence are key factors that distinguish successful real estate investors from those who fail or give up. Brian Murray, a seasoned investor, emphasizes the importance of being hands-on and working hard when starting out in real estate. He believes that having a solid work ethic significantly improves one's likelihood of success, as shown by statistics from franchises that prefer hands-on owners. Real estate is a business, and like any other, having a strong work ethic can make all the difference. To learn more from Brian, check out his book "Crushing It in Apartments and Commercial Real Estate" and connect with him on BiggerPockets.
Starting Real Estate Investing with No Money or Low Budget: Financial freedom through real estate investing is achievable, regardless of your budget. Find an investor-friendly agent and start small to earn consistent income.
Successful real estate investing doesn't always require a large budget. The guest shared his strategies for getting started with no money or low money down, earning $80 per deal. It's an inspiring story filled with great ideas that the hosts learned a lot from. They encourage listeners to leave a review or rating on iTunes to help spread the word about their podcast. Additionally, they discussed the importance of finding an investor-friendly agent to help navigate the market and make informed decisions. The hosts also took a moment to introduce Mindy's daughter, Rosie Lou, to their YouTube audience. Overall, the key takeaway is that financial freedom through real estate investing is achievable, regardless of your budget.
