Podcast Summary
Recapping experiences at a financial blogger conference and celebrating BiggerPockets anniversary: Discover valuable insights for real estate investors, learn about DealMachine for unlimited leads access, and explore Rent to Retirement for no money down rental properties.
The Bigger Pockets podcast, episode 41, features hosts Josh and Brandon recapping their experiences at a financial blogger conference in Saint Louis. They also celebrate the 9th anniversary of biggerpockets.com and express gratitude to their listeners. The guest for this episode is Douglas Larson, an investor from Utah. A notable point from the discussion is the mention of DealMachine, a tool that provides unlimited access to phone numbers and contact information for real estate leads at no extra cost. Another intriguing topic is Rent to Retirement, which offers the opportunity to buy new construction turnkey rental properties with no money down. Overall, the episode offers valuable insights for real estate investors and highlights useful resources for growing a successful investment portfolio.
Simplify the loan process for real estate investing: Host Financial offers easy qualification with light docs and common sense underwriting. Traditional lenders can be lengthy and complicated. Utilize resources like BiggerPockets for valuable tools and information.
There are lenders like Host Financial that make qualifying for a real estate investment loan easy with their light doc and common sense underwriting guidelines. Investors can get started with no or low money down, allowing for maximum cash flow appreciation and equity growth. Meanwhile, traditional lenders can make the process lengthy and complicated with extensive financial requests. Additionally, resources like the BiggerPockets forum offer valuable tools and information for new real estate investors. So, consider simplifying the loan process and utilizing available resources to grow your portfolio faster.
From San Diego to Maui: Real Estate Journey with Minimal Upfront Costs: Investors can enter expensive real estate markets creatively and adaptably through lease options, making rent payments and eventually buying the property.
Douglas started his real estate investing journey with a successful experience in San Diego County, where he bought a fixer-upper home for a profit. Inspired by this, he moved to Maui and faced higher prices but managed to buy properties through lease options, living in one and renting out the other. Lease options involve making rent payments and eventually buying the property, allowing investors to enter the market with minimal upfront costs. Douglas's experiences demonstrate the importance of creativity and adaptability in real estate investing, especially in expensive markets.
Sacrifices and extra effort in real estate investing: Real estate investing requires dedication, hustle, and making sacrifices to build wealth through strategies like lease options and seeing potential in challenging properties.
Real estate investing involves making sacrifices and putting in extra effort to build wealth. This can be seen through the example of structuring lease options, where investors put down a significant deposit upfront and make regular payments towards the down payment. This strategy not only motivates buyers to take care of the property but also leads to eventual ownership. Even in deals with significant challenges, like a property in disarray, investors can find success by seeing it as a blank canvas and having the determination to see it through. Real estate investors often remember every deal they've done, especially those where they've lost money, and becoming a full-time investor requires dedication and hustle, even before the smartphone era. This means making calls to real estate agents during lunch breaks or in between patients, and dedicating nights and weekends to renovating properties.
Focusing on good deals, not just lower prices: Investors should aim for phenomenal deals based on After Repair Value (ARV) rather than just lower prices when buying properties.
While some people may be able to perform certain tasks faster, better, or cheaper than others, it doesn't necessarily mean they're getting the best deals. The speaker, a real estate investor, shared his experience of moving from Hawaii to Utah and buying houses at seemingly lower prices but still needing to ensure good deals based on the After Repair Value (ARV) compared to neighboring houses. He also emphasized the importance of understanding what buyers want and focusing on getting phenomenal deals rather than just lower prices. Additionally, the speaker shared his personal story of quitting his day job to go full-time in real estate investing after proving its consistency and making a move to a new area with more affordable housing.
Key to successful real estate investing: Understand local market and recognize value: Investing in desirable areas requires higher capital but offers stable returns. Be adaptable and have enough capital to weather market downturns.
Understanding the local market and recognizing value are key to successful real estate investing. The speaker shared his experiences of investing in different areas, including Hawaii and Park City, Utah. He noted that while prices were higher in these resort towns, people were willing to pay for turnkey properties. In Park City, he saw signs of a healthy market and bought multiple properties, mostly for buy-and-hold strategy. However, during the housing market collapse in 2008 and 2009, he had to bring money to closing tables and even ushered tenants out to minimize losses. Through these experiences, he learned the importance of being adaptable and having enough capital to weather market downturns.
Exploring Multiple Exit Strategies in Real Estate: Having multiple exit strategies like cash flowing, selling, owner financing, non-traditional rentals, or moving in can mitigate risks and provide financial benefits in real estate. Adapt to market conditions with creative rental situations and comprehensive marketing efforts.
When investing in real estate, having multiple exit strategies is crucial to mitigate potential risks. Exit strategies can include options like cash flowing a lease or lease option, selling traditionally, owner financing, non-traditional rentals, or even moving into the property oneself. These alternatives can provide financial benefits and flexibility, especially during uncertain market conditions. For instance, in a creative rental situation, a property owner in Park City rented out his unsold property to resort employees during winter, generating substantial cash flow. However, it's essential to be aware of local laws regarding rental properties and occupancy limits. To attract tenants during winter or other seasons, marketing efforts should be comprehensive, including social media, local networks, and various online platforms. Remember, limiting yourself to one exit strategy increases the risks, so always explore various options.
Maximize your real estate investments: Mention keywords, use visually appealing ads, invest in passive income, utilize 1031 exchanges, and optimize banking for real estate success
Optimizing your real estate listings for search terms is crucial in today's digital world. Mentioning important keywords, such as location and desirable amenities, can significantly increase your listing's visibility. Additionally, using platforms like Postlets to create visually appealing ads and distribute them across multiple sites can enhance your listings' appeal. For those looking to invest in real estate without the hassle, consider passive income opportunities like Pine Financial Group's mortgage fund. This investment offers a targeted 8% preferred return and contributes to community revitalization. Another valuable tip is utilizing 1031 exchanges to defer capital gains taxes when selling investment properties. First American Exchange Company is a trusted resource for facilitating these exchanges. Lastly, for hassle-free banking, consider opening a business account with Relay, which allows for 100% online sign-up and collaboration features. Overall, these strategies can help you maximize your real estate investments and navigate the market more effectively.
Auction companies may place phantom bids to drive up prices: Beware of auction companies placing phantom bids to manipulate prices, potentially leading to overpaying.
Real estate auctions, both online and in-person, can involve bidding against not only other potential buyers but also phantom bids placed by the auction company itself to drive up prices. This practice, while possibly legal, can be misleading for buyers. The speaker shared his experience of this happening on an online auction, leading him to become the winning bidder despite his max bid being below the reserve price. He emphasized the importance of being aware of this tactic and bidding accordingly. The speaker has been funding his real estate purchases through his own money since 2009.
Communicating with your spouse about real estate investing: Effective communication and involving your spouse in the decision-making process can lead to a stronger partnership and greater success in real estate investing.
Effective communication and involvement are key to getting your spouse on board with your real estate investing business. The speaker shared his personal experience of initially facing skepticism from his spouse, but managed to win her over by involving her in the process and showing her the potential profits. He also suggested watching HGTV as a helpful tip to get your spouse interested in real estate investing. However, it's important to find a balance between work and home life, as too much integration of the two can blur the lines and potentially cause issues. The speaker's wife enjoys being involved in the decision-making process and being kept in the loop, but every couple must determine what works best for them. Ultimately, involving your spouse in the business can lead to a stronger partnership and greater success.
Setting aside family time each day is essential for work-life balance: Be conscious of work-life balance, set aside family time, and disconnect from work during designated hours to maintain healthy relationships.
Finding a healthy work-life balance is crucial, especially when your personal and professional lives intertwine heavily. The speaker shared his experience of how every conversation with his wife revolved around their business, leading him to consciously set aside family time each day. He emphasized the importance of disconnecting from work during designated family hours. Additionally, the speaker shared his past experience of working in a real estate mentoring company, where he encountered red flags such as being told that real estate investors don't make good salespeople and being asked to sign a lengthy nondisclosure agreement. He cautioned against falling for sales tactics that don't focus on cost-benefit and emphasized the importance of doing thorough research before joining any mentoring program.
Avoiding Aggressive Sales Tactics in Real Estate Investing: Instead of falling for aggressive sales tactics, seek out personalized action plans and practical knowledge from local mentors or accredited educational institutions.
The use of aggressive sales tactics, such as exploiting people's fears, failures, and vulnerabilities to sell overpriced products or services, is not an effective or ethical approach to real estate investing. The speaker's experience in a boiler room environment, where salespeople were encouraged to max out credit cards for education and then subjected to continuous sales pitches, left him feeling sick and disillusioned. Instead, he believes that investors should seek out personalized action plans and practical knowledge from local mentors or accredited educational institutions, rather than falling for continuous sales pitches. The origins of BiggerPockets, a popular real estate investing platform, can be traced back to the speaker's desire to create an alternative to these questionable practices. The platform aims to provide trustworthy and actionable information, free from sales pitches or hidden agendas.
Understanding the Differences Between Real Estate Gurus and Mentors: Real estate gurus and mentors have different approaches. Gurus focus on sales tactics, while mentors prioritize community building and teaching.
While some real estate gurus may not fully understand the inner workings of boiler rooms, it's important to distinguish between their sales tactics and the value offered by those who genuinely help others succeed. The latter group, such as Anson, Aaron, and Dave, prioritize community building and mentoring, making their resources invaluable to new investors. The BiggerPockets forums serve as an excellent example of this, with thousands of mentors willing to help others for free. The average timeline for flipping a property varies, but investors like Douglas aim for a 1-3 year hold strategy, while dealers, such as wholesalers and flippers, focus on quicker turnarounds. Ultimately, it's crucial to understand the differences between these roles and to seek guidance from those who genuinely want to help you succeed.
Finding Reliable Contractors and Optimizing Real Estate Purchases: Find reliable contractors by offering incentives and checking references. Buy properties wisely, considering seasonal price drops and property type. Replace old cast iron drains and use bold colors for flips to maximize value.
Finding reliable contractors is crucial for real estate investing, and the best ways to find them depend on your location. Contractors can make or break a project, so it's essential to keep them motivated and on the job. A good tip is to offer them food to keep them working efficiently. Regarding property purchases, the best month to buy can depend on the market and the type of property. For example, vacant land or extensive rehabs may be better buys in late fall or winter when prices are lower. When it comes to old cast iron drains, it's generally advisable to replace them before they cause problems, especially in older properties. Lastly, a favorite color door for a flip can be a matter of personal preference, but a bold color like burgundy or plum can make a house stand out.
Understanding strengths, learning from failures, and utilizing resources: Success in real estate investing demands a clear understanding of personal strengths and weaknesses, learning from past experiences, and utilizing resources like BiggerPockets for guidance and support.
Success in real estate investing requires a combination of knowledge, experience, determination, and a well-thought-out action plan. Douglas, the interviewee, emphasized the importance of having a clear understanding of one's strengths and weaknesses, as well as the importance of learning from past experiences and failures. He also highlighted the value of resources like BiggerPockets for providing guidance and support. The use of the phrase "failure is not an option" was mentioned as a common tactic used by gurus to appeal to those who are afraid of wasting their money. Hobbies and interests outside of investing were also discussed, with Douglas sharing his love for surfing and snowboarding. Overall, the conversation underscored the importance of staying focused, persistent, and committed to achieving one's goals in real estate investing.
The Importance of Perseverance in Real Estate Investing: Real estate investing involves facing challenges and requiring determination to keep going. Consistently put yourself out there, stay engaged in the community, and maintain a long-term perspective for success.
Perseverance is key in real estate investing. Douglas Larson, also known as "Lucky Larson," shared his experiences of facing market challenges and coming back stronger. He emphasized that investors will encounter ups and downs, and it's essential to have the determination to keep going. Lucky also mentioned the importance of creating your own luck by consistently putting yourself out there and staying engaged in the community. Overall, the discussion highlighted the importance of resilience and a long-term perspective in real estate investing. You can find Douglas Larson on Luckylarson.com and BiggerPockets. Remember, the community on BiggerPockets is a valuable resource for investors at any stage, so make sure to engage and get involved. Don't miss out on the wealth of knowledge and connections available. Connect with us on social media, follow us on Twitter, Facebook, LinkedIn, and Instagram for additional content and updates. If you're looking for an investor-friendly agent to help you navigate the market, use BiggerPockets Agent Finder to find the perfect match. Visit biggerpockets.com/deals and enter your details to get started. Investing in real estate requires dedication, hard work, and a long-term perspective. Stay engaged, keep learning, and don't give up – your success is worth it.
Leverage local market expertise for successful real estate investments: Partnering with local market experts on BiggerPockets.com/deals can provide valuable insights and actionable steps, leading to confident investment decisions and potential deals.
Partnering with local market experts through BiggerPockets.com/deals can significantly enhance your real estate investment journey. These experts can provide valuable insights into neighborhoods, data analysis, and actionable steps, helping you make confident decisions. This free resource can lead you to finding an investor-friendly agent and securing a deal, bringing you closer to financial freedom. However, it's crucial to remember that all investments carry risks, and you should consult with qualified advisors before making any decisions. Past performance does not guarantee future results, and the opinions expressed are those of the hosts and participants. Bigger Pockets LLC disclaims any liability for damages arising from the information presented in this podcast.
