Episode 510
Active vs Passive Investing: Deciding the Right Approach for Maximizing Real Estate Profits with Guido Nunez
Welcome back to another episode of the REI Mastermind Network! On today's show, host Jack Hoss is joined by special guest Guido Nunez to tackle the topic of wasted time in the workplace. They dive into the various factors that contribute to inefficiency, such as distractions and unoptimized processes. But fear not, they also provide valuable insights on how to eliminate waste and maximize productivity.
In addition to dissecting workplace productivity, Jack and Guido explore the world of real estate investing. They discuss the importance of prioritizing tasks and aligning them with goals, as well as deciding between active and passive investing. They shed light on alternative investment opportunities and share their strategies for success.
As the conversation unfolds, they delve into the nitty-gritty of real estate investing, including stress testing properties, evaluating market potential, and understanding financing options. Jack and Guido draw from their own experiences, both the challenges they faced and the lessons they learned along the way.
But it's not just about investing in properties, it's about building meaningful relationships within the industry. They reveal their secrets to networking and finding reputable experts in the desired market. From property managers to maintenance professionals, they share their tried-and-true methods for assembling a top-notch team.
And don't miss their expert advice on managing properties, from enhancing security to dealing with troublesome residents. They discuss the nuances of different property types, with a focus on D-class properties, which offer unique advantages for beginner investors.
So whether you're looking to optimize your productivity in the workplace or dive into the world of real estate investing, this episode is packed with valuable insights and practical tips to help you master the game. Let's jump right in!
Connect with Guido Nunez: theW2investor.com
Key Topics and Bullets:
Primary Topic: Wasted Time in the Workplace
- Coworkers and distractions as sources of wasted time
- Suggested solutions: automating tasks and simplifying decision making
- Importance of prioritizing tasks based on importance and aligning with goals
Primary Topic: Active vs. Passive Investing
- The decision to be an active investor or a passive investor
- Time constraints for certain professions, like doctors or surgeons
- Alternative ways to invest as a passive investor, such as joint ventures or syndications
Primary Topic: Property Investment Considerations
- Importance of stress testing the property to understand breakeven point and potential negative cash flow
- Examination of property location and market appreciation potential
- Assessing the neighborhood's position and potential improvement in three years
- Value of the property based on the difference between current rent and market rent
- Financing considerations
Primary Topic: Overcoming Challenges in Real Estate Investing
- Limited financial resources when starting out
- Cost of mentorships in the field
- Strategies for acquiring knowledge: books, audiobooks, podcasts, meetups, learning from everyday investors, watching YouTube videos
- Emphasizing the time-consuming nature of the learning process
Primary Topic: Finding Opportunities in Real Estate
- Importance of direct communication with sellers
- The realization that taking action and responding promptly is more important than having a perfect script
- Lesson learned about treating everyone with respect, particularly when dealing with D class properties
- The goal of conveying to residents that improvements are being made
- Appreciation from majority of residents, managing troublemakers
Primary Topic: Building a Network and Finding Experts
- Importance of building a network
- Seeking out experts in desired markets
- Example of reaching out to brokers for property manager recommendations
- Asking property managers for maintenance professional recommendations
Primary Topic: Enhancing Property Value and Resident Satisfaction
- Importance of security in properties
- Factors for creating a safe environment: good lighting, secured gates
- Addressing troublesome residents
- Cleaning up the property to increase rental income and property value
- Importance of a reliable contractor for property management
Primary Topic: Transitioning from Residential to Commercial Real Estate
- Starting in single-family homes and exploring commercial real estate
- Transition due to layoff and the desire to supplement income
- Background in residential real estate from mother being a real estate agent
- Management ease in decont properties compared to other types
- Cost-effectiveness and recommendation for beginner investors
- Prevalence of older buildings and starting investment locally
- Risk of illegal activities if not closely monitored.
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"You can invest 10,000 hours and become an expert or learn from those who have already made that investment." - Jack
Transcript
We have Guido Nunes with me here today, and you can learn more
Speaker:about what him and his team are up to by going to thew2investor.
Speaker:com.
Speaker:I'll make sure they have that as a clickable link in the show
Speaker:notes, but really appreciate your time here today, Guido.
Speaker:Jack, thank you.
Speaker:So we're going to be talking about how to maintain a W 2 job
Speaker:and be a real estate investor.
Speaker:And you've successfully done that now, building up to 200 plus doors.
Speaker:in your various markets.
Speaker:So this is going to be great.
Speaker:Yeah, it's been quite the journey.
Speaker:It's been ebbs and flows, good days, bad days, it's a long game and it's been good.
Speaker:Before we hit record, you had mentioned that you found your way
Speaker:into real estate investing because you came to the realization that
Speaker:wealth isn't created by your W 2 job.
Speaker:Can you talk a little bit about that
Speaker:journey?
Speaker:Yeah.
Speaker:I was laid off somewhere like 2011 and, I gained a lot of just
Speaker:self awareness during that time.
Speaker:Particularly that someone else controls your path and stuff,
Speaker:but, I realized other things.
Speaker:For example, as W2 workers, we wait for that yearly raise and or we
Speaker:work really hard for that promotion.
Speaker:And the reality is although that's nice, it's not going to get us to wealth.
Speaker:The path to wealth really isn't through earned income, it's through
Speaker:passive income and multiple streams.
Speaker:And, I learned I had to figure that out and create new
Speaker:revenue streams for my, myself.
Speaker:Yeah, that's interesting.
Speaker:I had a similar story regarding a employer that I was working with and
Speaker:I thankfully had taken another role within the company and then two weeks
Speaker:later, my entire team was let go.
Speaker:So I was the lone guy.
Speaker:I somehow managed to dodge that, but it was really an eye opener
Speaker:when all of your friends that you've been working with for a number of
Speaker:years just were let go all at once.
Speaker:Yeah, it's true.
Speaker:There's a saying that you and the company are even every two weeks.
Speaker:And that's the absolute truth of it, and most like when you start looking at
Speaker:wealth and wealthy people, a lot of 'em, didn't make their wealth on earned income.
Speaker:Unless you can make that executive suite rank and even those.
Speaker:People are, they make their money through the equity side and
Speaker:not so much the paycheck side.
Speaker:It's, it's important to diversify yourself.
Speaker:So can you talk a little bit about the strategies?
Speaker:What did you first get into when you were now trying to find
Speaker:opportunities in real estate investing?
Speaker:Yeah, so the first one was I didn't want to go in cold feet.
Speaker:I didn't have a ton of money when I started.
Speaker:So there's a lot of mentorships.
Speaker:They're really expensive, anywhere between 20, 000 and 50, 000 now I hear.
Speaker:So first thing I had to do is just become, smarter about what I was doing.
Speaker:And I just, got a ferocious appetite to learn, read books, audiobooks,
Speaker:paperback books, podcasts, meetups.
Speaker:Just calling everyday investors, just trying to, learn from them.
Speaker:And that was the number one thing I had to do is become smarter
Speaker:about what it is that I was doing.
Speaker:I'd watch YouTube and how to underwrite, I'd underwrite
Speaker:deals myself, a ton of them.
Speaker:Just trying to figure out is it good, is it not?
Speaker:So I just gave myself the class.
Speaker:That I needed, but it didn't happen, overnight or within
Speaker:a week, this was a process.
Speaker:And even today, I'm still, a student of everything I'd like to say,
Speaker:but that was the very first thing.
Speaker:So now that you're in it, you're, you've worked your way up to 200 doors.
Speaker:Did you start with single family and work your way to multi, or did
Speaker:you jump right into multifamily?
Speaker:No, I started a single family.
Speaker:I always feel like, In the commercial space, it's always
Speaker:like the entrance to it.
Speaker:I'm sure others go straight, but I dabbled in, in single family home flips
Speaker:a little bit and I thought it was cool.
Speaker:But I stopped for quite a bit and right when I got laid off and the market turned.
Speaker:I started trying to figure out what else can I do to supplement my income?
Speaker:And I started thinking about, ways to flip houses.
Speaker:Not a lot, but, at least I have some background in that.
Speaker:And then my mom was an, was a real estate agent at the residential sites.
Speaker:I just remember her, teaching me a lot of lessons.
Speaker:And so I was just like maybe I should just do the next best thing.
Speaker:And that's apartments, commercial real estate.
Speaker:That's where I started learning and I started looking at deals and I started
Speaker:realizing that I also needed time.
Speaker:And so the second lesson of being a W to worker and managing the portfolio is.
Speaker:It's finding the time to do it.
Speaker:And that was where the second lesson came.
Speaker:And it's probably one of the biggest things that I've done
Speaker:that has made me successful.
Speaker:It's balancing those two time commitments.
Speaker:Yeah, I was going to get...
Speaker:Actually, that's a great segue.
Speaker:I was going to ask you about that.
Speaker:How do you balance your W 2 job, which I'm sure is fairly demanding, and
Speaker:then now you're, you have 200 doors.
Speaker:How do you find that balance and how...
Speaker:What type of systems or team have you put in place in order
Speaker:to get this accomplished?
Speaker:Yeah.
Speaker:That that's a great question.
Speaker:I feel like we have to unpack it so much there.
Speaker:The first part is I love this movie The Pursuit of Happiness of Will Smith.
Speaker:And there's a quote in there that really resonated with me a lot is, what Smith
Speaker:is trying to do all these cold calls and he has to pick up his son as well.
Speaker:I think it was like five o'clock.
Speaker:And, he said, I had to learn to do in nine and six hours what
Speaker:other people did in nine hours.
Speaker:And that really resonated with me.
Speaker:So I started thinking about it.
Speaker:Okay what in nine hours or what do the typical W 2 worker do
Speaker:that takes them so much, right?
Speaker:It's not unheard of to hear people say, I work 11 hours or 12.
Speaker:I have to work on Saturday, but what is it that we do?
Speaker:So in that, I started thinking, that there's a lot of waste in there, right?
Speaker:There's a lot of the coworker that comes with a cup of coffee.
Speaker:Wasting your time is a lot of negativity.
Speaker:A lot of fluff in the day.
Speaker:So I just started getting rid of all that out of the day.
Speaker:I started looking in my daily life, how to automate everything that I could
Speaker:possibly do, how to get just be faster.
Speaker:And I just started simplifying even in my decision makings that I do.
Speaker:If it's not critical, if it's not urgent if it's nice to have and it
Speaker:doesn't meet the goal that, that I'm working on, that's the steps that
Speaker:I take my decision making process.
Speaker:It, it is really streamlined the way that I go through my day efficiently
Speaker:and that has freed up so much time.
Speaker:Now in terms of the properties goes it just depends on the deal.
Speaker:Like some deals we have teams.
Speaker:Obviously, we have property managers.
Speaker:We have, or go to maintenance people.
Speaker:We have our brokers.
Speaker:So in terms of the properties, we have teams that, that we trust,
Speaker:we rely on, we have systems and that has helped quite a bit.
Speaker:In how we tackle our daily necessities.
Speaker:It didn't, begin that way through time and we just became more efficient.
Speaker:Yeah, that's really some of the background
Speaker:now.
Speaker:Be curious as to, you mentioned that you've streamlined even
Speaker:some of your decision making.
Speaker:It's definitely sounds like it has impacted not only your W two job,
Speaker:but your real estate investing.
Speaker:Would you say that it's impacted?
Speaker:Your work at your W 2 job has improved or nobody notices?
Speaker:Yeah,
Speaker:Funny you say that.
Speaker:Within that same time frame, I actually won a big award in my industry.
Speaker:So for me, it was...
Speaker:a great accomplishment because it proved that you can be successful in multiple
Speaker:things at the same time And to answer your question has you know, did it improve?
Speaker:I think so.
Speaker:You know has it been noticed?
Speaker:Probably not, but it's a good thing, right?
Speaker:Cause if it's noticed, it's probably means that you're messing something
Speaker:up and you probably know you prefer not to be noticed that, you're
Speaker:on the investing side as well.
Speaker:And I like it that way, as
Speaker:well.
Speaker:This is really timely because I've been rereading the four hour work week.
Speaker:If you're familiar with that book.
Speaker:No,
Speaker:I read a lot, but I'm not.
Speaker:Is it good?
Speaker:Yeah, it is good.
Speaker:And there's a lot of tips and strategies in there to essentially do some of
Speaker:the things that you're suggesting.
Speaker:He just has different tactics that you can implement to, he's not pushing
Speaker:the concept of a four hour work week.
Speaker:He's pushing the concept that you can do as much work in a smaller amount of time.
Speaker:Than you do today?
Speaker:Yeah, I think so too.
Speaker:You could do as things as, as easy as when you write emails, just
Speaker:being concise to the point, I found myself in the past just overreading
Speaker:something and overriding something.
Speaker:And if you just get to the, if you know what the goal is, right?
Speaker:If you know what the goal is and you just right to that goal and get to the point
Speaker:you'll get things done a lot faster.
Speaker:And it's easy as.
Speaker:I hate to say is as that, but it is right.
Speaker:I know exactly what you mean there, because this is was a
Speaker:hurdle for me when I was first starting to real estate investing.
Speaker:One of, one of our strengths is actually finding opportunities, whether in single
Speaker:family homes and talking to sellers and responding to sellers directly
Speaker:and email texts and what have you.
Speaker:And I was always.
Speaker:Looking for the script, if you will, those perfect words in order to get something
Speaker:accomplished, not necessarily tricking anybody, but you just have this in the
Speaker:back of your head that there needs to be a sequence of events or a sequence
Speaker:of words that unlocks this opportunity.
Speaker:What that is actually just responding and taking action.
Speaker:That's more important than trying to craft the perfect response.
Speaker:Yeah.
Speaker:And I like how you said that like taking action.
Speaker:And I think we, we say that a lot, right?
Speaker:But that is really what it is, right?
Speaker:It's like you got to take the action instead of talking so
Speaker:much about it take the action.
Speaker:And it can sometimes is it is as simple as you think it is.
Speaker:So can you talk a little bit, what type of properties are you investing in now?
Speaker:So we are in a range of 10 to 80.
Speaker:And right now we're focused in on going all more in that.
Speaker:40 to 60 range.
Speaker:It's all multi units, right?
Speaker:Yeah.
Speaker:Yes.
Speaker:All multifamily apartments.
Speaker:That's is our focus.
Speaker:That's all we do.
Speaker:We like storage.
Speaker:We're not in storage right now.
Speaker:It's probably one asset type that I'd love to be in, but we're focused.
Speaker:We know we were good on We're good at.
Speaker:It's multifamily.
Speaker:We like the markets we're in.
Speaker:So it's one of our core competencies.
Speaker:So that's what we're focused on.
Speaker:Okay.
Speaker:So is there a particular class you focus on?
Speaker:Yeah.
Speaker:So great question.
Speaker:I, when I started this, I got in the class D, which is if you're familiar
Speaker:with the commercial apartment, A is the best and D is really rough areas.
Speaker:That is what kind of taught me a lot of lessons in multifamily.
Speaker:Now we're getting into the B class, which is a lot nicer.
Speaker:You can walk through the properties and sit on the bench.
Speaker:That
Speaker:is a big shift.
Speaker:D to
Speaker:B.
Speaker:Yeah.
Speaker:We were in the C.
Speaker:We went to from D in C's.
Speaker:Now we're going to two B's.
Speaker:Our most recent acquisition was a B will be mine.
Speaker:It's pretty close.
Speaker:But it's,
Speaker:what did, what made you ask the question to be or not to be?
Speaker:Yeah, I like the way you put it,
Speaker:It was aspiration.
Speaker:I want it to be a nicer products.
Speaker:It was just, it's, the deal is always going to.
Speaker:Lead, right?
Speaker:So it has to underwrite.
Speaker:It has to make money and we can go down the checklist of
Speaker:everything that it has to do.
Speaker:But we, I want it to be there in a B class.
Speaker:It's just a nicer product is everything is nicer about it.
Speaker:And for me, aspirational wise, I wanted to go that way.
Speaker:So we really focused in on doing that.
Speaker:Just to remind everybody, it is called the w two investor.
Speaker:com.
Speaker:That is a clickable link in your show notes.
Speaker:Do us a quick favor, if you like what you've heard so far, share it
Speaker:with one of your investor friends.
Speaker:I do have, be curious, do you have a list of what are some of those things
Speaker:that you're looking for to make you comfortable enough to make the purchase?
Speaker:Yeah, so a few things.
Speaker:It has to stress test.
Speaker:We play around with that vacancy rate quite a bit.
Speaker:We try to understand, where that break even point is, where it's
Speaker:going to start hardiness in terms of negative everyday cash flow.
Speaker:We look at where the property's at, is it in one of the markets that
Speaker:we love is in neighborhoods that we think are going to appreciate.
Speaker:That's probably one of the biggest ones we, we look at In three years,
Speaker:is the neighborhood going to be in a better position where it's at?
Speaker:And probably one of the most important ones is how much room is there?
Speaker:Excuse me, Jack.
Speaker:How much room there is in the current rent versus market rent?
Speaker:Because that is what's going to drive the overall value of the
Speaker:property is, can we get it there comfortably without stretching it?
Speaker:So those are the main ones and everything else, obviously we're going to look at the
Speaker:financing is it going to cash flow in day one versus month six, that kind of thing.
Speaker:But that is the main things that we're looking for, obviously makes it
Speaker:so you obviously learned quite a few lessons with your D properties.
Speaker:Yeah were there some action plans, not only in taking
Speaker:over the D property, but what.
Speaker:Were you trying to do some sort of forced appreciation there?
Speaker:Yeah, so with the properties I've learned that we're not really looking
Speaker:at amenities in the sense of there's a pool or there's preferred parking
Speaker:that kind of thing and deep properties what residents want It's security.
Speaker:And then that comes in, good lighting, right?
Speaker:Secured gates.
Speaker:So when we take over the property, that's the first thing that we're
Speaker:looking at is, how safe is that property?
Speaker:How comfortable are our residents?
Speaker:Are there residents that are troublemakers that, we need to Address, right?
Speaker:Is there a lot of junk on the property that makes it like an eyesore?
Speaker:So those are the main things that when we take over like deep
Speaker:properties, we're looking at.
Speaker:We've taken over properties where there's a bunch of cars that don't even work.
Speaker:They're just sitting in the parking lot.
Speaker:So those are the kind of the basic things.
Speaker:That you can do to clean up a deep property that, that residents would more
Speaker:than appreciate you for and it helps out in the rental income and the value.
Speaker:Yeah, it reminds me of the, there was mayor of New York who was taking care
Speaker:of some of the details when you start to take care of the property and deal
Speaker:with some of the details the residents.
Speaker:start to take a little bit more pride in and in their actions as well.
Speaker:Yeah.
Speaker:And it's completely true because the other piece of it that we do is we write up
Speaker:new rules and policies for the property.
Speaker:And we communicate it to all the residents and.
Speaker:We ensure that everybody's following it right because that puts everybody
Speaker:that accountable right to the property and to the living of it as well.
Speaker:To your point, everyone's and start taking care of where they live when you
Speaker:start, promoting those type of living.
Speaker:So could you share with us a little bit about what's one of the biggest
Speaker:lessons you've learned, or maybe one of the biggest mistakes you've made?
Speaker:And what did you learn from it?
Speaker:I don't think it's a biggest mistake, but the biggest lesson that I learned in
Speaker:terms of D class properties is, you want to treat everybody with a lot of respect.
Speaker:When we start knocking on doors and, introducing ourselves, at least our
Speaker:our team, we want to just come across as that we're trying to improve the
Speaker:property and this is what we're doing.
Speaker:And, you'll find that nine out of 10 residents appreciate you for that.
Speaker:And they're always going to be the one that, maybe the troublemaker.
Speaker:But you definitely want to see that as well.
Speaker:That's the source of the issues.
Speaker:But I would say that is you never want to go into a property just like
Speaker:a hard ass or anything like that.
Speaker:At the end of the day they're people and they're hardworking as well.
Speaker:And so you want to partner up with them.
Speaker:Have you noticed is there's one thing in particular or one, one
Speaker:improvement that kind of surprised you that had a big, the biggest reward?
Speaker:Yeah.
Speaker:We took a property over where it's a property was a problem in itself
Speaker:where the middle community garden or walkway they completely fenced it off.
Speaker:So the residents were forced only to come on the property and they
Speaker:go right into their apartments.
Speaker:And although that middle garden was beautiful to sit down and have a cup
Speaker:of coffee or barbecue or do whatever, they couldn't get into it, right?
Speaker:Because the previous owner just couldn't control the problems.
Speaker:We opened it up and we, we invested in benches and new landscaping and,
Speaker:We wanted people to come in and sit down and we didn't do that on day
Speaker:one, obviously we had implementers or security lighting gates.
Speaker:We had to talk to our tenants, new rules.
Speaker:But once all that came to play, we removed all those gates.
Speaker:And it was one of the most appreciated things that I that we've gotten.
Speaker:Where our property manager just told us how much our residents
Speaker:loved us for doing that.
Speaker:It's sometimes it's as simple as that.
Speaker:Yeah,
Speaker:I, I know.
Speaker:It's interesting.
Speaker:One of the things that we had started doing was to incentivize people.
Speaker:There was a point where there was a lot of competition for Apartments in
Speaker:my market and we've, we were seeing people giving away TVs and free
Speaker:months of rent and all of this stuff.
Speaker:And the best thing we did was give them a choice of an accent wall or
Speaker:something that actually stayed with the property and improve the unit.
Speaker:Yeah.
Speaker:That's a I love that idea because I've never heard of TVs.
Speaker:I've included a refrigerator, excuse me, because in our California
Speaker:properties, units don't have refrigerators, at least in the C C class.
Speaker:We started including them in the units as just a bonus for coming with them.
Speaker:That's like a 400, 500 appliance but it stays with the unit.
Speaker:It's in, it's in the lease that it's ours.
Speaker:We're just letting you use it.
Speaker:But sometimes You just got to get a little bit creative.
Speaker:Yeah.
Speaker:That's one of those things that's always floored me because in my market.
Speaker:You have to have all of the appliances in there.
Speaker:That's not an option.
Speaker:Yeah.
Speaker:I hear something like that.
Speaker:You're, you have apartments that are common without a refrigerator.
Speaker:That's new.
Speaker:Yeah.
Speaker:And you're right.
Speaker:Cause in Arizona properties, you have to have.
Speaker:Refrigerators.
Speaker:So yeah, in California, you don't, and the residents expect that you don't.
Speaker:We'll just touch on it briefly, but it sounds like you have quite
Speaker:the footprint of your 200 units.
Speaker:How has your out of state investing been gone?
Speaker:It's been doing good.
Speaker:Yeah.
Speaker:So we have it in Arizona.
Speaker:We had it and when in Tennessee, we just sold one in South Carolina.
Speaker:But it's been doing pretty good.
Speaker:So we're happy.
Speaker:I think.
Speaker:Part of the success that we have is we just are pretty diligent in what we
Speaker:do in our underwriting and the markets that, that we're in, the product that,
Speaker:that we buy and most importantly, in, in the partners that we take.
Speaker:I get, emails or calls from different syndicators or investors
Speaker:wanting to do deals, but.
Speaker:I won't do a deal with somebody that I don't know.
Speaker:I have to, build a relationship, know what they're up to.
Speaker:see a proven record.
Speaker:And when we, when I do deals, it's because I've built that relationship.
Speaker:I've seen a track record, I've hung out with them I know they're within the same
Speaker:scope that, that I want my partners to be.
Speaker:We get along,
Speaker:sure.
Speaker:Maybe you can come back on the show.
Speaker:We can dive a little bit deeper on that and we can even hit on your
Speaker:experiences doing those syndications.
Speaker:Yeah, absolutely.
Speaker:And I think it's important because as a W 2, investor or W 2 worker wanting to be an
Speaker:investor, you have to really think about.
Speaker:Do you want to be an active investor?
Speaker:Cause that takes a lot of time and there are professions where, you
Speaker:can't multitask, like doctors or surgeons obviously can't multitask
Speaker:being an investor role because they're needed in the office in person.
Speaker:But it doesn't mean that you can't be an investor.
Speaker:There's other ways to do it.
Speaker:You could do joint ventures.
Speaker:Where your partners are doing some some of the heavy lifting.
Speaker:You could be in syndications where you're an investor, but you're in
Speaker:a passive role, but you're still an investor and a hard asset.
Speaker:So it just depends.
Speaker:Yeah, we can certainly
Speaker:talk about it.
Speaker:I'd be curious as to, since you obviously had to rely on a team, do you have
Speaker:some tips and strategies to make sure that you have the right team members?
Speaker:Yeah, it just depends.
Speaker:I do a lot of referrals or reaching out to my network.
Speaker:So the first tip that I would say is build out your network as much as you can.
Speaker:And find out who are the experts within that market or wherever it is
Speaker:that you want to do, for example in Arizona, we reach out to the largest
Speaker:brokers in those areas and we say, who are the property managers that
Speaker:you're hearing are good, right?
Speaker:That starts to build a team there.
Speaker:Within property managers, you start asking who are the best maintenance guys
Speaker:or gals out here that, that can help us.
Speaker:And they'll refer you like my, my contractor who does a rental and
Speaker:whatever properties in his own.
Speaker:He's great.
Speaker:I can't say that enough.
Speaker:But I found him just through a referral of my property manager,
Speaker:which my property manager was referred to me by one of my brokers.
Speaker:That I trust.
Speaker:So in building the team, that's what I would say.
Speaker:Build a network, find the great people and ask them who they know are also great.
Speaker:Yeah.
Speaker:I can't stress that enough.
Speaker:Referrals are like the way to go.
Speaker:If you can get that's why.
Speaker:We ask for referrals here.
Speaker:If people find value in the show, there, there's nothing that shows that you
Speaker:like something or it just pays dividends when it comes to sharing episodes,
Speaker:getting referrals regarding just handyman work or building out a team.
Speaker:I don't think there's anything better
Speaker:to make sure you're just life a lot easier.
Speaker:And it goes back to We're talking about finding efficiencies in your day because
Speaker:when you start having the wrong person in the role or maybe you're going to go
Speaker:cheap on something because you want to save a couple of dollars that adds a lot
Speaker:of work to your day where when you have the right people and you say, okay I'm
Speaker:going to have my, I have a full time job.
Speaker:But I also, I'm going to invest on properties on the side.
Speaker:Okay.
Speaker:That should give you even more motivation to have to pay a slight premium to get
Speaker:the right people to help you out of state.
Speaker:Because that's going to make your life easier on the other side.
Speaker:And corners.
Speaker:Yeah, I, you, you said when it comes to paying for the right people that it
Speaker:just touch briefly on it, you've talked about starting in D properties, moving
Speaker:to C, moving to be a lot of people have this mind in their mind that the
Speaker:D properties are actually where you're going to find the biggest discounts where
Speaker:you're going to make the most money.
Speaker:But have you found that to be the case as you moved up into the B properties?
Speaker:Has it become less stressful?
Speaker:Are those properties easier to manage?
Speaker:Is it a different clientele?
Speaker:Yeah, so most of our property acquisitions have been in the
Speaker:D and C, mostly in the C's now.
Speaker:The B, we just got the first B.
Speaker:So what I would say is 100 percent true, the clientele is nicer.
Speaker:I'm just trying to figure out the right word nicer.
Speaker:Yes, it's the management is a little bit easier, right?
Speaker:So that's 100 percent true.
Speaker:In the D classes, it does have its headaches.
Speaker:You can get them cheaper for sure.
Speaker:So for beginning investors, that's a good way in is finding D class properties.
Speaker:Probably a little older, depending on the state you're in, you'll
Speaker:find some more older buildings.
Speaker:But biggest caveat I will give on that or the biggest tip is if you're a new
Speaker:investor And you want to go in that way because it's cheaper Do it locally first
Speaker:buy that deep property locally first because you're gonna you're gonna have
Speaker:to drive by it quite a bit to make sure that everything you're implementing is
Speaker:working because the last thing you want is it to become the wild west and then
Speaker:the guys are selling drugs out of the side door because that happens, right?
Speaker:So once you do it locally and you have a strong property manager,
Speaker:that becomes then your lessons.
Speaker:You become better on doing this and once you become better, then you can go out
Speaker:of state in a rough area because then you've already learned all your lessons.
Speaker:locally on that.
Speaker:So that, that, that is the big tip I'll give.
Speaker:Yeah,
Speaker:no, great tip.
Speaker:Guido, this has been a great conversation.
Speaker:One more time, the w two investor.
Speaker:com.
Speaker:But before I let you go, are you ready for some rapid fire?
Speaker:I
Speaker:hope so.
Speaker:So what is a lie?
Speaker:Every real estate investor tells themselves.
Speaker:I would say that they tell each other is, it's probably the
Speaker:number of doors that they have.
Speaker:that they own.
Speaker:When in reality is how many of those doors they actually have under management.
Speaker:That's a big difference.
Speaker:Yeah, that's a number that is constantly being thrown around as well and you don't
Speaker:really get a complete grasp or insight of how much money they're making per door
Speaker:either.
Speaker:Yeah, you don't.
Speaker:And as we're talking about this, that's another good tip for anyone
Speaker:that wants to be a passive investor.
Speaker:If someone tells you, Hey, I'm in like a thousand doors.
Speaker:Instantly you think they, they must be, a guru, they know what they're doing,
Speaker:ask the question, how many of those thousand doors are actively being managed
Speaker:under their management versus not.
Speaker:So that, that should tell you a little bit of some of that.
Speaker:So do you have a book recommendation or what are you reading right now?
Speaker:Yeah, so I, I'll go with a recommendation.
Speaker:I, my, my top book is cashflow quadrants.
Speaker:It's an eye awakening in so many levels.
Speaker:And it actually talks a lot about earned income in how that really
Speaker:takes away from wealth versus passive income and how to build that.
Speaker:So I love that book.
Speaker:Yeah, that's
Speaker:actually my favorite of his as well.
Speaker:Yeah.
Speaker:Yeah.
Speaker:It's actually his best.
Speaker:If you want a motivation book can't hurt me, David Goggins.
Speaker:That's another eye opening one.
Speaker:What is one tool you can't live without, whether it's for business or personal?
Speaker:My phone.
Speaker:Yeah.
Speaker:And it's not because I'm scrolling on Instagram.
Speaker:I communicate with my property manager, my contractor, my partners,
Speaker:and I do it in such an efficient way.
Speaker:Where, I can make decisions, approve CapEx right at the click of my thumb.
Speaker:And that's my phone.
Speaker:If you could go back in time and give your younger self one piece
Speaker:of advice, what would that be?
Speaker:Start now.
Speaker:Start now.
Speaker:I can't tell you how much I think about that.
Speaker:And that's an advice I would give someone who wants to be an investor themselves.
Speaker:It's just if you wait a year.
Speaker:In that year passes, think about where you would have been, and if
Speaker:you wait another year, think about how much time has passed start now.
Speaker:And it could be as easy as you pick a book, you go to a
Speaker:meetup, listen to a podcast.
Speaker:make some connections.
Speaker:It could be as easy as that.
Speaker:If you don't have the money to do a mentorship program to warp
Speaker:speed your way up, start there.
Speaker:But start
Speaker:in under 60 60 seconds, you have to give everybody a tip or trick
Speaker:that they can implement today.
Speaker:What would it be?
Speaker:This may be a little bit tactical, but I found that low water efficient devices.
Speaker:Although unsexy, cut your water bill down by 30%.
Speaker:And in multifamily where that is such a big piece of your utility and expense
Speaker:implementing something like that.
Speaker:Particularly if your city is Paying for some of it through rebates which I've
Speaker:done is a great bang for your buck.
Speaker:In terms of monthly expenses and also when you sell the property in
Speaker:terms of just a value add to the new owner that they're, purchasing a
Speaker:value, an efficient utility building.
Speaker:Guido, is there a question or concept you wish we would have covered here today?
Speaker:Yeah, I would just reiterate just the whole idea of, being a W two
Speaker:worker and kind of pondering wealth.
Speaker:And I think it's, the trick to wealth is what you do with your own income, right?
Speaker:Turning your earned income into passive income.
Speaker:I think it's important.
Speaker:And, just really thinking about that thoroughly and how you do that.
Speaker:Don't wait.
Speaker:This is what I would say.
Speaker:This was great again.
Speaker:It is the w two investor.
Speaker:com, but I hope you'll come back again sometime.
Speaker:This was great.
Speaker:Thanks Josh.
Speaker:I appreciate it.
