2 Long-Distance Rentals with $0 Down with Tony Robinson
This is the real estate rookie show number ten. I'm great my deputy job Brad and I climb the corporate ladder and you know I'm I'm just killing it right once. I'm gone once I'm gone right. I can't pass that on to. My family prayed with real estate. I can can build this empire I can. I can have this machine once I'm gone. I know that that's going to keep giving giving and giving some my family. And that's arm to the Big Ten am actually care and I am here with the assistant to host May and his little Hula Dancer and his microphone off. That's right I got my Hula Hula. Man here But yeah finally ten episodes. Wow I can't believe we've made it this far people like us. I love it. Yes thank you. Everyone and we love the facebook group it is growing growing everyday. We're almost a six thousand. I believe yeah though today we have Tony Robinson on the show me actually recorded this. Previously before Corona virus happened and we reached out to Tony but not a lot has changed for him kind of the same as Mallory and Lucas on episode eight. They said not a lot of change for them. Either though Tony Hawkes about the deal that he rehabbed rented out and so far has tenant has been able to pay rent and then he told us when we talked to him that he was undergoing a Rehab. Right now finished it ready to rent. But he can't find anyone to run in and he's considering dropping the price. So what do you think about that bleep? Anglo would be your strategy. Yeah I think it's a good strategy. I think that tells a lot about him. I always told my friends and family that if we have to lower the rent to get people in the rooms in the house is then that's fine a drop my ego rent the place out. We got to have some cash coming in. It's better to do that than have nothing coming in right. Have an vacant. Property is like the worst thing you can do. So yeah absolutely you know. Get someone in there you have to lower the rent and then I like that. He said that one thing that he is changing is he used to only look for three bedrooms but now he's going to also look for two bedroom homes but the lot has to be big enough for him to add that third bedroom so really smart of him and then also considering section eight property. So I think it's really good and it says a lot about who he is in the show. He also talks about some of the things that he's had to overcome things that happened in his past when he was inspiring super inspiring. And things that you know even going on now so I think he's got the grit. I think Tony is going to be really good in real estate. You guys are going to be a great show. I can't wait to get into it. Let's bring Tony on the show. Hi Tony Welcome to the show. Thank you guys excited to be here. Tony Thank you so much for joining us man. Hey really excited to get into your show was reading a little bit about your bio and all that fun stuff. I think we have a ton of information to cover. So let's just dive in man. Tell us a little bit about yourself. First of all when I'm not working in real estate a family man I So I'm engaged to my high school sweetheart married this year and our Capo San Lucas Malvo. Twelve year old son. So you know when I'm not doing real estate thing that's hiccup. It's out of my time and I know we'll get into it later. But they're big part of the reason why I'm driving so hard for this when I'm out with them at work. I gotTA WC job. I work in supply chain for An Automotive Automotive Company Ask Us from doing folks. No real sir. Good that's awesome. What is your portfolio? Look like now Tony. I mean what what what are you have and kind of give us a thirty thousand fifty. Well of gotTa sure To single family homes both in Shreveport Louisiana. I live in seven California so it's a few states away but I'm really focusing now on trying to go to the large multifamily space so that was kind of my goal. Early on was to get into larger Apartment complexes but too afraid to start their wanted to kind of pick up. Something smaller I so I kind of cut my teeth on the single family houses down now trying to level up a little bit so an estate investor interest tank one. So what made you decide to do that? Living in California. It's almost mandatory right for someone's trying to get started the numbers. Just don't make a whole ton of sense especially in single family space so I knew I needed to go somewhere where my dollar was such a little bit further and my parents my mom and my Stepdad. They actually retired to this little town in Louisiana called Shreveport and they bought a house out there for thirty thousand dollars it had been vacant for a few years The put another thirty thousand into it for the Rehab. And the House appraised for about one hundred thousand dollars on Fallon and they've funded one hundred percent of the purchasing the Rehab with the local bank out there as once. I saw that I was like okay. Well here's here's starting. This is where I'm going with that that's right. That's amazing that's interesting and I can't wait to get into that. 'cause I want to hear more about the two properties out of state? I mean those are your first. That's wild it's going to be a great story before we get into that though earlier. You said they are my y you. Let's dig into that a little bit. your family's your. Y So we'd love to hear that story man what's going on here absolutely and so you know. I'm unlike most parents I kinda had I. I got started parenting early. I was sixteen when my son was born so I was a junior in high school and you know becoming apparent at that age at any age but obviously at that age it really has a big impact on kind of how the rest of your life flows so unlike most kids when they're in college and they're kind of partying and doing the thing like I always had this very clear focus and goal there driving me right in and it was my son. Who is my family? So it athletic. It helped me develop a certain level of grit and determination. I think a lot of people don't get until later in life and in it's it's Kinda pay dividends but having my family there and knowing that I wanna be able to drop my son off at school and pick them up and no fiance and I want to go out and and We don't have to worry about. Pto or time or anything like that so really. What's driving me? Just being able to spend time with them. He present for them and make sure the financially. We're always take care of interesting. And if if I can dig into that a little bit more. What helped you choose real estate as that avenue rather than every anything else. Right like what? Why why did you pick real estate versus starting a business or doing anything else? Yeah I will say that. I've I've tried things right. He wasn't a wasn't the first name man like in college. I actually had like a tutoring business. Right where a mobile tutoring business where? I had like three or four other tutors working for me. I've tried. I've tried so many different things right but my dad is actually the guy that that I can get the credit for giving me the real estate bug. When I was in high school. He made me read Richdad Board at and it always kind of stuck with me and I knew that at some point I wanted to get into real estate right just because it's such a such a strong vehicle but if we take that back when we look at what's going on in the market right now with the the corona virus right the stock market's going rat. Stock prices are plummeting all over the place with the companies are doing and their performance in any different than before current. A bias right. There's not a lot of influence. You can have as an investor in the stock market so the lack of control kind of pulled me away from the stock market but when I look at real estate I know that if I buy right and I invested my money into this property smartly that I'm going to get a certain level of return and I think that level of control knowing that I'm the person that the dictates how successful this investment is. That's what really pulled me into real estate. Great Answer Great Answer. That's solid advice for anyone who is in the same situation. They need to listen to that part. Just because it like. You said it's something that you have control over and you're able to help you can control that for your family and resonates with me. I have a two year old so I know your sons probably a little older than that. Now I have a year old and real estate is giving me the freedom to be able to spend the time that I want with him and if I don't absolutely right the other thing is if say that I'm I'm great at my deputy job right and climb the corporate ladder and and I'm just killing it right. Come on I'm gone once I'm gone right. Pass that on to my family. Bright BUT WITH REAL ESTATE. I can build this empire I can. I can have this machine once. I'm gone I know that that's going to keep giving giving giving my family. And and that's that's a big piece form to gold love that they're so. Do you WanNa start telling us a little bit more about. So you found the Louisiana market and nine. Take us to the next stop. You're like okay. What my parents did. I wanted to do that. What did you do? Did you contact the realtor? How did that go you absolutely? So it kind of happened in two phases rats in my first rental properties I bought last year in two thousand nineteen but initially kind of started on this journey in twenty seventeen so I kind of started stopped backups. I'll I'll take you back to twenty seventeen really briefly. The first thing I did was connect with the bank right ahead. My parents told me. Hey who the heck gave. Amazing loan randomness this real. Can It happen again? So I reached that bank got in contact with them and this is a small regional bank by. This isn't being America. This isn't you know wells Fargo. This is Home Federal Bank in Shreveport and they have three branches out there right and you know for the listeners. That's that's like a golden spots. Be Right like if I have an issue with my loans. I don't call one eight hundred number. I text the VP of the mortgage division at this bank so anyway built out relation with her. I let her know what I was looking for. And she said Short. This is a loan program that we offer if you can and there are some requirements right like you have to rehab and the purchase needs to be at about seventy two percent of the are and she's like as long as you can do that. We'll find one hundred percent of it so once I had the you know kind of the guidelines in place. Let's go find the deal. Luckily the person at the bank had a good relationship with a realtor So she put me in contact shooter from people and I just kind of organ from there right now back in two thousand seventeen. When I first started actually found a deal it was great. It was a short sale. It was way way under price. It was wearing the price I submitted my offer the accepted. And then it's got a kind of work. Its way through the approvals and all that because it was short so long story short there was a miscommunication between the listing agent and my agent were the listing agent reached out to my agent supposedly said. Hey Bank is accepted. We need a response within twenty four hours my agency. He never got communication out of losing. The property goes to auction. Wow Yeah so I was. I was I was super steal my first deal right. I'm like I'm like this close right. I'm taking a break right and I led about two years. Go by and you know how some things going on personal life. I and by my personal residence in California under getting engaged. So there's all these other things happening and then again. Last year I kind of things have settled down a little bit like okay. I think I think now time for me to get started with respect that same bank I say. Hey It's me again. Remember me look still have that. Same Loan Program I connect with the new realtor. And I I'm really just kinda hitting the ground running and I think the fact that I lost deal early on it kind of showed me that. Hey you're every is not going to go right from the beginning rabbit but you can't let it discouraged so I think I went in with a different perspective and I really narrowed in one specific zip code. I think before I was just kind of all over the place and you know trying to find anything but I said Hey. Let me let me focus on this one zip code and evaluate doing that that I knew like the back of my hand right I. I knew I knew what you know. What the properties look like what they were for a new like the approximate Rehab but. I should be doing so. I really doubt in on one specific. Zip Code everyone listening to that tip because that can be so important you zone in on one market and do your research and know that market. It's like people are looking at you know five different cities in different states. And oh I you know. I'm looking at these ones right now. Hold on one. Do Your Market Study of not going to work. Then go on to the next one but when you look at all these different places like you said you're not gonNA know at like the back of your hand and that's definitely going to help you when you run your numbers you're going to be able to do deal analysis faster and because I don't know about Louisiana but for me at least when I want to put an offer in pretty much has to be that day and I don't have time to go and do a lot of research once I find the deal and to piggyback off of that. Actually all my runner properties are within five miles of each other. All because I know that area like the back of my hand so the moment something comes to dinner to mark in that within that little circle that I have. It's like automatic putting an offer but if you tell me like twenty minutes down the road I've known what you're talking. I'm like Nope I got I can. There's five hundred homes that I can buy within miles know buying them all so yeah just piggyback. That's exactly right and know your market. That's key in Tony. What made you pick that specific area code was it because it had a good school district. What were the specific things that you liked about that ZIP code? The that's a really good question so shreveport as a city right. It's the third biggest metro in Louisiana after New Orleans and Baton Rouge. It's you know it's not a big market but it's not a small town either and I say that because it was different pockets in that city where you can go to some pockets. Where there's you know there's gang violence and prostitution and there's no all the things that come with like a war zone neighborhood on there's others that are working class. What I wanted to do was trying to find that sweet spot right. Like where's where's the or. Is it good kind of blue collar working neighborhood where the prices are competitive right under that? I can turn a profit but I also don't want to be in a neighborhood where it's going to be very management insensitive policy of of tenant. Maybe as isn't quite there and I also wanted to make sure because I was out of state that I was investing in an area where the property managers would be able to support it right so I'd reach out to a bunch of property managers and I chose the one that I wanted so as I was kind of narrowed down on my market. I I asked him. I was like invest in urge you manage in this area and he said no art. I'm what about this area? So it was kind of a a working relationship with him and he can pointed me in the right direction. Say for you. You know Tony. I'm starting to see a trend and we haven't even got to the deal that we're going to talk about it but I'm starting to see a trend almost like in your life since back when you were sixteen where you had a baby early in your life but you overcame that in a positive way and then you lost your first deal in real estate and now it seems like you've overcome that in a positive way so it seems to be like there's some grit in your life and I think that's why you're probably going to be very successful. Because you're overcoming these obstacles and as rookie investors that are listening to the show. Hone in on that. Take Take Pride in. Hey it's okay to make a mistake. Let's get through that right. Let's get past that you lost your deal. You took ownership let's go. Let's get the very next property and you're making it works. I see that success in your life because you have that. I'm going to do this for my family mentality right. What's that I know? There's a quote. There's somewhere where it's like if you do it for yourself. You're going to fail but if you find a why you're going to succeed so you just find your y. And if I can add onto that fluky I'm a big mindset guy right like you know the the real estate piece right. It's like twenty percent mechanics. Eighty percent mentality right so I'm super big piece and I can't remember where I heard. That might have been branding turnaround. I know someone set this. But it's like people have a tendency to get to give up when things get hard right. They just want to give up. And someone that someone phrase it as. How many chances do you give a baby to walk before you give up there? There's no upper limit. Ride the baby falls you pick them back up and you hold the figure it out and I've I've just really tried to hold that cinnamon salad with everything that I do. It's like I know for certain I'm going to fail at some point and that's totally okay. Because of failure where I learned the fares were I get better. And that's the whole purpose of that. I deal specifically is to learn so I went into it with that. Mindset the power of failing. But I'll tell you what it's GonNa make you a better investor too because uh absolutely absolutely right and you know you guys. I'm sure know this as well right but the first deal I have podcast and I've interviewed dozens of people in not one person that I met or that I've interviewed has gotten rich up. I do not a single person right. That's not the purpose. The purpose of that first year. The purpose of that I you as an investor is to learn is to educate yourself is to give you the foundation to continue building business that first property hits different man. It's a learning experience that I remember my first property and I still use some of the tactics that I learned from it going forward. So that's a great story Tony by the way. Let's move onto the next section Tony. Let's figure out and let's talk about a deal and let's dive deep into that. Do you have one in mind. Yeah absolutely about that. I because it's a great one awesome. So let's talk about that. One gives us the rundown how you found it financed it. Get THE NITTY-GRITTY OUT. Get the details. You know our listeners are GonNa want absolutely so in terms of finding the deal. It was on the the market that I mean. It's not a super heavy like investor market. There's a lot of good deal. Mls out there so found on the MLS sold my my rotator put in an offer and they accepted pretty quickly. I bought the property for one hundred thousand dollars. Budget fifty thousand dollars for the Rehab took about three months for three and a half months or so And Right now. It's currently rented for fourteen fifty. How did you find your contractors for the Doing? You know a big rehab like that. It was all relationship-building like I knew. Be Not a state that I was going to be able to manage that in any capacity and my realtor and my bank both suggested and referred the same contract so the fact that it's coming from two different people there. There's gotta be something good they're so referrals. Yeah fear because you're out of state and hiring a certain beano professional do the worker just because everyone was pointing to that person. And how did you get over that home? Was there any fear I mean? I think there's always a little bit of fear who I find that first rental property but the way that I frame it is I work in supply. Chain my wt job. I know nothing construction so I'm not going to be able to provide a ton of value. Unify was there. If I was in that same I can't provide it's own about you so the fact that I can surround myself with people that you this for a living I mean I. It took away a lot of after because he had this guy's a professional what he does every single day. And this is a learning experience for me so I can learn from him and figure out how to do this. You know the next time. That is a great point. I I liked. That is even if you were there. You wouldn't add much value anyways because you know you wouldn't be. You could stop maybe at the property and see how the Rehab is going but now or property managers. They'll go and do the video. Walk throughs for you. So you don't need to be there. But they're swing a hammer. Tamp facetime the contractor in economy. Show me around every couple of weeks just updated and then that was good for me was the what was the outcome of that property whereas at now. How's it doing? Yeah so there's actually a story behind that right so we purchased the property and I want to say it's a couple of weeks ago. Rehab started because the contractor is working on another another project so it took about three and a half to get the rehab finish now when I initially underwrote the property. Underwriting the deal I had fifteen hundred dollars per month is the the rent that I was started by after like I could confidently get this number. And how did you find that number just looking at the market right up? I was kind of looking around and said this. This seems like a good number based on rentals that are comparable to what what it is is. That were listed on different websites. Okay so you know looking at Zillow and I was like zillow feed right like I was just on Zillow's every single day just you know what's the rental market Sa- Fifteen hundred dollars was my number and wants the Rehab finished. We pass the keys over from the contractor to the property manager and I said Hey. I'm thinking of listening at fifteen hundred dollars where your thoughts and they said we think we can go higher. We think we can sixteen hundred dollars. So I'm like okay. You know these guys are the experts you know. They know the market better than I do. Let's listen sixteen hundred dollars so we listed on six for two weeks and nothing and sits Acid Hey I'm freaking out a little bit right of weeks. Now happen so we drop down to a fifteen. Seventy five weeks goes by nothing. I'm going I think were little so it ends up going for. I wanted to say was eight weeks that the property sat on the market. Now guess what we we dropped from sixteen hundred to fifteen seventy five to fifteen fifty to fifteen hundred and Annette finding in rented at fourteen fifty now. The the lesson that I learned from that is the property managers. There are the experts and I definitely WANNA lean on their expertise but I knew my heart could fifteen hundred dollars was the number but I still leaned on them at at the sixteen hundred. I think had just stuck with my good. Initially it went a sat. As long as there's a there's a big lesson Martin bear from me as well. You know. I've I've had that feeling before as well and I feel like I can't remember a time where listening to someone else versus my gut. When the right way listening to that that that spirit feeling if you will has always yielded me the best return and I can almost say that if you left it at that original number that fifteen hundred you probably would've got fifteen hundred right sitting on the market. I bet people are like he's GonNa keep going down so much wrong with you know so and that's an important lesson right there that even though you were a brand new investor it doesn't mean that you're wrong or you don't know movies people. The property managers. Yes they have experienced but sometimes just have to trust your gut and like you said you did your market research. You looked at. Those comparable runs a property manager. Sorry the real quick there also incentivized to have a higher right ops the. Im too but they're not as negatively impacted by vacancy right. But for me that means I had to make another mortgage payment where the property were sitting empty right. So there's some give and take there for sure. Let's talk a little bit about the Rehab. How did that go? Was it smooth sailing? Did you hit all your numbers all your timelines. But did you just crush the job? Was it the. That's not how it went. There is some good things that I learned. There was in bad things that happen as well. I think the the biggest thing that I learned are. Let me take a step back. The biggest problem was that there was. There was lack of clarity on what the Rehab was going to cost. Okay so again I. I didn't spend any money out of pocket for the Rehab Right at the the bank. Funded one hundred percent of that. But as I was working with the bank trying to get the funding secured we'd given them multiple bids on on the Rehab portion where we had one bid at forty thousand and we got a second bit of fifty thousand and you know that was me working with the contractor and figure out what we wanted to do. I was under the impression the WH when we entered into the into the loan that we were operating under the forty thousand dollar bid once we get to the end of the end of the loan right and and the Rehab is done. I realize that had gone up to the fifty thousand dollar bit and this is without me realizing that right so confusing right so the the that the loan payouts work is that I. I'm not involved at all right. All the contractor has to do is go to go to the bank and show them. Hey here's the work that I did. And then they get their their withdrawal construction loan when you build a new house. They get their draws okay right but I wasn't involved in the draw process all right so the bid that I saw. I thought that the work was being done was gonNA was only going to be forty thousand and fifty thousand dollars so that was a that was learning experience from either there needs to be some clarity in a tattered communication between me the contractor and the bank about. Hey which bitter we actually going to use because you know the goal is to refinance its property but now I'm ten thousand dollars higher than what? I was arguing for us though. I was something something that I learned but some other issues that we saw with Rehab was that it took longer than expected right. And that's never I investors problem. I think the first thing that I would have done is I would oppress the contractor to get started sooner. Rather property sat empty for a few weeks while he was finishing up some of their job and it would have been like. Hey we you know I. I can't sit that long next time. I gotTA start as soon as I get the keys. That was a inform us. Well outside of those two things. There weren't any other really really big issues for me interesting. Tony because the the ten thousand dollars over is new to me. So I've here in Tennessee. The investor and the contractor have to sign off for him to go get it withdrawal. It's not like he can just go drawl without my consent. So That's interesting. I didn't know that that that that wasn't allowed. I wonder what regulations are there to stop them from just going and getting more. Draw without your permission. I mean that seems really open. They're still the so the way that it's structured is the bank says. Here's the money for the purchase right in. That's that's cut on day one. And then here's the money leftover four delone. Right on the loan got funded. I was under the I was under the assumption of that there were some cushioning therefore contingencies and things like that but they had the number was so high because that was actually with the whole bid was so there's no sign off on the loan or anything for the contract get their withdrawal because I sign all those doctrines at the beginning. Was there a limit on how much he could withdrawal? There was. Yeah there was. There was an upper limit. They're trying to get to that so so there are some lessons. I think honestly wasn't him trying to be manipulative and anyway there is there? Is this honestly? He thought this is the associate working under so really on me for not not driving that impudence Tony. Can you just explain to everyone what a draw is like? How does that work with the financing? You're getting yeah absolutely so the bank has a copy of the bid contractor. Gave me right in all the work that he's supposed to be doing and it's kind of broken up into sections. I WANNA before draws for this specific loan so the contractor Reduced Fourth of the bid. They go to the bank and say. Here's the work that I did. The banks some send someone out to kind of review that everything's good and they get their draw and then it just keeps working that winds. They've completed job okay. So it's kind of like a line of credit. The bank has this money set up for you and then the contractor will go and you know. They did ten thousand dollars worth of work. They'll take that draw the money and then until the project is done and they've drawn out the full amount of the rehab cost. Is that correct? Okay Cool Tony. How would you do that? That specific part differently for our listeners. What is the nugget that you took from that? And what have you implemented going forward? Yeah so I think the first thing is making sure that no draws happened without my knowledge right I I can be tied into that process. Everything's how it's supposed to be and then the second thing is like it's totally on me right because the fact that I was facetime in the contractor and seeing the work that was being done and it never clicked to me like. Hey this is more than what I thought it was going to be right. It's because I didn't. I didn't take enough time to really dive that bid to no you know no backwards and forth and say. Here's what's supposed to be done so I really make sure now that I've got a really solid understanding of that bid and what were agreeing on to make sure that as checking that everything's lining up but like Flea Bay I. I was just so excited to get that I was like let's go. Let's go let's go. I didn't I didn't even really take the time to to pay close attention everyday. Do you do you care to show or to share the numbers after you re. Did you refi out what you wanted? Did it work out for you in the end? Yeah so it was a construction loan and they had like a really tight timeline on it. I think I could only have that construction on for like four months so as soon as a construction finished. I refinance do a permanent loan. I didn't pull any cash out. Just left it just straight to pay off the construction loan but my plan is to refinance and try and pull some equity out Six months from now so. You did that with the same bank that you did. The construction loan the purchase Rehab with and then once that loan is done it's completed you just rolled it over to the with the bank. Okay you're one of the things that that I do in another show isn't about me but let me let me give you some where the vice that I do with my because I pride myself on how well I handle my contractors. One of the things that I do is while we're doing the walkthrough and they're giving me scope of work. We identify where thirty three and a third percent of the job is and once he reaches that scale he can do a draw so now. I don't actually have to go to the bank when he wants to do a draw but my bank knows that at this point. Let's say drywall up. Everything's muttered and sanded. That's thirty three to thirty can go receive that amount of right so we structure that prior to even signing a contract. It's like hey but these are the three times. You'RE GONNA get paid. There's no advances. There's no material advance. There's none of this. You get paid after thirty three and a third percent of the job is done and then I will see basically at the very end I get pictures every now and then I go down to the job. But that way there's a structure in place right. God I love that. I'm I I got. Ask about toolkit man. That's a good one. That has been a very common question and our facebook group is how to handle contractors during Rehab so. I'm glad you jumped into that. Fleet Bay no you absolutely and then Tony. I'm assuming now you have it rented out. It's doing great Kinda give us what's what's going on with it live today. Yeah yeah so I have a military family in. They're actually signing a two year lease and I was a little hesitant assignments you at least at first because I was like that kind of limits my ability to to raise the rents but it kind of comes back to knowing your market by Shreveport is not really an appreciating a or a or quickly appreciating market right. Rinse don't move up like in California when I was renting a minute. We'll go up like fifty dollars every year right and shreveport. It'll stay flat right so I was talking with the property manager said. Hey you're probably not going to see a big bump even if you only have one you're Lisa if you can lock them in for two years. It makes more sense for you so ray family. They're in the military you know. They're they're really good people so it's going pretty well right now for a two year lease did you give them a discount at all or it's just the flat rate for both two years. No Yup decrease if the whole two years eight asked for it but I said hey marty kind of coming down for what I was targeting Santa Bozo. It worked for both of us. I love this kind of properties. Actually Tony I love the idea of just flat not sexy cash flow every single month like to me. That's safe right two years. Guaranteed if I could get two year leases on every single one of my properties. I'd be in Bora Bora weeks. It's it's not having to worry about getting new tenants gut feeling that you had where you're like. Oh my gosh. I don't have tenants for three months. That affects your cash. Affects your bottom line. And that's the biggest biggest expense right is the vacancy. So if you can do anything to minimize that it's eliminated than than a mix ten cents and Tony. I don't know if you set already. What kind of house is this? A single family. How many bedrooms bathrooms are just dove right in? I love the numbers by a single family. Home it's A. It's a three bedroom two bath. This was it was built like a nineteen fifty something and You know a lady had owned it passed away. Unfortunately so her her kids. It inherited the home. It had not been up dated since the home was built. There is light pink tile and like this really weird carpet and it was it. Was you know exactly what you think of? Nineteen fifty. Sarah. You know we. We went and we pretty much got at the whole House. Or it's it's beautiful now. We have three bedrooms two baths grade neighborhood okay. So now that you've got the people in there I just want to like go over the numbers again and put it all together so your your purchase price was one hundred thousand. Your Rehab was fifty thousand and then did it appraised for two hundred and thirty thousand dollars. Yeah Okay Urn for your rent was thirteen fifty or fourteen fifty fourteen fifty. Okay and so. What's your cash? Well that's what we all want to know. I didn't want to be the one to ask the mortgage payment With with with taxes and everything. It's about eight hundred dollars. That's the guy and then since the since the house is is pretty much brand new. I'm buzzing a little bit for maintenance but I'm sure I wouldn't put a whole lot in too because you know it's all new and then at the property. Management is another one hundred dollars a month. So I'm conservatively saying about dollars in cash flow but is probably a little bit more. Because I won't be as much set aside for expenses now for property management. Is that a flat fee. Or a percentage you're paying the percentage but they cap it at one hundred dollars okay so it actually works out really well so yeah. It's a flat one hundred dollars for this property. So as you add more properties are you going to negotiate with them to say. Hey I'm going to plan on bringing you guys X. amount of doors. Can we negotiate that price? Everything's negotiable and year. That's the goal. They're they're really solid company And I told him when I met them. So I flew out there to Louisiana and when when I met them in person I said. Hey this is the first property but this it's the first of many right and this is the goal here is. We have a long-term growing relationship and I set that tone from Philippi had to say. Hey It's not the one house but it's you know twentieth fifty and there were open to you that start building that relationship. Yeah that's that's exactly right you you keep that open line of communication you express your goals to them and it even keeps you accountable right to like. I need to get more property. Some telling people that that's what I'm GonNa do so it kind of keeps you going right for our listeners. There Tony can you give us a an explanation of how if I bought you coffee and I said Hey tony when by coffee man. Can you give me four five steps to get a property just like yours? How would you explain that I could they do that here? That is a great question. I think the first thing I would say is don't over think right but like that's the thing that gets people caught up as they get stuck in this analysis paralysis where they want to hit all these specific numbers. And everything's gotTa lineup perfectly. But it's never going to happen that way right at least in the first year. I haven't met anyone that at the perfect I e something always goes a little rock break so I think that's the first thing I would say is don't over. Think it expect to make some mistakes right at the mindset is where you gotta start. I expect to make some mistakes and from there. It's really just finding market that you're comfortable and start building your team really get to know that market intimately and then start putting in offers right but it's really really that simple thing that are always say is that real estate is not a complicated business. It really is like the actual steps. That people need to take the clothes in that I feel is. It's not all that hard. Not all that complicated but what it isn't is that it isn't easy right. It is hard it does take a lot of work to do those things but the actual substantive they're not that complicated a Philippi I'd say get your mindset right. I right going to go into the right perspective. Then find your market build your team and get the deal so now you got your first party there you know that market and you have to properties correct so you bought your second property now. What's what's the goal for the future. What does that look like? Are you saying you know one a month or so? I actually bought those two wide relatively close to each other so I wanted to kind of get those both finish before to the next one. I'm going to continue investing in Shreveport on the single family side just because the Lome Product is so attractive right like I want milk that as much as I can but when I started investing real estate I knew that my goal was to get into larger multifamily complexes I read a book by Joe. Fareless a camera with that was gone. It was like the best apartments indication book and he said before you can. Invest are successfully invest in apartments. You need a track record right and Mike. I didn't have one but I didn't have never bought anything before so I said Hey. Let me start building that track record. Let me get a few single family homes. Just kind of you know build my knowledge and build my credibility And then from there I'll scale up so a medical right. Now keep keep kind of milking the cash cow that I have easy and our bird Scale up to your start binds properties. That's interesting because for me Tony I. I just stuck too boring normal. I just like the process that you about one and then to. I just didn't stop. I just going just about seven and then number eight okay. This six hundred dollars. A month seems nice. I'm just going to keep doing this boring just like you said. I think people overcomplicate real estate. Sometimes they like get into this analysis paralysis and I knew business cars I need. Llc's and I need the right lawyer. And I need my team and then three years went by and you didn't do anything and the prices are twice as high if you would have just bought a rental property figured it out. It's GonNa be OK guys. It's okay to get a lot of these things in place you know it's important but there's nothing more important than buying that property like get involved getting the game right and that's the biggest thing that just get off the sidelines. Right and everything else will work itself in. You know it'll work itself out exactly. Yeah I loved your story about how you did this deal and I you're giving such great mindset tips to and I mean it seems like you're everything you've learned and everything is part of. It is adding so much value to you but I wanNA know. Is there a specific person? That has really been a key player in getting you this I deal and we call this segment the MVP MVP man a key person. Gosh let me think on that right there. There's so many different people that I interacted with to to actually get that I deal done but I would probably say my dad right in him giving me that. Rich Dad Poor Dad book back when I was like you know fifteen fourteen years old because that's what planet to see the that's planted the seed for me right and I think had I not read that book as a teenager. I never would have found bigger pockets and I never would have found all these other resources that helped me get that. I deal so everyone else was only in my life because of that decision that my dad is a preacher Marilyn and how soon is it going to be before your son gets that gift that book? I guess I very so. I haven't given him the book yet but we play the cash flow game so we concepts. Yeah so he loves it. Sounded this stuff for you guys in the show notes and bigger pockets dot com forward slash Ricky Tan but yeah that will link the cash flow game and the Rich Dad. Poor Dad book because those are great resources. And it's a very. Have you listened to other real estate podcasts? Were they ask like Brandon? David's PODCASTS. They ask. What's your favorite book? Rich Dad Poor Dad is a very common answer. The the reason why people got started her thought about real estate McClure Lurie. Okay so we hear that answer all the time rich down Florida what was your biggest takeaway from rich. That for your money should be working harder than you all the time right. Money is the absolute best employees that you can have and smart. Wealthy people have found a way to put their money to work right whereas the average American they work they spend all their money on liabilities. Were as rich people they work. They spend all their money on assets which which increase their cash. La Okay Great. I want to ask real quick to about so the bank that you're using would Alone officer you'd be a good. Mvp for someone Going forward because you've I thought you were GonNa say something about the bank going because you know they really did have such agree package for you and it seems like it's going well if you keep working with them do you think a loan officer could be someone's MVP. Absolutely right. And I think for people that are in the single family space going to Bank of America doesn't make a whole ton of sense investor. I would honestly I would rather have a relationship wreck. Call that person and have a real dialogue and they know me and I know their kids and they know my family right like that relationship is so much more valuable. Yeah I I read as a new investor. Someone who's trying to get started building a relationship with that small regional bank is critical. I agree I I know my loan officer pretty well in. I love that we can have honest and real conversations where she come in. She gives me a hug. I mean I know her personally and I get to shout out to Regina here at Franklin paint in Nashville. She is amazing busy. Take that part of you know. It's great relationship building. I didn't know the importance of that until I got started in real estate. And how crucial that was to to not always look for. What can I get out of a person? But what value can I add to them? And that's GonNa keep me in their mind at all times especially when when I do need something right. Don't just reach out to people when you need something. Add value to them and then when you are in need of some help you know they're gonna be like man this per. I want to give back to this person. Person has been great for me. Yeah and if I can add ons about like for people that want invest out of state fly out there. You have to go meet people in person. It's one thing to exchange emails and phone calls but it's actually garage like you said that To share a hug writer to to share a meal like those are the things that really allow you to build that connection build our relationship so that as you further that relationship you guys have a really really solid foundation. Okay so I'm GonNa make you. Mvp of this show now. We call this the rookie request line and you are going to answer a question for a rookie. So if anyone would like to call in any time you can call one eight eight eight five rookie and leave a voicemail for us and just ask a question and we might play it on an episode so this week we have a question from hi. My name is John. I'm from Buffalo New York and I'm looking to invest out of state and I wanted to know what is the best way to get boots on the ground in that area? Do I heard a realtor. A property management company or trying to find a local investor in that area. Thanks bye. That's a great question. I think if you have someone that's family writer. That's you know that you have a personal relationship with. That's a great place to start and assume that they're interested in real estate. You can work something out but if not I mean. Yeah all those who that they listed right. The the property managers is huge. The realtor is huge discard. There are building those relationships because all of those people are willing to work with you and kind of be part of your team. Even though we're paying them they can still be part of your team right. I think sometimes you forget that when I think about building their team they think about goose on the ground is someone that they have a relationship with your property manager. Realtor can play that role as well. Okay Yeah Great and actually. We've loved the advice that you have that we are giving you two questions a little bonus round here. Perfect hi there. Rookie World My name is Tony. I'm having a dilemma. Currently I have a job. It don't really love but I mean these money don't necessarily see myself there forever anyway. If I were to quit how can I use that time but still also get lending? My wife has a job also we could use her income but we really really want to just be able to do it. Current name and my name if we were to do it on on our on our own man. That's a that's a heavy question I mean for me. I don't think that I'm going to try to answer from from my perspective. I don't think that I would quit my job or I think at that point. You put a little bit too much pressure on yourself to start generating income and I think that pressure can lead to poor business decisions. I think the thing I would do is use that fuel of me. Not Enjoying my job to drive to work even harder. My real estate business. I think I would challenge Tony on the the fact that he doesn't have time right like you know. I have a w job right and I have an organization of over five hundred people that I lead spread out across the nation. I'm working non-stop Abba family. I have my own podcast. Put out three episodes a week. I'm investing in real so I think I would challenge his notion that he doesn't have enough time right like Tony. How much how much TV are you watching right? How much time would you do? Instagram and facebook. So you know we. We all have the same twenty four hours right away. Musk's running like four different companies right now and he still finds a way to to to get it all done right so. I think we can do that so tony. My advice to you is find a way to to manage your time a little bit better to dedicate your time a little bit better And just use that. Fueled that you're not enjoying your job to really driving takes a massive action. I love that answer because I get that question all the time as well. It's like I don't have. I don't have the time to do it. You know or you know. Should I quit my W. Two job to to do that and usually I or they say they hate their. Wt Job. And I always tell them. I'm like if you hate your W. Two job. It's because you don't have a reason to be there when you when you find out how much you can leverage your W. Two jobs from the bank to get more loans to get more properties you all of a sudden really start liking your W. Two job if you really love you're GonNa Leverage that that. Wd Job towards real estate near infiltrate. Fuck out onto that. You know interview guests on my show where you know yet. Maybe they weren't happening there two job so they wouldn't found a job that was related to real estate right. It's became construction company or they became a realtor right or they became a property manager. So there's ways that you can shift your w job to support your real estate goals as well great. I have to agree with that because that's what I did. I didn't know that I wanted to go real estate path but I was working at an accounting firm hated. It quit and started working as a property manager and that's gotten to real estate and on bigger pockets on the forums. They started talking with Was probably six or eight months ago. This guy in his twenties and just saying he wanted to get into real estate and he was ready to take massive action so he quit his. You don't steady w job at a big public accounting firm and went and worked as an accountant foreign investor and I actually got to meet them for the first time last night and he has a duplex and looking for more deals. And here's this really exciting to see that. He did it without quitting his job. And it's a lot easier to get bank financing. When you have that W two income coming in but how you said the time blocking and not everyone has everyone. Everyone has the same twenty four hours in a day than that is so great. I started on a construction site and you know hated every minute of it until I started seeing. How could leverage that towards real estate? I figured I was like man. I don't have any connections in real estate though. All I know is drywall. Construction guys electricians and flooring installers and then you know investors was like dude. Are you an idiot? That's exactly what you need like. You know? These people like you understand. You speak their language. Here's the money like we're having trouble finding contractors and you're having lunch with them every single day and I was like. Oh my gosh it is as you said earlier mindset mindset and what are you leveraging the people around you absolutely can add onto that right because you mentioned network and I know that a lot of people that are are looking to get started in real estate. They filled that they might be doing this on an island where they're not surrounded. Don't know people who are investing or they don't know people that are that are successfully doing this. That's totally okay. Most people start that way but you have to be diligent and going out there and building that network right go to meet UPS Get on bigger pockets. Go to conferences. I love real estate conferences. So some of the best experiences I've ever had been in a room with hundreds of other people that also talking about real estate right so go out there to start meeting people in. You'll be so like positively overwhelmed with the amount of support you get from those those kind of relationships pockets coming absolutely so excited her. Tony Tony Definitely GonNa let I'm excited. I'm excited about the food. I can't wait to go of that. You can find out more information of bigger pockets DOT COM forward slash conference twenty twenty. Did you find the link with all the Info there and you can meet Tony Birthright coming out with this guys. It'd be super all right Tony. So let's wrap this up a little bit We do have a couple of fun questions that we'd like to ask you We ask all our guests these towards the end this something. You ready for you excited. Yeah absolutely let's get into okay. Awesome so my first question is what's the highest high that you've experienced in real estate so far who behind high. I think it was the first time I saw the money. Come in like that. First Payment And I've got to set up with my with my property. Managers like this electric playmate. So you know. I emailed the that the direct deposit hit and like man like this is. This is actually a thing you know it was nice to get paid versus going the other way around right right one coming in. Yeah Nancy not sure. That was my with my son with my fiance said. Hey you know here. Here's what all the hard work is coming out. So what is your favorite APP or online tool or even piece of technology that you can't live without who online tool or piece of technology that's a good one. You know what I would say. I would say bigger pockets honestly and this isn't just because I'm on the podcast. I mean I. It's really is a great resource. You know. I've I've I've connected with so many different people on their Both online and in person. And it's it's just been such a wealth of information for me and I think like so many new investors like bats. You Re Rich Dad poor dad then you go and Google real estate and you find bigger pockets right and then you can go down this this you know this whole as Henrietta and the third for me so I think bigger pockets has been been pretty critical for me. I think you know moving forward is my business starts to scale. I would probably say that my email right like I feel like I'm connecting with so many different investors and and you know scaling the multifamily spaces. It really is a team sports. He had to know a lot of different people. So I I think really just being on top email building. Wish is pretty big former right now to love that email. I don't think I've heard that one yet but I think sometimes we do forget the power of email and just you know reaching out to people. It's a great way to to communicate with somebody. You know quickly and answer questions so yeah email's great my next question would be. Tony aside from Brits that Boorda we always but I'm actually interested. I get this vibe from you that maybe you're a reader that you read a lot and do a lot of research. So what are your top three books aside from at that port at? What are your top books that you love books? The five love languages out is one of my apps absolutely nothing to do with business. It's nothing to do with real estate but all about relationships so that that's a big one for me who is the second one called crucial conversations. That book is again not a business book but its relationship book and anytime that you're dealing in like high pressure conversations. That's a book. That are always fall back on Thursday. That I really really enjoy is good to great. It's a it's a business book Jim Collins thing was the author but it talks about how these businesses that were during really good made the leap great owns. That one's a big one for me. No you said three but I'm GonNa give you give your fourth minutes because I I love this one you. It's called the multipliers. I can't remember who who the author is. But it's a book about how high level leaders bring out the genius and people that they're leading. Nfl like in business. In real estate you have to be able to find the jeans and other people and in lovers. That's that's the best ability it's been for me to multiply recommendations or I haven't heard of that one. I just looked it up. I think it's Liz wiseman on. That's the one. Yeah Okay I'M GONNA I'm GonNa add that one for sure to my notes here. Goes what question you got okay? So this question is a little bit of rookie hazing we WANNA know. What signing is your guilty pleasure song man? Can you sing a little bit of it for us? You know what I'm actually a big Taylor swift and I call it a whizzy Bro. Head compliments your voice. I Dunno I kinda got the baritone voice I know if any but Once on the goes who don't even remember the words feeling broke. Got Great stuff that again. Antonio where can people find out more about you bro? Yeah absolutely so. I've got a podcast. It's called the your first rules investment. Podcast you've got some go over to your first rules. Investment DOT COM for slash. Itunes straight there. Same thing trying to help people that are getting or they want to get started. The premise that shows I interview people just about their first deal wherever we go super super deep on that first. Yoga and outs drop. Does every Monday Wednesday and Friday on so people that they can go there or if you want to find out more about overdoing on the apartment investing side you can head over to Alpha Geek. Capital DOT COM. That's Alpha Geek capital my know super funny name but we figured it. Stand up you can learn more about. We're doing the multifamily side and like you said you're working full-time and still investing and you got going on to so yeah. I think our listeners would be a great for your show to come less than two. So everyone over and hit subscribe but We'll link everything in the show notes if you guys want to go to bigger pockets dot com forward slash rookie. Ten Will link all of the great value that Tony has provided us today. But thank you so much for hanging out with us today absolutely. I'm super thrilled to be here. Super glad the bigger pockets. Doing this and I know it's GonNa fool award in the marketplace. There's a lot of people that want to hear this content and lasting. If you guys want to reach out to me directly you can give me a call. She metex the numbers nine zero nine. Five eight seven seven five to four again always happy to connect with people in helping him so he can prank call. I'm GonNa put you on a craigslist poster. Something I'm Ashley on Instagram. At while from rentals and he's fully bay. Unscom at Fleet Bay May Area R. E. And don't forget to get active in our facebook group so just search real estate rookie and you'll be able to join our group but check it out and I'll guarantee you can learn something new. Thanks for joining us. Tony thanks for being on the show men. A true pleasure to honor loved what you're doing. Keep crushing it. Especially for kids brother appreciate it. Thank you over.