Unsophisticated and extremely profitable

0:04I would dare say I've probably made every real estate mistake in the book several times over but I dust myself up I pick myself up it keeps me humble and I try to learn from my mistakes and I keep on trucking along yeah just a quick update status wise I think through my investments and some love and just feeling fortunate I've been able to pay off my residence the house that I'm in now that first property is paid off and I've and I've paid off two subsequently two other properties so out of 12 properties I've paid all four including my my personal residence

0:53Nice so even though I am horrible at math I can realize hey I'm kind of getting ahead this is great I've got tangible assets that have real value and I've increased my net worth and these are generating income and I don't even have a silly loan to pay anymore which is great yeah yeah just I was just gonna say just just looking at that first one as an example I mean because because a lot of people the traditional retirement path is to work and save you know money but you you bought this house up front with a loan someone else's money since then it's created a quarter million dollars of value in the property

1:42And what what's the the rent B I know I know probably 20 years ago it was slightly different than it is today but what's the gross monthly rent then between what's the range I I think way back when if I had to guess my my note taking is horrible so I have no records but I would say when I initially turned it into a rental and I think my first tenant was some young mother and her her daughter I think they paid maybe just a smidgen under 700 a month for this tiny little house and now I have a five-year lease and I get just under $1,800 a month wow

2:31Okay so it's great and it's it's yeah and and it you know I I I never I I I could have never as a young 20-some thought projected what will where will I be in 20 years how how will this look will I even stick with this but looking back you know you could I I I think despite my lack of sophistication I've just come up with a model that works for me and I got through barriers like you know we we all hear about okay how many loans will a bank give you before they

3:19Say you know we we don't want to extend any more loans for you to buy investment properties well I I just made it a mission of mine to make hundreds of calls if necessary to small Banks to large Banks just saying hi I'm James I'd like to buy a rental property will you make a loan to me and so over the years if if if a lender said no James we we we won't we won't give you any kind of loan or mortgage I just wouldn't let that deter me MH and I realized hey if I can get a loan and put 20% down and project

4:08That this rental property should rent for x amount of dollars I I should have some some built-in cash flow every month and you know proceed yeah so I I if if and because I'm so unsophisticated I'm not buying these in the name of a LLC or S Corp or anything fancy like that if you pulled my credit report you'd see all these loans on there yeah in my name only so I just operate in a very unsophisticated unconventional manner I've gotten loans on all these properties and the good news is just recently the most recent it's so nice to get that piece of paper through the mail that says congratulations

4:58You you've satisfied this debt in whole and now I realize okay you know that cash flow and other available funds I can just I can just keep this momentum going and start whittling away at the next balance and you know maybe before too long I realize now I've got five out of 12 rental properties you know I own free and clear five out of 12 which seems like progress to me absolutely yeah and and I think people want to over complicate it they want to get super complex and and sophisticated and think that that is the path to success or progress or whatever they they want to call it

5:46And I've just noticed the exact opposite it's the people who keep it more simple tend to have the better results over especially over the long term and just to go back to the the the example one real quick for for people who are are young listening to this getting started thinking about how do I how do I set myself up for the future and make sure I'm set up again going back to that traditional route you could save a chunk of your income put that aside into a 401k or whatever into a retirement or compare that to this route that you you took with just the first property we're not talking about the other 11 at this point you created $250,000 of value then several hundred, if you could do the math just from the the income monthly income several hundred,

6:35over the last 20 years of income which paid off your mortgage some of it probably went to maintenance and other expenses as well taxes and insurance but you didn't have to save any of your work income to get to this place so you've got this pretty nice Nest Egg sitting there just from this first property over for 20 years and you compare that to how much you would have had to save for 20 years and invest to get to the same amount that you've accumulated through cash flow and equity on just the one property so it's when I think about the op you know the the different options that people have this is why I'm so huge on rental property if you're willing to to buy it and hold it for the long term not that this is the scenario for

7:23every property but it tends to work out this way as appreciation and you know the inflation that we're everyone's talking about so much does its thing it pushes up the value of everything including real estate and so you just sit on it for 20 years and you find yourself in a position where it's worth you know five times as much but that's that's amazing well I I think you I think you articulated that very succinctly and and perfectly and you know I a again real estate was something I could understand it and it was more tangible to me so a few years ago I had a modest

8:12Amount of money in a 401k plan through an employer participation plan and I did what others have done I liquidated that and used that to be my 20% down on on a on a purchase so I just I just realized hey as as incredible that the stock market and and those savings Vehicles can be I'm going to pursue real estate because it speaks to me it makes sense to me it's tangible and so I liquidated those funds and immediately put them to use in a property and and so yeah every time I've got

9:0120% down you know that's sometimes when I you know my wife and I will have a discussion hey could I could I go shopping is this a good time to just to see if there might be another property out there to add to our portfolio ah