Building Financial Freedom Through 20+ Real Estate Deals While Serving in the Military

0:00My parents split up when I was like 5 years old. So I grew up for most of the majority of my life as in a single mom household. So I didn't really have a dad around a whole lot. So something for me that's been really really important and it still is to this day is to be the dad that is present that is around that that isn't just heads down in the computer or the phone — and working you know from sun up to sun down like leaves the house before the kids get up and doesn't come back until like dinner time, right? Like I didn't want to be that dad. I wanted to be the dad that that is able to take them and pick them up from school, right?

0:35Is the one that can do the volunteer work in the middle of the day. And so that was a huge driver for me as well is just to be that present father figure in my kids' life. And again like that that passivity, the the income created from from real estate was that tool was that driver. — Yeah. I'm curious why you stayed in the military. You know, a lot of people wrestle with this decision of when is the right time to go all in on real estate, whether it's the military or corporate job.

1:07Like you got to like a lot of people are trying to decide that and wait too long or go too early. Like what's your advice on that? — I I I loved the leadership aspect of it. I loved the people aspect of it. And and honestly, I just I I stayed in until I like didn't have fun anymore. I I didn't have kids until a little bit later in in my Navy you know, time frame. So, fortunately, I didn't have to do any type of really long deployment with kids in the picture.

1:41I did some short stints, you know, some little debts, you know, three weeks, two weeks, little, you know, round the world trips, stuff like that. But I never had to do like the long 6 month, 9 month, 12-month deployment with kids. I think that would have been a different decision if that would have been the case. If I would have had kids earlier on in my Navy career, my decision could have been different. I'll say that right now. But, but for the most part, like I loved where we lived. I loved the mission. I loved the people. I loved leading sailors.

2:14I loved helping. I loved having conversations beyond just like the Navy mission. I mean, I was like I was the exo in our command that like everyone came to for financial advice, marriage advice, kids advice, life advice, right? And I loved being that. I loved being that leader who could be open to having conversations outside of just the Navy mission. And so, yeah, man, I I loved it. I mean, I'd say as I got closer to the end of my career, I, you know, as my kids were getting older and I wanted to be around more, I, you know, that was like, all right, 20 and I'm done to the day.

2:50I needed to move on and and kind of get, you know, the the real estate stuff going even more so and and be present for my kids. So, I mean, to answer your question, I just I really just liked it. — Yeah. Yeah. Well, I think that's there's a lot to be said about that, too. You know, everyone kind of envisions I think well if I just leave everything's going to be rainbows and sunshine and you know this nineto-5 is what's killing me and sometimes it's you know you need that purpose and and you enjoy it. So — I and you — I loved where I I mean I was in San Diego for 10 years.

3:22— We lived in Naples, Italy for 3 years. I and then I was in Denver, Colorado for three years and I did a stint in Fort Worth, Texas for 3 years where you know my my whole family is. So, like the duty stations were great. The jobs were great. I had like good people underneath me and above me for the most part. So, like I Yeah, I couldn't complain. I had a good career. — Yeah. And it it obviously paid off for you financially too when you left the military. And it kind of ties into your earlier point too about you know how you managed both. You know, you said a lot of guys are going out and just getting hammered on the weekends and then, you know, don't have the capacity to do this.

3:59And I I heard a quote recently someone said it's not it's not about like what you're willing to do to get the results, it's what you're willing to give up to get the results. And that's much more important. And and so I think like what you're describing resonates with that, you know, like you you stayed in and and did the things that you loved doing and also were were intentional about the things that you know weren't leading to your success and and you set yourself up to where at 20 years you were in a really good position and financially free and didn't have to worry about trying to get out and get a second job.

4:35So — man, I mean h just awesome setting those habits, right? Setting those habits and those systems and processes. I I like — I can't get out of the habit of waking up early. Like I still to this day, you know, I've been retired since 22 — and I still wake up between 4 and 5 a.m. Every single morning. — And that's natural now just because that's what I was doing for so long. Like I would get up early in the morning and I'd go to work on our real estate, you know, jobs, our real estate deals. And I'd work from like 4:00 a.m. To you know 6:30 7 o'clock until I had to go to my Navy job.

5:09And and I still do that today, right? I I still wake up between 4 and 5. And now like I'm not as much working on my my real estate stuff. Now I'm, you know, getting in the Bible and doing some prayer and some some quiet time and some journaling and stuff like that and then going get an exercise, a workout in. So that so that the the routine has changed but the process still remains like I go to bed early and I get up early, right? And I work on the things that are priority in my life instead of a lot of, you know, the other distractions that are dangerous.

5:41— Yeah. — Yeah. That time those those couple hours in the morning uninterrupted, it's amazing what you can build during that time. So — yeah. Yeah. I'm curious ho how all of these different different paths within real estate, all these different types of deals ended up leading you to want to start a a turnkey business like what how and and also I guess do you recommend a turnkey business to others who are looking at potential options?

6:14— failure was the reason we started a turnkey business to be brutally honest with you. You know, to to my earlier point about, you know, me saying that like I just I I just learn a little bit, just enough to get me in trouble and then I go and do it. That was the same thing, you know, for experiencing a turnkey company on the the buyer side. You know, again, saving up money, had a stash of capital, wanted to get into some passive real estate investments, heard on Bigger Pockets podcast about, you know, some great turnkey company.

6:48Did very little due diligence and research on my own and and pulled the trigger on buying, you know, three single family houses in in Birmingham, Alabama, with the turnkey company that I did very little, you know, due diligence on. You know, they said that properties were in B+ C minus neighborhoods. Well, and you know, and the the numbers on the spreadsheet were were fantastic, but I never went to the location. I was stationed in Naples, Italy at the time. — I didn't talk to anybody except for like the the salesperson.

7:22And you know, come to find out, a year or two into it, like my houses were trashed. Any any cash flow that I had from the year was just immediately gone from a from a you know a renter turnover because they trashed the house like literally trash the house too like like it was gross like poop on the walls kind of stuff like just trash everywhere and you know any again cash flow completely wiped out — and so you know my fault like I didn't I didn't do the due diligence that I should have you know these these houses were like in the ghetto they were in the they were like Dminus neighborhoods Right.

7:56So from that experience like I learned a ton. And you know similarly at the time my college roommate from the academy like had a similar experience but really even worse like he had bought some turnkey properties from a company in Milwaukee, Wisconsin and they were fraudulent to the point of like you know they were saying they were putting new water heaters and new HVACs in but they weren't. They were just keeping the old ones in the house and pocketing the money for you know for the difference. And fortunately David caught them in that lie.

8:28Like they were scratching out like dates on HVAC. Like just just crazy stuff. — Oh my god. — So he was gonna take — So this made you guys want to get into turnkey. — The idea was man like if we could just if we could if we just did business with honesty like just the simple — just be honest and and and live through the business with our values. And you know we're both believers. We're Christians. So, like if we did business with like a like a Christian mindset and a biblical view and like we were just honest with people like when mistakes happen, we told them about it and if you know like something went wrong, we just we're honest about it.

9:05And so, like we're like, "Hey, we could this isn't hard. We we could do this stuff and and if we just live by our our principles and our values and we're honest with each other and with our, you know, with our clients, like we'd probably do okay." and so that's that was — And can you explain like for people who don't know what a turnkey company is, like how it's supposed to work. — Yeah. So so basically our our business model, so we started a turnkey company in Milwaukee, Wisconsin. David had had to basically fire everybody from the turnkey company that he had used, had to go out, find a new team.

9:38So we established a new team and so we were buying offmarket single family houses from wholesalers, you know, offmarket stuff that needed a bunch of work. We were raising private money. We were buying the house, rehabbing the house, fixing it up to really like to be really nice. And then we would turn it over to a a property management company. We weren't managing in-house. We turned it over to a property management company. They would get a renter in place. So, we we'd have a fully rehabbed, fully rented property management in place, turnkey product, and then we would go and sell that house to an investor who just wanted from day one a cash flowing rehabbed managed house that they could just buy and, you know, fairly quickly get cash flow from really day one.

10:23That's that's the the correct model. The correct model. You're basically buying a house that's fully rehabbed, in really good shape, — rented, property management in place, and you could literally buy it and have, you know, positive cash flow the first month after purchasing it. So, that was the goal. — Got it. Okay. Got it. And so how did that progress, I guess, for you guys then over time and and what did that look like? And then again, do you do you recommend this strategy after having experience with it?

10:55If someone's looking to get into real estate, do you think this is a good way to go? — so lot lots of lessons learned along the way. Lots of things we didn't do correctly. But, I I think that if I was going to do it all over again, I wouldn't have sold a single one of them and I'd have kept them all for myself or for ourselves, for David and I, and just kept them into our own portfolio. And that happened later on when when it got a little sticky with with COVID coming into play cuz that impacted our business significantly.

11:29But when we started it was fantastic. We we grew really really fast. All just by word of mouth because we were the honest you know operators. And we did things through our values and people just started telling other people about our company. So you know, year 1 I think we did about seven or eight houses. Year two I think we did 26. Year three we did about 50. Year four we did 50. So we got to about 50 60 a year at the peak of of the business.

12:01— And that was while we were kind of like in our top leadership roles in the Navy. David was the commanding officer of a of a cyber command. — and I was the executive officer. So, second in command of a really big reserve center here in Colorado where I live now. So it was busy, man. Like the 4 a.m. Wakeups was like hard charging in the real estate business until I went to my Navy job. And and I almost I I would say I probably cheated the Navy a little bit by the end of kind of that time period because I was really focused on building the real estate business just as much as I was being present for my Navy sailors.

12:37So, a little bit of a failure there to be honest with you, but, it grew quickly. It was a roller coaster. You know, when you have 6, 7, 8, 10 deals going in different stages of rehabs, you know, and you're planning on one house selling and using that profit to then fund another house that you're going to buy in the pipeline. That's going to it's going to it's dangerous. Like, something's going to happen, right? A closing isn't going to happen. And then you're going to be scrambling for money.

13:08And and God was always good like something happened to where we always found money or from a private lender or something like that. But but it was it was definitely it was stressful. There's a lot of anxiety in the business. And I from a health perspective I really wasn't in a great place around those periods like 2021 2022. My physical health my like spiritual emotional health wasn't great. My relationships with my kids and my wife weren't amazing because I was just so focused on the business and a lot of that came out of fear of getting out of the Navy pretty soon.

13:44— — and there's a lot there that we can go into, but maybe that's not the podcast for it. But but yeah, man. So, would I recommend it again? Not to that scale unless you unless this is your full-time thing, unless you are out of the military and this is your full-time gig and you can put a lot of processes and systems in place and you can hire the people that you need to hire quickly to do the jobs that you need to be done cuz it's not a one-man show. It's not a two twoperson show. It's it's it's a full team.

14:16You need a full team to be doing at that scale of the work that that we were doing it at. And so it it can be profitable. But it is there's there's it's a roller coaster. It's there's a lot of ups and downs. — I I personally like the single family space. I think there's a lot of options that come with that. I think there's a lot of flexibility in single family houses. There's a lot of exit strategies. There's not as many exit strategies in commercial and multif family and apartments and stuff like that.

14:47And so I still dabble in that space. I still flip houses. I still buy rentals. But it's not like five, six, 10 at a time. It's it's like one at a time. And so that's where I would recommend kind of staying and being unless you want to go full-time as a business after you're out of the military. — Got it. Okay. Yeah. And I it again like we were talking earlier when we we spoke you know a couple weeks ago about I I had a very similar experience like we were flipping houses but I look back and I'm like man if we had kept just some of the ones we flipped let alone all of them — they'd be worth like three four times as much as what we sold them for in a lot of cases.

15:34So at the same time you were doing this in Milwaukee, I was flipping houses in in Chicago having very similar you know experience at that time. And I think for turnkey because that was attractive to me as well. And it's you know similar to flipping. It's but I think the the cool thing about turnkey is you have buyers in place, you know, and so I think what I've seen unfortunately I've heard so many horror stories about turnkey companies and it seems like they always start off with good intentions of like you know we rehab it, we sell it, make a good profit and then we'll manage it for you.

16:12And it's like the first phase of that goes well, they sell it, and then the management sort of trickles off with a lot of these companies. And like you said, there's all kinds of crazy stuff that can that can happen. But, to your credit, like to be honest, I think that that's that's the rarity it seems like with these turnkey companies is, that they're staying on top of things and going to continue to support your your your property in a perpetuity, not just get a big fee from you on the sale and then move on. So, — there's there's a lot of there's a lot of people involved.

16:46There's a lot of teams involved in that in that entire, you know, business process. And there's just there's just a lot of opportunities for for failure in that. So you you really do like a company that does well in that specific niche has to have stuff dial dialed in, you know, has to have a big team, has to have you know, just really good systems and processes and and then like stick to their word, which you know when when money gets involved that gets a little that gets a little tricky, right?

17:21You know, when — when you know and we had many of occasion where we, you know, maybe decided that, the house didn't need a new roof or it didn't need a new HVAC and then, you know, our turnkey purchaser bought the house and, you know, a couple months in, the roof failed or the HVAC failed and, you know, our guarantee was that you're not going to have any capital expenditures for the first 2 years of owning the property. But we told them that if you do have a big expense like that and we should have, you know, fixed it, then then that's on us.

17:56Like we'll cover it. And and that like $5,000 bill, you know, a year after you sold that house because, you know, you didn't put an HVAC in and it failed. Like that's hard. That that's that's tough to like swallow. It's painful. — But — that's our word, right? And and we had to stick to that. And we, you know, — honesty, integrity was one of our core values. And like we we had to like hold to that and and I think that's why we were successful. That's why we did grow through just referral, word of mouth marketing.

18:28But that's still hard to do and I think there's a lot of people in a lot of companies that aren't willing to to stick with that.