All Forum Posts by: Scott Johnson

Wealth is defined as "How many days forward can you live without working." so I'm responding based on that definition. 

@Colton Hahn and @Jared Hottle are correct in that syndication deals take a lot of the leg work out of investing. You still need to study the hell out of the prospectus to make sure you understand it, but other than that it's basic financial literacy. I'd seek out a mentor on BP that's actively participating in syndications.

As you have capital, there are numerous ways you can invest it and get the benefits from real estate: 

• Direct Private Lending
• Transactional Lending
• Investing in Notes
• Lending to a Hard Money Lender
• Buy-and-hold (Residential, Commercial, Etc)
• BRRRR (This is flipping and buy and hold combined with a refinance)

The wealth is derived from passive income, which is why I'm not mentioning flipping or wholesaling. Those are active income and don't fit into what you're looking for. The closest you'd come to that is a BRRRR, which ends with passive income and refinances. These can all be done in your own backyard.

On the private lending side, take a step back and look at what your friends, family, and acquaintance are doing. Are they flipping or buying rentals? You may want to approach them about private lending (if you trust them). Also, head to your local REIA to meet up with other investors who may need other types of lending. You may run into a firm who'll put your money to work!

These all have their benefits and drawbacks, so you're going to want to do the work and investigate them yourself and let us know if you have any questions!

On the paying yourself, that's a great question for your CPA! Wish I could guide you but that's out of my expertise. 

I hope this helps!

Hey, BP!

My grandfather's Alzheimers is coming to a head and he's needing more attention and care. Over the last three years, my brother and I have been helping my parents develop their rental portfolio so they can retire. Naturally, my first thought was "How, can we pay for Grandpa's long-term care?". 

There is a lack of Residential Multi-Unit properties here in my area and with the growth we're seeing, I feel like there may be time for some more to pop up. Since we can't find many on the market, we're looking at building one. We chose 4-Unit because we're looking for land outside of the city limits, and Rural Residential (RR) zoning (Which a lot of the land is) allows us to develop up to a 4-Unit property without changing the zoning. We're leaning more toward four smaller houses, rather than one building, and building them so they can be parceled out and sold in the future. 

I'm educating myself on the master plan for our county so I know what they're wanting to be done in a given area. 

I'm looking to connect with someone who has developed a Residential Multi-Family property before. I'm happy to work for free on any project you're doing or trade services in return for being able to shadow you. My skillset is centered around video marketing and relationship development.

The questions I have are as follows:

- What questions should I ask when interviewing builders?

- Does it matter where the builder is located, or do they just subcontract local people?

- What are your thoughts on one building (or side-by-side houses) vs building so each unit can be parceled out in the future?

Thanks in advance!

@Leila Moussavi, It's important to note how everyone is responding, and I'm fully on board with them. As a new investor, I always recommend being able to walk or drive to your first rental. If it's good enough for Robert Kiyosaki, it's good enough for me. That allows you to check in on it every now and then, even if you have a property manager, and see how things are running. You'll learn by osmosis and asking your property manager questions. Or, heck, manage it yourself and get the full education.

If you are dead set on investing OOS, find someone here or in your local REIA that you can partner with. Any partner won't do it, they need to have experience.

Of course, if your goal is to lose money for tax purposes, then the aforementioned advice is null and void. Investing OOS with no prior experience and no mentor is a great way to get those incentives.

No confusion on my end. You had me at 790 Credit and 4x the rent with no credit dings or pets.

One renter with no known issues and another without the money and a fair amount of issues... I'll let you do the math :P

I like that. I'm the same way. Not always is the highest sale price what the client wants, especially if they're in danger of being foreclosed on. As Realtors we do what our clients believe is in their best interest after we've educated them on their options.

@Ben M. https://www.carrot.com

Nothing else needs to be said 😜

Congratulations, dude that’s exciting!
That’s the right attitude to have. Even if it’s not a massive moneymaker, you still learn a lot and figure out what to do differently next time.

Since you have a broker on your team, lean on them to do a comparative market analysis. Comps that are currently pending or for sale are used when you are about to list and are checking out the competition. Closed only for CMAs, but sometimes a broker has to do what they have to do when there’s no closed comps.

I use Lending Home on a recent deal, and I liked them. 

Glad you took the first step! Don’t stop here, keep going!

Agreed. @Chandler Butler, Schedule appointments with big, small, and boutique brokerages. Education is the most important thing when you're first starting out. Start learning, take action, and keep an eye on who's a top agent and what they're doing. 

Just remember that a lot of brokers focus on the commission, but as Realtors we need to focus on achieving the client's most desirable outcome (which is not always the highest selling price). 

Also, books like Sold! by David Green and The Millionaire Real Estate Agent by Gary Keller (my favorite) educate you on the core concepts of lead generation and where to put your focus.

YOU ARE NOT IN THE BUSINESS OF SELLING REAL ESTATE. YOU ARE IN THE BUSINESS OF GENERATING LEADS.

Well put, sir! 

I'd also like to add that most people focus on cash flow and appreciation, but one of my mentors uses a "tax-averse" strategy that focuses on maximizing the loan payment amount by lowering the loan term. This maximizes "loan paydown" and the effects of "depreciation". He then refinances out tax-free cash every 5 years. 

Cash Flow and appreciation are the sexy ones, but the most powerful incentives are those that lie below the surface. Different areas can benefit from different strategies. Maybe this one will work for you.

Congratulations on starting your journey! It's totally worth it and you'll learn a lot!

Honestly, I like a new investor's rental property to be as far away as they're willing to drive. That's just personal preference, though. If you're going to invest out of state, it's a good idea to link up with someone who does that and read David Green's book on the subject.

I looked into it a bit and found a town named Littleton further north of you (maybe a 30-minute drive?). Do you know anything about that area? Looks like there've been multiple properties in that and cities within 5 miles that have sold for sub $200,000.00. Most were 1,700 sqft, which is what I look for in a rental. Also, a majority of the people living in Littleton make <$100,000.00 and they have to be living somewhere within 30 minutes (since that's the average commute time).

There's also a place called Calico that's showing a lot of distressed properties. Not certain that's a place you should go, but you never know. Start your search for properties around Littleton and roll from there! Get in touch with a Realtor in that area and get to know them. They can give you a LOT of information about the market there using Realtor's Property Resource. Also, see if there's a REIA in that area and connect with investors. You can find wholesalers by searching "We Buy Houses In Littleton Colorado" and "Sell My House Fast In Littleton Colorado". Use an incognito window so you get unbiased search results.