BP Podcast 167: 0 to 25 Units in Your First Year (Part-Time!) with Kevin Wood

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People have a lot of excuses about why they aren’t’ investing in real estate. “I work too much.” “I live in an expensive area.” “I don’t know enough.” But on today’s show, we sit down with a BiggerPockets member who is absolutely crushing it — despite a full-time job, living in Silicon Valley, and being brand-new to real estate. You’ll learn how Kevin Wood has managed to go from zero to twenty-five deals in under a year, largely using networking on BiggerPockets to make it happen. You’ll be inspired, motivated, and educated to get off the bench and jump into the game!

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In This Episode We Cover:

  • How Kevin went from 0 to 25 units in less than a year
  • How to overcome the fear of buying that first deal
  • How BiggerPockets helped Kevin focus on his investing
  • The “condo mistake” Kevin almost made for his first deal
  • How to have a competitive advantage
  • Tips for approaching other investors
  • Why (and how) Kevin bought five houses at once for his first deal
  • The logistics of buying five properties at once as a newbie
  • How to know if you’re buying a good deal or not
  • The benefits of analyzing 100 deals
  • Investing in stocks vs. real estate
  • How to make a good partnership
  • Tips on working with partners — the good, bad, and ugly
  • How to introduce yourself on BiggerPockets
  • How Kevin got a $200,000 discount on his 6-plex
  • The 14-unit turnaround — and the drama associated with it
  • How to work with a designer to get the best look for a unit
  • A discussion on contractors and how to find them
  • How to manage a multifamily complex
  • The caveats associated with big fixer-upper deals
  • Tips on going for package deals
  • The genius negotiating strategy Kevin uses to get incredible deals
  • And SO much more!

Links from the Show

Before and After Images

Books Mentioned in this Show

Tweetable Topics:

  • “Once you have that first deal, you suddenly become more legitimate.” (Tweet This!)
  • “Once the number makes sense, then we do everything we can to find the yes.” (Tweet This!)
  • “Never compromise in your returns.” (Tweet This!)

Connect with Kevin

About Author

Thanks for checking out the BiggerPockets Real Estate Investing & Wealth Building Podcast. Hosts Joshua Dorkin & Brandon Turner strive to bring top-notch educational content and interviews to our listeners -- without the non-stop pitch prevalent around the industry. With over 80,000 listeners per show, the BiggerPockets Podcast has become the biggest real estate podcast in the world. But don’t take our word for it. We’re the top-rated and reviewed real estate show on iTunes — check it out, read the reviews on iTunes, and get busy listening and learning!

33 Comments

  1. Sharon Tzib

    Ok guys – Brandon, you were right! My last name is pronounced “zib,” (silent T) lol! I still love ya though Kevin 🙂

    Moving right along, wonderful podcast. For any of you watching, Kevin is one of the smartest, dedicated, and most committed investors I’ve ever had the pleasure of working with. He made my job very easy because he knew his criteria, stuck to his guns on his numbers, and was organized and able to provide everything quickly that the lender and we realtors needed.

    He also doesn’t wait for the deal to be “brought” to him or fall in his lap. He is out there actively, almost daily, looking at the deals that come out on the MLS. Most of them aren’t good, but you must put in the work and analyze a lot of deals to find the right one. I find too many investors want to be handed the deal, and that, in most cases, just won’t happen.

    Thanks again for the shout out guys, and a huge congrats to Matt and you on all your successes, Kevin. I’m honored to have been a help to you and to be a member of your team, and I look forward to helping you on future endeavors.

      • Kevin Wood

        No luckily the mold was just in that isolated spot and hadn’t penetrated the drywall. We spend about 2-3k per unit to renovate and had some additional costs related to repairing roofs, uneven joists, etc.

        • David Sharp

          Hi Kevin – Great show. Can you tell us where you get your appliances, that you are able to go stainless steel and keep your total renovation per unit to 2-3k? Again, great job!

          Thank you!

        • Kevin Wood

          David we get our appliances from home depot. We buy the smallest range and the smallest fridge due to the size of the apartment. We save a lot on texturing (do it ourselves or 16 an hour), painting (couple 100), and bathroom tile work. We also are making changes to the property that are not on per unit costs (roofs, windows, paint, cleaning, etc.). We’ve spent I believe 40k on the whole complex as I said in the podcast. So 2-3k per unit is only the estimated per unit cost.

        • Kevin Wood

          David, I was wrong on my number of 2-3k per unit. Not the 40k number. It is more like 5k per unit. I had written in my pre-show notes 2-3k but did not included appliances. I apologize! Wish I could go back and correct it. We spend about 1-1.5k for an oven/fridge combo though we use smaller than the standard sizes.

      • Kevin Wood

        For financing we had to put down 20-25% of the purchase price in cash. The bank would then finance based on the quality of the property. Having good credit is important as it shows you are capable of paying back debt. If you have bad credit I would focus on that right now.

        • John Griswold

          Kevin, you mentioned that the bank accepted your offer over another offer for 30K more because of its presentation. Could you expound on that please?

        • Kevin Wood

          Sharon Tzib put together a package that included our bank commitment letter as well as a fully filled out and complete offer just waiting for the seller’s signature. We did as much work as possible on the deal. The other seller apparently had incomplete documents with no bank guarantee. It was the seller who selected the lower offer not the bank. Having a good realtor can make a ton of difference.

    • Brian Murray

      Key Kevin! Great podcast. I’m the podcast guest you referenced (we are the ones that moved our management office into the distressed apartment building – see episode 126.) So I can definitely relate to the project you shared! Sounds like you’re doing great things- enjoyed listening!

  2. Nathan Gesner

    Can you share some hard numbers? According to my estimate, you’ve invested $150,000 in the 14-plex so far. Is it cash-flowing? What is your estimated value and equity as if today?

    I really like the idea of breaking down package deals and then picking only the best parts. Thanks for sharing!

    • Kevin Wood

      We’ve invested about 40k for repairs in the 14 plex. It is not cash flowing, which I think I mentioned in the podcast, we are going for appreciation over the quick dollar and are investing in order to get market rents. Depends on what cap rate you want to use in the heights but we add about 34k in property value per unit remodeled assuming we can raise the rent consistently 200 per month.

  3. Dave Maheshwari

    Great podcast Kevin, lot of good tips for a newbie like me … Btw, I work in Bay Area as well … a newbie in REstate … at this point all I am doing is reading, reading and listening …Have slowly started crunching numbers as suggested in this podcast
    Thanks for the tips, hope to get in touch some day when I have some value add 🙂

  4. Kelli Ford

    Hi Kevin! Great podcast, thank you for all the wisdom that you shared. I wanted to know what negotiating book would you recommend? Also you said to get a deal on the land and not the property especially if it needs repairs, how would you go about coming up with an offer that is fair, so to speak?

    • Kevin Wood

      I like the Secrets of Power Negotiating a lot. I listen to it on audio. Zig Ziglar is another staple. I always calculate what I think the property is worth today and then make an offer to reflect that value. I use a calculator to come up with that number. Your goal is to get as good of a deal as you can. Fair is relative to both parties in the transaction.

  5. Alison Koenig

    Great interview! Super motivating for a newbie! The best advice he gave was that he gets the local business newsletter and stays abreast on the area. Totally took that action step (I’m new to the area I’m investing in)! Listened to this yesterday, same day signed up for the newsletter, and already getting great info. Also learned that I could pay for lists through that website. Not ready yet, but from the great tip, that led to something even better.

  6. Prabodh Kumar kandala

    Way to go Kevin. You are an inspiration. Great Podcast.
    I just scrolled through podcasts and picked this one. This is the first podcast I heard on bigger pockets.
    Thanks to Brandon and Josh for bringing up this great podcast.
    I am an aspiring investor. Robert Kayosaki’s influenced me by his call through “Rich Dad Poor Dad”.
    Currently, I am in reading phase with eye to launch in 2017.

    Kevin, one question I had while listening to podcast was how did you invest in your first property? Did you save money for this or did you take alternate approaches. Please answer if you get a chance to read this.

  7. Perri Kallergis

    Kevin, Just listened to podcast167. Very informative and inspirying.. I’m a REI from Melbourne Australia. The market down under is at all time highs and very expensive. Over the years I have been involved in residential (FMR), Development and currently hold 4 commercial/industrial REI all leased. I’m very keen to get involved an invest in the US market and have just become a BP PRO member. What’s your tip about identifying a suitable location/state in the US for a foreign investor such as myself?
    Always interested in equity partnership if you have any projects of interest.

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