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⏲️ TIME STAMPS ⏲️
0:00 : Preview…
2:40 : Show begins🔥
3:00 : Upcoming college debate | Myron’s new book
3:30 : Who is Roger?
4:20 : 10 THINGS you must know before investing in Real Estate
5:00 : #1 - Have a goal
8:20 : #2 - Side with a strategy
9:30 : Benefits of House-hacking
11:10 : #3 - Pick your location wisely
12:40 : What should you look for in a tenant?
16:50 : #4 - Financing
18:20 : #5 - Understand your income & expenses
21:00 : #6 - Learn how to screen your tenants properly
27:40 : “Should I go all in my business as a 22 year old pt?”
28:50 : Quick Recap of the show
29:50 : How much money should you have for the rainy day?
32:20 : #7 - Be aware of local landlord-tenant laws & regulations
35:30 : Do the before raising the rent…
36:20 : #8 - Hire a property manager
37:50 : #9 - Build good relationships
39:00 : #10 - If you wanna scale big, have systems in place early
41:20 : Quick Recap of 10 things
44:00 : What is Class A, Class B, or Class C property?
46:50 : Which class property should you buy?
48:30 : Q&A Session…💬 | How do I find a good mentor?
50:30 : Buying a house with an LLC - can you do that with a starter home or is it better later on?
52:00 : Thoughts on Real Estate in Michigan?
52:30 : “My wife and I want to get our first home & have $10k in savings”
53:40 : “200k saved at 21 & I want to land a 800k home”
56:30 : Thoughts on mobile homes
57:20 : The 1% Rule in Real Estate
1:00:10 : How do go on about buying your first home?
1:01:30 : What home can you buy with $40k?
1:03:20 : Thoughts on mid-term rentals and pad plit
1:05:10 : Any advice for investing In Canada
1:06:30 : Best asset protection to shield yourself from lawsuits
1:07:30 : 24 year old veteran wants to buy a home with VA
1:09:30 : Just closed my apartment last week 73k in cash, any tax tips?
1:11:50 : I want to open my own property management business, what do I need?
1:12:30 : Sri Lankan wants to buy a property in US
1:14:30 : Can I make $5k working 16hoursday
1:14:50 : What kinda jobs should I look for to learn real estate game?
1:16:10 : Should the tenants pay for their utilities?
1:17:30 : I saved up $40k & want to buy 300k-400k property
1:19:00 : How to look for good home insurance?
1:20:30 : I live in NYC and make 170k annually, should I pull money out of my 401k to invest?
1:21:40 : Dating advice for a 23y/o making 5k/month
1:23:00 : Why we advice against buying condos
1:23:40 : Thoughts in investing in small town in Georgia, family has 226 doors and 85 properties😳
1:25:00 : How can you reach out to Roger?
1:25:20 : Should you focus on stocks investments while you have a mortgage?
1:26:00 : Electrician making $9k/month, Should I get a Multi family house or do the BRRRR method?
1:29:00 : I only have 5k saved making 102k a year…
1:29:40 : Final words from Roger | Outro Show less
It's going to be a how-to from A to Z. Let's get into it.
You
All right, and we are live, guys.
What's up?
Welcome to the Fresh Hit Podcast, man.
It is Monday Monday.
We have been due for this one for a very long time.
We've got a very special guest in the house, my real estate agent/slash property manager slash friend for a very long time.
Roger, welcome to the show, man.
Thank you very much.
It's been a long time.
It has been a while.
Dr. Marco, Marco, looking out to this.
Guys, February 4th, I'm going to be at USC in South Carolina, University of Southern Carolina.
And then book comes out February 14th.
I think we pretty much have it done.
Me and Chris and Aaron Clary have been kind of doing the artwork, and that's pretty much ready to go.
I am going to probably get like a test copy here very soon.
And the book comes out February 14th.
Why wouldn't we deserve even less?
Very soon.
We just got done doing a stream on Aaron Gaines X where I covered the ice shooting that was debating some liberals on Twitter.
I didn't get a chance to cover some of the other stories, which I will cover for you guys tomorrow because I am going to be here all week for y'all.
But other than that, man, Roger, welcome to the show, man.
For those of you that don't know or are new to the program, can you introduce yourself to the people?
Controlling Asset Costs00:15:06
My name is Roger LaSad, real estate broker.
I own my own firm, Roger LaSad Realty.
In addition to brokering sales, land sales, multifamily sales, mainly commercial, mainly work with investors.
Also do property management with many, many properties that Myron currently owns.
Okay, I guess I got to switch mics.
Do they hear me out?
Yeah okay, I was coming in low before.
Yeah okay, so I guess, where do you want to take it from from here, from the the beginning?
Well, like you said, we were looking at 10 things you need to know before you want to invest in real estate, so I just came up with a nice little list.
There's 10 of them, so I got a nice little piece of paper here to refer to that I'll expand upon sure um, and I would start off with the first thing.
If you remember, when we started this, I asked you this first question as well, like, what was your goal?
What was it that you were looking to achieve?
Because I think a lot of people will say well, I want to invest in real estate, but they don't have a goal in mind, and then that just, they don't have something to keep keep themselves going.
Okay yeah, there you go better.
I think so.
Yeah, you're good yeah.
So, number one, have a goal.
What?
What do I mean by that?
Um, for most people, it might be something simple, it might be, I'd like to um, get a real estate property so I could pay my car note or pay my car expenses, or maybe I want to put more money away for retirement, or maybe I want a little bit more disposable income.
I think if you start off small like that, it's easier for you to get going versus saying well, I want to replace my, my monthly income or something that was my first goal was like I want to replace.
Once I started doing the social media stuff, I was like okay, I want to be able to replace my government income with, with real estate.
That was my original goal, and then obviously, you can expand from there.
But like all right, in your case um it's, it's took a while right, it's not like one or two properties no, depending on how many yeah, depending on how much you need.
So, for me my, i'll never forget my original goal.
At the time when I left the government, I was like uh netting right obviously, on paper i'm making like 10k a month, but I was really netting like more, like 7 000 right, so a month when I was working for the government.
So uh, this is like, oh man, this is 2020.
Yeah, this is around 2020.
So I would have um for me.
I was like okay, I need to make seven to seventy, five hundred a month to pretty much cover what I used to make for the government and and that was that was my goal originally um.
And then obviously you need to get a certain amount of houses to be able to make that happen with cash flow and stuff.
But uh, but I do think that yeah, having a goal, um is super important.
No you, you got to start from a goal, because if, if you started off, maybe you get a bad tenant, maybe you have some unexpected um bills that you didn't uh, that you didn't factor in, that could derail.
Or maybe you just buy a house that's a headache and things aren't working out.
Yeah, that could just derail it.
You could say well, this sucks, this doesn't work, I don't care, i'm out yep yep, um.
And and that's super important too, because having your goal in mind is going to dictate how aggressive you invest, right?
No, absolutely so.
Like if your goal is to, you know, I just want some side income, like i'm not looking to completely replace another whole thing, I just want to make a couple hundred A month or something like that, that is going to dictate which deals you're going to take on, your level of risk, and everything else like that.
Yeah, exactly.
Everything is based upon your goal.
Yeah, exactly.
So that's super important.
I don't think enough people have that goal in mind.
They're just kind of like, I want to invest in real estate, but they don't really say if you ask them, okay, what is your goal within the resource?
They're like, oh, I just want to make what do you know?
Exactly.
Like in your case, you were very aggressive.
Some people, I just want $1,000 extra a month.
If I just get $1,000 extra a month, like, you know, I'm good.
I can do XYZ.
I can save an extra $12,000 a year over 20 years, put that away in a nice little conservative investment.
That's a huge difference.
So that's why I say it's important to do that.
Yeah, no, that really is.
And I'm glad that, you know, because there's a bunch of people here that probably want to get into real estate and they're like, oh, what's the first step?
And I would say, yeah, that's definitely the first step because that's going to dictate what type of deals you look at, what type of deals you take on, how you're going to pitch, what you're willing to tolerate when it comes to cash on cash returns, whether you want to get into buying it as an investor versus being a fixer and flipper versus being a, you know, someone that arbitrages.
There's so many different ways to go about it.
Absolutely.
And then number two would be to decide on a strategy.
And what do I mean by this?
There's more than one way to skin a cat.
Real simple.
You could house hack, which I think, not I think, that's actually what Fresh did.
Yes.
Where he started off with a triplex and he lived in one of the units for a year and then he moved out after a year and put someone in there.
You could do that with a single family, a duplex, triplex, quadplex.
Even with the single family, some people, I don't have experience, but I've heard of people doing this where they'll buy a house and they'll rent out rooms or a basement.
And there's even a website called PadSplit where you find people that are looking and that they're, I mean, once again, I haven't used this, but supposedly it's vetted.
You could find people, good tenants that you want to base, that want to share a room in a house as opposed to just getting something for themselves.
So you could either do that, or if you have enough money, you could just do the conventional route, get either a single family that you're not going to live in or a duplex, triplex, or quadplex.
Or if you have a really good amount of money, you go to multifamily.
Yeah.
So and the benefit of this, guys, with house hacking is because when you buy a house, there's like two ways you're going to buy it.
You can buy it pretty much as an investor where you put 20% down, 20 to 25% down, or you can buy it as a like a home, like, you know, you're going to live in it, right?
You're going to occupy it.
If you buy a home and you plan to occupy it, the bank is going to give you far more favorable loan terms where we're talking about a lower interest rate, you put less money down.
If you buy as an investor, 20 to 25% is going down.
If you buy it as I'm going to live in it as an occupier, now you can only put, now you only have to put 3% to 5% down.
That's significantly less cash of your own that you have to put in the deal.
And the bank will give you the other, you know, 90 to 95% of the loan, which is very attractive because it lets you basically get into the asset, live in the asset for a fraction of the cost.
And then you can have tenants offset that higher mortgage.
Because obviously the less money you put down, the higher your monthly payment is going to be, but you're getting into it, controlling the asset, and then hopefully your tenants will help offset that cost for you.
So that's one of the benefits of house hacking, especially if you don't have that much capital.
It's one of the best ways to get your first property.
You can do it with a duplex, triplex, or even a fourplex because these are all considered residential real estate versus five and up is considered commercial, which you won't be able to get in an FHA or house hack with a commercial property with a five or up, but you can go all the way up until four, which is really good.
Because if you somehow get a fourplex with, you get a fourplex and you have to hack that, now you have three tenants to offset that mortgage that you're going to pay.
So.
And then moving right along, pick your location wisely.
And why do I say this?
The quality of your tenant is going to be dictated by the location of your property and the condition of your property.
So when I say pick your location wisely, the number one thing you guys got to ask yourself is when you're buying a rental income property and you want to have good tenants, you got to ask yourself, where is the money going to come from for my tenants to pay my rent?
So what do I mean by that?
You definitely don't want to get a rental property that's out in the middle of nowhere or very far from like a major economic center.
It's got to be nearby an area where most people can relatively easily find work, right?
So that's number one.
It has to be in a desirable area, has to be in an area that's relatively safe, not too far away from decent shopping as far as supermarkets, as far as entertainment, et cetera, et cetera, et cetera.
So, and that's one thing I think a lot of people really don't understand because they invest in like really crappy areas and then they can't get decent tenants.
They put crappy tenants in there.
Those tenants give them problems.
Then they say real estate investing doesn't work.
Of course.
Now, you've done, you've dealt with a lot of my tenants.
What are the two, for those of you that, for those people that might have a property or might be thinking about obviously getting a property and putting tenants in, what are some of the biggest things that you had to look for or things that were like red flags or things that you tried to avoid or you looked for positively to dictate whether a tenant was going to be problematic or not?
I mean, I hate to say this, but I mean, I would say the most important thing.
Well, let me not even say the most important thing.
When you're looking at a tenant, you definitely want to make sure that household income is no more than 30%.
I mean, that household income, when you factor in household income, the rent is going to be no more than 30% of the household income.
Gotcha.
Are we talking before or after taxes?
Before taxes.
Before taxes.
Yeah.
So that's one.
And then the second thing, you know.
So if they make 10K a month, they need to make 10K a month if you're going to price rent at 3,000.
Correct.
Okay.
Remember, household income, right?
Usually it's not one person.
It's either a couple or a few people chipping in.
And then the next thing I would say is you got to pay attention to credit scores.
And there's a couple different ways you do it.
Like, obviously, if they've got a really high credit store, you're good to go.
Even if they have marginal credit, which I would say the 650 to 680, you definitely want to look to see, do they have a lot of collections?
If it's a situation where maybe they messed up here and there, but they don't have collections or it's very low, you're probably good to go with that.
Also, I would say look at an aggregate of the credit scores.
A lot of times you'll have maybe a couple where one has a really good credit and the other one has challenge credit.
If you average it out, that kind of gives you a good idea where they're at.
So it's not necessarily a situation where, well, the husband's great, the wife is bad or vice versa that you decline them.
And then ultimately, if it's a little bit below what you feel comfortable with, you could always ask for additional security deposits.
Okay.
So if you had to pick one, what is a bigger predictor of a problematic tenant?
Would you say it's a low credit score or would it be income isn't enough?
Low credit score.
Low credit score is way more important, right?
Because, I mean, full disclosure, we've had two tenants exactly made way more.
Like they were making almost four times what the rent was, but they were screw-ups.
The airline mechanic, right?
Yeah, like he was one of them.
Yeah, so the guy was making like $150K per year and he still was not paying rent, which is like ridiculous.
I don't know if I told you is that there was a girl involved that he got ended up getting married.
I think he ended up paying for a wedding instead of paying the rent or something crazy.
That's what happened.
Of course.
Idiots.
But yeah, so you know, so I guess the bottom line here is credit outweighs income.
No, I would say, yeah, I would say it's well, I mean, obviously, but like if you have to pick one that's a bit more important, that would be a bigger determinant.
But at the same token, you definitely want to make sure they have enough money to pay, right?
Especially, and in case something were to happen, that's why we say no more than 30% of their income because you figure, well, what if one of them loses?
What about gross income for the year?
I know a lot of people say 60K per year tends to be the cutoff where they make more than 60, they're going to probably be okay.
But would you also account for like a certain amount that they should be making per year?
Or do you just go solely off credit score and credit score?
30%.
Yeah, the rent should be 30% or lower of their gross income because you're pretty much go.
And I know a lot of people are like, well, what's going on?
We're hearing people are paying.
So annual doesn't matter to you.
What matters more is that 30% number and credit score.
Yeah.
Okay.
Fair.
And I understand in Miami market, obviously, rents have gotten really high.
They've also come back down.
But yeah, I know a lot of people are in tough spots, but if you're in a situation where 50% of your gross income is going to rent, that's yeah.
I mean, I hate to say it.
That's not a good spot to be in.
And because then all it takes is a little shock and then they can't pay the rent.
And then what?
Yeah.
Yeah.
No, it's true.
Very, very true.
And we've dealt with it.
So.
Okay.
You spoke about this a little earlier.
Financing.
So this is a part that I think a lot of people really don't take enough time to look into.
Not just getting a loan, but you have to understand you could literally have two mortgages, same interest rate.
But then when you look at the total cost of the mortgage, it might be different.
And why then the reason I say that is sometimes bank A might give you more higher origination fees than Bank B, which is why I'd also recommend that when you're going through the process, in addition to talking to your main, you should talk to a mortgage broker.
And then there's another thing too, depending on your individual situation, depending on the type of property you're looking to invest, there might be specific lenders that have products that are a better fit for you than your bank could be offering.
And like I said before, don't just go in there thinking, well, I need to borrow X amount at this interest rate.
The finance, you know, a lot of these bankers, lenders, they've become really good at adding hidden costs and additional cost.
So don't just think in terms of loan amount and interest rate.
All right.
Next on the list, understanding.
We're number four now.
Yeah.
Well, actually, now we're at number five.
Okay.
Next on the list.
Hey, guys, get your questions in, by the way.
We're going to have like a little Q ⁇ A here for you guys after for this.
And then we'll also go into some of the things that we run into from you, like managing and stuff as well.
So next on the list, understanding your income and expenses.
This is, yeah, this is a pretty big one, guys.
Pretty big one.
It's cool for you to sit back and say, well, you know, I mean, I'm bringing in this much.
And then after my expenses, I'm still bringing a profit.
That's cool.
Understanding Income and Expenses00:15:17
However, you might notice over time, certain expenses start to pile up.
And then I think sometimes they're gradual.
People don't notice.
You definitely want to know what's considered a normal utility bill if you are paying the utilities, like a certain amount of electric, water, et cetera.
Because sometimes when you see a spike or you see a trend of something going up, it's not as simple as the tenants are just using more stuff.
Like in some cases, like in one property, we had homeless people going on and using the water from the outside to like bathe themselves at night.
So that was raising the water bill.
In another instance, there was a bath, there was a toilet that was running all the time.
That causes, and the problem is, obviously.
Tenants do dumb things, guys.
Yeah, when the tenants aren't paying for stuff, they won't alert you.
But yeah, you definitely want to make sure.
And then another thing too that I'll share with you, as I'm sure a lot of you guys know, in South Florida, we've had some dramatic rises in property taxes and insurance.
That's something that I don't know if a lot of people are aware of this, but with your property taxes, when they raise them, you can challenge those.
And it doesn't cost you anything.
And even if most of the time there, you know, you're not going to win, but a handful of times you may.
So you definitely want to challenge that.
You definitely watch your expenses.
And you definitely want to have some reserves because I guarantee you, through the course of you owning a real estate property, there are going to be expenses.
There are going to be emergencies that are going to come up that you didn't think of before.
Reserves is huge.
Yeah.
And Fresh harps on this so much that when he bought his house, he basically spent all of his money to get the house and he had like no reserves.
So he couldn't do repairs.
He couldn't do anything for a period of time.
And he basically became what he called house poor because he used all of his money to get into the property.
And then he didn't have any type of money to actually fix things.
And that created some issues for him.
Yep.
And then, oh, here's the big one.
Okay.
Learn how to screen your tenants properly.
So, all right.
So we were talking about this a little bit earlier.
So obviously you're going to look at the income.
You're going to make sure their gross income, the rent is no more than 30% of their gross income.
You're going to make sure they have at least fair to better credit.
When you do background checks, obviously you're going to check for violent crime.
You're going to check for rental history.
You're going to check for employment history.
And unfortunately, that's where a lot of people stop.
So when you're checking for employment history, you also need to check for employment verification and income verification.
What do I mean by this?
You're going to call the employer, right?
You're going to identify who you are.
Let them know, ask to speak to the right person.
Let them know that, hey, you're such and such.
Such and such has applied to lease a unit from you.
You would like to confirm that they are currently employed.
Okay, yes.
Now, here's the gotcha.
A lot of people don't bother asking, is this full-time, part-time, or is this employment schedule to terminate anytime soon?
These are important questions to ask.
And then you can ask to verify, and most likely they're not going to tell you, but you could ask them according to their application.
It says that they make X. Can you verify that they do make X?
Now, the only little tricky thing with that is that with some of these big Fortune 500 companies, yeah, HR is not going to tell you, or they're going to send you to some automated system that, no.
In that case, what you do is you ask for copies of their bank statements to verify that you're seeing a direct deposit in the amount that they said they make.
And I would say you probably want to go back like six months, three to six months just to cover that.
Now, when you are verifying rental history, this is the one where a lot of people try to get slick.
They'll give you an address.
I was renting from here.
Then they'll say, this guy is the landlord or the property manager.
I've called multiple people where I've called and I'm asking, I identify who I am.
I'm like, are you the property manager or the owner?
They say yes.
Do you know such and such?
Blah, blah, blah.
Rave reviews.
And then I ask them, I was like, do you know such and such?
And such and such is the actual name registered to the, as the owner of the house.
And they say no.
And I'm like, yeah, wait, I thought you said you were the owner.
How do you not know who such and so?
Like, who is that?
That's who's registered on the tax records, which, by the way, is public information if they haven't put it behind an LLC.
So I've caught a few people, quite a few people like that are the guys like, well, you know, I'm the property manager.
And then I'll ask them a question.
Can you describe how the house looks like?
Like, where's the front?
They don't know.
So what people are doing, they're essentially giving like a friend or somebody else to try to give them a good rent.
Some fake being the, yeah, like it was my property, but the records don't match the person you called.
Yes.
And they can't even describe the property.
So obviously that's a denial.
That's a denial.
Wow.
Another one.
People go to this extent.
Hey, bro, this real estate guy is going to call you.
I did your lie and say that you own this address right here.
That's wild.
And then another one is people that are looking to rent within like a few days or a week.
That's usually a red flag because most people, you know, like you, you basically have to give like 60 days notice down there.
So when someone just pops up and they're like, oh, yeah, I'm looking to move in like next week.
Not always, but that's a bit of a red flag that they might have gotten evicted or they're about to be evicted.
And that's why they're doing that.
Another one is the, I know my credit's bad, but can I pay you six months up front?
Okay.
Okay.
So let's say you go with that.
I think we've done that before.
And it ended up, yeah, it's still, yeah.
Like, what happens at month seven?
What happens then?
I remember, I think we accepted that with one person and then they started having trouble later on paying up.
Yeah, yeah.
So, so, yeah.
So not to say that that can't be, but if you're going to accept upfront pay, you're going to want to do it for the whole, for the entire lease.
Yeah.
So we learned our lesson on that one.
That was a popular house, right?
If I'm not mistaken, did she pay six months up front?
But actually, no, but to be quite honest, she's actually been pretty good.
She just went over a year a few months ago and she's been very creditable.
Yes, that's a whole other one.
I think she paid a bunch upfront.
Yeah, yeah.
And that's a whole other thing.
She gave like three or six months up front.
We brought her in.
And then after that, she basically didn't pay.
And this was another high earner.
This was a six-figure earner.
And she still didn't pay the rent and all this other stuff.
No, yeah, absolutely.
But yeah, there's that.
There's the.
So six months up front, avoid those people.
Try to get it a year, right?
No, no, yeah.
Well, well, the thing with that is usually when they're coming with that, it's they wouldn't qualify otherwise, right?
So I would say don't get greedy.
Don't just see the dollar signs because, okay, six months.
Unless, of course, you're going to do a six-month lease, which I guess is fine.
Yeah.
But yeah, you don't want to get yourself into a spot where you took this money up front and then at the end of what, six months, then the person's having issues.
Now you got to go through the time and the money to evict them.
Yep.
Then you got to do a make ready.
Money up front could lead to headaches later.
Yeah.
No, no, absolutely.
So I think a good tip, and I think we learned our lesson from this.
If you're going to take an upfront payment, make sure it matches the lease.
No, no, yeah, that's what I'm saying.
Absolutely.
Absolutely.
I think our mistake was, I think we took like three or six months, but we had a year lease.
You got to do it.
Like, you want to pay up front?
That only covers for what it is.
Yep.
Yep.
But hey, like, a lot of people don't realize this.
Like, Myron's a pretty cool dude.
Like, Myron tries to work with people and he relates.
And believe it or not, he, yeah, he actually tries to give people chances.
Unfortunately, a lot of times those blow up.
Dude, I give him so many chances, bro.
But it is what it is.
So let's recap real quick because I think we're midway through.
And then do we have questions or anything right now or no?
No.
No?
Okay.
One?
Okay, let's answer it real quick.
Kay Finish Champ says, hey, Myron, been a while.
Quick question got fired from my job.
I have four months of savings.
Should I go all into my business?
I made $400 today.
Forever grateful.
And you made me budget just in time.
My rent's $1,300.
I'm 22 years old, online personal trainer.
I would say, bro, obviously go all in on your business, but get a job on the side so that you're still getting income, dude.
Like, I don't care if you got a drive over some shit like that.
Pick something up that's going to be more flexible where that you can, when you're not doing the personal training stuff, you can have some guaranteed money coming on the side.
It's going to suck for a few months, but you definitely want to have some stable income coming in no matter what as you build your business.
And it's going to suck because you're going to have to work basically work two full-time jobs almost.
But that's going to give you a level of security where your essentials are handled while you build your stuff up.
Anything else?
Okay.
So yeah, let's recap real quick.
So we can go from number one and work our way backwards.
Yeah.
So number one, have a goal.
Number two, decide on your strategy as far as how you're going to acquire the house, if you're going to live in the house or if you're just going to not live in the house or if you're going to live in the house for a year and then rent it out.
Number three, location, location, location.
Definitely take into account where to buy, how close is it to a major economic center, how close it is to food, shopping, entertainment, et cetera.
Understand financing that the terms of a loan are just as important, if not more important, than the actual type of loan.
Your income and expenses, you really have to understand that going in.
And even when you start off, you also have to keep your eye on it because that most likely will change over time.
How much money do you think they should have in reserves by the time they close on the house?
Rule of thumb is that you need what?
I think I want to say 5% of the purchase price on the side.
Okay.
So that's a good rule of thumb.
Let's say $100,000 house.
Or actually, I should say maybe 5% to 10% of what you think you're going to take.
Or another way to look at it, yeah, 5-10% of gross rents, you should definitely either put that aside or have that already going in.
Okay.
Yeah, because that, yeah.
Okay.
5 to 10% of gross rent.
Yeah.
Okay.
So like if they're, if rent's $1,000, 10% of that.
Yeah, you should either put that away or already have that.
Oh, I see what you're saying.
When you're collecting rent, you should be putting that away for reserves.
I see what you're saying.
But when they close, how much should they have?
Like total.
I see what you're saying.
Put money away.
5,000.
Yeah, if possible, yeah, I would say, I mean, I know this might not be realistic, but if you could, 5% of the purchase price.
Okay.
So you got $100,000 house, you close, have $5,000 on the side for the house in particular.
Yeah, just in case something happens because it, because that's another thing, too, right?
Yeah, roofs and shit like that.
Well, not even roofs.
Like in Florida, guess what, guys?
It's hot.
So when you have senior citizens that you're renting to and they call you and they're like, oh, my AC is out.
That is a fucking thing.
No, you're good.
No, no, you're good.
That's where that is an emergency because the last thing you want is for them to have some type of health issue because it was like 100 degrees in their unit, right?
So that has to be dealt with.
And if it, and if it's a situation where there's a major fix on the AC, like that's not, that's not something you could put.
You have to deal with that immediately.
Or if their stove doesn't work, which, by the way, guys, AC not working, water, some type of plumbing issue that makes the water not run, not providing a stove or a fridge.
These are things that are considered unlivable that if you do not fix within a certain allotted time, you can have serious issues with the city or the county, as in fines, et cetera, et cetera.
And they can not pay you rent and be fine, right?
Well, there's a process they would have to go through to get to that point.
But the point is, you don't want it to get to that point, is what I'm saying.
Yeah.
So definitely.
And then one number, what now?
What's we're on seven?
Yeah, we're on seven, which kind of goes into what I was just saying.
You've got to be aware of and comply with local landlord-tenant laws and regulations.
Because if you don't, it could come back and bite you in the butt big time.
So what do I mean by this?
Obviously, their fair housing laws is probably one of the biggest ones.
You can't discriminate people just because they're a certain race, religion, or sexual orientation, or family structure.
Just don't get caught, guys.
I'm just kidding.
Yeah, just, I mean, yeah, but that's that's a big one.
Um, obviously, paperwork, et cetera, et cetera.
I strongly encourage everyone to have a lease.
Um, and yeah, like even things like take taking in security deposits, there are laws and rules regarding how you keep security deposits, how well, how you should maintain security deposits when the tenants are in the unit.
And there are also laws governing when someone leaves.
If you intend on keeping that security deposit, you have to make a claim in writing, et cetera, et cetera.
You should be aware of all these.
By the way, there's a new law that just started this year where if someone is renting from you, you have to give them a flood disclosure in the sense that if Florida wide or Miami, yeah, yeah, it's Florida-wide.
So you have to disclose to them, you know, in writing, even if you've never been flooded out, that you know, this place has been flooded, has not been flooded.
And if you don't, and they're later.
Flood Disclosures Required00:13:12
So you have to give them like the flood facts.
Yeah.
So if you have been flooded before, you have to disclose that.
No, absolutely.
And you have to do it in writing.
And if you don't, and let's say your place gets flooded out again and their property is damaged, they could hold you accountable for that.
So the owner has to tell the tenant that.
Yes.
In writing.
That's been flooded before.
Yeah.
Well, it just, it's a flood disclosure.
If it has been flooded, yes.
Or if it either way, if you're like is that for mold?
Like, is there a particular reason why?
No, I guess I'm not sure the logic.
I guess what they're saying is if your property is in a high-risk flood area, I guess the intent is to notify the tenants so they're aware of that.
Gotcha.
Okay.
And if you don't disclose that and there is a flood and their stuff is damaged, the landlord could potentially be held liable.
Gotcha.
Okay.
Okay.
And then what other big ones?
I mean, I guess those are the main things.
Like I said, and obviously this is going to value the state.
Go off of exactly.
I was going to say that's this is important stuff.
Like if you live in a tornado area, right?
An area prone to natural problems or disasters.
There's more than likely going to be some type of law in your state or area where you might have to disclose certain things or have certain things in place.
So obviously check what your local law to make sure that you're complying with everything as a landlord.
But yeah, here in Florida, I guess we have a flood thing.
I'm sure there's probably hurricane and tornado stuff in Texas and Oklahoma.
So yeah.
Oh, and here's a couple examples just to share with you guys.
And I actually down here as well.
So when it comes to something as simple as raising the rent, like in Florida, specifically Broward County and Miami-Dade County, not sure about the other counties, but you have to give them 60 days' notice before you raise the rent.
Okay.
Right.
Yeah.
And, you know, some other states, they have these disclosures.
Some states even have limits on how much you could raise the rent, et cetera, et cetera.
If you don't follow these and someone challenges you, yeah, you get yourself in trouble.
So that's what I mean by definitely keep in touch and keep track of local laws and regulations.
Next, number eight, decide whether you want to self-manage or hire a property manager.
If you're doing one or two properties, or even depending on what your schedule, maybe up to four, probably can self-manage as long as you're responsible.
And like I said, you're keeping up to date on things.
And that'll probably be your full-time job at that point if you got four, right?
No, you could, I think you could, I mean, if you have good properties, they're well maintained.
I think it's do it.
Like, I actually have a client.
Yeah.
I mean, he has one, two, three.
I think he has about four duplexes and he self-manages.
So he's still doing pretty good.
But now obviously it's got to be close to you.
We got to be in state.
Yeah.
Absolutely.
And then it all depends.
Like if you're a guy working 60, 70 hours a week, that may not be realistic, right?
Or if you're someone that does not want to talk to someone at 8 p.m. or on the weekends to try to get something done.
I mean, it all depends.
And then as far as property managers go, I mean, that could be a discussion within itself.
I would say your best bet is to join networks of real estate investors in your area and get referrals, which is how I tend to do a lot of stuff, especially with vendors, et cetera, et cetera.
But yeah.
Oh, and this goes, this kind of actually goes into note.
Number one, nine.
So a lot of people, obviously, real estate is the buying and selling, leasing of real estate.
But I would say half of real estate is building relationships.
Your best deals are probably going to come from people that you either know or people that you know lead you to deals.
The most reliable vendors are, once again, they're going to come from people that are part of real estate investor groups through your personal network that can lead you to people that they've already used for years, decades, etc.
So once again, I cannot understate this.
Real estate, half of it is building relationships.
So I wouldn't recommend anyone try to just do this on your own.
Yeah, there's a lot of resources out there, but the most important thing would be to get local resources, like real estate investors, people in the real estate business, and just leverage their experience.
And then number 10, how big do you want to scale?
Some people, one, two, three, four are fine.
Some people, 10.
Some people want hundreds.
And if you are going to scale big, I would say you definitely need to have systems in place or else it's just going to happen.
That was one of our mistakes was implementing systems too late.
And like right now, what we're doing is, as you guys know, I haven't brought a property in a little bit for a few months now.
And that's because we've been really refining and making sure the catalog, the portfolio that we have now is all like every house is profitable, fixing problems that are some of the houses have because I bought a lot of them too quickly.
And right now we're catching up and dealing with, okay, this house has these problems.
This house has this.
What's the performance of each house?
Opening up LLCs for each.
So I would say if we could do one thing different, it would have been like me being more organized from the beginning and making LLC for each house from the beginning, opening up a bank account from the beginning versus I'm 10 houses in, 11 houses in, and now I'm like going to the bank rushing, trying to open up bank accounts, then putting them into our database and then doing everything later, which I think now we've pretty much got a hand on it, right?
We're finally like looking at profit loss statements.
We're looking at everything and now we're getting a real bird's eye view, but it took a while to do that.
And we had to kind of like stop purchasing to assess what we have, control that, figure out where we're bleeding money, whatever, and then kind of go from there.
So right now, me and Roger have been kind of doing that where we're figuring out the performance of each house and figuring out the best way to go from here.
Nope, absolutely.
But I would say for you guys, like, don't do what I did.
Like, each house you pick up, make that LLC for it right away, make a bank account for it right away, put it into a database.
There's a couple of them that you can use that like, you know, tracks the rent where the tenants pay you through there.
So everything is tracked and managed for you versus like, you know, moving everybody over manually after the fact.
Absolutely.
Because then tenants get used to like paying you in cash and you're like, okay, now I need you to use this thing.
They're going to be like, well, why?
You know, so it's like, it's better to just get them used to having to deal with you in a certain way from the beginning versus like switching things up later.
100%, my friend.
What's next?
That's it.
That's it.
Okay.
So it's time, you know, open up for questions.
Yeah, so open it up for questions.
So again, quick little recap for you guys.
In case you guys get your questions in, and obviously this is a shorter and sweeter show.
Number one, have a goal, whether it's to have enough money coming in to pay off a specific bill or replace your income totally, right?
Have that goal from the beginning of you getting involved in real estate, guys.
If you just want some pocket change, obviously that's going to drastically differ from you want to replace your income all the way and be full-time free.
That's going to heavily dictate how aggressively or how moderate you are when it comes to investing and what type of risks you're willing to tolerate versus some risks that you're not willing to tolerate, right?
Second is decide on a strategy, right?
Do you want a house hack?
Do you want to buy as an investor?
Do you want to flip?
Do you want to fix and flip?
Do you want to do Airbnb arbitrage?
What route do you want to take based on your goals?
Three, pick your location wisely.
As you guys know, there's some real estate markets that are more favorable than others, but the real estate markets that tend to be more favorable also tend to be more expensive.
So what are you, you know, where are you going to get the most bang for your buck?
For example, Florida is a desirable area, but prices have been a little bit volatile.
They went up, then they're going down.
Right now they're on the way down.
You know, we're seeing a reset like in markets like Florida, Austin, whatever.
But the Midwest, for example, though it's cheaper, it's more stable and you might not be able to command as much rent.
So it depends on what your goal is here and understand the market.
Next, number four is financing, right?
Making sure that you get good loan terms, right?
If you're going to go ahead and get a, you know, if you're going to go and live in a house, you're obviously going to get better financing terms than if you're going to buy as an investor because you're going to have to put more money down.
Interest rate is going to be a little bit higher, et cetera.
Five is going to be understanding your potential income and your expenses.
Roger gave a rule, a rule of thumb where you want to have somewhere between 5% of purchase price set aside of the house.
So if you buy a house for $100,000, you want to have $5,000 kind of on the side to deal with any repairs or fixes.
And if you don't have that, when you collect rent, let's say you collect $1,000 a month from a tenant, put 5% to 10% of that away for that cause of having your reserves to fix things because things will break.
Learn how to screen potential tenants properly.
We talked about this in detail.
When it comes to, I guess, hierarchy of importance, credit comes first, then income, and then everything else kind of falls from there.
What would you say is like the best?
What's the credit score minimum where it's like, okay, I pretty much, once they pass this number, I'm not having issues anymore.
What's the magic number for you?
I would say 720.
720 and above is where you're pretty.
And then it depends on the class of real estate you have.
Of course.
If you're class C, then I would say 680, 650, 680.
No, let me just go.
680, you're golden.
Okay.
680 and above.
680 above for a class C unit.
Yeah.
Okay.
Now, class B probably want to be 620 and above.
Class A is, I mean, if you're lucky enough to have class, you're probably looking at 750 and above.
Oh, so let's go through real quick and explain to them what class C, class B, and class A is.
So I'm going to explain this by the type of tenant.
So class D is in an area where you probably have a very good chance of being killed or beaten to death.
And your tenants, no, this is beyond the hood.
This is your tenants are going to be basically all criminals.
And the type of people, when you ask them why they didn't, you know, knock on the door, why didn't you pay a rent?
They're going to put a gun in your face until you get the hell out of there.
Worst, the worst.
Yeah.
So St. Louis areas like that.
Extremely high crime, just distress, just complete.
Yeah.
That's a very special use case for only very experienced investors.
Class C is where working class people usually occupy those.
So think of people that are working in fast food or service industries, usually working paycheck to paycheck.
Class B tends to be your professionals.
Class B, think of like policemen, firemen, nurses.
And then class A are basically people that have enough money to go out and buy a house and they have really good credit, but they decide to rent.
So think of doctors, lawyers, IT people, et cetera, et cetera.
So that's the main difference.
Oh, I should also say that those are the people, but class A are going to have the best amenities.
They're going to have gyms, you know, a guy at the front desk, swimming pools, yada, yada, yada.
We're getting into luxury at that point.
Yeah, there you go.
Yeah.
Class B is going to be a step below that.
Maybe not as much amenities.
Class C tends to have no amenities other than the basic stuff.
And then, like I said, class D is just.
Yeah.
You're surprised people are living in like a building that looks like it's going to collapse.
Yeah.
So, yeah.
So, okay, so you would say 680 and above is where you're good for class CNO.
Yeah, yeah, I would say 680.
That's fair, yeah.
Okay.
Yeah, so definitely, you know, guys, 680 and above for credit score.
And then obviously, depending on the class that you have of type of people, but I would say most the best to invest is probably C and B, I would assume.
Yes.
CNB is what, and that's the majority of my real estate, too.
Yeah.
Because A, now you're getting into luxury.
We're talking about, you know, condominiums.
So here's the thing with A.
A, I mean, that's Airbnb type shit.
If you buy A, less headaches, tends to be newer.
But the people at the same token, you got to be on it because they're paying a lot.
They're going to expect everything to be fine.
And if something's not fine, they expect to be fixed immediately.
But then here's the problem.
If there's an economic shock or if there's fear, like if their buddies start losing, they're going to drop the B in a heartbeat.
Top Tips for Buying Mobile Homes00:16:05
Yep.
Yep.
Right.
Yep.
So yeah, that's the only problem with A.
And then C, C is great.
And C is probably the class that has the biggest potential for appreciation because a lot of times C neighborhoods turn into B. Gentrification.
Yeah.
Yep.
So.
Okay.
So yeah, learn how to screen potential tenants.
Next, number seven, be aware and comply with local landlord tenant laws, right?
For example, with Florida, you know, you got to give them a flood, declare to tell them if the place has been flooded before, whatever.
So check in your local area with your ordinances and laws.
Eight is decide whether you will self-manage or hire a property manager.
You set up until four if you live in the area.
It tends to be, could be potentially manageable.
I mean, it depends on the person.
But it depends on the person.
Yeah.
If you're that type of person, you're handy, you know, you don't have any issues fixing stuff.
And if you're working, you're not that busy or like I said, or you don't mind people calling you at certain times, complaining, et cetera, et cetera.
Yep.
Nine is build relationships to get deals.
And then 10 will be how big do you want to scale, right?
Do you want to have a 50-door portfolio?
Do you want to have a five-door portfolio?
Do you want to have a two-door portfolio where you're just trying to get your housing paid by yourself?
So that's what it really comes down to.
So we can read some of these chats and then we can kind of get ready to close out here soon.
Short and sweet, guys.
But get your questions in now, guys, because I got Roger here.
He has wealth of knowledge.
He's been managing my properties, well, which is, well, we're sitting at 20-something.
And then how many of them are in Florida?
Like four or five of them are here in Florida.
And then we got like four in Florida and the restaurant in Connecticut.
Yeah.
And then, but you still oversee those two with as far as the books and the numbers.
What's up next here?
Sorry.
So OSS Africa says, I just want to show love.
I'm investing in Africa.
We don't know credits here.
And I'm so happy for the amount of gold information you're giving here.
W show.
Appreciate you, OSS Africa.
I want to get into real estate from Greg.
How do I go about finding a good mentor who can help me in the beginning as someone who doesn't have connections in the industry?
It depends.
Are you trying to get in as an investor?
Are you trying to get in as a fixture on Flipboard?
Are you trying to get in as a real estate agent?
Are you trying to do Airbnb arbitrage?
It depends on what you're trying to do because as a developer, there's so many different realms within real estate that you can kind of get into.
Do you want to be a broker like Roger, who, you know, you went from a real estate agent to like now you have a brokerage where you basically run a management business for people, right?
So it depends on what you want to do, but there's so many different avenues you can go.
I mean, I would advise Greg to look up, just type in real estate investor club and then the city or the county you're in and see what pops up and start going, you know, reaching out, connecting with them.
FYI, treat it like dating.
Some of these groups may not be what you're looking for.
So it might take a few times of you going out and checking them out.
Also, Meetup, meetup.com is another one that you may be able to find some good real estate groups.
Also, they got groups on Facebook.
Just be wary of the ones that are just trying to get you in the doors so they could upsell you.
Okay.
What else do we got here?
Buying a house with an LLC, can you do that with a starter home or is it better later on?
The answer to that question is it depends on what state you are.
And that is a lawyer question.
So I would, yeah.
So there's a bunch of variables that buying it and then turning it into an LLC is easier because you have the property in hand.
Now you can do that.
Some people will try to buy the property under an LLC, but then let's say you don't close the deal.
You just made an LLC for no reason.
So it's like, you know, there's different ways to go about it.
But I've noticed you just get better terms when you buy it under your name, then you can switch it later.
But make sure that your bank doesn't get mad at you for doing that, right?
Like make sure that you're not violating the terms of the financing by doing that.
But I don't think most of them care, right?
Like switching to an LLC from a, you know, once you purchase the property as an investment, I mean, that's foreseeable.
If you're pointing 20% down as an investor, that you more than likely will go ahead and make it into an LLC at some point.
I mean, obviously, if it's an investment property, that's one thing.
If it's your primary house, dude, that's different.
That's why I say that.
Ask if you're buying it as like a primary residence.
That's where I would say inquire with a lawyer where you're at.
And there are differences from state to state about that.
Absolutely.
Absolutely.
So yeah, that's definitely get with a lawyer on that one just to be sure.
But yes, what I've noticed for me personally, buying it under your personal name and then switching it to an LLC later tends to be easier.
You get better terms.
Just make sure that that's acceptable where you're at.
But good question, DC.
Fresh as Asian says, hey, what do you think of real estate in Michigan?
And do you have any properties in Michigan?
I don't.
I don't have any properties in the Midwest, but I have heard good things about Illinois and Indiana.
Michigan, I've heard some problems.
I've heard a couple of real estate investors complain about Michigan that apparently there's really bad squatter laws that benefit squatters and not landlords.
But that's, I don't know specifically.
Because even in a troublesome market, you can still find good deals.
But yeah.
Hey, bro, my wife has a 680 credit score and I have a 645.
I have 10K saved up.
We want to get our first home.
What credit score do we need?
How much do we need?
And how do we start the process?
Okay.
So for FHA, I believe your credit score is high enough to get started.
Don't know what your incomes are.
But yeah, I mean, you could start off where he lives.
Yeah.
10K, you might be able to do something in the Midwest.
10K in Florida, they're going to lie for you.
You know what I mean?
You won't be able to do anything.
So we also need to know how much you earn and where you're looking to buy.
But either way, I would say start off at your local bank and talk to them and see what they're talking about.
I mean, it's not going to cost you anything.
Yeah.
But yeah, definitely you want to get pre-approved.
I think that's important.
Yeah.
Right.
Before you even start house hunting.
One of the biggest mistakes people make is they start looking at houses without being pre-approved.
And the problem with that is you won't know what range that you can afford.
So get pre-approved first, guys, in your house journey.
Who's up next?
Okay, Egyptian.
Wait, Egyptian Menace says, 200K saved.
I'm 21.
I want to buy a home and house hack.
I live right outside San Jose.
I can land a 700 to 800K home close to the area, three to four bedroom.
How much money should I have saved after the down payment before I pull the trigger on a deal?
Well, like we said before, you want about 5% of the purchase price sitting to the side.
So for easy numbers purposes, let's say you buy a house for $100,000, even though we know you won't get that in San Jose.
But let's say hypothetically you bought a house for $100,000.
You want roughly around $5,000 sitting around in reserves for repairs or anything else you need like that.
Now, when it comes to you buying a, you have 200K saved, you're in San Jose.
That's crazy that a three to four bedroom costs 700 to 800K there.
Oh my God.
That's really expensive.
But it's Southern California, right?
Yeah, dude, I would say, you know.
Can we get a Don DeMarco?
He's 21.
Yeah, 212K.
Yeah, that's good.
And he's a member of Castle Club, which makes sense.
Dude, I would say if I had that kind of money saved, dude, I wouldn't get a single family home.
I would try to get a duplex, a triplex, or a fourplex, man.
Like, I think house hacking is most effective when you have multiple tenants.
That's where you really get the bang for your buck because you can get the single family house and then rent it later, but why do that when you can just try to get yourself a fourplex or a triplex or a duplex at least and have some of that rent offset?
Yeah, I mean, I agree with what Myron is saying.
Think of it this way.
If you could get a triplex or a fourplex, even if you're getting on under terms that require you to live for a year, you could do that, move out after the year.
Now you have three to four units paying money in.
Now you could get that $700 to $800,000 house easier.
And also keep in mind, bro, when you house hack with like, let's say, for example, you're looking at a house, a duplex or a triplex for a million dollars.
Well, you have 200K saved, right?
So you can easily get control of that property because you're only putting 3% to 5% down versus buying as an investor, you got to put 20% down.
So I would say try to find a duplex, triplex, or fourplex, bro.
So you can get away with putting as lease down as possible and have your tenants offset that high mortgage that's going to come your way.
Because the important thing is to close the deal and control the asset.
And you just got to live in it for a year.
So that's what I would say.
I think that's the move.
Yeah, it's going to suck.
Got to deal with tenants and live next to these guys for a year, but I think controlling the asset is good.
But also keep in mind, California, you know, do you want to, if you really got to live in California, I guess, but I always tell people get out of California if you can.
But everyone's different.
Who's up next?
Does he know anything about mobile homes, selling slash renting out?
Actually, I do.
What do you need to want?
What do you want to know about mobile homes?
Yeah.
This is one of Waller's expertise, too, is mobile homes and trailers and stuff.
That's a whole other game.
I mean, it's a great deal.
Basically, you have a piece of land.
The mobile home is attached to these little lots, and they're basically renting the mobile home from you.
And you're not really paying for anything.
They're just paying you rent, and you just do the common area stuff.
I mean, per square foot, it's a pretty good deal, but I don't know how he means.
Does he mean purchasing?
I guess he means buying mobiles to rent them out.
As long as you're buying at the right price, which means that, once again, 1% rule on your purchase, your purchase.
Can you explain something to the 1% rule?
Yeah.
So the rent should be no, the rent should be 1% of the purchase price or better.
So if you buy a house for $100,000, you should be trying to get, collect $1,000.
Yeah, at least $1,000 a month rent.
So that's the quick way to figure out if it cash flows or not.
But yeah.
Or try to be as close to it as possible.
Like realistically, are you going to have a 1% rule in a hot real estate market?
No.
But you want to be as close as possible to that 1%.
And since you asked that question, I actually do know someone that does this.
And what she does is she finds not one, but let's say five, six, 10 mobile homes that are like messed up.
Because they're messed up, she buys them at a discount.
She fixes them up, then she rents them out.
And usually, because she bought them at such a great price, she makes some really good cash flow from that.
Okay.
Anybody else?
Okay, He Don't Love You says, Do properties rent out quicker if they're furnished versus non-furnished?
I would say it depends.
Furnished, you'll probably get it pretty.
And you could charge a little bit more too.
Yeah, with the furniture.
They're going to fuck your shut up.
Well, see, that's the thing.
It really depends, right?
Like in an area, like in a brickle area, right?
I can make the argument that, yeah, depending on the length of the lease, what's going on, you potentially could.
But from my experience, most people usually have their own stuff that they want to bring in.
So I would say you really need to know your market.
But if I had to, I personally would go with unfurnished, unless, of course, you're trying to do medium-term rentals or if you're trying to rent out to like nurses or people that are going to be there for like four, five, six months, etc.
In that case, then yes, you would want to basically be furnished.
Or if you're doing short-term rentals, right?
And that would be like an A-class property that we discussed before because these people are going to be more than likely to care about the stuff, not destroy it, whatever.
But doing furnace and like a lower and like a lower-class thing, they're going to destroy your stuff.
Yep.
Okay.
All right, next one.
Who's up next?
Okay.
Talk about your commercial deal.
Shit.
Do we have the do we have the stuff to sell?
That was the one in Connecticut, I think I did.
Yeah, the six-unit.
Let's get back to that.
Yeah, that one, yeah.
Yeah, that one is a bit.
I'd have to pull all the paperwork for that one.
Yeah.
Top Shay.
Hello, Roger.
Welcome to FNF.
Use myself.
For example, I just recently started my business last year as a side gig, now potentially on my own, and I wanted to buy a home.
What are the following?
I'm a little confused, Topshay, about what you're saying.
I mean, I assume you're asking what you need to buy a home.
The first thing I would tell you is, I assume you have a bank.
Go to your bank, talk to the loan department and see what you qualify for.
And that would be the first step.
The second step, I would say, is find yourself a good mortgage broker and see if he can do better than your bank and just have them kind of fight against each other.
But yeah, you need to know how much house you can buy before you can do it.
Pre-approval is guys, literally required because that's going to dictate what houses you can look at and which ones you can't.
And then honestly, don't go for the house that you're like, you're just barely qualifying for.
Like if you get a pre-approved for a $500,000 home, you'd probably want to try to get something in the $300 to $400 range.
You know, you want to give yourself a significant amount of wiggle room for affordability.
You don't want to be maxing out.
You don't want that.
Yeah, let's go.
Which a lot of people tend to do.
Live below your means, people.
Absolutely.
Part two.
What can 40K plus do for the start to own a home, meanwhile being self-employed?
So top chewy.
Or top shea.
Oh, top shea?
All right.
I mean, that really depends on where you are, how much you make some of it.
I mean, there's a lot of information I would need to even begin.
Like 40k plus market.
I don't know what market you're in, my friend.
And I also don't know how much you make being self-employed.
But once again, I would say go talk to the loan officer at your bank and they'll be able to answer those questions.
Check, can you write a question?
Like, put it all out there, like in one, you know, concise manner.
Because we're not really tracking too much with what you're specific because, like, you're kind of throwing a bunch of things.
So, just ask one question that's clear that we can answer because I'm confused by your two messages here.
Because you're saying, what can 40K plus do?
Is that from your side business?
Is that gross income?
Is that just you know, um, what you earn?
Like, we need to know.
I guess he has 40k.
I guess he has that for a down payment.
So, the all right.
So, there's really two ways you're going to get loans if you're going through a bank, and that's going to be FHA, which you need five percent down.
Message in and clarify for us, bro, just in case, but go ahead, yeah, or a conventional loan, which means you need 20% down.
And then, and then, so then the question becomes: well, what do the average homes in your area go for?
And then figure out, well, what would be 20% or 5% of that?
And then that tells you how much you need for a down payment in it.
But then you could factor in another 3% to 5% and closing costs and other expenses on top of that.
So, all right.
Uh, who's up next?
Midterm Rentals & Pad Split00:02:02
Chug says, uh, what are both of your thoughts on midterm rentals?
Like, pad split?
AI says the best strategy for me to cash flow my home.
Okay, so you said two things there that actually conflict: midterm rentals and pad split usually don't go hand in hand.
If you're thinking midterm rentals, which are usually around six months, eight months, stuff like that, where you want to check out is Furnish Finder.
This is where, by the way, that's where the furnish units would come in.
And one of the best sources of midterm rentals is if you have a property that's near what's known as a teaching hospital, which means you have a lot of doctors and nurses that are coming through on a regular basis for anywhere from four to six to eight months because they're learning or they're teaching some type of program.
And they tend A to pay a premium, and then B, they're going to want a really nice furnished apartment because obviously doctors and nurses work really long hours.
But pad split, like I said, it's more for people renting rooms.
At least that's what's the people I know that use that.
That's what they told me.
So, um, but as far as the best strategy for you to cash flow your home, I mean, I don't know what the setup on your home is.
If you're talking about renting out rooms, I don't know if you have a main house and then a basement, if you have an accessory dwelling unit in the back.
I mean, it really all depends.
So, Chug, do you want to give us an example of the layout of the property that you're talking about?
so I'd be able to give you a little bit more better advice any advice in Canada or should I already have 230 on it Any advice investing real estate in Canada?
Investing Real Estate in Canada?00:09:17
Get out of Canada.
I mean, get out of Canada, bro.
That's that's that's the best advice we could give you.
I mean, but see, this is a perfect example.
I already have home network, but I hope, but now my question would be: okay, this is this is the way you should evaluate this.
You should really look at what are your expenses in Canada, right, versus how much money you could potentially make renting it out versus taking that same equity in cash and doing it.
I mean, you say the states, the states is a very big place.
I don't know where specifically in the States, but I would say make that analysis and use that to be the basis of your decision.
You should look at, like I said, potential income, what your expenses are, what your cash flow is in Canada versus taking the cash and the equity and bringing it to the states.
And then whichever one is better, I would say go with that.
Martin, what's the best asset protection to shield yourself from lawsuits?
I'm stuck in NYC due to work, and NYC doesn't offer a lot of asset protection, even with LLC and a revocable, irrevocable trust.
Good question.
I know we had discussed this before with Umbrella, right?
Yeah, actually, there you go.
That's the easiest one: umbrella insurance.
If you don't know what umbrella insurance is, it's exactly what it sounds like.
If you have any other type of insurance that you are at fault and you get sued, umbrella insurance kicks in after that is exhausted.
That goes for car insurance.
That goes for property insurance, personal liability, et cetera, et cetera.
And you can get umbrella insurance through most of your car insurance companies.
The only problem is they may require you to have a bit higher protection on your car insurance before they will extend the umbrella insurance.
All right, who's up next?
When it comes to your, I'm a 24 PNT veteran in Houston, $3,900 a month tax-free, and I'm currently using VR and E to get my CDL for trucking.
My plan is to go OTR for a year, save up 50K, crush that, max out my Roth IRA, and then use my VA loan to buy, I think, a Foreplex.
My thing is blocking it, but with 0% down tips.
I mean, what do you think?
I think that's like a pretty solid plan.
Okay.
So, although I'm a veteran, I'm not 100% sure, which I guess I'm not.
I want to say I should know what PNT means, but I assume you mean it sounds like you might be 100% disabled through the VA, which, if that's the case, the first thing I want to tell you is that you are, I want to, I say I believe in Texas, you are 100% exempt from property taxes.
Please double check that.
I know that is the case in Florida.
You absolutely should look into the VA loan.
And yeah, you can buy a triplex of Fourplex.
Here's something else a lot of veterans do not know.
Just keep in mind, it's going to be expensive monthly.
It's going to be, you're going to pay PMI.
You're going to pay a high.
No, no, no, I'm not with the VA loan.
Oh, they don't got to pay PMI?
No.
With VA?
That's good.
All right.
So, oh, so another thing, too, you can use the VA loan to build a property.
So if you know of an area that would work for a nice triplex or fourplex, you can literally use the VA loan.
They will do a construction loan for you and build that property.
That's good.
So damn, it was a zero money loan down.
Okay, Anonymous says, I'm Arnon Roger.
Thanks to your guys' advice, I closed on my first apartment last week.
No financing, 73K.
I think it means a condo then.
Looking for some tax tips.
Should I do a cost segregation study to get XL depreciation?
But if I sell soon, would it cost more to pay that deduction back?
Well, why would you sell, bro?
You know, you don't want to like you, the goal here is to like not sell if you can.
Part two is continued.
I won't be able to use the paper loss against my active income, right?
I have a non-real estate FT job making 100K a year.
Thanks, guys.
That is an accountant question, my friend.
Yeah.
And then also, like, why would you buy the house to try to first, you said you close on your apartment, so I'm assuming you really mean a condominium.
And then you didn't finance it.
You paid 73K cash, it looks like, and you're looking for some tax tips.
You could do cost sag.
I think what he's saying, right?
I know what he's saying.
He's saying, like, obviously, if he does accelerated depreciation, he would have to hold it not soon, but for 27 and a half years.
I was going to say, yeah, 27.
Yeah, it's going to depreciate at that level.
So if he sells it anytime before that, then yeah, he ends up paying that money he got back for the call set.
Yeah, he's going to have to, because he didn't hold it for the full term.
But like you said, look, one thing I'll tell you guys, I know a whole bunch of people that have regretted selling properties.
I don't know anyone that's regretted holding them.
Yeah.
So I would strongly advise you guys to really think about something unless unless you just have a total lemon that's just costing you ridiculous money every year.
Yeah.
And a lot of the times it's easier to hold and find ways to cut costs than to, you know, I mean, you could go ahead and sell it, but like a lot of times you're going to, depending on what it is, and then it's a condo.
Condos are hard to sell, dude.
You know, that's why I tell you guys all the time, I've said this for years, guys, don't buy condos.
I bought a condo because I'm in a very unique situation where we're doing a show here and everything else like that.
It makes sense.
But in a lot of situations, guys, condos like don't make sense from a, you know, investor perspective for most people outside of extraordinary examples of like what we got here.
Who's up next?
Hire Seja?
These are really good questions, by the ways, guys.
I want to open my own property management business.
What should I learn so that when I open it, I'm ready for the most part?
This is a perfect question for you.
That's what you did.
Okay.
So in most states, they require you to be a real estate broker or to have some type of licensing.
I don't know what state you're in.
So there most likely will be a licensing requirement.
But in lieu of that, or while you're working on that, I would say go work for a property management company that manages the types of properties that you would like to manage so you could learn the business.
All right.
We got up next.
Martin, I'm in Sri Lanka living in Australia.
I want to make sure to start a credit file in the U.S. and get into investing by 2020.
I've opened up LLC, got my ENN, EIN, and working on getting the ITN and getting a credit card.
What advice do you have for me?
Well, how are you going to come to the United States?
Are you going to come here?
Are you an Australian citizen?
Are you a Sri Lankan citizen?
Which one are you?
And then as far as like you coming here, are you going to get like an what kind of visa are you going to get?
Like there's more.
So I think what he's thinking about is him buying property here and then living abroad.
And still living abroad, yeah, which he can do.
Yeah, but he's probably not going to be open to certain financing options, right?
Is he open to a U.S. citizen?
He's probably going to have to come out with way more money cash.
Yeah, but yeah, he's going to need to talk to a mortgage broker.
I mean, I've worked with mortgage brokers where they're like certain, there are certain products for people that are non-U.S. residents to buy.
But like a typical convention and 30-year fix is probably not going to be available to him, I'm assuming.
No, I mean, it will be just higher interest rates or more money down, et cetera, et cetera.
Okay.
But yeah, that makes a big difference, bro.
Are you Sri Lankan?
Are you Australian?
Right.
You know, obviously as an Australian, you can come here and visit whenever, right?
You don't need a visa, but as a Sri Lankan, you do.
I'm not exactly sure.
And then, do you plan to buy it and then, like, just live abroad and collect from it?
Is that what you plan to do?
Because that's going to obviously change things a lot too.
Guys, try to give us as much information as you can, like how much you earn, where you live, because that will heavily dictate what we can, you know, how we would dispense advice to you.
Thank you, Myron.
I don't think you get a lot of praise.
Definitely helped me a lot.
I went through a lot, but watching your videos gave me hope and made me a better man for my sibling.
Thank you.
I don't know where I would be without your help.
COVID time, wish me luck.
Want to make 5K next month?
Should be possible working 16 hours a day.
Absolutely, bro.
100%.
Absolutely.
That's completely feasible.
You should be making more if you're working that much.
Investing in Georgia Towns00:10:38
Malarkey says: 21-year-old college senior real estate major want to save to invest.
What should be my primary focus besides saving and what kind of jobs should I look for to learn real estate game?
Coastal North Carolina will be at with UA at USC next week, Myron.
Okay, so 21-year-old college senior real estate major want to invest.
What should be my okay?
The additional thing you should be doing besides saving is building relationships.
If you're a senior real estate major, you should definitely be talking to your professors.
Any clubs, associations, et cetera, et cetera.
You should definitely leverage your relationship with your professors and get them to introduce you to people or point you in the right direction in your local area regarding people that you could potentially get mentorship from.
And then, and as far as where, what type of jobs you should look for, I mean, it all depends on what you're trying to do.
I mean, you could go work for a big property management company.
You could go work for a developer.
You could decide that you want to be a real estate agent.
It really depends on what it is you're trying to do and what your interests are.
Okay.
Who's up next?
Yeah, we got that one from Shay.
When it comes to your utilities, should the tenants pay for the utilities?
Good question.
So the answer to that question is it all depends.
So in a single, if you're renting out single families, typically the tenant pays for everything, right?
If you're talking about a multi-unit, like a duplex, triplex, quadplex, here in South Florida, we have some that are separately metered and we have some that only have one meter.
The ones that are one metered, it becomes a little bit more difficult for you to figure out how to charge each tenant what they're actually utilizing, which is why most of the time the landlords just pay for that.
But then they just add that, not necessarily add that, they account that in the rent pricing, right?
Whereas the ones that are individually metered, obviously easier for the landlord.
And once again, you account for that in the rent price.
I'll find more?
Okay.
Good questions, guys.
Part three.
Sorry, guys, driving.
I've been up.
I've saved up 40,000 looking to buy.
I live in St. Lucie County.
So he's here in Florida.
Looking at houses that ranges from 350 to 400K.
Business has made over 100K.
What are my options for pre-approval?
Okay, so that's definitely a bit more information.
So we saved up 40, he makes 100.
He'll probably easily get pre-approved for 500 to 600K.
Yeah, yeah, actually, he, yeah, he could potentially get something.
Yeah.
All right.
What are your options for pre-approval?
Just like I was saying to everyone else, yeah, check with your bank first, see what they have to say, then see if you could find a good mortgage broker and just see what in a six like 680 and above, you'll probably get pre-approved for like 500 to 600K.
Yeah, but yeah, you're making good money.
You got a decent amount saved.
Yeah, you definitely can get something.
Yeah, absolutely.
Absolutely get something.
And houses in Port St. Lucie are staying on the market, having on the market for a while.
Oh, so it's a good market for him, right?
Yeah, potentially, yeah.
You'd probably get something for a good price.
Yeah, the Florida market is definitely cooling off, guys.
Austin and Florida have absolutely cooled off.
So it is a little bit more of a buyer's market versus a seller's market like it was a couple of years ago.
I remember two, three years ago is fucking insane.
People were paying $1,500,000 over stubborn sellers.
Yeah, yeah.
because they paid so much for it in 2022 they want to they want to sell it for the same thing so don't lose a before i remember people overpaying 100 to 200 000 over asking man It was crazy.
Who's up next?
How to look for good home insurance?
Good question.
That's something that we've dealt with.
Because if you don't have home insurance, the mortgage company is going to put one on.
It's going to charge you a lot, which we're dealing with right now.
I hope you're not in Florida.
Yeah, I mean, this really all depends on where you're based.
And yeah, I'd recommend look for a good insurance broker that could help you out.
And that's all I got on that one.
Okay.
It's a five-bedroom, three and a half bath.
It has a basement, but because the basement doesn't have direct access outside, I have been told it alone can't be a rental space, no ADU, no, or a DADU.
Okay, so then I guess you're talking about potentially renting out some rooms.
But let me ask you this with the bedroom.
You know, assuming that it's, I mean, the basement, assuming that it's legal for you to rent it out, how much would it cost for you to put direct access?
Because I got to think that your basement has way more square footage than like your combined bedroom space, right?
I mean, obviously, I assume you're living in at least one of the bedrooms.
So I would say maybe something that you might want to look into.
But if not, then I guess pad split.
I live in NYC with a city job grossing between $140,000 to $170,000 annually.
I want to purchase my first investment property.
Is it wise to pull the money out of my $4,000 $57K to start as opposed to saving the cash it would take for an FHA?
Yeah, I'm not a fan of pulling money out of your retirement, bro.
I'm assuming that's like some type of 401k retirement thing because you'll have to pay it back and all this other stuff.
So I would say just save the money yourself, bro.
And if it's for FHA, you have to come with way less.
So if you can avoid pulling from it, fine.
But that's really like a case-by-case.
And do you want to, I'm assuming you're going to try to buy a property in New York, which is going to be expensive.
Yeah.
We're talking about like a million dollars for just a three-bedroom house, probably.
And NYC is like saying 60, 70 down here.
So yeah, like he's going to pay.
Yeah, he's going to pay at least.
Like, even if you want to get a house in Queens, bro, like a small three-bedroom, two baths is going to be one to two million dollars easily.
So New York City is a whole other, whole other game.
I'm grinding in a good path financially and career and life-wise with the girls.
Should I just keep them on my time?
I attract them, but I can't really go up to them because it wastes my time.
$23 in Mail and Los Angeles, $5.6K for a month.
Yeah, I mean, bro, girls are just a distraction, especially at this age for you.
Like, just focus on getting your money up, bro.
5.6K a month.
Work towards getting to 10.
That's pretty good for 23 years old, but focus on getting at 10.
That should be your next goal.
10 a month.
And women are just going to distract you.
Matt, what's the best asset protection to shield yourself from lawsuits?
I'm stuck in NYC due to work, and NYC doesn't offer a lot of asset protection, even with the LLC and a revocable, irrevocable trust.
Yeah, we did this.
Um, we did that one.
Yeah, um, what else?
And then we are going to have to close here soon, guys.
Uh, Roger goes to bed very early.
We're holding him way past his bedtime.
Yeah, I'm old.
My apologies, Myron.
I'm working on getting my AU citizenship for 2028.
With that, I'm looking at L1 business transfer visa treaty between AU and U.S. to get there.
I'm trying to make sure I can have everything going by the time, including a good credit score.
Okay, yeah, that's cool.
Yeah, I mean, you're just going to have to explore some options through a mortgage broker to get a loan.
But it's good that you're kind of already getting things going ahead of time.
So, yeah, look into the type of loans that you can get as a foreign national perfect example of how buying condos is a bad investment.
Florida, 40-year fixed, 40-year tax reassessment destroyed the condo market in Florida.
Last year, condos lost around 100 to 200K in value, plus a big property tax bill.
Yeah, I tell you guys all the time: don't buy condos, bro.
Like, they're like, outside of extraordinary situations, most of the time, buying condos is not the way to go because you're going to pay HOAs.
They're hard to sell.
Sometimes they could be a headache to deal with.
Nine out of 10 times, the only times it makes sense to buy a condo is if you're going to live in it and you're comfortable with the fact that you might very well lose some value on it.
Hey, guys, don't forget to like the video, by the way.
Smash that like button, guys.
My name is Alex.
I'm in Georgia, next to Columbus in small town.
What are your thoughts about investing in small towns in Georgia?
Family has 226 doors and 85 properties between residential, commercial, Airbnb, storage, and car wash, OSS.
Thank you, Myron.
Appreciate you, Alex.
What's your thoughts about investing in small towns in Georgia?
Family has 226 stores at 85 properties.
Holy shit, bro.
Like, I mean, dude, you got the gold, you got the fucking silver spoon in your mouth, man.
Family controls all that property.
You're probably doing really fucking well.
So he says Columbus, Georgia.
Columbus is right outside of Fort Benning, which is where I went to infantry school.
So if all of that's right there, I mean, good place to be.
Yeah, I would think so, especially in the military, yeah.
Yep, they're going to be pay their bills most of the time.
So, um, yeah, dude, that's that's a really good uh situation to be.
I don't really have much to say.
What are your thoughts about investing in small towns in Georgia?
Yeah, your family did it right.
By the way, did I mention my daughter is a real estate agent in the Atlanta metro area?
Okay, Alex, you should give me a call.
There you go.
And guys, well, what's the best way for people to contact you, by the way?
Because I know people are probably going to want to do a consultation with you or maybe go through you to find a broker or maybe honestly.
The easiest way for me is if you hit me up on email, that's roger at rogerlaçade.com.
That's roger at roger l i s is and sam s is and samad com.
Um yeah, and we could put it below.
Can we put that in the description, Mo?
Roger at rogerlaçade.com.
Yes, double S, guys.
Anybody else?
Burr Investing Prospects00:05:21
Juke, last one here.
Should you focus on stock investments when you only paid off less than 10% of your principal?
Should you focus on stocks?
Okay, so I'm going to repeat to you what Charlie Munger said.
If you still have a mortgage, you have an interest rate.
If you pay that off, that's a guaranteed return.
Whereas stocks, not guaranteed.
Yeah.
Very true.
Someone else said something here.
What is that from Streamlabs?
He says, I can't.
I can't see it.
Yeah, I can't see it.
I mean, you can read it, Bills.
Just read it for us.
Yeah.
All right, Myron.
I'm a 23-male electrician making $9K a month with $50K saved.
I'm not sure if I should just buy a multifamily home, like a duplex or a triplex, or should I try to flip houses and sell them?
Burr method.
What does he do for a living?
He's an electrician.
He's a little confused here.
Burr is not flipping houses, by the way.
Burr is buy, rehab, rent, rinse, and repeat.
And refinance.
Yeah, that's there.
You go.
That's what Burr is.
It's a lot of work, bro.
He's an electrician, so at least he's got the electricity stuff down.
But yeah, what I would recommend is that, yeah, you buy like a duplex, triplex, or quadplex, and then you house hack.
You know, I think that's the easier route over the burr because the burr, bro, you're going to buy it.
You're going to have to buy an undervalue, rehab it, fix it, which is going to be a considerable amount of work done.
That's going to increase the value.
Then you refinance because and then you pull that money out from the work that you did.
You know, I know you're an electrician.
You might be handy, but are you willing to spend all that time and or hire a team to help you with rehabbing the house?
Like, do you have that kind of time?
So that's what it really comes down to.
You said you're making $9K a month, so I'm assuming you're more than likely probably either a journeyman or past apprentice and you probably work a full-time job.
You know, maybe just, I would say, focus on your career and get a house on an FHA.
And then if you want to do a burr later on, you can, but just understand that it's not going to be as easy as people think.
Like fixing and flipping is not as easy as people try to make it seem, dude.
Yeah, so guys, very time consuming.
I'll just tell you what some hard-money lenders I know are saying that it's getting really hard.
Well, anyway, in my neck of the woods in South Florida for people to make money flipping houses.
So, and you also got to factor in that when you buy something and then the time it takes you to rehab it and flip it, like the market could change.
And yeah, which I think you're better off buying and holding that house.
And if you see an opportunity and you got a little bit of, you know, some more resources, get something else.
But yeah, I'd be very careful entering house flipping right now.
Yeah, especially when you got like a full-time job and you might not have the skill set to be able to do it, you know, right away.
So I think buying and holding on an FHA, bro, is going to be a bit safer.
Of course, there's more potential upside with Burr, but understand that it's going to be significantly more time investment on your side.
And it seems to me like you got a very promising career where you're working full-time at least.
Haitian says, I make $100K a year and experience says I have a $755 credit score, but I only have $5K in savings at the moment.
Should I save up at least $20K to cover one year's rent just in case before I buy a property?
I wanted to buy a duplex in Florida.
The answer to that is yes.
Also, no, no, let me.
Oh, there he goes.
Haitian deck, you make $100 a year.
You only have $5K saved.
What's going on there, my friend?
should i don't know if you just started making that but if you've been doing that for a year you should have way more than that saved all right Cool.
Guys, we got after ours here in about 30 minutes or so.
Roger, Roger, it's Roger at RogerLasad.com if you want to ask questions.
He uses email.
Doesn't use Instagram like a lot of you guys think he's an older guy.
Anything you want to say to the people, bro?
Last words for the people?
No, I mean, I'm on Instagram.
I'm not going to lie.
I barely check social media.
But yeah, man, I think 2026, we've got some headwinds.
We got something.
I mean, it's hard to guess what the future is going to hold, but at least I'm seeing signs that 2026 might be much better than 2025.
So definitely keep your eyes out.
Save your money, guys.
Seriously, live below your means.
Live below your means.
Live below your means.
I know some ultra-high net worth.
What is ultra-high net worth?
People with $30 plus million dollar net worths, they live like they make like $150,000 a year.
Live Below Your Means00:00:49
Well, except for their homes.
But everything else, yeah, they live like, you know, you would never guess they were that wealthy.
So yeah, guys, live below your knees, save your money, and keep learning.
Bam.
All right, guys, we'll be back in about 30 minutes or so with some after hours for you guys.
I think the girls are here.
Chris is here.
So go check out Roger.
We're going to do a Zoom call with him as well.
This went a little bit later than usual, guys.
Roger's an early riser.
So we'll get him out of here so you can go rest.
And we'll do another QA for you guys on Council Club as well, where we go into more details.
And we'll have some of my stuff out there for my deals and stuff like that.
Obviously, I can't put them on YouTube, but we'll put them on behind the behind a Zoom call for you guys.