Episode 104 – Jeremy Hans on The Military Millionaire Podcast

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Episode 104 – Jeremy Hans on The Military Millionaire Podcast

 

Jeremy Hans on The Military Millionaire Podcast

00:00 - 05:00

Intro:

You're listening to the military millionaire podcast, a show about real estate investing for the working class. Stay tuned as we explore ways to help you improve your finances, build wealth through real estate, and become a person that is worth knowing.

Sponsor:

What's up guys today I wanted to stop and sponsor my own podcast by myself, which is a little cheesy to tell you about the course that I'm launching called from zero to one real estate investing for beginners.

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It is extremely affordable right now because I'm launching it for only 97 bucks, which given the amount of content in there and the testimonials I got from the people who tested it beforehand, I am super on the low end for that price, but I'm gonna probably have to bump it up in a little while. But for now to test the waters and see exactly how many people I'm able to help with this, I want it to be extremely affordable because I want to help service members and veterans get their feet in the water.

So if you are interested in learning about rental properties, and you just want to learn how to get your first one and then there are some bonus episodes in there to help you advance past that but if you really just want to know everything you need to know to buy your first property without screwing yourself over, this is the course for you go ahead and check it out. The link will be down below in the show notes and back to your episode.

David:

What's up military millionaires, how are you today? This is gonna be a fun episode.

So we have Jeremy Hanz whose name I have mispronounced for you know ever since I've met him now in my head, who is a Nighthawk pilot for the Navy who's done active duty. Now he's in the reserves doing an IMA right.

And anyway, so he's a Nighthawk pilot flying helicopters around living life, but he's also a commercial real estate guy. So he's done a lot of deals. And he's really cool, dude. So he's in. He's in the mastermind group with us and we talk all the time. And I've been bugging him for a couple weeks now. And I also stood him up once when we had a podcast scheduled and I slept through it.

So we are back to do it again.

And Jeremy, welcome to the show, buddy.

Jeremy:

Thanks for having me. Thanks for having me.

David:

Tell us a little bit about yourself and work where you got started.

Jeremy:

Yeah, so Jerry Hanz. I grew up in Nebraska and Texas, graduated with an RTC scholarship, university Oklahoma. Nothing really magic there. Got a degree in communication. joined the Navy and wanted to fly helicopters from the beginning. was blessed enough good with a flight school. Select helicopters and then got to San Diego, flying at 60 really off the carrier Jhansi stands for a couple years.

Great time out there in that process, right? It's kind of like starting a real estate business. And really before that, right after I graduated, the military officers had the opportunity to get a career startle them. And so I got both the USA and the Navy Federal career starter loan, which I don't think are supposed to do, but one of my superpowers is reading fine print. And so I found the way to do it. So as a 22 year old, I $55,000 in debt and took all that money in late 2007 invested all in individual stocks in the stock market, and then watched 2008-2009 happen, and I successfully turned $35,000 into $15,000 had nothing to show for it but $1,000 month one payment.

So that was kind of my Kickstart to the world. And that's when I realized maybe I'm not as smart as I think I am and started looking at other options.

So my wife moved out, got married. While I'm in San Diego we spent about a year trying to find something where we could live in it and then rent out the other units and so we were looking for a duplex triplex or quad man crazy, crazy market out there. I think we had one offer for $100,000. Over asking didn't get accepted. We had the highest offer when they got accepted. We have one property out there where our offer has been accepted and then they accepted another offer at the same price. And they told us to work it out like in the sandbox and fight over it.

So that worked out either but we find that place has got a fourPlex back in 2010. Way too much money right for a 23-24 year old with a wife but worked out really well with the FHA loan out there so did that. Finding the Navy was expecting big real estate anything other than hey, just something I own.

The Navy did decide to move me to Pensacola, Florida. So I now live in Pensacola, Florida. i've been out here for about seven years. I came up here as a just a married guy hanging out going out and now have three kids. I thought My grass was my grill so I changed the lifestyle here the last few years but when I got out here got more into commercial real estate when I saw how well that four Plex is doing so I continue to do real estate but I never bought a house.

05:00 - 10:00

Jeremy:

So I got out here bought a mobile home park with a partner and bought a six Plex to start investing passively in syndications crossing estates. And really it wasn't till I owned, I don't know how many units before I bought the first house I live in here. So did a little bit backwards everybody else. And then since then I've just continued to kind of take what I call the hobbies beginning to kind of a part time job side gig, 2017 my commitment was up for the military. And by that point, in the three or four years I've really been focusing on real estate, I'd had enough to go ahead and kind of step off active duty and go work for myself.

I still play in the reserves, more or less full time right now, which is kind of cool. And then commercial real estate on the side. Now syndicating apartment complexes mobile home parks and RV parks.

Is it enough?

David:

I feel like that's enough. I also love that you led with your success in 2007. I think that's cool.

Jeremy:

Yeah, I know, so, you know, I think a lot of people are ashamed of that stuff. But that $50,000 loss is probably the cheapest education I could have gotten on not being an idiot in the stock market.

Because I think it's just as likely I would have done the same thing at some point in the future when I was playing with, you know, six figures or seven figures and lost it all. So yeah, it hurt. And I paid the price for the four years every month paying that loan payment, but it's worked out.

Alex:

Dude, everybody needs everybody needs to learn.

Well, first off, everybody needs to learn that what you said was the most important thing he said, at least to me was I'm not as smart as I thought I was. Which I think is people, especially people who are entrepreneurial, I think are prone to thinking that they're smarter than especially, you know, if you are actually smarter than your peers, you might think that you're smarter than you actually are, which is what gets you in trouble. than my social group, I can't lose. It's like, yeah, you can. The world's big. And paying for that education up front is good because somebody hit me sad like, I want to buy houses, but I want to lose any money. I'm like, well, then you're playing the wrong game, because you're gonna lose eventually.

And the faster you can do it up front and learn that really not just hear it, because you can hear it all day long. But you gotta feel it. You're like, Oh, I messed this up. That's a humbling experience. And that's how you really, that's how you really learn, well, when I'm okay with losing money, and maybe I won't do it so frivolously next time by getting debt to buy stocks has got to be the dumbest thing. And I'm so glad that you opened with it.

Jeremy:

Here's the kicker. People always say I've heard it before. Why don't you just hold on if you would have held on for four or five years that it would all come back? No, because I didn't buy the market. I bought individual stocks and like three of my 10 companies went out of business, right. I had great ideas. It wasn't like my investment criteria was wrong, but I'm not controlling the company. I'm not control the greater market. I'm not controlling the economy. And so yeah, I knew that healthcare was going to digitize. But it didn't go fast enough for me to make any money 2008-2009. So.

Alex:

You know, let me ask you this actually, if you had taken that same strategy and one, do you think that makes people worse? Meaning do you think people that get to easier wins too early in their career, they actually get more arrogant and take on worse risks in the long run.

I know it's like an anecdotal statement, but in my experience, like if you take those wins early, you get too cocky, not too..

Jeremy:

So here's what happened right? I graduated in 2007 from yours Oklahoma, in 2005-2006. I saw buddies taking these investments or taking these loans and going to invest 2005-2006 and they were able to, you know, 50% hundred percent double their money kind of thing. And they were buying Mercedes and trucks right and so it seemed like this is a plug and play. If you make enough money you buy a cool car, right like is good. If that had succeeded 100% believe one I'd have a job right now, I'd not be in real estate. And yeah, I might have had a cool car for a few years, but I would have learned nothing. So yeah.

David:

What I'm getting out of this is that we should all take out key locks and go invest in the Sure thing that is Tesla right now because you know, who doesn't want to buy 375 price to earnings ratio? What could possibly go wrong?

Jeremy:

We're gonna have this same conversation with a young kid who's on Robinhood right now buying Tesla buying something else on margin. And a few years later when they realized holy cow, I just got hosed.

I still mess the stock market? Yes. I changed all of my investment strategies. Yes. Right. So I saw a pretty healthy net worth in the stock market. But I don't, you know, own a broad based index fund. It's much easier to sleep at night and not have to go check every day. My wife used to make fun of me, really, and she's like, stop checking how much money are you losing today, right, but I couldn't help myself a few years

10:00 - 15:00

David:

so that's and then we can get transitioned into the fun stuff but the stock market so I've played it I've won I've lost you know, whatever we've all put so with when when the virus hit and it crashed I put you know three grand into like three companies that was like yeah these will bounce back and I made a great return right like whatever wasn't a ton of money was just gambling It was literally like a check. I didn't know I had come in the mail and I was like, yeah, I'm gonna gamble with this and see what happens. And I made I don't know 40% 50% like two weeks like it was great, right? It was easy.

What I forgot about the stock market when you do individual stuff like that instead of my index funds my tsp and whatever. Is that Yeah, I even if it's going well, I'm checking all the time I'm stressed I'm worried I'm looking I'm there with real estate, I buy a house and I'm like, here you go manager. Let me know if you need anything, or you know, or I've got the system or like, I don't like feeling like I'm chained to looking at what might happen to my investment through someone else's actions even If I'm winning, I know galaxies rose roses eyes, but, but I don't I don't like, I just I just, there's a system with real estate and I know like, there's still stuff that can go wrong, but at least I can sleep at night. I don't I don't feel the urge to look at it every 10 minutes. Even if I'm not going to make 40% in two weeks' rental property, I would rather make money that way.

Alex:

Yeah, yeah, you have to get over the emotional, the emotional addiction to watch those stocks, but I don't. But the upside is much higher. Right. So it's like, yeah, I mean, but that's thought, you know, especially right now, I don't know if you know that. But yeah, you know, you can't lose as long as the Federal Reserve is doing what it does. So stock markets are good right now.

Jeremy:

Yeah, all to say though, I invest in the stock market is not my primary investment goal anymore. It is a pretty small percentage of my overall net worth at this point. But yeah,

David:

What's the big play now?

Jeremy:

So the big play now is basically apartments and mobile home parks. And then my little secret right now is I'm buying RV parks. So before it's cool, you know, what is it? July 2020 putting my flag down. I started the trend right so, you know, my first four Plex in 2010 was kind of pre pre me ever finding BP was well before the BiggerPockets podcast started.

So I was burning and I was house hacking before burning and the house hacking reason works. So I try to go be contrarian and find, you know, cool things to do before the cool things and then I try to get out and everybody else wants to do the same thing not to say that they're not violence, just trying to stay ahead of some stuff.

Alex:

I like it. I think the RV Park is a I don't know if you want to get into that. But I think that's a good idea. The van life movement is going to grow especially after this whatever is gonna happen to the economy, It's gonna it's gonna plummet some point in some fashion, and I think, just like in 2008, right, like people go, Oh, the millennials don't wanna buy houses because they saw their parents lose their houses. It's like yeah, you see something similar with that as well and people are gonna go to this minimalist lifestyle they're gonna move out of cities in many cases not all but many cases are gonna move to cities with video teleconference working, you're able to get a lot more mobile and I think RV life is gonna pick up people are gonna want to live in a in a I've already I'm thinking about it right like I've been I got I'm on van life on Reddit, look at these people. I'm like, yo, that's dope, just me my dog will drive up and down the East Coast we'll go to national parks will live a little bit more nomadic lifestyle so I don't know that it's gonna become super mega mainstream but the fact that but as far as popularity increases, I think that's a I think that's a valid strategy.

Jeremy:

So okay, let me let me give you two things there, right. So I think the thing that I have found the most I think all of us who are in the military, even if you're you know, young enlisted, you have no money and you have a negative net worth. You are surrounded by people who are not the same as the average American, right? Socioeconomically, right.

Even as a, you know, brand new boot coming out of boot camp, you have medical that's backing you up right there. There's always going to be food to eat. There's a steady paycheck, right? Things are going well, if you look across the United States, right, we're pretty top of the pyramid when it comes to kind of financial resources. There's a lot of this country that is definitely not in that same spot, right.

And so what most of us are talking about me and my peers talking about real estate, we're often talking about the kind of housing people like us, right, but there's a whole nother level that still needs housing. And a lot of people don't want to deal with it, right. It's, it's stuff that they want to talk a little bit to acknowledge. But if you are that person that is working at a minimum wage job, or at a retail big box for fast food restaurant, and you want to live on your own, you have options, right.

15:00 - 20:00

Jeremy:

And so maybe 30 years ago, mobile home parks were a big option or to sell an option, but they're decreasing so fast and how many are still available. They're not making the homes for parks anymore, right. Most of the mobile home park manufacturers are really selling these homes are kind of built to be put out not to say they're not gonna be, it's just they're not making a meal.

And so if you have a tight financial situation, you're looking for an apartment that you can afford, you can have to live with roommates, or you're going to have to go find something else. And that's something else that I'm seeing over and over again, right now our parts is people buying RV’s, and they're living in RV’s as a long term living solution, similar to like a mobile home park, right and have a community and have their RV, but it's not like a travel right, they might be in the same spot for years and years and years. But they're not very many in most markets, long term, RV parking spots.

And so, you know, we're buying some campgrounds and kind of, you know, minimally a mini, they're not super high end, or just say, hey, we're gonna move over from doing like your nightly leases to you know, Six Month and 12 month leases, we turn these into kind of mini RV park re mobile home RV parks providing a service these people desperately want. And we have a list of mile long people looking to move in because there's just not enough places for people to go.

So you know, if people's okay, that sucks, it happens you start to become a victim because now you have a lease. But you know if somebody's not paying, they also can realize I literally have 15 people on the list wanting to come move in here because everybody's looking for a place to park so I kind of see a pretty untapped niche at this point. And I'm pretty excited to plow through the years.

David:

I looked very heavily into buying an RV when I came out here to San Diego this time because I was going to go bachelor, so I was like, dude, I would love to just live it up.

I was gonna buy an RV in Missouri and drive it out here park on base, you know, but ultimately what it came down to is two things. One I realized when the family visited that wasn't going to be quite ideal and and then the internet piece but so two the way the base works here the rates are great but you have to move every two weeks so it was gonna be like okay, well I'm close to my office for two weeks then I'm 40 minutes away for two weeks then I'm off base pay and three times as much for two weeks then I'm back.

And so it's just it wasn't quite as convenient as I thought it was gonna be but I still like my roommate. I'll tell you that we had this conversation like two days ago. I'm like, Man van life like what if I can send all my stuff back to Missouri like three months early? And I can find a cheap van on Craigslist that even if it cost me five grand it's still cheaper than three months rent so I could buy this van like, hit up like there's like even from not all the practical reasons from just like a dude who wants to do stuff outside perspective. Like, it seems like it'd be fun for even just a few months, let alone so I think it's definitely trending.

Jeremy:

Yeah for sure.

And I think I don't know if you guys saw but during Coronavirus, the one product that I know that outsold itself year over year from anything else was Arby's at one point. My business partners like the RVC wanted Airbnb at one of our parks and he was not finding like six available used RVs across a couple hundred mile swath because they just been snapped up March April May kind of timeframe everybody wants to travel by themselves. So.

David:

That's awesome.

Alex:

Pumped me up. I'm gonna go buy an RV now just you know, try I want to be ahead of the trend, mine is pink one.

David:

Buy an old school bus and paint it pink.

Jeremy:

Yeah, yeah.

Alex:

Well, I'm a little too busy for that.

David:

Short bus.

Alex:

I’m gonna put shower in there.

Jeremy:

I gave you my hot tip. Do you guys want to hear how else I sucked at this before? Because I do a podcast and I hear somebody else. Tell me how they screwed it up and like at least I learned something.

David:

I would, I would love to hear some of those.

Jeremey:

Okay, so I have two right? So I bought a six Plex. So first getting started in commercial real estate. I knew I wanted to buy more than five units. I think if you click around internet reforms, everybody tells you hey, I'm looking for a multi one. You know, I want to get that commercial experience.

So I found that right, met a couple from the local Ria, it was selling six Plex. We looked at it, it was rough. And I said, no, I'm not interested, right? They wanted too much money, and then six to nine months later, and then we kind of had a talk about it every time we're at the deal. We found some Hey, look, we're about to just get rid of this thing on the market, just selling it way lower than they originally were asking. I said, Okay, I'm gonna take a look. So when I looked at it, I bought a property manager with me to kind of do the inspection with me as I went through it. Not a guy that I had a relationship with, but I thought maybe we're taking on

we walked it all places, comments to me was, hey, this looks like it could be a really good deal. But I hadn't noticed part of it.

Okay, so about the six plex owner financing. I knew that doing my job was gonna be able to be available day to day. So I brought in a partner to bring any money because going to be the management experience was 20%. He was going to manage and then we're just going to get rich off the sixth plex.

20:00 - 25:00

Jeremy:

And about a year later. I don't think I would make any money. He decided he decided to quit. He says, I said I fired him. But it happened on the same day. So as a matter, he had to get released. I took over the management of a six Plex and arguably the worst part of Pensacola, that at the time, I think only had like two tenants, only one who kind of paid and I had to take over management, which is not something that I would call through good and renovations on a very low end property.

So piecemealed a very shoddy renovation to kind of get something back up to snuff put up a open house, the only open house guest I had was the local neighborhood prostitute who was a little high on whatever she was taking, who left to do a trick and they tried to come back and I told her she wasn't, she wasn't invited back. And that was kind of like a huge slap in the face to realize, again, in real estate, maybe I'm not as smart as I think I was going to figure out a better way.

So thankfully, during that process, I was also starting with the syndication route, we already syndicated our first deal. We're getting ready to buy a 60 unit apartment complex with partners. And so I put that thing on Craigslist, it's sold it. Maybe a week we can have later and I only lost a couple thousand dollars, which in time saved versus money that was going to possibly be a totally good deal. I got out of it, right.

And so for me that being very clear, like hey, I'd rather buy stuff and other people that can help me versus me get 100% of you know, nothing. So that was a pretty good deal.

Now I will say that probably came back to me two years later, the guy sold it to get sick slash couple DUIs and had to basically start turning over all these properties because you could damage them anymore. So I got quickly in that property back smarter the second time I brought in the partner 50-50. And I told the partner was a young guy trying to get started. I said, listen, if I never go back to this property ever again, I don't want to step my foot on, give you 50% of this deal, if you'll just manage it for me. So he did actually make quite a bit of money this year, once again, because I partnered more directly so that was a great example of how not to do.

Alex:

Hey, David. And completely unrelated to this. I just want to make sure that we know in the future we should get guests that are good at investing.

David:

No, no, we shouldn't. We should get guests that are honest.

Alex:

Okay, Jesus. Sarcasm meter goodness.

David:

No, no, no, you’re always serious.

Alex:

So yeah.

Jeremy:

Everyones, no one needs money. That's boring.

Alex:

Oh, hang on. Because this is something that I try to talk to people about, they partnering on small deals, and I say, look, be very careful, right? It's like, you know, when you get married, it's like, you get married for life. And you get married, to do a lot of stuff together. Have kids raise kids, you know, do like projects, whatever.

And so, it makes sense. Like, you're not gonna always get along, but it's like, Look, we got big, big plans, which we'll be doing together. But when you get married to somebody for $100 a month deal. And there's just not that much on the line. But there's a lot that can go wrong. And like, you know, some people don't care about their credit score. And some people don't care about the income, and some people will just let it go, and you end up doing 100% of the work, you carry 100% of the stress to split 50 bucks or to split 100 bucks.
And then like, you know, it's not that easy to undo this stuff, use a 30 year mortgage depending on how you do it.

So I love the idea of partnerships, and I'd love to hear your insight on this, but I love the idea of partnerships. But I don't love the idea of partnerships on small deals. So 4-5 units less or less, it's just like it's a lot of stress for not that much reward, even if it goes well and the potential for it did not go well as high.

Jeremy:

If you're gonna partner with people, I think you have to have a true partnership right? The first one I tried to structure that was kind of just like throwing a bone. So the guy who managed the deal for me, but it wasn't a big enough bone. So when things inevitably started going poorly in a bad part of town with two people who are not really you know, equipped or desire to go script together the time and effort to make that thing work was an easier option for him really for me to say spotless just walking away.

So the second time though the partner has a 50-50 he's young, he doesn't have a ton of money and he's willing to hustle work, you know, he would make a crap ton of money off that deal. So somebody said who and there's all sudden say how I think partnerships for sure.

Alex:

So that's a good segue into this question. And I've made this mistake not grossly, but I made it on my first multifamily where I wish now looking back that I had my property manager as a part owner of the complex for that same reason, like that guy is going to be there every day, dealing with tenants and dealing it's like, you know, he should care about it more, he should care about it more than just like he says he cares to the 10%. Like, yeah, I need to get good people in there because this is my building to a little bit. Do you do that? Is that something you've done with the book with the bigger property?

25:00 - 30:00

Jeremy:

You know, I've fired somebody property management companies in the last few years, but I feel like that's maybe more my supervisor, anything else. And I said no, I do currently I do not have as well as up here. So I have multiple different property management setups across all the properties in different areas. But from my big, big stuff 40 units plus, my property managers are just property managers. And I recognize them as a commodity that I need to take care of, and that if they are working well, I want to make sure it's always working well, but I always am looking at other opportunities for property management, because not to say that the person will go bad for the person, they have to take another job, the company makes restructured things. I've seen all kinds of stuff.

And so right now I'm very, very happy with it. But you've always got to have in the back of your head, what happens, you know, think of that, right?

For my smaller stuff. And for some of my multi modal parts, we're actually starting to build property management in house. And one of the ways we are incentivizing our property managers is to give them some ownership since we don't have a full brokerage by them being an owner of the property, they can legally manage it here in Florida. And then I also have, again, a little bit more skin in the game, and it's not a ton of skin. But you know, just trying to start, hey, we're gonna pay you your fair rate, but we're also gonna give you a little bit of ownership. We want you to have a different mindset on this stuff. I assume over time, that will probably grow as they continue to provide more and more value for us too.

David:

I love that.

Alex:

Yeah.

Jeremy:

Property managers, just, she's just a property manager, right? She doesn't have any ownership is one of the other shifts you'll see paid. That's it. So.

Alex:

Yeah, because the same thing happens, right? If you get a property manager who manages a property that they don't like, and they have no incentive other than the 10% it's like, eventually, the 10% is not going to be worth it. And they're going to walk or worse they're going to quit while still taking a paycheck. They quit while they know, the old thing like people quit six months before they quit. You've heard that so the idea is the same. It's like you know, she's going to work every day cutting that paycheck, but mentally, you know, he or she whenever, like mentally people quit jobs long before they actually put their notice in.

And so yeah, if you have somebody who's incentivized poorly, and then they don't like it. It's like, dude, they don't care. And it's gonna show and then you're going to be in this battle like, who do I do they quit first if you fire them first. And then it's like, check this..

Jeremy:

It doesn’t matter, because you're losing money either way.

Alex:

Yeah, it's chicken. Yeah, it's like and you make a really good point. Something goes really for beginners, they get very disillusioned or I say misguided by this idea that you have to create this perfect team, especially when you're investing out of state.

Um, you know, maybe I'm lucky in that I talk about my property management contractor, like, you know, they're my God send. Right? And I'm very lucky, but I also know that people go, I hate to say this, when people go bad. You have a great contractor. It's like, Yeah, but not forever.

People change, they get other jobs, they grow. It's like, you know, I got a 30 year note on this, but my property manager may or may not be here for 30 years. Odds are and like you said, just because the company says the same doesn't mean that the person who was working there doesn't change. And it's like, yeah, I really liked Tommy. Well, Tommy's gone. A lot of companies do the same, but Tommy's the one that was the glue. And so, yeah, things change, you got to be able to adapt, you got to have somebody in the waiting alert.

Jeremy:

As it goes, the same thing goes for owners, right? You know, I think an owner to be really great for property managers, property management company, and then when their lifestyle changes or their situation changes, and all of a sudden, they have to go from, you know, keeping this property is up to date as possible to sucking every you know, possible morsel of cash out of it, that becomes really painful to.

So, you know, I think, for me, I try to be what I consider a good owner, which I think means you have to be able to spend some money to fix your property, what needs to be done to communicate. But I also think that part of that means now, as I've learned this is I'm going to be way more involved in the process, maybe not the day to day, but I need to understand the process and I need to be on top of that to make sure I understand what's going on. You know, communication is typically a pretty sure sign to me that nothing's really happening. So.

If you got something good going on, you typically want to tell somebody right so you're not talking to me. I typically get a little bit scared about why what's happening so should have some personality types who would argue the other way, but they haven't worked with, you know, our management style here. So, yeah, I think everybody does that.

David:

I like that.

Alex:

I like that, yeah. Be a good owner and you'll get good people.

Jeremy:

Yeah 100%.

Alex:

I mean, I'm very rarely am I shy to throw money at my prop, my property that's like, I can't afford that. It's like, that's not the no, yeah, I can't afford not to afford it.

So throw the money at it first, and then you'll get better tenants, you'll get better management. The management doesn't want to go to a tenant like yeah, we know you want that fixed, but the owner doesn't want it. Now you put them in a position where they're not like as we talked about, like I just said, like, they're not happy because they're stuck between a fussy customer and a fussy owner. And doesn't do them any service like no help, like, do what you have to do first, and then odds are it'll work out in your favor, although it's a little bit counterintuitive, because if you if you suck all the cash out and you're tight on the deal, the deal starts falling apart cuz like property, the tenants get less happy. It's a downward cycle.

30:00 - 35:00

David:

I think we were both in the same forum not too long ago. We you know, I don't know if we've ever talked about this, but I've seen you say it before. And I know I say it all the time. We're like people will be in like BiggerPockets forums and you know griping about like $50 from a tenant or something or it's like, I always just comment, like, look, dude, if $50 is worth as like this much stress, pain, misery in your life, like you've got a bigger problem with your business. And we need to talk about the same thing, like, I don't just throw money at my properties all the time. But at the end of the day, like my property manager calls and says, Hey, we need to do this and like, okay, cool. Yeah, thanks.

Jeremy:

Property Management is tough. It's tough, right? For small multi families, you know, below 60 to 80 units. The financials are always really, really tough to find the right people and you've got to kind of just, you got to just win, right? You just got to find a winner. That's tough.

We have been really successful in finding a larger property management company that was able to come into the sixth unit property, and now it's managing some of the other stuff too. And we were able to do that because the property management company really liked us, right? Me and my partner, you know, came in and we were very clear on what we were looking for. We were playing games, you know, he signed things quickly, turned things around fast and something needs to get fixed. You got to fix right.

And so I've watched that same property management company turn down a whole bunch of other people in the market with similar types of properties, because they just didn't want to deal with the person. So yeah, I think that's, yeah, it's a good time to you know, know what, you know, right?

David:

Yeah, just be a good person.

Jeremy:

You can do it.

Alex:

I think people get scared of spending money, right? They see it leave out and they don't see that it's, uh, they get scared of it. So they get tight. And then not to say you want to be frivolous with the money but it's like, it's, it's almost better to be throwing too much money at something then then certainly, they're not gonna be so tight that, you know, it's like, I don't want to fix that water leak. It's like, dude, you're this is not helping anybody.

You know, and it's gonna cost more. It's gonna you know, it comes back to this idea of like, you know, pay attention to your problem like fixing problems up front. Because they grow. And then in real estate stuff grows like you wouldn't believe it's like just, I learned a while ago, I used to try to fix water heaters, like go try to fix it, go try to say that AC, it's like, just write the big check today right away. Don't try to hobble it along, it's gonna cost you more the tenants not happy the property managers got to deal with a bunch of times just yours.

David

Let me let me let me flip the script. So we're all we're all landlords here, right? So what is your initial reaction to a tenant or potential tenant who sees your listing for a place to rent or whatever? And you've got to listen for $1,000. And they're immediately like, we take 800. How about a 50? Let me negotiate this down. Let me let me talk about this. Let me What about this? Well, what about this, they nitpick? And they're, they're, I mean, they're cheap, right? Like, there's a piece for frugality. But for me if the first question out of someone's mouth is about how much less I'm willing to take for rent, and then a bunch of other questions about what I'm willing to do for them, while they're also asking how much less I'm willing to pay for rent, I will immediately write them off, say not someone I want to deal with.

And I'm sure it's the exact same for a property manager when a landlord is like, hey, I see you take 10%. I've done no deals, you take eight. Well, what about seven? What about it? Well, okay, but I also want you to do this, this, this and this, which I didn't see that you listed, but how about not, you know, and it's like, it for me, it's forbearing sign up. That's the wrong word, but a sign like, and at some point, something's gonna bubble up is not gonna be someone I want to deal with.

Jeremy:

Yeah, so I will say, I don't deal with any of the tenant interactions. For affiliates. That's just not my, that's not my specialty. So I always have a property manager buffer between that. But I'll say yes, for a tenant that would be a huge red flag. That's also a huge red flag for me with partners. And that's also a huge red flag for me for investors.

And so when somebody starts coming in and asking for things, for better deals, when they haven't even done the deal yet, it's like no I'd rather just not work with you at all then try to make this work, you know? And not to say that you take advantage of but I see a lot of times a brand new multi family, I don't have never done a deal. We come by to deal with me.
Hey man, why? What are you providing me that makes me want to even get up this morning and talk to you. But I think people sometimes over ask initial partners and investors too.

35:00 - 40:00

Alex:

To your point I think it also depends on the market. So if somebody comes to me and says, hey, I want to bring your thousand 50 or thousand dollar month rental for 800 bucks, and I'm like, dude, I got a waiting list at 1000 already. I mean, the goal now is to take if you look at customers as a bell curve from F being the worst customer that pays the least profit and complains most to the a customer that complains the least and pays the most profit, right? Like I have. I'm gonna go find the closest to a customer, I can put that thousand sets, I got a waiting list. I don't need to take 800 and then and you're gonna be paying like that's just not so there is a difference between I like your what your, what you said flip the script like I like your idea here where it's it is more intricate than just like, hey, throw money at it, don't worry about it. It's got to be a like Jeremy says like, there has to be a reasonable return of value for each party like I have to, like, I'm not going to go and do your deal. That's what you're really that's what that person is really asking, hey, Jeremy, come do my deal for me. And so I'm gonna take credit. And you know, I'll give you 500 bucks, right?

So yeah, I mean, it is definitely more intricate than that.

David:

Yeah, the more I get into real estate, the more I try to filter things through the lens of like, okay, earn $1 how do I earn that dollar with the least amount of stress in my life? Like, that's like what you said closest to the A, like, whereas the, you know, because if you go too far into the right like the guy might be willing to pay you 1100 bucks, but he expects you to, like have fucking caviar at his house every morning when he wakes up, you know, it's like, Look, I want the guy who's gonna leave me alone, pay on the first and leave my place looking just like it was when I left. Like, I know that's not always as easy as it sounds, but even in deals right, like, if you could offer me the best return in the world, but if I'm doing all the work and I don't want to do all the work like yeah, you know, but anyway, so yeah, the how can I earn that dollar with the least amount of stress in my life.

Alex:

That goes that customer transcends to all all all, how do I say industries to So Jeremy, I got because I got you'll appreciate this. You have people who give you money for deals that are f customers whatever right and you're like, ah, you helped me raise money. I don't want to take your money again because you're so hard to deal with even though I'm sure you have those.

Jeremy:

Well, so I try not to take those people in the first place right there.

Alex:

But you but you but they exist. That's my point.

Jeremy:

They do exist. And it's not necessarily fair to call these guys f customers, but generally across all my deals I'm working with other people, right? I'm not, I'm not working terribly, but across all my deals, there's always typically whoever gives me the least amount of money in the deal is almost guaranteed to cause me the most amount of friction or stress at some point during the deal.

It's almost always an issue of, they have the least amount of money. And so this is something they're trying to figure out or whatever. And it just stresses the stress of it causes all kinds of problems that are outsized to their investment.

So the guy who's stroking the 250 thousand dollar check, doesn't call doesn't care is very happy with what's going on. The guy who writes the $25,000 check though, is like, Hey, man, I don't understand why this isn't happening. And you're like, Hey, man, there's a lot of reasons why don't worry about it. Right. So.

David:

Yeah, it's so true.

Alex:

The guy who has a $25,000 check is writing a big percentage of his net worth to you. And the guy who wrote the 250,000 is probably not writing that much percentage of his net worth to you.

So the stress levels of places like, Oh, you messed that up, Jeremy, it's like, Alright, the other guy's like, do you have all my 25 grand, like, don't you can't make any mistakes? And not to say that that's a valid argument. But that is probably what's happening on the backside.

Jeremy:

100% I am trying not only to try legally per sec rules, I'm not going to take your last one five grand, right? That is not an investor that I can work with right. And so one of the things I really screen for is, hey, do you have some money? Have you had a little bit of success? Because if you have nothing and then in turn, invest with me, you know, my returns aren't going to be tomorrow, right? It's like playing the stock market again. You're trying to like sit there and watch something that you can't watch because there's nothing to see. Yeah. Investors or investors or fun, right? You're there. You're number one partner, right? When things are working out well, and they're literally the number one reason you can't sleep at night and things aren't going well. And so It is leveraged to the court right and I think all of my success is based on leverage you know keep talking about all the deals have gone well but most of the deals we've got very very well right and so it's because it partner well I've leveraged well, time effort people and man, I'm just me, right? I'm a nobody but things go well, when you work with the right people the right time. So.

Alex:

I love that.

David:

Your most recent deals, awesome looking.

Jeremy:

Yeah. Yeah. Well, that's the other thing too, right. You know, I don't market for I don't, this is probably what I should say out loud, but I don't go actively look for deals. My deals at this point are kind of finding me right. So I've traded very much a niche in the kind of market that I'm in. And I have brokers that bring me stuff, say, Hey, is this something that you're interested in? And I say yes or no right. And so that's, that's worked out very, very well. I don't think that's something that's repeatable. And I don't think it's something that's necessarily sustainable over the long term, but currently in the situation that it's worked out really well the last couple years.

40:00 - 45:00

Alex:

If you ever need video production for some of your deals to help raise capital, I know a great guy. I know a guy who can really knock that out of the park. I mean, he's incredibly expensive, but it's worth it right?

Jeremy:

Yes. So you know, it's funny, though, right?

Talking about how to do deals, repetitive video, my investors. So the last investor webinar I did was about 50 people, I think I'm checking YouTube today 109 people actually watching it after you did a live.

So I probably had about 100 plus people watch this webinar. The number one question I got over and over and over again was on insurance, right. So all of my investors, it seemed like they believed the deal, right? The upside was sold. I have very few pictures of the property. The upside of how they're going to get there seems clear enough, I guess, all my investors really care about is how are you going to ensure this property so if something bad happens, you lose a lot of money.

So I found it interesting that when it comes to sales psychology for an investor, I think if you focus more on it's that loss, everyone's worried about the loss and not isn't focused on the game. And so if you can just sell, hey, you're not gonna lose. I think that's way more important than I realize, kind of before I get started in this process a couple times. And so again, right, the really glitzy, cool stuff, right, I really want to do, but I also realize that's not what's selling to the investor, right? And so it's like, well, I should just start PowerPoint on how insurance works. Now I have a bunch of it, and we're gonna be okay. Everybody would just have money, right. So.

David:

I think that's the market cycle piece, too. I mean, the timing of you bringing this deal that's everybody's concern right now is that the sky's gonna fall out.

So I will say you showed us your webinar before you went live just ran through it. So we could, you know, critique it. And you hadn't I mean, the deal looks solid enough that I was sitting there like, do I have money laying around in bed? I don't know. Like it was a good looking deal, right?

Alex:

How about your F customer? Oh, you don't want David, Jesus.

David:

I'm just gonna go on social media every day like literally this deal I'm doing everybody..

Jeremy:

I have seen that before.

Alex:

Preservation of capital, though, I like that, that I like that. Did you recognize that? I think David's probably right that some of that is the market cycle. Um, but preservation capitalists is so important, you know, coming from a banking perspective, it's like that. Is it right? We don't get banks to start with like, first don't lose our money.

David:

Well, I'm talking from a loss, money perspective.

Alex:

Well, I mean, I just mean trickles into that. That's not just mean I recognize that mindset. It's not just investors, right? It's more preservation of capital on bigger deals is far more important than the glamour Oh, you're 11% it's like, well, I'm giving you half a million dollars. I just don't want to make sure that it's a positive number more than I care that it's 11%. I really don't want it to be negative at all.

David:

Yeah.

Jeremy:

Well, hard to come back from losing money than it is to just make less.

David:

Yeah and people don't think that way right like people don't realize the which is funny I tell people all the time like the sexy thing to do is jack up your income and and make more money and whatever but like the most important thing to do is to cut expenses and mitigate loss and as Alex always says, avoid the risk of Ruin like don't ever take a risk that can destroy you right and people don't it doesn't sound sexy to say that so people don't you know nobody's rolling around in their Lamborghini doing a video talking about how how much money they didn't lose their rolling around how much money they made, but that's all well and good but one loss can..

Alex:

Also doesn't matter the, it matters where the person is in their investing cycle. Jesus this thing is pissing me off. Sorry, my yeah my video.

David:

You said you know a good videographer?

Alex:

Yeah.

Jeremy:

You should partner with that person.

Alex:

Okay, you got me, okay, okay, okay, all right, I hate you.

But when you're brand new, right, and you don't have that much, and you're usually buying a lot of debt to get this thing rolling, you're buying a lot of risk upfront, then I think, when you don't have as much to lose, you're less worried about losing it, right? It doesn't seem that it's like, oh, well, I'm gonna roll the dice on this thing, I'm gonna get this single family house, I'm gonna get I'm gonna get an 80 or 75% loan, I'm gonna use my last bit of cash to start getting this thing started.

And I think that's a very normal thing when you're, when you're new, you got to buy a lot of your risk upfront. And it's smart, because you don't have as much to lose. It's like, Oh, you know, it's, you know, like, you can go tight on a deal. But when you have a bunch of money, you're like, look, I'm 40 I'm going to give you half a million dollars. I don't have another 40. Like, I have 40 I can't make this back again, so soon.

So now I really got to hang on to it. And so I think that the risk profile shifts, when you're small and you're doing small deals, and you're new, you're like, look, dude, take all the risk upfront. And then once you're like, you know, it's the same reason why mutual funds are structured the way they are. It's like, you know, if you're 60 Don't gamble at all. Just, I just gotta make this thing hang on. And that leads to inflation.

So I think there's a variety of differences. You must be dealing with a lot of you got a bunch of old investors, Jeremy, no, no, no young hip kids.

45:00 - 50:00

Jeremy:

No, I mean, it's paper, right? I think your investor base if you're trying to raise money, you really have to consider your investor base is primarily going to be a standard deviation of just a few years around your age, right? Because it's going to be your network that you're going to start with, right.

So, yes, I have some people that are a little bit older than me. And a few people are a little bit younger than me. But the most part, I'd say we're riding in that kind of mid 30s range that me and my partner are rocking right now. Yeah.

David:

All right. So we've talked about two you mentioned there was one more that didn't go so well.

I’m enjoying these because I'm not the only one. Alex always likes to give me a hard time but I've, you know, I've lost money and I think it's very valuable for people to hear that that's the reality too, and that we've lost some money. But our net is still drastically up because little punches. Yeah.

Jeremy:

Well, and I would argue right, like losing money is a strange conundrum, right? Because it's not necessarily lost until it's done right.

So I've never lost money on a real estate deal. I found lots of real estate deals now produce what I expect. And I've also had a lot of real estate deals, you know, over a Grand Slam over what I've expected to so other deals we did 42 units. We've also told partners that the original setup was that my partner and I were gonna kind of come in, bring some money, bring some experience and bring some investors so that you can get closed.

Most all the problems I played myself on I didn't really do any of the due diligence, I kind of assumed and relied on the other guys to do that. We didn't have any kind of actual structure for the partnership before us as the sponsors. We definitely didn't know the market nearly as well as we thought we had, and didn't have all the construction worked out before we got started. So on that deal, we bought it about a year later and realized, we're going the wrong direction, right? We should have, you know, multiple units up, we only had 17 of the 42. I think when we bought it, there's still 20, something.

We had a whole bunch of loan proceeds that if they weren't going to be used within the next month or two, we're going to just go away. So we had some cash available, but we didn't do that quickly. We're going to have any cash left. And we're making no money losing pretty significant month over month.

And so unfortunately, on that one, I kind of stepped back in and said, hey, it's starting to take over. And part of that was probably just my own hubris, a part of that was we just needed somebody of the four of us to say, hey, I'm the Chief, you guys of Indians, one person needs to speak for us because we have multiple, it's not gonna work.

And so step back up for now one, and since then, right, I've been having to do kind of day to day, which was never my intention, right? This was all supposed to be kind of an easy deal. I'm just going to sit back and hang out and so now I'm doing the work, but there's this compensation for that, right? Which kind of sucks.

And so that that was very frustrating. But the nice part about that was being forced to do that by putting my nose to the grindstone two years ago, right, I now have to know how to run this deal, right? So I feel very confident in being an operator and running a construction project. And now I've got the steel back from visiting dead to where it's making, you know, a ridiculous amount of money every month, with still more to go. And now the questions are not like, how do we pay the bills? It's like, do we keep building up these units and trying to make it worth even more when you take a bunch of cash right now, right? So they're much better problems that have been another great example of like, you got a different partnership, right? So we thought the partnership was going to kind of work just natural and smooth, no partnership moves natural and smooth, and some of the things fell apart. You better be ready to step up, right? And pick who's gonna do what and make that very clear very early. So don't go sucks.

Alex:

Do you think that happens often?

Where were some partners in a deal? I don't want to say, I don't want to say give up, but just stop holding up their end of the bargain. And then somebody else unexpectedly has to go and run a deal that they...

Jeremy:

It doesn happen. Yes, I know it happens, because I've talked to others you know, when this happened, I kind of reached out to a bunch of other guys I knew a little bit harder for me than some other stuff.

Now, I would argue in this deal. The failure was across the board, right? All of us can screw this up, because we didn't want to delineate it. And so it's tough to say it was someone else's fault if they didn't feel like they had the opportunity to make those decisions. Right.

So there was definitely some like, well, am I the way the decision maker right around the decision or where do I fall out in that? But you know, buddy, I talked to you and was syndicating a deal with the guys kind of set up through a group and the other guy was stealing money, right? committing fraud. He caught him, got him off all of the accounts, and then went to the lawyer and said, hey, what can I do? And the lawyer said, well, you can do this, and you can take this guy to jail and you can get his or you probably you know, scrubbing and prosecuting subrosa.

50:00 - 55:00

Jeremy:

But the problem there becomes that you're now doing solve your investors money. And it ended up being a more expensive right for him to go get the justice that was deserved. Rather than him taking over the deal, continue to operate the deal turning around making a positive cash flow and selling it for more, and then having to pay the guy who committed the fraud, because he still was in the same ownership percentage that was still cheaper, right and going after and solving the problem.

And so, structure matters for you to work with matters. And I think you've got to consider from day one, I think also tomorrow, day one you have to consider about how's this thing gonna fall apart, right? And when you understand how it can fall apart, and you've already kind of shaped things. I think that's a lot better.

So my partner and I right now we're going through and getting life insurance on each other, you know, we restructure things. So if you know something for you know, forbid would happen to both of us or one of us, our spouses and our investors would not be completely sunk because you know, bad things happen to good people Coronavirus gets people Right. People get in car wrecks all the time.

You know, even people get just distracted with other good deals, right? So this was a good deal. But this is an even better deal, right? So how are you going to focus on this, okay? deal, it's a little smaller, it's a really awesome deal. So with this interest is something you have to consider too, and so big, all those things come into play. It's been a super learning experience, I feel like that deal, specifically 42 unit has been really good to kind of give me the confidence that I can do this if I need to, but also give me the confidence that if you come to me and say, hey, I want to partner with you, my response is, okay, what does that mean? And we're gonna cut that very close to what that means, because it means I've never taken over, I'm going to be compensated, if I'm gonna have to take the day to day drive to the property and deal with the problems. And, you know, I was writing checks on my own personal account, to keep the deal alive for a while, right. That sucks.

And so, from doing that kind of level of taking the ownership of the deal, I hope to be compensated better for it. So.

David:

All right. Grand Slam time. We can't..

Alex:

No, I want to ask one more question.

David:

Oh, I'm sorry.

Alex:

One more we can go quick though. But, uh, you know, it's a tendency, I think for new people, I say that loosely to get petty. And I don't think they think about it as petty but you know, it's like justice, right? Hey, that guy did something wrong, you should get justice and it's like, that feels right. But that's all. That's very rarely the right approach. Most of the time, I find you just have to let things go, worry about your life and keep moving and so frustrating as it is to have to pay the criminal the fraud, Yulin? Ding dong. That was the overall right position even though you had to swallow a lot of that. You know, that natural desire to be like, Hey, dude, I'm gonna kick the shit out. You did wrong. Like that's the desire.

So I just want to emphasize that point like you did the right thing because, you know, moving forward, looking forward is the way to go, looking backwards. You get you, you spent a lifetime trying to write all the wrongs that people have done to you and it doesn't make your doesn't so make things better for you or anybody else?

Jeremy:

Nope. No, no, I think if you see your life as a timeline, right, you know, all these problems that we see there, they overwhelm us for a short amount of time. But now you're looking back years later, it's like, oh, that was a bump, right? I learned a bunch of stuff, right. And I think perspective, I guess would be my answer. It really helps you get to see the big picture and not get lost in the day to day.

David:

I agree. All right. All right. I bugged you about all your crappy deals.

Jeremy:

Yep.

David:

And I say all your crappy deals like it's like this huge amount. You never I mean, they're all really as far as crappy deals go. It sounds like they're more just stressful deals than crappy deals.

But Grand Slam time. Tell us about a good one.

Jeremy:

All Alright. So the one that I will always be searching for, again, would be that fourPlex in San Diego. But my favorite one that I talked about is my partner and I bought an 8000 square foot office building. That's far from where both of us lived in 2016. We questioned because I didn't exactly know what we were doing. But I don't think it was happening, what you're doing, you start to get started. And so got started, we were able to take a 8000 square foot office building return it, most of the offices able to add a few little things to kind of fix some of the expense drain, right, changing out some contracts we put in, our favorite story to tell now is we put in a Wi Fi thermostat. So we were able to change the temperature from his apartment phone at night. So it wasn't just always running us burning up the electricity. So help utilities.

We took a 8000 square foot building and we had to sell it in 16 months, because our plan was the owner for a five year time and get to a basically a million dollar valuation though he made 1000 and $2 million. Everybody can make a lot of money and walk away. Well, we sold it just over the 16 month mark and our investors made about 126% on that one deal. And so you know, buying right could definitely make you a lot of money. So It was like a 500% return for me.

55:00 - 60:00

David:

So when you say so so you guess the sales price would you guys..

Jeremy:

Oh, it was a 1.21, 1.2 million.

David:

Man, so you overshot your five year goal by double by essentially double?

Jeremy:

Right.

David:

Yeah.

Jeremy:

By the way we also paid cash flow throughout that entire deal to right cash flowed pretty much the entire time so that was a pretty good deal and that was like my first deal we syndicated and so if we will forever be kind of chasing back for those kind of numbers I guess but those are, I don't I don't think similar deal my deal in California right I made over 100% return on purchase price but I only put $27,000 down so my return on that deal was you know thousands of percent I will always be searching for that deal. But kick my answer to everyone that asked though is if you don't play the game, you can never hit a Grand Slam right? I'm always looking to hit a single but if you're not playing the game, you don't get the opportunity for the Grand Slam so Grand Slams are nice they help.

David:

Was it a babe Ruth or not Babe Ruth? I don't know, one of the famous, you know, home run hitters, people like, Well, how do you do it? He's like, I just try to hit the ball. Yeah. And that's, you know, people hear me joke all the time. I'm like, yeah, solid base it and they like people to take it as an insult when I'm like, yeah, solid base hit when they tell me about a deal. I'm like, no, like, I have gone for the fences on deals that did not work out the way they should have. And for me like a solid base hit with no stress It's just easy, like, down the road. That'll be a good deal, right? Like, I'm totally cool with base hits all day. But ultimately, like you said, if you don't swing the bat, you're never gonna hit it apart.

Jeremy:

And I don't know what I'm doing right. Even now. I'm 37 units. I'll close next week with a very good plan put together but I don't feel like I have some secret sauce of how this magic is gonna turn around. Okay, though, this is a pretty solid base hit, save people do the same thing we did in the last deal to get a little bit bigger.

I don't know if it's just playing the game. You know, I think for anybody that's listening to this guy's like us can do this. You can do it too, right? It's not It's not rocket surgery.

Alex:

Yeah, you can definitely do it if Jeremy can do it obviously.

Jeremy:

100%.

David:

Yeah. Sounds like I've definitely never heard Alex online say you know something like real estate's easy. I can do it.

Alex:

Yes. For the veteran RIA, I think like, you need a slogan. I'm like, real estate so easy, any idiot can do it. I'm proof.

David:

Yeah, I love it. It's true, though.

Alex:

I said to be a jerk, but it's good. Jeremy, I appreciate you coming in and showing like the goods and the bads. Because it's like, you know, people you will lose money along the way even if you net positive so people have to come in and think yeah, you can make money at this you lose money along you're gonna drop coins and thousands along the way. I got me up to 500 bucks a couple weeks ago, I think even other ones ripped me off for 1500 bucks. It's like, okay, but I'm gonna make 20 grand the project overall.

And I couldn't make 23 or whatever. But that's just the nature of that's the nature of it. So you're like, don't trip over Penny, don't trip over $1 to pick up a penny, that kind of thing. And, and it's good to say to show like, hey, look, there are gonna be stressful. It's not gonna go slit. Right? It's gonna be tricky and difficult. And then when you look back on it, you're like, oh, that was so bad like you said, it wasn't so bad. I learned a bunch of stuff. I'm better now.

And, and God forbid my, you know, my thing is, God forbid you want it too soon, then you'd be cocky. And you might gamble it all the way one day. That's why the lottery winners go broke.

David:

People don't ever think of real estate this way. Right? Because they don't think of real estate and stocks in the same vein, right? But if you were to graph owning a rental, just a normal rental property, right you were to graph it. It's just like the stock market in a way that if you zoom in, it looks like this. But as soon as you zoom out over the course of 70-80 years there's volatility there but it trends upward like owning a rental property you know, I had a guy die and one of my units last year, and he decided to die. The furnace blew up at the same time. He didn't have any family. somebody decided to die rotted for like three weeks. And like, it was like, it was like a 60 I think it was like, like, right around a $6,000 month from one guy. And the guy was paying 480 a month right in rent.

So he took an entire, like 1415 months of his rent with him when he passed away, which is super unfortunate, right, like, bad situation you had a storage unit involved to store all this stuff, whatever. And so like, that's one of those like, whatever, but over the course of the years still made, you know, money like I know, so people, it's easy to see like, like people think like real estate. Yeah. Cash flows. Yeah. But maybe not every month, you know? I mean? I don't know.

Alex:

Yeah, you gotta have a little bit of it makes you get a little bit of you know what it does. When you look at problems on a big timescale, Jeremy said it perfectly. You look back on it. You're like, that was a big deal in the day, the day of I was stressed out but after a big broad spectrum, you're like, Yeah, but okay. We'll be fine, right? It's not gonna, I'm not gonna die.

60:00 - 67:00

Alex:

And I think to be fair, I think the military helps deal with stress, like, you know, my opinion of things now, like, I'm not stressed until those bullets are flying ever. So I think that helps give us a little bit of an unfair advantage. You're like, Oh, I lost a little bit of money. Like that's it.

Well I am not to say that there are no problems. I just mean like, if these are big responsibilities, man, like houses are fairly big responsibilities to big mortgage. And you start with more than a single family, start buying other bigger properties and you start bringing on other people's money. These are big responsibilities and you're gonna have a little bit of fortitude, not to go, you know, drink yourself into a hole for three days because you lost five grand, like, get some real problems.

And so the bigger problem as you can focus on bigger problems, the small stuff starts to wash away like oh, I had a property flooded. Upstairs neighbors think flooded. My condo, my whole condo flooded and I had to put it out, put up a lady up for another towel and that ended up on insurance gave me a big hassle and bubble. It's like just writing the check to fix it and then we'll deal with it later I don't care.

The property the property broke even for the year because of that it's like oh well surely could have been worthing goodness gracious.

Jeremy:

Analysis point two write also as military. How much time do we spend like doing things we think are stupid. It doesn't make sense. But we just keep doing it right? Like I was told to do this. I'm just gonna keep doing it. Right? So right?

Like, hey, we're going to swap this deck, right? We're going to go pick up five, we're going to do something that's like, we're doing this like 15 times for no reason. We're just going to keep doing it right Real Estate's a lot of the same thing. If you stick to it long enough. Over time, it will continue to work right? You just do the right thing over and over and over again. You're going to hit some hard bumps, you're gonna see some problems, but over time, it's going to make the money.

Alex:

Do you remember raking lines in the sand and we haven't had to do that?. Right? Oh, well, okay, I was in the army and I was an idiot and you're gonna rake lines in the sand. That was like the thing in the south. I don't know.

We don't have Nice faces in San Diego. Okay, we were in North Carolina and then nowhere and raking lines in the sand is like it's like you're analyzing deals. It's like you're communicating with your investors. It's like just every day right those right those lines.

David:

All right, Jeremy, I got a few questions. I always ask people and Alex has a fourth one that he hasn't come up with yet but he's still working on it. So we'll see.

If E1 and E2 walked up to you asking you for life advice. You had like two minutes, what would you tell?

Jeremy:

Invest in yourself and take some risk early right? If you're E1 E2 you can strike out and fail and start again tomorrow and strike out and fail starting tomorrow so do more than you think you can and leverage as much as you can with other people.

David:

Yeah, I love that about the military. Like there's a safety net there. Like the one the video I did earlier this week with the guy who has a four Plex, like we talked about that, like, not that he's going to lose everything, but if he lost everything he's young enough that it's like, okay, next. Yeah. Yeah. All right.

Okay, cool. What is one resource, book, course, website, whatever that you would recommend to anybody looking to get started in real estate?

Jeremy:

So it's very dated and I hadn't read it down a few years, but it's the one that I started with. So it's super imperfect, but it's what I use, and it's a little book called investing in duplexes, triplexes and quads by Larry Loftus. I read that book, right after I lost all my money in the stock market. I said, ah, this probably should have done instead and took that idea to go find that small multifamily rent out the rest and basically launched me on the journey. I'm on now, you know, hundreds of units moving to thousands, hopefully next year.

David:

I think that and you said Larry Loftus?

Jeremy:

Yes.

David:

I’ll go check that out. All right. And question numeral three, where can people get a hold of you?

Jeremy:

Alright, so this year my partner and I finally partnered up right so we Jade been for a long time. And we have launched our own private equity real estate firm so Climbcapital.com, find me or you can email me at [email protected] and I'd be glad to help. And I'll give you my phone number because I don't think most people are going to call me but it's 469-878-0422 so I love it when people get started in real estate.

My wife doesn't want to talk about it anymore so be careful.

Alex:

I'm texting you right now I'm gonna drunk text you tonight.

David:

It's it's actually funny because we had that group text go the other day and I meant to say, who is everybody? Because I realized I don't have a phone number to say so.

Awesome. Well, Alex, did you come up with a question?

Alex:

I did. I do not but I'm gonna I gotta I gotta think about it. I feel I fold under pressure. You know this.

David:

I know. That's why I'm having fun with it. Well last until your questions are better than mine.

Alex:

That is 100% what's gonna happen.

David:

Yeah. Okay, I'll just tell my editor to cut off your question.

Jeremy:

Which is to remember Alex 100% two weeks from now is not nearly as good as the question today.

David:

Whoo. Whoo.

Alex:

Okay, you're making me insecure.

David:

Oh, man Jeremy.

Jeremy:

That's a good question. What makes you insecure?

Alex:

So I did my first podcast. I had like five or six very difficult questions, but I find that they're, they're difficult for me to ask people on the fly.

And if you ask them in advance, they lie. And so asking questions like that, you know, what makes you secure? Talking about failure. When have you been overcoming confidence you know, these kinds of things. These are good questions but they're the actual act of asking somebody those questions you're going to get. Like I said, if you ask them on the fly, you're going to get weird answers or, you know, like, answers that aren't well thought out. So they don't give you the real it takes a little bit of introspection, ask this question.

But if you ask in advance, generally you get the good, you get the soft, the soft answer, you don't get the real, you know, it's hard to get people to give you real truth.

So it's, uh, I'll figure something out. That's a good question, though. What makes it insecure? That's a good one or a way to leave some version of it.

Jeremy, what makes you insecure?

Jeremy:

I still think there's something to be said about kind of imposter syndrome, right? So I've done now multiple, you know, large commercial syndications. I've raised a bunch of money, successfully turned a few around. And yet I still feel like when I go start looking at these deals like do I know enough? Am I smart enough is this, can I really take this risk and so on. I think it's just the imposter and feeling.

David:

It's a very real thing.

Alex:

Yeah. It's a very real thing. I get it.

David:

Yeah. Absolutely.

Jeremy, thank you very much for joining us today. This is fun. I'm glad we finally got to do this when I woke up.

Jeremy:

When I woke up?

David:

Yes, yes, yes, I made it. So I appreciate it.

Jeremy:

Yes, thanks!

David:

Have a great day.

End:

Thank you for listening to another episode about my journey From military to millionaire. If you liked it, be sure to visit Frommilitarytomillionaire.com/podcast to subscribe to future podcasts.

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Jeremy Hans Show Notes

Episode: 104

Jeremy Hans

Join David Pere and Alexander Felice with their guest, Jeremy Hans as they talk about Jeremy’s experiences and his journey on how he became successful in real estate. Jeremy shared his experiences and his knowledge of how to do business. They also gave tips on how to be successful in investing in real estate and the stock markets. Grab a pen and take notes and let’s start investing!

In this episode, you’ll learn:

  • Jeremy’s successful journey with stock markets and investments
  • Stock market, how to invest and what you’ll get after investing in it
  • Investing in properties, stock markets can be successful
  • There will be times that you’ lose, but don’t give up, everybody needs to learn, mostly with their experience
  • And much more!

~

Jeremy Hans graduated from the University of Oklahoma he commissioned into the US Navy and attended flight training. He was winged as a Helicopter Pilot in July of 2009 and moved to San Diego, CA to fly the MH-60S helicopter. There he was stationed with HSC-8 deploying multiple times including twice on the aircraft carrier USS John C Stennis during Fifth Fleet deployments. He was fully qualified in the aircraft and also served as Assistant Training, Operations, and SAR Officer.

His shore tour was at HT-8 in Milton, FL as an instructor in the TH-57B/C. He focused on instructing the newest students and had over 40 on-wings and numerous Bravo Checkrides. Jeremy was extended in 2016 to help gap an instructor shortage and finished with over 2000 hours in the TH-57. He was qualified as a Contact, Instrument, Navigation, and Formation Instructor, Assistant NATOPS instructor, Instrument Check Pilot, and he additionally flew at the Instructor Training Unit.

Following his time on Active Duty, he affiliated with the Naval Reserves and was selected to fly at HT-18. Again filling an instructor shortage he took full-time orders as the Reserve Department Head and to join the team bringing a new training helicopter to Navy Rotary Training.

While stationed in San Diego he began investing in real estate. They started with a fourplex, Heidhe and he lived in one unit while renovating and renting out the other units. Over time they increased the quality of the property and eventually sold after doubling the value. After moving to Florida they began a focused real estate investment plan. They wholesale properties to local flippers provided private money lending and eventually purchased and managed a small mobile home park and apartments. From 2016 and on they sponsor group real estate purchases and raise investor capital for large commercial properties while also investing with other sponsors in the apartment and mobile park deals around the country, currently having ownership in over 600 units.

~

You can find Jeremy Hans on…

Website https://www.jeremyhans.com/

Connect with David Pere and Alexander Felice!

https://www.frommilitarytomillionaire.com/

https://www.youtube.com/channel/UCQElNqStWjEBDFNVnXkh1ng

Advice to an 18-20-year old:

Invest in yourself, and be willing to take risks when you’re young.

Recommended resource(s):

Investing in Duplexes, Triplexes, and Quads by Larry Loftis https://amzn.to/3eY9EOg

Real Estate Investing Course: https://www.frommilitarytomillionaire.com/teachable-rei

Recommended books and tools: https://www.frommilitarytomillionaire.com/kit/

Become an investor: https://www.frommilitarytomillionaire.com/investor/

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My name is David Pere, I am an active duty Marine, and have realized that service members and the working class use the phrase “I don’t get paid enough” entirely too often. The reality is that most often our financial situation is self-inflicted. After having success with real estate investing, I started From Military to Millionaire to teach personal finance and real estate investing to service members and the working class. As a result, I have helped many of my readers increase their savings gap, and increase their chances of achieving financial freedom! – Click here to SUBSCRIBE: https://bit.ly/2Q3EvfE to the channel for more awesome videos!

THIS SITE IS INDEPENDENTLY OWNED AND OPERATED. ALL OPINIONS EXPRESSED HEREIN ARE MY OWN. THE VIEWS EXPRESSED ON THIS SITE ARE THOSE OF THE AUTHOR OR THE AUTHOR’S INVITED GUEST POSTERS, AND MAY NOT REFLECT THE VIEWS OF THE US GOVERNMENT, THE DEPARTMENT OF DEFENSE, OR THE UNITED STATES MARINE CORPS.

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David Pere

David Pere

David is an active duty Marine, who devotes his free time to teaching personal finance and real estate investing for service members, and the working class!

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