BiggerPockets Real Estate Podcast - 143: Quitting a 6-Figure Job to Go Full-Time in Real Estate with Nick Baldo

Episode Date: October 8, 2015

On this episode of the BiggerPockets Podcast we sit down with a real estate investor who quit his six-figure full-time job at a Fortune 100 company to pursue his real estate investing dreams. Our guest, Nick Baldo, shares his story of starting with nothing and turning that into a sizable business that both flips and rents houses. Oh, and Nick isn’t even thirty yet! Don’t miss this informative episode of the BiggerPockets Podcast! In This Episode We Cover: How Nick got into real estate Where he is currently investing and the typical prices of houses in his area How he began flipping houses when he was just 23! Where he got his funding How he was able to do business with a private money lender Lessons learned from the first deals The importance of ARV analysis Why he took that first step despite the lack of knowledge The ins & outs of transitioning from flipping houses to house hacking How to handle real estate investing as a business How to scale your business by building systems The online tools he uses for managing his business How to use networking as marketing Where Nick’s business is today Tips for those who want to quit their jobs and become full time investors And SO much more! Links from the Show BP Podcast 142: 22 ½ ACTIONABLE Tips for Beginner Real Estate Investors With Josh and Brandon! Podio Asana Google Drive AppFolio Buildium QuickBooks BiggerPockets Keyword Alerts BiggerPockets Forums Books Mentioned in this Show FLIP: How to Find, Fix, and Sell Houses for Profit by Rick Villani and Clay Davis The Millionaire Real Estate Investor by Gary Keller Think and Grow Rich by Napoleon Hill Outwitting the Devil: The Secret to Freedom and Success by Napoleon Hill Tweetable Topics: “There are always people with extra money not knowing what to do with it.” (Tweet This!) “It’s impossible to get started without your character.” (Tweet This!) “We did things as a business that had a 100 rentals would do it.” (Tweet This!) Connect with Nick Nick’s BiggerPockets Profile Nick’s Company Website Nick’s Blog Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 143. We did things as if a business that had 100 rentals would do it. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the hype, you're in the right place. Stay tuned and be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online. What's going on, everybody? This is Josh Dorkin host to the Bigger Pockets podcast here with my co-host, Mr. Brandon Turner.

Hey, Brandon. Josh, how are you today? Oh, wow. That's really nice. You know, last week, you didn't want to be cordial. You didn't want to ask me that. And today, you flip the- I jumped right on it.

I feel good, man. You know, just knowing that you care. I care a lot. Yeah. That's just not true. You're not answering the question, though. What is the question, Brandon? How are you doing?

I'm great, man. I'm doing really good. You know, it's finally, we're finally starting to get out of this crazy Indian summer here. I think today might actually be a day under 80, which would be kind of nice. But yeah, things are great, man. Fall is coming. Leaves are changing. Denver is Colorado is just gorgeous.

So I don't know about up there in Washington if you're starting to see. It looks like the middle of like January. It's like rainy and cloudy and awesome. Yeah. That's all right. Anyway, since you don't really matter, let's move on to the people that do. Our audience. Our audience, they matter.

So how are you guys doing today? Oh, they're not answering either. Oh, wow. Nobody cares about you. Nobody cares about me and my questions. All right, guys. Well, today we get a really, we got a cool show with a young guy who's just kind of rocking it. And we're going to get into it for sure.

Really quickly, what's going on? with all these properties you've got going on. I know there's some kind of deal. You're in the midst of something new. Yeah, sort of. I mean, there's that one. We talked about last week. I just wanted to give a quick update. So we only recorded last week's show a few days ago. So not much has changed. But I wanted to say, you know, I mentioned last week that I put in an offer, which if you didn't listen to last week's show, go back and listen to it. You will love it. That's great. Actionable tips. A ton of actionable tips. 22 and a half of them. But anyway, on the beginning of the show, we talked about, I put an hour, or I'm offering on this property. Anyway,

I wanted to throw in today's quick tip and tie it into that. So when I offered on it, so today's quick tip, I offered with a letter of intent as well. And so what I did is I offered on the property, just like normal through my agent. And then I sent my agent a PDF of just a simple one page. It had a picture of my wife and I. And I've talked about this on webinars and on the podcast before, but it just works so well. And hopefully it'll work this time. But we'll see.

Anyway, picture of my wife and I. And it just said, hi, you know, we're local investors. We love this property. It would fit perfectly with our portfolio. are excited to fix it up and make it look just amazing. This is what we do for a business. And we just love this community. We would be happy if you would accept our offer. And I offered full price on this property because it's such a good deal anyway. So yeah, we'll see if that works.

But anyway, that's my quick tip is submit a letter with your offer. Even if it's to a bank, there's always a person at the end of the receiving line that's going to accept or reject it. So if you cannot submit an offer with a letter, do so. It's a great way to improve your chances. And it doesn't always work. It doesn't always. I mean, we've used that before. And this might not work by and, you know, tried that and, you know, in past and have had, you know, responses from people who think that you look like their, you know, angry, mean, you know, third cousin that they hate and they suddenly don't want to do business with you. Maybe it's not cute enough, you know.

I, you know, I don't have a benefit of looking like you, Brandon. If you put a picture of me on your letter, I mean, anybody can just take a picture of me and put it on your letter and you'll get your offer. Accepted. Guaranteed. I'm Brandon. Co-host to the Bigger Bockets podcast. I'm looking for a loan. Yeah, there you go. That's how you do it. All right. Anyway, that's my quick tip today. So I'll let you guys know next week if I got the offer accepted or not. So we'll see. Fantastic. Fantastic. All right. Great. We all joke that rentals are passive. But if you're spending nights matching receipts or guessing what a property earned last month, that's not passive at all. Base lane fixes that part of landlording, the financial chaos. Their banking and AI bookkeeping system

automatically tags every transaction, updates cash flow insights in real time, and builds the reports you need for tax season. You can even automate transfers and move money around without paying wire fees. It's just cleaner. Sign up at baselane.com slash BP and get $100 bonus. Baselane is a financial technology company and not a bank.

Banking services provided by Threadbank, member FDIC. A lot of property managers think their job is answering tenant emails and coordinating repairs. That's not the job. The job of a property manager is protecting and growing your operating income and earning your trust while they do it. And that comes down to three numbers, occupancy, delinquency, and net promoter score. If those numbers slip, your income slips, and your trust slips too.

And most PMs don't hold themselves to performance standards. They focus on activity, not outcomes. Mind is different. They obsess over the metrics that actually grow your cash flow. Go to mine.com slash show me to see how mine performs and get a month of management for free. because if you're going to hire a property manager, hire one that manages your investment like an investment. Most investors spend all their time talking about their high-level returns. But that's not the number that actually matters. What actually matters is what you keep after taxes,

and that's where multifamily real estate quietly stands out. With built-in advantages like depreciation, the right deals can generate steady cash flow while reducing the tax drag. Bam Capital structures its multifamily investments around those fundamentals, pairing tax efficiency with disciplined operators and a long-term approach. This isn't about chasing hype or guessing market timing. It's about building durable, tax-aware wealth over time. Learn more at biggerpockets.com slash bam.

Let's get on with this show. Today, I'm super excited to introduce you guys to Nick Baldow. Nick is awesome. Really, really, really quick before, Nick, guys, you listen to the show. You love the show, jump on iTunes, take three minutes out of your... day and leave us a rating review, it would be exceptionally beneficial to Bigger Pockets and the Bigger Pockets podcast. If you did that, just go to iTunes and leave us at Bigger Pockets a rating and review. We so appreciate it. Are you done? Are you done? You know what? This is important. This is how we get more listeners. This is how we help more people

become successful. I agree. You can't rush this, Brandon. I'm not knocking it. I am just Can't rush this. I know you're excited about Nick. I'm excited to introduce Nick. This bond together. And so why don't you bring him in? All right. Can I really? So Nick is a, he's done house hacking. He's done flipping.

He's done rental properties. And he's all, he's still under the age of 30 right now. And he's just crushing it. So with that, let's bring him into the show. Nick, welcome to the Bigger Pockets podcast. Now, that just feels weird. Nick. Welcome to the show, man.

It's good to have you here. It's great to be here. guys. Yeah, yeah, it should be fun today. We're going to talk about a lot of stuff. I read a quick bio about you and I know a little bit about your history and you've, you've done a lot of what I've done, which is fun because now I get to kind of hear a different perspective. House hacking and a little bit of flipping, a little bit of rentals. We'll cover all that today. So why don't we start there at the beginning? How did you get into this game? Well, it kind of spurred from a little bit of a dissatisfaction with a job as it often does.

started working right out of undergraduate business school at IBM as a strategy consultant. And on the surface was a great job as far as moved to New York, traveled a bunch, got to meet with a lot of different clients and had exposure to a lot of different things, learned a lot about business processes and all that. But I quickly realized that that lifestyle, the corporate lifestyle and being a prisoner to meetings and emails and all of that wasn't going to work long term. So I had a bit of an entrepreneurial spirit come up through me, potentially spurned on, you know, growing up, my father was an entrepreneur and I really admired things he did. So I just started to think. I know that this job is good for now, but what could I do in the future potentially to exit? Not sure exactly how it happened, but real estate hit my mind in flipping specifically, probably from the shows, you know, HCT shows, things like that, as it often does. But as I started to look into it and read up on it and to learn about it, it seemed very tangible to me and something that I could wrap my head around is something I could potentially

start as a project. It was quantitative, which really fits some of my strength and some of the things I had learned. At the same time, I had a childhood friend who had gone to college and had trained to be a carpenter, and he had been also thinking of doing something similar with real state. He's gotten really skilled with that. So we had talked and we said, hey, why don't we try to do this together? I eventually left New York, came back to Buffalo, kept my job because I was traveling so much. It didn't really matter where I lived, to be honest. But when I went back to Buffalo, him and I drummed up what our plan would be, and we eventually bought our first rehab property and did that flip. And from there, it's gone in many different directions, which is exciting.

Cool question. Are you from Buffalo originally? From Buffalo originally, yes. I love how you don't consider yourself from New York. I think it's great. I'm a real New Yorker from actual New York. And you're from like Buffalo. I know. It's completely different.

Yeah, a lot of people think it's a short one hour drive to get from Buffalo to New York, which is obviously not the case. So, yeah, definitely from Buffalo, proud of it. And I'm glad to be back in the area. Nice. Is that where you do all you're investing at is Buffalo now? I do all my investing in Buffalo. Yes.

I actually live in Rochester, which is about an hour down the road. it is my wife works here and that's why we live here but all of my investing is in Buffalo currently yes so some context for those who don't know Buffalo Rochester upstate New York

pretty close to Canada definite Rust Belt definite like economies are not in the greatest of places and housing stock there is highly inexpensive relative to the rest of the country

yeah what's a typical house go for I mean, what's the low end? Yeah, the median price is about $150 for your typical house. The low end is as low as they go, similar to Detroit and all that. You can get houses for $5,000. We don't invest in those areas. And then there's your nice neighborhoods that you can get up in the millions for sure. But $100 per square foot is really your typical price point in Buffalo.

Okay. Sounds pretty similar to where I'm at. So you started, you know, you had this idea to flip. You got your carpenter friend. And how old were you at the time? We were 22, when we thought about it. I think we bought our first. We were 23 about a year later.

So let's talk about the first. Did you guys go in and buy it together? How much was the property? What did the whole process look like? Yeah, we actually, we definitely ran before we walked in that we started an entity right off the bat, started an LLC. We're going to do this. We're going to conquer the world.

So we went in together 50-50 partners on an LLC and we purchased the first property for 80,000. We put in 35,000 and we eventually sold for 140 when we account for all of those other costs that a lot of people tend to forget. We pretty much broke even when we take out real estate commissions, holding costs, everything like that. So we broke even on that first one. And that was with us doing some of the work, quite a bit of the work. So not necessarily profitable by my standpoint. standards today for sure. But that first one to not lose money was really exciting. And a lot of times I think that that is a victory in itself on a first flip.

You know, I tell a lot of people that when you get into flipping, a lot of people lose money on their various first one. I mean, it's an education and it's expensive one. I mean, I don't think that's a bad thing at all. The fact that you jumped and you did it, you didn't pay somebody $50,000 or $70,000 to take a course to learn how to do it. You just went out and did it and you broke even, but you learned. Right. Yeah, and that was what we were so excited about. Of course, we wanted to make 30, 40 grand and, oh, this is going to be it. But we came away so excited by the fact that we learned so much, like you just said. And just the fact of buying a house, if you think about where you're at when you're 22, 23,

the idea of purchasing a property is a bit overwhelming, but to close on it on the front end. And then again, on the back end, was just a relief off our shoulders to know, we can do this. Now let's take our learnings and apply it to the next one and the next one. I love that. How did you finance that first deal? that was a private lending so that was definitely the biggest obstacle to get started when we formed this LLC we made this beautiful business plan here's how we're going to flip houses to conquer the world and we just immediately started meeting with whomever we could friends family this ended up

being a friend of a friend of a family member who had a self-directed IRA and didn't know what to do with it and pretty much trusted just us as you know these guys will pay me back We were able to get the lending for the purchase and the rehab of that property on an interest-only loan at 12%. So 12% interest-only, and obviously he got paid back. Yeah, he did. It took a bit longer. We set six months. It took eight or nine, but we just paid that extra interest and he was happy. He saw the house when it was complete, solid pictures, was really excited about it. So he got his money, and he's still one of our big-time lenders. So I'm very excited. that that worked out, of course.

Yeah, awesome. That's awesome. I love, I love private lending in that. There are no specific rules, right? Like, yeah, you were just getting started, you know, but if you asked enough people, you talk to enough, you network enough. There's always people with extra money, not sure quite what to do with that. I think that's great. And that's certainly the case. I mean, looking back to it now, the business plan we made is must have been laughed at by many, knowing that we've never done it before. But the fact that we went that step of putting it together, they should have showed at least that we were serious. But now what we're able to do, of course, is to take our portfolio and bring into private lenders. And the network continues to grow from there.

So now we have lenders who are third, four, fifth degree people that we know. And we're a lot more serious with, there's almost no limit to the funds that they're able to lend. Yeah. And you know, you mentioned this idea that, you know, you guys didn't make a whole lot of money on the first property. But, you know, holding that 12 percent interest loan for eight, nine months or whatever, the lender made a good chunk of money on that.

So he made much more than you did, or he or she or whatever, made a lot more. Absolutely. I've done that so many times. But it's great. Yeah, and that's what we put into like the one biggest point we put in our business plan that we made bold was we pride ourselves in making our

lender's whole. And that is the key to this business because without that, we can't get started unless we have a huge bankroll, which we didn't and most people don't, it's impossible to get started without your character and your lender seeing that and knowing that they're going to be paid. back. And it's amazing that at 22, 23, you were able to convince somebody to actually lend you

the money in the first place. You know, we get so many people who come to us. I mean, not a day goes by where I don't get an email or a private message from somebody who's like, hey, I'm new. I'm broke. I don't know what to do. How do I get to start? How do I finance this?

What do I do? You know, I have no hope. And there's options. I mean, a little, no offense, a little kid at 21, 24. too. You're able to get enough money to do this. That's fantastic. And it's a testament to the fact that anyone can really do this. You just have to really work hard and utilize your capacity to find the resources. Right. Absolutely. Yep. Yeah. Prepare. And honestly, the most important things to take that first step, have that first meeting. Even if it's with your uncle or with somebody you know doesn't

have enough money or will never lend to you, have that meeting. Get, feedback and move on to the next because until you do, you're going to look like that little kid. It's making that conversion to hear somebody who has no idea what they're doing or here's somebody who I know I'm going to get my money back from and they're going to work hard to make sure that happens. So I definitely think that's a solid piece of advice. A lot of people stop when they think I don't have the money. You should start at that point and just start talking to people. Let me ask you a question about that kind of wrap up that first flip. You didn't make a lot of money. You did a lot of the work yourself. What went wrong? Yeah. Why didn't you make a lot of money?

I think the biggest thing that, well, we bought it for too much, certainly. Our rehab budget wasn't too far off. Ended up spending that $35,000. We were close to that. I think what we did in our ARV analysis, we were naive to the qualitative factors. And this is something that I would say is a big pointer that we've learned. You can do a lot of quantitative analysis on what you're going to sell it for later, what's your price per square foot, what our house is going for in the market. What we refused to acknowledge was this house, it was a three-two, a great neighborhood, everything was good about it, except it was a, you know, a one-and-a-half story. It didn't have any dormers on the second floor. So those bedrooms had ceilings coming into it, you know, you're going to knock

your head if you walk to that side of the ceiling. So we ignored that. We said it's a three-two, it's 1500 square foot. It's going to sell for 150,000, $100 per square foot. This is what the numbers tell us. We were not. and we ignored the fact that, hey, nobody wants to be banging their head when they go to sleep every night. So I think that was one thing. We were so excited to get in. We ignored those things that were staring us right in the face, you know? Yeah. Yeah, I like that. I never heard anybody to talk about it quite the way you just put the qualitative versus quantitative sort of numbers. Right. And it definitely, we've seen a time and again, getting rid of quirks is probably the

biggest piece of advice how to have to anybody starting a flip. In that, you have a house and everything looks good on paper, but even the style of house can throw off your ARV. For example, we had a raised ranch we recently sold. That's something we learned that a raised ranch, same square footage as a colonial, not necessarily going to sell for the same amount. People don't really like that style of house. And you have to pay attention to those things. And you have to make sure your comps are as close as possible when it comes to those qualitative features. I had a guy the other day sent me an email from Bigger Pockets, and he just said, hey, I'm looking to start my first flip. I found the property. I want. What do you think? And I looked at it. And I don't have time to look at

every flip, you know, like people send me, but I looked at this one. And the first thing I noticed said the first line of the description said, one of a kind property. And I immediately email it back and said, no, don't do it. Like I've been there. I've done that. One of a kind property. It was like some huge house that didn't belong in the neighborhood. And it was so great because it was like, you know, nine bedrooms or something. I'm like, you know, it might be a cool house. But I don't know. I like flipping boring houses now. Like I want, what is everybody in the neighborhood want to buy, that's what I want to flip. Like what's just a normal cookie cutter or whatever house? Anyway.

Hey, Nick, so you've got this one deal. You closed on it. You're done. You know, break even to potentially, you're slightly down. Where are you guys now mentally and what kind of comes to follow? Well, what happened almost simultaneously with that first flip, a month after that first flip, we actually bought our first rental. And the reason I don't talk about it as our first project in that we came back to i came back to buffalo and the immediate thing was live with your parents right because it's free and easy so we needed to find a place to live i did he did um so we found a three unit house to buy we thought well why don't we buy it rent it out um the rest of it and we can kind

of have it pay for itself the whole house hacking thing so that was our next deal and i would say that that did more in spawning the rest of my career than the flip did and that it opened my eyes to this I don't have to just stick to flipping houses. For one, the margins might not be that huge. In Buffalo, for example, where houses aren't going for millions of dollars, the margins aren't as big. So what is this whole rental thing? And I discovered that by buying that house, again, with my business partner,

we're living as roommates, kind of like college again, and we're renting out the others. And that opened our eyes. So then from there, we were both still working, but our idea was let's keep doing more part-time, let's buy another flip, let's do another flip, let's see if we can buy more rentals, and we'll see how that goes. And we did that very slowly over the years. We did about a flip per year for the next two, three years. We picked up a couple rental properties until 2014 hit when we started

really getting serious about let's make this a full-time thing and let's make this into a business that can sustain itself. That's awesome. Well, let's go back and talk about that rental a little bit. Did you say that was a single-family house and you rented their bedrooms or was it a multifamily? No, it was a multifamily. It was a three-family house. A really great first floor unit, an okay, second floor, and then a basement unit with the egress necessary. So we lived in the middle unit, if you will. So we kept the best unit renting, and we actually did a very quick rehab on that basement unit to increase the rent a bit on that. And while living there, we came close to breaking even, which worked out really well. And like I said, that opened our eyes. We didn't know anything about property management.

That was a great way for us to cut our teeth. We had really good tenants who understood that they needed to respect our time. And we started immediately, even though we lived right there, but we started immediately treating that whole thing as a business. We started invoicing as a business. Maintenance requests came in as a business. You knew us because you lived near us, you know, same house, but you must treat us as a business of property managers.

I think that's what made that so successful as a, as the first rental property. So how did you as a 23, 24 year old guy with another guy living with you, I mean, like, how did you position yourself as a person in charge? Right. I struggled with that a lot early on. Yeah. Well, a lot of it was branding. So we had that LLC that we started. So we had our company, New York Home Solutions. And we worked hard to build up a website and build up a brand and a logo and we used quick books and we did things as if a business that had a hundred rentals would do it. And I think that that really helped. I don't know if our tenants really knew that this was our only rental. They might have. I'm not sure, but we sure put on the front that we knew what

we were doing. We're professional about it. We dressed the part. That's another important thing. You know, you dress like a professional and you act like professional. You're going to be treated like one. And that helped quite a bit with this first rental. And then, of course, subsequent ones after that as well. Yeah, I think that's huge. I mean, I know that like, I tend to tell people don't spend too much time on your, you know, business cards and your logos and stuff, but there is that case where that comes in really handy is when you look professional, when you run your business like you have 100 units. I love that you said that. You know, even if it's your very first one, run it like you have 100 of them. Because then you can

scale to 100. Yeah. Yeah, and especially when you're young and you're doing this, you know, again, it just, it keeps coming back for us. You know, you get all these young folks on BP who are like, hey, I don't know, you know, if I'm going to be taken seriously. Well, make them take you seriously. There's lots of ways to do it. One of the ways is to be professional and done, easy. Yeah. Yeah. Yeah. Yeah, we did kind of the same thing. For a while, we didn't tell our tenants that we were the owners. We were, you know, we had a property management company and we were the managers of the property management company. That's all they ever knew. So most of our early tenants didn't even know that we were the ultimate owners. Or if they'd ask, I'd say, you know, yeah, I'm one of the partners in this company,

but it's a LLC and there's other members. And pretty soon it's just over their head and they don't bother to figure out what that actually means. Well, and I don't really want them to know what the intricacies of my business are. So that helped a lot being able to say, you know, like, well, you know, this is a business. I'm just part of it. I'm just one cog in this wheel.

And this is why the rules are in place. And so that definitely helped me as well, just treating your business like a business. I think that's great. So, yeah, house hacking. I love it. Very, very cool. So we've got the rentals. We're starting to build this up.

You know, you're doing the one flip. year. You talked about 2014, you started getting serious and turning it into something, you know, bigger and better. So, I mean, give us the quick overview. Where are you today? How many, how many buy and holds? How many flips have you done? And then maybe we'll kind of cut back and dig in a little more. Sure. Yeah, yeah, we've done about 10 flips. We have 20 rental units currently that we're managing. In addition to the flips we're working on right now, kind of a value-ad refi deal that we're flipping and then we're going to refi. So that's where we're at today. And I'd say probably maybe half of that has happened in the last year since August of 2014

till now. So that's kind of the growth we've seen in the year. Okay. Talked about the scaling. So one a year, one a year, one a year, one a year, and then boom, it's on. How do you transition to that? Well, well, the biggest thing was we went full time. So we were doing everything up until that point as part-time. I was traveling all over the country, all over the world, and it was honestly not the way I like to run a business. My business partner, Costa, was working still as a carpenter full-time. Anything we did was nights and weekends. So the stepping away from our other jobs to go full-time was huge, because now we could establish our systems to take things on at scale. So what that means is our project management system, our system, our cloud-based management of documents,

and our cloud-based management of property management, all of that really came into play about a year ago when we said, here is how we're going to manage our maintenance request, for example, it's going to be completely online, we're going to manage our workflow using Podio is what we do. And we honestly, that's just an example. We just established systems for everything. When it comes to marketing, when it comes to analyzing the leads that come in, here's the system, here's the script, here's how you enter it into the system, and here's how we go through our workflow. So that really helped us a lot to get going. And I must say, I can't say that here we are churning on this business that just runs itself.

We're still very much involved. We do a lot of work still. And that's by, you know, on purpose, the fact that we are on our own right now, we need some income. So I'd say the biggest thing we did when we went full-time, if and when we were involved in rehabs of projects, it sounds crazy, but we paid ourselves. So if we were to budget, say for my business partner Costa to put in cabinets $3,000, he would get that $3,000 check. So we are still involved a bit.

And we're playing that game of subbing out a lot, but we're still into it. But we're at least paying ourselves. And that's been a huge change in how we run our business. So this is something I talk to people a lot about, this idea of, you know, run your business like a business. And, you know, some people will say you shouldn't do any work in your flipping or in your rentals. You should outsource everything and be the business owner. And I don't think that's the case. I think I like doing work a lot of times.

I don't have a lot of time to do it anymore. But, you know, the key, though, the difference is what you're doing is that you're treating yourself as almost like an employee of this business. So you are just one cog in the wheel of the business. So you could replace yourself with someone else and your business wouldn't implode. And that's the difference. Exactly. Yeah. This is our point of transition. We are going from doing this part-time.

We're now doing it full-time. Now, it's not enough. We can talk about it later, our support systems. This is not enough. If I were doing this by myself, this would not support my lifestyle. So a way to mitigate that is to, okay, well, we pay other people to do work. Let's pay ourselves. This is the intermediate step before we go completely passive.

And that's how we treat this right now. and we're going to slowly, slowly work ourselves out of it. And we've done that to this point. We sub out way more now than we did in the past, and we're getting to the point where Costa's role will not be putting in cabinets anymore, but it'll be bouncing around to different projects and making sure that the other carpenters that he manages are doing that. Yeah, I like that.

So would it be true to say, like you generally run more of the, is that the numbers, the finding deals, and he does more of the business side or the construction? Yeah, that's definitely accurate. So I would say that I would do business development, finding new leads, negotiating deals, although we are both in on what we pay for properties, what we sell properties for. And then the overall project management in the business system. So setting up our Google Drive, our Google Apps for Work, setting up Podio, which we use a lot,

Asana, we use a lot. And really managing our lenders is another big thing that I would do. And yes, Costa would be a technical project manager in that he is on site. he knows exactly what needs to be done. He knows how it should be done, and he can report to me if that's happening on our projects. So I've got a question. I mean, we've talked to lots and lots and lots of people over the years we've been doing this. I've seen lots of posts on bigger pockets. I've rarely heard somebody at your stage paying yourself a salary. Frankly, if I were a private investor, I wouldn't give

you money to pay yourself. I'm surprised that they do. So how does that, how has that conversation gone, at least with the folks that are lending you money? Because I, you know, I get it from your perspective. I totally, totally get it. Yeah, it makes logical sense. I'm doing some work. From the other side, it's, yeah, I'm giving you the money. You do the work. It's part of the package and you reap the rewards at the end of the day. So how does that kind of work out in the conversations for you? Sure. It's all about focusing on the equity that's getting added to the house or the flip or whatever it is.

So what our lenders are concerned with is a loan to purchase a property agreeing that it's worth that much. And then we'll work out a draw schedule and that as work is completed, they'll provide other draws. And as long as there's the equity there, then they have no problem putting money into it. So in this example, so equity in that we're adding, let's say, a floor to the house, right? So we put it into our construction budget. It's going to cost $3,000 labor and materials to put in this floor. Once it's complete, the property's equity will go up at least that much, right? And the lender agrees that that makes sense.

Once that floor is in, we'll give that money and that draw. they don't care who does it as long as the equity is there they know that we do it and they know that we do it right i think that's definitely another important point to your question they know that we've done this before and that we're licensed insured contractors and we can't do it as long as the equity is there and that their investment is protected should they need to foreclose or anything like that they have no problem with that yeah and i think i think that's where like if i were a private lender lending on it i wouldn't have the as big of a deal because i know that you're going to pay three thousand for that floor no matter who does it. I would rather know that somebody I trust was doing

the work. Even if it's going to cost $3,000 no matter what, at least you're doing the work, I could trust you versus some Joe Schmoe you're going to call off Craigslist to go do the work for $3,000. I'd rather pay you the $3,000. So it makes sense. But I get Josh's point, too. It's a weird thing. Like, why are you making money before they are? I've never heard of that before. Have you heard? I mean, in all the years I've. I've done that a number of times. I paid. I paid myself. Like, when I, especially like hard money, like they were all right with that because they said, you're getting this much based on the ARV. This is how much we're giving you.

I don't care how you spend it. As long as the house gets done, do what you want. It's kind of how I've been so much you're doing. And now the listeners have learned. I want to circle back a minute to something you mentioned. We just briefly covered it, but I love that you said this,

is the idea of you create systems for everything that you do in terms of finding leads, in terms of all that stuff, you have systems. And you use Podio, which I've never used, but I hear a lot about. Can you talk a little bit more about that?

what that looks like and what do you mean by the systems in Podio? Yeah, Podio is fantastic. Well, we use Google Apps for Work as our main, you know, there's our email, here's Google Drive, all our documents are digital. We pride ourselves on that. Podio we've discovered, I don't know, six, seven months ago. What Podio is is pretty much a customizable database. And what you do is you create different databases and they talk to each other.

And you can set up workflows within those databases to manage pretty much whatever you want. So in the example that you're asking about property management, what we do is we set up our units. They're connected to our properties, and our units are connected to our tenants. We can have vacancies connected to all of that. And ultimately, maintenance requests as well. So we create this relational database of units and tenants and maintenance requests and applications and information. They all talk to each other. And it's completely customizable. So we can add fields that we think are necessary. And then we create workflows and we give our tenants, here's how you submit a maintenance request. Once it hits, we set up the workflow to email Costa, who gets it and says, I have a new

maintenance request. He sets the status and alert gets sent back to the tenant and that's how we work the whole thing. The best thing about Podio, when you compare it, so obviously there's at folio and building. There's plenty of other solutions for this. What we love about it, one, it's cheap. It can be free or just a few bucks a month, but it also is the customizable of it. My property management database talks to my flipping database and I can have them interact with each other. It talks to QuickBooks. It talks to my finances. And to be able to customize all that is really the value ad we find in Podio. And it's been fantastic for us. And we're trying to just use it more and more and find other ways to take paper away and use workflows in the digital cloud.

Very cool. That's great. That's great. When I bought my first rental, I thought collecting rent would be the hard part. Nope. The admin crushed me. Every night was receipts, tax forms, and checking who was late on rent. I kept thinking, if this is one unit, how do people run 10? Base lane changed that. It's Bigger Pocket's official banking platform that handles expense tracking, financial reporting, rent collection, and even tenant screening all in one place. It's the system I wish I had from day one.

Sign up today at baselane.com slash bigger pockets and get a $100 bonus. Baselane is a financial technology company and is not an FDIC insured bank. Bank banking services provided by Threadbank, member FDIC. Here's the truth about passive investing. If the strategy isn't right on day one, the returns won't save it. Multi-family real estate offers structural advantages. Many investors are overlooking, including depreciation that can help offset taxable income while cash flow continues. Bam Capital builds its investment with that reality in mind.

They are focused on solid operators, taxing. efficiency and long-term performance. For investors who want real estate exposure without being landlords and who care about consistency over hype, this is a smarter way to allocate capital. Learn more at biggerpockets.com slash bam. All right, rental property investors, listen up. Our friends at Dominion Financial already have some of the best DSCR rates in the industry. Now, they're the fastest, too.

They just launched 10-day DSCR closing. That's right, 10 days. And they're still the only lender with a deal. DSCR price beat guarantee. That means faster closing, the best terms, zero guesswork, that's Dominion financial. Check them out at biggerpockets.com slash dominion. Again, that's biggerpockets.com slash dominion. Cool. So you're part of the business is the running of the business. You know, you seem like a pretty serious and businessy kind of guy, which is good. I mean, well, by the way, so you came from IBM. I'm like, where did you go to school?

I went to Carnegie Mellon University. That's really funny. I was going to say, Carnegie, you definitely went to one of the math schools. I don't know why. Yeah. So you went to Carnegie. Yeah.

It's definitely quantitative, right, yeah. Worked IBM. You've got that mentality. How are you finding deals? Because I could see you crunching numbers and everything that you do. Right. Let's kind of educate some of the folks who don't have that, right?

What's your path? It's your method. Yeah. Well, immediately we talked about setting up the branding. I set up a website, way before we should have maybe we had no business having a website we flip house but we don't know how to yet um nice but we have a website set up decent traffic we don't spend too much time on that it looks

great we have we updated frequently we have a lot there i don't spend too much time on it um really we found our deals through the mLS uh here and there we have a really strong agent who is connected to both listed properties and then some off-market listings. He's got some good connections with investors that might not hit the market. We found a couple properties through him. So that helps quite a bit. Our website does receive some traffic. We get some leads through there.

And then there's so much word of mouth and networking. I say again and again to my business partner is don't stop talking about yourself and what you do because we found certainly our best deals this way. and just deals that you would never have thought are going to come about. You know somebody who knows somebody who knows somebody who knows somebody wants to get rid of a property, and that's how you find one. So we haven't spent too much on marketing yet, but I think that the networking has been our biggest, our biggest, you know,

it's led to the most deals, for sure. And that's cool because that's something that anybody can do. If you're brand new, if you have no money to get started, if you're very, like, you know, thrifty here, it doesn't cost anything to talk about yourself. Right. Yeah, I love that. Exactly. So what are some good tips for getting started?

started with the networking. Well, obviously within your spheres of influence. So I was lucky enough my father was a businessman connected to the community, a little suburb outside of Buffalo. So I immediately started talking to his immediate network. And again, we might have been laughed at a bit. You know, here's my business plan. Here's what I want to do. Here's what I'm looking to do with my business. They probably don't care, but they're going to tell somebody. That's where we started. That's for sure. And then that kind of spreads here and there. Family and friends, even though you're always going to have that uncle at Thanksgiving or Christmas who talks about why you should or shouldn't invest and how you should do it. You have to ignore that and move on and just,

you know, nod your head because it's the other family member who didn't make the comment who's going to come to you in a year and say, you know, here's a friend who wants to sell their house for really cheap, right? It happens. It's a fact. You need to talk. Of course, the bigger pockets meetups are huge. I go to both in Buffalo and in Rochester, which is nice to be able to go of both of those. And then the last thing I would say is that, and you can't really do this until you have a property here too, but I have to say the marginal difference from having zero to one property is huge because when you're able to say I invest in real estate as opposed to I want to invest in real estate, it really turns a green light on. So I have to say getting that first

property is huge, even if like in our case we didn't make a ton of money, but we could say we've done it before and that really helped out a lot. So I think that's key for anybody wanting to get going buy something. As long as you're not losing too much money, it's okay to lose a bit, break even. Maybe you'll make some money. And at least you can say that you've done it. Yeah. I actually love that. I love that advice. Just get out there and take action. Start moving, start doing something. You know, it might, you might not make a $50,000 on your first flip, but, you know, just moving forward, taking those steps, you know, because the next one's going to be better and you're going to learn, you're going to learn. Just obviously don't get yourself in trouble

over it and, you know, go bankrupt moms, you know, 401k or something. But, you know, You know, but yeah, I mean, like, do what you got to do, take action, move forward. I love it. All right. So let's see. You mentioned just in case people, because we touch on it real quickly there, the BP meetups. So what those are in case people aren't familiar, basically bigger, they're unofficial, bigger pockets, members just get together all across the country.

I mean, there's probably hundreds of them at this point that just happen spontaneously. Sometimes they're, you know, big, sometimes they're small. Sometimes there's 12 people in a room. Sometimes it's 150 people in a room. You know, usually they're at, I don't know, anywhere from a local bar. a restaurant to an actual like networking place. You know, I've probably been to 30 of them or 40 of them in the past couple of years.

I mean, they're fantastic. I mean, there's no like, generally not an agenda. There's not like a paid speaker usually that's coming in to sell something. It's just let's get real investors, just like the forums together,

talking about their business and networking. And I love it. If people want to know where there's, their next, I guess, meetup is. Make sure you guys set up keyword alerts on bigger pockets. Let's go to biggerpockets.com slash alerts

and entering your local city name. the big cities around, you know, within a 50-mile drive of you or 100-mile drive, set up those alerts. And when anybody announces a meet-up, you'll get a notification. And, yeah, good way to kind of connect with other people. I love them. There's actually one last night. I wasn't able to go to last night, but there was one in my area last night that, you know, there's probably 60 people showed up there. So anyway, very cool. That's great. That's great. So what's what's the plan? I mean, you guys, you know, you've got my 20 rental units, you've done 10 flips. I mean, you guys are full-time in on this thing. Obviously, it's not a side business. You quit your job. I mean,

you were working at a Fortune 100 business, probably making a nice, you know, pretty hefty salary that a lot of people would envy. And so, you know, to stop that and go full-time into real estate investing on, you know, these small rental, I'm assuming they're all houses that your rental houses. Currently, yes, yeah. Okay. So what's the plan? Where are you going? What's, you know, what's the next year, two years, five years look like? Yeah, so our main plan is structured on, we're both 27, and by 30, hopefully before that, probably half of that is my real goal, is we want to get all of our rentals up in cash flowing so that the percentage we take away a salary is enough to sustain comfortable living

in Buffalo, which, to be honest, is not much, right? And then from there, we want to level set at that point, and then from there, continue building up the units and we want to treat flips as bonuses, if that makes sense. So what I want our business to look like is our rental units, our income, that's our salary, that's our base salary. Every flip or every, you know, big time value add, refi that we do something like that, cash influx, that could be treated as a bonus should we decide that's the best use of it for the business. So that's where we want to get in the next year and a half to three years. We see that being about 50 units. We could do that just based on the units we have.

have now. So we're aggressively trying to get there. And I guess, Josh, to your point, on leaving the job, it's true, you know, leaving the job was tough because it was, you know, six-figure income. It was great. The best thing about it is if we fail or if we don't get to where we need to be, I can always go back. And, you know, if those listening or people are thinking about it, leaving your job, just make sure you do it. And in a way that is amicable, people understand. you want to leave your job, you want to do something else, keep those relationships alive because if you fail,

you can always go back. It's not an impossible thing. Okay, so you want to go, you want to, in the next three years or so, have the sustainable income through 50 units, then, you know, you get your little bonus flips and things like that. What about five years, what about

10 years? I mean, do you see yourselves, I mean, you know, building an even bigger portfolio or you want to just kind of kick back at that point, relax? Well, I think at this point in time, I can tell you what I see, but I can also tell you that it probably won't happen. What I see is, is continuing, we do have an apartment building that we're under contract for. So we are going from houses to apartment buildings, small apartment buildings, and we do want to continue to grow that into large apartment buildings. That's the

current plan. When I say I can't really tell you what's going to happen in five years, it's just because everything is so iterative. When I started this, I thought we were going to flip houses, and that was going to be the magical way to financial freedom. That was going to be it. And then a month later, I got rentals. I said, whoa, what is this over here? So that's our plan right now. We're going to keep building up. We want to go bigger and bigger apartment buildings. We want to get up to 100, 200, 300 units, sure. But we don't know where it'll go. We actually just had, we've been having, many people ask us if we would renovate their houses just for cash, just as general contractors. Maybe that's something we want to explore. Maybe we'll get into custom home building,

like that. So we don't really know where it's going to lead, but I can tell you the current trajectory is to continue building those units up into the higher volume apartment complexes. Right on. And I love the iterative plan. I think it's a smart approach. I think, you know, a lot of people find themselves, you know, hey, I'm going to be a flipper. I'm going to be a flipper because it's a great way to make all this money. And then they're like, oh my God, this is a job. This is like, you know, flipping is just, you know, tons of work. And that's okay. But I like having that mix where you're building the portfolio to pay for your lifestyle. And then the flips kind of come in with this little extra cash influx whenever you do them.

And then you just keep building lifestyle up. That's great. Sure. Yeah, I think, I mean, you could attribute to this too. I mean, bigger pockets, for example, when you started it, you probably didn't think about a publishing business and the podcast and all that stuff. And so many things changed. And just the ability to adapt is what we're trying to stay focused on is that we don't know what we don't know yet but being able to change is important yeah I love that love it well cool hey let's shift gears a little bit and head over to the world famous it's time for the fire round all right the fire round these questions come direct out of the bigger pockets forums which I hope every listener is engaging in on a daily basis because it only takes a few minutes.

Yeah, BiggerPock's going to find you and make sure you do it. I'm going to or next going to. Yeah, I don't know. You made a real veiled threat right there, Brandon. All right, fire on questions. These come from the forums that you can get to at biggerpockets.com slash forums. So number one, how do you get the funding? We kind of talked about this already, but we'll talk about it a little bit more.

Maybe you have more thoughts on it. How do you get funding to do your first rehab deal if you've never done one before? Yeah, it's almost has to be. you know, family friends or friends of those family and friends. It's hard to go straight hard money on your first deal. Even hard money lenders like to see experience. That's true. Most hard money lenders like to see money down. That's true. So it almost has to be family and friends. Now, that doesn't mean you just think of your friends, your family and say, well, nobody I know has money. It expands from there and it has to. So start there, start talking to your parents, your grandparents, your

aunts, your uncles, your friends. And that will lead to more. It's like a spider web that continues to expand. Just keep growing that network. And eventually you'll get in front of that person who wants to gain 6, 7, 8, maybe 12% with somebody they can trust and a tangible asset, which real estate is. Yeah. And one thing to add on that, it's, you know, when I first started, my very first flip was a live-in flip, which is also kind of part of, it's like the cousin of house hacking. I got a normal low-down mortgage, long-term, 30-year fixed mortgage on just a kind of a crappy house. You know, it was still okay, but it was just kind of a crappy house. And I fixed it up and I sold it and I made some good money.

And that became my look, I've done this before. I have experienced. Therefore, then the next flip, I was able to go get hard money because they saw the first one. And that was, yeah, the whole thing cost me, I think a few thousand dollars. And, you know, if that. Plus, yeah. Plus the potential tax benefits, too. Exactly.

If you live in a two years, yeah, you can do it, make some good money, be able to roll that into the next flip. Yeah. So very cool. All right, number two. Number two, and I think you answered this. I think you mentioned QuickBooks. But do you use QuickBooks to track expenses during a flip? Yeah, I do. The way that we do that is we set up our accounts as an asset account on the construction and the subcontracted services. So as we spend money on, say, buying, flooring or something, it goes as into our asset account so that our equity in that house increases as well, if that may be. sense. So of course, we use QuickBooks to track everything, and that teams up with our analysis spreadsheet to see how profitable it is. But from an accounting perspective, as you put money into

your house, it shouldn't really be tracked as an expense, but more of a capital improvement. So we keep it as an asset. Interesting. Cool. I'm a lot of that one over my head, but that's all right. I'm not a QuickBooks guy. I'm thinking about baseball right now. No, I love that stuff, but I'm just really bad at QuickBooks. And I wish I was better. So I don't know, maybe I'll teach her someday. Yeah, I'm sure some of the CPAs will to correct me potentially. But all it is in basic terms is, as you spend money on the house, the value of the house goes up. So we just account for it that way. Yep. Cool. Makes sense. Cool. Fair enough. All right. Number three, how would a beginner real estate investor

go about starting a flip? What are some steps to take before closing on their very first deal? Obviously, before you close, you have to get a lot of things in line, which you probably wouldn't be able to close unless you did. So property insurance is certainly one of those. But making sure, that your scope is as accurate as you think it can be. Get into the house as much as possible. What does scope mean? What does scope mean for those? Scope is the list of things that you'll perform during your rehab. So you're going to reconfigure the kitchen. You're going to buy new kitchen cabinets. You're going to tile the floors, all that. So be as detailed as you can be as far as what that scope looks like. Try to go room by room, floor by floor, interior versus exterior. There's a great

book, and I'll mention it later, the flip book puts together a really solid list to help you nail your scope. But just be prepared in establishing that scope and start finding some subs, if you can, start thinking about who your electrician is going to be, who your plumber's going to be. We recommend that you call at least three vendors, especially if you're getting started, at least three vendors for each of your tasks. And you can do that before you close in the house, and you should, because once you close, you're going to want to get that flip done as soon as possible. Perfect. Nice. Awesome. All right. Last question. What happens if you get a property under contract and you realize you don't want it? Well, hopefully we've built in some kind of out in our contract. So we always will set up a property inspection, even if we don't intend to do one. It's just something that's common and nobody really thinks twice about us, including a contingency on a property inspection. So that's always our out. Now, we'll usually use that to do a really thorough inspection. Sometimes we'll bring in a third party.

sometimes we won't. But that generally gives us a nice out. If you're in the spot where you've already passed that contingency, well, look at what your deposit is. Hopefully, your attorney and your real estate agent help to keep that low. But it's not the end of the world to back out. If you have a $1,000 deposit, it's a lot better to lose that $1,000 deposit than to get into a property that, for whatever reason, you're realizing is going to be a big time money pit. Yeah. Good. Good, good advice. Awesome. Love it. All right. Let's move on. to the last section of the show, which we call lovingly our Famous Four.

All right, the Famous Four. These are the questions we ask every guest, and I know you've heard the show before, and you listen, so you'll know what's coming. Number one, what is your favorite real estate-related book? Okay, there would probably be a combo of two books in the same series, if that's okay. The first, that really, when I said that flipping became tangible and quantitative to me,

this book called Flip, how to sell, or how to find fix and sell houses for profit. Is that the color? Bill and Clay Davis. Same series as that. And my next book would be that one, The Millionaire Real Estate Investor, by Gary Keller. So those two in tandem are my favorite, specifically for this show,

as we're talking about getting started. Those really put things into perspective. Flip is very step by step, and the millionaire real estate investor gives a comprehensive view of all the different strategies that can help make you successful. Great. Right on.

Right on. What about business? books, favorite business book. Okay. Again, I'll give a tandem, but this time by the same author. So a lot of people know the book, Think and Grow Rich by Napoleon Hill, which was a big game changer for me, and I recommend everybody read it as far as getting your psyche in the right mind to pursue some kind of profitable adventure. He also wrote another book that wasn't released until 2011. He wrote it in 1938. It's called Outwitting the Devil. And it's really interesting. it's a conversation between Napoleon Hill and the devil, and they really look at fear and how it stops those from taking action.

And specifically in this case, how Napoleon Hill was trying to get over that fear. So those two in tandem work really well for getting you to take the next step. That's awesome. Cool. I've heard that's a good book. I haven't read that one yet, though. I'll add that. What about hobbies?

What do you do for fun? I love to travel. My wife and I love to travel. We've been to many awesome places. and we kind of have developed a bit of a bucket list of places we want to travel and go and experience before we think about starting a family. So if we're not on a trip of some sort, we're usually planning one, and we get really excited about that. So that's great. Reading is also.

What's your favorite place you've been? Well, I'd have to say somewhere I've been with her. Sorry. That's for sure. So sweet. Santorini in Greece was fantastic. We went there, and that was amazing. So I've been to South Africa for work, and the Cape of Good Hope was amazing, but I'd like to bring her there.

I think it'll be a bit better with non-co workers. I think it could do a bit more fun. So then reading, you said, before I cut you off. Yeah, reading and in a bit, the real estate books and the business books, as we all know, sometimes you read a bunch of them and it sounds like they're repeating themselves. So getting into fiction and philosophy has been really great to take a break from all that. Yeah. Fantastic.

Cool. All right. Good. My final question, what do you believe sets apart successful real estate investors from those who give up, fail, or never get started? Well, it'd have to be without question and be fear. And I think specifically it's that focus on those potential negative outcomes. So when we think about deviating from society's norms, we are so caught up on what if I fail, what if I get lost, what if things don't go as I want, we're so afraid to stumble, we don't think about the potential benefits, right? The things we don't even know are possible with that first step. So, you know, my advice on that is you need to take action, whether it means going out and getting a moleskin and taking notes on what you think your real estate investing might look like. Maybe that's your first step or you're at the point where it's time to buy a property. Whatever it is, take action and don't be afraid to fail because more times

than not, you're going to succeed more than you'll fail. So that would be it. Cool. I love it. Cool. All right, before we let you go, where can people find out more about you? Certainly on Bigger Pockets, our company, NYH Solutions.com, New York Home Solutions, and also dabbling with blogging a bit, a blog called IncomeDigs. So Incomdigs. They can check out and see what I have to say as far as our experience goes with flipping and renting. Fantastic.

Yeah, awesome. Cool. All right. Well, listen, Nick, it's been a pleasure. It sounds like you're doing some really great stuff. Very impressive. and I just want to thank you for being part of bigger pockets and for coming out and joining us and sharing your story with us.

Thanks, guys. It's been a pleasure. Appreciate everything you guys, of course, and very happy to be part of it. Awesome. Thanks. We'll see you around. All right, guys, that was Nick Baldo, crushing it at the tender young age of 27 years old, and he's got great plans, and he's off to change his own little world. That is the enclave of Buffalo and improve that lowly. I was going to say you were very nice about Buffalo and Rochester. After the interview, Nick was like, I'm really glad you guys didn't bust my chops about Buffalo.

And I'm like, oh, well, now that you're not there, I'm totally going to bust your chops. Rochester, Buffalo, come on. Come on. Now, I mean, listen, we don't get a chance to talk about it too, too much anymore. But I want to see those places turn around. I mean, if Buffalo, Rochester, you know, Detroit and everything else are thriving. so too is the United States, so too is our economy. So I really do hope things continue to improve across the Rust Belt.

And guys like Nick are helping to make that happen. So it's awesome. Yeah, yeah. Before we get out of here, did you see that article? I think it was on CNN, Josh, the other day that said it might have been CNN or maybe Fortune or Forbes. Anyway, he talked about how like the banks, the big banks, it was like the big banks, or no, what was it, the big hedge funds adventure into real estate's not paying off for them. Did you see that?

Well, it's been happening. That has been happening for a few months now. Yeah, well, these guys went and bought like trillions in real estate. I don't know how much they bought. They bought a whole hell of a lot of real estate across the country. And how do you manage it? I mean, how do you manage thousands of buildings across the country without an infrastructure? They came in with no infrastructure. They were bound to fail. It wasn't going to work. I think that's part of it. I think the other part of it is they kind of led to the market, climbing, they led to this kind of housing boom, and now they want to be the first ones out as the market starts to soften. So, yeah, I've been waiting for this. It would be interesting to know their numbers. I mean, I don't know their exact numbers. By the way, the article is called I found it here. It's on fortune. It's called Wall Street's Big Bet on Housing. And then, of course, my page just changed, not paying off. So anyway, you can check it out. It came out on the 25th of September, 2015, if you want to go check that out. I mean, how do you do that, Brandon?

I mean, seriously, how do you buy property, thousands of properties across 50 states or even 13 states, you know, and manage that at scale? Yeah. I mean, obviously they have property managers, but you got to manage the, I mean, as we know, you have to manage your property managers really, really well because most property managers suck. And if they don't know how to do that, additionally, as you're rehabbing as well at scale, right? And you're rehabbing a scale, yeah.

having. And they're buying property at what was market rent or above market renter. Because everybody knows that when they were competing against those companies, like the last few years have been tough because those companies come in. They're like, they just write a check. They pay retail, yeah. They pay retail, whatever. So it was so hard to find stuff. So now all these properties were bought at what market value was and it hasn't improved all

that much. And now they're trying to. Yeah, interesting. So it'll be interesting to see how that pans out here. Well, how is it going to pan out? Is housing going to keep climbing or is housing going to, you know, soften and turn down? That could be a whole show right there. We should actually, that would be an interesting show.

Bring on some economists and talk about what the environment's going to do. So anyway, yeah. Could be. All right. Interesting conversation. All right, guys, well, listen, thanks again for listening. As always, we definitely appreciate it as Brandon insinuated earlier. If you're not in our forums, you really need to be joined bigger pockets, create an account.

It's free and start networking with guys like Nick and get out there and do it. BiggerPockets.com. Otherwise, get out there, make moves, take actionable steps like we had talked about, show 142, take action every day to drive your business forward and, you know, keep us in the loop as you continue to be successful doing that. That's it. That's all I got for you. I'm Josh Dorkin. Sign in off. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the height, you're in the right place. Be sure to join the millions of others who have benefited from biggerpockets.com.

Your home for real estate investing online. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing on YouTube, Apple, Spotify, or any other podcast platform. Our new episodes come out Monday, Wednesday, and Friday. I'm the host and executive producer of the show, Dave Meyer. The show is produced by Ian K, copyrighting is by Calico content, and editing is by Exodus Mears.

If you'd like to learn more about real estate investing or to sign up for our free newsletter, please visit www.w.com. The content of this podcast is for informational purposes only. All host and participant opinions are their own. Investment in any asset, real estate included, involves risk. So use your best judgment and consult with qualified advisors before investing. You should only risk capital you can afford to lose. And remember, past performance is not indicative of future results. BiggerPockets LLC disclaims all liability for direct, indirect, consequential, or other damages arising from a reliance on information presented in this podcast.