BiggerPockets Real Estate Podcast - 640: How to Buy Your First 3 Rental Properties (Step-by-Step) This Year!

Episode Date: July 26, 2022

Knowing how to buy your first rental property can be the difference between you building a life of financial freedom or merely treading water working for active income. The life of a real estate investor isn’t glamorous, but it leads to generational wealth, time freedom, and the ability to do what you want, when you want, with who you want. The first step to becoming a real estate investor is buying your first real estate deal. This first step is where ninety-nine percent of people stop, but it’s where you will start. Dave Meyer, VP of Data and Analytics and host of On The Market, has built a financial freedom-permitting property portfolio over the last decade. He doesn’t have thousands of units, but even with his medium-sized portfolio, he’s been able to travel the world, live abroad, and continuously build wealth. He’s here to teach you exactly how to do the same by buying your first, second, or third real estate deal in the next 365 days! If you’re able to do so, you will see your life start to change before your eyes. Money will be easier to find, deals will come your way, and passive income streams will be dug in your direction. If you’re able to buy your first (or next) deal like Dave describes, put systems in place for future purchases, and slowly build a team around you, your dream rental property portfolio won’t be too far away. In This Episode We Cover: The 3 “Ds” of real estate investing and how to get over their obstacles Why every smart investor continues to buy even in murky housing markets like today Building the “LAPS” funnel that will send real estate deals your way How to analyze a rental property for free using the BiggerPockets rental property calculator The different types of ways you can buy real estate with no money down  Why the first three real estate deals matter more than most people think And So Much More! Links from the Show BiggerPockets Youtube Channel BiggerPockets Forums BiggerPockets Pro Membership BiggerPockets Bookstore BiggerPockets Bootcamps BiggerPockets Podcast Get Your Ticket for BPCon 2022 Listen to All Your Favorite BiggerPockets Podcasts in One Place Learn About Real Estate, The Housing Market, and Money Management with The BiggerPockets Podcasts Get More Deals Done with The BiggerPockets Investing Tools Find a BiggerPockets Real Estate Meetup in Your Area David's BiggerPockets Profile David's Instagram Listen to Dave on The “On The Market” Podcast: Spotify, Apple Podcast, & BiggerPockets BiggerPockets Rental Property Calculator BiggerPockets Rent Estimator BiggerPockets Agent Finder BiggerPockets Deals for Sale Already a Pro Member? Use Code “PRORENTAL” to Get All the Upgrades Mentioned in This Video Books Mentioned in the Show Real Estate By The Numbers by Dave Meyer BRRRR by David Greene Connect with Dave: Dave's BiggerPockets Profile Dave's Instagram Click here to check the full show notes: https://www.biggerpockets.com/blog/real-estate-640 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Check out our sponsor page! Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 640. What's up, everyone? This is David Green, our host of the Bigger Pockets Real Estate Podcasts here today with my sidekick, with my co-host, with my buddy, Dave Myers, bringing you a special episode. Look, we realize the market is shifting. And that means a lot of different things, one of which you should be listening to as much content as you possibly can to stay abreast of changes so you can position yourself

to be in the best place possible. Much like Brandon Turner trying to catch away. You want to know what waves are rolling in, what they look like, and how they're different than the wave before, so you can pick the right one and be in the right spot when it breaks. Also, if you have not yet got into real estate or maybe you own one or two properties, this is a very good time to scale your portfolio. Now, of course, you want to be investing from a position of financial strength. We don't want anyone to go and buy real estate they can't afford. But if you have been saving, waiting, this could be your moment to shine.

And in today's show, Dave is going to give a presentation of just what you can do, to get your first second or third rental property. Dave, what do you think? That's a beautiful explanation of what we're talking about because it is a really interesting time to start investing. And I understand that a lot of people are fearful about the market because there's a lot of hype and there's some scary headlines out there. And in no way am I, or is David saying that you should go out there and buy just anything.

But if you are someone who knows how to analyze deal, and how to get good leads, this is a really, really interesting time to start looking into the market right now because competition is going down. We're starting to see prices look a little bit wobbly. And although I personally think prices might decline a little bit, there's not going to be a crash. But sellers are willing to negotiate right now. I don't know if you're seeing that in your own real estate investing, David. But like, yeah, a lot.

Yeah, a lot. People are a little bit fearful, right? the sellers want to like get in before they think things are going to go down. And again, that doesn't mean like every property is going to be great and every seller is going to be willing to negotiate. But it does mean that unlike the last two years where like sellers had this just iron grip on the housing market and they dictated terms. They dictated price. And it was just a complete sellers market. Now we are starting to see some balance get restored back.

And buyers have a little bit of power right now. Yeah, this, I mean, this is, I haven't bought this many houses since I was doing the Burr Strategy in northern Florida and I was buying four to five houses a month and I probably messed up talking about that on the podcast because then everybody else moved out to that area and it got really hard to buy them. But I've got 14 houses in escrow right now and they're probably averaging right around a million dollars each. So these are not cheap properties that I'm buying. And I've never seen the ability to negotiate like what we can do right now. It's actually fun to be investing in. real estate again and the interest rates aren't fun but when interest rates were low we were constantly complaining that you can't get a house and they're getting overbid and it's a bidding war and everyone's overpaying and so now we finally see an adjustment to that and the complaints are well interest rates are really high right it just goes to show there's always going to be something that pops in that makes you think I don't want to invest into real estate we're already at the top

of the market or the market's going to keep dropping like the reality is none of us know that's why we rely on the fundamentals we analyze a property to make sure it's going to cash Go ahead. No, I was just going to say, like, this idea that there's going to be a perfect time is wishful thinking, right? Like, is there ever going to be a time where interest rates are super low and prices are super low and rent is really high and there's no competition? There's no risk.

No. And there's no risk that's never going to happen. And people are like, oh, back in 2008, it was so easy. Everything was cheap. Well, interest rates in 2008, 2009 are about the same as what they were today, just for the record. And secondly, it was super hard to get a loan back then. Credit was super tight. So like, even though prices were low, credit was high. There's always something that you're going to have to overcome. And so I think this to me and to you represents an opportunity because no longer

are there just no houses to buy. Now there are actually things you can go look at and you can interact with people. And we, a lot of what the presentation I'm about to go into goes into is It's all about momentum, right? And it's like, no, it doesn't have to be the perfect deal. It's about getting a deal that, A, improves your financial position, not saying to go buy anything, but find something that is going to make a demonstrable difference in your financial position and use it as an opportunity to learn. So hopefully everyone listens to this.

I think there's some really good practical tips that can help you go take action right now. And as David and I were just kind of just alluded to, really, that's really what it comes down to. It's like getting ready and taking action and committing yourself to investing. And hopefully what we're going to talk about today gives you some practical tips on how to do that. Amen. That's some good stuff there. Now, for today's quick tip, if you like what you hear, if you decide, hey, this is the right time for me to get a little bit more serious about my investing, I want to take advantage of the soft points in this market and find a great deal. We have some help for you. If you go pro with bigger pockets, there's a lot of resources you can use that will help you analyze properties, help you find what the rents are going to be, discounts to use different vendors that you're going to need in your investing journey.

We have a discount code for you because you listen to this podcast and you took action. So you will get 20% off of a pro membership as well as some goodies. Dave, what is the discount code that they need to use? They can use discount code pro rental. That's P-R-O-R-E-N-T-A-L. I don't know why I just spelled that. I think people know how to spell pro-runtle, but if you don't already know how, there you go. Yeah, it doesn't hurt, right?

Never hurts. Right. So we hope you guys enjoy this episode. If you've been thinking about jumping into real estate, nobody knows for sure what's going to happen. Could the market drop more? Yes. Will the market continue to correct? If interest rates continue to go up, yeah, it very well could.

But will real estate become more expensive as interest rates go up? Yep, that's probably true too. And is it going to bounce back at some point in real estate? And is it going to go back at some point when interest rates? trades go down again. Yes, that's probably going to happen. Real estate is a fluctuating beast, and that is why we listen to podcasts like this. That is why we follow bigger pockets and we talk to other investors to find out what is happening in the market at the place in time when we're looking to buy. So it's our pleasure to bring you this information. We hope you like it. Let us know

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PropStream also gives you AI-powered insights and comms that are over 99% accurate. So you know you're making smart offers. Plus, you'll have access to PropStream Academy to guide you step by step. Start your seven-day free trial and get 50 free leads at Propstream.com slash BP. That's P-R-O-P-S-T-R-E-A-M. Don't just dream about real estate. Make it happen with PropStream. Hey, everyone. Welcome to this Bigger Pockets webinar. How to buy your first, second, or third rental property. My name is Dave Meyer. I will be your host today. And if you don't already know me, I'll get into this in a little bit. But I've been a real estate investor for over 12 years now. I work full time at Bigger Pockets and Data and Analytics. And I'm the host of VigurePockets' newest podcast called On the Market. And I'm super excited to talk to you all today because financial freedom has been a passion of mine for. years, and I have been fortunate enough to find it through rental property investing, and I'm super excited to help each and every one of you today find that financial freedom that we all

yearn for through the power of rental property investing. Now, if you are here today, it's probably because you want to take some positive action in your life, right? You want to make a change. And maybe that's because you want some more income, or perhaps you want to retire early, get out of your job, whatever it is. And maybe you've heard, hopefully you've heard by this point, that real estate is the best possible way to pursue financial freedom and to live the life that you want and that you deserve. And I believe all of that is true. I genuinely, genuinely believe that real estate is the best way to pursue financial freedom. I've lived it. I've seen tens of thousands of people do this. But not that many people actually get there. So let me ask you a

question. Why is it that so many people think about getting into real estate, but don't actually pull the trigger, start investing, get those first couple of deals, and wind up pursuing the financial freedom that they want so badly? Or maybe you have one deal. Why do so many people just have one or two deals and never scale up? Actually, that's a problem I had early in my career. I took way too long to scale up. So why does this happen? I like, to call it the three Ds, right? One, these are the, again, the three Ds, sorry, are three things, the most common things that I hear over and over again that prevent people from pursuing their financial goals, right? And they're simple, right? One is dollars. And I know a lot of people are

probably out there thinking, I don't have the money to invest in real estate. That is a common objection I hear from people. Two is deals. Everyone's saying that these days, right? All the deals are in the past, oh, there's nothing good to buy anymore. Everything is overpriced. We'll talk about that. I don't think so. So we'll talk about that. And then third direction, right? This is all about the purpose that you take. Like people don't know how to pursue the goals in a consistent, focused way. And so they, you know, they're maybe interested. They've read a little bit or they've watched a podcast or a webinar or something, but they don't know the system for pursuing financial freedom consistently day in and day out. And this direction one, I know it's like a little bit less obvious than

dollars and deals, but it is super important, maybe the most important because it's all about your mindset, right? And it's important to know that success in almost all cases is not a secret or an accident. It's not just something that happens to you. It's something that you have some control over. And it's all about your action and your mindset and your ability to consistently show up every day and follow a system that honestly I'm going to teach you today. I'm going to teach you how to do it. All you have to do is show up and take action. But it's hard. So you're going to have to commit yourself to doing that. I mean, I think a really good example of this and a good parallel to what it takes to be real estate investing is actually like trying to lose weight or

getting in shape. You know, everyone wants to lose weight. Everyone wants to be in great shape. But are you going to actually follow the system and process that everyone knows works, right? It's like diet and exercise. I actually, not a lot of people know this. I actually used to weigh like 40 or 50 pounds more than I do now. And I didn't know any secret. There's nothing I did differently than what anyone else did.

It's common knowledge. All I did was show up every day because I really, really wanted it. I wanted to be healthier. And so I pursued that every single day and I got there. And real estate is basically the same thing. thing, right? You just have to show up and follow the systems that hundreds of thousands of people have done before. And it's not a secret. We're going to teach you all about it today. That's what we're here for. That's what this webinar is about. We're going to talk about getting the dollars,

getting the deals, and finding that direction you need to be a successful real estate investor and get that financial freedom, right? I mean, I'm sure you're with me, right? Everyone wants this financial freedom. It's amazing. It's such an incredible, powerful force in your life. And I really want to help all of you get there. Now, actually, I made this webinar a while ago, and there's actually a fourth hurdle. I just couldn't think of a D word to come up with it. But that's basically the economy, right? We all know it's pretty wild right now.

It's very confusing. And luckily, this is my job. I talk about macroeconomics in the housing market pretty much all day. So I am going to address that later in the webinar as well, because it is confusing and a little bit scary, but it doesn't have to be if you actually understand what's going on. So I will, in addition to the three normal hurdles, I'll also put some economy stuff there. So before we get to that, let's just talk about why this webinar is even called the first three deals, right? Three is just some arbitrary number.

Why did I pick that? Well, it's because the goal of the first few deals is not to build wealth. Yes, it's like it's going to help your hopefully improve your financial position. But three deals, let's be honest, it's not going to get you to financial freedom unless you have three. grand slams, but it's probably going to take you more than three deals. So why are we focused here on three deals? Well, the first three deals are all about building momentum. That is what we are here for. This is about building your network, about building systems and processes that will take you really anywhere that you want to go with your investing career. It's all about building this

strong foundation and moving forward consistently. I said this earlier. I made a mistake earlier in my invest in career and I've reflected on it a lot. And that's why I talk about momentum so much is because I actually, I got my first deal like in 2010. And then I didn't do another deal for four years. I was doing work and all this other stuff. But I didn't really think about it. And I didn't build a system that enabled me to scale my business at the same time as having a career. And, you know, it was in my 20s. I was trying to have some fun. But I could have done that. And I should have done that. And if I had put the systems in place at that time, I would have had a much bigger portfolio. Now, I've caught up since.

But, you know, I really want you to focus on momentum because that is really the most important thing when you're first getting those first couple of deals. Okay. So that's what we're going to talk about today. It's about how to get to those first few deals. And from there, you can move on to your financial freedom goals because you'll have the systems and foundation that you need to really reach anything. It doesn't like change fundamentally after three deals.

I just think after you've gotten those first three deals, you're going to be so good at this that you can scale to pretty much any size that you want. So before, if you don't know Bigger Pockets, let's let me just take one second and explain why I'm here talking to you. Bigger Pockets is a massive community and resource for real estate investors. We have podcasts. We have webinars. We have blogs. We have all sorts of things. But underlying all of that, let me just tell you what we at Bigger Pockets believe.

We believe that real estate investing is the greatest wealth building strategy out there. We have helped hundreds of thousands of people. There are 2.5 million people who have used Bigger Pockets systems to pursue real estate wealth. But we also believe that this is not a get rich quick scheme. Listen, this is not going to make you wealthy overnight. This is, again, about a system and process that if you definitely, dedicate yourself for not that long, for a couple of years. You can find yourself anywhere you want to be. And third, we firmly believe that anyone can do this, whoever you are out there,

any credit, any income, any circumstances. Of course, people come from different backgrounds and have different challenges to overcome. But I am confident that no matter who you are, if you are listening to this, you can make this happen if you really want it. We can help you with these systems. that's what we're here for today. And again, I'm not just saying this. I know it's possible because I've seen it. I've worked at Bigger Pockets for seven years. I've seen so many people become successful through real estate investing. And that's what you're here to do today. All right. So let me just quickly explain who I am and why I am even qualified to lead this webinar. And my name's Dave Meyer. I've been working at Bigger Pockets for seven years. I've been investing for 12. First couple

years when I was investing, I had no idea what I was doing. I was just making it up as I went along. I never heard of bigger pockets. And then one day, I decided I wanted to take the two things I'm passionate about, which are data and analytics and real estate, look for a job, found one at bigger pockets. My life has changed dramatically since then. I've been able to scale my real estate portfolio. I am mostly a rental property investor. I now invest passively. I have one short-term rental. And I still love data analysis and do that as well. So my new podcast called On the Market does into macroeconomics, data analysis, and all basically all the trends and news and things that you need to know as an investor that's going on in the world right now. So check that out if you haven't already.

I wrote a book with Jay Scott. If you know, Jay, he is an incredible real estate investor. And he and I wrote a book together called Real Estate by the Numbers. It's coming out this October all about the math and how to really just be a great at deal analysis. And we'll talk about that today. but that book is coming out. And just as a reminder, I was once a newbie two. I really didn't know what I was doing.

But once I hit that like three deal mark, I really started to understand my systems, my process better. And that's why today we're talking about building that stack so that you can get to that financial freedom. I do live in Amsterdam. It was a lifelong dream of mine to live abroad. And luckily, through real estate,

through bigger pockets, I've been able to pursue that. And it's been an absolutely, wonderful experience. If after this, you want to reach out to me, you want to connect with me. The best place to do that is on Instagram. I am at the Data Deli. If you don't know already, I love sandwiches. That's why I love Data Deli. So I talk all about real estate, economics, and of course, sandwiches. So, okay, with that other way, now you understand who I am. Let's talk about our first few deals. Because in some ways, it really matters a lot about your first few deals.

And in other ways, they kind of just don't really matter at all, right? Because, again, we are talking about momentum here. So in the ways that they do matter, it matters just that you show up and actually do them. And I'm not saying that you should just go by anything. We're going to talk about how to find a good deal for your first deal today. But what matters is that you, you know, you jump in the ring. You get in the arena and you start learning because you don't learn by watching and you certainly can learn here in a webinar, but a podcast. But the way you really learn and understand

it at your core is by actually getting in there and doing that. So that's why the first deals matter. But why they don't really matter is because you don't need to hit a home run, right? As I said before, three deals, not going to get you to financial freedom. So don't put so much pressure on yourself, right? Like you don't need it to be a home run. You want to hit a double, maybe a triple, even a single is fine, like a house hack where you just reduce your monthly expenses. That is getting in the game you are going to learn so much. So that's what I want to talk to you about today is just getting started because once you do, the impact is going to cascade and is going to compound and is going to grow to whatever you want it to be. So let me share this

concept with you. And this is a super important concept for what we're talking about today and why the first few deals are so important. It's a system and a concept that we call the stack here at bigger pockets. And the concept here is something that you need to understand is that you don't build wealth by getting a single property or by any property. The way you build wealth is by building a portfolio, right? You need a lot of assets, not even that many, but you need a more than one asset to actually build that wealth that you're talking about. And listen, I know that sounds probably intimidating, right? Like, maybe you're sitting here thinking, I'm just getting started. I don't even have one. Like, how am I supposed to start thinking about a whole portfolio?

Well, it's the same to buy one as it is to buy two or to buy four or to buy five. It's about this system and we're going to talk about this system and we're calling it the stack. This is basically a blueprint for you to pursue for financial freedom. So just imagine, you know, you buy yourself. You commit yourself today to in the next six months, you're going to buy your first rental property. Let's call it a single family home. Most people start with single families. And a single family is a great deal.

It's a great way to get started. And no matter who you are and who you're by whatever it is, you can do this. Like a single family residence is entirely possible. If you want a house hack, you can put as little as 3.5% down or maybe you have enough to put 20 or 25% down. I promise you by the end of this webinar, you will know that you are capable of buying a single family home in the next three to six months as long as you dedicate yourself to that. So there you did it. Congratulations. That was the hardest part. One deal is the hardest thing you ever have to do. I admit it. I know it is scary to do that first deal. I mean, honestly,

I still get a little nervous between every deal I do. That's okay. But after that first time, everything just keeps getting easier and easier and easier. So wherever you are, whatever you're doing, please just focus on that first one. Then what if, you know, a couple years from now, then you buy a duplex. It's still only one unit, right? It's still only one purchase. So first year, you buy one single family residence. Second year, you buy a duplex.

Maybe in your third year, you buy a fourplex. All of a sudden you have seven units. All you do was buy three things, one per year. And now you have seven units. Imagine if you made a couple hundred bucks per unit off that. That's in three years. Then you go to eight, maybe then in 16. And all of a sudden, in five years, you have 31 units.

And listen, like don't get too much caught up in the details of making it exactly one, two, four, eight. This is just about exponential growth, right? It said if you learn how to do a single family, then you can easily buy a dupe. You can easily buy a four points. By the time you have seven units, you can buy an eight unit. You're going to have these systems in place that allow you to scale to any size. The way you start is with one. So stop worrying about your third deal.

You know, I'm just showing you this to show where we're going. But you don't need to worry about your third deal or your fifth deal right now. This is about momentum. And momentum starts with your next deal. That is the thing that matters most. And that's what we're going to talk about right now. Right. So what is stopping you from getting to this first deal or your next deal?

maybe you have a deal already and you're like me and you bought one and now you're just slowing down. I don't know. But I imagine these are roadblocks that most people face because I've heard it so many times. And again, we talked about them. They're dollars, deals and direction. But I'm first going to just talk about market conditions because I said I would. And listen, home prices are at an all time high. Rents also at an all time high, which is good if you already own some properties. And rising interest rates have been, you know, interest rates. It's been going up for a while now, and it is slowing down the housing market, right? So that seems a little scary. On the other side, there are other things going on, right? Like stock market and cryptocurrency have been getting hammered over the last couple of months.

And there are valid fears of a recession. I do think there's a good chance that there is a recession in 2022 or in 2023. So that begs the question you're sitting on this webinar and I'm telling you all these scary things, is now a good time to buy. overwhelmingly, I can say yes. I've already done several deals this year. And literally every experienced investor I know is continuing to buy right now. But let's talk about why, because I'm not just saying this because I'm boosting something. I genuinely believe this.

Number one, it is always a good time to invest if your numbers were. If you know how to analyze a deal, it doesn't matter what the market conditions are. If you can find an 8% cash on cash return, I will buy it in. any single market. Or if you know how to find a good deal and negotiate a good price, that works in any single market. Transitionary markets, which is what we're in right now, we saw this huge run-up in prices. That's over, I think. But we're still likely going to see probably appreciation over the next couple of years. And even if you don't, Transitionary Markets offers opportunity to buy below market value.

If you listen to my podcast, you know, James Dainert and Kathy and Jamil and Henry are always talking about this because basically sellers now in this type of economy are willing to sell. They're willing to negotiate. They're willing to talk to you. That didn't happen the last couple of years. There was crazy competition. Even as an investor, you had to bid aggressively.

You had to waive contingencies. That is changing. You're going to have much more leverage as a buyer. that means there's opportunity. Third, this is true of any investment, but it's true in real estate. Time in the market is more important than timing the market. And they say this in the stocks because it's true. The longer you own assets, the better off you're going to be. Listen, I look at macroeconomics literally every single day for hours and I don't try to time the market. And I know people probably think that's not true, but it's 100% true. I don't

try to time the market. Instead, I try to buy good deals consistently when I have the cash available to do that. And that's because I know what a good deal is. I know how to analyze good deals. And you will too by the end of this webinar. But as I said, every experience I investor I know is buying right now. And that's because they have systems, right? They know what a good deal is. They're getting good leads. They are seeing full, you know, really good opportunities. And they're pouncing on that. I'll just leave you with some words that Warren Buffett, I'm not leaving you. I'll end this section with some words from Warren Buffett where he said, be greedy when others are fearful and fearful when others are greedy. And I really take that to heart. That means there are

opportunities when everyone else is afraid. And I'm not saying buy anything. Absolutely do not buy just anything. Buy a good deal. You're going to teach you what a good deal is and only buy that. Okay, so let's get into the traditional 3Ds. Number one is dollars. All right, real estate finance, honestly, is really all about mindset. You can find financing if you really want to. First way to do that is the traditional loan. So this is when you put 20 or 25% down if you are, you know, and get a traditional mortgage. This is the easy thing to do. If you have a W-2 job or if you are a contractor and you have two years of pay history, you can probably get a traditional loan. Or if you want to owner occupy, do a house hack, that's a great way to get started as well.

And you can put as little as 3.5% down. So you can do this a lot, right? You can get five or even 10 mortgages just by using traditional mortgages, right? We talked about the stack. You could get to seven units or you can even buy more than that just by using traditional loan. So this isn't super complicated, but there are probably people out there who don't have 20 or 25% to put down. So there are other options out there. And the number one option I recommend if you don't have dollars is to do a partnership. Honestly, so many people overlook the value of partnerships. They look at their own financial situation and think, I don't have the money to do that. Well, someone you know might. And if you don't, maybe you just put sweat equity into a deal.

There are so many different ways that you can structure a partnership that wherever your financial situation is, you can figure this out. And I know people are maybe skeptical. So let me just tell you the story of my first deal. So let me tell you about the story of my first deal. When I was 23 years old, I was a year out of college, I was waiting tables and I had no money at all. Really, no money to my name. But what I knew was that real estate prices had just gone down a lot. And, you know, I had done some, data analysis in college and I was able to figure out that this would cash flow, right? I knew it would cash flow. I didn't really honestly know how much it would cash flow.

I didn't really know how to analyze a deal. But luckily, I figured it out. I went to some people I knew and was able to convince them three other people to go in on it with me. And the deal we had, we needed just over 100 grand to put down on this, on this apartment, four units. And we each needed to bring 26K, but I didn't have it. So I went to one of the other partners and said, listen, if you put in my 26K, in addition to all the benefits you're getting for being an owner of the property already, I will also pay you 6% interest on the 26K you loan me.

So now this partner has a lot of equity and they're getting cash flow basically from me paying them 6% every year on that 26K. So I did all the property management and the partnership basically paid me for my property management, what you would pay normal property management. And then I use that cash to pay off the secondary loan. So this is what I mean about getting creative, right? No one told me to do this, but I figured it out with some people I knew. I managed to be the property manager to generate cash. And at first, did this make me a ton of money? No.

But over the years, I actually bought out two of my partners. I was able to figure out how to generate more cash flow. And it wound up being an excellent, excellent deal for me. But at the time, it was a single. You know, it wasn't a home run. But it did help me learn the business. And again, I didn't follow this up as fast as I should. But in retrospect, over the years when I was managing this property, I learned a ton.

And I am so glad that I got into this, even though it wasn't the financial home run, that it might have been had I just bought it on my own. But it got me into the game. So let me just get back to that. Partnerships, an amazing way for you to find the dollar. So far, we have a traditional loan. We have a partnership. And then the last thing I want to say, this isn't like really its own way of financing.

It's a little bit different. But the Burr strategy is an amazing way to build a portfolio, right? So portfolio, you know, when you do a burr, it's basically like flipping a house, but you actually keep it, which is kind of the opposite of flipping a house. but you buy a house that needs work, you renovate it. But then instead of flipping it to someone else, you do a cash refinance. And you can take out a lot of the money that you put down and take it out of that property and put it into the next property.

I'm not going to get too far into that. David Green wrote a great book about Burr. We actually have a couple of resources I'm going to talk about here in a second where you can learn more about this. But it is a great way to build a whole portfolio when you don't have a lot of of cash. So if you want to learn more about that after this, check that out. And we have an awesome giveaway for you. If you're a pro member, we have a full workshop that David Green and Brandon Turner put together for nine strategies to invest when you have no money. I mean,

Brandon wrote the book, How to Invest with Lower No Money Down. So he is the ultimate resource for this. And if you are a pro member, which we'll talk about later if you're not, if you want to go pro, we'll talk about that in a little bit, but you'll get nine strategies on how to do this. And believe me, I did it. I had no money when I got started investing in real estate. And you can absolutely do it too. Dollars are not a hurdle that you should really be considering. And I'll explain that more in just a little bit here.

So the secret here, well, not that little bit. I'll explain it right now. The secret to financing real estate, I said it was a mindset. And I want to convince you that not to get so hung up on dollars, because no matter what, the secret to financing real estate is having a great deal. The whole reason I was able to convince those partners to go in on me, even though I had no experience, was because I had an amazing deal and I was able to analyze the numbers and show them how much money they were going to make, even with a lot of contingencies.

And that is true for you. If you have good deals, people will invest in it. No investor turns down an excellent deal. it's just not going to happen. So that is really what it's all about. So it's helpful to know what financing strategies are out there. But if you can learn to identify excellent deals, that is going to help you with financing a million times over.

But let's just talk a few ways to get deals right now. The MLS, I know it's not sexy. It's not the cool way to do it. But so many people find deals on the MLS. Honestly, I've found the majority of my deals on the MLS. And according to a lot of friends of mine who are super active real estate investors, they are getting more deals on the MLS right now than off market right now because sellers, again, it's a transitionary market.

Sellers are motivated right now and they're willing to cash in. They are willing to negotiate and there are great ways to find these deals. One of them is, of course, a real estate agent. So if you don't have one, you want to find an investor friendly agent. You can do that for free on bigger pockets, It's biggerpockets.com slash agent. You can find an agent who can help you find really good deals. Now, you can do this.

You can go on Zillow, but not every deal on Zillow is going to be great. So don't get discouraged. We're going to talk about this in a little bit, how to whittle down. Like if you go on Zillow, how to funnel it down to find a great deal. We'll talk about this in a minute. But just for now know that the MLS, don't listen when people say the MLS doesn't have good deals. There are good deals on the MLS. You just have to be patient and figure out how to find them.

The next one is driving for deals. This is also called driving for dollars. It is extremely common because it works. But it takes a little bit of work, right? You're going to have to do a bit of legwork here to actually find these deals. Now, you've never heard of driving for deals. This is basically a process of identifying properties that have a likely seller, but they haven't put it on the market, right?

So they have, maybe it's someone who had an unfortunate situation with their family and they need to get out of the house or they're, you know, you hear a lot about hoarders who want to move, but they don't have the energy or the money to clean up their house to put it on the market. So a lot of people just don't wind up putting it on the market. But if someone comes along and says, hey, I'm an investor. I would love to buy this deal from you, then that's a great opportunity for both parties. And I love this. I love the way that James Dainert says this or Henry Washington, people who are on my pocket. podcast say it. So you're not buying a deal when you're driving for deals. You're buying a situation,

right? Some people might just need cash now and they don't, they're afraid to put on the market. They don't want people coming into their house. The house needs a lot of work. Maybe it needs a new foundation and they're not prepared to do that. These are all situations. And going back to the idea of market conditions, situations happen in any kind of economic climate. These types of deals never go away. Yes, you're going to have to do some work, but there are great tools out there, deal hub deal machine sorry is a good one i've no affiliation but i've used it before it's a really good tool um and this is a very good way to find deals right if you want to find things under value if you're willing to do value add and you know do some construction and rehab work driving for deals works all

day there's a ton of resources again we're going to share with you guys that you can learn more about this for free but don't forget about driving for deals it is an excellent way to find deals. There's other ways to do it. You know, we call it driving for dollars, but you can do direct mail letters, direct cold calls. So this is similar to driving for deals, but rather than actually like driving around and finding house and be like, oh, that one, yeah, it's a little run down. Like maybe I'll call those people. You can actually just send them mail or you can call call them by buying lists. So there's all sorts of services that do this. You can basically go on people who are in pre-foreclosure or maybe people who live out of state,

right? It's not owner occupied and you know that they're a landlord renting it out and maybe the place is a little run down and need some work. Maybe you can take it off their hands. And guys, this is a numbers game. Not everyone's going to respond to you. You might send out a thousand mailers. You might cold call a thousand people and you might get a couple responses. But all it takes is one deal and it's entirely worth it, right? It's about getting that momentum. So you just need one deal. Maybe you get one deal a year doing this. It would be still worth while. And there are all sorts of companies that can help you do this. So you don't have to do it alone.

You don't have to figure out how to do this. There are resources to help real estate investors do this exact thing because it works. The last is relationships. I mean, real estate is such a, it's just a relationship game. I get called. I get talked to by people all the time because I'm friends with a lot of real estate investors. So make friends with a lot of real estate investors. Make friends with real estate agents or property managers or lenders because they hear about

deals all the time and they can pass them along to you. And this isn't a quick thing. Like this does take some time, but it's something to think about if you're, you know, maybe it won't work for you in the next three months. But if you're trying to build that stack, if you're trying to get a couple deals in the next few years, start building those relationships now because they'll start bearing fruit a couple of years from now. So that's deals.

We also, remember if we have pros, so you can get a master class hosted by Brandon Turner on how to find great deals. We're going to talk about, it talks all about relationships. Like I said, driving for dollars, the MLS. Brandon talks about going on Facebook using Craigslist, all these really creative strategies to find deals. And like I said, if you can find deals, you will find the financing. So make sure you know how to find a good deal and to how to analyze a good deal, which we'll

talk about in just a minute. The last thing here is direction, right? We talked about this earlier. And this is about following the purpose and being really focused on where you, where you spend your time and your attention. I actually listened to something the other day with Warren Buffett and Bill Gates were both independently asked to write down in one word why they were successful. And they both, they didn't know they were talking to each other.

They both wrote down the same word. And it was focus. It's not direction. Didn't have a D. But it's the same kind of idea, right? It's all about pointing yourself with intention where you want to go. So how do you find direction? Well, first, you've already taken the first step.

You are educating yourself, which is the most important thing, right? You want to start really broad at the education phase. So you're doing it by being on this webinar. You need podcasts. You need books. We have forums, blog posts on bigger pockets. You get most of this stuff for free. So you need education.

And this doesn't stop even when you have a first deal or second deal. I'm still learning. I am still constantly talking to him. investors, watching webinars, reading the forums to learn more and more and more. And you want to do that as broad as possible. Next is focus. Like I said, it's a sort of subset of direction, but you need to be able to focus to support your long-term goal. So it's so easy to get that shiny object syndrome, right? Like maybe you're looking for a short-term rental, but then someone tells you about wholesaling. You're like, oh, I got to, I want a wholesale. Or like, I'm going to flip or I'm going to

do note investing or whatever it is. There's so many things. But it's specifically, at the beginning, you have to focus. Otherwise, you're going to get overwhelmed. So you need to pick an area, like pick a market. Pick where you live. You know, pick somewhere close by and be specific. Pick the actual block or the zip code or the neighborhood that you want to buy in, because that's going to help you focus your brain on what exactly you need to do instead of being distracted by all the things that are else that are going on around you. Pick your property type, right? Do you want single family? You want a short term rental. You know, we're talking at rentals today because I think it's the best way to build long-term wealth. I started doing

short-term and large multifamily later in my career. So if you're talking about first, second or third, I do think buy and hold house hacking. Great way to do it. But just pick one. Pick a condition. Do you want to buy A class properties? Do you want to do value add? There's so much resources about this and we'll talk about this more. But that focus is so important because it gets you to your buy box. And I'm going to talk about that in a little bit. But your buybox is basically what are you looking for in a deal, right? If you know I'm looking for a short, you know, a traditional rental in Denver, Colorado that has at least an 8% cash on cash return in a good neighborhood, then when you see that you are ready to buy, you're not going to be worried. You're not going to have analysis paralysis.

You're not going to be worried about macroeconomic conditions. You're like, this is what I've been looking for, right? And I'm ready to buy it because I know exactly what I want. And so this focus helps you create that by box. We'll talk about that more in just a little bit. And then lastly, this is about process, right? Guys, we've been talking about this, but process is what you need to get the results, right?

So even if you're focused, even if you know what you're doing, if you don't show up every day and do the work, you're not going to get anywhere, right? We talked about losing weight going to the gym, right? If you don't show up to the gym, you're still not going to lose weight, even if you think about it all the time and you've educated about yourself. You actually have to show up and do the work. And that is what we are hopefully helping you do today.

And this process, you might be thinking like, what is the process? What do I do? What do I show up? How do I do this? Well, that's what we're going to teach you right today. It's all about the deal funnel, okay? Deal funnel. We have an analogy called for it at bigger pockets.

We call it laps. And that's the process I want you guys to focus on here to get over that direction fear. So the deal funnel is all about a number. game, right? We talked about the buy box. So how do you find a deal that's in your buy box? Well, you need to start with a lot of leads, right? There's a reason this slide, it looks like a funnel.

It's because at the top of the funnel, you need to start with a lot of leads, right? It might be hundreds of leads. It's probably not thousands. But let's just say it's 100. I don't know. I'm just going to make up a number. Then if you're looking at 100 leads on Zillow, right? Like, not everything's going to be great, but maybe 10 of them are,

kind of interesting. You're like, oh, maybe this could work. That's when you analyze the deal. You actually underwrite it. You figure out what the cash flow is going to be, what the appreciation might be, what your important return metrics are going to be, and decide if any of them are worth pursuing. And maybe only 10%, maybe one of them is actually worth pursuing and succeeding.

But that's the game, right? I keep saying that all you need to do is follow up process that thousands of people have done. This is the process, right? All you do do, get a lot of leads, analyze the ones that look good, and pursue the ones that look good from there. That's all it takes. And even if those numbers, I just made them up, right? I said, out of a hundred leads, you get one good deal.

That's totally worth it, right? I was showing you before that to get a stack, all you need to do is really buy one, maybe two deals a year for a couple of years and you'll get to that financial freedom. Well, this is, would you not analyze 10 deals, analyze 20 or 30 deals to get that one deal a year? I know I would because analyzing deals is not really that hard. I'm going to show you how to do it in like five minutes. I'll show you in five minutes how to actually analyze a deal in five minutes. So that's what I want to make sure you understand here is that the deal,

real estate is just a numbers game, right? Follow this process, leads, analysis, pursue, success. Just do it over and over again. If you do the leads and you are able to analyze deals and you find deals that are good, You're going to find that financing, like I told you. You were going to know exactly what you need to be doing. So memorize this guys. Memorize the deal funnel.

It is not complicated. It is proven. And I know each and every one of you can do this because I've seen so many people do it. But just remember, it is a numbers game. Do not get discouraged if you look at 10 deals and none of them work. Good. You should be looking at hundreds of deals to know that you are getting the best possible deal. There are two kinds of real estate investors.

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then send postcards, emails, or call sellers directly. Don't worry if you're new. PropStream also gives you AI-powered insights and coms that are over 99% accurate. So you know you're making smart offers. Plus, you'll have access to PropStream Academy to guide you step by step. Start your seven-day free trial and get 50 free leads at Propstream.com slash BP. That's P-R-O-P-S-T-R-E-A-M dot com slash BP. Don't just dream about real estate. Make it happen with PropStream. So we've talked a little bit about how to find those leads, you know, driving for dollars, MLS relationships. You can watch that master class I just told you about. So let's talk about the next one. You know, because so many of those deals, so many of the leads that you're going to get

are not good deals, you need to be able to find the right ones. This is really important. And this is where it takes a little bit of skill. And I'm going to talk to you right about how to do it. You have to be able to analyze those leads to pick out the best ones. That's why people are going to invest with you. That's why partners are going to partner with you. And that's where you're going to find financial freedom is because out of all the properties in the United States, there are 140 million of them. Out of all of those, you're going to be able to find the ones that best support your strategy and best help you reach your financial goals. Here's what experts know. Again, I'll say this again. I said it earlier, but it's not about timing the market.

It is about time in the market. And you need to focus on what your portfolio looks like 10 years from now. So those are the important things to keep in mind when we are analyzing deals in just a second because, you know, it is easy to get distracted by the market. And I know it is confusing time. But if you have your buy box and if you follow this process of deal analysis, I'm about to show you, and you keep in mind where you want to be 10 years from now, I promise you, I promise you this is going to work. Okay. So we're going to try this in real time together.

We're going to actually analyze a deal together. And to help me with this, I am going to do. use the bigger pockets calculators? This is just so you guys know, this is a pro benefit, but if you're not a pro yet, you can actually use this five times for free. So go check it out because it's a really useful tool. I picked this deal because it's in Alabama. I actually just did a deal in Alabama recently in Birmingham, not in Huntsville, but I'm interested in the market. And so I like this deal. It's a three-bed, one full bath, two-half bath, 1,700 square feet, two-car garage, looks great.

It's a nice curb appeal. I like the look of the house. So I don't really know that much about it, but we are going to analyze it. So this, I just found this on bigger pockets. I just went to find deals, real estate listings. You can go check it out there. That's another good place to find deals. I didn't even mention bigger pockets tools of the fighting deals part, but that's another

good place to find deals. And to do this, we're going to go analyze a deal. And while I'm pulling this up, I'll just show you. I just go here to tools to rental property. Again, this is for Pro members, but you can start for free. Just hit start a new report. I'll just tell you guys, the reason I'm doing it on the bigger pockets calculator is because it's easy. And let's just start doing this.

I'm going to show you how to do it. And you'll see that in about five minutes, you'll be able to analyze a deal once you get good at this. But I'll explain this all to you. So first, let's just start by copying and pacing our address. That sounds pretty easy. This was in, look, you can just auto fill it. Great. I'm going to add a photo. I actually before this just did this so I didn't have to awkwardly do it while I was doing the webinar. But what do we got here? All right. There we got our image. You can add as many images as you want,

especially if you're going to show this to a lender or partner at one point, which I'll show you later how to do. You might want to add some good pictures. For the purposes of this, I'm just going to do one. And then what was our zip code here? 35, 8, 10. Let's put that in. Great. So now all we need to do is hit. next. Let's talk about our purchase. So let's just assume for now we're going to buy it at full price. And we might not be able to do that. It might not be a good deal. But for now, let's just start that way because you're going to learn and you're going to see that using the calculators, you can like sort of iterate on the deal. And if it's not a good deal at first, you can put in different purchase prices and see what you should be offering to make that deal. So let's just assume

that we're at 140,000 easy closing cost. What a closing cost, right? This is starting to get hard. Everything easier before Dave was just copying and pasting everything. Now we have to think, right? Purchase closing costs. Well, bigger pockets on the calculators have these little tips. So if you don't already know what your closing costs are, first you can do that by talking to a lender if you want to. But you'll see that's just one to two percent of the purchase price of the property, if unsure, one and a half percent. So I'm just going to do one and a half percent. What is that? That's two, 2100 bucks. And then let's just say we're going to rehab it, right? It did look like it needed a little work. So let's just say we're going to be.

rehab it. And after, listen, guys, I'm going to make up some numbers here. I'm not going to do a full analysis, but I want to show you that how easy this is. And I'm pretty good at estimating this after many years of doing this. So let's just say that we're going to put in 25 grand. And we think that will make 40 grand in value. Right. So instead of the purchase price, it was worth 140. Now it's worth 180. That's amazing. And for that, it costs us 25 grand. Again, I don't know exactly. exactly what it's going to be. Obviously, I've never been to this property. I don't know, but I'm just going to make some ballpark estimates because I want to show you how easy this is. Again, we don't want you to get stuck. And we really want you, what I want for you is to be able to get good at these deal analysis so you can do the laps, right?

You're going to have all these leads and you need to be able to analyze these deals accurately and quickly so that you can identify the ones that are good. So if you get stuck, don't be too worried. There's resources here. How do I get? at ARV, we've got tons of resources for you, built in right there for free. That's it, right? Now we know what our purchase price are. Moving on. Loan details. I'm going to say we're putting 25% down. For me, as an investor, normally that's what I put down is about 25%. Sometimes you can get 20% or if you're house hacking, you can put as little as three and a half percent down. And interest rates, they're high right now. They're actually, let's just say they're about 5.7%. Points charged, none. So I'm assuming that since I'm putting 25% down, my lenders aren't going to charge points.

What are points? You can learn right there. Loan term, 30 years. I love me a 30-year fixed-rate mortgage. One of the most amazing things about the American housing market is that there are 30-year fixed-rate mortgages that does not exist in many countries around the world. It's incredible that you can lock in your interest rate for that long. So I'm going to do that.

And if interest rates go down in the future, I'll just refinance. That would be great. So again, show you what we've done so far. We're flying through this because it's easy. And I'm doing this because I know it well. But I just want you to show you like once you get good at this, that you could be doing this quickly. So that when I talk about this funnel where you have 100 leads, you can run these 10 analysis in an hour, maybe an hour and a half, even when you're really thinking about it. So we've gone through all these.

Now it's time to get to rental income. How do you find rental income? How do you figure it out? Well, there's a couple of ways. One, talking to property managers. You know, that's a great way to do it in your market. Or perhaps, perhaps you actually rent right now in a market that you're going to invest in and you have a good idea of what rent is going to be.

But if you don't, I'm actually going to pop over to this other tool that we have here on Bigger Pockets. It's called the Rent Estimator that will do exactly what we needed to do. So what was our address here? I'm going to just copy and paste this. And guys, this is a tool that I built, and it is, honestly, it's pretty darn accurate. And you know, you still might want to double check, you know, like with a property manager or someone in the area. Maybe you know another investor in the area is a great way to also check rent. But if you want to analyze a lot of deals, this is an excellent way for you get information quickly, right?

Because we want to get our rent up quickly. So what we see here is median rent about 12, 15 a month. I'm liking that. And our confidence, the thing I love about this tool is that it tells you how confident it is. Like sometimes you'll say it's low and you're like, all right, I got to call a property manager. But now it's saying confidence is high because there's a lot of comps in the area.

Like look how many different properties are around here. This was a three bed, one full bath and two half bath. So I think a one and a half bad three bath comp is pretty good. And so it's saying 1215 and I think that sounds pretty good just based up what I'm doing. So rent, we're going to scroll back down here and put 1215 in there. Whoops. Now we're going to put 1215 in there. And we're moving on.

We're almost done, guys. We've already done loan assumptions. We've talked about price. We've talked about rent. Hopefully, you can see this is pretty easy. Property taxes. So what are our property taxes going to be? Let's see.

Let's go back to the listing. Maybe that's what pretty taxes are going to be. It doesn't. but usually it's about half a percent. So I'm actually just going to estimate, let's just say it's $1,000. I don't know. That sounds good. Insurance, I'm also going to do about $1,200.

That's about average. Actually, in Alabama, I know it's in like Hurricane All right. Let's jack it up. Let's just say $1,500. I don't really know for these two, property taxes, that's public record. So if you're going through the calculator and you want to see property taxes, just go to public record. You can do that very easily. and insurance, you can just Google that as well.

Those are both really easy. Now, repairs, vacancy, and CAPEX, this is going to depend heavily on every property. But what I like to do is 5%, 5%, 5%, 5, 5, and are you going to manage it yourself? If so, you can put 8%, that's about 10%. You can even say 10%. But we'll adjust this all in a minute.

I like repairs and CAPEX at about 10% combined. And the only difference between these, by the way, repairs and maintenance are like repairing something that's broken. Capital expenditures is like something that's really big, like a roof or maybe renovating. It's just treated differently in the tax code. But for all intents and purposes, it's maintaining, repairing, improving your property. You always want to have some vacancy in there. And again, you can learn how to more accurately represent these. I just want to show you how easy to run the numbers are, but you're going to want to work with those inputs. Next, honestly, I personally love to just bill back, just let the tenants

pay their own utilities. Like, it works better for everyone. They just pay what they owe and I don't have to worry about it. So I put those in. I'm not a big HOA guy. I don't like HOA ads. So I stay away from those. And so I'm going to put zero in all these and we're done, right? I know I didn't quickly, but I want to show you how quickly it could go. I'm doing this intentionally because honestly, I can run deals this quick. I can do it in four or five minutes. It's not because I'm some master of this. It's just the calculator super easy. And once you get enough reps in, right?

Once you analyze deals, I've analyzed thousands of deals in my life. And that's why I can do it so quickly. But if you do 100, I promise you, if you sit down today and decide, you know, we talked about showing up every day. If you show up and analyze five deals a day for the next month, you are going to be a master at analyzing deals. You're going to know your buy box because I'm going to show you how easy it is to do. But commit yourself to that, right?

That's what it's about. It's about showing up every day. And this is an easy way to show up every day. All right. Let's see what we got. All right. So $93 a month. So it's positive cash flow.

12% annualized return pretty good. Cash and cash return 2%. Not great. That's not where I'd really want it to be. That's okay. You're going to analyze 100 deals and you might only find one. But if I know my buy box, that's why I know that this deal isn't right for me. Right?

Personally, I actually usually take a lower cash on cash return. return than a lot of investors would if there's good value out opportunity, good appreciation opportunity, I usually like four or five percent minimum, but still this deal would be a little too thin for me. But something that experienced real estate investors know that you, that a lot of people don't understand is that deals aren't just found. Deals are often made. And I know that sounds confusing, but it's true. Like I just put in random numbers here, right? So like what if instead of 140 grant. Remember, I said sellers are willing to negotiate right now. All I need to do is let's what if, yeah, I don't know, maybe they'd take 130. All right. Now it went up to 216.

Remember, when I put in my rent income, that was the median, right? That just means it's the middle. So there are some higher than that. There are some lower than that. I also said that I was willing to put in 25K to upgrade that property. Maybe that turns it into $1,400 a month. All of a sudden, now it's 5.3% cash on cash return and I'm looking good, right? Now it's a good deal. Will I be able to buy it at 1.30 and to raise the rents to $14,000? I don't know. I'm just trying to show you that deals like this is the time to get creative and this is the

time to go make a deal for yourself. This is the great opportunity in this type of market because people are willing to negotiate. Rent is really high. Sellers are getting scared and they want to sell. while it's still perceived at the top. And so you can maybe find these deals. Will this deal work? I don't know.

I'm just trying to show you how to run these deals. Honestly, if I could find a deal like this, this wouldn't be bad for me. An 18% annualized return, sign me up. Sounds pretty good. All right. So that's just something you need to know. Obviously, I also just made up those expenses.

So, oh, one other thing I should show you. If you're new, a great way to make something cash flow, drop these management fees down. Manage your property yourself. I did that myself. You're not going to want to do it forever. I think after three properties, you got to stop. You can manage maybe five units yourself.

But at first, if you just want to get in the game and start building that momentum, just drop that down to Zier. Look, you're at an 8.5%. You do some sweat equity yourself. A few other things about the calculator should note. If you scroll down, you can see all these important metrics that every investor wants to know, which is like NOI, cash on cash return, expenses, everything in here is great. and something I really like to look at because I'm not a pure cash flow guy.

I really like just looking at my total annualized return, as you can see how much money you'd be making over time. Over five years on this deal, as I've had it configured right now, 20% per year basically for five years. You know what the stock market averages? Eight or nine percent. So you're almost doubling that on this deal that I randomly just threw together. Let's just put this back at 140,

management fees at 8%. Let's just go back to like 12, 15. Still, 11.6%, still better than the stock market. So just think about that when you're thinking about timing the market. So what I love about this calculator is that it just makes it so easy for you to analyze the deal, right? It took me like five minutes to do it in the first place. And then I can make my deal, right? I don't know if the seller will accept that.

But I have the tool now to be able to do. what I am willing to offer. Now I know that I am willing to offer 120, right? That is such an empowering tool because now you can find things and you can build your buy box around this entire calculator. One other thing I like here is that this sharing setting, so you can actually enable report settings and then you can download your PDF. And I think this is super important, especially if you're going to be doing partnerships, right? Because if you approach me as a partner and you send me an Excel file, I don't really want to learn all the way you made your Excel file. But if you hand me a Bigger Pockets calculator report where I know the math is right and I know

that this is done correctly, I am much more willing to partner with you to take you seriously because you know what you're doing. Like you've proven to me that you know what you're doing. You can use this for your spouse. A lot of times you've got to get your spouse on board. You can bring this to a lender, to a partner. It is such a valuable tool to be able to show how to do it. So that's why I love the bigger pockets calculators. I literally use it for all of my deals. I really recommend you do it. Again, you can do five free deals on bigger pockets.

So go check that out. You can do a spreadsheet too. You definitely can. I've done that in the past. But over time, I've learned that just using a tool that is built specifically to do this is kind of easier. Okay. So let's start to wrap things up with three simple questions here, guys.

Are you committed to buying your first, second or third deal? deal in the next 12 months. Are you? I mean, be honest. If not, that's okay. That's fine. I just want you to think about this. Because if you are sitting there thinking, I don't know, maybe, maybe not, that's okay.

But if you're sitting there enthusiastically saying, yes, like, I want this. This is for me. I can feel the financial freedom. I know the process I need to follow. And I can get started right there. Because if you want it bad enough, you're going to get it. I promise you. This is not rocket science.

So many people can do this. So if you want it, you can have it. Second, are you prepared to follow a process towards success? Right. We've talked about this weight loss analogy or getting fit analogy in the past. Are you prepared to follow the process? Are you going to show up every day? Because that's all it takes.

Do you want it? Are you willing to show up? And three, are you willing to execute your plan every single day so that you can reach your full potential? Are you willing to be consistent? Because this is a numbers game. And if you are consistent and you follow that plan, I assure you that financial freedom that we are all striving for is possible for every single one of you.

I'll leave you with this quote by Jim Rome. He's a great speaker. He said, life doesn't get better by chance. It gets better by change. So decide. Like, are you ready to make that change? If not, that's okay. But maybe you are ready to make that change.

That little change. It's not some big dramatic thing. It's about showing up and following a proven. process. So if you are ready to start that good for you, I am excited for you. I'm so happy for you. I really hope this webinar has helped you get there because this, this moment right now could be the start of the momentum that we talked about at the beginning of this webinar. So I hope it has been for you. If you are ready to make that change and if you want that financial freedom, then let's talk about one of the best ways that you can do that. It's not. It's not. It's not,

Not for everyone, but it is one of the easiest ways, and it's one of the logical next steps for you if you are ready to take action. And that is a Bigger Pockets Pro account. Listen, it is not necessary. You can succeed in real estate without it, but we have designed it for real estate investors to succeed and it makes everything a whole lot easier. So if you want to know what Bigger Pockets Pro is all about, it is about finding financial freedom faster.

If you could shave off three or five years so that you can get to that financial freedom sooner, how valuable is that? That is worth anything. So you can do whatever it is that you are passionate about. Like for me, that's about travel, right? That is about my time with my family. I actually move to Europe. I live in Europe. I love traveling.

It is something I'm super passionate about. And now I get to do the things that I want to do every single day, not because I'm retired. I still work. but it's because I've been able to engineer the life that I want for myself because I was able to get that financial freedom at a relatively young age. And maybe that's not it for you. Maybe it's not travel. Maybe it's about spending more time with your kids or being around when they show up. Or maybe it's about starting a business or giving more to charity, whatever it is.

Like, what are you waiting for? Don't you want it faster? And that's honestly what we've tried to bill here at bigger pockets. So what does it do? First and foremost, it gives you unlimited access to those calculators. I don't know how many times it has saved me from a terrible deal and help me identify a great deal. You can go try it again for free, by the way, and you should. And so nothing is more valuable than that calculator, honestly.

Being able to analyze deals is the key to running that system. Again, if you want to do it in an Excel spreadsheet, you can. But this is a really easy way for you to do it. Next, you can get the rent estimator I just showed you. So if you want to analyze deals and know what something costs in rent, you need a good data source. And we have that data source for you with the rent estimator tool, super valuable. And this is honestly one of the most important things is showing the community that you mean business.

Like being a pro member, honestly, unlocks a lot of networking opportunities for you. It shows people that you're serious, that you have skin in the game. Remember the first question I asked you today is why so many people get interested and don't, but only a few actually take action and get started. Well, this is a way to show that you have. taking action and yet you're analyzing deals and that you are trying and that you are putting your time and your money on the line to pursue what you want. So another great thing that we have at pro. Something that's super exciting is boot camps. So this is a accountability program where for

12 weeks you'll be working with cohorts and expert real estate investors to learn and get to your first deal. Like we have a rookie boot camp that will get you to your first deal. You can get that for $199 and only pro members can get that. So that is extremely valuable. You can learn from the best. We have incredible webinars, archives of hundreds of webinars you can watch completely for free. We have landlord forms.

I use these for all of my properties. These are worth hundreds of dollars all by themselves. On any single state, they're rewritten every single year. We have lawyers look at them. They are excellent. So you should definitely check those out. We have partnership deals with MashVisor, AirDNA, A foreclosure, some of the best data providers, some of the best marketing companies in the

business, all give discounts to Bigger Pockets Pro members. But really, guys, I just listed a bunch of features, all of them, super important, super helpful. But really, the reason to go pro is because it works. I know that sounds silly or stupid, but it just straight up works. Like, I've seen it tens of thousands of time over the last seven years. Just listen to some of our members. So Aaron said, the Bigger Pockets.

are my go-to for analyzing properties. There's no way I can analyze the volume of properties I do without being a pro member. I locked up my first 33 unit almost a year ago and now selling for almost a 70K profit that will go towards something larger, bigger pockets calculators. We're a huge factor in making sure my numbers were right. That's exactly what I've been talking about everyone, right? You have to be able to do analyze. I love that he says analyze the volume of properties I do because that's what we're talking about, right? You have to, it's a numbers game.

You have to be able to run these deals, a lot of times. Patrick says back in June, I intended a webinar right after I signed up for pro. Next couple of weeks, I analyzed a bunch of deals. Eventually, I found a fourplex got under contracts three weeks later after signing up for pro. That's amazing, right? He ran a bunch of deals. He was patient and found the four plaques, got it under contract. That's amazing.

Super proud of Patrick. So just for being here today, if you want to go pro, again, not for everyone. We want people who are ready to take action to do this. If you're not, that's okay. But if you are ready, if you want to take action, make this change, you can do that. Just use the code pro rental. And you'll get 20% off, which is a screaming deal. That's 20% that you can use towards other stuff.

So how much is it? I'm sure you've seen some people on the internet who sell their training courses for $10,000. Hell, I've seen $25,000. bucks. So what does Bigger Pockets pro cost? It costs $390.90. That's it. It's not because it's worth less than the other ones. It's because what I told you at the beginning, Bigger Pockets genuinely believes that everyone can pursue financial freedom through real estate and should. And so we have priced it at the point where everyone who wants to take action and to get into real estate investing

can do it. And with actually with the 20% off, it actually goes down to 312. So that's an even and better deal. Use the code of pro rental, 20% off and you will get off pro annual membership. And we actually have a couple of bonuses here. So I mentioned this earlier, but if you are, you know, if you're stuck on one of the three Ds, which is dollars, we have a investing with no or low money down workshop hosted by Brandon Turner and David Green. That's a $200 value for your pro membership. So you can get that completely for free. You can also get the finding great deal. So if the other D is bothering you finding deals, you can get the finding great deals masterclass with incredible real estate investors.

We have Elliott Smith, Nate Robbins, Lance Wakefield. That is like a $1,000 value is what we assign that as. And you'll get that entirely for free if you sign up for pro right now using that code. And so just look at what a deal is. It's over $1,000 in bonuses and you can get that all today. And if you're already pro, good for you. Hopefully you're enjoying and I'm sure you are. You can get these bonuses as well.

We want to spread the love. Go to biggerpockets.com slash pro upgrade and just enter the same code. And you'll get that as well if you are already pro. So you actually have to be annual to get all these bonuses. That is just part of the deal. 20% off. We don't want people to just take the bonuses and run. But I just want you to know you can also get your money back.

So we just want people who are ready to take action to do this. So if you're one of those people, go pro right now and we'll give you your money back if you don't like it. If you decide this isn't for me or something came up or whatever it is, no questions asked. We'll give you 100% refund. We just want people to go check it out. You know, hopefully you're excited. You're ready to take that action to build that momentum.

And this is a logical next step if you're ready for it. So again, as Jim said, if you really want to do something, you'll find a way. If you don't, you'll find an excuse. Hopefully, this webinar has shown you some things that you can do today to get over the fear of the market of not being able to find dollars or deals or direction. We've taught you a process to do the lap system, to find leads, to analyze deals, to pursue them. You can do this.

Tens of thousands, hundreds of thousands of people have done this before. I've seen it with my own eyes. And I am confident that you could do this as well. So if you're ready to do that and you want to go pro, great, biggerpockets.com slash pro upgrade. And I hope you all learned a lot from this. Again, if you want to interact with me, if you have any questions about this webinar, I'm happy to answer it. I'm very active on Instagram. Again, my handle is at the data deli.

Hopefully, this has been useful to you guys. If you want to go pro again, biggerpockets.com slash pro upgrade. I hope you all had fun and I will see you all again in the future. I put out these webinars pretty regularly. And if you want to learn, I do one on multifamily. I do a couple other ones. So definitely come check those out in the future. Thanks again for watching.

And good luck to you all on your path to financial freedom. All right. That was our show. Dave, what are you thinking? Well, I hope you liked it. I would love to hear your thoughts on it. Yeah, I mean, I hope people take away, obviously, the practical tips and tools. But just wanted to get back to sort of what we were talking.

about at the top of the show. And there's something that I mentioned in the in the in the in the presentation is that I think every single experienced investor I know is like pretty excited to be buying right now and is like feeling pretty good about the market right now. Do you feel the same way? And is that true? Like are most people most of your investor friends also pretty active right now? Yeah. I would say that the people that are I don't want to say full time or professional real estate investors, but I'd say the people whose identity is most closely tied to investing in real estate versus a job they have or something else they do. There's a lot of people that kind of do this just on the side, right? They love running marathons and they buy real estate every once in a while.

But the people that are like hardcore about it are buying a lot of real estate right now. I'm one of those people. So I have not been this excited or having this much fun buying real estate in years. It has been a long time, probably since 2015 or so, where I have, I was this gung ho and excited and most of the deals I'm buying, I was like happy about it. Right? Like usually it's well, I'll take it, but I don't love it, right? That's how it's been for the last couple years. I was still buying.

I just wasn't buying as often and I wasn't putting as much energy into looking at real estate because so many other people were doing it. I didn't want to go compete with 11 other people for the same house and burn all the energy. You have to spend analyzing deals and then it doesn't work out. Well, now there's much like that. as competition. There's a lot of people that have stepped out thinking that we're going to have a crash. There's a lot of gurus. Now, I will say this. The majority of the gurus that I hear calling for a crash are not real estate people. They are stock people. They're crypto people. They're business

owners that don't understand the lack of supply in our market that are just thinking about what happened in 2010 and assuming that when there's a recession, that means that the real estate market crashes. If you understand the fundamentals of real estate, you know that's not necessarily true. Do I think there's going to be a correction? Yes. Do I think that if rates continue to go up, demands going to continue to go down, which will in many cases bring prices down? Yes, I absolutely do think that. I just buy in areas where that's less likely to happen. I look for value at opportunity, so even if that happens, I'm okay. I'm aware of the fact that even if the value of the asset goes down, whoever is buying it is probably going to have the same or a higher payment

than me because they have a higher interest rate in that situation. So it's okay. the value of the asset doesn't really matter. The cash flow that it brings in matters and eventually it's going to turn around. So I've made peace with the fact that there's always a hurdle in every market and you need to be grateful for those hurdles because that's what keeps all your competition out. Yeah, absolutely. I mean, it's just going back to the presentation, like you, you are familiar obviously with the lapse system.

Like just think about it. If you're getting into it right now, as David was just saying, you can always find deal flow. Like you can always identify leads. But right now is an easier time to identify leads than it has been at least in the last two or three years and maybe longer. And that's just a great way to be able to get started. You're going to be able to look at a lot more deals. You're going to be able to analyze a lot more potential deals.

And when you do offer on properties, you're going to be facing a lot less competition. So hopefully that's going to encourage people, whether you're just getting into real estate or maybe you've been waiting to see what's going to happen. You heard it from David, who's one of the most prolific investors out there, that he's excited to buy and that there's good deals to be had. So yeah, totally get it and agree with you that there is likely going to be a correction. I don't know if that's going to happen in every market. I think when I look at some of the fundamentals, I see specific markets that nothing's really

changed. They look really strong, to be honest. Some look pretty scary. You know, I think it's going to be really hit or miss. And, you know, that's why you have to be sort of an expert on your local market. I actually just wrote an article about the Sun Bigger Pockets. You can go check it out. And you can actually download all the data for local markets.

But I'm with you. I'm excited. You know, I'm not at the same quantity as you are. But I'm definitely excited to be active in this type of environment. So what are some of the markets that you've sort of been exploring? I know I was watching one of your videos and you talked about I'm a Denver investor, but now I'm kind of looking outside of Denver. And of course, you're the data guy.

So what's going on in the data guy's big brain? Totally. So I do mostly invest in Denver, but ever since I moved to Europe, I'm mostly invest in a lot of syndications. You know, if you're not familiar, it's kind of like passive style investments. And it suits me pretty well because I get to just like nerd out and pick markets because that's sort of the nature of syndications is you get to pick your operator, you get to pick your market.

And I still think parts of central Texas and North Texas are really strong. There are parts of Florida. Miami's like market is still like really good. I think Tampa is still a really strong long-term market. And, you know, I've actually just invested in a syndication one in Alabama, one in Virginia. So I think there's good places all around right now. It really depends city to city. not just state to state.

Like you look at certain states, I think especially in the South where some markets are really overheated and some are really fundamentally sound. So definitely recommend you look into, you know, the South East in particular. But even the Midwest is starting to look good. So there's definitely good opportunities. What is it you like about the South that you think is leading to those being good opportunities for people? Mostly population.

you look at migration trends and you see that people are moving primarily from the northeast and the west coast to certain areas. A lot of them in Texas, Florida, North Carolina are all big net gainers of population. And that's just simple to buy in demand, right? You know, like if there's more people moving there, that's more demand that's going to push up prices. And so that's the most fundamental thing. And then you and I've talked about this before, but I think just looking at economic growth. and you can measure that in a lot of different ways, GDP. Personally, I like to look at job growth,

just seeing what kind of jobs people are getting, how high paying jobs or companies moving there. That kind of stuff is really important to me. I love that you're saying that. And we can wrap up with this. Nobody knows what's going to happen in the future. But one mistake that a real estate investor will make, especially when they're afraid,

is new people are often afraid, is when you're afraid certainty becomes much more valuable than when you're confident. When you feel really good about things, you don't need to know every detail. But when you're scared, you're like, I need to know this is going to work. So think about right before you jump out of a plane. All you're thinking about is, did my parachute get packed correctly? You're just running through in your head over and over and over, is that right?

Or you're about to jump off with a bungee cord. You're going to be looking at every single piece of equipment. Is that thing set up the right way? Well, it's very similar to the world that we live in. The problem is the snapshot of what you're looking at as far as analyzing a deal, seeing the cash flow, that is very important. You need to know this. This is a fundamental piece of being a real estate investor.

But odds are it's not going to stay five years later what it look like right now. And that's one of the things that the bigger pockets calculators will help with. They'll actually project out if we just have 3% rent growth. This is what your cash flow will look like in five years and 10 years and 15 years. Well, if you invest in the right areas, you're going to see much more than a 3% growth. I mean, inflation right now is climbing and it was at 9.1 at the last point. And that's not including housing, I don't think. So it's probably higher in the real estate market than it was in the CPI.

Point is investing in the right markets, even if things go wrong you didn't expect. You have the typical toilet problem. You have a bad tenant. You have something that goes wrong. You will be bailed out by increasing rents, increasing home values, and increasing demand for people that want to live in or buy your asset. So pay attention to the information bigger pockets is putting out there, particularly through Dave, about markets that we like, places that. we're investing, why we like them, population growth, businesses moving to the area, pair that with the basic X's and O's of knowing how to analyze a deal, and it should do a lot to

take away your fear of getting started. I love it. Beautiful way to end. Couldn't agree more. All right. Thank you, everybody, for your attention. We know you could be getting this information from multiple sources, and we really appreciate that you're coming to us to get it.

We will continue to do our best to serve you right. Please leave us a comment if you're listening to this on YouTube and let us know what you thought about this. And if you're listening to it as a podcast, leave us a review, whether it's iTunes, Spotify, Stitcher, wherever you listen. We would really appreciate that. We love you for it. This is David Green for David the Data Deli Meyer signing off. 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.

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