BiggerPockets Real Estate Podcast - I Built a $12K/Month Rental Portfolio While Working 9-5

Episode Date: September 8, 2025

After a fateful encounter with a real estate investor on vacation, Pratik Shah's eyes were opened to the possibilities of real estate investing. Now, just eight years later, he has a rental property portfolio producing $12,000 per month in pure profit. Even better, he accomplished it all while working a 9-to-5 job, buying rental properties on the side, and managing them from afar. No creative financing strategies, no off-market deal hunting, just picking the right properties in the right markets.  Pratik's secret to a six-figure passive income stream in under a decade? Move markets when deals no longer make sense. Pratik has switched investing markets three times now, going where the cash flow is and the prices make sense. This has helped him grow his real estate portfolio while other investors complain that prices in their markets are too high.  The proof that his repeatable strategy works? An income-replacing amount of cash flow every month that could easily give him the financial freedom many of us dream of. Pratik turned a bad tenant who burned down his house into a huge payday, simple networking into rare real estate deals, and a duplex into a portfolio of just under 20 rental units!  In This Episode We Cover How Pratik built a $12,000/month passive income stream while working 9-to-5  When it's time to switch real estate investing markets for better opportunities  How Pratik made a six-figure win out of a burned-down house  No more rentals? Why Pratik is pausing on rental properties for a different strategy  Want more off-market deals? Why you need to go to meetups and connect with investors on the BiggerPockets forums!  And So Much More! Check out more resources from this show on ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠BiggerPockets.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.biggerpockets.com/blog/real-estate-1171 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠[e-mail]⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Learn more about your ad choices. Visit megaphone.fm/adchoices

This investor bought his first property less than 10 years ago. Now, he makes $12,000 per month in net cash flow, even though he lives in a high cost of living area. This could be you if you just go out there and take that first leap. Today, we're going to hear his basic, repeatable real estate investing formula that almost anyone can follow to take control of their financial future. Hey, everyone, I'm Dave Meyer, and the head of real estate investing here at Bigger Pockets,

And on this show, we teach you how to achieve financial freedom through real estate. Our guest on the show today is Pertique Shah. He's an investor based in New Jersey. And Pateek discovered real estate investing and bought his first property in 2017 when he wanted a way to use the earnings that he got from his W-2 to generate additional wealth and some passive income. And that is still his philosophy eight years later. Work a day job, save money, and buy a new property.

when the time is right. That approach has helped him grow to almost 20 units in eight years, spread between three different markets. And today we're going to hear the lessons Pertique learned from overcoming a very difficult tenant situation with his first property, how he got comfortable investing outside the expensive market where he lives, and why keeping his day job has allowed him to scale even more quickly. Let's bring on Pateek. Prateek, welcome to the Bigger Pockets podcast. Thanks so much for being here. Thanks for having me, Dave. Yes, it's going to be a good time.

Let's just jump right into it. Tell us a little bit about yourself and your background, how you first got into real estate. Sure. So I'm a pharmacist by training, live in Jersey. I got into real estate. I was actually on vacation with my wife in Italy, and we met an investor on a boat to Capri. And we're just talking to people that are on the boat. And he's like, oh, I'm from Jersey as well.

I'm like, look, that's same here. And he told me about what he did. And he's in real estate investor. So I got intrigued. We came back home. I connected with them. We had dinner. And a long story short, fast forward there, I actually bought my first deal off of him.

How big was this place? It was three bedrooms, two baths. So on each unit, it was top down. And I inherited Section A tenants. So that's the story in itself. But yeah, it was in a rough area. This was in 2017. So the market was going high, but it was still climbing a ladder.

So I got in on a great point. And honestly, I learned a ton off that house itself, whether it's managing tenants, managing toilets. You know, you hear the toilet story. It's always toilets. I never knew what a flapper was until I actually had to. When you were looking at these deals, did you have multiple options or was this kind of like, this is the deal you should buy? Or how did you pick this one?

So when I met him and I got intrigued about real estate investing, I started listening to do my own homework. Right. So I was listening to Bigger Pockets. I was reading books, just understanding how to analyze deals. And then when we met for dinner and he brought his opportunity for me, he was getting to a bigger commercial space. And so I was curious. He was like, he was 10.30 wanting some houses.

And I was like, oh, okay, these numbers pencil in. And why not buy a unit from someone that I could get experienced from that can kind of hold my hand through the first deal in a sense? Since I do have a W-2 job, this wasn't my full-time gig. And it kind of helped me along the way with the goods, the back. and the uglies, but it really got me a great kind of, I guess, a dive into the pool of real estate investing. That's the best way to do it, man.

The number one goal for your first deal should just be to learn. It's not to hit a home run. Yeah. Ideally, you do both, but yeah, absolutely just to learn. How did you finance it? Well, I mean, good question. After our vacation to Capri in Italy, I did have to build up those funds back. I kid.

No, so, but I had enough saved. And luckily, with 25% down, we were able to, finance enough to purchase that house. That makes total sense. I think it's a great way to do it as I talk about on the show a lot. Having a W-2 job does have some of its benefits. And I assume being a pharmacist, pretty solid paycheck comes in. So that's a great way to start getting into real estate investing. So you did this first deal here, Pertique. What did you do after that? So after that, I was playing basketball with the same investor that I bought the first deal from. You guys do a lot of fun stuff. This sounds like a good guy to hang out with. It's all by

chance, you know. And so we're playing basketball and we're sitting on a side and he's telling me about another house that he's offloading for a 1031 exchange. And I'm like, hey, first one went all right. Let's let me hear it. And we talked offline and I bought a second property off the same investor as well that I met in Capri. Another multifamily or Ron the block from the first one. Okay. So very nice. And how was it similar situation with inherited tenants? Was it section eight? Section 8 tenants, both up and down, both units, and these tenants were a little bit more challenging than the first unit that I bought. Okay. What was going on here? Was it non-payment or just personalities? Yeah, personalities more so. Section 8, you're pretty much guaranteed payment from the government. So that part was always covered. It was getting entry into the unit, the upkeep of the unit. I was constantly getting summons from the township for litter outside the house. So they weren't. keeping up the unit as much as I would like them too.

Sorry to hear that, man. I mean, I know there is always risk. There's risk and reward, I think, with inheriting tenants. It's not always bad, but like these things definitely can happen. So what did you do about it? Did you hold on to the property? No. This is too much of a headache.

Like I said, I have a W-2. Don't have the time to manage bad tenants, bad properties. So I actually went and tried to sell the property and had it listed to sell in 2019. Honestly, I love it. I think, you know, I rant about this all the time on the show, but people say, like, buy real estate and never sell. I just completely disagree. Like, if there's a deal that's just not working for you, get rid of it and go do something else before you burn out or lose your money on a bad investment. It's better to recognize that this isn't working for you, whether it's financial or lifestyle-wise. Like, if it's not working for you, just go sell it. That's a better thing to do.

So what was your plan? You went to go sell it where you're going to just 1031 or moving into something else? Yeah. I, you know, I had to start. started going to meetups in different markets. Most, you know, Pennsylvania is not too far, so I started hopping into Pennsylvania as well. But to be able to do that, I wanted to offload this property. Yeah, okay. That's a pretty good solution. Did it work out?

It would have. We were set to close on July 31st of 2019. I'll never forget the date. And on July 27th, three, four days prior, I get a call late night, and it's the fire inspector of the city calling me to let me know my house is on five. fire, everyone's safe, but the entire unit is damaged, fire, water, everywhere, firefighters are breaking through every window. Yeah, that's the call I got three days before closing. Obviously, the deal fell through. And so it was not able to sell a burnt down property. And that started my

journey from just being a new investor to a, essentially a flipper in a sense, because I do have to learn construction in that sense at that point. All right. Well, clearly that's a very different business, being a buy and hold investor and having to rebuild a property from scratch. Sorry you had to go through that, but I think there's probably a lot of lessons that our audience can learn from, given that you had to do this. So let's dig into that, but we do have to take a quick break. We'll be right back. You ever head out on a trip, lock your door, and think, cool, my most valuable asset is now doing absolutely nothing. Because while you're off traveling, your home is just sitting there, quiet, empty, not contributing, which feels like a missed

opportunity, considering it has solid Wi-Fi and a very comfy bed. With Airbnb's co-host network, your place can earn money while you're away. You can hire a vetted local co-host with real hosting experience to handle guest messages, prep your space, and manage reservations so everything runs smoothly. Your home might be worth more than you think. Find out how much at Airbnb.com slash host. You've upgraded how to buy properties, but did your insurance get the memo? When investors start scaling, insurance can't be an afterthought. Most policies were designed for a single property, not multiple rentals, LLC ownership, short-term stays, or properties mid-rehab. That's where blind spots can creep in.

NREG works exclusively with real estate investors. They understand portfolios, how risk compounds as you grow, and why insurance should protect your upside, not just a checkbox. One uncovered claim can undo years of progress. Before your next acquisition, review your insurance. Talk to NREG and get investor-specific coverage from specialists who actually understand real estate at nreg.com slash BPPod. That's N-R-E-I-G-G.com.

slash BP pod. Okay, we're going to shift gears for a minute to cover something important, especially for new landlords. The shows often talk about getting stuck doing everything ourselves and the cost of sweat equity. The key question is simple. Is my time better spent elsewhere? I use a tool that cuts down on a lot of landlord hassles. And the wild part is, it's just $12 a month. It handles rental screenings, rent collection, maintenance requests, and accounting,

all in one platform via a mobile app or desktop. It saves me time in tenant communication and keeps me organized for tax. season. It's called Rent Ready, and you can sign up for a six-month plan for just $1 with promo code BP 2025. Pro users get it for free because we believe in it. Just sign in through your pro account to get started. Rent Ready helps ensure on-time rent with auto reminders, keeps communication professional, and lets you post listings to multiple sites. Check it out at rentready.com slash bigger pockets. That's Rent, R-E-D-I-com slash bigger pockets. There are two kinds of real estate investors, those who have reviewed their insurance, and those who think that they have.

Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short-term rentals, or LLC-held properties. These gaps surface only when filing claims. That's why investors work with NREG. They specialize exclusively in real estate investors, understanding portfolios, risk at scale, and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered.

Have NREG review your insurance with someone who gets investing at NREG.com slash BPPod. That's n-R-E-I-G.com slash BPPod. Welcome back to the Bigger Pockets podcast. I'm here with investor Pertique Shaw, talking about how Pertique had a really pretty tough start to your vested career with, it sounds like a difficult tenant situation that moved into a unfortunate catastrophe where you had a fire burned down your entire property. So help us understand us.

Like, how did you go from not having any experience to rebuilding a multifamily property? Where did you even start? What are the steps that you had to go through? Well, first, obviously, it was the insurance company. So worked at the insurance company to line up just claims, et cetera. Started interviewing contractors, you know, had never done that before in my life, but understanding, you know, what to ask, the right questions. The biggest stories you hear now are just the trustworthiness of contractors to really getting references from other people through forums, like Bigger Pockets itself. That's how I started that process. And once I locked down a contractor, working with the insurance company to make sure their systems match for, of course, payments and stuff.

And from there, it was just selecting material from scratch. I mean, when I'm saying material, I mean, your handles that you want in your kitchen cabinets. What type of towel holder do you want in the bathrooms? What type of flooring, et cetera, that meets the insurance company's needs as well from a financial standpoint. But then it's something aesthetically pleasing you want for your own unit as well. So it was kind of marrying the both and learning how to work within a budget of an insurance company, but within the style of the current state, right? Because the unit was about 20 years old.

So you wanted to kind of transform it since you now have the ability to. For sure, yeah. So I spent a year until we got it completely rehabbed and updated. I had the house listed and to sell July of 2019. A year from that is the summer of COVID. And that was when the market was just starting to take off. And so fast forwarding a year when that unit is ready to be. sold, I had it listed and at a six-figure increase from what I had initially listed it

the year before. Oh, damn. That's awesome. I mean, so I know it's hard to say because there's probably a big pain in the butt, but like all told financially, did it actually work out better that the fire existed? Financially, yes. I mean, I would wish this upon nobody. It took several years off your life, I'm sure.

Oh, my God. Got a bigger check at the end of the day. Yes, yes. It worked out for all intents of purposes. And I learned a lot. Quite honestly, I mean, this is not a lesson I would want to learn. But in hindsight, I learned so much. It made me so much more comfortable continuing my investing journey through other markets. Just from the experience I gained from just tenant management to construction, to selling properties and working with insurance companies, I just learned so much just within this one deal itself. Yeah, man. I mean, sometimes the forcing function is actually beneficial to you long term.

when you're investing career. Like you're never going to set out and set a goal for yourself to like have to renovate a property like this when you're that earlier investing career under these exact conditions. But there is a way to spin these things that sometimes happen in real estate. If you have the right perspective, it sounds like you do critique, you figure out a way to make this work for you and to help you sort of build your portfolio. So once you got through this, sounds like it took a full year. But once you were almost back to square one where you wanted to be in the summer,

2019. What did you do from there? Yeah. So during this whole time, I wasn't just sitting and managing and crying. I was networking on bigger pockets looking for meetups. And I found a meetup in the Lehigh Valley of Pennsylvania, which is only an hour away from me. So it wasn't too far, even though it's a different state. Great market. Great market. And I started going there, networking with investors. That's one thing I love to do, just talk real estate. And I met an investor there. And rinse and repeat of my first story, I networked with it. And I networked with it. And I, him and I bought a deal off of them, which is my first deal in the Lehigh Valley, new market, new area, a whole new clientele. And it was great because I was able to, in a sense, just like the first time,

transition to a new space, but with the comfort of just having someone there to be kind of like a mentor or coach, if need be. And that was my first unit in that space. Built my comfort for the area. I inherited tenants. They were great tenants this time around. Wow, you went back too. Okay. Back to it. Touch the fire once. You're like, I'm just going to do it again. My wife would say I don't learn, but I like to say that I'm just more comfortable. You learned how to deal with it. You knew that. You could probably deal with the worst-case scenario if it happened again. But it was the best case where I took on and I learned the intricacies of the area. Every market, it has its own specifics. Lehigh Valley has a lot of inspections from

townships, but I learned how to network with the inspectors, et cetera. And lo and behold, from there I ended up buying 11 more units. So now I have 12 units in the Lehigh Valley. Let's talk about this because a lot of people in today's market live in areas where finding cash flow or the type of deal that they want to buy is inaccessible either because it's too expensive or there's just not that kind of inventory on the market. So you basically said you chose Lehigh Valley, but was there other markets that you were looking at as well? I was looking at Indianapolis at the time in Cleveland, which are all great markets still to his date. but I think I like the aspect of still being able to self-manage to a degree because I was still smaller at the time. Yeah.

Where I take, you know, 10% typically is property management costs, sometimes 8%. And that was a big chunk of change. So I was able to place my own tenants. And what I've identified by placing my own tenants in that area is if I do the legwork early on and really identify the best tenant for that unit, that will make my real estate investing journey so much easier because I'm not just putting someone in there that meets, you know, credit score, a background check, et cetera. I'm talking to the people.

I'm getting a feel for their, for why they need the unit. And I think that speaks so much more in the long run because they treat your house better. They pay on time. There's so many less issues down the road where I don't really need a property manager for that area itself. Yeah. And it creates mutual benefit, right? It's good for you.

Obviously, you're probably going to have less. turnover, less wear and tear on your property. Yeah. But you're also finding someone who's going to be really happy in the unit that you're offering, which is just a win-win situation. This is, I think, a really important pivot point for a lot of investors is really like getting people in the fastest and at the highest rate is not always the best situation. If you find people who are going to truly love living in your house and who are going to

take care of it, that's like a mutual benefit that will make your life easier. But it also will improve your returns. You'll have fewer vacancies. You'll have less wear and tear, less maintenance costs, and that's just a benefit for everyone. And I'll share a quick story. One of my tenants and one of the houses in the Lehigh Valley that I placed, and it's a high rental market. So once I've never had a vacancy in that area amongst all 12 homes. You have people wanting to rent the next day.

And so I had a unit open. I had a bunch of applications and I went there. I'll do phone screens from my house. And I'll narrow it down to maybe five or ten folks. I really want to move forward to have them see the unit. And I found this guy that wanted to rent the place, and I did a background check, and it came up with some red flags, right? And the red flags were from prior drug use and selling, et cetera. But when I talked to him, I really found a sense of genuine nature and authenticity from speaking with him.

So I confronted him. I'm like, hey, David, I like you, and I really want you to rent this unit. However, I saw that there's some red flags. And he explained it to me. He's like, hey, this was in the past, full disclosure. I'm a better person. I've changed my ways. I just can't get a house because this comes up and no one will rent to me.

And some of it's just through a conversation. That's where I mean where I'm able to do it myself and physically see the person. I was sold on a sense of genuineness and I rented out to him. And he's one of my best tenants. He's putting backslash in the kitchens. He's redone some of the flooring. He painted the walls. Pays on time every month.

He's been there for five. years, if not longer. And he's one of my favorite tenants and all because I gave him a chance. Fantastic. And that's something you're not going to get from a credit score check, a background check, et cetera, when you're checking boxes because he wouldn't have never met those. Yeah. Well, good for you for doing the work of being a landlord and actually, you know, meeting people talking to people, doing the networking. We talk about it all the time, but this is it, it's a relationship business. It's a people business. And you were able to find a great tenant who likes your properties taking care of it. That's a type of mutual benefit that we are

always trying to promote here. All right. So that was what? 2021, you say? 2018 all the way until current. We're still going. Okay. And like I said, I was still, you know, I was just throwing darks out of map, honestly, looking for other markets. So I did find, I did dive into another market too. And 2020 was my first year. And this is a complete left field, because this is not near my backyard. It was not drivable. I still have never been to this area. Really? It was in, yeah, North Carolina. There's a big army base in North Carolina. Fayville, Fayville, Fayville. Yeah, okay, yeah, all right.

Four Bragg, for Bragg. Yeah, nice. And so I had a buddy, shout out to Travis. He was a buddy of mine, and he's like, he lives in Raleigh, and he's like, it's an hour away. Did you meet him somewhere super cool, like paragliding or backcountry skiing? I wish, I wish. This is more boring as we work together. It's complete opposite.

But it's funny you say that where we were listening, we both had mutual interest not only from work, but from real estate investing as well, or at least intrigued about it. And we heard there was this lady on bigger pockets and she was from Fayetteville. And he's like, hey, that's like an hour away from me. Let's look at this market. I'm like, sure. And we dove in there and have a bunch of units in Fayetteville as well now. I want to talk to you about this, though, too, because when we talk about out-of-state investing, I think it's intimidating for people just to do one market that they are not intimately familiar with. But you're doing two. And I'm curious, like the pros and cons and how that's working out for you, but we've got to take one more quick break. We'll be right back.

There are two kinds of real estate investors, those who have reviewed their insurance, and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short-term rentals, or LLC-held properties. These gaps surface only when filing claims. That's why investors work with NREG. They specialize exclusively in real estate investors, understanding portfolios, risk at scale, and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered. Have NREG review your insurance with someone who gets investing at NREG.com slash BPPod.

That's N-R-E-I-G.com slash B-PPod. The rise of the tech-savvy investors here. You don't need a huge team or tons of overhead to manage rental properties. Just the right tools. So I want to tell you about how I use rent-ready to get ahead. For landlords who treat their time like capital and recognize the cost of sweat equity, this tool gives you everything you need to scale. Rent collection, tenant screening, maintenance accounting,

so that you're organized come to. tax season, and you can run numbers in preparation for future deals, and more, all in one platform via a mobile app or desktop. Modern landlords don't just own property. They optimize it. Rent Ready will keep you organized, running leaner, and ready to grow. Start with RentReady. Visit RentReady.com bigger pockets. That's RentR-E-D-I.com slash Bigger Pockets. And use code BP 2025 to get RentReady's six-month plan for a dollar. There are two kinds of real estate investors, those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short-term rentals, or LLC-held properties. These gaps

surface only when filing claims. That's why investors work with NREG. They specialize exclusively in real estate investors, understanding portfolios, risk at scale, and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered. Have NREG review your insurance with someone who gets investing at NREG.com slash BPPod. That's N-R-E-I-G dot com slash BP pod. You just realized your business needed to hire someone yesterday. How can you find amazing candidates fast? Easy.

Just use Indeed. When it comes to hiring, Indeed is all you need. That means you can stop struggling to get your job notice on other job sites. Indeed, sponsored job posts help you stand out and hire the right people quickly. Your job post jumps straight to the top of the page where your ideal candidates are looking. And it works. Sponsored jobs on Indeed get 45% more application. the non-sponsored post. The best part, no monthly subscriptions or long-term contracts. You only pay for

results. And speaking of results, in the minute I've been talking to you, 23 people just got hired through Indeed worldwide. There's no need to wait any longer. Speed up your hiring right now with Indeed. And listeners of the show will get a $75 sponsored job credit to get your jobs more visibility at Indeed.com slash rookie. Just go to Indeed.com slash rookie right now and support our show by saying you heard about Indeed on this podcast. That's Indeed.com slash rookie. Terms and conditions apply. Hiring Indeed is all you need.

Welcome back to the Bigger Pockets podcast. I'm here with Investor Partique Shaw talking about how he scaled his portfolio. First, by pivoting to the Lehigh Valley in Pennsylvania. Then you just picked a market in North Carolina that you'd never been to to have a second out-of-state market. So tell me first, why? you wanted to find another market where there's just not enough deals in the Lehigh Valley or did you want to diversify? What led to that decision? Because it can be a lot of work. It was honestly

both. I think just increasing the deal funnel. And as the years progressed, it was getting harder and harder. Numbers were getting shorter and shorter in terms of cash on cash returns. You have more investors that are more interested in the market as well. So you have a lot of competition through other investors that are trying to get in. So I figured if I look for multiple markets, I have a better chance of getting some deals and increasing my deal flow. Did you have some certain amount of units you were trying to build towards per year, or were you just basically trying to take any opportunity you saw? Any opportunity.

I didn't care much for the numbers or how many doors I had. I was more so just trying to increase the passive income. Like I mentioned, I have a W2 that I love, I enjoy. I have no desire to give it up. But I just feel like I'm a real estate junkie. I just love crunching numbers and when it makes sense. just why not pull the trigger, right? So it's been working out so far. Man, this is like the kind of investing I love. It's like we're talking about

keeping your W-2 job and being really analytical about investing. We share a lot of philosophy around real estate investing. So what was it like? I actually always advocate for people to go to these places before they do long-distance investing. How did you get comfortable with a place you had literally never been? It was quite a bit of anxiety at the first we're not being able to see, walk the unit and having, trusting an agent to do that. But once you build out the team and get a good rapport with the people that you're working with, you have that sense of comfort, right? And so we did a trial deal and it worked out.

And that kind of was a proof of concept to purchase more and out of state as well. In my experience, the calling of contractors and maintenance thing is probably the first thing that gives people anxiety about investing in long state. But the thing I have a hard time with not having been somewhere is knowing what neighborhood to buy within a market. Because you can do a ton of analytics and look at all the numbers and all that and say, I know Fayetteville. I mentioned it because it's traditionally been a really strong market.

But within every market, there's good neighborhoods you want to buy. And there's ones you probably want to stay away from, whether it's because it's just not the kinds of assets. There's not the right housing stock. It's not in the path of progress. So, like, how did you figure that out without ever having gone? Dave, I don't know if this speaks to you, but I'm sure it speaks to some people. I printed out a Google map of Fayetteville.

Okay. I like this. Yeah. I went with my agent that was working with, and I told them, all right. Like, I printed out for myself just circle neighborhoods. And I got on fun with them, and we went to neighborhood to neighborhood. Because everyone knows every city in itself, no matter how small it is, has different neighborhoods, right? Different school districts.

So I circled what's a good area for school districts? What streets? He was like, I'm not going to say this street because I don't know if anyone lives on this street, but he's like, this street, this road, stay away. Right. Yeah. Do not go anywhere near that because that is just rough. So I would have X's on my printed out Google maps. I would put X's on the map. And it pretty much had essentially a treasure map in a sense of where I circled and where I exed. And I went on Zillow or go on Realtor.com, wherever. And I would just look for properties within my buy box of like three beds, four beds, et cetera, in those circled markets on my map. And that. That's kind of how I went by block by block. Because like you mentioned, there's some areas that you just don't know that they're near manufacturing sites so people don't want to live there. And you can't tell that always from just a Google map, right? So that's where doing your homework is very important and also having a good relationship

with your agent that is boots on the ground that has that intricate information of the street-by-street knowledge is very, very important and critical. Okay, but why have you still not gone? Why would I? I have no It's made in North Carolina. I don't know. I don't know.

It's worked out. I would love to go one day if the stars align. But, you know, I've learned. You're braver than me. I've learned, you know, it's not needed. Honestly, if you have trust in a team

and like I said, if you do the work ahead of time before you pull the triggered and get the right team behind you, you don't really have to be there physically. Do you notice a difference between the performance of your deals in the Lehigh Valley

and Fayetteville? Are they both doing well? Yes. And you have actually mentioned this before. So I laughed to myself when you asked me that question because you've mentioned Fayetteville before. And I've noticed that the appreciation has stalled somewhat to a point where Fayetteville was historically a cash flowing market. And with most markets over the past five, six years, they've all appreciated pretty much across the radar. I don't think the rents have kept up as much.

So I've noticed that the rents aren't as keeping as much as the appreciation. And so that's an analysis I need to do. I still have those units because they're doing well for me for what I bought in with. But, you know, my IRA on my equity, I got to go back and do those equations. Yeah. Yeah, that makes sense. I mean, it doesn't mean you can't buy there, but probably means you have to pay less, right? You need to just be a little more disciplined about what you're offering.

Exactly. So it sounds like you're sort of like going through that exercise of trying to figure out like, should I hold on to this or is there a better deal? So have you done that analysis? And is there something else you're going to try and. pivot to? I have started transitioning into flipping side of things. So I've looked into another market. So sorry, Dave. I'm going to add a third market on your plate. You're just like, okay, I work at W2 job. I've gotten to this to be a rental property investor. Now I have properties in three different markets and started flipping. It's very, uh, it's an unusual

track, but I like it. Honestly, I say it's unusual, but honestly, I'm doing the exact same thing. Like my portfolio looks pretty similar. So maybe we're more similar. But so tell me, first tell me why. Like what about the analysis led you to think flipping might be the better way for you to go right now? Quite honestly, it's like I mentioned, I have a W-2, so I have this capital. It's harder to find long-term deals that pencil. And I've traditionally stayed to single family and small multifamilies. And with just residential buyers, I'm getting beat out.

I'm still putting in offers, but I'm getting beat out to a point where it doesn't make sense to invest. But when you have someone emotionally invested into the porch or into the house and the location, that they're going to spend the extra money that they want to, which rightfully so, where it kind of beats you out as an investor. So I started working in Newmarket, Pittsburgh specifically. I know you guys have mentioned this before on the podcast. And I started doing flips in the Pittsburgh, Greater Pittsburgh and suburban market there. Okay, nice. And what was the analysis there?

You just did the math and that made the most sense to you? It was the balance between passive income that's coming in from the properties that I have in the other two markets. and coupling that with just maybe some just a different space of higher returns, even though obviously they're shorter time frame. You have capital gains taxes that are different from short-term gains versus long-term games, of course. But in a sense of just doing construction, I kind of got maybe that bug was put in with that Elizabeth house, but I just enjoy it.

Like being able to look at a house and seeing how, what type of flooring, what type of paint do you want? And to be completely honest with you, and I hate if this. the secret's going to get out, it's so much easier. I mean, I don't, once you find a deal that pencils and you find a trustworthy contractor, which is hard in itself, but once that's done, I mean, the hardest step is really figuring out what color combinations and paint pallets you want to match the flooring, really. And it's quite easy in that sense, where, you know, three, four months, if it's a typical

cosmetic rehab, you could make great returns just in a few, in a short time frame. That makes sense to me because I'm actually, I, well, knock on wood, I'm supposed to close on my first flip that I'm going to be actively involved in on Friday. So I'm also trying to do the thing because I've done some passive flipping deals before, but I'm going to try this out. How are you managing that with your time? Because like you work full time. So how much time does this take and is it, you know, is it getting to the point where you're sort of like reaching a limit in terms of how much you can contribute time-wise to your portfolio? Yeah. So, I mean, in terms of the deal for.

flow, that's the agent. The agent brings me deals. And within a few minutes, you could kind of pencil in to see if it makes sense to dive in a little bit deeper or doesn't make sense for your returns at all. And you always want to be cautious. Even if you're a trust agent, you want to do your due diligence and look at comps and analyze them and get a real comfort for if you trust those comps. But once that's done, once you lock in a deal and you actually get it, of course, after running the numbers, I have a contracting team out there that I've got a build a relationship with that's very trustworthy and the communications on point and so i've been working with them which i really enjoy so then it's really just picking the material and the specs of what you want

and you know like i mentioned i have a w-2 job i'm working throughout the day i travel quite a bit for work as well but in the evenings i'm able to just ahead of time if you give the contractor this is what i want ahead of time it helps you out because it saves the back and forth with with them right if you give them all that stuff in a spreadsheet in advance they could review it and then this just more of an execution timeline where you're more of just a project manager, that's all. Would you do multiple at one time? I haven't yet, but I would love to. I mean, Dave.

Okay. You're just going for it. I'm just going for it. You know, my philosophy is just jump in. I can always figure it out in the back end. But if you have the means to it, of course, if you're not completely stretching yourself, and quite honestly, I enjoy this. I mean, I actually enjoy just running numbers, running deals, seeing them come through.

It's fun for me. And I think that's probably why I've been able to jump in quite a bit where I'm thoroughly having a good time doing so. That's, I mean, if you're enjoying this and you're making money, I mean, just keep going for it. That's awesome. So before we get out of here, Pateek, just tell us, like, what's the state of your portfolio today? Sure. So I have just under 20 units that are split between the eastern Pennsylvania markets and North Carolina market. I dive into anything that's single family and small multifamilies, of course.

And so that's been steady rolling, a cash flowing just. to rent around 12,000 a month net after expenses for those units. And like I mentioned, I'm moving into flipping. I'm just trying to increase that business and that side of things, always looking at new markets. And one thing I haven't explored yet, which I'm super interested in is private lending. You know I love private lending. Like I mentioned, I have a W-2, so that does afford me the luxury of doing that. And I love real estate and I love crunching numbers. So if I'm able to lend to somebody to do the work where I physically, may not be able to since I have a full-time job.

By the same point, understanding the risks associated with that, knowing that I understand how to crunch numbers, it gives me a good opportunity where something I've really been intrigued in, but haven't really jumped in just yet. Very cool. Well, is there, like, are you working towards a, like a unit goal or a passive income goal? Are you just going to sort of do this for as long as you can because you enjoy it? I would love to have one unit and getting, to get to get.

12,000. I would love that. That's everyone's dream. But no, I don't mind how many number of doors. I think it's more, you know, I have an unofficial goal of like 25,000. And there's no reason behind that number, but I would like 25,000 a month and cash flow. That would be nice. But that doesn't mean I'd quit my job.

I truly enjoy what I do. So I just, yeah, at the end of day, just want to keep growing. I want to keep having fun, right? It's a great attitude. I've understood the market of just renting and purchasing long-term investments, which has been going well. I'm trying to learn, of course, about just the flipping business. And of course, at the same time, I would love to privately lend as well.

Sweet. Well, good luck to you, Pertig. We'd love to hear from you in the future as you update and continue on this path. Maybe we'll have you back to hear how you've been growing in the next couple of years. I appreciate it. Thanks for having me, Dave. Thank you all so much for listening to this episode of the Bigger Pockets podcast. I'm Dave Meyer.

See you next time. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing. 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. Copywriting is by Calicoke content, and editing is by Exodus Media.

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

for direct, indirect, consequential, or other damages arising from a reliance on information presented in this podcast.