Epic Real Estate Investing - The Death of Your Business and How to Avoid It | 1214

Episode Date: June 23, 2022

What are the business essentials to survive the next year? The economy is throwing us curve balls seemingly daily. What is a reel estate entrepreneur to do? Matt will run you through five things you will need to pull through this and if you do it right, you will fare better than you have in the last ten years. Stay tuned and find out more!   BUT BEFORE THAT, Matt talks about how to buy Non-Fungible Tokens (NFT) real estate.     Are you ready?   Let’s go! Learn more about your ad choices. Visit megaphone.fm/adchoices

This is Terio Media. How to buy NFT real estate. You're wondering. I get it. Everybody's talking about it. And like me, you may be curious as to what this means for the future of real estate investing. I mean, I'm paying attention and I'm doing my research. And if you like making money, you're going to want to know what I found.

You ready? Let's go. Welcome to the all-new, epic real estate investing show. The longest running real estate investing podcast on the interwebs, your source for housing market updates, creative investing strategies, and everything else you need to retire early. Some audio may be pulled from our weekly videos and may require visual support. To get the full premium experience, check out Epic Real Estate's YouTube channel, epic rei.tv. If you want to make money in real estate, sit tight and stay tuned.

If you want to go far, share this with a friend. If you want to go fast, go to reiase.com. Matt. Okay, by the time we're done here, you'll know how to buy a real estate NFT and what it means for the future of investing. Oh, and by the way, if you're still looking to get that first deal under your belt in the real world, I put together a free training just for you to help you get that first one done and then how to earn $5,000 a month flipping contracts and properties working as little as one hour a day, and you can access it for free at mat's free training.com. Right now, it seems like everyone is talking about NFTs. You hear them referenced in and many different contracts.

from photos, videos, audios, and what we're talking about here today in real estate. I probably, like you, are straddling the offense between, you know, I don't want to mess around with this weird stuff, and then also seems like there's a lot of money being made over here, and maybe I shouldn't be ignoring it. I mean, can you relate? Well, I'm diving in, and here's the biggest reason why. I remember when I was in the music business, and the digital download came along, and I completely snubbed my nose at it, thinking, who in their right mind would,

want to give up the experience of walking into a music store and thumbing through the crates digging for that next gem. Well, apparently everybody, as you'd be hard-pressed to find crates of records these days, let alone a music store. I know they're still out there, but they used to be on every corner. Anyway, that's not the point here. The point is that me ignoring technology in the past, ignoring progress, ignoring emerging cultures, all of that sticking my head in the sand and ignoring the direction that my industry was headed, that put me out of business. So I learned my lesson. I'm not going to be that guy this time. So the real estate NFT has my attention, and I'm becoming a student of this new game. And a very wise person once said to me, he said,

the best way to learn something is to teach it as soon as you learn it. So I'm going to teach you what I've learned up to this point. So NFT stands for non-fungible token. This is a non-interchangeable unit of data stored on a blockchain, a form of digital ledger that can be sold and traded. And NFT is not an actual cryptocurrency in the same sense as, say, Bitcoin, but they live in the same digital world, so to speak. A cryptocurrency utilizes blockchain technology for its ability to track financial transactions between parties. They were designed as a type of digital currency for use on the internet and in a digital first world. NFTs are also built on a blockchain, but instead are used to guarantee ownership of an asset.

So I guess you think of it as a certificate, such as an auto or real estate title stating the legal owner of a car or home, except that an NFT is proof of ownership in digital form. Most NFTs are based on the Ethereum blockchain network. So these NFTs seem to be in the news almost every day, from record-breaking prices for NFT art to NFTs used as marketing tools for popular fast food chains, the trend seems to be really catching on, and a lot of money is exchanging hands as it does. So as a gimmick or collectible, sometimes both, NFTs are easy to implement and

execute. But it's proving to be a much bigger challenge to apply them to slow to change industries, such as real estate. So in the past year, experimental uses of NFTs have been popping up in the industry. Everything from building projects to lending are being tested as NFTs. Various companies and individuals are looking to improve our rather slow and inefficient document-heavy business. In the context of real estate, NFTs are nothing more than unique digital titles or tokens to property, either real or virtual that are stored on a blockchain ledger. And I'm starting to understand blockchain as the next evolution of the Internet. It's easier for me to wrap my mind around it if I just keep reminding myself of that.

But theoretically, using NFTs in real estate can reduce the risks of harm due to fraud and can improve the ability of an owner to prove that they do, in fact, own real estate in a more secure way. Merging a digital world with the real world is still a work in progress that some of the smartest minds on the planet are taking on. At the moment, though, there are two types of tokenizations involved in real estate, entire asset, EA, and fractional ownership, FO. FO tokenization is fairly simple.

It's similar to a crowdfunding platform or other similar structure that allows investors to buy shares of real estate. Each fractional owner holds a number of tokens that represents shares in the project, depending on how the investment is structured. FO tokenization is already being used in limited cases in the real estate industry. EA tokenization, on the other hand, cannot work unless the actual property deed is turned into an NFT. This is still incredibly difficult to accomplish due to the regulatory environment surrounding real estate investments. But this past February, a home in Gulfport, Florida, was auctioned for the equivalent of 600, $154,000 and is being billed as the first home in the United States to be sold as a non-fundable

token. It's questionable as to whether this is exactly how NFTs will be used in EA sales moving forward, but it does show that steps continue to be taken to move the ball down the field. There's plenty of kinks to iron out when it comes to registering individual physical homes as NFTs. But digital real estate can easily be registered using NFTs right now. Digital real estate doesn't really have any regulatory rules since it exists in a virtual world. That's the financially regulated equivalent of the Wild West. So, what's digital real estate you might be thinking? I understand.

I had the same question. Digital real estate exists in virtual spaces, often referred to as the Metaverse or sandbox platforms, where users can interact with and construct almost anything that they want. You know, if you've got kids, you may be familiar with the game Minecraft. That's an example of a Metaverse. Other common platforms include Robo which is my son's game of choice.

This is the real deal, too. Roblox is publicly traded on the New York Stock Exchange. Decentraland is another metaverse, Axi Infinity is another, Uplen and Cryptovoxels or others. So there's a number of these metaverses already in existence where you can purchase digital real estate as NFTs.

So just like real life real estate, virtual real estate lots are designated parcels within the space designated for that platform. So there's a limit on how many parcels are available, depending on the platform. and that creates scarcity in the same way that there's only so much land in the physical work. So how do real estate NFTs work and how do you buy them? Well, real estate NFTs work just like any other NFT. They're purchased using a cryptocurrency of the seller's choosing held in a digital wallet.

And once owned, they can be sold again or in real estate terms flipped for a profit. Use of NFTs are starting to be incorporated into the mortgage industry also. Not yet widely used in mortgage products, but they may become more popular. Loan Snap, using its Bacon Protocol, has offered the first NFT mortgages in the form of home equity loans. They process loans just like regular mortgages, but issue NFTs instead of simply creating mortgage notes with the liens. So far, just a handful of NFT mortgages have been minted and are not yet available for mortgage note or crypto investors to consider for their portfolios. However, Loansnaps plans to issue a stable coin called B-Hung, which will represent fractional ownership and NFT mortgage notes. So so far, sounds kind of cool.

But because real estate NFTs are so new, it's difficult to really gauge their strengths and weaknesses. There are currently a lot of experiments taking place that will help investors to better understand where NFTs can and cannot be applied within the real estate industry. However, we do know a few things. First, real estate NFTs, like any other NFTs, promise easily traceable, secure records of ownership for a wide range of real estate investments. Second, they will allow the purchase and sale of real estate in virtual worlds, which are emerging as an investing frontier.

On the other hand, like anything in the crypto world, real estate NFTs are generally not guaranteed, and their value can go to zero with no warning. Real estate related to virtual real estate will be especially risky investments for some time. These NFTs that represent fractional ownership in real world investments should be more stable. So what could it look like in the future? Well, right now, from what I see, the marriage of real estate and NFTs looks very promising. But it's in such an early stage that is hard to make predictions. NFTs, in theory, can provide easy ways to transfer ownership of shares in real estate investments or virtual real estate. But don't expect them to be incorporated into standard operating procedures of transferring whole properties anytime soon.

Although, it is coming. Current real estate laws make it very difficult to hold real estate properties as NFTs. As blockchain technology and other tools in the crypto toolbox prove increasingly useful for things such as creating mortgages and generating crowdfunding opportunities, it's likely they will change. Until then, with regard to real world real estate, look for opportunities to hold portions of mortgage debt, building projects, and other group investments as NFTs. So I'm going to be diving deeper into the digital real estate world, and I'm going to keep you posted as to what I learn and how I plan on incorporating it into my diversified investing. strategy. If you'd like to explore the possibility of working together one-on-one and becoming a master creative real estate investor in the real world, with a coach that doesn't shut the door to any profitable possibility, go to rei-aise.com, answer a few questions, and then just pick a time

for us to hop on the phone and brainstorm some ideas about getting you to the next level of your real estate investing. That's at rei-aise.com. Please stand by. We've got overhead to pay. We'll be right Back. Boarding for flight 246 to Toronto is delayed 50 minutes. Ugh, what? Sounds like Ojo time. Play Ojo? Great idea. Feel the fun with all the latest slots in live casino games and with no

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Neither do I. Let's keep going. Back to the show. So I want to talk about the depth of your business and how to avoid it. And I'm talking about it in the context of our Legends challenge. And this is why I decided to do this challenge again because we're dealing with some major stuff in the economies, which I'll know. And it's got quite a few people concerned.

and maybe downright scared. And, you know, we're talking about inflation, right? 8.6 percent, which is like 4 or 5. It's four times the normal rate of what we want our economy to run. I don't know if you guys knew this or not, but when they calculate those inflation numbers, they don't calculate food and gas. And that's where it's really kind of hitting us the hardest.

So it's probably a lot higher than 8.6%. The debt is increasing. We're having this. The gap between the rich and the poor is getting wider and wide. We are our imports and exports are totally out of balance. We're importing way more than we export. We're like the country or the globe's best customer. And that best vendor typically right now is going to be is China.

You know, they're strengthening in their economy. Our currency is being devalued. Eventually, we might not even be the reserve currency anymore if it continues down this path. And the education system and the way our country is being divided, we're becoming less and less patriotic and we're pointing our fingers. and we're just turning into a country of angry victims, really. And this should cause them some concern for sure, because public sentiment has a lot to do with which way the economy actually goes

if we're going into a recession or if we go into something called stagflation, which is a very scary possibility. Because there are a lot of things right now that are just outside of our control that will be affecting us in the future. Now, we don't have a crystal ball. I wish I did because I'd be making some really good calls right now if I did. But it seems fairly reasonable. to expect or to start planning for, you know, some things that are likely to happen.

And it's going to cause us to or it's got to require us if we want to pull through this to act in a very certain way and take some very specific actions. Because a lot of wealth is built in times like this where everybody is a little bit afraid and there are some very specific things to do. And there's some very specific things not to do. So I think we should be planning for inflation to be sticking around for a little while by all reports I'm saying another year or two. Could be longer, could be shorter.

I think we should plan on the stock market hitting new lows. A lot of the experts are suggesting that. Some people think we're pretty close to there. If you're into cryptocurrency, that's probably going to continue a little bit of a downclined or decline. I don't see anything in the economy right now that's going to bring positive consumer, the retail consumer back into the market anytime soon. I think funding is going to become a little bit more scarce when it comes to real estate. certainly getting more expensive.

So your options are going to be limited, even if it doesn't leave. I think even to the point where hedge funds that have been buying a lot of real estate, I think they're putting the pause on a little bit to see what happens. Consumer behavior is changing. Unemployment, we're already seeing announcements of layoff. I know layoffs. I know Apple is one, I believe. Coinbase was one.

There was another one I was thinking of, but it's happening. And so unemployment is probably going to start increasing. And then what is the housing market going to do? do. That's what we're all really concerned about because that's the industry that we're in. I think it's certainly going to slow down. It's already the sales activity is slowing down for short. Prices haven't really shown any sort of correction yet. It's potential. I don't anticipate a crash, but I, you know, I would be surprised if we pulled back a little bit. And we're certainly going to be starting longer days on market. You're going to see pick your buyers. The mortgage

applications are down and declining. So less and less retail buyers are out there. It's really impacting mostly your first-time homebuyers and your middle class. The wealthy haven't really felt it yet. And then there's definitely signs that they are still buying for buying investment properties to buy second homes, vacation, stuff like that. So basically overall, we need to plan for a recession lasting for potentially a couple years. I need to plan for. So what is there to do inside of that? Well, I got a few things that you're going to want to do and something that we're doing here in our household as well is analyze and look at all of your discretionary spending at the moment and see what to be cut. What can you cut? Some of those luxuries that you've been become accustomed to are they

really essential. So look for there. Look at your consumer debt. Certainly don't want to pile too much more onto that and you would like to probably allocate some funds to start pulling back on that. As the interest rates rise, if you have adjustable credit cards, those payments are going to start increasing too. So you want to start trying attacking those while you can. And then with all that money that you're saving, you're going to start building your cash reserves with what you're to save. But the bigger focus is really going to be on taking a total offensive approach on your income. Because with prices rising, we're kind of in a situation that rising so fast, with inflation rising so fast, we can't save enough fast enough for it to have a real impact.

And sitting still and wait for this thing to blow over could cost some real financial harm to a lot of people. So we've got to really focus on income, whether that's pulling into your job and asking for a raise, whether it's taking on a second job, whether it's taking on a second job, or you go on and take on an asset class or learn a new skill, which is what a lot of people do during the recession is they'll go back to school to increase their skills or to learn new skills. So some of the things that you might want to look at and learning how to flip properties. We're at Epic Real Estate.

This is what we do here. Whether you're flipping properties after you fix them, whether you are flipping them without fixing them, or whether you're just flipping the contracts that you get under your control. You don't learn how to create cash flow. You want to increase income that way with passive income. It might not be enough hours in the day for us all to keep up with inflation. And then ideally you want to learn creative techniques,

creative approaches, creative strategies to learn to do both, to get cash and cash flow out of every property that you come across, every seller that you talk to. And I think right now, potentially, there are some small signs of it happening right now, not nothing blatant, but some small size is that there's going to be a lot of people feeling a lot of pain here in the near future. And that pain is going to be very much could be resolved by finances

and they're not going to have it. And there's going to be a lot of property owners that are going to be turning to their properties for financial relief. And that's where we can come in and give them some peace of mind and get some equity in exchange. And I think right now over the next few years, it could potentially be easier for the first time real estate investor, the brand new real estate investor than it has been for a while. You know, the property price. prices are going up so fast and sellers are used to hearing that and they see it and they feel it. You know, the opportunities for discounts become smaller and smaller and smaller. But I think that that opportunity is going to start shifting in the other direction.

So I want to show you what I went through with the epic legends yesterday during our first session of the legends challenge of what you actually need in your business to thrive, right, to pull through this. So we talked about what the challenge is, and we talked about how it works, and then what the actual success plan is to help everybody get their contract signed within the next 10 days. That's the goal. That's what the whole challenge is about, getting a contract sign the next 10 days. But what your business needs are. So there's several things that you're going to need to your business. I got one, two, three, six of them that I came up with. You got to know why you're in business in the first place.

And that's kind of a little bit of a platitude, I guess. It's kind of commonly noble. But what does that really mean? Or people are like, why am I doing this? Well, I want more money or whatever? may be, but I can't know some different things, but it has to be something for you to really succeed and push through, particularly if you've been struggling with succeeding in real estate or you've been trying to get started and you get a little stuff. You got to, it has to be something

as if your life depends on it. It really does. It has to be that straightforward. It has to be as if what's most important to you depends on it. Because this is what I see frequently that people come into real estate is they start sacrificing what they want right now for what they want most. You know, people get involved in real estate because they want to be wealthy. They want to be financially free. They want to be financially independent. They want to stop working for that, that mean old boss. They want to stop being accountable to the time clock, right? They want to get out the rat race. That's what they want most. When it comes to time to go ahead and do the work, you know, they might opt for a nap because that's what they want right now. Or they might opt to go

learn a little bit more before they actually take the action because they feel like they're lacking the confidence and that's what they want right now is some confidence right now but what really happened what was really got to translate into what you want most is taking action right now and not the nap or not you know i'm going to read a book i'm going to watch this tv show then i'll get to work whatever may be that's a big thing so you got to sacrifice what you want right now for what you want most and so most people that have turned to their families that's going to be the most important thing to them or whatever whatever it is that you love most in life make it about that so you can spend more time with that or you can spend more time doing that. So that's why. Second is, you got to be a

real business. You know, if you treat the real estate like a hobby, it's going to pay you like a hobby. If you treat it like a business, it'll pay you like a business. I would say real estate is probably the lowest paying easy work. That's the highest paying hard work. And anything worthwhile, you've got to work hard for it, right? So if you have to work hard, then you might as well get involved and get started, that's going to pay you the most. And that's why I think real estate is, and that's what I chose it initially.

And it's treated me really well because I treated it like a business. So step one for that was to set up their business, to set up an actual business. And if you don't have an LLC or an entity yet, who knows which one you're actually going to need. I got together with some friends and made some arrangements for you to make it really, really easy and almost free.

You go to freeentity.com, and they'll spend a good 45, minutes with you to go ahead and see what it is you actually need to start running your business like a business okay the next thing you need is a steady flow of leads you know your leads are the fuel that runs the engine of your business if you don't have leads then you're not going to have the opportunity right more leads equal more opportunity and at least the better negotiations which a lot of people don't actually consider because you know you need leads for your business but you don't need any one lead. And a lot of people get focused on that one lead or that one seller.

And they're trying every single angle that they possibly can to go ahead and convert that into a deal. And if you do that, it's really difficult to walk away if you only got that one person. But if you got multiple leads, the more leads you got, the easier it is for you to walk away. And one thing you want to know about when it comes to negotiating and you're afraid to walk away, you've already lost. So leads not only present the more opportunity for you, the more opportunity for you to succeed, it also makes you a better. negotiator. It doesn't make you as desperate. You don't compromise your standards as much. And so when we started off with leads and there's two ways to create them. You can work for them

or you can pay for them. And when I got started, I barely had two nickels to rub together. This was like 15 years ago, 16 years ago now. And I only do how to work for it. So I got my hustle on and if anyone can show you how to do this business for free, it's certainly I, because that's exactly how I did it. But today, oh my God, it's so much easier. You got the means, you've got access to leverage. And so we went through that. And we showed them a few different places to go to. And this is the one I'm actually restarting my business right now is with a cold calling virtual assistant, one that's going to work for me directly. They'll only work for me. And they're going to set out text messages and cold calls. They're going to screen everybody for them for me.

And then they're just going to set me up with appointments. And that just keep on feeding and leads, feeding and leads. And they just keep on calling, calling, calling. So that's over at VAs for real estate.com. I think this is one of the more speedier ways and cost-efficient ways to get leads and opportunities to you to have those appointments and have those goodseller conversations than any other thing out there right now. It's really cost-effective. And then again, some direct mail and stuff like that, some digital stuff and agencies. Next thing that you need where a lot of people underestimate is you need a good conversion process. You know why you're doing this. You've got your business up and running. You're treating it like a real business.

You've got a steady flow leads, but now when those leads come in, you've got to learn how to convert those leads to a contract. So we got the conversion process of the lead to the contract and then the contract to profit. If you get the lead to contract right, the second part contract to profit really, really easy. So we just focus a lot on getting this lead to contract and we kind of took them through the expectations of sellers, the conversion quadrant, how to find cooperative sellers and create easy transactions, show them how, where the actual deal is. We gave them the nine-point seller interview that helps them build rapport. It builds trust.

The seller will have confidence in your competence. And they'll want to work with you. And it'll help you separate the suspects from the prospect. So you'll only spend in your time with those people that really want to work with you right now. And that's even if you know nothing about real estate, you've never done a deal before. And you can have a conversation with a seller and they will think you're an absolute expert just by that little seller interview that we have. And then we go through the quick and dirty analysis and what to do. before the appointment, how to tour the property, whether that's in person, which I always recommend

or how to do it virtually and still lock up the deal. Okay. So we went through that and then went through all the tools and resources. There's a bunch of stuff that you can get, but we went through just the bare minimum and most of it costs nothing. You need the computer or the printer, the phone number or a phone. You need the nine point seller interview. You need your 10 navigator score cars. This is what we're going to keep track, how we're going to keep track of our activities and our results during the 10 days of the challenge. Then we've got to track our leads this way. Then just envelopes and stamps. That's the bare minimum. I gave a bunch of other optional stuff that can really utilize leverage and help them be a lot more efficient and spend a lot less time doing it.

And the last thing you need is you're going to need support because you can have the best system in place. You can have all the resources, but at some point you're going to get stuck, right? There's a lesson in every single real estate transaction. And every time I have a transaction, there'll be something about that transaction that I've never experienced before. And so I go to intern to support. I have. that associates and people that are that are around me. So you need that community around you. So we offer support in a number of ways over the 10-day challenge. One is via video conference calls. We meet every Tuesday, Thursday. We end up for three and a half weeks. And then inside of those calls,

we do the training. And there'll be some education, but it'll be almost all demonstration, because people really learn well when they're actually watching it be done. And that's what I'm doing on this challenge with everybody. And again, if you want to get the details, you just go to the legends challenge.com. And then, Q&A. And I'm there for the Q&A and answer all their questions. We go through total deal analysis with them and we look at their deals and we get them back under the conversations with sellers, teach them how to follow up. And in many cases, I just got off the phone with DeAngelo, a private client of mine. And we called a seller right there while he was on the Zoom call with me.

So if it comes down to that, I'll just make those calls for. All right. So that's the support there. And that's what I really want to focus on. So if your business doesn't have, these things, you know, it's going to be tough to pull through this new economy, this new environment that we're going through right now. So make sure you have those essentials. You got to know why you're doing it. You got to run like a real business. Go get your free entity over at free entity.com. And then you need a steady flow leads. So whether you work for those or you pay for those, it's got to be steady. It's going to create more opportunity for you. It's going to make you a better negotiator. And then you need to know how to convert those leads

into contracts. There's a lot, a lot of deals out there. There's a lot of opportunity out there, contrary to popular belief. But what there's not a lot of, there's not a lot of people that know how to convert. There's not a lot of skilled real estate investors that are skilled in the conversation, skilled and binding solutions for sellers. And if you get that down, then the sky is the limit. You need some minimal tools and resources. Most of that stuff is free. It's how I got started, but there's great resources right now that I've introduced everybody to where you can totally expedite this. So if you're working a full-time job, where you have limited. the number of hours, then that is available for you to.

The official challenge starts on June 30. So we're just doing like three sessions of prep, getting everybody ready to run, and I'm doing it right alongside with everybody, and I would love to have you. All righty. So go to the legends challenge.com and join us tomorrow. You can watch, as soon as you log in, you can go ahead and you can watch yesterday's session, you'd be all caught up and you'd be right caught up to speak with us tomorrow. And if you want to make some money in real estate, and I don't think there's any greater

opportunity or asset class or industry over the next few years, particularly because of the environment that we're in. The greatest hedge against inflation is going to be real estate, because as the value of our dollar decreases, then we need more of those dollars to buy the real estate. So the real estate is going to up and up in a price. And that's one part. So just by the value and the equity of the property is going to hedge you against inflation. And the second part is rents keep on rising. You're up I think 40, was it 43 percent year over a year, nationally, but 43, maybe it's 43% in Vegas was 23% nationally. Either way, it's significantly more than we normally see.

And that's what happens during a time like this. And the supply and demand is so lopsided at the moment with regard to we got more people than we got houses. People think we're in this housing bubble. We're not in a housing bubble. We are in a people bubble, if anything, but I don't think the people are going to pop. So real estate is one of our essential needs and there's enough demand to fulfill whatever's available out there.

And that wraps up the epic show. If you found this episode valuable, who else do you know that might too? There's a really good chance you know someone else who would. And when their name comes to mind, please share it with them. And ask them to click the subscribe button when they get here and I'll take great care of them. God loves you and so do I. Health, peace, blessings, and success to you. I'm Matt Terrio.

Living the dream. Yeah, yeah, we got the cash flow. You didn't know home world. We got the cash flow. This podcast is a part of the C-suite Radio Network. For more top business podcasts, visit C-Slee. c-sweetradio.com