Money Rehab with Nicole Lapin - Ryan Serhant on Investment Properties, Sales Tips and Hand Modeling (Change Maker)

Episode Date: August 26, 2023

Originally aired on 10/1/21 Ryan Serhant, real estate mogul and star of Million Dollar Listing New York, tells Nicole his best advice for making sales and buying houses. Plus, Ryan gives us the scoop on hand-modeling that we didn’t know we needed. This episode has something for everyone: homebuyers, real estate brokers, aspiring salespeople and anyone looking for some inspo on leveling up at work. Want to start investing towards a down payment, but don't know where to start? Go to moneyassistant.com and meet Magnifi, your AI money assistant, designed to help you make a plan for your financial goals. Want one-on-one money coaching from Nicole? Book a meeting with her here: intro.co/moneynewsnetwork 

I love hosting on Airbnb. It's a great way to bring in some extra cash. But I totally get it that it might sound overwhelming to start, or even too complicated, if, say, you want to put your summer home in Maine on Airbnb, but you live full-time in San Francisco and you can't go to Maine every time you need to change sheets for your guests or something like that. If thoughts like these have been holding you back, I have great news for you. Airbnb has launched a co-host network, which is a network of high quality local co-hosts with Airbnb experience that can take care of your home and your guests. Co-hosts can do what you don't have time for, like managing your reservations, messaging your guests, giving support at the property, or even create your listing for you.

I always want to line up a reservation for my house when I'm traveling for work, but sometimes I just don't get around to it because getting ready to travel always feels like a scramble so I don't end up making time to make my house look guest-friendly. I guess that's the best way to put it. But I'm matching with a co-host so I can still make that extra cash while also making it easy on myself.

Find a co-host at Airbnb.com slash host. Hey guys, are you ready for some money rehab? Wall Street has been completely upended by an unlikely player, GameStop. Are you ready for some money rehab? Wasting our time. I will take a check. Like an old school check. You recognize her from anchoring on CNN, CNBC, and Bloomberg. The only financial expert you don't need a dictionary to understand. Nicole Lappin. As you know, here on Money Rehab, we feature changemakers, public figures making change in every sense of the word,

and along the way have been in, or might still be, in money rehab. Today, I'm talking to Ryan Serhant, hand model turned real estate mogul. On Money Rehab, we've talked a lot about best practices around renting versus buying, and how to find a home you love at a price you can afford. I have my own opinions on these topics, as you know, but I was really interested to hear how someone who is so deep in the real estate world would think about these big questions. Of course, Ryan is an expert on selling houses and apartments, which means he is more pro-buying than I am across the board. But if buying is right for you, Ryan has some great advice. Plus, I also want to ask Ryan about what the other side of things is like, selling.

What suggestions does he have for people who work in sales and want to step up their game? Let's find out. Ryan, welcome to Money Rehab. So we start the show with a fun game of Never Have I Ever. Have you played Never Have I Ever? I can. Sure. Yes.

Okay. So unfortunately, we don't have actual cocktails for this or any alcohol, but this is the money version of Never Have I Ever. So if you've done something, say, I have. And if you haven't, just say, I have it. Cool? Yeah. All right. Never Have I Ever.

Split the bill on a first date. I have not. I don't think I've ever done that. Never Have I Ever played the lottery. I have. Never Have I Ever played the lottery. I have. Never have I ever attended business school. Have not. Are you bummed about that?

Nope. No way. Me neither. Never have I ever lost a credit card. Knock on all the wood, but I have not lost a credit card. Good. Never have I ever taken a mental health day. I should in the future, but I have not taken a mental health day. Never have I ever disputed a charge on a credit card. I have. Never have I ever bought a used car. Never. Oh, wait, actually, you know what?

We were going to be in our first fight. Yeah, that's not true. Actually, you know what? We were going to be in our first fight. Yeah, that's not true. My current car right now is a G-Wagon Brabus. And I was not expecting to buy that one when I went. I was just looking at new cars. And that car guy totally sold me. He's like, hey, listen, this guy in New Jersey bought this G-Wagon.

He sent it to Brabus in California. It's the whole package. It's insane. You drive this thing and it sounds like a freaking dinosaur in like a good, crazy way. It's all souped up. He brought it home and his wife made him get rid of it. It has like seven miles on it and now he just needs to sell it. And what do you think?

And I just, I bought it for like half what it would cost me to recreate that car. And so that's that's the car that we have, like the personal car. Never have I ever sold a multimillion dollar house. I have. Lay off. OK, so let's start at the beginning. Lay off. Okay, so let's start at the beginning, how you started doing that. I read that the first day in real estate for you was the day the subprime mortgage industry collapsed in 08. Is that true? That is 100% true. That was day one. I said, I was born in Texas. I grew up outside Boston, really. I lived on Long Island for a little bit, but really kind of my formative year. So,

you know, junior high, high school was outside Boston on the North Shore. And the only thing I was good at or had any interest in was theater. I was terrible at all sports. My parents made me play every single one of them for at least one season so I could get out of my system. They made me take every single class so I could see what I would be good at. I wasn't really great at any of them, but theater was the one thing that like made sense to me for some reason. And so when I graduated college, I went to college in upstate New York and this,

I graduated 2006. I was like, listen, I got a little bit of money saved up from summer work and my grandfather had died and left us all like a little bit of money, but not like a lot. I, you know, I probably had like 20 grand saved. It's like, you know what, I'm going to,

I'm going to take this time that I have where I'm still young, 21, and I'm going to move to New York city and I'm going to try this theater thing and this acting thing, because if I don't do it now, when am I going to do it? Like in 20 years when I have a family and then I have a nervous breakdown that I never did that thing I always wanted to do, I'm going to do that. And so I moved to New York city and wanted to do. I'm going to do that. And so I moved to New York City and I tried it and I got onto a soap opera pretty quickly. It was an Ezra

Returns for a while. And then I quickly got killed off and just had a hard time making money. And so I just tried to do weird, odd jobs to make ends meet. I was hand modeling. I was a lot of hand modeling, actually. Can we stop on that for one moment? Sure. What goes into hand modeling i was a lot of hand modeling actually can we stop on that for one moment sure what goes into hand modeling your hands are gorgeous they're so stunning i i just need a moment to catch my breath so i had a from the soap right i got out of the soap and so i had to get all these head shots done and i had a head shot where i was like this like holding my chin you know holding my face classic model leaf face. And then I got an agent after that because I was like, ah, this is my big brick.

I'm going to Tom Cruise. You better watch out kind of thing. And that never happened. But, you know, the soap ended and he called me. His name is Rich. He's like, hey, I don't know if you want to do this, but there's a casting AT&T. They're looking for a hand model. I was like, what?

No. casting AT&T um they're looking for a hand model I was like what no they're like he said they're gonna pay you 150 bucks an hour guaranteed 10 hours a day for five days it's like wait wait wait that's like it's like six or seven thousand dollars per week to do what like you just have to hold phones and let them take pictures of your hands like um sign me up my rent was 1100 bucks i could live on like 100 bucks a week with food and stuff at that time you know because it was just super cheap and i didn't go out or do anything and i went to this hand modeling audition and you know in midtown just thinking i was going to show up and show my hands and i had no idea there's a there's like this underground hand modeling uh like like union of people who that's what they do they sleep with gloves on they walk around with their hands elevated so that the blood drains out of their hands so they never have veins they have freckles

and little things surgically removed so their hands can look like a man's or a woman's um and it's a big business for a handful of people there's hand models that get flown around the world just for that hand to hold like the new iphone or to hold something and so i don't have any marks on my hands and not a whole lot of veins and um i played piano a lot when i was a little kid and so my fingers are pretty long not like freaky long but i have big hands and my fingers are long and so I went in there and people were all like sitting around like this with their hands up I was like what the fuck where am I and they called me in and they asked me they're like could you please show us your book like a model like you'd have a book of all your different jobs before and I was like I don't have a book of hand jobs I'm sorry

so they took they had me hold a phone and they did move my arm in a bunch of different ways. It was, like, uncomfortable and all that. And they were like, thank you, and I left. And then my agent calls me the next day, and he's like, Ryan, you're not going to believe this. Guido, who is the Italian photographer, right? Guido said your hands are the most fantastic he's ever seen. And he must have your hands in this campaign. And that campaign went on for a year and a half and paid all of my bills. Even when I started real estate, my first year of real estate, I made $9,000,

but it meant nothing to me because I was booking hand job after hand job like i was holding phones for at&t and then like samsung and then uh sorry no at&t it was like singular at the time before they were uh combined um uh it was like sprint nespresso hired me to hold all the nespresso capsules because i could put my fingers really far apart while trying to bend the metatarsal the middle middle finger, just a little bit. I had like a hand masseuse. I wore a Luperderm glove so I would never get calluses or hangnails. Like it was like for me, it paid significant real money. They would fly me around the country.

I know this is not what your podcast is about, but you asked. Oh, there are people who want to know. But I couldn't just, you know, do hand modeling my whole life. I had to do something with my brain. And I basically then, at the end of 2008, kind of just run out of money. And hand modeling wasn't, like, super consistent, you know? Like, it would be every couple months, there'd be a big job, and that would pay for things for a while. And a friend of mine said, listen, you can do all your hand all your, your handy, your handiness, um, on your own time. So many puns, all the puns, but you can't, uh, uh, you

should get your real estate license. It's just like theater, memorize information about buildings and streets and people. It's an improv. You're just going to meet people, get to know them real fast. You show them places that they would see by themselves anyway. And then just ask them which one they want. And then they just take one. And this was the summer of 08 before the world fell apart. And then I got my real estate license, September 15th, 2008, the day Lehman Brothers filed for bankruptcy.

And I only know that because that was my first day. No suit, no nothing. Went into the office that my friend told me to come to. And everyone was around the conference table watching CNBC. And I was like,

I had no idea. I didn't watch Squawk Box. I had no money. I was a hand model. I was a self-popper. I didn't have a financial portfolio. I barely had a checking account. So it didn't mean anything to me other than real estate was real hard. And that's the market that I had to learn in. Yeah. It's like you decided you wanted to be a football player and wanted to practice at the Super Bowl. Hold on to your wallets, boys and girls. Money Rehab will be right back. I love hosting on Airbnb. It's a great way to bring in some extra cash.

But I totally get it that it might sound overwhelming to start or even too complicated if, say, you want to put your summer home in Maine on Airbnb, but you live full time in San Francisco and you can't go to Maine every time you need to change sheets for your guests or something like that. If thoughts like these have been holding you back, I have great news for you. Airbnb has launched a co-host network, which is a network of high quality local co-hosts with Airbnb experience that can take care of your home and your guests. Co-hosts can do what you don't have time for, like managing your reservations, messaging your guests, giving support at the property, or even create your listing for you. I always want to line up a reservation for my house when I'm traveling for work, but sometimes I just don't get around to it because getting ready to travel

always feels like a scramble, so I don't end up making time to make my house look guest-friendly. I guess that's the best way to put it. But I'm matching with a co-host so I can still make that extra cash while also making it easy on myself. Find a co-host at Airbnb.com slash host. Now for some more money rehab. Since then, you built this massive company with, what is it, more than $4 billion in sales and a whole TV franchise around your

then-sav savvy improv theater, everything you learned about real estate. How many streams of income do you have now? I guess we have real estate sales and real estate brokerage and all things that are real estate, physical real estate and the movement of that. We have online education, which is a significant business where we teach people to sell all over the world and help them build their sales careers, help them build personal brands, all that. We have an in-house film production studio that creates content, all real estate, so real estate content for developers, agents, real estate story content, social. Actually, one of our first national television commercials started airing yesterday which is pretty cool for them um i didn't have television um which i guess is a separate income stream um i then have let's say like all the miscellaneous media so like the i like i hard

podcasts you know the the different deals with Facebook, all the licensing deals, all like the random media deals and stuff. And then I would say then there are investments, right? I have investments that have, you know, passive income and real estate investments. I think that's about it. Yeah. Seven-ish, like average millionaire has about seven streams of income. That makes sense. It sounds like the foundation of a lot of them are selling, though. And you had mentioned that you have hired non-real estate people as salespeople because they were so good at it. If folks are listening and they want to sell, whether it's real estate or something else, what do you think is the thing they must know? I mean, there's a lot of things, but I would say if I break it down real simply, first, you have to know your product and you have to know your people.

If you know your product really, really well, but you don't know your people, then who are you going to sell to? And if you just know people, you're good with people, but then you don't know your product, then no one's going to trust you to spend money with you. So the first thing you have to do is you have to really learn the product. So as an example, one of my first sale deals was a woman coming over from China to buy an investment property in New York City for her daughter who was not born yet as an investment. She wanted to spend, and I quote, a couple million. And I had no idea what I was doing. Never done that before, ever. I was only doing little rentals at the time. But I figured, you know what?

All the agents that I see who do deals like that, the only difference between them and me is they just have been doing it a lot longer. And so they just are able to talk way more confidently. They just know a lot more. This woman's coming from China. She doesn't know that I've barely been doing this. I'm just going to know everything.

And just like I did in theater, I'm going to memorize everything I possibly can. That way if she has any question, I'll have an answer, or at least I'll have a significant amount of facts so that she'll never second guess me. And that way I'll never say, um, or never say, I don't know. And it'll make me feel more comfortable with her because I'll know so much. I'll be so confident. And I did that deal, uh, for $2.1 million and paid my rent for the, for two years at the time. Cause my rent was 1100 bucks a month, like I said. Um, and that really, really showed me like, okay, I know how to do this, whether I'm selling something cheap

or something expensive, I got to know my product and I got to find and then know my people. So it's a mixture of learning your stuff, right? Running around, um, understanding what it is you're selling, what you want to sell on top of then going out and trying to find leads, finding people, prospecting. And some of my first people, aside from her, trying to randomly, you know, our initial office in 2008 and 2009 was on 49th and Madison. So we were above a burger heaven. And I would always smell like fries. And so I didn't know anybody. I'm not from here.

I didn't go to school in New York City. And I didn't get into real estate to make it my career. I got into real estate really to pay my bills so I could keep doing like acting and theater and all that. But then I just got kind of addicted to it. But I would find two types of clients or three guys. One is just on the internet, cold leads. The other was if you walked out of Saks Fifth Avenue on 49th or 50th and between Fifth and Madison

with more than two shopping bags, I would profile the shit out of you. And that meant that you could afford a new apartment. And so you should at least have my card. And if you were in the Starbucks of 49th and Madison ever, and you were a woman and you were pregnant, that meant that you probably needed more space. And those were some of my first new clients. You know, if I did that a hundred times, say like six or seven of them actually worked

and turned into clients that I otherwise never would have had. It turned into long-term clients that were just in that moment saying, you know what, we've been totally procrastinating, but yeah, I'm with my husband in a one bedroom and we've got to figure this out but we've just been so busy at work you know it's been always like a lot of that and um and like

it's amazing what you can do by just talking to strangers and if you think about it like your best friend was a stranger at some point and then what you met them in school you met them on the street you met them at a play like you met them somehow and they were total strangers, but you talked because you had something in common. Maybe you were at the same event, same school somewhere. So if you can go up to anyone in the street, compliment them. So you break the ice that way and then find something in common. You can be friends with absolutely anybody. And then people hate being sold, but they love shopping with friends. And so then anyone on the planet can be your client. I love that. And you had these beautiful manicured hands as you

were handing out cards. Who wouldn't want to accept from an award-winning hand model? So I'd love to get your perspective on some common real estate questions that we get asked a lot. And the first one is, if someone asked you how they know whether or not they're ready to buy a house, what are some of the first things you tell them? If they're ready to buy a house and they don't know what house they're looking for, the first thing you have to do is figure out how you're going to pay for it. Do you have all the cash in the bank with enough reserves? Then great, you're a cash buyer. If you don't, like most people, then you're going to get a loan. So before you even go out there and start looking for houses, you probably really have no idea what you can afford.

So you should talk to a banker and a pre-approved lender and figure out what you can afford and get a pre-approval letter. That's going to be incredibly, incredibly, incredibly important. So that's step one. And you can oftentimes find people, like a big part of my job as a real estate agent is meeting with people who know they want to buy something, on your own but this is the lowest inventory market right now in the world not just the united states that we've ever seen if you go at it alone you're basically like going into battle with no armor and no weapons just because you're a cash buyer just because you're not represented does not make you special what it means is that you're by yourself and you're either going to be taken advantage of you're're not going to know what to do, or you're going to bring your father-in-law

who bought a house once in Kansas and he's going to pretend like he knows what to do, but he's just going to screw it up. You want to align yourself with an army. You do that by hiring a real estate agent. As a buyer, you don't have to pay. So don't worry about it. The sell side pays it. And they're either going to pay it to one agent or they're going to pay it to two. And it's just part of the deal. And you want that real estate agent to really help guide you. Because remember, your real estate agent, if they're involved in a transaction and they take a commission from it, they have a fiduciary responsibility to you. So they can't sell you crap.

They can't sell you something that's going to fall down the next day. They want to make sure that you're buying the right thing and a good thing because they don't want to have any liability issues with you. So you want to align yourself then with a great realtor who can really help you figure out where to get financing and where to look. You might think you definitely want to be by the lake. But for what you do and how you live your life and where you want to go in the future and all these other things and taxes and access to the waterline and sewage, all these things that you probably don't think about, you definitely don't want to be by the lake. And they're the ones who have that expert advice. And then from there, it's about finding, I'd say from there, it's a process of elimination, not a process of selection. People can shop themselves to death, but you don't want to do that. You want to figure out exactly what you want,

see a handful of things, and then start eliminating options that don't work for your needs. And then when you're ready to go, because you got that pre-approval, you know exactly what you can afford, you're ready to pull the trigger and jump on the first option that you love. Hold on to your wallets, boys and girls. Money Rehab will be right back. Now for some more Money Rehab. And you said that this is the lowest inventory in the United States and in the world. So would you still say it's a good time to buy for folks in the market? Yeah. I mean, at the same time, it's also probably the worst time to be a renter because there is nothing to rent. If you're in New York City, good luck.

I've got clients right now that are looking for a house in Brooklyn zero never in my entire career have there been zero options where like the system comes up and says sorry nothing found it's never happened to me in the 13 years I've been doing this and it is happening right now. Like it's crazy because everyone is focusing on the temporary. They're nervous. And so they're just renting. Okay. So it's not a great time to be a renter. That is for sure. And the buy side, you have to remember you're not buying today, right? You're buying for the future. Unless you're an investor and you're just looking for the deal because you're going to try to flip it. You know, you are incentivized to buy something for where the marketplace is going to be in the next five to 10 years. And so I do still think it's a great time to buy, in part because the

market's so great. I think, guess what? If you hate it, you can sell it tomorrow. There's enough people out there. If people are looking to invest in real estate, would you not just recommend having your own home, but buying investment properties or even investing in REITs? Sure. REITs or kind of general real estate index funds can be a very safe way or safer, I'll say, and diversified way to, you know, put passive income that you've made to work in the real estate space. You can also buy investment properties. You can Airbnb them. There's a lot of people who do that. The small kind of fixer uppers, they fix them up and then they rent them for a significant amount of money. It's amazing what you can do in the short term market. You can't do it in a lot of

cities. Like you can't do short term Airbnbs in New York City because it takes away from hotels and New York City makes way too much money from hotel tax to ever allow us to do that. But I'm a big fan of real estate investments, obviously. You just want to make sure that you're not biting off more than you can chew. If it's purely for investment, look under the bar. It doesn't need to be the greatest property ever. It needs to be something that's got value add, maybe in an area that is gentrifying or changing where, oh, there's a huge grocery store coming up just a couple minutes away. Eventually this area will be worth more because areas around grocery stores end up being very expensive because people want easy access to food. Things like that are what you should think about. But I'm also a big, you know, multifamily in the South,

multifamily in the Midwest. You know, they can pay some really great caps. And then you can also look at, you know, AAA net leases, commercial properties. There's a lot of different options out there. And I think the real estate market will be pretty good for a while now. I think we've had a tough real estate market for

12 years. So it's about time people like buying and selling real estate again. What do you think about looking at foreclosed homes? Would you advise against that because you don't see a lot of those bigger issues? No, I'm all for foreclosed homes and short sales. If you can find good deals anywhere, those are great, great opportunities. And it's oftentimes not has nothing to do with the house, it's everything to do with the current owner and borrower. And they just can't keep up with the payments. And so all the bank's looking to do then

is just recoup their investment. So you're going to buy it. You're basically just buying the note with no premium attached, unless it's a really hot market. And then you go to those auctions and then you just blow up through the roof. What's the piece of advice

you would give your former self for finances? Scared money don't make money. Tell me more. Meaning, like, it's nice to have savings and to look at that bank account every day and to pull up Mint and see, you know, what you got going. And it's fine. But if it's not working for you, then it's dead money. And guess what? It's working for someone else. Like if you have a hundred thousand dollars in the bank, it's not sitting in some like vault waiting for you. I wasn't imagining it like that.

It's not like that, right? It's a number in the computer. It doesn't exist anywhere. You're only FDIC insured up to a hundred grand. Okay. And that money that you've given in that's sitting there is being used by someone else. The bank, the bank has used it to lend out to somebody else buying their investment property. So have your savings ready to go. But if you're young, you're under 30, um, 35, right? You scared money doesn't make money. You want to invest. You want to put your money to work. You want to be smart. Don't be stupid. You want to be smart about your investments and it's

okay to save, but you should invest back into yourself. Like that's in my position. That's what I should have done sooner than when I learned it.. For today's tip, you can take straight to the bank. If you're thinking about an investment property, make sure you're looking at a neighborhood where there are concrete signs that the value and desirability of the area is going up. In our interview, Ryan mentions how neighborhoods with new grocery stores typically signal

that property prices will increase in the near future. Same goes with neighborhoods that have announced new schools or public transportation stops. With investment properties, just like stock investments, you want to make sure that there's growth so you get that sweet ROI. Money Rehab is a production of iHeartRadio. I'm your host, Nicole Lappin. Our producers are Morgan Lavoie and Mike Coscarelli. Executive producers are Nikki Etor and Will Pearson.

Our mascots are Penny and Mimsy. Huge thanks to OG Money Rehab team, Michelle Lanz for her development work, Catherine Law for her production and writing magic, and Brandon Dickert for his editing, engineering, and sound design. And as always, thanks to you for finally investing in yourself so that you can get it together and get it all.