Jobless to 25 Units in 5 Years (My Exact Strategy)

You DON’T need a huge network, online presence, or social media following to invest in real estateToday we brought on another rookie investor to share their experience and share their story of getting started in real estate investing. It’s also a great episode to watch. If you’re thinking of pivoting or changing your strategy, we’ll break it down with Jared as to what you should think about and why he decided to do that.And this episode’s also about hustle. If you want to learn unique ways to find off market deals, to find partners, to build your brand without doing social media, without being a podcast host, this is the episode for youToday, we’re bringing on Jared Hodel. So welcome to the Real Estate Rookie podcast. I’m Ashley Care.And I’m Tony j Robinson. And Jared, super happy to have you on the show. Thank you for joining us on the Rookie Podcast. Yeah, thanks for havingMe.Jared. Let’s start off with life before real estate. What were you doing and how did you come upon real estate investing?I’ve always wanted to be a football coach, so I was a college football coach working my way up through some of the smaller schools. And so I was in Madison, South Dakota at Dakota State University and then went up to University of Minnesota, Crookston always on the offensive side, working with quarterbacks, receivers, and it was a ton of fun. 2019 Crookston, university of Minnesota, Crookston decided to drop football. So I’m originally from Waterloo, Iowa, and I moved back home in late 2019. And of course everybody knows what happens in 2020, so I was looking for a job, no one was hiring. And I actually went to a wedding of my cousin and my other cousin was like, oh man, you got to listen to this podcast. It’s about real estate investing. And so he introduced me to BiggerPockets at that time and started just listening and listening.
I loved the Jocko Willink was like my guys, when he was on the BiggerPockets podcast, I listened to that episode. I’m like, okay, this is something good here. So kind of the whole time, I was just looking for purpose, looking for a why, seeing what skills I had as a football coach and what could be transferable maybe in a different career. I grew up helping my grandpa. He had about, I dunno, 15 properties probably. So I was always making extra cash with him and Waterloo here painting or mowing or doing snow removal. So I always had been around rentals, been around tenants, watched his processes. And so it all came together when I was listening to BiggerPockets and thinking about being a football coach. And what we did with recruiting is kind like sales, putting yourself out there. And I think someone mentioned driving for dollars and obviously I knew Waterloo and had a lot of time on my hands, so just started driving around looking for some places.Jared, everyone’s going to think you’re a paid sponsor with all those bigger pockets. So Jared, you’ve got your mindset on real estate investing and you said you’re out driving for dollars, doing different things to get that first deal. What about financially? Was there anything you were doing to get your house in order to get that first deal, or did you even know how you were going to fund it?I think luckily I’ve always been a frugal person. So along the way, obviously as you would imagine, college football coaches don’t get paid a ton of money. So you’re kind of needing to budget along the way and save more than you spend. And so I luckily had those principles already had some money saved up, but to that point, it’s like, yeah, how do you get a loan without a job? And so that was definitely difficult at that time. And especially at that time, I also started getting into real estate sales, which obviously is difficult to, you don’t have a W2 income, so you’re not going the conventional route. But for the first couple I had 20% saved up. And so it kind of worked out just because I had someone willing to take a chance on me with underwriting the deal and seeing that I’ve just started a new career and had the money down. SoJared, it sounds like as you were searching for that next career phase, you became an agent.Yeah, so I think early on, driving for dollars, looking for deals, it just spoke to me the real estate investing and how little there are people out there aside from places like BiggerPockets or forums where you can ask questions, there’s not a ton of local people in a lot of communities that know what’s going on real estate investing wise, but also willing to help other people along the way. So I kind of saw an opportunity with that, pairing that with my background being a teacher and a coach and recruiting. And so it just kind of ended up being a perfect fit. But certainly getting those first two deals showed me like, oh, this might be something here where I can help other people as well. Yep.Talk about a great networking opportunity for you to meet other investors by wanting to be the go-to agent to help them get a deal.Obviously Waterloo where I live, pretty small market, but one thing that I always think about that is I got to start the real estate meetup here in our town. No one was doing it before. So it’s like some of those other frontiers had already been conquered the bigger cities, but when you get in a smaller regional spot, it’s like, man, you could be a little bit late to the party and still kind of be the guy doing the stuff. But absolutely, it’s been fantastic networking and meeting people and watching other people grow alongside me and doing their thing as well. So that’s been awesome.And Jared, I want to go back to the driving for dollars and how that led to your first deal, but I feel like we need to pause on the meetup here just for a moment because I think when a lot of rookies talk to themselves about building their network, building their brand, they think about social media and they think about becoming a podcast host. They think about trying to go viral on social media, they think about the digital age and what it means to build your brand and build your presence there. But being a podcast host isn’t for everyone. Being a TikTok dancing star isn’t for everyone. But the local meetups I think are one of those untapped ways that a Ricky with Zero experience can still go out there and build a name for themselves, build their network. So you said that you were fortunate enough to build or start the first meetup in your area. What has been the impact of starting that local meetup on your life and on your business?I’ve been saying that nonstop. I mean, ai, it’s a tool. It’s helpful. Everybody has got this new way of getting a deal and new list that no one else has gotten. And at the end of the day, it’s a contact sport, it’s pounding the pavement, it’s turning over stones. And I think it kind of exciting to me because the more AI solutions that come out, the more people can pound the pavement and make a difference. So it’s like you’re sabbat on with that. I mean, it’s like if you can have the meetup and you can have the physical thing, but we’re still humans and we still want to talk to locals in our area, we still want to talk to humans. And so I’ve always been a believer in that. I mean, especially if you can be an honest person and follow up when you say you’re going to follow up, it’s just striking how many opportunities there are out there for those people.
But certainly the meetup for me, I think every once in a while it was being run before I started it, it would be, I dunno, there wasn’t really a cadence to it. So when there’s no cadence, it’s kind of the kiss of death to me, then no one knows when the next one’s going to be. So I just said, me and a buddy who’s a banker in town, I told ’em we’re just going to do it and if it ends up just being me and you, then it’s just going to be me, but we’re going to throw it out to people and we’re going to do some programming. And I could go through my list in real estate sales, but I would imagine 30% of my sales have come from some connection there. And certainly helping people out there, inviting my clients there, but also people showing up that said, Hey, so-and-so was talking, they said I needed to come meet you because you know how to do real estate sales. So it’s been awesome.Jared, I think the key of what you said was, Hey, we’re going to throw this thing and even if it’s just me and you, who cares? And I think there’s that teenage person inside of each of us. It’s like, what if I throw this party and nobody shows up? But like you said, it’s like the worst is going to happen is that it’s just you and your good friend having a beer, and then you guys just talk about real estate. So I think more rookies who are listening should start local meetups because I think it’s the easiest way to start building that network. So thank you for sharing that, Jared. But now going back to the driving for dollars, how long did it actually take? How much driving do you think you had to do before you found that first deal?Well, luckily I grew up in Waterloo, so I knew the areas that I would invest. And it’s funny, my mom’s got two rentals and I was still looking at being a football coach. And so I sat down with her and I said, if I end up getting a spot, a duplex, whatever, and I get another job and move away, will you manage it for me? And she’s like, I will, but I am not going here, here, here, and here. So it became easy to look at the spots that I could invest. And I think obviously not everybody has a mom that’s going to do it for you, but I think that’s a great conversation to have with a property manager is okay, I want to own a property where you’re willing to manage and then kind of reverse engineer that and lead that to where you can drive for dollars. And I don’t know how other states are set up. We have Beacon Schneider is our tax assessor website. And so I call it driving for dollars, but a lot of times it’s a virtual driving for dollars just going down the tax list and streets that way and seeing who owns what. And certainly if there’s a property in there that looks good, I’ll drive by and make sure that it’s the one that would be worth calling on.Jared, give us just a quick breakdown. What are you looking for as you’re going through the county’s website on this tax list?Initially I didn’t really have a great plan. It’s been refined over the years at this point. I love the fifties and newer single family homes now is kind of my bread and butter. I think the 1950s brought a lot of things, modern foundations and at least eight foot in the basement. Modern wiring typically, typically does not asbestos, siding or insulation. So that’s kind of just where I start. And then all different ways to look. Is it vacant? Is the lawn getting long? Talking to a neighbor who might be out, I mean just getting ready to close on one that was a Facebook marketplace. So I mean it’s like just kind of looking at all these different little tiny avenues that aren’t going to be the greatest honey hole, but when you get the sum of the parts together, you’re going to have some good, I guess yield from it.Another great thing to look at too on those tack records is the actual mailing address for the taxes. And if the owner is out of state, maybe more motivated to sell to or doesn’t live at that property, maybe it’s a rental or they want to get rid of it. So that’s another great indicator, but that’s just such an old school way in nowadays to go and look. But you can get so much free information. So if you are a rookie investor and you don’t want to pay for all these expensive different programs and softwares to actually go and find a deal, sit down and go through the tax rules before we get into five ways that rookie investors can get 5% interest rates. Let’s hear a word from our show sponsor. When I bought my first rental, I actually thought collecting rent would be the hardest part.
I was completely wrong. The admin never stops expenses, receipts, tax forms, tenant issues. I didn’t expect the behind the scenes work to take up so much of my time and Headspace every night was another round of paperwork. And I started thinking if it’s like this with one, how do people handle five or 10? That’s where Base Lane comes in. Base Lane helped me get out of the weeds. It’s the official banking platform of BiggerPockets and it handles the whole backend for fence tracking, financial reporting, rent collection, even tenant screening. It’s the first time I’ve felt in control and now that I’m not drowning in admin, I finally see how my real estate business can scale. If you’re starting out, do yourself a favor, sign [email protected] slash BP today and you’ll get a $100 bonus. Okay, welcome back from our short break. We are here with Jared and we’re going to go over the numbers on his very first deal. So Jared, how did you find this deal and what was the asking price on this property and did you do any negotiation to get to a purchase price?It’s funny, I got two duplexes about back to back right in the same week. It’s always funny when it rains, it pours. It seems both good and bad, but one of the deals that I wanted to take you guys through was a duplex fairly close to the house. I grew up south of town in Waterloo. I think it’s the best area in Waterloo at the time. I did too. And there’s about three duplexes built right next to each other. So I called on all of ’em and didn’t hear anything for months and all of a sudden I got a call one month and the guy said, well, I got a call from you, are you actually interested in buying it? I’m getting older and want to sell it. And I said,Yep. I just want to add something there too because you said that you called on it for months and I think that’s the part that Ricks are going to just kind of gloss over, but it’s not like you called this person the very first time they picked up and said, Hey, can I sell you my house at a really great deal? It took time of building that relationship, so I just wanted to make sure that we pointed that out. So please continueA hundred percent. And even at that point he still was like, I got two people that are also interested, so I got to call them too. And it’s like, okay, there’s never a done deal even when they call, but it gets you excited. Of course. So ended up going through the property, it looked exactly like I thought it would. It’s funny I didn’t do an inspection. I don’t necessarily recommend that. I think this was built in the fifties, so I think I got bailed out a little bit because the few things that I’ve had to do have been fairly simple repairs just with the way the house is laid out. But I think one of the funniest things about it is he is like, my assessment just went up, my tax assessment just went up. He is like, I think it’s probably what the is worth.
So if you paid me that, I’d be happy. So now it looks like I paid a random number. Everybody’s like, how’d you get that number? It’s like, I don’t know, I just assessed at that at the time and I thought it was pretty close, but I think it was about $131,000 and he had tenants in there both paying 600. And so the funny thing about that is what does everybody say? Well, that’s not the 1% rule, but I knew the area well enough. I knew his rents were low. I knew I was going to put, I think I put 25% down on that. So I knew I was going to be okay and I could work rents up and I knew it was going to be a great deal down the road. So that’s what I always tell investors too when I’m helping them out is the 1% rule is a rule. It’s not like an end all be all. So make sure it makes sense for the area and kind of what you’re trying to accomplish. If the area is better than that and you think you can get rents up, I think it’s just a blip on the radar if you’re paying a little bit less rent when you first get it. SoWith this deal, did the seller ask for any pre-approval or to see that you could actually close on the deal at all? And did you end up using agents or you guys just did it yourself?Yeah, he did not, which is kind of wild to think back about that. But no, we did not use agents. I wasn’t licensed at the time. He did not have an agent. I used my friend who just started as an attorney here in town, he drafted up the purchase agreement, which has been really cool adding him to part of your story, it’s always fun when you can work with some of your friends on different pieces and it kind of connects you guys even more. So that was cool and there was an appraisal and all that, but of course getting it with tenants was also a little bit of a learning curve for me. It was my first property. I didn’t know, you hear people talk about the estoppel agreements and stuff like that and I’m like, ah, should I do that? Should I not?Now you have to explain what an estoppel agreement is and then we’ll have Tony spell it how he learned how to spell it.I’m just happy I can say it at least close to being right. But when you talk to an attorney, a lot of them, and that’s what I really I appreciate about my attorney is, I mean there’s the legal jargon and then there’s also the kind of the common sense approach I guess you could say. And so the estoppel agreement, essentially the way I understand it is you’re basically asking the tenant, here’s what I have that you signed. Do you agree with this being what you signed? Sometimes they try to pull a fast one or sometimes the landlords pull in a fast one and it’s not exactly what the lease says or there’s been some side agreement along the way that you got to iron out. But for me, I just felt like I did not have them do it. I didn’t want to take that initial approach kind of coming out guns a blaze, and I thought any potential issues that would pop up would be shortlived just because, I mean in Iowa you don’t really sign it longer than a year lease and your rents were already low. So I mean it wasn’t like it could get much worse that way either. SoWell, we actually do have an estoppel agreement. It’s at biggerpockets.com/estoppel and I literally just created it two days ago and it got uploaded to the resource hub. So perfect timing, Jared to mention that. So if anybody needs a copy, I’m an stoppel agreement, we’ve got one at biggerpockets.com/estoppel.Jared, I’d love to hear a little bit more about the deal and what happens next. So you find it, you negotiate, you get it under contract now tenants are already in place. So on day one of closing, is there any action that you need to take? Are you planning on doing rehab and kind of shifting the tenants around? What’s your action on day one of getting the keysThe best way, plans of mice and men go awry? I feel like that was my situation on this studying BiggerPockets and just having this elaborate plan and then you get closer to the day and you’re like, oh man, what am I going to do? So the first thing I knew I wanted to do was, I don’t want to accept checks or cash. You have to walk by and pick up checks or anything like that. So I sent a letter saying, we’re going to set you up on apartments.com, I believe I used at that time, and you can pay on there. And luckily the tenants are pretty tech savvy, so it wasn’t, well one of ’em signed up right away. The other one must’ve been doing bill pay out of his bank account because the old landlord would bring me a check for about two or three months saying, oh, here’s this check, here’s this check.
So I got lucky that the guy was just a great guy and was willing to help me out that he was handing his money over, but obviously the utilities were in their name. But in our area, you can make a landlord account where if the utilities were to switch for some reason or they weren’t going to pay the utilities for some reason, it would just go default back into the landlord’s name. So the power stayed on versus cutting the power off and potentially having an issue with frozen pipes or something like that. So I got the landlord account set up fairly early on and lawn mowing, I bought it right in the middle of the summer, so I had to get lawn mowing set up and then for me it was just a welcome letter sent right to ’em saying Here’s the number to call if you have issues, I’m the new owner. And then just kind of waiting out the leases. And I think there’s a little bit of a give and take with leases, I think if you hit ’em right, I know some other people have probably better strategies than I do on this, but I didn’t feel like hitting ’em right away with 20, 30, 40% increase was right. So we worked out a plan to get there over a couple years and have done that.Much like you, a lot of investors don’t want to necessarily jump in and increase rents tremendously right away because sometimes you end up losing good tenants and that cost of turnover could be more than the incremental increase in rent. But we’ve interviewed Dion McNeely a few times on the Real estate rookie podcast. If you guys just search Dion’s name on bigger podcast and show find the episode. But he has what’s called the binder method where he basically makes a presentation to the tenants and gets them to explain why they feel a certain rent increase is either fair or not fair. And he’s used it to pretty good success. And Dion will actually also be speaking at BP Con this year. So if you guys want to see him live on stage, which I think will be fantastic for the Ricky audience, head over to biggerpockets.com/conference. You guys can check it out there in sunny Las Vegas. So let’s get back to the numbers on the deal though, Jared. So you have these sentence in place, you start to stabilize a little bit, make some improvements around the management side. You said the rents were initially 600. What were you actually able to charge after those increases and what was your net cashflow?I got lucky. I got a 30 year fixed mortgage right in the heat of COVID and it was fixed at 3% for 30 years. And so my payment is virtually nothing. I would say, I don’t know, 900 bucks or something like that, all taxes and insurance included. So that’s been fantastic and allowed me a little bit of a runway to work on getting rents up and doing some improvements over there. Certainly the downside is if you ever have to recapitalize it, it’s like the banks are going to be very excited to get that off their books. So trying to just roll with that as long as I can. But rents were initially 600. I think the one had just signed a lease and one lease was due in January, so I knew the January lease I’d have a little bit of leverage with, because no one likes to move in the middle of Iowa in January, so I think I worked her to up to seven 50 in January.
She ended up staying a couple more years and then actually bought a house. So that was exciting to see. And then I was able to move rents to market. I believe they’re at eight 50 now, so that’s kind of that side. And then the other side has been a same person and just slowly every year just adding a little bit and add a little bit. And that one is up to eight 50 as well. So yeah, I think that’s cashflow or not cashflow and that’s grossing 1700 and I like to set a little bit aside for maintenance and things like that. So I like to say it’s cash flowing about Target is 300 a month and just not that I’m using that money for anything, just kind of rolling it all into an account using it to buy or improve other properties. And I learned last year especially, it’s like if you take care of your properties, they’ll take care of you.
So I don’t want to sap everything out and have nothing for a big capital expenditure. It’s great to leave money in there and then it’s just a minor annoyance when you have to do a roof. It’s not a catastrophic situation if you’re doing a furnace or a roof or an air conditioner or have an eviction or whatever. So that’s been great for me. And obviously everybody’s got a different plan, but I love helping people with real estate sales, so I don’t necessarily need the money with the investments right now, and that’s just a blessing to me. SoI think we’re seeing more and more common, especially now as deals get harder is where people aren’t rushing to quit their job and get full time into real estate, but actually using their W2 or their other traditional income to fund their deals and to continue and grow and to build long-term wealth instead of quitting and finding out they actually need to work harder and longer than when they did at their job too. So I’m seeing just going into the BiggerPockets forums and different things on Instagram seems to be that is more of a growing trend where people are becoming more patient to actually quit their job and to stick with it instead of just going full-time real estate.I kind of have a little bit of a hot take on that. I think it’s what we do as humans, it’s what we’re leaving to the rest of the world and I think it’s a little bit selfish to say, I’m just going to have 10 rentals and go coast off into the sunset, I think. And obviously a lot of investors go and do great things after they leave their W2, but sometimes it’s like, I mean the hard things that we have to do as a real estate sales in your W2 doing your own business or whatever, it’s like those are so important to your community and to your life and to your purpose and to your legacy that I think it’s like I feel like don’t be in a hurry to get rid of those kind of what matters in life.Jared, since you got that first property under contract, what does your portfolio look like today?I bought two duplexes basically back to back right around that time. The other one was fully vacant, so vacant in September and October. That was always a shocker trying to get that filled. And then I bought personal residence that I kind of house hacked with a roommate. And then that’s when I met a couple business partners right about January, February, and it kind of exploded after that. We got more into doing the burrs strategy, single family rentals. I became a little bit more bankable, so it became an option for us to do that and did a couple flips and use that money to just recycle into single families and a couple smaller multifamily and recently a couple smaller commercial buildings, which I’m pretty excited about. But right now portfolio is sitting about 25 doors, I would say, and some storage units. So that’s been kind of exciting growth for us. But yeah, obviously using the bur method, as long as you have some reserves and you’re doing stuff, I think it obviously still works and still is a great way to grow.Yeah. Jared, first congratulations on, I think a lot of success in a relatively short period of time, but two things you mentioned, right? You mentioned partnerships and you mentioned Burr, and I think both of those are strategies that Ricky’s should at least consider. Let’s talk about the Burr strategy first. So I guess first, for folks that maybe aren’t familiar with that phrase, can you break down exactly what bur means?Buy, rehab, rent, refinance I think is what it stands for, but I mean in practice it’s finding a house that needs some love and needs some work or a duplex or whatever, and fixing it up. Talking to a bank that’s willing to do either a cash out refinance or a cross collateralization or something where you can realize some of your sweat equity, rent it out, hopefully you’re renting it out for less than what your debt service would be and just trying to rinse and repeat it and doing it over and over again. Right now it’s difficult, but I think as long as you’re having a little bit at the end of each month, you’re going to be doing okay when rates somedayWill come down hopefully. So I don’t know. I’mHappy when there’s some discourse in real estate. Great. I love it. It makes some of the people that are just kind of half in, half out get out and more deals for us. So I’d be happy for rates to stay high, two more years, three more years. It doesn’t matter to me. SoOnce it goes down though, I’ll be feeling, it’s funny you mentioned that, Ashley, aboutWhen will rates drop? And it’s hard for us to know when, but I think the impact when they do drop is something that we can all agree on. I was talking to my lender a couple of weeks ago and he said that when rates dip below 6%, so we’re sevens ish right now, so a point in some change lower, but he said once rates drop below 6%, there’s an estimated three to 4 million people who will then be able to start buying homes again. And we’re already in a very supply constrained environment and imagine what happens when we add in another three or 4 million potential buyers into that pool. And I think he was even more so talking about people just shopping for primary residences. So think about what happens when you expand that out to folks like us who are real estate investors, what does that look like?
So I couldn’t agree more, Jared, that I think there is a very unique opportunity real estate investors right now today to have more leverage when looking to purchase properties. You can ask for things like, let’s negotiate on the price. You can ask for things like, can I get a seller credit? So I think we are in a very unique space, so I appreciate you sharing that. But I want to go back to the birth though, right? I agree with you that I think there’s some headwinds for that strategy today, but when you talk about building long-term wealth, when you talk about what does your portfolio look like five, 10 years from now, I still think it’s one of the best tools to build with that portfolio. But the challenge right now I think is in a few of those letters within that acronym. The first one being the buy finding good deals has gotten, I think harder today for a multitude of reasons. So what are you seeing as the best way to find good deals today?Brandon Turner’s always says it best. It’s the large funnel I think is important, multiple different avenues of ways to get deals. I think another thing he says is run to hard, I’ll try to make this a short story, but one example that we’re doing this summer is the food bank in town approached us. They’re expanding and they had two houses that would have to be torn down, and so they wanted to see if anybody would move ’em. And so we’re moving them to moving the houses. So not a lot of people can do something like that or have the capacity or the willingness. And so I am like, well, let’s try to take it down. So we’re moving ’em across town to some city owned lots. And obviously there’s a lot of work and a lot of question marks that come with it, but we’re expecting to have a perfect burr on both of ’emBy the end of the process. That’s a great question. And youListen to a lot of people out there that are, once they get into one strategy, they’re very good at it and they’re, I would say, disciplined enough to stay in it. I might not have that discipline. I get a little bit of shiny object syndrome and want to do other stuff. I’ve convinced myself that my strategy is Waterloo and Cedar Valley specific, that I know this area better than anybody. And so that’s kind of my competitive advantage. But certainly the self-storage fits in with that, knowing the area, obviously running numbers just like you run on anything else, making sure your debt service is going to be covered. And just someone I know in town was building them and going to be wanting to sell ’em and gave us a price and we’re like, that’s not too bad. So that’s kind of how that route went.
And in the course of that, the neighbor also had some self-storage and he’s like, oh, I’d sell you this. And we worked out a number there. So obviously it’s always terrifying. You want to make sure that your numbers make sense, but I think it’s important to stretch yourself a little bit every day and learn a little bit more. I’ve been down trying to get the Google to acknowledge me as the owner, so it’s like you’re sitting down on a live chat with Google at the middle of downtown Waterloo. It’s stuff you never expected you’d be doing, butThat’s part of the fun too. So yeah, I mean, it’sNew for me, so I’m trying to hold out judgment. I would say at this point, I’m not, just the day to day of it is a little bit more difficult. I mean, you got 52 people that are obviously there. It’s not their home, but it’s still something that they have and something that they care about. So you’re still fielding calls, still talking to people who, I can’t pay rent this month, it’ll have to be twice next month. And working out the deals that you have to work out, that’s difficult. Not a lot of people doing it, I guess in town. So there’s been a little bit of a learning curve on what a lease agreement looks like and what the process is if they’re not paying. And so we’ve been having a little bit of learning curve that way. I certainly think it goes well with someone like me who’s kind of connected in the real estate world, connected with property managers. Seems like you have a great built-in clientele that way. Just marketing to other managers in town, your own rentals, stuff like that. And of course Amazon and stuff like that. I just think people want stuff. People are always going to have stuff. And so I just feel like bullish overall on storage for sure. SoJared, one last thing I want to pick your brain about here before we let you go is the partnership side as well. You said that was a kind of key moment in your investing journey that allowed you to scale a little bit more aggressively. What was the deciding factor to make you say partnering up with someone else actually does make sense? For me,Again, I just am blessed and got lucky because it just made sense at the time and I probably took it a lot lighter than I should have if I would’ve thought back. And nothing has gone bad. It’s been great, but I’ve seen other ones go bad just from people that I’ve helped. And I think it is like a marriage, as weird as that sounds, I think you’re with them until death to you. And I think you always want to be giving 51%. If both sides feel like they’re always giving 51%, you’re going to be in good shape. One of my partnerships, the sum of the parts is worth way more than us individually. We can run interference for each other and have different skill sets. I’m probably the guy out pounding the pavement, seeing deals, finding stuff a little bit more. He is way better at operations and getting some of the bur stuff done and working with the city and things like that.
And then my other one is the same thing. He’s way better at doing construction stuff and management, and I’m better at finding deals and doing that way. I think we’re financially conservative, not spending, you don’t need all the cashflow from it. I think that’s an important part of your partnership. If one side’s thinking that they’re going to need to use it for income and the other side’s thinking it’s a long-term investment, I think you’re going to have some major issues at some point with that. But if both sides are making good money in their W twos or whatever else they’re doing and it’s just kind of part of their investment portfolio, I think you can make some serious money and investments with a great partner.And for the rookies that are listening, you may or may not know, but Ashley and I actually co-authored a book on real estate partnerships called Real Estate Partnerships. If you guys set over to biggerpockets.com/partnerships, you can pick up a copy of the book there. But Jared, for you, it sounds like naturally each of you had your own skillset that you leaned into. But I still think that the biggest question that Ash and I probably get when it comes to partnerships is how do we structure the partnership? How do we divvy up the profits? How do we divvy up the cash where we put in? How do we divvy up the ownership in this partnership? So what did that conversation look like for the three of youTo that point, and not everybody’s going to have this opportunity, but if you can start off with just a quick in and out a flip is what comes to my mind, or just one rental where you don’t have to have all that stuff hammered out with an attorney right away. Maybe you set up an entity just to have one, but if it’s something that you can see if you can work well together, and if you can’t, it’s no harm, no foul. We’ll separate this sometimes as the same with an individual getting into real estate investing. It’s always the what insurance should I have? What LC? Should I set up an LLC, should I not? What this should I do? And it’s like none of that really matters until you’re really going. Obviously you want to try to do it right, but I think that’s such a barrier to a lot of people. So I would argue just start small and kind of, if you have a friend that’s an attorney that can be a great resource to get an idea how to set stuff up. And if you don’t do it right the first time, but you just have a small deal or one house or whatever, can fix all that down the road. But you don’t want to spend a bunch of money and time and mental energy on something and then you never end upBuying something either. So pretty active on LinkedIn.Jared Hoddle pretty, I do have a TikTok. It’s pretty fun I think. I don’t know what it is actually. Jared Hoddle, CRE or something like that. You’ll find me. I’m on BiggerPockets pretty fairly active on there. So just reach out, would love to chat withPeople and help anybody that I can.