2025 Investing Update: Rates, Recession Risks, and Rookie Advantages

Have you seen the headlines lately? If so, you might be tempted to pump the brakes on real estate investingEverywhere you look, the headlines are saying the economy is slowing down, jobs are cooling, consumers are cutting back and investors are getting nervous. And for a lot of rookies that creates a big question, should I put my money on the sidelines and wait it out?But here’s the crazy part. Some of the best opportunities in real estate actually happen when the economy looks weak. Today we’re going to break down why a slowdown can be your green light to invest more aggressively, how to protect yourself from risk, and the exact strategies Ricky’s can use to come out ahead.If you’ve been wondering whether now is the time to buy or pause, this is the episode for you. Welcome to the Real Estate Rookie podcast. I am Ashley Kehr. I’mTony j Robinson. And with that, let’s get into today’s episode.So the first thing I want to look at is why does the economy actually look weak right now? So first of all, there’s rising unemployment. We’re seeing that across the nation. There’s also softer GDP growth and consumer spending has cooled. People have gone through all of their stimulus money and now they’re realizing that they need to cut back on spending. So these are factors that can come into play no matter what strategy you’re doing. So long-term rentals, this could mean that if you have very high end luxury rentals, if consumer spending is cooling and people are fearful of losing their job, getting laid off, that they may not pay for that high-end luxury apartment just to have that little bit sense of security or they just can’t afford it anymore. Tony, on the short-term rental side, are you seeing the economy have an impact on short-term rentals?I think the, I’ll talk at a macro level and I’ll talk more about my specific portfolio. At a macro level, I think there are a few headwinds that we’ve seen. Number one is, yeah, just discretionary spend is down. I think part of that is a, folks here in the United States we’re seeing more credit card debt. So if you look at the trend of credit card debt, it’s definitely increased post COVID. Whereas immediately coming out of COVID, we were, I think near historic lows in terms of how much credit card debt we were carrying. Not historic lows, but recently speaking. But now that number’s definitely gone up. The other piece that I think has impacted the travel industry is international travel for whatever geopolitical reason you want to look at the number of international travelers coming into the United States has gone down and you saw major airlines all reforecast what they thought 2025 was going to look like.
All the big hotel brands pull down their forecast as well because international travel does impact how much people or the travel industry here in the United States. So those are two of the macro. At a portfolio level, we’ve personally seen it mostly steady year over year. Our hotel is actually doing much better this year than it did last year, which is something that’s exciting for us. But on the single family side, we’ve pretty much been steady year over year, but that is after two years of revenue declines. So we kind of peaked in 2022 for the most part on the single family side as a portfolio. 23 was lower than 22, 24 was lower than 23 and 25 has kind of stabilized. So we’ve got a better sense of I think, what to look forward to. But yeah, it’s been a little up and down for sure. So we’re seeing some of thatOn the international travel thing is we have a ski resort town that a lot of people from Canada come to. And when there was that big push of Canadians not wanting to come to the us, boycotting the us, actually a bunch of the houses even went up for sale that Canadians had owned in that area. And just the people coming in from Canada really reduced during that time period and it had to hurt a lot of the short-term rental owners and even the small business owners in that specific market too.So I think there’s a lot of factors here. And I think, look, Ash and I are not economists, so we’re sharing information based on what we’ve seen. So don’t beat us up in the comments if everything we say isn’t absolutely to the T correct. But I do my best to try and stay on top of the economy and I read things from folks who are far smarter than I am, and we just came out of the Fed to reducing interest rates and part of what drove that reduction was the fact that the labor market was cooling and we’re in this weird spot in the economy where the Fed can lower their interest rate, the Fed can lower the Fed funds rate to stimulate the economy, which is good when we’re losing jobs. But the bad thing is that when we stimulate the economy, that also can potentially drive up inflation.
And when we see some of the impacts of tariffs on inflation, we’re in this weird spot where it’s like, okay, maybe we end up solving the employment issue, but we then get back into this issue with inflation. So I think it’ll be really interesting to kind of see where the economy goes. But Dave Meyer, when he was on the podcast, we asked this question of when we talk about investing, what’s more important? Is it the national headlines or is it the local headlines? And Dave’s insight being the smart kind of economically driven guy that he is, pay attention to the national stuff, but we make decisions based on the local piece. So even as we talk about GDP unemployment, still focus on your specific market and see what’s going on there. Because what’s happening in Buffalo, it’s very different than what’s happening in Los Angeles. It’s very different than what’s happening in it. Montana, very different than what’s happening in Florida or Texas. So just pay attention locally as well.I think that is such a great piece of advice, have that general knowledge of what’s going on, but really local because as we’re talking weak economy apartments in my area are still renting really fast, but those are the middle of the road apartments, not luxury apartments. Those are just your standard basic finishes, nothing high end. They are going so quickly and getting rented out. One thing I did want to add is I spoke with a mortgage lender the other day, and I still am shocked about this. I don’t think I picked my jaw off the ground yet from this, but this mortgage lender was telling me, and it was almost in a motivating way as to I can get this done as in he just did a deal with somebody they’re about to close next week. It was for a VA loan. So I don’t know everything about a VA loan, I obviously don’t qualify, but for a VA loan, he got somebody approved that had a 70% debt to income.
And when he said that to me, I was like, really? And he’s like, yes. And I said, that’s actually kind of scary. And he laughed and he’s like, I know, right? And he said that I guess apparently the VA does have higher debt to income ratios than a lot of other loan products from what he said, but 70%. So as we’re driving the kids to school in the morning, I’m saying like, okay, Daryl, this would be like if he makes a hundred thousand dollars, he has $70,000 in debt payments throughout the year, like live got 30,000, and I’m going through all these scenarios like, oh my god, that is crazy. But to be approved for that. So that I think is a warning sign if you look back to 2008 and you see what’s happening. But if you guys are watching this on YouTube, I would be interested in the comments if you’ve had an experience like that recently where you got approved and not thinking that you would get approved and it really did stretch the limits on this.
Okay, so the next thing that I want to talk about on this is why aggression may actually be the right move. So even though we may be in a weak economy and everything is not perfect conditions for investing, how you can actually be aggressive and what are the things that can actually help you move the needle to get your first year next deal? So the first thing is interest rates. So interest rates actually have come down recently I just had a friend who got quoted for a 30 year fixed at 6.25% for a primary residence loan. And I did a little pull on my Instagram and I asked, is this good? Have you gotten better? And there was a bunch, I think it was at 18% of people that had responded had said they had gotten better. There was, I don’t know, another 25% that said, I don’t know if it’s good.
And then the rest there had said that they thought that that was a really good rate, but it’s not the rates that we were seeing years ago. So there’s still people that are caught up on the fact of I want that 3% rate, I want that 4% rate that you used to be able to get. And I think looking at interest rates is that if you are waiting for interest rates to drop, you are trying to time the market because when they drop, prices are going to increase. So that would be like you would have to find that perfect period to actually get the low price on the property and to actually get the low interest rate. And it also defers the time that you actually start investing. If you wait till interest rates drop, you don’t know exactly when that is going to be.
I’ve had properties for 10 years now. The appreciation that has accumulated in these properties will beat any little bit of cashflow that I would’ve made in those 10 years if I had a really high interest rate and barely had any cashflow on the property. So it’s better to start now than to actually wait for interest rates to drop and you have more flexibility and negotiation because if you can make a deal work with today’s interest rates and then they do drop, say two years from now, you can always go and refinance and it’s like a bonus because now you’re going to cashflow even more because your interest rate was cut and your mortgage payment is going to be lower or you can refinance and keep your mortgage payment the same, but the interest rate is lower, so you’re just taking out more money. So I actually looked at a property that I have that has about $150,000 in equity and if I went and pulled out a hundred thousand dollars in equity on this property and I started over my amortization, so I have about five years left on my amortization of this property at what interest rates are right now, if I took out a loan and did that refinance and started over my amortization, so I had another 15 years, my mortgage payment would stay exactly the same, the differences.
So my cashflow would stay the same, the differences I would get that $100,000 cash out that I could go in and do another deal with. So don’t get too focused on interest rates. That’s like saying property taxes are too high, people still buy properties. That’s saying any other insurance is too high, people still buy properties, make the deal work. So that means offering a lower purchase price on the property. That means how can you increase cashflow or increase rental income. Maybe it’s turning it into a midterm rental or short-term rental so you can still be aggressive with deals and not get the exact interest rate that you want.I could not agree more. Ashley. I think we’re in this golden period of buying real estate and I know that sounds super counterintuitive, but I think that’s the whole point of this podcast because if you think back to when interest rates were 3%, sure there were a lot of ways to make a deal work with the 3% interest rate, but it was also incredibly difficult to find deals because everything was going within 37 seconds of being listed at three x what it was listed for. We’re at a point now where buyers have leverage, interest rates aren’t as high as they were when they had peaked. They’re definitely not as low as they were, but they’re not as high as they were previously, which makes it a little bit easier to make some of these deals work. And then when you start factoring in things like buy downs, either temporary or permanent buy downs, there are ways to make these deals maybe more attractive.
I want to share a quick story on a deal that I’ve been looking at for a while and I actually forgot about this and I might need to reach back out to them, but there was a cabin that was right around the corner from the very first Airbnb I’d ever purchased and I saw it. It’s a very similar floor panel to what we have. That cabin does incredibly well, location’s great. This podcast is being recorded in September of 2025. This property was initially listed in May of 2023 for 1.15 million. It sat for six months and in November of that year they decreased the price from 1.15 to 1 million. When they dropped that price to 1 million, that’s when I initially saw it and I think I offered eight 50 I think is what I offered, maybe even a little less. They denied it just flat out.
No, I followed up not long afterwards, offered eight 50 again, I think they countered it like nine 50 still no for me. They ended up dropping the price to nine 50. Looks like another six months later they dropped the price again. So we started at 1.15. A year later they dropped it down to nine 50. They dropped it again to 8 43 months there afterwards, dropped it again another four months after that to eight 40 and then it sat for an additional nine months and they just removed this listing from the market a month ago at eight 40. So we’re talking about a property that was originally listed for 1.15. They dropped all the way down to eight 40 and they still couldn’t get it soldAnd your offer was eight 50. So they should have taken your offer.They should have taken my offer and they removed the listing at eight 40. But I share that story because imagine, and I feel like I should probably reach out to ’em, imagine how motivated this owner must be to have had this property sit in the market for a year and a half with no major movement.And now if it’s not listed anymore, then they don’t have to pay commission so they can make a little bit more money than they would’ve.But those are the opportunities that are out there guys. And I think the trap that we see rookies fall into is that they try and get into the mind of the seller and start making decisions for them. That is not your job. Our job as the buyer is to present the offer and then put the ball in their court to make the decision based on whatever offer you give to them. Don’t worry about what is listed for what if they listed it knowing that they were asking for way too much, knowing that someone was going to low ball them. So underwrite the deal at whatever number makes the most sense for you, and then submit the offer. If they say no, they say no. If they don’t respond, they don’t respond. But the best case scenario is that they come to the bargaining table, they come to the negotiating.I have a property that I’ve had listed for almost a year now. It’s 10 acres and I bought it for 102,020, 21, 20 22, and I just haven’t done anything with it. So I’m like, okay, it’s time to unload it. We list it, I think it was November of last year, very little traction. We got eight, we had it listed for 139,000. We had an offer at 80,000, then maybe 115. And finally we got an offer at 125. Then their financing fell through and just so we finally two months ago, got it under contract for 115,000 with it being contingent on this person selling another property, they were going to do a 10 31 exchange. So we took it, it was still over the $102,000 we paid. It was 115 after commissions, after attorney fees, after everything’s paid. Yes, we’re not making money on this deal at all, but we had, so in New York there’s weird laws about septic and well testing and blah, blah, blah.
And they actually could not locate a septic on the property because there’s a cabin house on there that’s completely gutted and whatever. But the seller said he was going to back out of the deal because he got an estimate it would be $25,000 to actually put a whole new septic in there. And I said, takes $25,000 off the purchase price because for me to put it back on the market, list it for sale again, go through this whole process, who knows how long it will take. People will see that it’s been on the market for almost over a year. Somebody backed out of the deal and it is worth it for me to have. So it’s knocked down to $95,000. I can do so much more with that money today than risking its setting even longer to get another 10, 15, $20,000. So that’s where I come at from the investor standpoint as I would rather take a little bit less to close now and to get it done than to actually wait and try to get $20,000 or more. So if you never know who the buyer is, it could be someone like me where you say, Hey, give me a $25,000 price reduction. And I say, okay, let’s do it.
I never ever thought that would be me, but it’s just like this property is just sad and sad. So there are motivated sellers out there. So if the headlines have you worried, remember opportunity hides in plain sight during a slowdown. But before we get into the strategies to take advantage, let’s hear from today’s show sponsor. Okay, welcome back. So now that we gave you the reasons of why you should purchase a property today, even in a weak market, why you should be aggressive getting your deals, let’s actually go over some practical strategies for rookies, some actionable items that you can do today. So the first thing is really stick to analyzing your numbers accurately and correctly. Don’t, as much as I love appreciation and I have become a lover of appreciation and what it can do for your wealth, do not speculate and do not buy your deal on appreciation only unless for sure you can afford to pay that negative cashflow every single month into that deal.
And that’s something you know that you can sustain. So for example, if you’re going to buy a property because you think it’s going to appreciate in an area and it is negative $500 a month in cashflow, and you say, okay, I have an extra 500 bucks a month. If something were to happen, you had a medical emergency, your car breaks down, will you still be able to afford that $500 that you’re putting into the property? If you have $5,000 in discretionary income every month that you invest anyways, okay, maybe that $500 isn’t that risky for you to put into the property and you have a plan in five years that property is going to appreciate and you’re going to sell it. You also have to make sure that if it doesn’t appreciate that you are still going, that losing any money that you have into the deal isn’t going to be super detrimental.
So as a rookie investor, I highly recommend getting a little cashflow, having a little meat on the bones, even if you are investing for appreciation and run your numbers accurately by not over-inflating the rental income thinking you can get top of the market just to make the deal work. I’ll play around with the BiggerPockets calculators all day and I’ll say, you know what? This unit is a little bit bigger. I think I can get maybe a hundred dollars more and I will play with it, increase it. But what I’ve learned over time is the more conservative you are and even running the worst case scenario. So I like to do best case scenario as is when I’m buying the property at right now and what it’s rented out for, what it could be rented out for without doing any rehab. And then worst case scenario, I am the bottom of the barrel of rentals and I’m getting the lowest rent in that market to see what the deal looks like. So really make sure that you are running accurate numbers that pencil out and just to give yourself some sense of security and less risk. Do have some cashflow stick to deals that actually pencil out today. And as long as not only speculation or not only appreciation, but don’t speculate on interest rates going down and oh, I’ll just refinance later. Don’t speculate on your insurance going down. So make sure that you’re actually running your analysis accurately.So many good points there, Ashley. And we’re at a point right now where short-term rentals are having this moment, again, because of the one big beautiful bill that passed and brought back 100% bonus depreciation. And I’ve had a lot of folks reaching out to me recently saying, Tony, I want to buy an Airbnb, a short-term rental before the years over because I need to get this material participation. And I think it’s a great notion, but what I’ve encouraged folks to do is don’t buy a bad deal just to get this tax benefit. And it’s the same way of someone buying a long-term rental that doesn’t cashflow to get appreciation. Still make sure that the underlying economics of the deal are sound still make sure that the underlying economics of the deal are solid because we don’t know where things will shift and where things will go.
So yeah, cashflow first, conservative underwriting I think is true for all of those things. I think some other practical things, and we touched on this in that second part of the show as well, but I think we’re at a point where we can get a little bit more creative with how we put some of these deals together. A lot of transactions right now are happening with some sort of seller concessions, right? Seller credits. And lemme just briefly talk about the difference between a seller credit and a purchase price reduction in most situations for me as the buyer, I actually let me define both of these. First, a purchase price reduction. Let’s say that I’m buying a property from Ashley and I ask for a $10,000 reduction in purchase price and let’s say that the property was $200,000. Now our contracted purchase price instead of being 200, it’s $190,000.
Not a whole significant difference to me in terms of cash out of pocket to get that deal, right? One 90 versus 200, if I’m putting 20% down, I go from $40,000 to, what is that, $36,000, right? So not a significant difference there. If I’m doing that math right instead, let’s say that I use that same $10,000, but as a credit, right? That basically means that the seller out of their proceeds from this deal are going to give me back $10,000, which can be applied towards my closing cost. So in that same scenario, let’s say that we’re still the $200,000 purchase price, I’m putting 20% down, it would be $40,000, but with their $10,000 credit, that goes from 40,000 now down to 30,000. So it materially impacts the amount of money I have to bring to the table. You can also use seller credits to maybe buy down your rate, temporary buy down where it’s maybe a two one buy down where your first year is two points lower than your final rate.
The second year is one point lower. You could use it to do a permanent buydown, right? Maybe you’ve put up 1% of your price as a way to buy down your rate permanently and now you’ve brought it down by a few basis points. So I think every single person who’s submitting deals right now or who’s submitting on deals right now should be asking for some sort of seller credit. You’d be silly not to because again, going back to what we talked about before, less competition, more motivated buyers, they’re willing to give you these concessions to move this inventory. Last thing, I’ll say, new home construction, they’re going crazy with these seller concessions right now. We live in a community that’s still being built out and they’ve been building it for, I don’t know, eight years now, but they’re still building. And my wife and I just went by the new ones that they’re building just to check ’em out. And it’s crazy what they’re giving away. They’re like, Hey, we’re going to upgrade your kitchen for you. We’re going to buy down your rate. We’re going to give you a $750 Visa gift card. They’re giving all kinds of crazy concessions. So it might not sound like a strategy to use, but even go look at some new construction and you might be able to find some really good deals just based on all the incentives that sellers or that builders are giving buyers right now,That $750 Visa gift card, you could buy a coffee table. But I think along those lines of how to get creative and look for those incentives and how to ask the sellers for different things, it leaves more room for you to have liquidity because if you are having to put less money into the deal, this gives you option to hold your reserves. So building reserves, this will really help you weather any bumps that actually do happen in the economy. What is to come down the road. So if you use any of these incentives or you get a seller credit, you should plan on taking that money that you have now back in your pocket and using that for your reserves. So if you planned on putting 5% down, but now you’ve got that seller credit where you’re only putting 3% down, take that money and have it in reserves because if the economy does get, we do go into a recession, we do property prices decrease.
Not only do you want to be able to weather vacancies, maybe longer turnovers, your short-term rentals not being rented out and you’re having to cover these expenses. But also too, you want to be in a position to buy. So during COVID March of 2020, I feel like that is kind of the peak of when it shut down March and April, as in my kids got taken out of school, you’re not supposed to go anywhere. During that time, I bought a foreclosure, the house was listed at 90,000. As soon as everything shut down, everyone panicked. Didn’t know what was going to happen. I still did. I am not saying that I was super confident and everything’s going to be okay, but I got that property that was listed at $90,000 for $27,000.
So that’s just, you want to have the reserves to protect yourself so you can weather the storms, but also so that you are ready to jump onto an opportunity. Because again, you can’t time the market and you can’t know perfectly. But if things happen again, something happens or whatever recession and the economy does tank and real estate tanks and you have these cheap properties, you want to be able to jump on those deals and then once you do jump on ’em, it could take some time for real estate to come back up. So you have to be able to hold those properties or do whatever with them until they do have some appreciation in growth. But I mean, if you just look over the history throughout the us, no matter which market most often you’ve held a property for 30 years, it has appreciated. You hear your grandparents talk about how they built their house for $27,000 back in whatever time. So I think the liquidity is important to have the reserves to weather any storms and also to be ready to be aggressive to jump on any deals if the market does take a turn for the worse.Just on the topic of liquidity and building your funds, I was doing a little bit of research while you were talking Ash, because I know Apple, I think Berkshire Hathaway is the same way, but Apple’s known for keeping just a ton of cash on hand and fact check these numbers, but they’re probably directionally correct. Apple’s got as of June 28th, so the last quarter they had over 36 billion with a B in cash and cash equivalents, 36 billion just sitting there. I wonderWhat they’re getting as an interest rate for a high yield interestRate, right? Imagine, and they’re earning billions of dollars, hundreds of millions at least, right? But why do they do that, right? I think part of it is flexibility in what we talked about. If Apple wants to go out and buy some new company, they’ve got billions of dollars just sitting in a war chest, they can go and do that in the same way that if we as investors, Ashley comes across a great deal at a great discount, she can go deploy that capital to go get it. Part of it is like management.My kids have been really into collecting sports memorabilia and it is getting very expensive. So that is my little stash there. I’m going to start selling those babies off when it’s time to buy a property.And just a side note, I don’t know if I’ve been seeing this across social media recently where it’s comparing the return of the s and p against Pokemon cards. And Pokemon cards had far outperformed the s and p. So oh really? It’s like you never know. You never know.When I was in fifth grade, we’re getting really sidetracked here today, but when I was in fifth grade, my brother loved Pokemon and there was a boy in my class that had a big Pokemon collection and he told me if I kissed him, he would give me his Pokemon collection. And I said no. So my brother had never got, youDon’t know actually, if you just said no, it’s like a multimillion dollar Pokemon portfolio.
You wouldn’t even have to invest in real estate as you just give them that little boy a pick on the sheet. But hey, hindsight is 2020. But that’s one of the reasons that that apple stockpile is so much cash that they can have flexibility. Part of it is just managing debt. Even these big companies, they take on debt for different strategic reasons and think about what interest rates went from near zero to whatever they are now, that debt immediately got a lot more expensive. So whereas maybe strategically it made sense to have this debt when it was super low interest, it doesn’t make a ton of sense once it gets high, and again, if you’ve got a lot of cash, you can just start paying down that debt more aggressively. Same thing for us as real estate investors. If we are buying properties at 2.65% debt makes a lot of sense. If we’re buying it at 8%, maybe it’s a little bit harder, maybe now we want to start putting down 30% on these deals instead of 15 or 20%. So I can go on and on, but just know that not only are we saying that it works here in the real estate sense, but just in a general business sense, building your cash reserves is typically better for business.Now, besides just the analytics, the numbers of it is you have to have some kind of mindset shift. You have to be able to clock out all the noise. So first, the headlines as the major headlines that maybe affect a different market than yours, like Tony talked about, you should be hyper-focused on your local market. So if you’re seeing look for unemployment, what is actually the unemployment in your market, your area may not be as detrimental as what it’s forecasting across the nation. So really understanding that and blocking out the noise, but not only with the news, the media, but social media as far as having looking at what other people are doing in realizing that it’s your own journey, it’s your own market, it’s your own life that just because somebody else is doing this and getting that doesn’t mean that that is the right thing for you to do.
You have to analyze your own market, analyze your own numbers, make sure whatever strategy or shiny object they’re talking about would actually work in your market where you want to do this and don’t get caught up. And I’ve talked about this before where I went through this year long period of figuring out what’s next, and I just felt like this pressure that I had to do more, everybody was doing syndications that I knew and I hadn’t done a syndication yet. I wasn’t even close to doing a syndication. And I started, I got a property under contract and I was just like, okay, I got under contract, the next step is syndication. I started learning more about syndications, all this stuff, and I was like, you know what? This actually isn’t for me. And luckily enough, there was major problems with the property. So I ended up backing out of the deal for that reason.
And I didn’t even have to do anything more with the syndication, but it really made me realize that that’s not actually something that matches the lifestyle I want or the type of thing that I want to do. I don’t want to deal with other investors asking me what’s going on with their money or what’s going on with the deal. Just like I don’t want to be a property manager to anyone else ever again except for my own properties, because I don’t want to deal with owners, deal with landlords, I see how I am. I don’t want someone else to be like that, to be. So I ignore the noise and really just focus on what’s best for you. And that goes back to the basics. What’s your why? What kind of life do you want? What actually fits around that?And I think the next piece of that too, Ashley, well, lemme comment on that first. I couldn’t agree more. I think it’s so easy right now in the age we live in to get enamored with so many different ideas and what’s going on. But I think being able to focus on, hey, what’s best for me or what actually works best for me will allow you to really maximize the things that are going on in the economy right now. I think the other piece too about the mindset shift is that Warren Buffet has that quote, right? Be fearful when others are greedy. Be greedy when others are fearful. And I think we’re entering into this phase where there are a lot of people who are fearful about getting started, but sometimes, and historically, some of the biggest fortunes are made when people are fearful, the biggest fortunes are made during a downturn.
Think about all the people who made tremendous amounts of wealth after the 2008 crash. Think about all the people who made tremendous amounts of wealth investing through COVID. Like all these little things that have happened created tremendous amounts of wealth and we’re still in that golden opportunity. So I think just shifting your perspective from, man, this is a scary time to, yeah, it’s scary, but it could also be the best time is the way that we kind of get around that. And I’ll finish this point out with just a personal story. The very first short-term rental that we bought, we bought that during the summer of 2020. This was the thick of COVID obviously. We had just gotten past March and April, everything was super crazy. But people kind of looked at us like, what are you doing buying a short-term rental when people are staying home?
But it turned out to be the best investment that we ever made. Still to this day, that is by far the best deal we’ve ever purchased. And had we been fearful, have we not had a little bit of courage, that never would’ve happened. And I wouldn’t be me. I wouldn’t be Tony j Robinson, the guy who’s built the short-term portfolio. So yeah, sometimes we’ve got to take a little bit of risks, measured risks, but risks all the same. So guys, we’ve covered the numbers and the strategies, but sometimes the biggest hurdle is how you think about the market. Now, before we wrap up with action steps, we’re going to take one final break to your word from today’s show sponsors. Alright guys, welcome back. Now before we wrap, we want to talk about really the action steps that you, the rookie should be focusing on as you try and implement what we’ve talked about here in today’s episode.
And the first thing that you should do is to define your buy box. And when we talk about buy box, it’s essentially what type of property should you be looking at? So obviously that’s knowing your market, but more importantly, it’s the type of property you want to go after. Are you looking for single family homes, small multifamily, large multifamily manufactured homes, mobile homes, dirt lots? There’s so many different ways that you can go about, but know what your buy box is. Do you want big? Do you want small? Do you want expensive? Do you want affordable? Identify what makes the most sense for you so that you can move fast when something does hit. When I got my very first deal, I could tell you within five minutes, even five seconds whether or not a deal was a good deal in the zip codes that I was looking at because I had analyzed so many different deals in that specific zip code at a very tight buy box. I was looking for a three bedroom, two bath, single story home built 1950s or later and a specific zip code. And I had analyzed virtually every single deal that fit that buy box. So I got really, really good at quickly identifying what a good deal is and what a good deal. So when the right deal did pop, I was one of the first people to submit an offer because it’s like, okay, this is the one, let’s go get after this one.And you guys, we have a checklist template for you guys to go along with this. If you go to biggerpockets.com/resources, make sure it’s plural because they’re also going to be taken to the guides. But biggerpockets.com/resources and you go to the beginner, rookie real estate investments, whatever the first option is, and you go into there and you’ll find our buy box checklist. So it will walk you through everything you should think of if you want a property that has that or not, or bedroom count, what’s the ideal bedroom count? Is it two to three? Is it five to six for house hacking rent by the room? So it just helps you think through how to actually build your buy box and what you should include in it. The next thing that you can also use on biggerpockets.com is the calculators, the calculator reports. I still have calculator reports saved from when I first discovered BiggerPockets in 2017.
So you can save them all in there if you’re a pro member, but you need to practice. Think about great athletes. What do they do? They practice. Think about anyone who’s in a competition, they practice. Think about even professionals. They practice in a sense that they’re going to get their CE credits, they’re doing continuous training, they’re learning they’re doctors. They’re continuously doing something to keep that memory, that physical memory of doing. What’s that? What am I thinking of, Tony? The muscle memory. Muscle memory, yes. Doing a surgery. So run the numbers as much as you can take a property off the MLS. Even if you just look at it knowing this would never ever in a million years make a good rental practice running the numbers. Where are you getting the insurance quote from? Where are you finding the property taxes? How are you estimating the rehab?
And just keep doing that, doing that, doing that, and really figuring out how to niche down. If you are in some kind of meetup or even a Facebook group with investors in your area, plug in these numbers for this property and this calculator report or the BiggerPockets forum. So you can do this add calculator report and say, Hey, this is for a property in Oklahoma City. I would love anyone’s feedback that invests there to take a look at it, especially in the bigger practice forum, you’ll get so many responses. I would assume it’d probably be even more if you’re in a super local Facebook group where everybody is investing in that market to give you feedback as in, you know what? I actually don’t think that would be the insurance. I have a property down the road, it’s a duplex. It’s similar that my insurance on that is X amount a year. So getting that feedback, it can be super helpful. It can help you really tighten up your numbers and just get more and more comfortable. But I think just exercising that muscle memory.The next important piece is building out your team. And luckily BP has made it incredibly easy to at least start this process. There’s the agent finder, there’s the lender finder. You’ll find plenty of insurance agencies within the BiggerPockets ecosystem. And those are really kind of the foundational people that you need. As you start thinking about getting your first deal, your agents or the multiple agents are going to expose you to different potential markets. They’ll also be like your expert in that market. Talked to an agent once who was in Florida, and I’ve shared this already before, but it was just such a crazy thing, but she told me, she was like, Hey, if you want to buy in my city, don’t buy in this HOA. And she named the HOA, but she said, don’t buy in this HOA, because I just found out that the owners have all banded together and they’re about to sue the HOA and the builder.
You’re not going to see that on the Zillow listing. It’s like, Hey, come buy my home, but I’m an open litigation. But because she’s in that city, she had that insight. And then she told me, she said, do not buy any homes in my town that were built in the nineties, any other decade, you’re fine. She’s like, but I’ve been buying and selling homes here for a long time. And for whatever reason, the ones built in the nineties are always the most expensive when it comes to flood insurance. Again, you couldn’t get that information without seeing dozens and dozens or hundreds of transactions to pick up on that nuance. So finding the right agent, I think is oftentimes a great starting point because they have that insider knowledge and they can connect you to the other folks you’ll need in that market as well.And they can help you build out your buy box too, because obviously you probably added to your buy box, not a home in the nineties that you’re looking at. So the last piece I’ll add here is just to stay educated, keep sharpening your knowledge, absorbing podcasts, reading books, talking with other investors. By the time this airs, you guys will have missed a BP con, but it should be announced where the next BP Con is by now. So you start planning to get there, to meet people, to network with them, to learn some things and just constantly absorb as much as you can on Instagram. Just follow people who are doing real estate investing that are educating on real estate investing. And the very last thing is take action so you can only get second analysis paralysis for so long, and at some point you have to take action, even if you’re not 100% sure this is the home run deal, this is it.
You have to at some point take that leap and buy that first property. And Tony and I are here for you. We are here to help you along the way of your real estate journey, and we appreciate every single one of you that tunes in every single week to listen to us, to listen to the rookies that take the time out of their busy days to come on here and share their own experiences and to tell you all the lessons that they learned. And then even the experts that we have come on most recently too, we’ve been trying to add some more in here and there to really help you guys on very specific things that are far beyond what me and Tony are experienced on, to really give you that insight, that knowledge. And then lastly, the people that actually ask the questions publicly, like in the BP forums, in the real estate rookie Facebook group.
So we can take those questions and answer ’em for you guys on the rookie replies. So just a big thank you to you guys. We appreciate you guys so much. And if you are a rookie investor that is stuck in this analysis paralysis or has been worried about this weak market, find some accountability. Go into the BP forums, go onto Instagram, find somebody that you can work together with where you’re going to hold each other accountable and you’re actually going to get that first deal. And then when you get that first deal, after listening to this episode, you’re going to DM Tony or I on Instagram or message us on our BiggerPockets, and we’re going to get you on the show and you’re going to tell us your story. So Tony, how does that sound?I can’t wait to hear more success stories coming onto the show. And you guys would be surprised. So many of our guests said, I started off by listening to the podcast and hearing someone else’s story, and it’s so cool to be here now. So we’d love for you to be that next success story. So actually, if you guys want to apply, head over to biggerpockets.com/guest and we’d love to hear your story to get you on the show as well.I’m Ashley. He’s Tony. And we’ll see you guys on the next episode of Real Estate Rookie.