Jason Hartman and investment counselor Adam start the show with a listener question from Amina. She wants to know what her options are given that she’s maxed out her Fannie Mae and Freddie Mac loans. Then Jason brings on David Nelson and his wife for a client case study. They discuss their real estate portfolio and how they have been able to retire early as a result. David emphasizes the need for continual education.
Investor 0:00
After I started going to events and hanging out with some of the great people in your client base, I was talking to a group at the Cincinnati and poverty tour and one of the guy I told I’m maxing out my 401k they’re like, why are you doing that? What Why don’t you just do where the company matches and then take the rest and invest in real estate. You know, it’s like a big light bulb light bulb moment. So I did that I dropped my I was putting like, 17 18% you know, pre tax money into this, that I had no control over. So I dropped it down to where the company was matching, which makes sense. And then I’m taking the rest out and buying more property.
Announcer 0:38
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s out actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it on Now, here’s your host, Jason Hartman with the complete solution for real estate investors.
Jason Hartman 1:28
Welcome to Episode 1193 1193. Thank you so much for joining us today. We’ve got another client case study a returning client, who was on a few years ago and has been building a great portfolio. He and his wife, David and Gina Nelson, have been building a great portfolio now they’re up to 26 units. I was surprised I didn’t know they were doing so much with us. So I was happy to hear it. And we’re always grateful to have our clients on the show. Of course, we’re grateful For the business and the support, and we want to support you any way we possibly can. But I tell you, we learn a lot from you clients. And I know you listeners learn a lot from our clients. You keep telling me that so we want to invite more clients onto the show. If you’re out there and you want to be on the show, just contact us through the Jason Hartman. com website. And we’ll see if we can get you on the show. And have you scheduled for your 15 minutes of fame as it were. It’s an old cliche. I’ve got Adam here with me and before we get to our case study today, we have a listener question Adam fire away. So this is from Amina and Amina wants to tell you that she likes your show because there’s no pretentiousness no frills just to the point up to date information regarding investment with a focus on income properties. Well, Amina, that is very much appreciated, but some people might not say I’m to the point. She doesn’t hurt my tangents I don’t think right maybe your attention They’re close enough to the point I think they are. But some people don’t. Anyway, go ahead. She said she started listening to the show about four years ago and found that you’re so sincere that within two months, she started buying properties. Instead of the few podcast she listens to this is number one. concept of inflation induced debt destruction. Yes, inflation induced debt destruction. Say it 10 times fast. If you can, I can’t. What she really wants to know is for someone who’s maxed out their 10 available, Fannie and Freddie conventional loans. What are the options for you after you get through with those? Yeah, that’s a great question. Amina. So for everybody else. What Amina is talking about is that coming out of the Great Recession, they put a cap, while the two major secondary markets for mortgages, Fannie Mae and Freddie Mac, put caps on how many mortgages people can have and it first coming up One of the great recession it was for mortgages. And as you might imagine, that wasn’t very good for business. And it wasn’t very good for the economy either because you investors are a huge stimulus to the economy. Think about the processional effect. And this might be a tangent alert of your investments, right? When you buy a property, you are employing a whole bunch of people that fix up houses that paint houses that install appliances that make appliances. Wow, you do a lot of stuff investors. So pat yourself on the back. And be sure to understand your huge contribution to the economy and keep on doing it because you really are a giant part of the economy, real estate investors. So they did increase it to 10 loans. And before that, there was really no limit and some people had hundreds of mortgages. Were not back there yet. Maybe they went a little overboard back then. And obviously, we did have a mortgage meltdown, which was only part one of the great recession. Part Two was Wall Street. But what do you do after you buy 10 properties and you finance them. And you want to keep building your portfolio, you want to acquire 26 properties like our client case study guest coming up here in a few minutes. There are several options. Number one, if you are married, and by the way, if if you’re single, this might be a reason to get married.
Jason Hartman 5:39
If you’re married, and your spouse can qualify, then they can get 10 loans also. So between the two of you can get 10 each or 20 mortgages and therefore you can finance 20 investment properties and whether or not you’re married to go beyond that. 10 loans. per person limit. Thankfully, capitalism being a very efficient economic philosophy has filled the void to some extent by bringing in all of these groups that are offering some pretty good financing for you to go past that 10 loan limit. And these are hedge funds, private equity groups, and various I’ll just say institutional lenders that aren’t following the Fannie Mae and Freddie Mac guidelines. In fact, they cater to real estate investors, and they offer some pretty good products not quite as good as what we call the agency loans or the Fannie Mae Freddie Mac loans, but they’re they’re pretty good. I mean, the rates are a little higher, the terms aren’t quite as good, but they’re not bad. And then the other option B That is you can do hard money loans. And those rates are much higher. They are really not geared for buy and hold investments. They’re geared mostly for flipping properties, the hard money financing, because it’s it’s pretty expensive. And you would only want to use it on a short term basis whenever possible. Adam, any thoughts or things to add, you do our mortgage update every month on the Well, usually on the first Monday of the month. Anything to add to that? Well, I would just say whenever you’re looking at the mortgages and the proform, is you just need to take into account as you’re starting to look at the site and looking at the pro formas. And knowing that you’re going to have to adjust your cash flow based on that. So if you see it marked like they are right now, like five, five and a half percent, but you know, when I go to these institutions, I’m going to get 7% say, right, you need to make sure you factor that in because our performers are based on the Fannie and Freddie the interest rates, not the higher institutional rates, right and that, that’s an Another good reason to actually subscribe to the property tracker software, you can get on Jason Hartman calm and get that discount link there. Because then you can work with a dynamic performer where you can change all the assumptions, not just the mortgage rate. And I’ll tell you that was really a good part of my training on becoming a good evaluator of properties. Back in 2004, yes, way back in 2004 15 years ago, when I started using that, that great software, I would do performance constantly. For properties, I would make them myself. The perform, of course, is just the one page sort of outline of the properties performance. And you can find those all at Jason Hartman calm in the Properties section, but those are static. So if you actually subscribe to the software, they’re dynamic, where you can put in your own assumptions, you can change your Everything you can change the rental, the projected rent, you can change the mortgage rate, you can change the vacancy rate, you can change the repair and maintenance costs everything and then it just becomes your own. But if not, if you don’t want to subscribe, then you can simply calculate the mortgage payment there’s a million mortgage calculators on the internet, then you can just insert that new number into the Performa and, and for example, if it says that that property has a projected cash flow of $200 per month, but with a higher interest rate, as Adam mentioned, that you you might get from one of these non agency lenders, these sort of institutional but non agency lenders that don’t comply with Fannie Mae Freddie Mac guidelines. Maybe your mortgage will cost $70 more per month, for example. And so your $200 cash flow projection will now go down to $130. So still Certainly not a bad deal but not quite as desirable. So your first 10 are going to be the best deal. And if you’re married then that that additional 10 would be your spouse gets, those will be the best. And everything after that will not be quite as good, but it’ll still be pretty good. Alright, so um, you know, thank you very much for the question. If you have a question make sure you go to Jason Hartman comm slash ask and we will get it answered as soon as we can. Right and also go to Jason Hartman calm and right on the front page. Check out our upcoming cruise to Grand Cayman Cuba and Jamaica and that leaves from Fort Lauderdale you really do need to get that booked because prices are going up. And our I don’t even want to say room block I want to say space room block or cabin block on the ship. Holland America Line nice cruise ship. I’ve taken them before they run a first class operation. It’s going Be an awesome adventure Alliance trip and you don’t have to be a member to come You can come as a guest, of course members get member pricing. But you can certainly come as a guest. That’s just going to be a phenomenal trip. Cuba is one of the most interesting countries on the planet. I mean, I’d say probably the most interesting country on the planet is North Korea. But I’m too chicken to go and visit I did recently visit South Korea. And we went to the DMZ as you heard on a prior episode, but I don’t quite have the guts to go to North Korea. But Cuba I’ve been to before and it is fascinating, fascinating, fascinating place. If you have ever wanted to step into a time machine, come to Cuba with us, because we will put you in a time machine and transport you back to 1959. It’s really an amazing place here. You must join us. Jason Hartman, calm right on the front page. Sign up for that cruise and join us Adam, let’s get to our guests today and our client case study.
Jason Hartman 12:11
It’s my pleasure to welcome one of our wonderful clients back to the show. This is David Nelson of David and Gina Nelson, you heard them on the show before. And they have been doing amazing things with their property portfolio. growing, growing, growing, learning some lessons along the way. Lessons aren’t always easy, but we’re going to share some of those today. And, and like I say, you know, if you’re not learning some lessons and making some mistakes, you’re just not doing anything. So, David, thanks for coming back on and sharing with us. Appreciate it.
David Nelson 12:41
My pleasure. It’s absolutely honored to be on with you today. Jason.
Jason Hartman 12:45
So you were first on the show. I remember interviewing you and Gina, when we were walking back from lunch, we were in Oklahoma City property tour. And it was the first time I got to use at the time my new microphone and I was so excited about that. Right
David Nelson 13:00
That’s right. I remember that. Yeah,
Jason Hartman 13:02
I think we almost got run over by a car when we were not paying attention. That was a walking interview. Yeah. Yeah. You had Coco along the answer, right for the right. Company. That was great. That was cool. That was cool. A walking interview, haven’t done too many of those. But you and Gina have been coming to a lot of our events, and we’re really grateful to have you at them. You’ve been building quite a real estate portfolio. Honestly, before we talked a couple of minutes ago. I didn’t know you were already at 26 properties. So congratulations, first of all, thank you so much. It’s it’s been life changing for both of us. And so you started with us what in 2016? About three years ago?
David Nelson 13:43
Yeah, I started in around March of 2016. I actually spent about a month listening to your podcasts from a referral from a friend of mine, con Moran, who’s also he’s very active in your network. Yeah, Khan. He turned me on to You’re Jason Yeah. Jason Hartman. com website and I started listening to podcasts. I spent about a month listening and I jammed on a phone with a phone call with Sarah and we picked up a property in at the time Allenwood, Georgia right before Georgia became Atlanta became kind of hybrid. After that one, we picked up seven, six more through 2016 and 2017. And now we’ve partnered up with a couple of great friends that we knew through business before. And we’ve picked up another 16 doors since 2017. It’s been something great.
Jason Hartman 14:37
Yeah. Good for you. So you had the one property that you bought in Georgia, then you bought six more after that. And then you partnered with some friends? Yes. And bought 13 or 16 more doors. Did you say how many
David Nelson 14:53
16 more doors Exactly. Since we partnered up Yeah.
Jason Hartman 14:57
And now you I know right? You’re just buying your first property inside of your IRA. Let’s see from our local specialist in Jacksonville, Florida.
David Nelson 15:06
Yes, we bought two duplexes from him last January. So I had bought a turnkey back when he was doing turnkey. I bought one in Jacksonville. Yeah.
Jason Hartman 15:17
And but this is the first side your IRA is what is unique.
David Nelson 15:22
But what was good, I liked his outfit, I really got a good feeling from them. And they were he did what he said he was going to do. So he was ethical, honest, and I you know, talking to him live and your events, I you know, I got to meet him and get to know him. So I had a good trust level. So, Gina, she’s been so on board with, she’s been so supportive, she’s just amazing. And she’s an entrepreneur. So he’s actually started three businesses the last few years. One of them took off so remarkably that like I was talking to you about she left her corporate job that I got a 401k rollover into self directed IRA and now she’s buying you property in Ocala, Florida for single family residence there, so pretty exciting.
Jason Hartman 16:04
That’s excellent. So and Gina, of course is your wife and she was on the show before there is we talked about that. So and you guys, by the way, I should say are from Folsom, California, Northern California. Right, David, what do you do? Again, tell the listeners what you do.
David Nelson 16:17
I’m Information Technology supervisor for large healthcare Corporation up here and doing that type of work for 30 plus years at this company, I’m 15 years in now.
Jason Hartman 16:28
Good stuff. Okay. So when you first got to know us, your friend, comoran or client referred you to us and you listen to the podcast, and what was the first event you came to? Was it that property tour that where I met you know,
David Nelson 16:43
we went to one in Ohio. First time we went on something was it was like in June of 16. actually went and met con and his wife there at that tour, the Cincinnati tour. Yep, I remember back then. Yeah, yeah, that was the very first event then we’ve got You know, several, meet the masters and your some of your Jason Hartman education. Other events I’ve gone to Yeah. Excellent, excellent, good
Jason Hartman 17:07
stuff. You were saying that you learned some lessons and had some successes and some difficulties. Tell us about both, you know, tell us about the successes and the difficulties,
David Nelson 17:19
things were going really well in 2016 and into 17. So I got a little cocky, to be honest with you, I thought, you know, this isn’t so hard, I can do this, you know, on my own. So, I decided to go buy a property from a wholesaler without doing really due diligence. And I didn’t follow with the property inspection. I didn’t really take seriously some of the stuff that was flagged on the inspection with regard to electrical and some things and I just all I saw was potential numbers. You know, I saw this okay, I can get 1300 bucks a month for this hundred thousand dollar property, blah, blah, blah. You know, I learned a very valuable lessons after I bought I had to dump thousands and thousands into it. Get it, you know rentable, and that it was just yeah, just a very valuable lesson for me to do a better job of research and analysis. Sure, sure.
Jason Hartman 18:08
So let’s just tell people what that all means. So this was a property outside of our network. And when you say you bought a wholesaler, you know, for those who don’t know, a wholesaler, basically, I mean, this has kind of several definitions. But mostly what people mean by wholesaler is someone who goes around and tries to find motivated sellers. They tie up a property, put it on a contract that’s assignable. And then they sell that contract to somebody else. And so basically, they won’t even touch the property. They won’t even take title to the property. They don’t even ever own the property or have any intention of owning it. They’re basically creating a contract and selling the contract to another party. So you were that other party that bought that contract from the wholesaler, and that property wasn’t rehabbed. Obviously And you didn’t have as much knowledge or information about it right? What happened? Right? Yeah. And you’re exactly right. It was from a wholesaler, I, I looked at the property online. I, you know, I looked at photos, I did get an inspection and really, I talked the inspector and I should have paid more attention to the stuff that he flagged and I took the chance. I did it, it was just a risk. And I knew then ago, this is risk, but the reward was, hey, look at the rental value. Look at the great numbers I could get, you know, and I’ve never actually realized those numbers and factoring in the stuff I have the money I’ve had to put into it. Looking back I was a failure. It’s not a failure, because I won’t do it again. Right, right. Well, as long as you learned something, there are no really no failures, right? But you’re planning to soul one of your properties, I think, is that the one you’re gonna you want to sell.
David Nelson 19:48
That’s the one I’m working on. I’m almost ready to get it almost ready to sell. Yeah.
Jason Hartman 19:53
Okay. Okay, good on that one. I mean, listen, you know, everybody makes those mistakes you see dollar signs and You go for it. So don’t feel too bad about it. It happens. But I’ll tell you, I think one of the lessons here for our listeners is that we constantly are approached, you know, I’ll get an email. This happens somewhat frequently, that’ll say, hey, I’ve got a small portfolio of seven properties in Indianapolis or Memphis or some Texas City, can you sell them for me? And we always turn those people down. Okay, we don’t do any one off deals. And that’s one of the things out of the thousands and thousands of properties that we’ve sold over the years. We have never done a one off deal. I should qualify that a little bit. We have done one off deals on a few big properties, you know, apartment complexes, bigger deals, but not on the sort of what I’ll call the assembly line, single family homes in the small Plexus duplexes. triplexes for prices because one of the things That you’re really buying. And one of the things that you really want to use as a kind of the carrot and stick, if you will, is the opportunity for future business. And you need to make them see that and when it’s a guy doing a one off deal like a wholesaler, you know, there’s just not enough leverage in that kind of deal, you know, and that’s why I don’t like them. That’s why we we just don’t get one off deals, you know, we only do transactions based on an entire relationship. So if we’re not going to be in a position where we can have a relationship with a local market specialist, and hopefully over the years, sell hundreds and hundreds of properties with them. We’re just not going to enter into it. It’d be nice for some quick bucks, but I just know that we’re not gonna have any leverage and things aren’t going to usually work out well. So, so I think they’re kind of part of that lesson is just being in a transaction where you just don’t have
David Nelson 21:56
enough leverage, right? Yep. 100% agree on that one night. I haven’t nothing coincidental about it because I haven’t done it again. So
David Nelson 22:04
lesson learned,
Jason Hartman 22:05
yeah, lesson learned. I got ya, I got Yes. But you know, the great thing about income property, like I always say is you can renegotiate the deal all along the way. So, you know, that deal might get better, you know, maybe you should just get rid of it if it’s really a problem child, but it might get better, you know, you might get a better renter, you might get more money, you might decide to improve it, refinance it, there’s lots of ways that you can quote unquote, renegotiate the deal along the way. Right, right. Yeah, good stuff. So tell us about you know, any of your successes or just experiences that you want to share with our listeners from all of the other properties, all the other, you know, the 26 properties.
David Nelson 22:42
I think you have to really have some thick skin and that you’ve said it many times you don’t get emotional about it be and be area agnostic. And one of the great lessons we’ve also learned is to manage we have a few that we self managed, but most of them are property managers. Don’t be afraid to manage property managers I, I have fired many of them. And I don’t fire them the first time, I give them chances. And the I’ll give you one example in Memphis, I had one that charged me $150 to replace a flapper and a toilet. And I had asked him for that. And I said, Okay, that was the last straw you, you’re done. And I went on to another one. And I’m in the process of moving four of my properties. And Sarah helped me out finding a good property manager there. I’m moving four of my properties from one property manager in Memphis to another that’s happening at the end of this month. So don’t be afraid, one of those Don’t be afraid, and they’re helping and I think I’ve mentioned this before is let the new property manager help you take over from the old line manager, right? Yeah, I give them each other’s contacts. I say here’s what we’re doing. Go and then they take care of everything. That’s awesome. You just step out of the way and let them do it.
Jason Hartman 23:55
Now. You’ve never done any self management. I’m sure you’ve thought about it because your heroes Getting better on the podcast all the time or have you? I don’t know we do. Yeah, we have a few properties that we’re doing that the one in the ones outside of your network
David Nelson 24:09
we’re not self managing any that we got from you. We’ve got one in Kansas that I’m managing and one in Texas.
David Nelson 24:17
Denton, Texas Okay,
Jason Hartman 24:18
so you’re 1500 miles away, give or take from those properties. How’s that going? How you doing the self management? How’s it going for you?
David Nelson 24:28
It’s been absolutely fantastic. And because I got direct contact with I’m actually very blessed because the tenants are are awesome. So they’re reasonable to work with one of the guys I’ll give you an example one the one guy in Wichita, Kansas, he, he had a busted door on his dough, he fixed it himself. All he did was Show me your receipt for the part and he took care of the labor. So I just deducted the part off of his rent. It was really like 70 something box Isn’t that great? You sometimes you’re an example. Sometimes your tenant is your best Best contractor and your best manager, your tenant will be your property manager to some extent. Yeah, yeah. And I think I’d like to expand down the road when like done with the corporate gig that I’m doing. I’ll definitely look at doing some more self management and even maybe before that,
Jason Hartman 25:19
yeah, after you’re retired from the corporate rat race, right?
David Nelson 25:22
Yeah. Okay. Exactly. And that’s, that’s what it is.
Jason Hartman 25:26
And again, you know, something I want to say to the listeners, many times just because of the nature of the way things are set up, self management doesn’t take any more time. In fact, sometimes it takes less time than managing your manager. And I know there are people that have never done it, who might not believe that they might be skeptical of that comment, but I’ve done it. We have lots of clients who’ve done it. And you know, you’ve heard drew Baker on the show many times talk about it. Now he’s sort of overdoing it, if you will, in He admits that firsthand you, you saw him speak at our last meet the masters. I know David, he’s gone into self management. But what he’s really doing is he’s doing a lot of, frankly, capital improvements to his properties as he’s self managing. So he’s spending, you know, more time than most people would on it, but just to do the kind of status quo self management, you know, honestly, I just think a lot of times, it’s just easier than having a manager in the way. And I’m sure we all find this to be true. A lot of times, I mean, look, we’re not in an era where many people use travel agents anymore, but they still exist. And a lot of people have their assistance, doing things like book their travel, right, you know, book their airline tickets or things like this. But a lot of times, it’s just faster and easier to do it yourself. Technology has enabled so much do it yourself stuff nowadays, it’s just easier to do yourself. I find that sometimes, and you know, I’m sure I’ll get some criticism from this from some People, there are some things that just they just don’t make sense to delegate. And I would argue that one of them is property management. In some ways self managing is is really much easier than having a manager.
David Nelson 27:14
So anyway, we’ve talked about that ad nauseum. But Yep, good advice. I think mix and matches is not a bad gig, and you can bring it out grew went from eight or 10 properties that he kind of took it in chunks. He started managing four or five of them right away. And then I love what he’s doing.
Jason Hartman 27:29
He did it by city. He did it, I believe, first he did Indianapolis. And he took all his properties there and made himself managed and he, he liked it so much, that He then took Memphis and he self managed all his properties there too. It’s good. And you know, what I would say is that, you know, sometimes I find that just letting the world or the marketplace make a decision for me is a good way to go. So if you’re listening to this and you have a portfolio of properties, just take your worst property managers and fire them and self manage those. If you have a great property manager, just leave it alone. That’s what I do. I just kind of let the frankly I let the manager decide if I’m going to self manage. If they’re really good, I’ll just leave it alone, let them manage it. But if they’re difficult, or they’re, you know, given me a bunch of piddly little expense deductions for repairs that are sort of absurd A lot of times, you know, I’ll just get rid of them and I’ll self manage it. So I kind of let them decide they get to decide whether or not I’m going to be their customer.
David Nelson 28:33
Right? Yeah, yes, exactly. I like
Jason Hartman 28:35
yeah, I’ll take my money where it’s treated better if they don’t treat it well. money goes where it’s treated best. Yeah, good stuff. Well, what other lessons or experiences or you know anything you want to share?
David Nelson 28:48
What I look at real estate for us? I look at it kind of like the presidential election, like like Trump was an interruption to the normal process of what we’ve been doing for so many years. I think it was to me It was like a socialism interruption. But that will that’s another issue. But in a good way got us real estate got us thinking bigger. It got us dreaming bigger, it took the lid off of limiting what is possible. It got entrepreneurship in our heart and soul. It’s really meant a lot because when you combine education which you provide with actions, there’s really nothing you can’t accomplish if when you put your mind to it, and despite like the evictions, we’ve had a few evictions, we’ve had some issues, we’ve had maintenance, we’ve had this and that. But looking at the big picture, if you can look and not microwave your success, you have to look at the big picture. And look down the road five to 10 years is of something you can control. This is a great avenue and as you’ve said it millions of times as text favorite is anything you can get right. So yeah, it’s been a good ride that way. So I just say look at what your financial goals are and what your crews in control of them and then look at real estate You can I think you can get a very good marriage that way.
Jason Hartman 30:03
You know, what did you do before real estate? were you doing the typical? I know Gina like you said your wife had a 401k but when she left her corporate job she converted to self directed IRA and now is buying a property inside the self directed IRA. That’s awesome. Yep. We had a speaker on that at meet the masters. I know you’re working with them. What were you doing before just the typical like some mutual funds for one case some stones you know, whatever. Yeah, How’d that go?
David Nelson 30:28
That’s exactly right. I was doing you know what my dad told me to do. You know, it’s like put the max in and do a moderate to aggressive at your young age. And then when you get older, make it more conservative and just let them manage it and let the money build. And it was all for was I’ve got actually got a pretty, pretty decent 403 B 401k. That I have that here’s a point on that is after I started going to events and hanging out with some of the great people in your client base. I was talking to a group at the Cincinnati and Probably torn that one of the guy I told I’m maxing out my 401k. Like, why are you doing that? Why don’t you just do where the company matches and then take the rest and invest in real estate. You know, it’s like a big light bulb light bulb moment. So I did that I dropped my I was putting like, 17 18% pre tax money into this, that I had no control over. So I dropped it down to where the company was matching, which makes sense, right? And then I’m taking the rest out and buying more properties with it. So that so that was what I did. But when I retire, I’ll take that. And I’m going to do, we’re using Gina kind of as a model will I’ll do what she’s doing with her buying real estate within her IRA. And that’s what I’m going to be doing.
Jason Hartman 31:40
That’s awesome. That’s awesome. So what are your plans for the future? I mean, that sounds like you are planning to retire from the corporate rat race here. At some point.
David Nelson 31:51
Your wife is dying already. What’s your plan for your real estate investments and what is it gonna mean to you? Oh, actually did it in their 40s to I’m kind of jealous but I’ll be probably Probably right about the time I retire all I’ll be about near 59. So I’ll be able to get at that IRA.
Jason Hartman 32:07
Yeah, if you want, you could take this.
David Nelson 32:10
And we’re definitely all in. We’re all in on the just investing in real estate and making that I want to get to where I’m 80% invested in real estate and 20% or less in other areas. That’s our big picture goal. And then real estate will become my business, which it already is, but it will become my full time business. And that’ll be you know, the income from there will sustain us and when my daughter is out of college, because we’re paying cash as we go for her college, so when she’s done, that’s when I’m done. Yep.
Jason Hartman 32:45
So here, here’s the thing. Some people might be listening to that, especially new listeners to the show. If you haven’t been listening for the past 15 years. You know, you might hear what David saying and you might think that does not sound prudent to be 80% in on one asset class. And here’s what I would say to you is that number one, just remember, income property is the most historically proven asset class in the world. And David and Gina are diversified, because they’re diversifying geographically. If real estate goes down the tubes, so will the stock market. So will pretty much every other investment, okay? And income property really is a diversified asset class because it’s something that reflects so much of the overall economy, but you have such unique multi dimensional characteristics that enabled you to protect yourself from downturns. For example, if you have stocks and they go down in value, you know, that’s the end of the story. They went down period, precious metals, they went down period, cryptocurrencies they went down period you’re done. Whatever you There’s nothing else to do. But with income property, you can add some creativity to the mix, you can add gesture strategy, you can be a cash flow investor more than a capital appreciation investor and you can constantly shift you can refinance, you can improve the properties, you can let them languish and not maintain them. Well, I know this sounds crazy, right? You can be really cheap with your properties and not maintain them well and not upgrade them over the years. And you can, you know, just let the rents stagnate. That’s actually a strategy. You know, the point is your control, you can do things to adjust to the economy to adjust to the marketplace, with the stocks, the bonds, the mutual funds, the precious metals, the cryptocurrency, you can’t do anything. You’re just it’s whatever it does is what it does. Here. You can add some strategy of your own to the mix.
David Nelson 34:47
Absolutely. Yeah, we’re all in there. Good. No doubt. Good stuff. Good stuff. Well, David, thanks so much for coming back on the show and congratulations on your success. 26 doors. Hey, keep on going. How many Are you buying this year? Oh, we are definitely buying. We’re buying two more here in the new few near future, but we’re looking at the next couple of months. But beyond that we’ve got a couple of moves we’re making financially. When I sell, here’s what to do, and I sell that Indianapolis property. I’ll be looking at two more properties.
David Nelson 35:18
Well, so you’re doing a half dozen.
Jason Hartman 35:20
Yeah, you’re doing the two for one exchange. I’ve done it many times. That’s it. Yeah. Yeah. Yeah. And there’s several, there’s a few actually, the one in Ellingwood, Georgia has appreciated so much. We want to do a 1031 out of that one. So it’ll be great. So you’ll take that one property 1031 exchange, and you’ll get two more, you might even be able to get three more, you could do the three for one, potentially, it’s not super likely unless you want to buy really cheapo houses, which I don’t recommend. But you could certainly do a two for one. So and I’ve done that many times. Nice. Good. Good for you. Oh, yeah, we’re working on. Well, I wish you and Gina the best of success. We appreciate your business and a appreciate having you to his clients and keep up the good work and we’ll see you at the next event. Happy investing. Thank you so much for listening. Please be sure to subscribe so that you don’t miss any episodes. Be sure to check out the show’s specific website and our general website Hartman. Mediacom for appropriate disclaimers and Terms of Service. Remember that guest opinions are their own. And if you require specific legal or tax advice, or advice and any other specialized area, please consult an appropriate professional. And we also very much appreciate you reviewing the show. Please go to iTunes or Stitcher Radio or whatever platform you’re using and write a review for the show we would very much appreciate that. And be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.
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