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Investing In Farmland With Elise Alexander – Real Estate Women

REW Elise Alexander | Farmland Investing

 

One of the leading asset classes available to investors today is investing in farmland. This is because farmland offers a diversified investment opportunity with attractive long-term returns. Today, Elise Alexander, the Vice President and General Counsel for AcreTrader Inc., joins Moneeka Sawyer to give us a closer look at farmland investing and how it differs from traditional real estate investing. She also talks about its benefits and the several ways you can earn from it. If you’re thinking about diversifying your investments and making passive income, tune in!

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Investing In Farmland With Elise Alexander – Real Estate Women

Real Estate Investing For Women

I am so excited to welcome to our show, Elise Alexander. This is what Elise says about herself, “I am the VP and General Counsel for AcreTrader Inc, which is an Arkansas-based platform that enables fractionalized ownership of farmland and allows investors to earn passive income starting online in just minutes. Our mission is to empower our customers to buy and sell land smarter with advanced technology, data and expertise. I grew up on a farm and ranch in Crawford County, Arkansas. In addition to my role at AcreTrader since 2003, I have served as President of a large family office, managing several companies and providing legal counsel to portfolio companies as well.” Elise, welcome to the show.

Thanks for having me on. I’m excited to talk to you.

I’ve been looking forward to this show because we’ve never had anybody come on and talk about farmland. What an interesting topic. Thank you for coming on. Could you give us your high-level story? How did you get into this kind of investing?

I grew up on a farm and ranch so I had exposure to farmland. Fast forward a few years, my brother who’s a money manager at a large banking firm, wanted to invest some family money in some land. I thought, “I don’t think this is a good idea. We won’t be able to get our money back.” It turns out he was right and I was wrong. We’ve invested in farmland independently of the AcreTrader job over the years and done pretty well at it.

I was at least familiar with the asset class when I met Carter Malloy, our CEO and Garrott McClintock, our COO. It is unique and has different aspects. We’re going into why it’s different than traditional real estate investing and a good alternative in a way to diversify your portfolio. We aren’t investment advisors so we can’t give investment advice but we can talk to you about farmland and tell you how to invest in different ways through AcreTrader. I’m excited about the asset class.

Talk to me a little bit about how you got involved with AcreTrader specifically.

It was through a mutual friend who approached my brother in his job and said, “These guys are a startup. They’re looking for equity to start the company and grow.” Through that conversation, we found out they were looking for legal counsel. I had gotten a little bit less busy managing the family side of things and was looking for my next opportunity. My first thought was, “This seems simple. Why has nobody thought of this?”

My second thought while looking at the quality of their slide deck was, “They already have a lawyer involved. They probably don’t need me.” That led to a phone call and another in-person meeting in late February of 2019. We hadn’t even yet launched our first farm. I fell in love with the concept. I liked Carter and Garrott. There were maybe 3 or 4 other people on the team at that point. I was like, “I these guys. I feel at home with them. Let’s go.” It’s been like this ever since.

Talk to me a little bit about how farmland as an asset class is different from other asset classes and other ways to invest in real estate.

It’s different than just investments in stocks or bonds. For example, it’s not correlated to the stock market. If you have a fluctuation in the stock market, it generally doesn’t affect the value of the farmland, which is nice. There’s also a relative lack of price volatility in the price of land. There have been some downturns in the US in the past several years in the values of farmland but much less so than other asset classes. There’s a real long-term appreciation of the value of farmland.

NCREIF is an organization that tracks a lot of land statistics. Their main statistic is that the average annual return for farmland is about 11% to 12% over the last several years. If you look at the USDA Statistics who published the cumulative annual growth rate of farmland in the past several years has been about 5.9%. You can earn money with farmland in a couple of ways. One is you get annual distributions from the rent on the farm and then also that long-term appreciation that we talked about.

Another benefit to farmland versus other real estate assets is it has a pretty stable tenant base. You have a lower default rate. If these farmers don’t own the land and they’re a tenant on your land, they want to be there. They’re spending time, energy and money. They’re putting fertilizer in the soil that is good for more than one year. They’re real salt of the earth people. Certainly, farms fail but it happens in industry and business anyway but the default rate is lower. The farmer has a bad year. He or she is not necessarily going to move off and say, “Sorry, I’m not paying my rent.” They pay rent, not monthly but in advance of their growing season. That helps as well.

One of the things I loved about AcreTrader in the business model but also farmland is there’s a real social good that I haven’t been able to benefit from in any other business or job I’ve had. We’re preserving the assets. Farmland disappears at the rate of 2.9 acres per minute in the US. We lose it to development. We’re also ultimately helping feed people, not just in the United States but also in the world. That feels good to me as opposed to pushing some paper around the desk.

I know a lot of farmers. One of the biggest criticisms we get about our business model is, “You’re just buying farmland and driving up the price.” The asset class is huge but there are a lot of ways that we help young farmers as they’re growing their business. They can’t afford to buy land. We buy it for them and then lease it to them. Our investors partner in a way with that farmer to help him or her grow their operation. There are a lot of different ways I could describe that but that’s the general benefits that I see in distinction from traditional real estate.

Do your homework, do your due diligence, and don’t just rely on something somebody told you.

I’d like to hear a little bit more of those details. First of all, you are renting to small farmers. Why don’t you tell me a little bit more about that? Who is it that you’re renting to? Go into a little bit more of those benefits.

Some of our tenants are large corporate-type farmers. For example, we have a couple of tenants who are repeats in different areas and some have organic farm operations. To be certified organic land has to undergo this long process. You can only use certain types of products on the land to enhance it. There’s a lot more that goes into that if an organic farmer is going to ask you for a longer-term lease. Some of those are larger operations. Some of the tenants we have are young farmers who are starting.

They may have only a limited amount of capital. They need that to buy farm equipment, the fertilizer, the seeds and things like that to go into the farm. They don’t have enough credit maybe to get leveraged to buy the farm. They’ll bring us a good farm. We’ll do our process to review it, give them an option to purchase it at the end and lease it to them. That’s one way in which we help large farmers.

The farming generation in the US is growing older. Sometimes people pass away and maybe their children don’t want to farm. Maybe they have 3 kids, 2 want to farm and the 1 just wants the money. It’s a good way we could buy that farm. Our investors could buy that farm from those descendants of a long-time farmer. The 1 who doesn’t want to farm goes away and the other 2 may want to lease it back from us and continue farming that same ground that their family has owned.

There are a lot of ways that we help farmers if we refer them to resources that they may not know they have access to. It’s not just us trying to buy land and benefit from it. We view it as a partnership with farmers and try to help them. We have tools that we provide to them and data that we try to make available to them and resources. How do you find a good CPA that knows how to account for farming and things like that? It makes us feel good. They’re great people. We get to meet new people every day. That’s fun too.

Farmland is disappearing at this huge rate. How does that affect your business? What do you guys do?

It affects our business in a couple of ways. I wouldn’t say that we would never convert farmland to commercial development. For example, we buy farms in Illinois and Chicago continues to spread out. There are commercial developments near where we are. There are wind farms on some of our farms that our investors own. Generally speaking, buying that farmland and continuing to engage in the farming business through our tenants preserves the farmland for being commercially developed for that period.

Sometimes it can make buying farmland more challenging. If a commercial or a development company is interested in the same piece of land, we want to put it on the platform and allow investors to invest. That can drive the price up. We try to make sure that we are purchasing farmland at a price that provides for appreciation over time and the investors can benefit. Other things that affect farming and farmland are commodity prices and what’s the going rate for rent in that area. There are a lot of factors that go into deciding whether a farm might be a good investment.

Overall, the fact that a lot of farmland is going away to development doesn’t hurt our business model but our population and the need to feed people is going up. Some farmland is used not for growing crops but for grazing livestock which also goes toward feeding people. At this point, we haven’t had any farms on the AcreTrader platform that is used for livestock and grazing. We are hoping to expand our offerings to include things solar and timber. There are a lot of different ways to make money through farmland that isn’t always growing soybeans, corn or apples.

What I’ve heard about farmland is that the small farmers getting shut out and the big farmers are all coming in and buying a ball of land or doing all the production. It sounds to me like your love is with the smaller farmer. Am I understanding that correctly?

We love all farmers. Ultimately, we’re going to lease a farm to the person or group that has a proven performance history. What does their yield data look like? Are they financially sound? Are they known in the community to be good people and people that we would enjoy working with for a long period? More of our tenants are smaller farmers.

The bigger corporate farmers do a great job at farming sustainably and having a lot of good practices in place. Those larger farmers have more ready access to capital. If they need a line of credit for their operations or to buy more farmland, it’s easier for them to do so. Some of the smaller farmers have less access to capital. Statistically, it means a lot of smaller farmers are tenants. If there was, we don’t prefer one over the other when leasing.

When you’ve got a lease, how long does the lease usually last? How long do you write the lease for? When do you normally sell? What’s the longevity of those contracts? Part of why I’m asking that question is that as an investor, we’re getting whatever it is every single year. Do we ever get to take advantage of the equity growth in that? What does that look like?

Most of the holding periods on farms re-estimate between 5 and 7 years. If you purchase shares in an entity that owns farmland through the AcreTrader platform, most of those hold periods, we think 5 to 7 years is about the sweet spot. We have the ability to sell the farm sooner. Investors earn an appreciation in this passive income model in two ways. They’re getting a part of the cash that’s generated by renting the farm from the farmer. At the end of the life of the farm, when we decide, “The markets are good,” we have an offer on a farm.

REW Elise Alexander | Farmland Investing

Farmland Investing: Benefiting ourselves upfront at the expense of the investors is not a good way to build a relationship. We want them to trust us and we want to behave with integrity. That’s what being in business for a long time is about.

 

However that comes about, we pay the closing costs and the commission for the sale. Everything that’s left comes back out to the investors in that LLC or LLP that owns the farm pro-rata based on how many shares or membership interests they have in that farm. Investors get annual income and then get to share in the long-term appreciation. AcreTrader doesn’t take a carried interest. We do charge farm management fees annually. We have an affiliate that’s a real estate brokerage that gets a commission. Otherwise, we try to leave the bulk of the appreciation available to investors.

What is a minimum investment into any of these properties? Does it differ?

It varies by type of farm. The other type of farms besides row crop farms are soybeans and corn. Those are 5 to 7-year whole period. A permanent crop farm would be an orchard where they grow nuts, almonds, pistachios or apples. Those types of farms have a longer whole period. The reason for that is if it’s a new planting, it takes a while for the trees to grow enough.

It takes time to begin producing the fruit and then to reach full maturity where the farm is the most profitable and therefore, a better candidate for a sale or a liquidation. Those periods are more than 10 to 15 years on hold. AcreTrader is new. We’ve sold one farm so far. We have some others that we’re looking for or receiving offers on at the moment. We consider seeing if it’s economically viable and it’s a good outcome for our investors when we look at, “Is it time?”

You do a management fee annually. What does that look like?

That is 0.75% of the fair market value of the farm. The fair market value of the farm can go up over time so that the dollar amount of that fee could go up. Investors don’t receive state invoices or anything like that once we’ve collected the rent and the AcreTrader management fee. We have an affiliate that’s called AcreTrader Management, LLC. That’s the entity that does the farm management. Out of those fees, we may also contract with a local third-party farm manager.

That’s no additional expense to investors but that’s somebody who is a professional farm manager. They have boots on the ground. They’re there looking at the farm, talking to the farmer and making sure they’re being sustainable using good farming practices. Those fees are covered by the AcreTrader, the management fee. We get the other things we do for that fee, paying the property taxes if there are improvements to be made on the farm like the irrigation equipment breaks or we need better drainage on the farm.

We would supervise those and work with the farmer to make sure that his or her farming was not interrupted. We pay the property tax on the farm and get general liability insurance on the farm. It’s truly passive to investors. After they’ve made that initial investment, they get to sit back and receive their cash distributions across the platform back into their wallet. We do the tax and accounting reporting annually as well.

First of all, if we’re going to do passive investing, we have to pay a management fee. That’s par for the course. Your management fee is low. It’s not even 1%. You do an awful lot for a low percentage. That’s amazing to me. In residential, we might pay management fees of 8% to 12% to 15% of rents. It’s a little bit different. You’re doing it on value. In residential, we do it on rents but it seems to cover quite a lot. I love that.

We want people to love the asset class too. We’ll still make money. We’re thinking long-term, big picture. We don’t want to benefit ourselves upfront at the expense of the investors. That’s not a good way to build a relationship. We want them to trust us and behave with integrity. That’s what being in business for a long time is about.

With regards to payments out annually, in syndication, we have a term that’s day one payouts. How soon after the investor invests do they start getting payments out?

Usually, if we purchase a farm in the first six months of the year, the first payouts would come in December of that year. What can happen in farmland after June 1st-ish is farmers have started planting and preparing the ground. After that, if I bought a farm in August, I likely wouldn’t receive rent on that farm until the following year. Some leases are split between payments between March and November. That coincides with starting the process of planting and once they’ve harvested.

To answer the last question you asked which was lease term, it varies by farm and land. Sometimes the leases with the farmers are a year. Sometimes with the organic farmers might be 3 to 5 years. Sometimes they have rent escalation. Some of our leases are cash where they pay us a set rate. Some are cash with some flex lease component, which means they pay a base amount of rent. Depending on if the farm performs and the yields are higher than certain levels, the investors may also get a piece of the crop rent or the crop production and the sale of that.

To circle back to the question you asked about rent on day one, in some cases with the more permanent crops too, the disclosures on the site will tell you, “You can expect to restart receiving payments,” and then the timeframe. On permanent crops, if it’s a greenfield operation where it’s bare land, we had to go through and somebody’s got to plant trees and install irrigation, it could be three or more years before you start receiving cash distributions. As an investor, you’d want to know that upfront.

The time you spend becoming more educated pays dividends. Just keep learning, reading, and keep asking questions.

Do you start accruing your interest from day one? When do you start accruing the benefit?

We don’t accrue interest. For example, on a farm, if for whatever reason a farmer did default and didn’t pay rent, you wouldn’t get distributions that year. There’s no accrual for that. One of the good things about AcreTrader is we vet the tenant base in the area. We know if something did happen. If a farmer for whatever reason had to default on the lease, we know there would be other tenants there available. Depending on the time of year that happened, we could get another farmer in who would start planting and there could be some distributions that year. There’s no accrual and catch-up from an accounting sense.

I visited your site. When you talk that it will make on average 12% a year, you’re including that there are years that you may not pay anything. Is that true? Give me a little bit more of a breakdown on that.

Our model doesn’t provide for a default. We don’t include the fact that any certain year you might not get written but it’s very conservative. We base that estimated yield or annual IRR based on the same base rent at the beginning of the lease. We don’t factor in any escalation and rental value in there because it’s hard to predict upfront. We would rather people have realistic expectations and then surprise them if we do well. Appreciation and rental rates would serve to probably offset any year in which you didn’t get rent but there could be a year that you did not receive a cash distribution into your wallet.

A couple of things that we want to talk about in EXTRA is Elise is from AcreTrader. I’m going to let you know exactly how to get in touch with her. There are many different ways to buy farmland. We’re going to be talking about that in EXTRA. I’ll probably ask Elise a few more questions as they come up for me. I’ve never had a conversation about this asset class, which is fascinating but I also don’t know what to ask. I’m sure that conversation will be juicy. We will do that in EXTRA.

Before we move into our three rapid-fire questions, I want to let how to find out more about AcreTrader. Go to BlissfulInvestor.com/Farmland. That will go to their homepage at AcreTrader. There are resources to learn more. You go to the Resources tab. There are opportunities. If they’ve got any investments that they’re taking investments on, that will be listed in investments. You can get on their newsletter so that you can find out more information. There are a lot of resources on that webpage. Did you want to add anything else regarding the webpage, Elise?

I’m sure your readers are familiar with accredited investors’ status. At this point, our offerings are only open to accredited investors. We hope to broaden that at some point in the future but at this point, it’s only accredited.

What is the minimum investment you can get?

The lowest are usually somewhere between $8,000 and $10,000. Depending on the farm and the price per acre, that could be more than one share. Each offer will tell you what the minimum investment is required and what number of shares that gets you. Sometimes we have sponsored offerings that somebody else finds and sources the deal. They bring it to us and pay us a fee to use our platform. In some of those, the minimum could be $25,000 or $35,000. The highest we’ve ever had is maybe $50,000. We figured out that was too high. If you watch our site, there’s something for everybody in a range.

Go to the site and find out more at BlissfulInvestor.com/Farmland. You can get all sorts of interesting information about AcreTrader and farmland. Thank you so much, Elise. That was amazing. Are you ready for our three rapid-fire questions?

I’ll do my best.

Elise, tell us a tip on getting started investing in real estate.

The main thing is to do your homework and diligence. Don’t rely on something somebody told you. Don’t be afraid to ask questions of anybody you can find.

What would you say is one strategy for being successful in real estate investing?

REW Elise Alexander | Farmland Investing

Farmland Investing: Continue to learn about the asset class you’re interested in. You can make a more informed decision if you understand the nuances of how the market works with respect to that asset class.

 

It’s continuing to learn about that asset class that you’re interested in. You can make a more informed decision if you understand the nuances of how the market works with respect to that asset class. It pays dividends, the time you spend becoming more educated. Keep learning, reading and asking questions.

What would you say is one daily practice that you use that contributes to your success?

It’s being mindful and intentional about taking the time. We all in the workforce are busy. Take that time, allocate it and be true to it to do the learning. That sounds like a broken record but it does matter.

It’s been so fun to chat about this on this portion of the show. Thank you so much.

Thank you for having me. I enjoyed it. I could talk about farmland all day.

Ladies who are subscribed to EXTRA, we are going to be talking more about farmland and specifically different ways to invest in farmland, not just AcreTrader so you’ve got some different resources. If you are not subscribed but would like to, go to RealEstateInvestingForWomenEXTRA.com. You’ll get this episode and many others. The first seven days are free so you can check it out.

For those of you that are leaving us, thank you so much for joining us. This was an interesting conversation. I hope you enjoyed it as much as I did. I look forward to seeing you next time. Until then. Remember, goals without action are just dreams. Get out there, take action and create the life your heart deeply desires. I’ll see you soon.

 

Important Links

 

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To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

To see this program in video:

Search on Roku for Real Estate Investing 4 Women or go to this link: https://blissfulinvestor.com/biroku

On YouTube go to Real Estate Investing for Women

 

Getting Started In Real Estate Investing With Stephanie Holleman – Real Estate Women

REW Stephanie | Real Estate Investing

 

Want to start investing in real estate but don’t know where to begin? Then this show is for you. In this episode, Moneeka Sawyer talks to Stephanie Holleman, an IO psych business management, interior design sales, and real estate investing specialist. Stephanie imparts her experience and knowledge on how she shifted and started a career in real estate. She also provides helpful tips on improving your skills, choosing your business circle, and how to work efficiently. Discover these and more, get started on that journey, and begin to see results!

Watch the episode here

 

Listen to the podcast here


 

Getting Started In Real Estate Investing With Stephanie Holleman – Real Estate Women

Real Estate Investing For Women

I am excited to welcome you to the show, Stephanie Holleman. This is what Stephanie says about herself, “As a single mom with a creative mind and four cool kids, I’m constantly seeking ways to improve myself, my work skills, and pass on my zest for life. It’s difficult for me to sit still, and I find the most joy in spending time with my little people who aren’t so little anymore outdoors, playing in the water and using my noodle to solve problems. I have a background in IO Psych, Business Management, Interior Design Sales, and Real Estate Investing. I nerd out over personal development and business development books, and I love people. It has been a fun ride so far, and I love using the skills I have gained along the way to aid in changing lives.” I love that bio. Stephanie, welcome to the show.

Thank you.

Nice to meet you.

Nice to meet you too.

I know you worked for Zack Boothe, who we have had twice on this show. The first time I met him, he reached out to me from the blue. I didn’t know him. We chatted, and while I was impressed with his heart, capacity, and the business that he’s built, I was excited about the fact that he talked about wholesaling, which is something that my ladies have asked about a lot. I have to make a confession. I believe that wholesaling is buying another job. It’s not investing. It’s getting another job. It’s not something that I’m passionate about or even ever wanted to try but that doesn’t mean that my ladies don’t have a right to take a look at it.

It’s an amazing way to get started, and I have seen what Zack’s done with his business, where he doesn’t have to work. It’s taken some time to get there like any business. I have been impressed with what he’s done with his own life and business, how kind he is, and how committed he is to his students, so I brought him back on the show.

It was funny because I have been looking for another wholesaling mentor that’s a woman. I have had a couple of women stand me up on the show, literally three times no shows, not calling me back, being disrespectful in ways that I would rather they not be disrespectful to me. How we do anything is how we do everything.

If you are disrespectful to me, you are going to be disrespectful to my ladies. I loved how on target he is. He responds to everything I ask. He gives me everything I needed and was great on the show. I thought, “This is the guy I would like to introduce to my ladies.” I brought him back, and then he was like, “You need to meet some of my lady students there, and my right-hand person is a woman too. You need to meet her.”

I’m delighted to be speaking to you, who is his righthand lady. I love it. Other than his wife. He’s crazy about his wife and stuff but it’s sweet. Thank you so much for coming to the show and helping my audience to understand a little bit more about how Zack’s systems work and how it might benefit my ladies.

Thank you for having me. This is exciting.

Tell me a little bit about your background because this one is all about you.

I feel like I was in the right place at the right time when I landed this gig with Zack. As a single mom, I went back to school several years ago to get a degree in Industrial-Organizational Psychology, which is what IO Psych is. I then switched to Interior Design. Long story short, which I absolutely loved but my goal was to use my interior design skills to start flipping houses.

I knew that real estate investing was more lucrative and would get me to retirement more quickly but then, when I started learning about real estate investing, I learned it didn’t have much to do with interior design at all. The more I learned about it, the more I loved it and wanted to switch over to the industry full-time. I was looking into learning from Zack and found him on social media. I watched his $40,000 in 40-day Challenge.

REW Stephanie | Real Estate Investing

Real Estate Investing: When you get to make choices, you choose people that are going to support your dreams and support your capacity to achieve those dreams.

 

I’m glad you mentioned that because it is inspiring. It’s BlissfulInvestor.com/40days. Ladies, write that down. Go check it out. It’s awesome.

It’s good. It’s inspiring, and it gives you a lot of good golden nuggets about wholesaling and getting into the industry. I was following Zack on social media, and he posted a video about recruiting someone to help manage and structure sales for him. I reached out to him, and the rest is history.

Instead of taking his course, you decided to work for him. That’s how much he impressed you. Is that true?

Yes. You see him on his videos and talk to him but he’s even better in person. That sounds cheesy but it’s so true.

Tell me a little bit about what it’s like working for him. What happened next?

Working with Zack enriches my life. They say that you become the five people with whom you surround yourself. Even before I knew him and what he was like, I wanted to surround myself with people like him. When I started working with him every day and his team, they were all rock stars. We know him and what he’s like if you have seen his videos. He’s hardworking but very supportive and positive.

He’s a big goofball. He’s so fun, positive, uplifting, inspiring, and successful. He knows how to get there. What we don’t see in his videos that I get to experience and his students every day is that he’s very good at teaching those things. He’s good at teaching core values, hard work, and all the things that he does. He teaches it well.

You said something key that I want to highlight for my ladies, which is you become like the five people that you spend the most time with. This is important. It’s important in our personal lives and in our business, too. If in your personal life, everybody around you says, “You can’t do real estate. That’s scary. That’s risky,” or whatever it is, as much as you may believe in it, you are going to start believing it. You can’t help it.

The people that are around us influence us. They influence how much we smile, cry, and believe in ourselves or the businesses that we are going into. We can’t always choose family. A lot of us spend a lot of time with family that doesn’t get it. What’s important is to then when you get to make choices, you choose people that are going to support your dreams and the capacity to achieve those dreams.

We talk a lot on this show about getting a mentor. Stephanie is talking about she has this mentor that supports her life, core values, the way she wants to do business, and feels positive. Those are all things that are good to have in our businesses or work. I feel fortunate. My husband is the ultimate example of bliss. He lives his life in constant joy. He will not compromise on that, to the chagrin of many people. I love that that’s his highest priority. For me, that’s something that supports my goals in life.

Every single mentor that I brought into my business has also supported that focus on bliss. They don’t tell me things like, “Moneeka, do you want it enough?” That is not going to work for me. It’s, “Moneeka, this will support your bliss, and this is how.” A mentor needs to understand what my highest values are. This is what I’m learning from you about Zack and what I love. It’s a beautiful example for my ladies of, “If your core values are such as such, make sure that you are finding a mentor that supports that.” Wouldn’t you agree?

Yes, 100%.

This next question that you sent that I love makes me cringe. You said, “Do you love talking to people on the phone, and why?” I hate talking to people on the phone. Talk to me a little bit about that. I don’t hate it. I love talking to my ladies, please don’t get me wrong but it’s not my favorite thing to do just being on the phone.

Not every conversation is hearts and rainbows. There are some people that are very difficult to talk to.

It can be scary. When I first was offered the position by Zack, I was asked by my closest family and friends, “Are you going to like this? Are you going to be happy talking to people on the phone all day?” Before this, I was an interior designer and called myself the Utah Pinball. I was all over Utah all day, every day, and I loved it. As I said, in my bio, “I can’t sit still.” When you talk on the phone, you have to sit in. I have to sit in my office and talk on the phone all day long. That was a question that I had as well. However, everyone is so different. I talked to people from all walks of life of all different experiences and levels, and it’s like being a phone pinball.

I talk to people all over the country and even outside of the country who want to get started on their investing careers, which is also very inspiring. I’m becoming the people with whom I surround myself, and it’s not only five people. Honestly, I talk to people all day long who inspire me, who are entrepreneurs, who want that time and financial freedom. I get to tell them how to do that.

How Zack can do that for them? It’s extremely rewarding, and it’s a lot of fun getting to know people, talking to them, and hearing about their lives and goals. It’s breathtaking every single day. Not every conversation is hearts and rainbows. There are some people that are very difficult to talk to but for the most part, it’s very inspiring and fun.

There are a couple of things I want to highlight. First of all, ladies, this is one of the key points that I have the biggest challenge with is calling people. I wanted to talk to Stephanie a little bit more about that, how she gets herself psyched up, what she does to prep for her calls, and those things. We are going to be talking about that in EXTRA. We are going to do a deep dive on cold calling in EXTRA. She will give you a lot of details around that.

The other thing that I wanted to highlight is that she mentioned that it’s not by people, it’s that she surrounding herself with people that inspire her. We have talked a lot on this show about networking or going to groups. We have had Deborah Razo on here, who’s built a community, Women’s Real Estate Network. She’s built a community of women that are inspiring and there to support one another.

We have had several conversations about where can you go to surround yourself with people that uplift and inspire you around real estate. Who is it that you can have engaging, uplifting conversations that say you are on fire about real estate? Start looking for those on Meetup, REIAs, and WREN. You can check out BlissfulInvestor.com/wren. Take a look at where you can spend time. It’s not the five people that you are dependent on. You have an entire community of people that help to uplift you and help you succeed.

Thank you for mentioning that because it’s so important on these levels of what our relationships. We’ve got our top five that we spend the most time with, then we’ve got our community, the places where we spend most of our time with, and the people that we have most of our conversations with. There are a lot of different people. When you get a phone call from one of my ladies, what is your goal in talking to them?

My goal is to give them all the information they need to make an educated decision as to whether or not Zack is the right fit for them as a coach. Attempting real estate investing on my own in the past, I learned very quickly that we can’t do anything alone. We need that community that we were talking about. Zack is a good coach. He’s there for people. He has a tried-and-true system and he gives to you everything. My main goal is to give all of his potential students or candidates, all the information they need so that they can decide if that’s right for them or if they need to move on to a different type of coach.

Different coach or strategy. No strategy is right for everybody. I’m a buy-and-hold person. Wholesaling may not be right for me but buy and hold may not be right for you to anybody who’s reading. Maybe wholesaling is a place to either get started or invest all of your energy into. I always say there are a million ways to make a million dollars in real estate. Not all of those million ways are going to be good for you. If Zack is the right guy or wholesaling is the right strategy, those are some things that you want to look at.

You also want to look at the core values. Make sure your core values and personalities match up. The lead generation and exit strategies, and the goals that you have for your business in your business model, that’s huge when choosing a coach.

How much detail about their experience do you need to know? What is it that they are going to be bringing to the table for you?

All of it. I need all the experience. I want you to hear all about their backgrounds, stories, and goals. As I said, I talked to everyone from all walks of life in all experience levels. I would be talking to a young lady who’s 18 or 19 and on fire about life and wants to be successful right out of the gate but only knows that the concept’s barely in real estate investing. I want to hear all about that and why and what they know about the concepts.

Sometimes I will talk to someone who has been wholesaling for 30 years, and they are very successful and want to add another lead generation strategy. They see Zack and what he does, what he can do, and want to duplicate that. I talk and ask them. We dive deep into their experience. I talked to everyone in between those as well. I want to hear about all of it. That’s part of what I love.

REW Stephanie | Real Estate Investing

Real Estate Investing: Pick one lead generation strategy, one exit strategy, and be consistent.

 

Do people need to have a lot of experience in real estate or any experience to do this? Tell me a little bit more about that. Honestly, what do they need to come to you with?

They don’t have to have any experience whatsoever. They don’t even need to know about the concepts. People book a call with me because they understand that real estate investing can give them time and financial freedom, and anything beyond that, Zack will teach them. They don’t have to have any experience whatsoever.

What ignited my curiosity is that he was talking about wholesaling and was like, “I might buy ten properties and then keep two as long-term rentals,” which I’m like, “I could get my long-term rentals for cheap,” because that’s my strategy for this long-term renting. You can also marry this strategy with other strategies that you might be interested in. You’ve got to start somewhere. A lot of people are like, “I don’t even know where to start. I’m embarrassed to make that phone call because I don’t know anything.”

Zack teaches you how to cherry-pick the best and wholesale the rest. You will hear him say that.

You are comfortable talking with real beginners who don’t know anything.

Yes, all levels.

I love the example of the person that has been wholesaling for 30 years, too. It is nice that you have spoken to that huge range. You have an understanding of what those conversations feel like and what they need. How long does it take a student to get started, and what are their first steps?

It only takes a couple of minutes. I create an account for them right then and there. As soon as that account is submitted, they immediately get the course in their inbox and instructions on how to connect with Zack. When you get onboarded, you get Zack’s personal cell phone number, which is crazy. He hasn’t missed a call from his students the entire time that he’s been coaching. He’s always there for people.

You get all of that within minutes. The next step is to go to your email inbox and click to get into the course and onto the Facebook group that’s for his students only. What I do is I ask the new students a photos of themselves so that I can send their photos and introduce them to our team. If anyone needs anything, we are all here for them. We can put a face with a name, and we all know who we are talking about.

I will send their phone number to Zack, and he will give them a call within 24 hours to introduce himself and get to know them, their goals, their business model, and everything. In that way, they have his cell phone number. They can save it on their phone and call or text him whenever they have an urgent question, deal on a line or anything. It’s very simple and quick. Quite frankly, a lot of fun.

Once they do all that stuff, what do you feel is typically the time that a person might need in their schedule to follow the course work and take the steps, and how quickly can people start to see results?

Zack’s course is designed for people who might be facing from their full 9:00 to 5:00 job into their own wholesaling business. You can spend as little as fifteen hours per week on it. That’s everything from education to taking action to closing those deals. If they are doing it full-time, they can spend more time, and Zack will tell them exactly where and how to spend that time to make it most efficient.

Is it the stuff you can do on a weekend or do you have to do it during business hours?

When you start investing in real estate, don’t try to do it alone because you’re going to make many expensive mistakes and spend a lot of time trying to figure out how to make it work.

No, you can do it any time of day or night, evenings, weekends, or whatever time works best for people.

How can people get in touch with you to learn more?

They can book a call with me. They go to BlissfulInvestor.com/stephanie. We are hiring a new onboarding specialist because we are busy. I can’t handle all of it myself. We are bringing someone on board. We offered them the position, which is exciting. They will be talking to me or the other person. We will then dive into everything so that you can make a good determination whether or not we are a good fit.

That is BlissfulInvestor.com/stephanie. Go check that out and give Stephanie a call or sign up with her. That would be amazing. For EXTRA, we are going to be talking about how to make these phone calls fun so that we love them as much as Stephanie does. Stay tuned for that because that’s going to be an amazing, awesome conversation that I personally need. I’m excited about it. Stephanie, are you ready for three rapid-fire questions?

Yes, I am.

Tell us one super tip on getting started investing in real estate.

Get a coach or mentor, whether it’s Zack or someone else, don’t try to do it alone because you are going to make a lot of expensive mistakes and a lot of time trying to figure out how to make it work.

What is one strategy for being successful as a real estate investor?

Pick one lead generation strategy and one exit strategy, and be consistent.

What is one daily practice that you do that you would say contributes to your personal success?

A lot of positive self-talk. This world is filled with a lot of negativities. We have bad days and even some bad times during our good days. Sometimes it takes a lot of positive self-talk to work ourselves and power through those crazy times and be positive.

I absolutely agree on that one. Ladies, thank you so much for joining Stephanie and me for this portion of the show, we do have more in EXTRA. We are going to be talking about getting on the phones and making that fun. If you are subscribed to EXTRA, stay tuned, if you are not, go to BlissfulInvestor.com is my website.

If you want to sign up for EXTRA, go to RealEstateInvestingForWomenEXTRA.com. You get the first seven days for free. Check it out. Thank you so much for joining Stephanie and I for this portion of the show. If you are leaving us now, I look forward to seeing you next time, and until then, remember, goals without action are just dreams. Get up there, take action, and create the life your heart deeply desires.

 

Important Links

 

About Stephanie Holleman

REW Stephanie | Real Estate InvestingAs a single mom with a creative mind and four really cool kids, I’m constantly seeking ways to improve myself and my work skills, and pass on my zest for life.  It’s difficult for me to sit still and find the most joy in spending time with my little people (who aren’t so little anymore) outdoors, playing in the water, and using my noodle to solve problems.  I have a background in I.O. Psych/Business Management, Interior Design, Sales and Real Estate Investing.  I nerd out over personal development and business development books, and I LOVE people!! It’s been a really fun ride so far, and I love using the skills I’ve gained along the way to aid in changing lives!

 

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To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

To see this program in video:

Search on Roku for Real Estate Investing 4 Women or go to this link: https://blissfulinvestor.com/biroku

On YouTube go to Real Estate Investing for Women

 

The Magic of Leverage With Wendy Papasan – Real Estate Women

REW Wendy | Magic of Leverage

 

When do you discover your purpose in life? In this episode, Wendy Papasan shares how you can leverage living the best life you possibly can. Wendy enjoys teaching and guiding young adults to figure out what they want to do in life, which empowers and inspires them to become big thinking leaders in the future. Listen as she provides examples of carefully grasping the things you are good at so you can reach your goals and grow!

Watch the episode here

 

Listen to the podcast here


 

The Magic of Leverage With Wendy Papasan – Real Estate Women

Real Estate Investing For Women

I am so excited to welcome Wendy Papasan back to the show. She leads the top real estate team in Austin, Texas. Prior to getting into real estate, she was a stay-at-home mom making no income. For over a decade, the Papasan Properties Group at Keller Williams has helped more than 1,600 families totaling more than $600 million in home sales.

In addition to a real estate business, she is a Cofounder and chairman of the board for Her Best Life. I can’t wait to hear more about this. It’s a million-dollar startup that helps women build big businesses and even bigger lives, which she’s done for herself. She’s also a co-host of the award-winning podcast Empire Building.

As an activist active real estate investor for many years, she’s passionate about helping others understand how money works and how to build wealth. A community activist and philanthropist, she is active on the board of KW Kids Can, a nonprofit that helps young adults think bigger and find their mission. She and her husband have helped raise more than $1 million for children with cancer. I hope you can see why Wendy and I are so alike. We have so many of the same values.

In her spare time, Wendy enjoys trail running, spending time with her family and international travel, and so do I. She is married to New York Times bestselling author and Keller Williams Vice President of Strategic Content, Jay Papasan. You guys know that I love talking about the book, The ONE Thing, and that is what Jay Papasan co-authored. They are the proud parents of two children and a dog named Taco. I love our conversations. We were sitting in the green room just chatting away and I can’t wait for Wendy to share with you ladies all this cool stuff she’s got going on.

Thanks for having me back.

It’s a pleasure. It’s nice to see you again. I love that you are the woman that likes to talk about leverage. Leverage is the magic to life. The two things that you talk a lot about are leveraging time and money. When I talk about money and time, both we never have enough of but money, we can always get back and make more time we cannot. Time is the ultimate commodity as the thing that once it’s gone, it’s gone.

It’s also a great equalizer. That’s the thing that everybody has the same amount of every single day. We all have 24 hours in a day and how we use it.

That’s what you are good at, is how do we use it? Let’s start by talking about leveraging time and then we’ll move into leveraging money. Does that sound fun?

That sounds great.

Talk to me a little bit about how you see leveraging time and what does that look like for you and your business?

The gift that I got when I started my real estate business was my kids were 3 and 5. I had been a stay-at-home mom for five years. I wanted to continue having a relationship with my kids. I leveraged myself right away, which was I got some help on the contract to close side pretty much from my first deal. That taste of leverage helped a lot.

For me, I was very committed to picking up my kids. I worked part-time my first couple of years in real estate. I was picking up my kids at noon and that compressed the schedule. It made me appreciate this idea of leverage because a lot of people, when they start out, they have too much time in real estate. They don’t know what to do all day long. It forced me to focus on the things that matter most and that’s the key to leveraging your time. It’s understanding what your priorities are. A lot of people wander around and they don’t understand what their priorities are.

 

The key to leveraging your time is understanding what your priorities are.

 

Talk to me a little bit about that. How do you define those priorities and how do you create the leverage required to live by those priorities?

I’m pretty clear about my mission and my mission is to empower and inspire big thinking leaders to create lives of abundance. What my mission does for me is it’s a filter for the choices that I make with my time. A lot of people don’t understand or know why they are on this planet. I strongly believe that everybody’s here for a reason. If you don’t know it, then it’s your job to go out and figure out what it is.

Let me give you an example. If that’s my mission and somebody says to me, “Can you teach a class to young adults on helping them figure out what they want to do with their life?” that’s an easy yes for me because my mission is to empower and inspire big thinking leaders to create lives of abundance.

If somebody says to me, “Will you be on the board for Austin Pets Alive!?” a local animal shelter, that sounds like fun. I do love my dog and I do love animals. However, it’s not in alignment with my mission. For those of us that have a tendency to say yes too much, raise your hand. It’s all of us because we want to do it all and have it all. It’s a nice filter because every yes is literally a no to everything else.

What I love that you talked about that there is that, it would be fun, there are a million fun things that each of us can do. What would it be like if we said yes to the things that were fun, but that were also aligned with our mission? The filter of it would be fun can certainly be there, but it has to be also aligned with a couple of other things in your life. For me, it’s all about core values. I talk about it more in that perspective. Talk to me a little bit about how you came up with that mission statement that defines the yes or the no.

I have an easy framework and it’s an exercise that we usually do over the course of an hour. I’m going to have to give you guys the short version of it. Take a piece of paper and draw a line down the middle of it. On the left-hand side, you want to write down all of the things you are passionate about. Moneeka would write travel, real estate investing, helping women, all these different things, and other things you are interested in. Baking. Maybe you are a baker. I don’t know. On the right-hand side, you write down the things you are good at.

For instance, you would write down communicating, podcasting, talking to people, getting the best out of people, whatever it is, these things that you are good at, and then you make what I would call a through statement. For instance, Gary Keller’s mission statement is to help people live the best life possible through teaching, coaching and writing. It’s an easy framework. That’s his number one passion.

You want to go back to those lists and narrow it down to your top three. You are not going to have seventeen different things. That makes no sense. You are not focused at all. It’s your passions on one side, what you are good at on the other, and then you make a through statement. Moneeka’s mission in life is to help women live their best lives through podcasting or whatever it is. I don’t want to put words in your mouth.

I see how you got through with that. It is to have women live their best lives through real estate and to do it blissfully.

I created your mission statement and it’s one sentence.

This is the other thing. I have worked with coaches before and they are like, “You got to put together a mission statement that will make you cry every single time or get teared up with passion every time you read it.” We would put together this paragraph and we worked on it for months. We came up with this thing and yes, every time I read it, I got tingles. I knew this was it, but when I’m trying to make decisions on where I’m going to spend my time, I’m not reading that. I know that it’s one sentence that captures the essence of everything that I stand for.

I would say take that mission statement, tape it up on the wall in your office and understand that you are not married to your mission statement. You are dating it. We are all dating our mission statements. I’m sure your mission in life has changed and evolved as you’ve grown as a person. As you are looking at it every day, you are thinking, “I’m going to tweak this. I’m going to do that. I’m going to change that.” You look up one day and it sticks.

 

REW Wendy | Magic of Leverage

Magic of Leverage: Our mission is to empower and inspire big thinking leaders to create lives of abundance.

 

Even if it sticks now, in a year, you may have to evolve it again. I love that clarity on that. You have your mission statement and you basically leverage your time based on if this is going to forward my mission or if this is aligned with my mission. I’m a yes, and if it doesn’t, I’m a no. Is that true?

Yeah. For a lot of the extracurricular stuff. For those of you that are reading, if you are working out a job, you are not necessarily going to be aligning all of your work. I would encourage everyone to be at a job that aligns at least with their values or their mission statement, but it’s also important to understand that the way you become more successful in this world is you run towards the things that you are good at and you leave everything else behind, which is what leverage is.

An easy way to do that is to think about what I would call your not-to-do list. Take a piece of paper, tape it to your desk, take a Sharpie and write, “My not-to-do list,” on top of it. This is for every single person reading. Every time you’ve got that feeling of, “I don’t want to do that,” or you put something off, you put it off again, you put it off for the third time, that then goes on the to-do list. When your to-do list is full, you got your piece of paper. When that’s full all the way down to the bottom, then you’ve got a job description for somebody else.

Hopefully, that person wakes up every day and they are thinking about their mission and what they love to do. It’s what’s on your not-to-do list. You can then continue to fire yourself from the things that you are not good at and your role gets smaller and smaller. In some ways, your life gets bigger and bigger, but your role gets smaller and smaller and you get better and better at it, and that’s what success looks like, doing a deep dive into the things that you are good at.

Honestly, women, a lot of times, are good at all things. We are too capable. We are good at this and that, and we keep all that stuff because we are pretty good at it. What ends up happening then is you never become an expert on anything, and that is how you will get paid the most from your work. It’s when you become very good at it. Nobody who’s good at everything ever got paid a large sum of money. That’s not how it works.

I’d like to give a little perspective on that because I know people that run businesses. This is in tech. It’s a little bit different than real estate. Even in real estate, they are in tech, they are a consultant and they run the whole show. They are a one-man shop making $1 million a year, but they run the whole shop, which means they are working fourteen hours a day. The relationship with their children is not as good as they would like it to be. They are up at night thinking about all the things that they need to do, so they are not getting rest. They are getting heavy and unhealthy. They have got all these other things. They are able to do everything and they make a lot of money.

There are two things that I’m trying to say here. There’s a huge sacrifice that we make in life to do everything. You are not leveraging your time that way. You are basically trading time for dollars. I have had this conversation. If I’m doing all of those things, so I’m working fourteen hours a day and I make $1 million a year, I’m making this much per hour.

First, it’s, “I make this much as a consultant.” No. Divide it around everything, and this is what you are making per hour. They are like, “I’m making $2,000 an hour.” That’s pretty good. What if you paid someone $500 an hour to do those jobs? You now have a better relationship with your kids, you are able to work out, you are not working as hard. You might take it up to $2 million a year because you are not so tired. Your brain is more fresh and you focus on the things you have expertise in and growing that expertise.

You are also not going to burn out and you are not going to look up after your kids have left the house and be filled with regret.

We can be successful doing it all. Some of us are that good.

I think you can have it all. I just don’t think you can do it all.

What I’m saying is to take a look at that because there are a lot of different ways to look at the cost of trying to do it all yourself. It’s not monetary either.

 

Move away from scarcity to an abundance mentality.

 

Even those people that are doing it all, I still believe that they got help. They might have help at home. They’ve got a housekeeper. They are probably leveraging some part of their life.

They have to, otherwise, they’d be on the road and never taking a shower. It’s more a matter of like focusing on what it is in your business. I love the way you talked about the not-to-do list. I’m going to use that. That’s so good. We have talked a lot about leveraging time. Do you feel like you got anything else you want to give us before we move to leveraging money?

I do. I think that for a lot of women, especially, leverage starts at home. No matter where you are, you get to leverage the things at home that you don’t want to do. My friend Via always says, “Kids don’t remember who made the dinner. They remember that you all sat down together as a family and had dinner together.”

Especially for women, if you think about it, we are only 50 years removed from our mom’s generation, who couldn’t even have their own checking account. It’s a very short time. There are a lot of feelings that we have as women. We are sexist about ourselves. It’s impossible to be a woman in America and not be sexist, even if you are a woman, because you have beliefs about what women should do. That’s part of where the guilt comes from. We feel like we should do everything that these moms did in the ‘50s and then also be a professional working mom and it’s impossible to do without burning out. You got to do your not-to-do list at home first.

I want the ladies to sit with for a minute because that is not something we talk about. You’ve heard from me. I have a wash and fold to do my laundry. It costs me $125 every time I do it. I go every two weeks. They hang up all my husband’s shirts. They put together all my socks, do all my laundry, and do my red separately because I wear a lot of red. They know how to work for me. It’s $125. That’s 10 to 15 loads of laundry. How much time would I have spent washing, drying, and hanging it?

Folding and putting away. You probably still have to put it away.

We still have to put it away unless you’ve got an organizer. I’ve got that too, but the putting away is a fraction of the time of doing all of those other pieces. What do you get to do with that time? You don’t have to work. This is the other thing. You don’t have to work with that time that can turn into leisure time because you do serve breaks.

You could get a hobby. What’s a hobby?

Leisure time or time to cuddle with your dog or your little person or go to a soccer game. Whatever it is, it doesn’t have to turn into work time. Just because you are leveraging your personal time, it does not mean that it has to turn into work time. It has to turn into your type. Whatever you choose to use it for. I do the wash and fold thing.

The other thing, my husband, when we got married, he promised me, “Moneeka, you will never scrub a toilet as long as you live with me,” and we were dead broke. We made nothing in those early days. We still had a maid because that was a high priority for us. During COVID, when the maid wouldn’t come, I put in this little pill into the tank and the toilet was staying awesome. My husband did the toilet. He promised me I would never scrub it. I thought a lot about it. It was a year and a half later when he finally admitted it.

Moneeka is like, “Haven’t you guys tried these things? They work amazingly. My toilet was never clearer. I don’t even know why I got a housekeeper.”

My husband is like, “No.” It’s one of those things. Even when things have been rough for us, I don’t always have a wash and fold, but I always have a house cleaner. I hate to say that we have rights and we deserve them. Those aren’t words that I like to use it often, but ladies, we should take care of ourselves.

 

REW Wendy | Magic of Leverage

Magic of Leverage: Everybody’s here for a reason. If you don’t know it, then it’s your job to go out and figure out what it is.

 

You also can put other people to work. It’s weird. In America, we feel like we have to do everything ourselves. If you go to other countries, it’s an obligation as you are building wealth to put other people to work. It’s super weird what we do here. We feel like we have to do everything ourselves and I can tell you firsthand, you can have a big impact on people. My housekeeper’s from Ecuador. She owns three investment properties in Ecuador because she’s been my housekeeper for many years. I’m always talking about this stuff, so she ended up buying three investment properties herself. You can have a big impact on the people in your world as well.

You are making jobs. That’s for sure. You are helping the economy, all of those things. I totally love that. Thank you for bringing that point up. It’s so important. Let’s move to leveraging money. Talk to me about what it means to you and some of your strategies around that.

I grew up in a small farming community in Northern Minnesota. I would say it was lower middle-class. A lot of my extended family was farmers. The idea of real estate investing, owning your own business, anything like that was very weird and nobody leveraged anything. My great-grandmother worked on a farm her whole life. She ran the family farm for many years. She shoveled her own walk until she was 97.

This is in Northern Minnesota, where it snows eight months out of the year. The mentality was that you do everything yourself. I can remember when I joined Keller Williams, I was a real estate investor first, and then I became a realtor. I started to understand this idea of moving away from scarcity to an abundance mentality.

I realized that money is flowing freely through the universe. I believe that. I know there are some people reading that are struggling and you may not understand that, but it is true. There are lots of money out there. The trick is to understand that there’s always enough money, and the amazing thing about real estate investing is you get to leverage money to create more wealth.

Unlike any other investment, you get to buy something at a fraction of the cost and complete strangers pay your mortgage off for you. You tell people, for instance, from Russia. You say, “You can buy a property for 20% of what it’s worth.” They look at you like, “What? My family had to save forever to pay for 100% of the property.”

Foreigners come here and they are like, “Why doesn’t everybody own ten properties?” I’m like, “I don’t know. Tell me why.” It’s crazy. The idea of leveraging your money, imagine purchasing Tesla stock and calling up eTrade and saying, “I want to buy 100 shares, but I can only afford 20.” eTrade is going to be like, “No. You can’t do that.” You get to do that in your business, too, because you get to leverage money in order to make more money.” That’s leveraging money.

I’d like to emphasize. We talk about leverage a lot on this show. It is my favorite topic but let’s go into it one more time. Leverage is simply you taking a small amount of money to control a large asset and to get the benefits from the asset. I hear a lot from people, “I don’t want to be a slave to the bank.”

You can choose. You can be a slave to whoever owns the majority share of your asset or you can be a slave to your landlord. One will kick you out and the other will not when their life changes. Who are we a slave to? That feels a little bit negative. I don’t mean to make it sound like you are always a slave, but when people use that leverage, I’m saying that.

It’s more like choosing your hard. I tell people. People are like, “It’s hard to buy investment properties and being a landlord.” It’s not, but it can be hard, but it’s also hard if you wake up and you are 85 and you don’t have any assets or any income. That’s hard too.

You wake up one day and your landlord says, “I’m selling this property. You need to be out in 30 days.” That’s hard. I love that. Choosing your hard, and also choosing our easy. These things are hard, but understand that on the flip side of that, there’s an awful lot of easy. There’s an awful lot that it gives us. When we talk about leverage, don’t be afraid to do 20% down and then someone else is paying for the rest of it because now you are taking 20% of the risk. They are taking 80% of the risk. You get 100% of the benefits. You get 100% of the hard, you get 100% of the easy, and you get 100% of the growth, and that’s how you create your life.

Here’s another way to think about it. I tell my real estate clients who have young children, “Would you like to pay for college $0.20 on the dollar?” They are like, “Wait, what?” “Your son is three. You are going to buy an investment property. You are going to put 20% down. You are going to put it on a fifteen-year note and in fifteen years when your kid is eighteen, complete strangers will have paid the 80% off. You’ll have an asset free and clear and you can sell it. Your kid can go to college or take an equity line. Never sell a good asset. That’s what Warren Buffett says.

 

The amazing thing about real estate investing is you get to leverage money to create more wealth.

 

Keep it and get an equity line that’s cheap and let it keep growing for you.

It’s for refinance.

I have never heard it that way before. I love that. Anything else you’d like to say about leveraging money?

I think we are good.

One of the things that I love about Wendy is how concise she is. She knows her life and she knows how to say what she wants to say.

Leverage done.

You ladies know that we are going to do EXTRA right after this. I asked Wendy what she wanted to talk about, and she got asked to speak at Inman. She’s going to be talking about self-care, mental health and that sort of thing. It’s important that we take a look at when we are talking about leveraging time. Sometimes we don’t remember that the single most important asset that we have is our own health, and our mental health is a big piece of our health in so many ways. This mental health thing, there’s a little bit of a stigma sometimes with those words, but it’s so important.

Especially now after COVID, we are lonely. We have spent a lot of time alone. We spent a lot of time hearing about other people’s pain, even if we have got our own pain. Sometimes we feel guilty that we are not as in much pain as other people, so we don’t ask for help. We don’t admit that we need help. We don’t admit that we need to take care of ourselves.

There is a lot going on for us, especially as women, because we care so much about the people around us. We forget that the single most important asset is our own health. I asked Wendy to share with us what she’s going to be talking about at Inman and so she’s going to be talking about that at EXTRA. Do you want to add anything else before we move on?

I would say that if you don’t take time for your wellness, you will have to take time for your illness.

We’ll be talking about that EXTRA, and then I know that you have a special gift. She’s offering this for us. I’m so excited. She’s like, “I just got in touch with my ladies so we can do these for her team.” Tell us about the gifts from my ladies.

I have a new startup that I have been working on for a couple of years now. It’s called Her Best Life. It aligns perfectly with you and everything that’s in your heart. It was started because we wanted to amplify the lives and voices of women in business. I believe that it can be leadership lonely. It can be hard to run your own business and to be at a party maybe with other moms in your neighborhood and not be able to have a connection because they are talking about, “It’s so hard to go to Target.” Maybe you are talking about that too and run this $5 million business I have got over here.

 

REW Wendy | Magic of Leverage

Magic of Leverage: The way to become more successful in this world is to run towards the things that you’re really good at and leave everything else behind.

 

We started this business with the idea that it can be leadership lonely for women, and it’s called Her Best Life. You can go to HerBestLife.com. We have several memberships and one that we are launching is our Net Worth Club. For those of you that don’t know what net worth is, it is the number that you should be focusing on in your personal life.

It’s like your personal P&L, your personal Profit and Loss statement. A lot of times, we focus only on the income, the top-line revenue, but we don’t focus on the profit, which is the sum of all of our assets. Net worth is everything you own, all your assets minus all your debt. We are launching a club where we track our net worth, but we track it together. We meet once a month. We take turns sharing information that’s of value.

Sometimes we talk about cryptocurrency and having the right insurance for your business. Sometimes we talk about real estate investing. It’s all the things. It’s $25 a month. It’s a low price because this is my passion and I want everyone to be able to get in there and do this because I believe that this one habit of tracking your net worth is how my husband and I have built a lot of our wealth.

You can go to NetWorthClub.com and type in the code BLISS and you guys can get three months free. It’s a $75 value. If you are not into it, you can jump out. This is something only for you guys. It’s something we invented before we started. I was reading my email from Moneeka’s team and it said, “If you have something to offer.” I was like, “I do have something to offer.” I hope you guys can join us.

It’s three months free, and then if you love it and you stay, it’s only $25 a month. It was so cute because I was asking Wendy, “What’s the price afterward?” She was like, “There’s no obligation afterward. If you don’t love it, you don’t stay.” It’s interesting because I hear this all the time. It’s because I asked this question, “What is one daily practice that you do?” People will talk about their daily practice.

Every once in a while, someone in the green room will say, “Do you know what my monthly practice is?” That has led to all my success and it’s tracking their net worth. It’s not tracking their profit and loss. It’s not tracking what they did right or wrong. Although, they do those things. Successful people do those things, but the thing they feel has built their wealth the fastest is being aware of their net worth.

It’s true for us and it’s a practice that we have practiced for many years. It’s crazy. It’s old.

No. You’re not old. We’re the same age.

You have fantastic skin. There you go.

Thank you. Are you ready for three rapid-fire questions?

I’m ready.

Tell us one super tip on getting started investing in real estate.

 

If you don’t take time for your wellness, you will have to take time for your illness.

 

This is a little self-serving, but I honestly believe it’s true. I had someone who was on the operations side of my team. She had her real estate license and she hemmed and hawed about getting into real estate. I said, “You need to sit down with so-and-so,” who is the best industrial realtor on my team. This person on my operations team had been looking at into buying an investment property for eighteen months.

She sat down with the investor realtor on my team and, within six weeks, was under contract. My tip is to get in touch with a realtor who does investing, if you are a realtor yourself. Even if you are a realtor yourself and you don’t do investing, hire someone because they will give you the confidence you need to pull the trigger. It’ll be the best money ever spent.

Focus on getting a realtor who does investments. Not deals with investors, but as an investor themselves is the very best. What’s one strategy for being successful in real estate investing?

This is not a tactical strategy, but being it for the long haul. This office that I’m in, I bought this house before I was a realtor in 2006. I bought it off Craigslist. It’s darling. When I bought it, I didn’t even know what I was doing. It’s two bedrooms. It’s 670 square feet. It’s tiny and on a busy street. One of the bedrooms doesn’t even have a closet. I would never tell one of my clients to buy it and I bought it for $135,000. I added on 750 square feet. I moved my office in here and I have probably made a couple of $100,000 on it by owning it for many years. Whatever decision you make in real estate, ten years in the future looks pretty good, even if it’s a poor decision.

It is a strategy because I like to tell people that mindset is a strategy. How you manage your mind, the way that you look at your life and your business is a strategy. It’s the most foundational strategy. It’s where everything begins. Being in for the long haul. You and I are so aligned. It’s so true. Ladies, she’s got a live event. Contact her. Find out what that’s all about.

We are sold out, but we are going to get you a ticket.

Her Best Life is on October 26 to 28, 2022, in Scottsdale, just so you know what’s going on. Tell us one daily practice you do that contributes to your personal success.

This goes back to our conversation about wellness. The thing that contributes to my success the most is getting up. I’m up at 5:00 and I’m working out with a trainer in my gym at 5:30. I do that three times a week. I have been doing that for many years. I do it with my husband. Several years ago, it was a very expensive proposition for us to do that. Honestly, it’s still pricey, but that habit allows me to do everything else. I’m up early. I get a lot of things done. By noon, I have packed more into my day than most people do in a week. It gives me the energy to do what I need to do every day.

Thank you so much for everything you’ve offered on this portion of the show. It’s amazing.

My pleasure.

I can’t wait to talk in EXTRA about self-care, mental health and us ladies, how we can prioritize ourselves so that we are able to do all the things in life we want to do. We’ll talk about that in EXTRA. If you are not subscribed to EXTRA, please go to RealEstateInvestingForWomenExtra.com. You can subscribe there. You get seven days for free. Check it out.

If you are subscribed, stay tuned. We have got more. For those of you who are leaving Wendy and I now, thank you so much for joining us for this portion of the show. I hope you found it as amazing as I did. I look forward to talking to you next time and until then, remember, goals without action are just dreams. Get out there, take action and create the life your heart deeply desires. I will see you soon.

 

Important Links

 

About Wendy Papasan

REW Wendy | Magic of LeverageWendy leads real estate teams in Austin and Houston, Texas, as well as Minneapolis/St. Paul, Minnesota. After just 10 years in the business, she has sold more than 1000 homes totaling more than $325 Million. In addition to her real estate business, Wendy owns multiple income-producing properties, and is a partner in a Memphis real estate office.

She is a sought-after real estate speaker coach aligned with MAPS, who consults with agents across the country. She is particularly passionate about seeing women succeed in business and helping everyone grow their wealth. A community activist and philanthropist, Wendy is chairman of the board of KW Kids Can, a non-profit that helps young adults think bigger.

Last year she raised $150,000 for Heroes for Children, a Texas nonprofit that helps children with cancer. She also helped raise $30,000 for Community First Village, a master planned community that provides affordable, permanent housing and community for the chronically homeless in Central Texas. She is married to New York Times best-selling author and Keller William’s Vice President, Jay Papasan, and they are the proud parents of Gus and Veronica and a dog named Taco.

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To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

To see this program in video:

Search on Roku for Real Estate Investing 4 Women or go to this link: https://blissfulinvestor.com/biroku

On YouTube go to Real Estate Investing for Women

 

Driving For Dollars: Taking A Leap Of Faith With Zack Boothe

REW 105 | Driving For Dollars

 

What do you feel when you start something new? Is it excitement for the promising outcomes or fear for the possibility of failure? Often, when we start driving for dollars on a completely different territory, we are overwhelmed by the things around us, and these cause us to tumble down the road eventually. DFD Mastery founder Zack Boothe had his fair share of mistakes when he first got into real estate. In this episode, he sits with Moneeka Sawyer to share how he turned these mistakes into lessons and how he managed to conquer the real estate wholesaling industry. Listen in as Zack discloses the insider secrets you will need to make money in real estate.

Watch the episode here

 

Listen to the podcast here


 

Driving For Dollars: Taking A Leap Of Faith With Zack Boothe

Real Estate Investing For Women

I am so excited to welcome back to the show, Zack Boothe. We had him on the show a little while ago, and I fell in love with his strategy, personality, and values. I loved talking to him back then. I wanted to chat with him again, and I thought I’d share that conversation with you this time too. I’m excited to have him back on the show. For those of you that don’t remember him, a few years ago, Zack Boothe was a window cleaner. You can even find his window cleaning tutorial videos on YouTube with millions of views.

However, Zack always dreamed of being a real estate investor. Taking a leap of faith, he walked away from window cleaning. Within a handful of years, he was making over $1 million per year from real estate investing. With his successful business, he now spends his time helping others see how simple it is to make money in real estate. He is here to share his insider secrets to finding massively discounted properties, regardless of your experience level. Zack, welcome back to the show.

Thanks for having me.

Could you tell us your story again? It’s so engaging and fascinating.

I tell the story so much, sometimes I get deep into it, sometimes I don’t get as deep, but my business story is I grew up working because my dad required it. When I was eleven, I started working in the family lawnmowing business. When I was fifteen, I quit the family business and started working for others. I started framing houses and doing finished carpentry.

My dad grew up in a rough situation. He wanted me to become a man very fast. He wanted me to take ownership of my life. I love him to death and I’m so grateful for it because he kicked my butt. It was his way or the highway, but at sixteen years old, he cut me off financially. He said, “You’re a man now. If you want to buy anything, you got to buy it.” He paid for my housing and my food, and that was it. If I wanted to play high school basketball, go on dates, or buy a car, he wouldn’t even co-sign a loan.

At sixteen, I had been working a lot. I found at that point, trading dollars for the time was not possible. I didn’t have enough time to give to do all this stuff I wanted to do, to go to school, play basketball, and have some fun in my life. At seventeen, I started my first business, which was the window cleaning business. I remember the first day I made $100 in a couple of hours. I was like, “That’s $50 an hour. Holy crap.”

I remember the first time I made $1,000 in a day, and I grew that business for almost a decade. By the time I walked away from that business, I had 3 trucks and had 13 or 14 employees at one time. It was a great experience. I learned a ton, but the bigger I got, the less money I made. There was an optimal size for profitability. It was me, 2 or 3 other employees, 2 trucks, and that was it. I had brought on a partner at the time. Our vision for the business was completely different. I felt stuck. The big thing that pushed me over the edge to get out of that and to do something different was the day my son was born.

I remember the day he was born. I was so beat up because all I could worry and think about was how am I going to pay the medical bills. I was so upset about that because I wanted to be an amazing dad and be present for my wife. It was the most beautiful moment to be a part of and then I was mad at myself that all I could think about was the money.

People always say, “just love yourself for who you are,” but there’s more power in encouraging people to be proud of who they can become.

I was upset about the money and I was upset of myself for being upset about the money. It bothered me. I felt inadequate, like a failure, and like I was failing my family. I get emotional every time I say this, “I wanted to give more. My wife deserved more.” My wife believed in me. I remember telling her I was going to drop out of college and be a full-time entrepreneur. I was so afraid to tell her. She said, “That’s fine. I believe in you.” That was her response. There was no fear or doubt. I was like, “I have to prove her right,” and I wasn’t proving her right. I felt like I was not living up to the expectation that I had set for myself. Real estate was what I looked to change all that for me.

You said something that was so key here that transformed me at the moment. We set expectations for ourselves. Sometimes those expectations are based on the people that we love. She believed in you. You wanted to make her happy, but in the end, the only way to get to the place that you wanted to be was to be able to meet your own expectations.

I love that your wife totally trusted you. I love that you wanted to prove her right, but what you said that was so key here was you weren’t meeting your own expectations. Ladies, this is one of those things I want you to know, is that we earn our own right to respecting ourselves. We do that by keeping promises to ourselves and by meeting our own expectations and not lowering them.

That’s so powerful because there are so many people that will say, “Love yourself as you are.” It’s like, “Why don’t you encourage people to be proud of who they can become?” We all have so much potential.

I believe in both, love yourself as you are, and always understand that you have so much more potential. I love that word. Love yourself today and allow yourself to become an even better version of yourself by aspiring to that potential.

I look back when I took that plunge when I walked away from something that was semi-comfortable because I was doing it for several years, but it wasn’t fulfilling my needs and meeting my expectations. I took a risk and I went for something new. That journey of getting to where I am now brought a lot of confidence, self-respect, and happiness, I learned a lot about myself. I had to become a different person and become more of the person I wanted to become to accomplish those goals. One of the cool things is, did I love myself before? Yes. Do I love myself even more now? Yes.

We have that capacity. With the people that we love, your wife and child, you love them so much today, but you hope that tomorrow you’ll love them even more. It’s not true for everybody, unfortunately, but for those of us that want to live a blissful life, the path is to love yourself and the people that you love to death today. Love them to pieces and know that the capacity for that love to grow is huge.

Love yourself and those people even more tomorrow or the next year. That is the true path to bliss and experiencing love in that huge expansiveness. That’s what I teach. As blissful investors, our businesses create a path for growth. They create a path for learning about joy and learning to respect and love yourself.

I had that moment. That’s what pushed me into getting into real estate. I had to have a change. I wanted to change. I needed to change for more than anything for myself. It wasn’t easy. I made a lot of mistakes. I tried flipping a house and I lost a little bit of money, and I realized I hated that. I bought some rentals and did okay there. Even before my son was born, I had bought a duplex a couple of years before that. That went well. I was like, “I need to do more of that.”

REW 105 | Driving For Dollars

Driving For Dollars: Women set expectations for themselves that are sometimes based on the people they love. But they earn their right to respect themselves by meeting their expectations, not lowering them.

 

As soon as I decided to take the plunge, I had all these obstacles to buy another rental. They needed 25% down and debt to income. There were all these complications to scale. I was like, “How do I go from paycheck-to-paycheck window cleaner to a multimillionaire and making over $1 million a year? How is that even possible before I’m dead, let alone in the next 5 or 10 years?”

I finally found out about a strategy that made it possible, which I talked about in the last episode, is known as real estate wholesaling. It’s the concept that I can do some marketing. I can find someone that will sell their property at a discount and turn the opportunity for profit. I could pass the opportunity on as a finder’s fee for the money. I didn’t have to close on it, get debt, and take a risk. I just had to find someone that wanted the deal that I found.

I didn’t believe it was possible. I thought it was sounded too good to be true. It was like, “Why would anybody sell it that big of a discount that I could then sell it for at a discount to someone else?” I was trying to figure out, “Is this possible?” There are a lot of gurus, coaches, and stuff out there talking about this, but they’re selling courses. I was like, “Are they just selling courses or they’re helping people?” I had a lot of skepticism.

I was like, “I don’t know if I can trust this.” I took a leap of faith. I paid for a mentor for $10,000. It was a huge mistake, horrible mentor. Everyone thinks he would be like, “He solved the problem.” No, he didn’t solve my problem. He made more problems. I was even more skeptical. What happened was I had given up on the idea and I was back to washing windows.

I washed windows for a guy named Stan. He was a wealthy real estate developer. I’m cleaning his mansion. He’s an older guy. I had to know everything. We sat and talked for an hour and a half. He was the most kind-loving gentleman. He was pouring into me and telling me a story. I was like, “He’s an incredible guy.”

At the end of the conversation, I was like, “Stan, if I could find two rentals, it would be life-changing.” He was like, “That’s convenient. I got these two properties. I don’t want to deal with them. I haven’t collected rents in four months. I’ll sell them to you.” I was like, “How much?” He’s like, “$500,000.” I was like, “I can’t buy them. I don’t have cash. I can’t get a loan for that much,” which was at a massive discount. They were 1-acre horse properties. They’re worth $350,000 each. He was selling them to me for $250,000 each.

He’s like, “That’s fine. I’ll be the bank.” I’m like, “Okay.” He’s like, “Can you put 20% down?” I was like, “No, Stan. I can put $2,000 or $3,000 down.” He’s like, “Okay.” I’m like, “Holy crap.” He’s like, “Let me get the paper.” He goes and gets a white paper and he starts writing down the agreement. I was like, “Stan, hold on. Don’t we need an attorney to draft an actual contract?” He’s like, “No.”

He starts educating me on the process. He’s like, “You’re going to take this to the title company. You’re also going to check with a real estate agent and make sure that’s what they’re worth. You got to confirm that what I’m saying is true.” He’s educating me on how to get these good deals. That experience, long story short with those deals, I ended up doing a rent-to-own with the tenants. They both cash me out within two years. I made over $130,000 profit on those two properties.

It was amazing. I made a fortune. The more valuable to me than the money or the best part of this whole story to me was the a-ha moment that it’s real. It exists. People sell their property at a discount. There are educated people that will trade convenience for price. I needed to find more Stans in my life. I was like, “How do I find Stan? I need Stan on every street corner I walk on. How do we do that?” That experience made me start to believe it was possible. That was the very end of 2016.

You have to give to receive.

The next year, 2017, I started up trying again. It was almost a whole year that went by without finding a deal. I spent a bunch of money on marketing. I signed a $30,000 contract with his online digital marketing company that’s supposed to get me discounted properties. Not only did I never get a deal, I never even got a lead from them. They completely stole my money. That sucked and was very painful.

I made mistake after mistake. What changed everything is the very beginning of 2017. I met my mentor that changed my life. I met a guy named Cody Hofhine. He was business partners with Tom Krol. They were two coaches and they don’t coach anymore, but they taught me how to consistently find sellers that will sell at a discount, build a relationship, and do traditional wholesaling of selling the deal without ever having to close on it.

I joined their program at the beginning of that year and then everything changed. In that first eight months with them, I made over $100,000 profit. For the next twelve months, I made shy of $500,000. The year after that, $1.2 million. It’s allowed me to make large sums of cash, but to cherry-pick my favorite deals, pick up rentals, and it led me into coaching as well.

It led me into helping, serving, giving back, and contributing to other people. That’s why I’m on this show. I want to help, serve, give the gift that was given to me, and give the hope that Stan gave to me. I want people to realize that it is possible, not only to give them that hope but give them the tools and the action steps in what needs to happen to find that success.

It’s interesting because you continue to make a huge amount of money in the wholesaling business and you opted to teach. Talk to me a little bit about that transition because I know a little bit about the story. Ladies, what I’m getting at here is he has an established business, making a huge amount of money and he wants to start another business. Some things have to happen on the back end with that other business in order for him to start a new project.

I want you to see what he’s done and understand that you too, it’s important that as we go out there into the world, whatever business that you’re starting, you want to start it, make it successful before you move to anything else. If you’re spreading yourself too thin between too many things, you don’t get the levels of success that Zack’s talking about. He’s also a very successful coach, so he knows how to do this, but there’s a transition that happened. Zack, could you talk to me a little bit about that?

Becoming a coach was never a plan. I will give you the backstory of why I became a coach will make more sense of why I walked away from so much money. I lost a ton of money to become a coach. What happened towards the end of 2018, it was my second full year of doing wholesaling, and I was going to do shy of $500,000. My mentor, Tom Krol, was putting on a live event in Asheville, North Carolina. I went there, and I spoke. I poured out my heart and shared where I was making money, how I was doing it, and how I was finding these discounted properties. I had come up with a system and a process to do it well.

I felt like I had tapped out my potential, $500,000 a year. I was pinching myself. I was blown away. At that event, I met some people. One of the guys that I met invited me to do a self-help journal for the next year, 2019. The journal is called Living Your Best Year Ever. In that journal, the first 100 pages help you create three big goals for the next year. It talks about who you have to become to accomplish the goals and the kinds of things you have to do. One of my goals was to generate $1 million income that next year.

Reading that, I understood that I had to give away $1 million. It was basically what the principal was taught in there, “If I wanted love, I give love. If I want money, I give money.” You have to give to receive. I was like, “How do I give away $1 million if I’m trying to make $1 million? It’s counterintuitive, but I want to do this. How do we do this?”

REW 105 | Driving For Dollars

Driving For Dollars: By nature, women can be more endearing, and people find it easier to open up and be vulnerable to a woman.

 

I sat down with my wife, I was like, “How do we do this? I want to do this. I want to give back.” She said, “Why don’t you teach some people? You’re amazing at teaching. Why don’t you teach people what you’re doing to make $500,000?” I’m like, “You’re genius.” That’s what I did. I went to my mentor, Tom Krol. I said, “Tom, I need ten people that will implement my marketing system. Find me ten people. I’m going to teach them and coach them because I want to put $1 million into their business. It had everything to do with putting money in their business.”

He said, “First of all, 100%, you’re doing that. I love it. I’m going to help you. I’m going to find the people, but you’re not allowed to coach for free because they won’t take it seriously and won’t implement.” He made me charge him money first. It was only like a couple of thousand bucks. It wasn’t much, but we quickly got those first ten students. I started teaching them what I had learned and what I was doing. The craziest thing happened. The more I taught them, the more I realized how many holes I had in my business and all the mistakes I was making, which were very expensive mistakes.

I look back, it makes me cringe, but because of that, I made $1.2 million that year. It’s because of all the efficiencies that were put in place and what I learned from my students. The more valuable and even better than the money that I made was the love of coaching and the a-ha moment that, “This is what I want to do with my time. This is what I want to do with my life.”

My very first student, a few years later, texted me. He said, “I alone have now made over $1 million from what you taught me.” Michael McLeish in Greenville, South Carolina. Scott Dalinger, his very first deal with me made $113,000, quit his corporate job, and is making an absolute fortune still to this day in Portland. These original students were absolutely crushing it. I found so much fulfillment from it and I wanted to do more of it.

At the end of 2019, we did over $1.2 million and I wanted to go into coaching. I wanted to make that transition. I was still very much a big part of my real estate investing and wholesaling business. I had to find people and replace myself completely, so I didn’t even have to go on appointments. I wanted to keep the business running. The next year after, 2020, when I completely walked away from it, we only did $700,000 in income. Now we’re much higher than we ever were. This last year, 2021 was insane. We made a lot of money. I walked away from money to become a coach.

The first two years of coaching, the first year, I lost $8,000. The next year, I made $600 as a coach because of putting all the people in place to help support my students, infrastructure, marketing, and getting my name out there so I could make a bigger impact. I lost money to become a coach. I did it because I love it. 2021 was the first year that I did make money as a coach. I’m grateful for that because I’m getting paid to do what I love, plus my wholesaling business is blowing up. I’ve been doing this for a handful of years now. All of that money that I have made, I’ve reinvested it. That money is starting to snowball super-fast. I’ve passed the point where my passive income is well beyond what I spend each month.

I feel like I am more blessed than I deserve. It’s incredible because not only do I have complete peace of mind and freedom financially, but I’m so fulfilled by what I do and being able to help these students. That’s a long way to answer your question of the transition period of going into coaching and what that looked like. What it looked like was I walked away from money to get it off the ground. It was because I loved it, and it was what I was passionate about.

I love that passion in you. I love your commitment to helping people. The way that you started with a commitment to make people get $1 million into their businesses, that’s an amazing commitment to people outside of you. You didn’t necessarily know upfront how much you were going to benefit from that. Our students do always teach us. That’s a big blessing also in teaching. I know that they have improved your business and all of that stuff. I love watching how the passion started and now how you’re implementing that out into the world to help more people.

It’s been an incredible experience.

People who are successful in business sometimes forget that they run a business to live a beautiful life.

The two examples that you gave us were men. Do you only coach men? I know that’s not true, but talk to me a little bit about what your student makeup is like and what your focuses are.

Like any other industry, it’s predominantly men in the real estate space, mostly because the larger majority of people that are in the workspace are men, but yes, I have successful women students. You should have them on this show. They are inspiring. Jess is one of them. She’s incredible. As a matter of fact, she’s been a student for several months. I don’t think she’s hit the twelve-month mark. She’s by far the most successful student I’ve ever had in the first twelve months. She made my first twelve months in this space look like I wasn’t even trying. She’s crushing it.

I had her on my show and I interviewed her. This is off of memory and not going to be exact, but she has done around eleven wholesale deals. She found eleven deals at a discount and passed the opportunity on for a finder’s fee, no debt, no risk, and made well over $200,000 profit. She’s completed one flip and made $40,000 or $50,000 grand on the flip. She has two flips she’s working on, 2 or 3 properties under contract, and cherry-picked two deals as rentals. That’s in ten months working with me. She’s a freak of nature. It was super funny because I asked her, “How the hell do you have children and do this? How do you balance it all?” She’s like, “I don’t.”

What does that mean, “I don’t?”

“I don’t balance it,” she said. She was talking about the need of building out the team and having people to support her because she did all of this on her own, which is so crazy. She’s impressive. You need to have her on the show. I have so many. I feel bad even mentioning some because I’ll forget so many. Aaron and Mikayla, I need to mention them.

Aaron was a student first. He was a fireman in Southern California. He had done one deal on his own before he met me, joined my program, and he blew up. In the first couple of months with me, he made $50,000 or $60,000, quit his job, and went full-time. He was dating Mikayla at the time and she quit her job to start working with him. I started coaching those two, one-on-one as a partnership and helping them automate and build their business. They’re absolutely crushing it. I became close with those two and they asked me to marry them, which is cool.

In April 2021, I flew to Southern California and I had to get registered to be able to marry someone in California. I got to go marry Mikayla and Aaron. They’re a cute couple. Mikayla is a lot of fun. You should have her on the show. The thing is, I believe that women have more of an edge on men when it comes to this space. I’ll give you an example. All of our cold callers are women because it’s way less threatening when someone calls you and it’s a female. They feel safer and don’t feel like they’re going to be lied to or taken advantage of. Frankly, it’s hard to be mean to a girl.

Everyone knows what I’m talking about, by nature. I look at my little girl, Kate. She is so cute. The other night, she was constantly screaming over anything. She couldn’t find her little teddy bear. She was screaming bloody murder right before bed. I’m like, “Kate, stop screaming,” in a stern voice and look at her. She had these big puppy dog eyes. It was the cutest little face. It made me feel horrible for rebuking her.

She’s definitely daddy’s little girl.

REW 105 | Driving For Dollars

Driving For Dollars: Wholesaling takes a lot of work, but you do not need a ton of experience. You have to get in front of the right types of sellers.

 

She got me so wrapped around her finger. I was like, “You can’t scream. When you need something, you talk to me.” I’m trying to be way more sensitive and then I was like, “Guys, come give me a hug and a kiss.” I was hugging my kids and she lit up because she’s like, “He’s not mad at me.” She’s giggling while she’s hugging me. By nature, women can be more endearing. I find for myself, it’s easier to open up and to be vulnerable to a woman.

A lot of the times when sellers have a problem, let’s say they have a property they inherited and their brother’s a crackhead and lives in the back of the house and got a deathbed will and had the parents sign over everything to him. They now need an attorney to fight the brother. There are all these problems and you step in and say, “I can buy the house.” Now, you have to navigate and understand all these problems and get the sellers to tell you what’s going on and to help them through that process.

To be able to buy the property, it’s a lot easier to get that personal information and have those sellers open up to you when you have a relationship or when you’re close. Men can do it. I’m good at it. I’ve done it a ton and my acquisition manager is a man, but by nature, women if they’re willing to put in the work, they have a little bit of an edge because it’s easier for people, in general, to open up. By nature, you’re better listeners, read facial expressions, and have more of an ability to communicate.

It’s true. I know you’re trying to tap down a little bit because we don’t want to generalize too much, but I do think that it is one of those things inherently that we women have a little bit more of a default advantage. I don’t think it’s necessarily that we’re better communicators, but we’re different communicators.

I moved into a place and my business partner is living with my husband and I now because he’s trying to do some moving and remodeling. It’s interesting when either of those guys is having communication with me or when they’re having communication with each other. I’m like, “What happened there?” They sound like they’re grunting at each other. They’re got one-word responses and full communications are happening. When I come in, they can’t plan together with one-word communications, but I can do the whole planning and get the household running, all the rules, and all of that stuff.

It’s so fascinating to watch the complete difference in our capacity to communicate and the way that we build relationships. This was so much fun. Like my contractor, I’m doing a construction project and I asked him to come in and do some fixes in the house. I was like, “Is it all going to be done by the time I move in?” He goes, “It’s going to be when it’s going to be.” I was like, “Don’t ever say that to me. That stresses me out.” He says, “You don’t deal with stress well.” I said, “I deal with stress really well, just don’t talk to me that way.”

He talks to my business partner that way. They’re totally fine with it. Unlike me, I need to have an understanding that you’re going to get everything done that I need before I move in and that you will support me after I move in to get the rest of it done. That’s the communication that I need. It’s so interesting to see the difference. He totally switched it up to make me happy, but as women, we intuit a lot of that stuff. Sometimes we over-communicate, but then if we notice that, we tend to pull back also. Intuitively, I agree with you. We have an intuitive sense by default on communications and building relationships.

I was tap-dancing. You described what I was doing very well. I don’t like generalizing. It’s funny because my mom is a major tomboy. She is not like any other woman I have ever met. One example is she was pregnant with me when she shot her first deer with a bow and arrow. That’s my mother. A few years ago, I was in Idaho, and I went up to see my parents. We were doing this archery elk hunting thing. When I showed up at their camp at midnight, I had driven up, and I was going to crash in their trailer. They have a little base camp area. They were still awake and walking around.

I was like, “What are you guys doing?” My mom’s like, “I shot a bear. We got to go get it in the morning.” I was like, “You’re nuts. You’re crazy.” She’s 59 years old, running around the forest with a bow and arrow still. When I would mess up as a kid, she’d be like, “Steven, beat your son.” I don’t like generalizing because I know that women, there are all sorts of spectrums of personalities and communications types. Same with men, but in a general sense. That’s all I was trying to say.

You don’t want to freestyle dance before you actually learn the dance. You have to get those simple movements down and understand the footwork and what that movement intends to do.

It’s uncomfortable. I want women trainers for my women because we have an understanding of a lot of that stuff because of our default behaviors. We don’t want to generalize. There are many of us women that are living outside the boxes the same with the men, but we do have an inherent understanding and a lot of unspoken rules that women understand and men don’t understand. It’s a little disappointing to me, what comes with that is an expectation of that understanding also.

For instance, talking about wholesaling. First of all, I love that your program works. I love that you have very successful women in your program. You’re obviously able to be sensitive to their needs and communicate with them in a way that they understand and are able to create not little success, but a massive success. I love all of those things. I love that you’re conscious of their kids and the things that they go through, like Aaron and his wife, Mikayla.

There are different dynamics that happen with them. These are important things when you’re working with women, for you to understand that. I love that. I have tried to have five other women who teach wholesaling on this show. Not a single one of them has ended up being on the show. One of them stood me up five times.

One of them, I looked her up and she had a bad reputation in the industry. It’s like that. As much as I want women to teach my women, I also understand that business is business. As women, we have to understand that business is business. We have to be conscious, considerate, compassionate. We have to show up on time and for our people, and all other things.

I have a lot of great women that can teach it, but wholesaling has been such an interesting thing. I’ve literally been searching for a woman and can’t find one that will show up with the heart, promptness, and awareness of what’s required that you’ve been able to show up with. We can have conversations like we’ve had that I haven’t been able to have with any of these other women.

I appreciate you saying that. I’m going to make a confession though. I haven’t always been great at communicating with women. It has been a learned skill. There was a book I read that changed my life. It was called How to Improve Your Marriage Without Talking About It. For a time in my life, I wouldn’t work with women. I didn’t know how to. I served a Christian mission in San Paulo, Brazil, when I was a young man and I had leadership responsibilities. I worked with women and men. I struggled to communicate with some of the women in leadership positions there and so forth.

Even though we were trying to do good for the community, there was conflict. I didn’t understand why they were so frustrated with me. I’m like, “No doubt. I’m an idiot.” I read this book. It not only helped my marriage, it helped me be even more madly in love with my wonderful person, with my wife, Karen, but it helped me understand how I process information, communicate my fears and insecurities as a man and then the same thing with women.

There are different spectrums, but it allowed me to understand how to communicate, encourage, and be a better leader. I have a lot of women that work for me. My right-hand gal that helps me talk to all of the people that want to become students is a woman. She runs my sales floor. She’s incredible. Her name’s Stephanie.

This is something that I had to learn and figure out. I wasn’t born with the understanding of the differences between men and women. When I got on your show and talked to you about being on the show again, we talked a lot about that. We talked a lot about how I truly want more women students. I want to help more women. I feel like I am capable of doing that and I want to do that.

REW 105 | Driving For Dollars

Driving For Dollars: If you find a leader and a teacher you can trust, give them everything you have.

 

The reason that I’m having you back on the show is that you’ve been able to help women produce these massive results, and encourage the rest of their life. When you were talking about the one woman where you’re like, “How are you balancing this?” She’s like, “I’m not,” but you are now able to understand she needs to balance that because her kids need to be a priority for her. She knows that. You have the experience to help her to put together the team that will allow her that freedom. You understand the value of that.

People that are successful in business forget that the reason we run a business is to live a beautiful life. We don’t live our life to run our businesses. That’s a big distinction. I don’t know if this is true for all women, but the women in my circle, that’s a big distinction. We run our businesses to live our beautiful life. I love that you’re able to tap into that and help them and create that life based on those values. I want to ask you, who is it that you can help most? Do they have to have a lot of experience to get started in wholesaling?

Not at all. You don’t have to have any real estate experience at all. Wholesaling’s one of those businesses where you have to get in front of the right types of sellers. You have to communicate with them and get a signed contract. The process is quite simple. It’s not complicated. It is work. There’s a lot of work that takes place, but you do not need a ton of experience.

You will need to have money for marketing and some time to put into it. I won’t even coach. I do have some requirements because if I bring on a student, I want to be able to make them successful. I found that there are a handful of things that they have to commit to for me to be able to help them. I could go through that. The first one is a personal thing. If I coach someone, they have to be willing to share their success story. They have to be willing to be on the podcast because I want them to pay it forward.

I’ve had a lot of students at the beginning that I coached, who made a ton of money, but they were insecure or shy and didn’t want to be on the podcast. I was like, “You’re not paying it forward.” That’s a personal requirement of mine now. If you don’t want to be on my podcast after I help you make a ton of money, don’t apply. I coached to make a difference. If they won’t help me pay it forward and talk about their success, I’m going to spend my time and efforts elsewhere. That one bothered me.

The next one is you have to put enough time into this. I require at least fifteen hours of work. I tell my students exactly what and what has to be done, and when. There’s no question what you need to do, but you need at least fifteen hours per week. You need to be able to put at least $500 a month in marketing at a bare minimum. I’ll tell you where and how to spend it. It’s not coming to me. It’s going out to find sellers.

Lastly, when you joined my program, I didn’t want you binge-watching the content. One of the things you’ll have is my personal cell phone to go over deals when we have deals on the line. You also will have coaching calls with me on a group call like on Wednesday, a Facebook group, and a community. You’ll have ongoing support, but there’s a course that comes with it, a step-by-step course, A through Z setting you up and getting you started.

I have certain students that will binge watch everything and do nothing because they feel overwhelmed. They feel like they don’t know what to do next. That’s now a requirement. You’re not allowed to watch video two until you’ve implemented action step on video one. It’s not an education program. It’s an action-step implementation program. My goal is to make you money. Remember, I started off to put $1 million in people’s businesses. I learned that there were certain action steps that had to take place. Over years of doing this and a few years of coaching, over 300 people, you have to implement a certain series of action steps.

One of my requirements is no binge-watching content. You implement as you go. If you get stuck, confused, or if you feel like you need to move on because you had a lead come in or something, and you don’t know how to negotiate it, then you can call me or text me. I’ll tell you where to go in the program, but I don’t want you binge-watching content. That’s a requirement because it’s going to screw your progress if you don’t do that.

There will be many times when you’re uncomfortable, but one day you’re going to look back on your uncomfortable journey and be so glad you did it.

The last requirement is when you join my program, I need you to trust me. I need you to do exactly what I say. I have found that sometimes students feel a little insecure still and they think that they need to listen to podcasts and watch YouTube videos and do a hybrid of what I teach and what someone else’s teaches.

When you join my program and you do what I tell you to do, it’s my responsibility that you’re successful. I need you to do exactly what I asked you to do and not reinvent the wheel and lean on me. I want you to be laser-focused on the action steps and not do a hybrid, but do exactly as I ask you to do unless you talk to me and I tell you to do something different. Those are the exact requirements that we will go over when people jump on and are curious about our program.

It doesn’t mean that you have to be doing the program exactly this way forever, but you do need to learn a successful strategy first. You can adjust it later when you’ve got enough experience to know what might work better for you, but in the beginning, it’s all hypothetical. If you find a leader and a teacher that you can trust, then give them everything you got. After a few years, depending on how quickly your success comes, you can start to adjust once you’ve got enough experience to make those adjustments. You don’t want to freestyle dance before you learn the dance.

You got to get those simple movements down and the fundamentals.

The basics and understand the footwork, understand what that movement is intending to do, and then you can do some freestyle.

My goal is I want you to do a wholesale deal. The average time to do your first wholesale deal with me as a coach is three months. An average deal is $30,000. It’s a chunk of money to be able to make. I had someone that got upset with me, and I was telling him this. I was like, “No, I need you to follow the action steps.” He’s like, “I want to do it like this. This is how I want to do it.” I was like, “I need you to not reinvent the wheel.”

He’s like, “You’re arrogant. You think you know everything.” I was like, “I want to help you.” This is something I do every day, all day. I’m obsessed with it. I love helping my students. Not only am I teaching this and seeing it implemented all across the country and seeing what works and doesn’t work, but I do this in two different markets.

I make well over $1 million a year doing what I’m teaching. I’m teaching in theory. I didn’t go to college and get a doctorate’s degree and then taught what I understood. I implement, use, study, and I have actual data proving what I do and why I do it. I give them those exact processes. It’s simple. The processes, action steps, and none of the videos are over seven minutes. I don’t brag about how many hours of video. It’s not very much. “This is the action step 1, 2, 3.” You go through the program and implement the action steps. It will be a lot of work. There will be a lot of times where you’re uncomfortable. You’ll be having conversations that you probably never had before.

You might not know someone will say something and you’ll be writing down the word because you don’t know what the word means to google it later. There are going to be moments like that, but I look back on my uncomfortable journey and I’m so glad I did it. I want my students to say the same thing. I look back to what Tom Krol and Cody Hofhine did for me. I want to do that for my students. I want to pass on the legacy that Tom and Cody had. I want to make a difference.

REW 105 | Driving For Dollars

Driving For Dollars: Women have an intuitive sense, by default, of communicating and building relationships.

 

Could you tell everybody how they can reach you?

If you have any interest in talking to us about the coaching program, getting on the phone with Stephanie, and sometimes I jump in and help when she’s overwhelmed, you can go to BlissfulInvestor.com/Zack.

Ladies, take advantage of that. There are not many times we get an opportunity to have a full conversation with successful people in this industry. Also, I know you have a free gift you want to offer, could you tell us about that?

I wanted to show people what it looked like to implement the process and to also see that it works to give you belief. The reason for this is, in my story, I talked about Stan, how I met him, and how he gave me properties at a massive discount. That gave me all the confidence to keep going even though I had had bad experiences in the past. I remember being up late and I said, “I got to give that gift to others. I need to go a Stan on camera and show the world.”

I came up with a little challenge of trying to make $40,000 in 40 days and I only got $1,000. Not only that, I flew across the country to somewhere I’d never been because I didn’t want to have my connections, my team, because that would be cheating. I flew to Tampa, Florida with $1,000, my smartphone, and a car. I did exactly what I taught my students, but I did it with a camera over my shoulder. I made $93,000 in wholesale fees off of $1,000 investment in those 40 days.

It was an incredible experience. It’s free for you to watch. You guys should watch it. It was horrible to do and create. It’s a ton of work. I didn’t see my family for a full 30 days to do this challenge. That was a huge sacrifice on my part. I’m so glad I did it. If you guys want to catch that, there’s a link that you can go get full free access. It’s BlissfulInvestor.com/40Days. Go catch and watch that. Get some popcorn and have some fun. You can sit in the comfort of your own home and enjoying my pain.

We will be enjoying your pain, but we will be enjoying watching it. Zack, I’m so excited about what we covered. Thanks so much for coming back on the show.

Thank you for having me. Everyone, thank you for reading. Thanks for being with me.

I am going to interview some of those ladies. You need to connect me with them. That would be fun.

I definitely will.

We do have more. Zack has committed something very generous for EXTRA. He’s going to be talking to us about his Driving for Dollars Mastery Actual Strategy. In EXTRA, he’s going to give us the actual steps or specific steps that you can take to drive for dollars and pick up properties at a highly discounted price. It’s going to be incredible. I’m so excited that he’s willing to give that away to us. If you are subscribed to EXTRA, stay tuned, that’s coming next.

If you’re not, this might be the time to do it. This is going to be amazing content. Go to RealEstateInvestingForWomenEXTRA.com. The first seven days are for free. You can check out this episode and many others. Stay subscribed or not, but go to that website and we’ll get you to get access to EXTRA. For those of you that are leaving us, thank you so much for joining Zack and me for this portion of the show. I look forward to seeing you next time. Until then, remember, goals without action are just dreams. Get out there, take action, and create the life your heart deeply desires. I’ll see you soon. Bye.

 

Important Links

 

About Zack Boothe

REW 105 | Driving For DollarsMan, I remember what it was like when I first got started in real estate. I’d wake up every morning full of confidence and courage, ready to attack the day. I had a focused plan and I knew exactly how to find smoking hot real estate deals, and quickly turn those deals for huge profits.

Quite the opposite. In fact my reality was fear, doubt, overwhelm, and frustration. I worked my butt off but I was drowning in bad advice from gurus, and strategies that either didn’t work or just weren’t congruent with who I am.

Five years later and I’ve done over 300 real estate deals and have generated millions. Over the years I’ve made a lot of mistakes and have learned a lot of lessons (sometimes the hard way), and I’ve built a dream real estate business…and I’d love to show you how you can too.

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To listen to the EXTRA portion of this show go to RealEstateInvestingForWomenExtra.com

To see this program in video:

Search on Roku for Real Estate Investing 4 Women or go to this link: https://blissfulinvestor.com/biroku

On YouTube go to Real Estate Investing for Women

 

Why You Should Flip The Switch From Real Estate Agent To Investor With Lorraine Beato – Real Estate Women

REW 59 | Agent To Investor

 

In Atlanta 2020, the average real estate investor made almost three times as much money as a real estate agent did. In this episode, you’ll learn the benefits of switching from real estate agent to investor. Moneeka Sawyer’s guest is Lorraine Beato, a real estate specialist at eXp Realty. Lorraine shares with Moneeka how she was surprised to hear her friend, a real estate agent, lament about how she has no retirement plans. Are you a real estate agent who chases solely after commissions without a Plan B for the future? Then this episode is for you. Join in the conversation and flip that switch!

Watch the episode here:

Listen to the podcast here:

Why You Should Flip The Switch From Real Estate Agent To Investor With Lorraine Beato – Real Estate Women

Real Estate Investing For Women

I am excited to welcome to the show Lorraine Beato. Thinking outside the box and getting a transaction to the closing table is her specialty. With over 25 years in the industry, starting with Merrill Lynch and mortgage-backed securities, trading all the way to investing both nationwide and internationally, she knows how to navigate the complex and intricate waters of real estate. In an ever-changing industry, you need to have someone on your side who understands all the facets. If you’re a real estate professional and haven’t started thinking about retirement or want to learn how to invest in the things that you sell every single day, check out Lorraine’s book Flip The Switch: from Real Estate Agent to Real Estate Investor.

Real estate agents need to be investing in the product they sell every day. Click To Tweet

She has been featured in some interesting places. Her renovation in Europe was featured in the January 2018 Think Realty Magazine International Renovation Rockstar. She had listings featured on HGTV’s House Hunters. She’s a Think Realty Single Family Investors of the Year nominee in 2018. The 2019 September issue of Think Realty Renovation Rockstar also featured her. She was featured in 2020 in Yahoo Finance. That’s an awful lot of lovely credentials. I’m glad this finally worked out. Lorraine and I met through Women’s Real Estate Network with Deborah Razo. Deborah has been on the show before talking about networking. She’s a complete powerhouse. It looks like Lorraine was one of the very first WREN leaders on the East Coast, Georgia. Is that true?

I opened the first chapter on the East Coast in September of 2019.

Welcome to the show, and thank you so much. Next time you talk to Deborah, please tell her I say hello. I love your specialty, your niche. I’m going to let you take it away, and then I will interject why I love this so much. Tell us a little bit about what you do and why you picked this particular niche.

REW 59 | Agent To Investor

Flip the switch: from Real Estate Agent to Real Estate Investor

I have been a licensed agent since 1988. I was working for Merrill Lynch. When I graduated college, my best friend said, “Let’s go get our real estate license.” I said, “Sure, why not.” I’m always adding to the tool belt. I did that. I didn’t sell in New York, but I love real estate. I became an appraiser. I worked full-time for Merrill Lynch during the week, and I did appraisals on the weekends. I’ve always had a love for real estate, especially architecture. Going to Portugal every summer as a child, I was always fascinated by everything out there. When we got transferred to Atlanta many years ago, I thought I wanted to be a stay-at-home mom. That lasted for 60 days. I was going stir crazy because I worked a full week on Wall Street on the trading floor. I got home. I did appraisals on the weekends. I said, “This is nuts.”

We didn’t know anybody in Atlanta when we moved. I called up the lady that sold us our house. I saw that there was reciprocity. I had my license transferred. I did real estate very part-time. I took some time off because when we moved, my daughter was twenty months old. A year and a half later, I had my other daughter, and I said, “I’m going to do something part-time.” I started selling part-time then I took a break. When I took the break, we bought investment properties. I jumped back in 2003 once my girls were back in school. I was able to work around their schedules.

Fast forward to 2019. I had an interesting conversation with a friend of mine, multiple of these conversations. There was one in particular. I was talking to one of my good friends. We used to work in the same office, and she said, “I’m tired. My back hurts. I’ve been driving these buyers around for five weeks. I have to sell houses until I’m 70. I’m turning 60 soon.” I said, “Why do you have to sell houses until you’re 70?” She said, “I have no retirement.” I was floored because this is someone who has a corporate background.

She’s a northerner in the south, a highly intelligent woman, a businesswoman, did a good couple of million dollars in volume as a solo agent well into the six figures, and she has no retirement. That conversation in particular, I think because we’re close friends, hit me. As time went by, I spoke at some fix and flip boot camps for some of the local REIAs and local gurus, as I called them. I started having agents reach out to me on Instagram, direct messaging me saying, “Lorraine, I didn’t know you taught real estate agents how to fix and flip.” I stopped, and I was like, “I don’t, but I can.”

Culminate everything together. That’s when I said, “Okay.” There are a lot of people, at least in my market, that are out there telling real estate agents to come and learn how to work with investors so that you can add to your business, but there’s nobody telling the real estate agent that they need to be the ones investing. They need to invest in the product that they sell every day because, at the end of the day, I’m sure you would agree real estate is still one of the largest wealth-building opportunities out there. You can fix and flip. You can have cash flow properties. There are so many ways. There’s so much land, and people need a place to live. I was on a women’s summit. The average real estate agent in 2020, ballpark made about $47,000. The average real estate investor in 2020 in Atlanta averaged $111,000. That’s almost three times as much.

If you're new, find someone who can mentor you through your first project. Click To Tweet

I started doing some of these numbers, and as I said, I’ve had agents reach out to me and said, “It’s time I put this down, and I put it in writing.” That’s my mantra. That’s my platform. I want to get out there and get real estate agents to learn that you don’t need a lot of money. They already have most of the tools that they need or a good portion of them. To become real estate investors, they just have to think outside of the box and get out of that mindset. Most real estate agents are like, “Here comes an investor offer. They’re lowballing us.” They don’t know why. They don’t understand the numbers. I think that was important to do.

I’d say my business is probably 50-50, 50% regular retail buyers and sellers, and then my other half is investors. I came from a closing, as I mentioned, to an investor that found me online. We built a relationship. When the project’s done, we’re going to have a $1.3 million project, and he closed. I will also be helping him with the renovation. I think it’s important. Real estate agents need to get out there. There are so many changes in the industry. When the pandemic hit, we all shifted to doing everything virtually. I think it’s time they learn.

Here’s one of the things that I say on my show frequently. When you’re looking for an agent, look for a real estate investor, friendly agent. Preferably, an agent who is investing themselves because there’s no way to know what an investor goes through unless you’ve been there. You have to have been through the process, fell to the stress, deal with the challenges before you understand what’s happening. Investors deal with a completely different set of opportunities as well as challenges than a regular homebuyer would deal with. Most real estate agents are just taught to sell a house they haven’t been trained in or have it exercise the muscle of thinking outside of the box. They don’t understand.

I’ve got investor-friendly agents. They can’t bring me the project that might make my heart sing. They’ll send me the MLS listings. They’ll send me some ideas, but in the end, I’m the one that has to be the machine that figures it all out. My agents know what I’m going to ask. They know that I’m probably going to rent something out. When they show me a condo, they know that they have to look at the CC&Rs to see if I can rent it out. They know the basics. They know my neighborhoods. They know what I’m looking for. It has to have a particular zoning. That’s all stuff that I’ve shared with them. They don’t come to me and say, “Moneeka, this just became a pocket listing. I think it would be amazing for your strategy or if you would consider altering your strategy a little bit, this is what we could do with it.”

REW 59 | Agent To Investor

Agent To Investor: As a real estate agent, don’t just tell clients what they want to hear. Tell them why you think the project won’t work. They’ll realize you’re not about the commission and follow you anywhere you go.

 

I engaged another realtor who does more of that. She herself only has one rental property. At least she’s got one. That’s better than the last person. She’s not fully engaged yet in that whole process. She wants to be, so she’s also learning a lot from me. That’s a more interesting relationship to me, too, because the conversations can be different. I don’t get a lot of noes. I get a lot of, “Let’s find out about that.” That’s at least better. From my perspective, if an agent is investing, they’re going to be the best partner for an investor. Here’s the truth. Being an agent is a job. As long as you sell houses, you make money. If you can manage to sell houses and still save, you’re doing great, but the best savings plan is a house. In the end, you don’t have to have a certain number of dollars saved away. You just have to have cash flow. You can do it one way or the other. We can’t do that in other industries. This whole thing about, “I don’t have a retirement,” that is so familiar, sad, not necessary in this industry.

The gentleman that I closed earlier found me online on a listing that he thought would be a good fix and flip because there was an investor that had it. I told him, “This is not a good fix and flip. The numbers don’t work. That’s the other thing. This is what needs in rehab. This is what needs for this. These are the finishes that it needs for this neighborhood.” We built that relationship. He would periodically bring me deals. He’s like, “What do you think of this one?” I’m like, “There’s not enough margin.” I understand what the margin is. He’s like, “What about this one?” I was so blessed because he told the hard money lender. He said, “I’ve worked with a lot of real estate agents. Most of them tell me what I want to hear. I’ve run 4 or 5 deals by Lorraine, and she’s told me why she thought they didn’t work. She wasn’t about the commission.” As we’re sitting there at the closing table, I told him, “I may be in a transition period from brokerages.” He said, “I don’t care where you go, I’m following you.” I set him up with the builder, architect, hard money lender. He’s like, “You’re like the one stop shop.” I think that’s the difference. I think that’s what separates us a bit.

A lot of agents will tell you what you want to hear because they want to make the commission, but there’s also the other side where the agents will be like, “That’s too scary. That’s got a foundational problem. That’s got that problem. This is going to be too expensive or too hard.” This is not a criticism. It’s just training. They’re not trained to think of all the opportunities that each of these challenges can present. I have a business partner. He’s been in real estate for about as long as me but in a very different world. He grew up in the country. I grew up in the city. He and his dad loved to get in there and pick up the swing and hammer and put in the appliances, and do all this stuff. They built their own house too. He gets his hands on the mud type of guy. I’m totally hands-off. I’m like, “I’m going to go on vacation to Europe. Can you fix this house for me?” We totally complement each other beautifully because we both come from this different angle.

What’s so funny is we started shopping for properties together. We’re doing some construction stuff together. I would go in, and I would be like, “This is like sloping. They say there’s a foundation problem.” He’s like, “This is amazing.” They’re like, “What are you talking about?” He’s like, “We’re going to buy it, and we’re going to rent it for two years. We’re going to get permits during those two years. We’re going to get the architect and engineer. We’re getting it all done, and then we’re tearing the thing down.” We want something that nobody else wants because we know what to do with it. It’s like a foundation problem. You’re going to get it at a big discount for liability reasons. I’m not saying that I have any kinds of homes that are not really safe to live in.

A foundation problem is not usually a problem for 10 to 15 years. If I’m holding it for only two, I plan to tear the whole thing down and rebuild. It’s a different conversation. Of course, it has to be safe, but it doesn’t need to be perfect. It doesn’t need to be gorgeous. It needs to be safe, happy, and livable. We’ll make someone very happy for a little while. I had to have that conversation with my business partner, and no real estate agent wanted to sign the contract on this. People didn’t even want the liability of signing the contract. This is California. Things are done a little differently here. I get that. The point that I’m simply trying to make is an agent that understands investing is a huge asset.

I just love what you’re talking about, Lorraine. This show is mostly for investors. Investor ladies, you are going to learn a lot from Lorraine. She’s already given us some amazing nuggets like the numbers have to work. Say no as often as you need to find the right kind of project that should be a yes. Make sure your margins are good. Any project that you take is going to take more money and more time than you ever anticipated. You need to know that you got some good margins. If you’re going to do flipping, you have to be on point because if anything goes wrong, it takes away those margins. If you’re not on point, if you don’t know what you’re doing, you can have some challenging times.

That’s why I don’t recommend flipping for beginners, although I know a lot of beginners have done really well. I generally don’t recommend it because when you have that expertise of walking into enough houses and evaluating enough projects, that’s when you start to be able to be better at evaluating what those margins are really going to be. Having the confidence to know that even if that margin shrinks, you’re going to make money. Would you agree with me on that, Lorraine?

God gave us two ears and one mouth. If you just shut up and let people talk, they will pour their guts out to you. Click To Tweet

Yes. If you are going to do your first project, be smart about it. I had a gentleman who reached out to me a couple of years ago. I was on a panel for Think Realty. I’ve got a close relationship with him. He was in the audience. He stood up and said, “How can I be an intern?” It took a couple of years. We went back and forth. He would ping me here and there. A few summers ago, he reached out, and someone wanted him to invest his money with them. I said to him, “You’re not going to get in and out of new construction in six months, especially in Atlanta. Your permits are going to take too long. I don’t agree with the ARV.” He came back, and he has a lot of buts because he was new, young and green.

I said, “At the end of the day, it’s your money. I can’t tell you what to do with your money. You have paid me for my professional opinion. If you’re going to move forward, I want you to go ask this investor these questions.” He came back to me the next day with no questions answered. I was like, “How’s your money secured? Who’s holding it? What percentage of the LLC do you have?” He proceeded to send me a screenshot of his bank account.

When I saw how much he had in there, I said, “Why don’t you do your own fix and flip? Let’s find you the right project. I will mentor you through it. We’ll joint venture.” It took us about six months because I was not going to put a new investor into a gut job. That’s a lot of what’s in Atlanta. I wanted something that was simpler. That’s what we did. If you are new, find someone who can mentor you through your first project. We joint ventured. I held his hand. I managed most of the projects. We did a profit split at the end. I listed the property being an agent. His first flip was very successful. After our split, he got a 50% return on his money. That was after our split. If you’re going to do that, find someone you trust and go about it that way is what I would recommend.

Talk to us about what your specialty, teaching realtors. The adventures. I want to let the ladies know preemptively. You’ve gotten some good stuff, and you’ll continue to get good stuff. This is for the readers that are realtors that are thinking about this whole investing thing. Either they’re growing their business with investors or growing their own business for retirement or for themselves. Here’s another thing that’s really interesting. Many of the ladies that have contacted me have said, “I want to be an investor, so I’m going to go get my license.”

I want to say that you do not need to have a license to be an investor. As a matter of fact, there are states, for instance, in California, where that is a hindrance. There’s a reason I don’t have a license. I wanted to build a multimillion-dollar business without the hindrance of California poking their nose into it or the real estate board. I don’t have a license. You do not need to have a license to be an investor. However, if you do have a license and you want to be an investor, you want to specialize and invest in clients. That’s what Lorraine talks about. Let’s move into that conversation.

You don’t need a license. I started as a realtor before I got into investing. I created a niche. We did a guru program. I became the point person in Atlanta. I started telling people in this group, “Your numbers don’t make that sense. This doesn’t make sense. If you’re going to get funds, make sure your positions are secured,” and all of these other things. When I saw the money I was making for my clients, that’s when I jumped into real estate and became an investor. I do both and I love it. You need to understand that if you’re going to be a realtor, a real estate agent, and you’re going to invest if you’re going to get into the wholesaling side, that’s not something that I do. The question comes up a lot.

You have to see the requirements for your state because they vary. I don’t wholesale because in the state of Georgia if I were going to do any marketing or do any mailers on the wholesaling side, I would have to list that I am a licensed agent, the brokerage firm, broker’s phone number, my phone number. It’s not to say that it wouldn’t work, but it’s like muddies in waters. I don’t like to do that, so I don’t. Do you want me to go into the piece about my lake house?

We’re going to talk about the lake house in Extra. She’s got a case study that she wants to share with you, and we’re going to talk about it. We’re also going to talk about a cash flow property. For now, I wanted the ladies to have an idea of what you’re talking about.

I think being a real estate agent that’s also being an investor, most real estate agents are after the commission. If a seller calls them, it’s all about, “I need to get the sign in the yard. I need to get the listing agreement.” You need to understand that, in my opinion, for us as real estate agents, it is our responsibility to help people in the best way that we can. For a seller, that may not always be putting a sign in their yard. That might not be the best solution for them for various reasons. It’s understanding how we solve their problem.

I’ll give another example. I had an agent in my office who threw up a post and said, “I need help with a short sale.” I’m not a short sale agent. I don’t know what to do with it. Now I am a certified REO and short sales specialist. I said, “I can help you. I’ll take the referral.” What you want is a referral fee. As I got down to it, I call the client and had a conversation with them. I realized this wasn’t a short sale at all. It was a pre-foreclosure. In this particular instance, the client would have never been able to do a short sale because there was equity in the property, even in the condition that the property was in. For them, sticking a sign in the yard was not the best solution. We also had six weeks to get the property sold. What I did instead, because I work with investors, and she was ready to walk away, the property she had inherited would have gone through probate. Family members move in didn’t pay the mortgage. They weren’t pre-foreclosure. They couldn’t catch up because it was something to the tune of $28,000.

REW 59 | Agent To Investor

Agent To Investor: Keep reading. Learn about what’s going on in the market. Be aware of what’s trending both locally and nationally.

 

She said, “I’m ready to walk away.” I said, “Let’s not walk away. Let me put some money in your pocket.” I called one of my investors, and I said, “Here’s a great property that would be a great fix and flip.” I know he’s cash. He buys with smaller margins because he is cash. I got her a cash offer. I got it sold. I made my percentage because he paid me. They didn’t have any capital, but the investor paid me. I put $13,000 in their pocket when they were ready to walk away. Her biggest concern was, “I cannot have a foreclosure in the memory of my mother’s name,” something to that effect because her mom had passed. It bothered her to the core that she would let her mother’s property goes into foreclosure. Even though she was gone, she didn’t want to taint that memory. That’s what was more important. It wasn’t putting a for-sale sign in the front yard with people traipsing in and out of their house.

Those stories happen all the time. As an agent, a lot of times, you don’t get to that story. The client calls and says, “I’ve got this problem.” In the stuff that you’ve been trained in, in this case, you had heard the term short sale but didn’t understand well enough about it to know that this wasn’t that particular instance. Some of the things that we’re trained on as investors is really getting the whole story. It’s not just another number, another house, another sale. As investors, were significantly more involved in the project and in people’s lives. That’s even true if you invest like me.

I do have an agent. I get all of my properties off the MLS. I probably make 30 offers for each one that I buy. The ones that I end up buying are the ones where we wrote a personal letter. I write a personal letter for all of them. We end up having a conversation with the seller about what they need. My agent is not particularly tuned that way. He resists me. I’ll say, “This seems a little odd. Why are they selling it at this price in this particular neighborhood? What’s going on?” “There are a few problems with the house.” “There’s something else going. Can we find out?” He’s like, “That’s intruding.” No, it’s not intruding. I want to know how to best make an offer that’s going to make them happy. You’re welcome to tell them that. He has told me that the best offer that’s going to make them happy is the most expensive one. That’s what they’re going to say.

Consistently, I don’t know why he sells this to me. It’s been going on for twenty years. If I say, “Could you ask what’s going on?” After we go through our back and forth, he’s like, “The dog just died. The smell is making them crazy. They just remember this dog, and they want to move out.” Not that the house is smelly, but the way that it is, whatever. They’ve had this heartbreak. That’s weird to me, an interesting reason to want to move. It’s happened, but they wanted someone to love the house still because they still love the house. Who would ever talk about their dog died?

God gave us two ears and one mouth. If you just shut up and let people talk, they will pour their guts out to you.

A lot of times, they’ll say, “There’s an open house.” I’ll say, “Is the owner going to be there?” My agent was like, “You don’t want the owner there.” I was like, “Yes, I do.”

Going back to that list, just to tell you something interesting. She hadn’t had a bunch of wholesalers sending her letters. She had talked to a bunch of people. It was so funny. This is what people think about. I walked in the door, and her grandson, who was eighteen months old, comes up to me and grabs me by the leg. He’s mesmerized. I’m talking to him, “How are you doing?” I left after I spent about an hour with him. I called her back. “Here’s what I think we could do.” She’s like, “I trust you. My grandson doesn’t like anybody. The mere fact that he immediately took to you, I knew you were the right person.” She’s like, “Children and dogs. They know who the good people are.”

Isn’t that the truth? I’ve had that also happen where I walked into a house, and the dog did not go crazy barking. Instead, it came over so I can scratch him behind the ears. That got me a sale too. It bought me a purchase also. You don’t know where it’s going to come from. The whole point is that there’s a definite different mindset of an investor than with most agents. If you’re able to be an agent that is also investing, you’re going to be a better representative for your own clients. As importantly, you’re going to set yourself up for success in the future and build that retirement program that you’re building for your clients. Tell me what the path is possibly for an agent to start making that mindset switch and taking those first pieces of action.

A lot of things have moved online because things are virtual. I am a big networker. I do it virtually now. I’m in a bunch of Facebook groups. I would say start by joining a group like WREN, the Women’s Real Estate Network, or joining a local REIA. Start to understand. Start talking to people and have conversations. Even in some of these Facebook groups, go in and take time. For example, someone posted this property, and the numbers were wrong. We were all calling this guy out, telling him why his numbers were wrong. You can learn a lot by spending some time going in and reading some of the conversations in these forums, joining a REIA, and finding your local investors. Is anybody willing to work with you? Can you shadow them? How can you help them? Go, run free comps for them if they need it. How can you bring value to them so that you can also learn from them? You’ve got a relationship. It’s giving on both ends. It’s not just one-sided. I think that’s your best way to start. That’s what I tell people to do.

You also mentioned that you’ve already got the tools that you can use to start that investment journey. Could you talk a little bit more about those tools and how to use them differently?

As real estate agents, we have access to the MLS. If you’re a good agent, you know how to pull and run comps. You should be able to see areas that are starting to trend. We’ve had a lot of areas here in Metro Atlanta that have gentrified. You can see where the values are starting to go up. You can identify neighborhoods that are up and coming. You’re working with clients, with buyers. You know what your buyers like. If you’re going to fix and flip, you know what they’re looking for. From their feedback, when you go through houses, you granted to their like. What are the paint colors that are in? If you’re going to either fix and flip or do cash flow properties, the property needs some work. You should have a handyman, an electrician, a landscaper. We already have so many of the tools as resources that we provide to our clients that are ready to go and can help us make that transition easier because we already have that foundation.

You also have the conversations in the office that the rest of us don’t get to have like the REIA client. I’ve got this listing that’s interesting. I don’t know what to do with it. I don’t know if you do pocket listings there. You get first access. They are allowed in some places. They’re not allowed to others. It is interesting. You have resources when you’re an agent that the rest of us investors don’t have. You have to figure out how to utilize them for yourself with an investor slant.

In my office, when people have scenarios with properties, I had another one that I could get into. When you have agents that don’t know how to think outside the box, that’s a potential for you to also get more referrals. I had another one that we should be closing with an agent from my office’s opinion on Facebook. He’s like, “I’ve got a referral for you.” I messaged him back, and I said, “Did you stop selling real estate?” He said, “No. I just don’t know what to do with it. It’s more an investor-type deal.” He goes, “The guy works with my wife.” I said, “No problem.”

I went and looked at it. I told him, “I can put it on the market. I can probably get you $20,000 more.” My wholesale partner talked to him. We were able to meet his number. He’s like, “If you can get me this, I’ll sign the paperwork, and I’ll walk away.” We’re selling it to a hedge fund that’s going to have it as a rental. We’ll split the wholesale fee. I’m still in a way getting my commission. You then become a go-to person for those agents that don’t know what to do with these properties where you can find potential opportunities for yourself or your investor clients.

If you have an investor that you can shadow, that’s one way to learn some stuff. Are there any other ways that you would recommend for an agent to learn about a lot of these resources that you talk about and how to become an investor themselves?

Don't get into analysis paralysis. Just do it. Click To Tweet

I could probably go on for hours. Pick up my book. I go through a lot of this in my book. There are so many different things depending on what asset class you want to go into. I will tell you I am not a systems girl. Don’t ask me for systems because I’m still very much a pen, paper, and Excel spreadsheet type of person. That’s how I’m wired. I still think that’s the best one. Join the REIAs and shadow another investor. Read as much as you possibly can. Get into some of these Facebook groups.

Thank you so much. That’s awesome. Tell everybody how they can reach you, Lorraine.

I am Lorraine Beato across all platforms like LinkedIn, Instagram, Facebook. My phone’s getting bombarded, but if you’d like to email me and reach out, if I can help, I’d be happy to. It’s [email protected]. I have my website. That’s LorraineBeato.com as well. I was in there, and something happened because it doesn’t look right. We’ll put that one on the back burner. That’s the easiest way to find me. You can reach out to me on any of the forms of social media.

Lorraine, I did not tell you this preemptively. I hope you’re not going to kill me. I got some rapid-fire questions for you. Are you ready to go? Lorraine, here are the three rapid-fire questions. The first one is, what is a super tip on getting started investing in real estate? You can give this from the agent’s perspective.

Do it. Don’t get into analysis paralysis. Just do it. Of course, be cautious. Do your due diligence. Take that first step. Whatever that first small step may be, even if it’s a phone call. A lot of real estate agents don’t know what hard money is. Google hard money and make some phone calls to the hard money folks in your area and start that conversation. That’s how I started learning about hard money.

What is one strategy on being successful in real estate investing? This is more for people that have already been investing.

I’m very anal about my numbers and the after repair value. I think you always need to run things conservatively. Have a contingency fund. Always plan to add to your budget. As you said earlier, there will always be something that comes up. It will always take longer than you expected. For example, if I have a fix and flip, the contractor is telling me we’ll be in and out in eight weeks, I run all my numbers on six months holding costs, no matter what. Pad your budget and timeline.

What is one daily practice that you do, Lorraine, that contributes to your personal success?

I read a lot. I am always learning about what is going on in the market, what’s trending, both locally and nationally. I keep up with all the CARES Act stuff because of COVID, the moratoriums, and what’s happening. I read a lot. I like to stay informed on what is happening in the real estate industry across the board, not just as a real estate agent but as a real estate investor. It’s important because then you become a resource for people that maybe aren’t going to buy or sell right now. I had regular clients reach out to me. They’re like, “Should we go into forbearance or not?” I had that conversation. “Why do you want to go into forbearance? These are the ramifications.” It’s having that knowledge and really being in tune with what’s happening across the board.

I read a lot too. It expands your mind too. Lorraine, this has been awesome. Thank you for everything you’ve shared. We are going to go into Extra. We’re going to talk about how she acquired her lake house. We’re going to have a case study. If we’ve got the time, we’ll do another couple of properties also. I’m really excited for Extra. If you’re not subscribed, you can go to RealEstateInvestingForWomenExtra.com. You get seven days for free, so you can check it out. If you love it, you stay. If you don’t love it, you can, of course, not stay. Try it out. For those of you that are leaving us now, thank you so much for joining us for this portion of the show. I look forward to seeing you next time. Until then, remember, goals without action are dreams. Get out there. Take action. Create the life your heart deeply desires. I’ll see you soon.

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About Lorraine Beato

REW 59 | Agent To Investor

Graduating in 1988 from Manhattan College with a BA in Economics and International Relations and working full time for Merrill Lynch, her best friend asked her to join her in a real estate licensing class.  So about 3 weeks after graduating from college, off they went, took the class and became licensed REALTOR®s in May 1988.

After working for Merrill Lynch she spent some time working for a small Brazilian Bank on the investment banking side and foreign exchange trading. She was bored at the Brazilian bank, quit and as a referral started working for an internationally well-known businessman, Adnan Khashoggi who in the mid-1980s was dubbed “The Richest Man in the World” Lorraine became exposed to international business and real estate deals and was enthralled with all the residences which Mr. Khashoggi owned.

As AK’s personal executive assistant, she was heavily involved in his dealings including the sale of AK’s mega-yacht The Nabila to Donald Trump in 1989. Real estate has always been a constant thread in Lorraine’s life albeit in different ways.

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