Real Estate Rookie

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Latest Episodes:

80: Rookie Reply: How Does Property Management Handle Maintenance? May 22, 2021

Show notes

This week’s question comes from Bryan on the Real Estate Rookie Facebook Group. Bryan is asking: How do PM (property management) companies handle maintenance? Do they fix the issue and submit invoices to the owner or withhold the amount from monthly payments to the owner?

This is a great question for those who want to transition from self-management to hiring property managers. Both Ashley and Tony have the same type of payment setup with their property managers, but it can vary company to company.

Here are some answers/suggestions:

Both Ashley and Tony have a maintenance threshold for small repairs
Anything over the threshold needs to be approved
One the job is done, the cost is deducted from the rent
You can always go with a PM’s repair/remodel bid, but it may save you money to hire an outside contractor you know and trust
Try and get PM companies with software, so you can see the exact invoice online
And more in the episode…

If you want Ashley and Tony to answer a real estate question, you can post in the Real Estate Rookie Facebook Group! Or, call us at the Rookie Request Line (1-888-5-ROOKIE).

Check the full show notes here: https://www.biggerpockets.com/rookie80

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79: 19 Year Old College Student Making $18,000 Per Deal May 19, 2021

Show notes

Wholesaling is a tough game. Most investors who try their hand at wholesaling quit after only a few months, while those who have the grit to stick it out can end up making a much-deserved profit. Even real estate veterans have a hard time getting into wholesaling, but what about a 19-year old college student without experience in real estate?

Isabelle Zukowski just happens to be that 19-year old college student wholesaler. Isabelle had been working at a local restaurant when the COVID shutdowns started, she was released from her job and had to go on unemployment. While she was getting her unemployment money, she started listening to stock market, real estate, and business podcasts. She was interested in real estate, and when her friend told her about real estate wholesaling, she decided to try it out.

Isabelle joined a bunch of Facebook groups, contacted well-known agents and wholesalers in her area, and started building out her network. After 3 months of hard work, calling 300+ people a day, she landed her first deal. The wholesale fee? $18,000!

In This Episode We Cover

Real estate wholesaling with no experience or money
3 tips for getting your first wholesale deal
Skiptracing and the best lists to pull for cold calling
Building relationships with everyone in your specific niche/space
The best way to estimate rehab costs and ARV
And So Much More!

Links from the Show

Check the full show notes here: http://biggerpockets.com/rookie79

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78: Rookie Reply: How Do I Estimate Property Taxes? May 15, 2021

Show notes

This week’s question comes from Gre on the Real Estate Rookie Facebook Group. Gre is asking: How do you find accurate property tax info, including school taxes, when running numbers on a potential investment property?

Great question Gre! Running your numbers accurately is super important when making sure a deal will be profitable, thankfully, there are many online (and in person) resources where you can find accurate property taxes within minutes.

Here are some suggestions:

Find the county assessor’s online website and look up the property address/parcel number
Use third-party tools like Propstream to find property taxes
Ask other investors in your area what they are paying in property taxes
Call the county office and ask what they think property taxes will be when re-assessed
Make sure you’re including school, village, and county taxes (when they apply)
And More!

If you want Ashley and Tony to answer a real estate question, you can post in the Real Estate Rookie Facebook Group! Or, call us at the Rookie Request Line (1-888-5-ROOKIE).

Check the full show notes here: http://biggerpockets.com/rookie78

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77: CPA Answers Depreciation, House-Hacking, and Rookie Tax Questions May 12, 2021

Show notes

Amanda Han is a familiar face to the BiggerPockets audience. She’s been featured on the BiggerPockets podcasts before and has written multiple books published by BiggerPockets (The Book on Tax Strategies for the Savvy Real Estate Investor & The Book on Advanced Tax Strategies). Amanda has worked with lots of real estate investors and invests in real estate herself, so she’s answering some common questions that rookie investors have about taxes.

We run through a mix of topics such as deductions, depreciations, home-office write-offs, expenses, legal entities, and when you should get a CPA. Amanda also talks about some of the most common deductions that rookie investors miss. She also talks through different software for tracking your business expenses, recording your mileage, and keeping your business finances up to date.

It may seem like a lot of information to keep track of, especially when you’re in the middle of a rehab/flip or even just managing your rental. Amanda stresses how important it is for you not only to find a high quality, real estate friendly CPA, but also that you keep them in the loop. If you’re thinking of buying, selling, or transferring property, it’s incredibly important to keep your CPA notified on all things related to your real estate business. That way, you keep more money in your pocket and are able to grow your portfolio even faster!

In This Episode We Cover

The most common tax mistakes that rookie investors make
The best way to track your expenses (and your different options)
When you should consider, interview, and hire a CPA
The best questions to ask a CPA if you’re interviewing them
Home office deductions, mileage deductions, and more
When the best time to form a legal entity is (if needed)
What to write off when you’re house hacking
And So Much More!

Links from the Show

Real Estate Rookie Facebook Group
BiggerPockets Forums
Ashley's Instagram
Tony's Instagram
Quickbooks
Excel
Appfolio
Buildium
Rookie Podcast 75: From Working on Oil Fields to Passively Investing in Real Estate with Travis Watts
BiggerPockets Pro and Premium Membership
BiggerPockets Pro Perks (Exclusive deals like Amanda's Course)
Jumpstart Your Tax Savings as a Real Estate Investor

Check the full show notes here: http://biggerpockets.com/rookie77

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76: From No Experience to Multi-Million Dollar Business with Ellen Bennett May 08, 2021

Show notes

Before cooking at Michelin star restaurants, Ellen Bennett worked as a lottery announcer, an English tutor, and a “booth babe”. All of these jobs taught her to be comfortable in uncomfortable positions. When her head chef told her that he needed new aprons for all the cooks, Ellen took to the challenge, with no business plan, no connections, and no experience designing aprons. The deadline, uncomfortability, and challenge pushed her to deliver the aprons on time, and start Hedley & Bennett.

Now, Ellen runs this multi-million dollar business that delivers to Michelin star restaurants and at-home cooks alike. Ellen talks about the necessity of committing to something scary, even when you don’t know how to handle it. She used the same approach when buying 3 rental properties nearby her home in Los Angeles, all of which have appreciated dramatically.

The mantra used in creating a successful business, investment, or anything else is Dream First, Details Later, which also happens to be the name of Ellen's new book! An entrepreneur can get bogged down so easily with the details of any venture, so much sometimes that it could push them away from accomplishing something great.

In This Episode We Cover

How Ellen accidentally started an incredibly successful apron business
Using the pandemic to think differently about products and needs
Looking at challenges as a gift and an excuse to grow
How to plan when you know that things won’t go as planned
Setting your employees up for a failure-first mindset (so they succeed!)
And So Much More!

Links from the Show

Check the full show notes here: http://biggerpockets.com/rookie76

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75: From Working on Oil Fields to Passively Investing in Real Estate with Travis Watts May 05, 2021

Show notes

Travis Watts grew up with frugal parents. They taught him about coupons, buying the off-brand products, and basic financial 101, but never taught him about real estate investing. In 2009, as the market was hitting unprecedented lows, he decided to start investing in real estate. He purchased a single family home to start, then started house hacking, moved on to some fix and flips, bought some vacation rentals, and before he knew it, he was a very active real estate investor.

There was one problem though. Travis was working 90+ hour weeks in the oil industry, often working overseas for long periods of time. Travis was trying to run his active investing with his hectic schedule, but often found it hard to put a high level of effort into his rentals when so much of his energy was being exerted from his job. In 2015, Travis made the decision to become a passive investor.

Passive investing isn’t for everyone, especially for those who want to be making the big decisions. Luckily, Travis didn’t mind having general partners make decisions for the syndications he invested in, if anything, he preferred it. Travis walks through what you need to look at before putting money into a syndication, including the general partners, the market, and the deal. He also talks through how to identify whether or not a syndication is being run well, and other passive investing strategies like investing in REITs.

Many real estate investors will find themselves with lots of projects, lots of experience, lots of money, but little to no time. If you feel like this, it may be a good idea to start balancing some of your active investing with more passive cash flow opportunities!

In This Episode We Cover

The benefits of passive and active real estate investing
Syndications and who they’re meant for
506(b) and 506(c) syndications and the differences between the two
How to identify good general partners running syndications
Becoming an accredited investor
REITs (real estate investment trusts) and other passive income strategies
How much money passive investors can make
And So Much More!

Links from the Show

Check the full show notes here: http://biggerpockets.com/rookie75

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74: Rookie Reply: Next Steps After Buying Your First Property May 01, 2021

Show notes

This week’s question comes from Jennsey on the Real Estate Rookie Facebook Group. Jennsey is asking: what’s the next step after your first property, as far as financing and steps to scale to a larger portfolio.

If you’ve gotten your first property, congratulations! Now you have the momentum and experience to go get more! The next steps that are most important are finding the money for your next deal, getting your systems and processes in place, and letting others know you’re a real estate investor looking for deals.

Here are some suggestions:

Save up for a conventional mortgage, link up with a partner, find a hard money lender, or find a private money lender
Understand the fees and structures in each of these types of financing
Put together a binder showing your past deal, your experience, and your goals
Know how many doors you want to acquire and lay the foundation for that goal
Every time you do something with financing, tenant management, or underwriting, make sure you document how you’re doing it
And More!

If you want Ashley and Tony to answer a real estate question, you can post in the Real Estate Rookie Facebook Group! Or, call us at the Rookie Request Line (1-888-5-ROOKIE).

Check the full show notes here: https://www.biggerpockets.com/rookie74

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73: Partnerships: What to Do Before You Jump in With Another Investor Apr 28, 2021

Show notes

Believe it or not, Tony and Ashley haven’t met each other in real life...until now! They’re recording from the BiggerPockets headquarters in Denver, and they brought their partners! Tony’s wife Sarah and Ashley’s business partner Joe are here to answer the most common questions about partnerships and investing with someone else.

What makes a great partner? Tony, Sarah, Ashley, and Joe all agree that a good partner has to have complementary strengths to you. Do you know how to do financing but are terrible at design? You should find a partner who loves design but doesn’t want to touch financing. Although it may not be the easiest task, one of the best ways to find a partner is to look at your weaknesses, your strengths, and look within your circle to find someone who could be the yin to your yang.

Ashley also talks about the “partner presentation”. You may have heard this term before on the show. A partner presentation is essentially a binder including a bank statement, credit report, personal finance statement, and past deal history. This helps you show a potential partner that you’re coming from a position of strength and that you possess the competence to tag team a deal.

Ashley, Tony and their partners also go over things like goal setting, partnership structures, LLCs, life insurance policies, and more. While many rookies feel they don’t have the experience to bring to a partnership, it’s important to know that you running the numbers, listening to the podcast, and having interest in real estate already puts your skillset above many others!

In This Episode We Cover

What Ashley and Tony look for in their partners
What a good partner looks like and what you should avoid when partnering up
Preparing your “partner presentation” for a prospective partner
Setting goals and staying on the same page as a partner
How to structure your partnerships so everyone is on the same page
Umbrella policies, life insurance policies, and other partner protections
And So Much More!

Links from the Show

Check the full show notes here: https://www.biggerpockets.com/rookie73

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72: Rookie Reply: Cash Out Refinances vs HELOCs | Which Should You Use? Apr 24, 2021

Show notes

This week’s question comes from Ricky on the Real Estate Rookie Facebook Group. Ricky is asking about the pros and cons of using a cash out refinance vs. using a HELOC (home equity line of credit), especially since you can pay down a HELOC and use it over and over again.

Many real estate investors take advantage of HELOCs since you can get them for your primary residence or a rental property. That being said, HELOCs can come with variable interest rates and can be closed once up for renewal.

Here are some points to consider:

First see if your primary home qualifies for a HELOC, if not, go the commercial route
Primary residences will get better interest rates compared to commercial HELOCs
Cash-out refinances are a great way to get equity that's been built over time with a low interest, long-term loan
HELOCs may require you to take out from them every year, or be penalized
You may be able to get HELOC closing costs waived, unlike on a refinance
And More!

If you want Ashley and Tony to answer a real estate question, you can post in the Real Estate Rookie Facebook Group! Or, call us at the Rookie Request Line (1-888-5-ROOKIE).

Check the full show notes here: http://biggerpockets.com/rookie72

Learn more about your ad choices. Visit megaphone.fm/adchoices

71: Auctions, Section 8 Tenants, and 16 Doors in South Chicago with Martin Neal Apr 21, 2021

Show notes

Martin Neal started his career as a police officer during the great recession. His family convinced him to buy a condo since prices were near rock bottom, this is when Martin was bit by the real estate bug. When he was transferred to another police station, thus doubling his salary, he knew it was time to do something with the condo. He paid off the loan and set up a HELOC (home equity line of credit) so he could purchase cash flowing rentals!

Now Martin uses the BRRRR strategy to buy homes that need rehabbing, rehab them, rent them out, and get them into conventional loans. As of now he has 11 properties with 16 doors, most of which was picked up just in the last 3 years.

Martin has done what many investors advise against, worked with his family. He has his dad running management on some of his properties and helps when rehabbing them as well. How did Martin work with his dad without jeopardizing their relationship? He sat down with his father, laid out the roles and responsibilities of the project, and paid him for his time. It’s tough finding trustworthy workers and partners in real estate, so don’t disregard family just because they’re family!

Martin also gives some great advice on finding high-quality section 8 tenants, many of which helped his real estate portfolio through the COVID-19 shutdowns due to their government subsidized rent. He also talks about buying homes off of auction sites, but making sure you’re able to do your due diligence before putting in an offer.

In This Episode We Cover

Using HELOCs to fund your future BRRRRs
Having a defined plan so you can scale faster and with less headache
Having the bravery to buy more units, even when it pushes you into new territory
Why townhouses may be an attractive asset in specific parts of town
Working with family (without destroying your relationships)
Buying homes at auctions
And So Much More!

Links from the Show

Check the full show notes here: http://biggerpockets.com/rookie71

Learn more about your ad choices. Visit megaphone.fm/adchoices

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