저자: DavidGreene · 외국인
요약 보기
부동산 시장 폭락 가능성에 대해 근거 없는 폭락론을 경계하며, 금리 인상 시에도 집값은 쉽게 내리지 않고 매도자가 버티다 조정된다고 설명. 현금흐름 중심 투자보다 자산 가치·세제 혜택·본업 소득 강화를 강조하며, 인플레이션을 에스컬레이터 하락에 비유해 자산 형성 노력을 촉구. 대상 자산에 대한 명시적 1~3개월 방향 예측은 없음.
다듬은 글
Inflation is creating a situation where you're actually on an escalator and you are going down. But I have this belief that when you buy your dream home and you retire, you die. They watch me get promoted over all of them and there was some animosity there. What about guns? More guns or less guns? Like these are disasters.
You don't want to end up in these kind of partnerships with real estate. All of a sudden, you would absolutely, almost without a doubt, see a softening of real estate prices in those cities. Market doesn't care that you waited four more years to buy a real estate. I would not be surprised if he just charmed the whole country and stepped in and became the next president.
All I was doing all day long was playing World of Warcraft. I was not a very personable guy. I was a cop. I have extreme amount of regulation around me. At any point, FINRA or the SEC could just walk in my office. That's my whole point of this three pillars approach to wealth building is it doesn't pigeonhole you into only one way to do it.
. Today, we have David Green here. You are authors of the book Buy, Rehab, Rent, Refinance, Repeat, the BRRRR book, the Long-Distance Real Estate Investing, How to Buy, Rehab, and Manage Out-of-State Rental Property, and Sold, Every Real Estate Agent's Guide to Building a Profitable Business. And now you have a new book coming out.
Tell me about it and then we got to talk about what is happening in this market. Are we going to have another 2008? Right on, man. So, this book is written as the antidote to the get-rich-quick culture that has made its way into real estate investing. I finally had it up to here with people coming to me and saying, "Hey David, I have no money, no job, no skills, no credit, nothing to offer, and my life is terrible.
How do I invest in real estate so I can fix the whole thing?" And I just I wanted to help people and I knew that giving you information about how to invest in real estate is the equivalent of giving a three-year-old a license to drive a car. It's You need some skills before we get to that point. So, I wrote this book Pillars of Wealth, How to Make, Save, and Invest Your Money to Achieve Financial Freedom.
And the idea is the blueprint that I use in my own life to become a multi-millionaire. So, I focused on saving money. I was very, very detailed about where every dollar was going and tracking that. And then I learned how to make more money and I did that through working in restaurants and then working in law enforcement and becoming real estate.
There's actually a skill to making money that anybody can learn. And then once you have some money, now you can go invest it safely. It's just a different way to look at the world of real estate investing as opposed to what everybody hears is get rich quick, take my program, buy my course, and I will teach you how to turn a dollar into 15 cents or whatever the case may be.
Yeah, I mean, you're so right. It's It's this get rich quick idea is is so sensational. It goes viral. It's so exciting. But then unfortunately, I wonder if it's almost like we were talking about earlier when we came in. It's like there's so much like there's so many dating apps and it's so easy to date.
Everything seems so desirable. So, then you just pick off what seems most desirable, but nothing actually ends up working out. And it's very much in real estate where if we're left with oh, the only way to make money is get a 10% cash on cash return, you just never end up investing. And you never actually build out as you say, the pillars of creating a strong foundation.
So, how should people in today's environment with let's maybe start with the market and then kind of work from there. How you know, how concerned do people need to be about this potential for a real estate crash? You know, there's little inventory, but people are saying the amount of buyers who have been buying throughout 2023 might dry up kind of like those excess savings have dried up.
And when those buyers dry up, even though inventory's low, month's supply will skyrocket and then prices will come down. What's your take? Everyone's always waiting for that crash. The question I ask is what are you seeing that would lead to one? And I always hear crickets. The the people that are calling for the crash the most usually have no idea what would cause a crash.
They just know that well, we had one in 2010, so we're due. Right? Like we're supposed to have one. They don't understand macroeconomics, they're not following what the government does with quantitative easing. They don't know about companies like BlackRock that are buying up as much real estate as they can.
And they don't understand, to be frank, the fundamentals of investing in real estate are about more than just cash flow. Cash flow is sold as the foundation that you should build your entire investment portfolio on. In a lot of ways, those of us that own real estate realize that cash flow is fickle.
It's a cat. Sometimes it comes and lays on your lap and it lets you pet it. A lot of the time it just knocks stuff off your counter and makes a mess that you have to go spend money to clean up. You didn't You never know how that cash flow is going to work, but things like equity, buying in the right locations, getting a really good tenant base, understanding leverage, buying the property right in the first place, you have a lot more control over those things.
I don't know if we're going to have a market crash. What I do know is right now there are not a lot of cash flowing deals out there. We've seen interest rates double or triple and prices have not gone down. They might have dipped a tiny bit in some markets, but in general they are holding strong. I think interest rates will continue to go up and prices will continue to hold where they are because people only drop their prices.
You're a real estate agent, you know this. When you have a seller, you have a listing, and you're listed at $600,000, and Jerome Powell comes out and says, "Hey, we're raising rates." Do your clients call you and say, "Kevin, drop the price to $500,000. The market's collapsing." No. No. When does a seller say, "Hey, I'll take less for my house?" Oh, time.
It takes Yeah. They have to be on their 90 days, 120 days, pain of waiting, and they'll finally say, "What if we drop it 10 grand?" It's always the same conversation. It's so funny you say that. You go In 2018, rates were uh Jerome Powell was raising rates. Uh you know, we went from like 1.5 to 1.37 or 1.75, 2, 2.25, 2.5.
And uh I remember that summer so distinctly. I had seven listings. And we put these seven listings on the market. Then all of a sudden we got another rate bump. Mortgage rates shot up somewhere around on that one. I don't know why. 75 basis points to a full percent. And it kind of came out of nowhere.
Out of nowhere. Yeah. And all was like May of 2018 and all of a sudden the buyers dropped off a cliff. And I'm like, "Sellers, rates just went up. We need to drop the price." And all of them were like, "Man, you just want to make a quick buck, man. We just need to wait." And had they dropped it then, we would have sold right away.
But they wanted to wait, so we waited and it it was a fight. I mean prices eventually stabilized. Uh Jerome Powell eventually stopped raising rates. Surprisingly in America things just they tend to work out in the long term anyway. But I remember that panic of the moment. Like, this actually affects buyers and sellers like, Not my problem.
Don't care. You got to sit on the market for three to four months before they're willing to start dropping the price. Yet every buyer out there thinks that when the news comes out and it says rates are going up or whatever the the next economic cycle shows, they expect prices will immediately collapse.
And it's not realistic. It works off of supply and demand. How many houses are for sale and how much demand are there for them? And it's the comps that make real estate so sticky. Uh and so this is where, you know, you have sellers that are stubborn because they say, "Well, look, my house might be listed at 599, but that one over there sold for 580 and mine is way better than that." And that that ego Yes.
makes real estate very sticky. It takes many months for comps to start coming down. point. Some markets and and you see this every season, especially back to school. Right now in some markets I'm seeing some houses that were selling for six, have some active listings that are starting to stagnate around like 590.
And we're like, "Okay, there's going to be some fluctuation there." But I mean, is it like they're sitting at 400? No, of course not. These are just the minor fluctuations that we see. Could we have a little downtrend going into the winter? Hey, look, every winter you do, right? That's my take at least.
November, December is when you go buy. Don't let the secret out. Right. But in order for the real estate to drop in price to the point that it's going to cash flow really strong like people got used to, Yeah. very hard to see something like that happening cuz there's still, even though real estate is not as appealing as it was when rates were lower, it's still more appealing than everything else.
It is still the cleanest shirt in the dirty laundry. Where else are you going to put your money that beats inflation? So, my take with this book is to say, "Look, if if it's very difficult to get more income out of real estate through cash flow, Yeah. then make income out of real estate through other factors like equity and tax benefits and paying down your loan and go make your money in the old-fashioned way doing better at your job, starting a business, being an entrepreneur, actually be intentional about building the skills that people build in order to make more money, taking advantage of capitalism while we still got it.
Let's hope it stays around for a while, but we don't know how long we're going to have it, right? And then managing that money better. People don't know they often want they'll do anything to make another $300 a month in cash flow, but they won't look at their personal budget at all and look at where they could cut $2,000 a month.
That's so well said. I I have this nightmare that it we will run out of opportunities to make money and we'll just have like socialism and every everyone will be in like a tube with a Ready Player One goggles and you know, this will just be you all day long, right? That my nightmare is that because then I can't provide more value than somebody else because we're all just in the same tubes.
Yes. Uh that that scares me. I love that we are in an environment now where there's so many endless ways to make money. There is no shortage of ways to make money. Uh I mean it's it's shocking just from the different businesses that we operate from the vendors that we'll hire, you know, they'll say, "We have this perfect solution for your problem." And then we get in, we're like, we can build something better.
And as much as sometimes we get frustrated, we're like, "No." We should be saying, "Thank you." Mhm. Because if if other people aren't able to provide good value, then we can provide better value. That means we can make money. Yes. So, if we can provide more value Yeah, it's empowering. If it's same as true at our job, if we can provide more value than our co-workers, we win.
Yes. It's a great opportunity. So, I I think you're you're It sounds like your books are right right on the perfect uh path of of what we should be thinking about. Uh not necessarily the most viral path of put everything into a money market fund and just sit around and do nothing. That's exactly right.
But, what do you think though? I mean, people want to retire early. Can they retire early with real estate? It's possible, but I but the people that I know that have retired early and probably you would say the same. They worked 10 times harder than everybody else to get there. And then often times once they got there, they realized, "You know what?
Inflation is way worse than when I first started on this journey. My money's not going nearly as far as it did. Now, I'm going to go back to work." Now, my take on this is that if you get to do things you like for work instead of things you don't like, you've won. It doesn't need to be you don't work.
There's this idea in our culture that if you're working, if you're not sitting on the beach with a mai tai, you've done something wrong. That's what we all should be getting to the point I should never have to work, that that's what financial freedom is. I just don't think it's very realistic from what I've seen in my own portfolio.
You look at the second law of I believe it's thermodynamics is that if you leave things alone, they will fall apart and they will get worse, okay? I looked at my own portfolio when I stopped paying attention to it even though I have an organizational chart and systems in place, the people responsible for those systems, when they're not being held accountable, they start doing a bad job, the money goes away.
You started a business, you built it up, it's doing great, you stop paying attention to it, your employees start working less hard, stop, there's no accountability, it falls apart. Everything in life works like this, okay? Hey, did you know you could now invest in my real estate startup if you're a non-accredited investor, which means almost anybody can invest at a one-to-one valuation.
We'll talk more about what that means at househack.com and you should read the offering circular and the risks associated with that. But, let me tell you, I'm very, very, very excited to announce househack.com is open to investors of almost all walks of life, incomes throughout the world. So, whether you're international or you're in the United States and you want to invest, go to househack.com, learn more, send us questions if you have them at [email protected], and we look forward to working for you as our investors.
Thanks so much. Go to househack.com. this. Okay? Like, we've been sold this dream that you're going to buy a couple houses and then it's done. You you get to retire. And those of us that have those houses realize there's still problems, there's still things that need to be looked at. It's just you shouldn't have to do the things you hate.
I love that analogy. I mean, first of all, I I this reminds me so much of the thermodynamic law you talked about. I think Ben Franklin had this quote, "A used key doesn't rust." Mhm. Yeah, I mean, and if you think about it, it's like, "Oh, that makes a lot of sense." Yeah, you stick it in the slot every day and turn it, it actually functions, you know?
Where whereas if if you don't function, then then you rust and you fade away. I actually I have this belief, and I don't know what I'll feel like when I get to like retirement age, but I have this belief that when you buy your dream home and you retire, you die. Like, you just you rust away and you die.
And I I'm so excited about working that it doesn't feel like work anymore. And I know that's frustrating for a lot of folks because look, I I didn't love my job when I worked at Hollister. I loved it at first, but then I got a bad manager. A manager that didn't like me because I was law enforcement explorer, I was doing ride-alongs, I had like 3,000 hours of ride-alongs.
And uh the manager hated cops, absolutely hated cops. So, my schedule got cut, I got the worst duties, right? I hated working then. But now, you know, if you if we can transition to finding things that we love doing, now it's it's fun because we can take that money we build and invest in real estate.
Great analogy. Sipping those mai tais, I get to still sip mai tais. Just not after work. You don't want to work 40 hours a week? Yeah, yeah. Exactly. Food tastes best when you're hungry. Vacations are best when you're working hard. You want to have a balance in life, right? So I just had balance of a few mai tais last night, right McKay?
What What you hear a lot in our space is this formula that would say, make money or get money, borrow money, partner with someone else, buy houses, get cash flow, replace your active income with passive income, and quit. And then when you look at all the people in the space, I don't know anyone that's done that.
Yeah. Even the guys that own a lot of real estate, things go wrong. There's evictions, there's tenants, things break. You You're constantly putting money into real estate just like real estate is providing money for you, and it doesn't always come from cash flow. Sometimes the value that you create in real estate sits in equity, or it comes through tax savings, right?
But you have to be making money to take advantage of these tax savings. So, my case in the book is that if you love real estate and you want to get out of your job, get a job in real estate. Ooh. There's so much need for good real estate agents, good loan officers, good property managers, good contractors, good design people, good bookkeepers, good CPAs.
We are always looking for someone that has skills in this area as real estate investors. If you're passionate about it, go be great in that space, make money, put that money into real estate. It's still possible to do. But you got to work harder than you used to. I I have this analogy that most of us think that we're standing on the stairs and we're halfway up.
And if we're not working hard, that we're not getting somewhere in life, but we're at least not losing anything. That we have this ability to just sit where we are and we're okay. With how much money the Fed has printed, inflation is creating a situation where you're actually on an escalator and you are going down.
Oh, interesting. Not building wealth, not trying to get ahead. Your Your money is losing value. Everything is probably, in my world at least, food, gas, energy, vehicles, it's probably twice as expensive as it was three, four, five years ago. I love this escalator analogy. If you sit still, it's I mean it's moving down.
You're losing and you don't realize it cuz everyone else is on the same thing and you're comparing yourself to everyone else and you're all moving down. If you want to get ahead, you're going to have to run up a down escalator, which is going to be harder, but it's still worth doing right now. you can do it.
And you don't want to get clawed at the bottom of the escalator. I have this like like childhood nightmare that I just cannot shake out of my head. It was my mom was watching the show The Young and the Restless or something like that. I don't know, one of these like TLC shows or whatever. And the lady's on the escalator, she drops her her lipstick and it goes down and I don't know why it's so like dramatic in my childhood, but I just see it getting crushed by the claws at the end.
Don't get crushed by the claws at the end. You stay on too long, that's what's going to happen everybody, right? And you made a good point. We don't know how long we're going to have capitalism and when you move into a socialistic economy, your ability to create real wealth is greatly hindered cuz like you said, you're not you're not rewarded for providing more value.
Everybody's in the same place. It's scary. If you wait till you get all the way to the bottom and socialism kicks in, you may see a lot of the people that were upset that David Green is saying I got to work hard when I wanted to hear about passive income. We may look back at these days and say, "Oh, I wish I was in a point where if I worked hard, I could get ahead." And that's where all the haters are too, at the bottom of the escalator.
Like it's that's that's where like all the critical people are you can't do it, it can't be done. They're all at the bottom. So I'm like, "I got to keep running, man. I don't want to be in that mess." Yep. Yeah. That's what I take and there's joy in the running, right? A lot of the time in order to make more money, you have to become a better version of yourself.
Okay? You want to sell more houses, you got to be more friendly, more knowledgeable, more organized. They're all things that require you to step up your game. It is personal development that you use to succeed in capitalism. And a lot of people get excited about real estate investing, which I love. I want them to.
It's a great carrot. But it it also exposes all the areas where you're not doing great. If you look at where your money's being spent and you can't control your spending, you've you've some issues with discipline. Maybe you're relying on retail therapy to feel better about yourself, right? Maybe you don't really want to have difficult talks with your spouse, and so instead of having those talks, you just go out to dinner and spend 500 bucks, and you just use that as a band-aid, right?
When you start looking at how you're actually spending your money, it reveals elements of ourselves that maybe we've been avoiding, but it feels so good when you actually rip off that band-aid and get in there and fix that problem. I think one of the things that you mentioned about I think you said it in the discussion of property management and record keeping, bookkeeping.
This is actually I think there's a big opportunity there for folks to learn really good bookkeeping, because not only is that going to lead you to be accountable in your own finances, as you're saying safe, but it's also going to give you a skill that I would venture to say 99% of people are horrible at.
Yeah. Like, if you can run a perfectly reconciled QuickBooks or whatever program you want to use for your personal life and your businesses, you almost can't lose. But now, take that skill, and like you said, become a property manager. Like, here's here's a way you want to build a really big business, and you want to get successful starting with real estate so you can buy your own real estate, start a property management company.
Understand everything you can about bookkeeping, so you run the best books possible. You become the best property manager possible in your area, and trust me, there was a lot of opportunity to be a great property manager everywhere around the country. Everyone hates property managers. You treat property management like your clients are your customers but your tenants are your customers.
Now, you build that five-star reputation, there's no way you won't become wealthy being a great property manager, because here's the other way as well. As property manager, you become a licensed real estate agent. What happens when those landlords are like, "I don't know, man. I think the market's going to crash.
I want to sell." They're going to call their property manager. Now you've got built-in clients to sell properties from. The number one way to get buyers as a realtor is list real estate. Yeah. So you get in on the ground floor in these painful times as a property manager where all the realtors are leaving the business.
You're a great bookkeeper, you can build up five-star reputation. You're not going to have a shortage of properties to sell, then you're not going to have a shortage of buyers. Convert your tenants to buyers as well. That is a multi-million dollar business idea in any city you're in right now, but it's very hard work, but it's doable.
And you don't even see those angles if you're just thinking buy real estate, get cash flow on the side. No, nobody nobody Well, look, the first thing people say when they want to buy real estate is, "Oh, I'll do the property management myself." Most people don't know the first thing about property management.
It is a job. I say people should start by hiring a property manager and then learn and breathe and then transition to doing it yourself maybe in the future. People get it backwards. They're like, "Oh, in the future when I have all this cash flow, I'll hire property manager and have my mai tais." Should be the opposite.
Like, build your own business first, learn what other people do, and then improve on it. Yeah, and I just think that where there's opportunity, you have opportunity to build a business right now. You have opportunity to create equity in real estate. You decide the price you pay for it, you decide what improvements that you make, you decide how to read the comps.
You don't have as much opportunity with cash flow. You're dependent on what the market gives you. And a lot of people have tried to avoid that by getting into the short-term rental space. And as everyone has flocked there, what you've seen is that the demand for these is is kind of stagnating or going down a little bit while the supply is increasing, which makes it harder and harder and harder to run that business.
What I'm getting at is you don't want to run in the same direction of what everybody else is doing. Oh, you're guaranteed to fail then. Do you think we're in a bubble for Airbnb? I think that certain markets, yes, definitely. And not only that, but you're seeing even if it's not a bubble, you're seeing certain municipalities just coming in and saying, "Nope, can't do it." Yep.
Incredibly unfair to the people that just signed up for a 30-year mortgage to buy a property and dumped a bunch of money into getting it ready and energy and effort and have done everything that they were supposed to do to succeed as an entrepreneur and And the the city comes in and says, "Oh, we're just not going to allow this anymore." Oh, yeah.
And and you're up that creek. I wouldn't say that you could ever say that real estate as a whole is going to go up or down, but you have to look at the individual markets, and in many of these markets you are going to see that it becomes much tougher to run a short-term rental. And like you and I said before, there's people that are doing it, but it becomes their full-time job.
Yeah. Well well, yeah. It It's really important. Go check out the BiggerPockets podcast that we did with David Green. I I I don't know. You guys might post after me, but stay Go subscribe to the BiggerPockets podcast and wait for my episode. We talked a lot about that Airbnb becoming a job. Uh so, shout-out for for them.
Which also, I got to I got to shout-out StreamYard really quick. StreamYard, we do all of our live streaming with StreamYard and some of our recording even as well with them. They're a great sponsor of the channel. Go to metkevin.com/streamyard to learn more about them. Every single creator or somebody who wants to be a creator should be using StreamYard, so shout-out to StreamYard.
So, on Airbnb, is there a potential that in some of these markets where people have gone in saying, "Look, I had cash flow in '21 and '22." Yeah. But now they're like, "Oh, no, I need to go long-term rental." And all of a sudden then they go from cash flow or like paying their salaries or something to negative cash flow.
Is there a possibility that we're going to see some short-term rentals start getting liquidated en masse in certain markets, and could that drive prices down in certain markets? It would have to be so significant in most markets to drive prices down. I think it's more like if you get more of these short-term rentals put on the market and sold, it's going to be like pouring a cup of water on sand at the beach.
It's just going to absorb it right away. We need inventory in most markets. I mean, I've got You may live in Wichita, Kansas, and you have plenty of inventory there, but where you and I live in California, something goes on the market, it's getting offers in 4 days. So, it depends on the specific market, but I I think it could very easily some of that short-term rental inventory could be sold off.
You wouldn't even know that it happened. You would just have less competition or yeah, less competition for short-term rentals if you're someone who keeps it. It's so interesting you say that especially about California. You know, if people hate California and this idea of investing in California real estate.
Here's one of the beauties about California real estate is this democratically controlled legislature that we have. It's like 77% Democrats. I ran for governor against Newsom. I tried. I tried, okay? But anyway, I came in second place recall candidates. The The problem that you have in California is they don't build homes.
That is actually a beauty as a real estate investor because when you own real estate, the California government is basically increasing your property values because people want to live in California because of the weather or whatever it is. People do like California despite what we hear on social media.
And people who leave California are starting to come back to California or left during COVID. And so what's fascinating is when you have a government that doesn't want to build, you're really just increasing the value of all the real estate other people already own. Yeah. It's a great hedge. I call I call the California government my hedge.
It's a good principle that applies in a lot of markets because the the frequent criticism of real estate is that it's too expensive, okay? Well, what's keeping it expensive? Supply. Yes. And when there's constricted supply but increasing demand, the prices are going to keep going up. So the very reason that people argue against buying real estate is that it's too expensive is often the fundamental that keeps it a good investment and makes it a safer bet.
I mean, imagine if we actually had a government that said, "You know what? We're now creating or even in California, let's say, we're creating 20 new master plan communities up and down the the entire state and we're going to connect those master plan communities to the big cities with Elon Musk tunnels.
And let's just say we could snap our finger and do that. And these master plan communities were each 20,000 homes. That's 400,000 homes. We could snap our finger like this and they're connected to the big cities. All of a sudden, you would absolutely, almost without a doubt, see a softening of real estate prices in those cities.
Absolutely. Because I can now get to the city quickly without living in the old crap, and I could live in a beautiful new neighborhood with new schools and everything. But guess what? It's never going to happen because of government. Yeah. And a lot of people want that to happen, Kevin. They think if we could just get prices to come down that they could be an investor.
Well, here's what would happen. Yeah. It would be good for the economy as a whole if real estate prices came down. Sure. I like the average person able to buy a 100%. Okay? Well, if that happens, more of them will buy homes and they will become real estate investors. There will be more supply on the market for tenants to choose from.
That will push rents going down. That will make it competitive to get a tenant in a house. Mhm. If you don't have fast Wi-Fi, if you don't include cable with your listing, if you tell the tenants you can't make noise, they'll just say, "Screw it. I'll leave you and I'll go to the competition over there." It would actually create a scenario where real estate investing was less profitable because prices and and asset values are go are not going up, Right.
and rents are not going up, and if we got what we wanted, it would make it less profitable to be in the business. And that is a a common error that I hear people making when they're wishing it was easier. I wish it was easier cuz then I would do it. If it was easier, it would be worse for you. Yeah, there'd be less opportunity.
100%. And that's why when I wrote Pillars, or one of the reasons that I wrote it, was to get people thinking the way we are talking. Yeah. You want to run towards hard. You want to look for barriers to entry in whatever you're doing because there's less people doing it. I give an example in the book of a mechanic who works on a Honda Accords.
Everybody knows how to work on Honda Accords. It's not a valuable skill set to have in the marketplace that you can work on an Accord, right? But what if you go do the more difficult path and you go tell your boss, "Hey, I want to learn how to work on those European cars that make no sense." Yep. You made your life harder.
All your coworkers mock you. Why would you do that? That you're making it harder. That's stupid. You could just, you know, change uh fuel injectors over here. It's it's easiest thing ever. We're smarter than you cuz we're doing it easy. Well, then there's layoffs. Or they open a new opportunity for someone that because they really need someone to work on European cars, you command a higher wage because you have a rare and valuable skill set.
That is how people make money in a capitalistic environment, and somewhere along the way we got poisoned in our mind to think that easier is better. Oh my gosh, you're so right about that. I mean, people couldn't get people couldn't pay enough to get their Teslas repaired in 2018 and 19, and insurance companies are like, we can't afford to pay for this because it's way too expensive because nobody was trained to work on these EVs for for collision repair or whatever.
Uh so, you're so right, and it's it's so entertaining because I see it every day. Uh and throughout my career I've done this. I became a licensed agent, licensed broker, MLO, licensed contractor. When the drone license came out, I'm like, I'm going to get my drone pilot license, which was actually, out of all those tests I just listed, the hardest test.
It was like a mini pilot's test. You'd think it just be like, it's a drone, it's not that it was really hard. It's crazy. Still passed it. But anyway, uh I'm like, all of these barriers, mean the other agents aren't doing it. That means I can succeed. Now, right now I'm I'm regulated by by FINRA, by the SEC because I'm a licensed financial advisor.
I I just passed my Series 7 broker. We're creating a broker-dealer. There's so much regulation. At any point FINRA or the SEC could just walk in my office, go, "Give me your books. Show me everything." Right? I have extreme amount of regulation around me. But to me, I look at those and go, "Those are barriers.
That means there's less competition around here." And as long as you you run your ship cleanly, what do you have to be afraid of? So. There's a beauty in it. Then there's a joy that is in taking the more difficult road and finding that less people followed you there. And so, the reward is bigger when you get there.
It's just a shift in thinking that if people are struggling with real estate investing or they're struggling with wealth building in general, that's what I would tell like my nephew when he gets out of high school, right? Like hey man, don't ask the question of what's the easiest way to make money. Right, you're thinking the wrong way already.
You're going to end up with the herd and there's not going to be opportunity for you. What do you think about this getting a job in the real estate industry? Sometimes I've I've thought of it as almost like legal insider trading. Where it's like when you're a broker or an agent or a lender or uh you know, a property manager or you're in construction.
Mhm. You have such a competitive advantage over the other the the doctor who wants to get into real estate on the side, right? What do you think about that? Yeah, you're exactly right. You're putting yourself in an environment where you're more likely to get what you want. It's like the analogy that we often use is like if you're trying to get married, why are you trying to find a girl at a bar?
Could you find a wife at a bar? It is possible. Mathematically speaking, are you as likely to find her there versus somewhere else, okay? If you're trying to find deals and you keep going to Roofstock or you keep going to wherever, you're complaining like I can't find a deal anywhere. The people that are finding those deals are not going through the same channels as everyone else.
They're not taking the easier path. Like you said, they're a contractor. They get called because grandma passed away and the house needs a ton of work and they're like, hey, let's look at this thing. We need a quote to fix it and you're like, well, it's going to be this much to fix it or I'll buy it for you from you for this much money.
They're literally doing what we're saying. They're taking the road less traveled. Yep. Yep. Wow, that's so interesting. What do you think about this sentiment that's circulating now though about this anti-landlord sentiment, which is oh my gosh, how could you go in there and buy a fixer-upper? You know, that's that's that's what we do on a regular base.
How could you go into this neighborhood and buy a fixer-upper that's got, you know, water damage or fire damage or it's a hoarding mess or there's mold, whatever, right? How could you How dare you go in there and buy it and fix it up and take that home away from a homeowner? What's your response to that?
What would there What would the homeowners' other options be? If you If they were selling or to buy? If they were trying to sell the property. Oh, well, yeah, that's the thing. If there was no investor who was willing to do that renovation, I guess they could just walk away and let the property default and lose all their equity in it.
it's a foreclosure. Now, the bank takes it, okay? And then what does the bank do? They're going to go put it on the market, and the investors are going to go bid on the property, and they may end up paying even less for it as a foreclosure than they if they had bought it, and then the person's credit is destroyed, and all of their equity's gone.
And the neighborhood just has a low comp that lowered everybody's property values. Yeah. Now, I would point out that I'm not a fan of the people that go after 90-year-old grandma who who thinks $100,000 is still a lot of money. And they're taking advantage of people that don't speak English, or they're older, they don't understand.
But when there is a person who is I'm going to lose my house, I have mismanaged my own funds. I've got 3 weeks to sell this thing before the bank's going to take it, and then I'm going to have a uh foreclosure on my record. I won't be able to buy real estate for 7 years. You're helping that person in that situation.
So, you're really helping the seller by making sure they can maximize what they can get. Yeah. Yeah. Yeah, that's the thing. they can buy real estate in the future. So, what about once uh once the property's bought, this idea that well, if you're a landlord, that means you're renting a property to a tenant who could have been a home buyer.
That's You're not stopping them from that. Why don't What stops them from going to buying a house? Jerome Powell. Yeah. That is true. Yeah, I mean, if you look at the housing market in general, it is very difficult to buy a home. I'm not without empathy for that fact, okay? But what we need is more supply.
Yeah. It's the only way you fix this problem. In order to get more supply, you need less regulation. Yeah. We've voted the politicians in the place that have put these policies in place, and you can you can keep complaining about politicians, but it's us that picked them, right? Yeah. So, that negative energy where people just complain about things all the time doesn't benefit them.
Mhm. It's better to look at it and say, well, what is the market doing? Where are there opportunities regardless of if I agree with this party or that party, doesn't really matter with the reality that I'm faced with. How do I save my money? How do I make more money? And and what type of real estate can I buy in this market that makes sense?
Yeah, give me the rules and I'll find a way to play the game, right? So, uh what do you think of like how should people get started in actually buying real estate? Is it a good idea to get that like cosmetic fixer? Like we call it the wedge, right? Our version of the wedge is, hey look, here's a place that's selling for all use numbers that are relevant to a deal we just closed.
We go buy a place for, you know, 475. It needs, you know, flooring, paint, uh you know, the new faucets and the new countertops landscaping work, but it's in a 620 neighborhood. And so, we're not going to put in, you know, 100 and whatever that difference is, $140,000. We're going to put in like 40.
Uh so, that leaves us with equity. This is what we call that the wedge. Uh what's your take? Is that Is that Do Should people start with small wedges? Should people, you know, get into something that needs some work? What What do you usually like to see? The more Let me say this again. The stronger the financial position of the person buying, the more risk they can take or the harder they can swing without putting themselves in a bad spot.
So, my thought is we see the deals that make the most money, they're going to require the most work and the most risk. If you're someone who can't be disciplined with your own money, can't put money in reserves, haven't worked hard at your job or have told yourself you're working hard when what you're really doing is just checking in, clocking in, putting in your time, clocking out, you're not really giving it your best, okay?
Then you haven't earned the right to go after those bigger deals. And and the temptation is to say, well, where do I go to find the good deal as opposed to who do I need to become so that I can get the good deal. You guys can take down deals that maybe don't even cash flow because you make enough money from business that you can float that deal as it appreciates to a really big degree.
Like the example, I remember I was walking on the beach with Brandon Turner. As romantic as it sounds. With my ties? And we're having a like a philosophical conversation about real estate and what had triggered it was this idea that we had been raised to hear cash flow is the only thing that matters.
And I said I was looking at like a mansion in Maui. And I was like, you see that house over there? What do you think that's worth? He's like, that's probably a like a $8 million home. I said, okay. In 10 years, what are the odds that it won't have gone up? He's like, zero. Right? They don't They don't let you build in Maui.
It's on the beach. It's one of the best parts. That's going to be a $16,000,000 home in 10 years. And I said, okay. What if it lost a thousand bucks a month in rent? Everyone would say, never buy it. But you'd be losing 12 grand a year to make $7 million over 10 years. Like, why don't we ever talk about the fact that that actually would be a good investment for a person that could afford to lose a thousand dollars a month.
Now, not everyone can, right? That was kind of my light bulb moment where I realized you can make even more money in this economy if you have money. If your financial position is strong. And when we don't have a lot of savings and the first thing we do is buy a BMW or we're taking vacations that we can't really afford, right?
We're not fighting to get the promotion and competing with our coworkers. We don't realize that you're robbing yourself of that profit. It's not just the cost of the car. It's the opportunity cost of what that capital could have done if you were in a stronger position. It changed a lot for me. I realized I want to run businesses.
Is it more work? Yeah, but does it put me in a position that I can take bigger risk with real estate? Yes. And And like you mentioned, when the economy goes bad, which it has for us, it's been real Interest rates going up has hurt me badly. Our real estate team is selling a third of the houses they used to.
The mortgage company is struggling. It's much harder to make money in real estate. The properties that I have, I've run into some problems with. It's been a very tough time. But because I had so much money saved up, I can weather that storm. I just want more people to understand that that is how you build the confidence and you get into a stronger financial position, not looking for an NFT or a crypto pump that's going to make you easy money that didn't require anything of you.
Yeah. Yeah, it's interesting, too, because you you started I I can't remember your first job, but I know you were in law enforcement for a while. So, how can you walk me through that transition? Like, how did you go and and make more money? And and then apply When did you start applying that to real estate?
Yeah, that story's in the book, and it's a it's a I Here, it's a good story. To me, it's just my life, right? When I was in college, I worked in restaurants. My goal was to save $500 a week. Now, to do that, I couldn't spend a lot of my money that I made, and I had to work more days. So, if I wasn't going to make 500 bucks or save 500 bucks that week, I had to pick up another shift.
I learned that if I stayed late and picked up the closing tables, I could go from five or six tables in the night to nine to 10. Oh, nice. 40% increase in income to stay one extra hour. Oh, nice. So, I started asking to close every night, and if the other server said no, I'd pay him 20 bucks so I could close.
I'd pay 20 bucks to make 70 or 80 bucks. brilliant. You paid off your co-workers. They thought I was dumb for doing it cuz they got paid to leave, and I'm like, I just made a what, a 400% return on my money if I all the tips? Yes, that's exactly right. So, I'm working at the best restaurant I could get into.
I'm taking more tables. Then I realized that if that's a line right there. You just said you're working at the best restaurant you could get into. So, I wasn't at Applebee's. Good for you. But how did you get there? Because you need experience to get in there. Yeah, I went in there and I said, "I want a job." They said, "You don't wait tables." I said, "Let me be a busboy.
Let me be a host. I'll work for free." They let me work for like three days, saw that I was good, said, "Okay, we'll give you this many shifts a week." And then when I had those jobs, when my job was done, I immediately went to the server and said, "What do you need?" I was helping make their salads.
I was helping serve their tables. I was helping the busboys with cleaning. I was even helping the cooks bringing them sodas when they were thirsty. What happened, Kevin, was everyone in that restaurant started telling the owners, "We love David. We love this kid. He's the best guy there." So, I'm 18 and I have a job with 35- and 40-year-olds that are feeding their families with this server job, and it was challenging.
It was stressful. You You have to do things quickly. I was always learning more about cuisine. I was learning more about wine. I didn't come from a family where we ate nice food and drank wine. But, in that world, that's what it took to be good. Long story short, I graduated college with $100,000 in the bank.
My school was paid off and my car was paid off. That's amazing. I mean, honestly, it's chilling what you just said because what you did is you provided all the possible value you could with your time and energy, which is so incredible because you're not just narrowly focused on, "Okay, now I got the bus boy job.
All right, I'm going to The dishes are clean, you know, I clean the table and and now I'm going to sit here and text for the rest of my time." It's like, "What else can I do? Maybe I'll go sweep. I'll go bring some sodas to the cooks. I'll go help the service." That's brilliant. I mean, that that's clearly why you became successful.
I mean, that's amazing. you from doing it, man. There's not There's no defense. Nobody's going to say, "No, no, no, no, don't give me the Coke." I don't have to get around the offensive lineman to get to the quarterback to to help somebody else. Like, the only thing that stops us is us. And it's a mindset thing.
It's this belief that, "Well, they don't pay me enough. So, when they pay me more, I'll work harder." Oh, you just hit on another one, the entitlement. That's the entitlement of the society holds people so much back because the idea is, "Well, if you pay me more, I'll work harder." Well, that's the opposite of what you should do.
It should be, "Let me work extremely hard, and then there's no way you can work extremely hard and the people around you not going, 'Okay, we need to keep this person.' And then we need to keep this person turns into, 'We need to pay them more so they don't leave,' right? Yes, we need to create opportunity for that one.
Yep. That's my The with writing this book was for the people that never had a mentor that showed them these principles No. that they could get it there. Because what happens is I became the top server in this restaurant in Manteca, California at 20 years old. Good for you, man. went and had reconstructive surgery on my ankle to to fix some basketball injuries that were pretty gnarly.
And when I came back, instead of going back to that restaurant, I went to a nicer steakhouse in a city called Pleasanton where everybody's rich. I drove about an hour from my house to get to that nice restaurant, an hour each way, but my tips tripled. Yeah, well, you went in with now experience. Yes.
You went in with no experience, got experience by providing more value, got way more experience than you thought you probably would have even bargained for, and now use that to increase your income. That's it. And then and then I started at the bottom of the totem pole, and I had to learn even fancier stuff, even more expensive wine.
Like the pressure was on. I'd go home and Google stuff about cuisine. How do you pair lamb with a certain kind of wine? Cuz when my boss walks by, I want to hear him I want him to hear me explaining to the customer things that other people weren't doing. Well, what do you think happens when the celebrity walks in?
It goes to me. John Madden, Al Davis, if you know E-40, he's a big rapper in the Bay Area, he used to come in, right? Uh the Oakland A's would come in all the time. I was getting the top people that were going to tip the best, that were going to share the best experience because I was the top waiter.
And even though you're just waiting tables, this isn't like this isn't the boiler room where you're making a ton of money. It consistently adds up. That was the money that I ended up making when I graduated college that bought my first real estate. And then I became a cop and it became starting over there.
What do the good cops do? How do I become a better cop? What do I have to learn? Who are the people I should emulate? What do I need to change about myself to be good in this environment? That led to overtime opportunities. That led to instructor promotions. That led to all of these things that made it easier to make money within that industry, which then went into real estate.
That's incredible. I mean, it's it's even just to the extent of you suggesting after work, it's okay, what can I do to be better at my job? I'm going to tell these stories or provide more value as as a server. And then the people around you are like, how how does he know so much? How did he learn all of that?
We didn't teach him that. And then they think you're like a genius, you know? And it's it's just this like it makes them then go Well, may maybe I need to figure out how to learn this stuff. And then everyone around you works better and more efficiently. When I took that first restaurant job and I started as a bus boy, there were already guys that had been working there as bus boys before me.
Yeah. They watched me get promoted over all of them. And there was some animosity there. It wasn't cool that I jumped ahead, right? Well, what you found was that they all started doing what I was doing and their promotion came much quicker after mine did. It literally did what you said where the bar was raised for the whole restaurant.
Yep. My boss saw that and put me in a position of authority because she wanted me setting the example. So, now when the 20-person banquet comes in, it's going to David. He deserves it, right? I ended up house sitting for them. Like my boss loving me created privilege. That that's how it would often be spoken about, right?
But if you were a boss, you would give the most authority to the one that gave you the biggest return on your money in your business. And then the the other principle was when you hit a ceiling, which you usually will at most jobs, you don't feel bad about leaving if you know that they couldn't create enough opportunity for you.
Oh, that's interesting. So, when you outgrow the company, basically. Ah, yeah. And I went to her and I was like, "Look, I want to make more money. What can I do? Is there another management position?" She's like, "I'm sorry, David, you're already at what we have. This is the top." And see, that's where the the restaurant's like Hey, you know, if you're maybe at a larger chain, it's like, "Well, there's corporate or it's district management." And so, larger companies do have more of that upward mobility.
But you're right, like at some point cap out at at at many jobs. And then but then you take all of that experience and that work ethic. And you start over and you do it faster and better the next time. That's exactly right. There is a rhythm to making money in a capitalistic environment and actual blueprint that can be followed.
And when you get a taste of it, it is so empowering. It feels so good, right? I wasn't going to work every day mad that I had to work. I was going to work focused like it was a sporting event and I'm like, how do I give the best performance that I can when I get there. Every day before I go into work as a cop, I'd be praying, all right, help me do the best job I can, help me be as safe as I can, help me to learn as much as I can.
And then I start getting chosen for all the instructor positions. You get a little bit more pay with that. You get a little bit better schedule, right? I'd have a point if you're an instructor that day and you're not actually working a beat, maybe you get all your work done in six or seven hours, but you're in a 10-hour shift, that's 3 hours to do real estate.
Yeah. There's other opportunities that would come from that. So, how how did you transition then from uh law enforcement to real estate? my real estate agent's license cuz I was just referring all my buddies to realtors and then they would come back to me and say, "Hey, the realtor doesn't know." And I realized most realtors don't know as much as me cuz I just owned some rental properties.
Well, and if you're also a cop in the area where you're buying, you know the streets. Yes, exactly. You know the areas. I could articulate to my cop buddies why they should buy a house instead of rent. I could overcome all their objections. Well, it's cheaper to rent. Well, what if you put three cops in the bedrooms here, they all need somewhere to rent, you're going to be living for close to free, does it still sound cheaper?
I didn't think of that. Right? Then you sell them the house and then next year you can go tell them, "Hey, do you want to buy this one? It's got five bedrooms instead of three." You could do the same thing. So, I started selling so many houses that it didn't make sense to stay in law enforcement and I had developed some injuries over the time, so I just made the jump and then and then it's the same thing we said, you're at the bottom.
You're selling houses uh like I was not a very personable guy. I was a cop. I It aids you a little bit in business. a ton, man. And like you get things done as a cop by having a rigid personality. You get things done as an agent by having a very flexible personality. So, it was like the most stiff person ever going to yoga.
Uh-huh. And I did not like it. Like people in my life will tell you I was it was a hard transition for me. But building those skills to be more personable, to be more articulate, to explain things, to overcome objections, led to me being able to form a real estate team and not just be an agent, right?
So, as a solo agent, the most houses I ever had in contract at a time was like 12 in escrow. And that's a lot of work. Very hard, right? As a team, we hit 53, 54. Wow. Right? It opens up doors. Now, new challenges. Running a team is completely different than selling the houses yourself. Like the skills that it takes to be a good agent are not the same as the skills that it takes to run a company.
going from customer service to business building. Very much so, and I started at the bottom and I sucked at it, right? But you see this pattern of like if you show up every day saying I'm going to work my hardest, I'm going to see the people that do it better than me and I'm going to copy them, I'm going to figure out what the client needs and how we're going to meet the demand of the market, money finds you, Mhm.
right? Versus the people that we've hired that are like, I don't want to have to show that person a house that's far away from me or I don't want to hold an open house this weekend. I wanted to watch football. Like those are things that crush you cuz at that open house you might have met two or three clients.
One of them could have been a neighbor that you took the listing that you then sold their house and got a buyer out of that deal. Like Yeah. these exponential things that create wealth only come when you're in the game and you're playing it. And I'm passionate about trying to get people into the game, right?
sure. And when you're hearing the the point of view of real estate investing that hey, just buy some properties, they take care of themselves, sit on the beach with a mai tai, you're not in the game. Oh, for sure. Well, what's so interesting you said that about the open houses, I had uh this I I I realized how beautiful open houses were as an agent when I could go back and calculate that I was making $1,000 to $2,000 an hour from open houses because you're really shooting fish in a barrel.
The problem is we don't think about it that way because we think we do the open house, then we go home and we're tired and we're exhausted. Oh, I had to put all those signs out. Oh, it was 5 hours out of my Sunday. I could have been watching the game. What a pain in the butt. But, the business cards you handed out, the the the connections you made, the sellers who were going to sell in the next 6 months who came in to survey the market and get to know you and see how you run your business.
You didn't even know. They're like, "Oh, I'm just a neighbor." And you're like, "Oh, it's just a neighbor." No, that's a future seller, right? Those all of those connections that just makes so much money per hour. But again, the problem with our society is we're we're jaded to think that, "Well, if I don't get paid more up front, I'm not going to work as hard." But if you actually work really hard at that open house, knowing it's going to come, it's just going to be delayed gratification, then then then you do what nobody else is doing.
That is in the book. I talk about that exact problem is people don't want to hold the open house cuz it's not guaranteed money. If you paid them $25 an hour, they would go. But like you said, you made $2,000 an hour. I talk about the 1099 mindset versus the W-2 mindset. And most of us have sort of like been born into the matrix where we were shown W-2 jobs, right?
I show up, I'm at a physical location, they pay me money to be here, and while I'm here, if I have to work, that sucks. Versus a 1099 mindset that gets no security. There's no floor, but there's no ceiling. There's nothing that stops you from being able to do more. You have to deal with uncertainty if you want to get the big payoff.
And you And in the 1099 world, I liken it to a cat that has to hunt its own food. But it gets to pick what it wants, it gets to eat really good, it gets to be like buff and strong and powerful because it's hunting versus a house cat that just wants someone to bring it tuna. When you're the house cat, you don't get to choose what you're given.
You You have to And then everyone complains, and they grumble, and you hear all this, "It's not fair. I don't make enough. There's no opportunity. The government needs to do something to fix this for me." The house cats never talk like that. They're like, "I'm just going to go learn how to hunt and find what I want in life and they're happier people even though they have less security.
Yeah, I I think that's true. People always wonder like well what you know what is the definition of happiness and I I think when we're 18 or whatever people think oh okay well you know, I'm going to get paid six figures and I clock in at 8:00 out at 5:00 when the reality is it's usually not money. There's some degree of money helps because then you don't have financial stress.
Once you get above financial stress that's great. I think statistically that's like 70 80 thousand dollars a year. But beyond that more money usually doesn't change much. What what changes happiness for people and sort of a base level of happiness. So we're always going up and down on that base level.
But what raises that base level is failure and achievement. Right, getting through hardship but then coming through that stronger and then succeeding. Because now all of a sudden you get almost this success high. Yeah. And then it makes you want to okay well let's try something else. Okay, that's not working.
Let's try something else. Some people call that flip-flopping. I I call it like necessary. You have to change and just keep looking for that success being that house cat, hunting. Tony Robbins refers to that as progress. He says human beings are happiest in life when they are making progress. that. If you think about every time in life that you've been at a peak it's because you were seeing that you were making progress and in the book I actually in the offense section that pillar I talk about ways to hack into that part of your mind and measuring things so that you see your progress and you stay motivated to keep going when the money's not flowing in yet.
Yeah, I like that. Progress. Yeah, I did not know that about Tony Robbins. I've I've read Tony Robbins books some of them but wow. I mean that's a perfect way to say it. Yeah, and and if you think about the W-2 mindset that says I want to go to work and I have to exist and I have to be here and I'm in a bad mood.
You're not making progress. That's why Congress is so unhappy. There's no progress. That's amazing. So what do you recommend to like the 18 year old today? What what do they practically do? Like step one right now, you know, they're watching I'm like I want to be the house cat man. Like I I I get it.
Capitalism. okay, I'm in. Step one. Can they look themselves in the mirror and say that they're doing the best possible job with the job they have right now? Let's say they hate their job because they're working at Jamba Juice and they're like, I I don't even like this job. Are they the best Jamba Juice worker in that store?
Ooh. Okay. Are they tracking how fast they can make a smoothie compared to somebody else? Are they literally looking at the steps? Like what I would do, and I'm not exaggerating, when I was in the restaurants we had to make our own salads, pour our own soups, run our own food. We didn't have support.
I would visualize what the process was to make a salad, and this sounds cheesy, but like I can still see it in my mind. You had the different bowls for the different dressings. Your my left hand would be trying to grab the bowl that I needed while my right hand was reaching up into the right and opening the salad container, grabbing a handful of salad, which was the same every single time.
At the same time, the bowl was coming out, the leaves of the salad were going in there. My right hand would go to scoop the dressing as my left hand was grabbing the fork to stir it. The dressing would go in, I would switch from my left hand holding the fork to the bowl, my right hand would grab the fork.
I would stir it. I would visualize this process, which people think may sound extra, but when you're stressed out and you're super busy, saving 7 seconds on a salad, if you're making like 30 of them in a night, when there's a point where every second counts, was what made me faster than the other servers, and I could keep up with the table rush because I would do that with everything.
If they're on cruise control in Jamba Juice and they hate their job, they're going to be on cruise control if they get a better job, and they're going to lose it. Oh, wow. you get to be you're the fastest person at Jamba Juice. Now that like I what I tell my teams in my businesses do it faster, better, and with less mistakes.
You're unfireable, then. Yes. So, you're faster. Now, are you doing a better job? Are you giving better service to the people that walk in? Are you cracking jokes with the customers? Are you recognizing that person's waiting a little long time? Let me say something nice to them. Let me give them a free something to make it easier.
Let Let get them to come back in. And are you doing it with less mistakes? You control that, okay? What I found is there's a measure of faith, but when you are doing that every single day, if your boss is not giving you the opportunity, which they may just not be able to, when you go get the better job somewhere else, you become the best person there, too.
Because you built these habits, right? And it was somewhere along the way in America we got away from that approach that we had that made us into this amazing country is we took pride in our work. You went to work every day and said, "I'm going to learn a trade. I'm going to get good at whatever that thing is, whether it's writing a book or stacking bricks or or being an architect or keeping somebody else's books or being a CPA." There was a I want to be the best at this thing.
They knew they were going to competition. The good news is if you're the person that takes that route today, there's no competition. It's amazing. I mean, this is like music to my ears to me. What you're saying is is you're so right about everything you just said. And I love this idea of how with your visualization, what you did is you went to the micro.
You know, I think people think like, "Oh, yeah, I'm going to run a business and it's going to be really efficient." And then they think of it from a top level that oh, I'm going to I'm just going to make it efficient. Well, well, how? How do you make it efficient? You make it efficient because every little micro thing adds up.
And then the efficiency of every little micro move makes the sum so much more productive. It's it's as detailed as like why is every employee typing every property address out every single time they're writing an email for real estate when everybody should be taught to have shortcuts. Okay, it's it's escrow 12, boom, types out 123 East Main Street, Ventura, California.
Like now they wrote two they had two or three keystrokes as opposed to 25. Right. Like all of those little micro things add up in a massive way and I think that's what you just described. I couldn't agree with you more. That's about the pursuit of excellence, which is one of the chapters in the offense book.
Oh, wow. So, what I'll tell the loan officers that work at The One Brokerage, that's my mortgage company. They'll tell me I'm busy. I don't have time to lead generate, okay? And then I'll sit and watch them work. Oh, no. And I'm just watching as they move the mouse through the different screens that they're trying to navigate.
And I'll watch them do it and I'll say, "Let's have a race. Let's see which one of us can get through this faster. You've done this for years. I just watched one time how you did it, right?" But I'm visualizing where the parts of the screen that they have to click when it's a process they do over and over and over, right?
And I'll beat them every time. Because I'm focused on how quickly I can click through where I am to get to the part where I even have to type something in, right? Okay? They're just on autopilot. I'm here. I have to work. I'm typing at a speed that's comfortable for me. I'm thinking at a speed that's comfortable.
And then I get the excuse of saying that I'm busy. And I'm not trying to sound like a tyrant, okay? They're in a 1099 position where they have unlimited income potential, but they are taking a long time to do basic tasks that keep them away from the dollar productive activities that are going to make them Right.
money. We control that, Kevin. No one is there stopping them from typing. There's no one moving the computer around like when you're playing a sport and you have a defender. It's our own selves, our own brain, is what stops us from making money. So so relatable just to this idea of when I got into the real estate industry, uh yeah, I'd have a listing and somebody say, "Oh, we're going to send you an offer." I go, "Great.
When can I present it?" You know, I can meet my seller in 45 minutes. They're like, "Oh, I got to drive to the office. And then then I got to write the Oh, then I need to make a coffee and then I got to write the offer and Ooh, then I got to get signatures. It takes them like all day to write an offer.
It's like all that work. It's like well, no wonder you're busy. It takes you all day to write an offer. Uh fast forward to to the system that I got down is I had a laptop standing in my car. I had templates for drafting the offer, templates for signing the offer. sheet made with the client's name already in it.
All of it. It's It's not that hard. Uh and 99% of these offers uh the details are the same. You're just changing the parcel number, the address, the client names. Right. The vast majority of it is the same. You're using the same forms. There's no excuse not to have the same essentially cover sheet and format and escrow opening email, you know, template in your DocuSign, whatever.
There's no excuse for any of that. So, we should get this down to Should be 10 minutes. Offer should be done. 100% and you shouldn't consider writing an offer work. Okay? That's just a thing I have to do. It doesn't count as work. Work was how many conversations I had, how many houses that I found for a client that they might like.
Those were things that counted as work. Nice. I I had a thought a minute ago. I'm trying to remember It's all right. what it was It's those efficiency sheets though. I mean, you're right. It's It's probably related to just that because I think that I really like this thinking down to the micro. How can you make all of the little steps that you're doing in your life slightly more efficient?
And it's your responsibility to do it and nothing Everyone listening to this can improve their performance. It's a different way of thinking though cuz it takes the attention off your boss. Right? My real estate agents will complain the buyers aren't motivated. Like, I want an easier client to sell a house to, not I want to be a better agent.
Like, well, what can you do to increase their motivation? How can you find them better deals that they would be happy with? That's a completely different question than it's their responsibility, right? I liken it to the person who's having a hard time dating, okay? Ooh. They can't find a spouse. They can't find a girlfriend.
They're just struggling. Most of those people think my one is out there. Uh-huh. If I just wait, I'm going to bump into the one that likes me for me. It's going to be okay that I'm 35 years old and I live with my mom and I eat Cheetos all day on the couch and I don't have any confidence and I I'm not funny and I'm not in shape and I'm not any of the things that the opposite sex wants, okay?
I need to find the person that's just right for me. And some people you could say, "Listen, you're the problem." There's a thing that women like and if you become more of that, you're going to have your pick of which one you want. And if you don't become more of that, you're always going to have this problem.
You control this, right? Some people get angry at that. They don't like being told that they are actually empowered to fix the situation, okay? They want to believe this dream that there's a perfect person out there for them like they saw in the Disney movies and they don't have to change anything. I think a lot of people go through life doing jobs like that.
Mhm. My boss wants me to be there at 9:00. I don't like it. I'm going to find a different job. My boss micromanages me that meaning that they want me to get things done in a timely fashion. I don't like it. Let me find another job. This job's hard. This job's complicated. This job doesn't fulfill me.
You see what people do in dating happens in the workplace, too. But the people that are good with the with their dating have figured out I got to become what the market wants. And the same thing is true in capitalism, right? So, I'm just passionate about the people that don't like where they are in life.
I That's great. You're listening to content like this. You should be. It's not enough to know it. Are you doing the best that you can with where you are? Because what I found is when I did, I hit a point that I recognized it doesn't make sense to work here. I need to I need to step up. And if my boss couldn't provide the opportunity, I had no guilt about finding a better job.
And I made more money, and I built more skills, and I improved myself, and then I hit a ceiling. And And success for me came just like a series of stairs. It was just stepping up consistently over and And even right now where I am, if I want to get to the next level, there are things that need to change with me.
I need to be better at holding employees accountable. I need to be better at paying attention to detail. I need my energy levels to be higher so that I can come in focused every single day. And if I don't do that, I don't deserve more money. Yeah, I think I like this idea of the stairs up. I think we generally think we we we need the rocket ship, you know, with the lottery ticket.
But that's not how you build all of those micro efficiencies or what you were saying about dating and capitalism. It's almost like dressing a real estate property in the uniform. It's really hard to sell a property when there's dirty clothes all over the place and the paint isn't even, you know, tidy and and it's dark.
So, you change the light bulbs and you touch up paint and clean a little. It's not that hard. "No, no, no, the perfect buyer isn't going to mind the dirty underwear on the floor. It'll be perfect for them." Yeah, no, no. change the property, right? It's a great example. I I don't have experience really dating other than once because why my wife went through this.
And what's incredible is I always wanted a girlfriend, but all I was doing all day long was playing World of Warcraft. That's a great example, right? Yeah, so like I literally I was love that? No. I was You went to my back then MySpace page. Right. And was it like me being out there happy in the world and productive?
It was screenshots from World of Warcraft. Right. My identity was sloth and not working, right? That was my identity. And so it's really weird, but I I went into 2008 January. I quit World of Warcraft. I started running, working out, uh and not not much. I'm much more of a cardio guy than a weights guy.
I don't know if that's obvious. But anyway, then you know, then I I would go to the beach, so I wasn't like super pale in in Florida whatever. And when I did all these things, I met my wife by like April 1st. You know, we've been together Complete coincidence? Do you think it just happened to happen or do you think there might be a correlation?
I think it's what you're saying, man. It's Yeah, you you've got to you got to set yourself up so you're actually marketable. A marketable product. What do What do other people want? And And it works in dating, but it works in capitalism. It works with making friends. If someone's listening to this and they don't have any friends, maybe you're just not a good friend yourself.
Maybe you're selfish. Maybe you're boring. Maybe you don't bring anything to the people in your life. And that's not It's okay to say that as long as your next step is, "What do I have to change?" Right. It's a completely different way of looking at the world than what they get told by the average TikTok influencer that wants their views, wants their follows, wants their subscriptions, and says, "You're perfect the way you are.
Let me tell you a way to make money that doesn't require you do anything hard. It's just a lie. What do you think about like the whole Andrew Tate is I don't know how much you followed Andrew Tate these days, but he's obviously pretty big and you know, some people call it toxic masculinity. Some people are like, "No, he's motivating people to get off their butt and work." What's your take on Andrew Tate?
Let's let's say both of those could be true, okay? He has some views that are that could be considered toxic and he also is motivating people to get off their butt to work. Why not do what he does when it comes to motivating yourself? And then when you get there, don't live the toxic life that you don't like about him.
Why don't we have more people that are like, "You know what? That's a good point. I'm going to get in shape. I'm going to make more money. I'm going to be intentional. I'm going to build better relationships, but when I hit that peak, I'm going to get married and be good. I'm not going to go date around." If that's what your problem is with Andrew.
Interesting. Interesting. Nothing stops people from doing that. Yeah. Yeah, pick pick and choose what you like, you know? And I I I say this even just about other YouTubers. People people are like, "Kevin, I hate this about you, but I like this about you." And I was like, "Well, take what you like and just ignore the other stuff then, you know?
Pick and choose." When I was a cop, I would look at the cops that were really good in um stressful situations, okay? But they were maybe terrible talking to people when they were amped up. Uh-huh. I copied how they acted when they were stressed out and I ignored what they did when they were rude to people.
Then there were other cops that had a great mouthpiece. They could talk them they could sell snow to an Eskimo. And I was just fascinated like, "How did you do that?" And I would want to be like them. But I didn't want anything to do with their physical fitness. Uh-huh. Like we all recognize greatness in certain people, okay?
There's a musician you love that makes great music, but you would never want your hair to be like theirs or something. That is what smart people do is they look at who's good and they emulate that, okay? they want. Yes. Interesting. criticism of other people actually hurts ourselves because our energy moves away from how could this person benefit me and it moves into I'm going to criticize them so that I don't have to change and it only hurts us.
You just end up playing more World of Warcraft and not having a girlfriend. Hey man, well that was fun, okay? So, um okay, some some different topic things. Uh who's going to win the election? Oh boy, man. I'm I'm I'm kind of like a pessimistic person in general. I always plan for the worst-case scenario.
It's probably my law enforcement background. I just assume the worst right now. Still jaded. In a sense, yeah. I I am nervous as a Californian that Gavin Newsom can just pull the wool over everyone's eyes. Like we live in this state and we've seen the objective measurables. But he's so charismatic and people tend to make decisions off that.
That like I would not be surprised if he just charmed the whole country and stepped in and became the next president. That you know, it's actually it's so funny you say that. I was live-streaming uh the Republican debate and then afterwards Fox interviewed Gavin Newsom. And there were comments popping up.
They're like, "I had no idea this guy was so likable." Even though some of the stuff he was saying was like, "Dude, you're lying about that." Or whatever. Like, "Okay, that's true, but that's what I always like to fact-check." But it's like the way he says it is great. he That's how you become a good politician.
It's not from doing things well. It's from making people like you, right? But here's here's my take on it cuz some people listening to this will support Gavin, some won't, some will get angry, some won't. It really doesn't matter. It matters who becomes our political leaders, but it doesn't destroy my ability to be happy, okay?
If we have a certain political party, like let's say we have the one right now that stays in place for another 4 years. There are ways to succeed financially and otherwise in that economy. Yes. Getting mad and just screaming about who the person is doesn't benefit me. Mhm. Right? I want a better life.
If this person becomes president, this is the road that I will take to get there. If this person does, I'll tweak it this way. But ultimately, keeping my attention on what my goals are stops me from getting angry about things that I can't control. love that. That's great. Focus on what you can control than what you can't.
There were some people who I I I see they write these comments. They're like, "I would never buy real estate until Biden's gone." They're just shooting themselves in the foot. It doesn't make sense why they Like I don't know if it's like a uh if it's idea in their head that that like that philosophically they've proven a point or something.
But like the market doesn't care that you waited 4 more years to buy real estate. You just are 4 years behind on paying down that mortgage and 4 years of rent increases that you missed out on. Nailed it. What about guns? More guns or less guns? I'm kind of a fan when it comes to that of the state rights.
I I go in general to everything that we argue about, abortions, guns, I don't know, whatever other hot-button topics that's going to piss everybody off. Yeah, yeah, yeah. Let the state choose. And if you like it, go to the state that has it. And if you don't, go to the state that doesn't. California, but you hate their gun policies?
I mean, I think a mature person would just be like, I mean, you could vote for it, but you're going to get outvoted. The I think in general the majority rules even if I'm in the minority. You have to If you believe the majority rules, it can't only be when you're winning, right? So, I'm a proponent of guns.
My My law enforcement career, I don't think I ever saw anyone ever commit a gun crime with a licensed weapon. Yeah. 100% of the weapon crimes that we saw were people that were not supposed to have them, right? But I can also recognize that if like everyone else around me doesn't want them, my ego can take a back seat and I can say, "Okay.
Like if I If that's that important to me, I'll move to a state that has them." And I think that trying to keep the whole country in the same uh value system is what's causing the nasty fighting between everybody. If it was just like, "Hey, you got that corner, you got that corner. Go to your own corners." we would see way less anger between the two political parties.
How'd you become so logical? That's a good question. Somewhere along the the process of waiting tables and working in law enforcement and and running a a real estate team. Great job. I mean, it's really incredible because it's usually I mean, there's there's so much emotion, especially today. I think to some extent social media enhances that, specifically short-form social media.
Now, what's your take on that? Like the Instagram shorts, the TikTok shorts, the Twitter, you know, the viral kind of headlines. My take on that is that nothing in life is free, okay? People think that if I get my education off Instagram or TikTok or YouTube, it's free. It's not free, okay? And that's not bad, but no one does things for no reason.
That is a human nature, right? That's why capitalism works because you're incentivized to do the things that people want to get what you want. It's why this is the the best political or economical system you could have. When you're watching short-form content, the person is making it for a reason. They're trying to get views because they could get more subscribers, because they could be monetized in some other way, or they're putting you in a funnel.
That doesn't mean it's bad, it is reality. So, when you're watching a 8-second clip because you've decided that you're only going to watch 8-second clips because you're not going to discipline yourself to look at more content. You've also put yourself at the mercy of somebody who does not have your best interest at mind.
They might, they probably don't. They have their best interest at mind, and they have to give you some click bait, they have to give you some sensationalized thing. This is why Andrew Tate blew up so much as he was able to say something controversial in a short period of time. It pissed everyone off, but it got everyone talking about him.
Wow. Understand how that world works, and if you choose to get your information from free sources, there's still a price you're paying. You're going to have to weed through what you're eating and pick out the bones. There's going to be a lot more, or they're going to be putting unhealthy dyes in that food, right?
Like, it isn't all pure, and I think as long as people are smart when they show up and they realize that, they're going to be okay. But most of what I my my like uphill climb in life is I'm trying to get people to stop believing the stuff that they heard in these 8-second clips. They've got this belief that like no, the perfect girl is out there for me and she's going to like me for what I am, Right?
It's the It's the Dan Lok. Yeah, you you got to stop thinking that the world owes you what you want and start thinking well, how do I become what other people want, right? Like that is in general my friendship with Kyle, he's here with us right now. When I when we were first becoming friends, I was thinking like you know, what do I wish I had in a friend?
And how do I become that for someone else? And it led to me having a lot of friends. I've been the best man in four weddings. Oh, wow. Right? But it's a different way than like let me just go find the friend that makes me feel good. Wow. And not think about what that person would want. So in in pillars I talk about how in the defense pillar, we are unaware and ignorant of how much money, energy, and effort is spent to separate us from our money.
Wow. are professional marketers that are incredibly skilled at making me think I need this thing that before I watched that commercial I didn't even know I needed. Making me think that my life isn't good enough unless I have that. They are smarter than me and they know that they're in a battle. I'm wandering through a battlefield of economic proportions, clueless that there's bullets flying around me, not realizing how many people are trying to separate me from my money.
Sure. And it's not until you start tracking that money and you give it a plan. I want to save this much money to to buy my first house or to pay off this debt. That's when you become aware, oh my god, everything I want to spend money on everything. Right. It's so hard. Like I heard you talking earlier about a new wallet you have, right?
You have cash again for the first time. Isn't it harder to spend cash than it is to put something on a credit card? Oh my gosh, yeah. painful. Apple Pay is dangerous. Yeah, it hurts to be able to spend money in cash. That's how it used to be to spend money all the time. We've got money that just flows out of our account like nothing and we don't even think about it.
So Good point. in in social media works the same way. A lot of where we spend our attention, these are not our friends. Interesting. It doesn't mean you need to be paranoid. It doesn't mean you need to get bitter. It doesn't Just be critical. Because I mean like obviously so you you have books that people can buy.
You know, I have things that people can buy as well or invest in or whatever. Everybody has something, but that doesn't mean the like just because somebody's selling something that the the value is bad. Correct. It's just on the individual recipient to select, "Okay, well, I agree with this. I like this.
I You know, maybe I want more of this. Maybe I want more detail of some of the things you hit on." And someone buys your book. Or or whatever to get more detail on that. Is that what people have to do? Is that what you're saying that people have to sort of segregate? Like, "Okay, do I like this underlying content?" Or what do you what do you recommend people do?
Yeah, when you dated your wife, did you just find the first person that would talk to you and say, "I'm going to marry her and see how it goes"? It would no. There's like a process we call dating or courtship where you're evaluating each other to decide would this person be a good fit for me? And part of that is do they have my best interests in mind?
Why do we not look at these educational opportunities the same way? Yeah. I see what they're selling. They're making me want this thing. Is this a person that I can trust that what they're telling me is going to get me to where I want to go? And do I want my life to look like what their life looks like?
When you see some 24-year-old with a rented Ferrari talking about how you can have this too if you just take his course on crypto trading or whatever, odds are this person is full of it, okay? And like I you should be expected as a person who's going to pay the money to do a little research before you say that's the road you're going to take.
And one of the ways that in my life that I look at making sure I'm not being deceived. Because people can make claims all the time. Yep. Is does this thing they are selling me work at other areas in life, okay? They're saying you can make money easily, I say, "Can I get in shape easily? Can I make my partner romantically happy easily?
Are really good strong friendships easy to make?" No, they all have fundamentals. If you want to get in shape, you're going to have to play defense, which is watching what you eat, and offense, which is exercising. And there is no way around that, okay? The ab roller and the thigh master and all of these things that were so popular cuz they were easy, they didn't work.
Shake weight, man. Yeah, the shake weight, there you go. Like, but everyone buys them because that's what they're looking for, right? If you want to try to avoid being taken advantage of, just ask yourself the simple question of do other things in life follow the same principle and work? Can we get a shake weight on the table here?
Hilarious. Wow, man. This has been really insightful. What What am I missing? What what What else should I be asking you? Like, what Should people wait until rates go down, I guess? Like, maybe What do you think? Or just buy good deals now? Like, I don't know. What What else? Let's use a sports analogy.
Let's say you're a football team, okay? And what you want to do is is throw a long pass. That's the equivalent of I want to buy real estate. And And it used to be that the team that you were playing was stacked against the run, and you had a lot of opportunities to throw the long ball. You did really good.
That's the last 10 years of real estate. Okay. Now they're getting through. Now Now you're looking like, "Oh, man, they're in a deep zone. I got nowhere to put that ball in, and my margin of error is very small." Does that mean you should quit playing football? Mhm. Or does that mean you should look to run the ball, or throw shorter passes, or find a way cuz the defense can't be strong at everything at once?
Economies are like that, right? I What I'm seeing is there is much more opportunity in business than there is in real estate investing. That doesn't mean don't invest in real estate, but I maybe I was 80% thinking about putting my energy there, now I'm 80% putting in the business. Okay? If you're not willing to adapt, you just get frustrated and you complain and you scream and you bang on your keyboard and you you talk bad about whatever people are doing stuff.
If you're willing to adapt, you don't get stressed. It's like, "Okay, what are the run strategies I should be learning? Who's a good running back that I could be following? What are the people that are making money in business, and what principles are they following?" And if we do go into a recession and it becomes harder to make money in business, well, real estate will probably be cheaper, and you start throwing the ball again.
That's my whole point of this three pillars approach to wealth building is it doesn't pigeonhole you into only one way to do it. You don't get these people that are like, "Well, I have no money. So, how do I partner with someone to buy real estate who also has no experience?" Like, these are disasters.
You don't want to end up in these kind of partnerships with real estate. Oh my gosh, yeah, no kidding. Which we talked a lot about on the Bigger Pockets at Bigger Pockets podcast. Which definitely watch that when it drops. So, this is amazing. What am I missing? Just the idea that we are in charge of our own future and it is not going to be easy, but that's okay because everyone listening to this has been successful at something.
Okay? We all have a genius. And those that are good at whatever their thing is know that it didn't come easy. They had to perfect the craft. If they're a great musician, if they're great with fitness, if they're a great conversationalist, if they're great in social settings, they put effort into developing that skill.
Business is just another thing. Finances are just another thing. There are fundamentals that you can learn. And if you are willing to self-improve, you can do this. It's getting all that bad information out of your head where you've been told it's supposed to be easy or real estate will just provide a bunch of cash flow so you don't have to do anything.
Fall in love with the process of becoming great. Wow. What that's that's so amazing. How do people get in touch with you? How do they buy your book? Shout yourself out. Thank you for this. Thanks, man. They could go to biggerpockets.com/pillars. They could get the book there. And please do and then and then let me know what you guys think about that book cuz this was the hardest book I've ever had to write, but it's probably the one I'm most proud of.
They can find more about me at davidgreen24.com or spartanleague24. Sorry, let me say that again. At davidgreen24.com or spartanleague.com. That's the mastermind that I run. Or they could just look me up davidgreen24 on social media and send me a DM. Amazing. Really amazing. Incredible nuggets in this.
Love it. It should definitely motivate you to check out the book because it's If got nuggets like this. It's it's going to be amazing. Thanks, man. ffrath .
Comments 0