Mindy Jensen: Have you thought to yourself, it’s just too hard to invest in this market? Or it’s too late, I’ve missed all the good deals. On today’s episode, we are going to hear a story that will make you believe that investing in real estate and reaching financial independence is still possible, even in 2024.
Mindy Jensen: Hello, hello, hello and welcome to the BiggerPockets Money Podcast. My name is Mindy Jensen and with me as always is my real estate believer co-host, Scott Trench.
Scott Trench: Thanks, Mindy. I really appreciate all of these wonderful creative intros that you come up with every week. BiggerPockets has a goal of creating 1 million millionaires. You’re in the right place if you want to get your financial house in order because we truly believe financial freedom is attainable for everyone, a matter when or where you’re starting, or whether you live in a great investment market but choose voluntarily to forego it and invest in another state hundreds of miles away. Today, we’re going to discuss how David and Morgan started their real estate investing journey in 2020 and scaled their portfolio to 10 properties in just under four years. We’re going to talk about how they plan to continue to scale their portfolio to reach their five number of $70,000 a month from real estate investing and how they’re making it work in this market cycle, including their most recently purchased deal here in 2024 that produces a great cash-on-cash return with an 8% mortgage. David and Morgan, thanks so much for hopping on today.
David: Thank you for having us. We’re excited to be here.
Morgan: Hey, guys.
Mindy Jensen: So I’m looking for a snapshot of your money story. Morgan, I’m gonna go with you first. Where does your journey with money begin?
Morgan: So my journey with money began when I was a young child. Um, I grew up in a divorced household, um, and both my parents raised me on and off their time. Um, but the cool thing is, is they got us a savings account when we were really young, early 90s. So every week I would take my passbook to the bank, um, and I would get in real time how much money was in my account. But that was really it. My parents would deposit money for things like household chores, and then when I became old enough to start working at 14, I would then deposit my own money. Um, but that was really how my childhood looked. Um, my parents never, ever talked about what a 401K was, um, what an IRA was, anything to do with their jobs. Um, so they really just said, save your money for a rainy day, um, and spend your money on things, which is weird to me. So every year my mom would take her income tax and bring us on vacation. So I grew up with doing certain things like going on trips, um, instead of buying tangible items, if that makes sense to you.
Mindy Jensen: Yeah, experiences over possessions.
Morgan: Yeah, over possessions.
Mindy Jensen: David, how about you? What did your upbringing look like?
David: Yeah, similar. So I grew up, uh, actually, I guess to kind of even back it up, I was adopted when I was three months old from Calcutta, India. And grew up in Rhode Island. Um, both my, we grew up in a middle-class family. My dad was a computer programmer and my mother was a social worker. And money was never a big topic for us. Um, you know, we knew to save money. We knew to, um, invest your money with uh CDs at banks. And real estate and 401ks were never a discussion in our household.
Scott Trench: David and Morgan, could you tell us what you do for work?
Morgan: So I was actually a special education teacher for years, um, until we had our son in 2017. And that’s when we discussed, am I going to continue working or am I going to stay home? Um, so with the cost of childcare, it was just a no-brainer for me to leave my career to raise our son. And we knew in the future that we wanted to have more kids. So I became a stay-at-home parent.
David: So for me, uh I’m a New York State Police investigator. Um, I work with the counter-terrorism unit and we work with the FBI. So to kind of give you an overview of what we what I do, um my role is to essentially make sure another 9/11 never happens in New York State again. Um, we make sure that, you know, there’s no domestic terrorism in New York, and that’s the focus of um what I do for work.
Scott Trench: Awesome. Thank you very much for doing that and keeping us all safe here. Um, it’s wonderful. And, um, remind me, do you what part of the, in a general sense, of the state do you guys live in in New York?
David: So we’re up um toward the Adirondacks, right near uh Lake George and Saratoga Springs.
Scott Trench: Awesome. And this is notable, I believe because I attended, um, obviously I was at BPCon 2023, and I had this thesis in my mind that upstate New York is like the best place to invest because of the changes from COVID, everyone’s moving out um to the to these areas. It’s beautiful in the summer, you got all these all these fancy things. The cash flow is great. And I and I’m talking about this thesis, and David comes in and we’re at the bar and he goes, you are you’re crazy. I live there and I would never invest here and I invest out of state. So, so with that prompting, can you, can you tell us and let’s, let’s, let’s tease that up for later. I’d love to hear about the thesis here. But how did you get into real estate investing? How did that start to get set up?
Mindy Jensen: Give me a little bit of background about your wealth-building journey leading up to, maybe, to 2017 and, and kind of the changes that came about when you guys had your son.
David: So we moved back to New York, um, from Arizona when I was in the Air Force. And so I joined State Police in 2014. Um I was a trooper on the road and I was promoted to the position as the investigator in 2019. So with state police, um we have a pension, we have a 401k, and those are kind of the foundation that we had um going into real estate.
Scott Trench: Awesome. And, and you guys are imagine, I imagine also accumulating wealth at a pretty good clip in the years from 2014 to 2019 that you just previewed here. Could you give us an like, um, you know, your, your mindset on how you spend, budget, and otherwise think about accumulating wealth?
David: Absolutely. So I think uh, I think we’re very much similar to everyone else. In terms of, we, when we moved back, we built a custom home, we both have vehicles, we’re doing everything everyone else is doing. We’re not doing, we’re doing everything everyone that’s middle class is doing. We’re not, we’re saving money, but not to the degree that we are now. And I think going along that path and then once COVID um happened and then Morgan’s at home with our children, that was the catalyst that um started us on the real estate journey.
Scott Trench: Okay, so to be fair to say that leading up to 2020, you guys are living a very normal kind of middle-class lifestyle from a financial perspective, um here, in a relatively lower cost of living area. It’s not the lowest, but it’s not Manhattan either. Um, and this, and and you’re accumulating a little bit of cash over years, um, in addition to 401k contributions and a uh, uh, I don’t know what the word is, vesting maybe pension plan, moving towards vesting the pension plan.
David: Yep, we put in uh X amount every month uh towards the pension. And I think my mindset changed um when I was a trooper up in the Adirondacks. Um I met a mentor when I was stationed up there and Greg really gave me the foundation and kind of the thought process of a real estate investor and you know, you’re never going to change your life unless you try. And that mentality that he um gave us and that, you know, that idea has really led us to where we are now.
Morgan: And a little background on Greg really quick. He is a guy from LA and he vacations um in the Adirondacks every year and Dave just happened to meet him when he was a trooper on the road. Um so Greg is a real estate investor. So every time he would see Dave, he would say, you know, what are you and Morgan doing and have you ever thought of this? And he started to talk to Dave about all of his investments. Then Dave would come home and report to me, uh, everything that Greg was doing. So that’s what got the ball rolling on what made us really start to think about, okay, I think this is possible. I think we have the income to do it. We’re looking at all the 401k information and money that he’s put in to his deferred comp. Um, and we had our son and I’m and I said, let’s just do it.
Scott Trench: What year is this that this transition and and and thought process happens?
Morgan: This was, um, you were still up in Tupper. This was in 2019, between 2018 and 2019 because we had just had our second child, our daughter. Yep. And then, I think you and Greg talked over the, it must have been a few years.
David: Oh absolutely, and we still stay in touch.
Morgan: That he talked about it and then it wasn’t until 2019 when we purchased our first property.
Scott Trench: Stay tuned for more on how David closed on his first investment property after this quick break.
Scott Trench: Welcome back to the BiggerPockets Money podcast. Let’s jump in.
Scott Trench: You saw in 2019, you’re having this bug to buy real estate, um, and you purchase that, or it’s building up, and in 2019 is actually when you buy the first property. Mechanically, where did the, the resources to purchase this property come from? Did you have a cash position? Did you have to find another creative way to access this? And how did how did you get prepared financially to buy that?
David: So that first purchase was in October 2020. That was in Cape Coral, uh Florida. So in terms of the money and where we pulled that from, it was from our 401k. So to kind of give you a snapshot of that, we pulled, um, we pulled a percentage of money from our 401k, there was 30,000, and we used that 30,000 towards the purchase. But then this is also during, since this was during COVID, we also used the CARES Act. And since our my son wasn’t able to go to preschool at the time under the CARES Act, you were able to pull out further funds. So he pulled out an additional 25,000. So now we’re working with 55,000 towards the down payment of that um first property. An from there also using our savings, we were able to close on that first home.
Scott Trench: Awesome. Okay, so we have a combination of savings and 401k. Did we borrow from the 401k or was this a straight up withdrawal for the first part? The second part sounds like it was a withdrawal.
David: Both, yes. So the first, the first part was a, uh, was a loan and then the second part, the Cares Act was, uh, just pulling out those funds.
Scott Trench: Awesome. Okay. Now, why, why did you decide not to invest in the great upstate New York, uh, land that I have built up in my head to be this wonderful land of magical investing returns and instead decide to go to Florida with the hurricanes?
David: That is a good, loaded question. So, Florida, there’s a couple of things. Um so this is during the middle of COVID. Um just demographically, if you look at migration patterns, everyone from California and New York are moving. So there’s a couple of reasons for that. One, Florida, obviously great weather, and then two, taxes. And everyone was still working. Florida didn’t shut down. Yep. Landlord tenant laws in Florida are better. I mean, they have, uh, high insurance rates now, but we do things to mitigate those costs.
Mindy Jensen: Okay, I want to know what you do to mitigate those costs because Florida insurance, homeowner’s insurance is um, let’s be polite and say unaffordable.
David: Yes, I agree with you. So when we, when we went to go purchase our first property in Florida, um, I was actually originally looking at condos. And um, another trooper, he bought a condo down there and he said, you know, I’m making $200 a month and off of that condo is passive income. I thought that sounded excellent. And then I started listening to BiggerPockets. And BiggerPockets said you should go for that 1% rule.
Scott Trench: Those were the days, huh?
David: Yes. Oh, so it still works. So I, without, you know, having any other any other ideas of um real estate, I just said to the realtor, I said, I want to make 1% off of the total purchase price. She told me it wasn’t possible and you can’t do it in this market. And so I told her anything’s possible and we found another realtor. And after we found the other realtor, she introduced us to a program. The program is a sobriety program. It places individuals going through alcohol or narcotics recovery in single-family homes. Um, and that organization is how we’re able to one, bring in that 1% rule, and then also, it allows us to make a substantial amount and to hit that 1% every, every single, um, purchase. So with the high insurance rates, we’re able to far exceed what apartment complexes, Airbnbs, a whole slew of other real estate investments, what they’re able to bring in.
Mindy Jensen: So with this sobriety program, who is paying the rent on the property?
David: That’s a good question. So the tenants are paying um rent to us. Now, to give you an example, they have, we’ll say, we have an our home in Tampa. There might be 10 other sobriety homes affiliated with that program in Tampa. So we receive the rent from the the tenants, but if for whatever reason they can’t pay, if there’s a hurricane that comes through, those other 10 homes will chip in rent and then they will give us um our monthly rent check. Now for whatever reason, those 10 homes can’t um pay us, it goes out to a chapter. Chapter covers a region in Florida and that regional chapter will kick in money to us. And if for whatever reason that can’t happen and there’s a large, large hurricane, the state of Florida will end up sending us a rent check, which actually happened a couple months ago. And then there’s another safety program as well on the federal level.
Scott Trench: Now, the, the mechanic, the economics of this at the fundamental level are, these are typically multi-bedroom homes and we’re really packing in a large number of individuals per property, right? And so people are actually splitting rooms in many cases or is that a different type of program that and that’s not the same as what you’re doing?
David: There might be a couple of rooms that are split in half, but for the most part, it’s six to eight people per house. But I mean, we’re looking at homes that are 2,500 square feet, five or six bedrooms, two to three baths. They’re large homes.
Morgan: And if for whatever reason, we need to, we we’ve actually added, um, multiple houses. We’ve we’ve added on. So we’ve added two, three more bedrooms in some of these properties before the tenants move in to give everybody an adequate amount of space.
Scott Trench: Awesome. And then mechanically, are you guys, um, finding um candidates, clients for the program, um, here? How does that work?
David: So we are very, very, very hands-off, um, with regards to the sobriety program. Um, we only take care of major um fixes within the homes, whether that’s an HVAC system, but otherwise, the program, they place um individuals into the home. They have a, more or less a house manager and they will contact us if there’s any um issues with the house or any repairs to be done. But we don’t find the people. They find the people. If there’s ever any major repairs, um, we’ll cover them, but there’s minor repairs, they will actually cover the cost of those minor repairs in the home.
Scott Trench: Now, do you ever get, one of the things, I I’ve, I’ve contemplated this for some properties here in Denver and have ultimately opted not to to do the same. Do, do you, how do you position these properties? I imagine that neighbors, for example, um, in certain neighborhoods would have a problem with 8 to 10 recovering drug addicts or alcoholics in a building nearby them. How do you, how do you find these properties and, and do you factor that at all into your consideration for these purchases?
David: Absolutely. So the thing about the people that are in these homes and this is one thing that was really big for me just because I was, at the time as a New York state trooper, and I’m making arrests of people that are that have narcotics on them that are drinking and driving. And once I was, the program was explained to me that these are just normal, normal, normal people. They are, in our Tampa home, we had a uh, local DJ that was in the home. We have people that are normal blue-collar workers. And they’re just as normal as anyone else. They’re not the normal people that I would deal with in terms of making arrests. And in terms of when we purchase these homes, we make sure that the home one is not overfilled. Um, it’s a normal, you know, five to eight people in the home. And they’re in nice areas. Um, we’ve rarely had any complaints from neighbors, but we also make sure the houses are kept up, that there’s landscaping that’s done, that the driveway is a big driveway to accommodate all the vehicles and that there’s not vehicles parked on the road.
Mindy Jensen: When we went to purchase our first property, I always told Morgan, I wanted it to be a property that we would live in.
David: Yeah, that we would live in and that I would be proud to live in. And that’s kind of been our mentality going forward.
Scott Trench: Okay, so can you give us the the numbers on this first purchase? We don’t need to go through every purchase in the portfolio, but I’d love to hear about this first purchase and what the portfolio has uh swelled to today.
David: So this first purchase in Cape Coral, it was uh, it was in October 2020. It was 269,000. And the cash we invested in that property was $58,000. Um, that house right now spends off um $1,316 a month of cash flow. And just in terms of uh quick numbers, that produces an ROI for us of uh 22.65%. We were able to get 1% off of that purchase price and then right now we’re renewing the lease and then we’re also going to get, um, you know, a higher passive income and a higher ROI from that.
Scott Trench: Awesome. And you’re probably, you’re providing affordable living conditions and helping people on their recovery journeys, um, with this as well. So that’s fantastic. How many of these do you have today?
David: So today we have 10 homes. Um, they’re spread throughout Florida and we strategically buy them in, you know, high retirement areas or areas that everyone would like to move to that will appreciate. So whether that’s Jacksonville or Cape Coral or Bradington, you name it. Um, those are areas that we pinpoint in terms of um very certain data points. Um, and so far it’s worked out pretty well.
Scott Trench: Awesome. And then let’s zoom in on the, um, uh, the most recent purchase. What’s the most recent property that you you acquired and what are the numbers look like on that from an acquisition standpoint here in 2024.
David: So the most recent purchase was in Orange Park, which is in Jacksonville. Um that purchase was 329,000. So to give you an idea of that, that current mortgage, we’re looking, so we’re faced up against right now an 8% interest rate. So, obviously, everyone else is going through the same boat that we are with high interest rates. Um, we for that rent, we were able to negotiate a $3,300, um, rent every month and that gives us a cash on cash of uh $977. So, um, for the ROI for that property, that is giving us a 24% ROI off of that property.
Scott Trench: A 24% cash on cash ROI?
David: Correct.
Scott Trench: Awesome. Okay. And and you used the word negotiated $3,300 in rent. This is a negotiation with a program that fills the house with sober living clients. Is that is that, am I using the right terminology or am I reasonably close with this?
David: Absolutely, perfect. Awesome.
Scott Trench: So what would the property rent for as a long-term rental?
David: A lot less. I don’t know them uh specifically, but a lot less. Um so the other thing is that I always prepare is that if this program did fall through, that I need to make sure that I can rent very close to what our current rental rate is in terms of to make money. So that’s why we purchase in these appreciating areas. Um, in terms of what they would make, it would definitely be a few hundred dollars less. Um, but every couple of years, they will give us uh they will increase rent, um, more and more just so they can have that stability.
Scott Trench: Is there another piece to your overall portfolio or how do you think about building wealth today and what’s the end game?
David: So that’s a good question. So, I think for us, um, you know, I know that there’s the FIRE movement and that I think there’s a lot of value for me as a state police member, obviously to keep my job but to have that aspect of a W2 and it allows me to have reserves, it allows me to plan for if there’s ever a air conditioning that goes. And for me, at least as a W2 worker, it works right now. Um, you know, I’ve six and a half years left with state police. After that, um, then I will go on to retirement and continue growing our portfolio.
Scott Trench: And can you walk me through the six and a half years thing? What is, what is the six and a half years item there?
David: Yeah, just six and a half years until I retire. Um, so with my military time, um, I’m able to buy back a couple of years and then after that, for me, it’ll be year 17 with, uh, state police I’m able to retire.
Scott Trench: And that, and retirement, and by that, you mean you’ll, you’ll have the pension, um, and benefits that that that kick in.
David: Yes, so I’ll have a pension, I’ll have a 401k, and then, uh, and then we’ll have our real estate.
Morgan: Yeah, because state police, it’s a 20-year commitment. For state police. Yeah.
David: So, I mean, I think our goal, obviously, my original goal was to have, when we started this, um, my original goal was to have 10 homes. And in 10 years, and I wanted to have a one home a year and then that didn’t happen. And then we just far exceeded that um expectation. And then I originally wanted to have $10,000 passively and we’ve exceeded that. So, my new goal, um, one thing I do is that I created a road map. The road map shows literally every single year since we started. Um, how many homes I want to or how many homes we should accumulate that year, how many homes we have, and how much we make uh passively every single month. So, it allows me to stay on track and as of right now, we’re hitting all the metrics and all the numbers that we need to in terms of our goals. So I want to have 50 homes when I separate from state police and passively make uh over 70,000 a month.
Scott Trench: That’s awesome. Um, and what will, what will you do with the 70,000 a month passively? Can you tell us about the the world travels or the excitement that will come uh at that point?
David: You know, I’d always joked around and just said, you know, I’d like to retire and um, just didn’t have any big plans. But to be honest, I want to continue working as long as I can. I enjoy everything that we do within real estate. Um, I’d like to be the Warren Buffett and just, uh, live till, you know, as long as I can and continue doing exactly what we’re doing. I enjoy every aspect of it. I enjoy the research. I enjoy finding the homes in certain areas. Um, I wouldn’t be against moving on to apartment complexes and other endeavors, but I think one reason we are successful with what we’re doing is because we’re doing one thing. We’re not flipping homes, we’re not doing Airbnbs, we’re doing one thing and we’re doing it well. Um and I honestly just want to continue um doing what we’re doing and obviously make our kids a big part of that and hopefully it’d be something that they’d be interested in, um moving forward.
Mindy Jensen: We have to take this one final break, but more from David and his financial journey right after this.
Mindy Jensen: All right, welcome back to the show.
Mindy Jensen: So you mentioned that these sober living program is renting or signing leases two and three years at a time. Is there any, how long has this program been going on? Is there any, like I would love for them to go out of business because nobody needs it anymore, but I live in reality. But I’m wondering because you get so much more rent from renting through this program versus just renting to one family, have you taken anything into account that this program might end?
David: No. So this program’s been around since the 1970s. Um they were actually founded, um, by a stockbroker in New York City. Um, unfortunately, that stockbroker, he he needed this program. He was in an alcoholic anonymous program and there was no follow-up after, after that program was done and that’s why it was created. Now, kind of on that point, there’s hundreds of uh sober living programs throughout the um country, probably thousands. But one one of my bets was that unfortunately, like you said, you know, I would love if this program went out of business and it was never needed in the country. Um, but I think in terms of reality, it’s not going to happen. I think, um, for what I anticipate happening, it’s always going to be needed and it’s always going to be, um, something that’s that’s helpful for everyone. And that’s kind of something that we’re banking on.
Mindy Jensen: Yeah, and I wish I could say that you’re going to you’re wrong, but you’re not. It’s going to be needed. Um, do they have, they been around since the 70s in Florida, like in this location? I’m just, I’m trying to poke holes in this. There’s not any, you’re not leaving me any room to poke any holes in your plan.
David: No. So they’re in uh, they’re in every state in the country. Um, they were allowed in Florida, Florida legislature allowed them in a couple years ago, um, beginning of 2020. They allowed them to start, um, purchasing properties in Florida. And obviously they use an investor to purchase those properties. Um, but no, they’re in Canada, they’re in the United States, they’re actually even in Australia. Um, but they have such a high success rate and 85% success rate. And that’s why there’s a lot of value and states recognize them as well as other sober living programs because of the way they are structured, in terms of having a president of the house, a treasurer, a secretary. It gives everyone a job and it gives the house a meaning. Um so they’re able to be successful because of those jobs.
Morgan: There is a little story if you guys want to hear it with the law enforcement, um, that called us.
David: Yes.
Morgan: I don’t know if you guys want to hear a quick story.
Scott Trench: Yeah, let’s do it.
Morgan: Okay.
David: Okay. So, uh, in our property in Fort Walton Beach, um, it’s up towards Pensacola, Panama City. Um, I got a phone call while I was at work that one of our tenants was, uh, going around the neighborhood and checking, I say checking, but or uh trying people’s car door handles. And I don’t think it was as a nice thing. Anyway, so he got a call from the police department and told them what I did, which was very well received by their police department down there. Um so that individual was removed obviously from that house and that sober living program took care of that um that person being removed, nothing that I had to do. Um, since what I do and that program was so well received by the police department, they ended up going over to our house two weeks later and throwing them a barbecue.
Morgan: The whole, the whole Fort Walton Police Department.
David: Yep. And they also did, so they took these guys that are, you know, in their 30s, 40s on police ride-alongs. And um, it was a very, very good, it was a good story just for them to understand what we’re doing, that everyone, a lot of people have pre-conceived notions of what it is and they were able to see that that is not, they’re all just normal, normal people working nine to five jobs.
Morgan: And this was a little bit of a more um affluent neighborhood where we purchased this property. So a lot of the neighbors were like thrilled. And I know we mentioned that earlier. Um so they were constantly calling the local law enforcement. And of course, this situation was warranted. Um, but the Fort Walton Police sided with our house, which was really awesome. And we never heard anything again. So I thought that was great for the community to know that these houses exist and for the world to know that these houses exist and um these people are just trying to live normal lives and in a safe, clean home. So I just thought that was really cool that they all came together and…
David: Yeah, they said that that was the first time that they’ve ever, ever had law enforcement come over and cook for our guys. Yeah. That was a first.
Scott Trench: That’s fantastic, guys. Um what a wonderful, like, tie-in to what you do and and the and the research and a very thoughtful business that you’ve constructed here, um, over several years. I have a couple of quick last-minute questions here before we wrap up. One is, um, is all of this real estate owned personally by you guys or in a business that you 100% own or do you have outside investors or partners in any part of the the business?
David: So all the homes are owned by me. They’re all deeded to us. Um however, a couple years ago, I’ve always had interest from co-workers to to get into real estate with us. Um, I’ve never been comfortable doing it until Morgan said, you know, what’s the worst that could happen? And I said, well, I could lose everyone’s money. And then, um, so when, you know, Morgan was, she’s awesome with this. So she is a very, very, very supportive person. And she gave me the confidence to move forward with, uh, using investor or using funds from my co-workers. Um so that looks like we received $50,000 from a co-worker and then I will produce returns from them. So I essentially make nothing off of, we’ll say…
Morgan: The last three properties.
David: The last three properties.
Morgan: The first seven properties was just our money.
David: Yep. And I will give them the passive, or the cash flow that I’m receiving off that property. Now, after year five, it’s a five-year um note that we do with them. But after year five, we will receive that um cash flow. And the benefit to them is that it takes place, um, with our 401k and I can give them better returns than our 401k can. Um or our deferred comp. Um so there’s a huge, huge value for them just because of what we do is very stable.
Scott Trench: Okay, so, and so co-worker lends you $50,000 or whatever it is for the down payment on a property. You use those funds as the equity in the down payment, and then borrow, um using a conventional loan in your name for the remaining of the property. Pay them back principal and interest over five years and then own the property outright. And you’ve done that in the last three, including perhaps the deal we just discussed, the most recent one at 8% interest mortgage.
David: I mean, it’s a huge benefit to them. Everyone’s happy and then in five years, then we’ll have that property, um, moving forward. We’ll have that cash flow moving forward.
Scott Trench: Got it. Okay. Um awesome guys. And then last question here, are you still contributing to your 401ks? because, you know, or anything? Are you plowing every dollar available back into real estate?
David: I was initially, but I don’t put it into my 401k anymore. Um, I’m not against it. Um the 401, 401k is great, but what I can produce off of our real estate far exceeds anything that the 401k um can push out. And, yeah, we don’t put anything into our 401k anymore.
Scott Trench: Awesome. So this is the bulk of your portfolio now is this plus a vesting pension plan.
Mindy Jensen: Okay, I have a last question. How much time per week or per month are you spending running the properties you already have, not looking for new ones, but just like managing the 10 houses you have?
David: That’s a good question. So, not much. Um, just because of the way they’re structured and they have that house manager, we don’t get that many emails or phone calls whatsoever. Um I’ll get a couple a week, if that, and that’s it. Um I use my commute going down to work in terms of being on the phone or listening to podcasts or whatever. And in terms of managing them, there’s not much managing in terms of my side. It’s just um major fixes or major repairs that might need to be done.
Morgan: Which we’ve had quite a few in the last couple of years. We’ve had some big fixes. Um but I think it’s interesting where we find our people to do that. We’ve pretty much established a team in Florida, and not people that work for us, but we used an app, um that most people I think are familiar with, if I can say it. Um we used, Dave loves Yelp, um, and we have found HVAC technicians, we have found plumbers, landscapers, and these are people that we’ve now over the course of four years have established a relationship with. Um, our landscaper has driven hundreds of miles for us to put in, um, uh, sprinkler systems and our plumbing guys have worked on multiple properties. We’ve had to do HVAC in some of our properties and we’ve used the same people, um, because obviously we’re not there. So it’s hard to trust, if that’s the right word, um, that people are doing the job and doing it correctly. So everything that we’ve researched has been free, um, information and Dave’s looks at reviews.
Mindy Jensen: I think on that point, everyone is extremely honest. Um whether they like a company or not on Yelp or Google. And so we rely very heavily on for repairs on Yelp and Google and we have not had one bad experience with, um, a company. Um, just because if someone likes them, they’ll say they like them and it’s easy as that.
Mindy Jensen: That knocking on wood right now, knock on wood.
David: Yes.
Morgan: I know. But that’s awesome. That’s a great tip and I haven’t heard that one before to go to Yelp and Google reviews. Um, but yeah, I mean, you’re absolutely right. If somebody doesn’t like you, somebody doesn’t like the service you’ve provided, they don’t hold back.
David: That’s it.
Scott Trench: Well guys, where where can people find out more about you?
David: So we just uh created a website. So website is uh Stanhope-Capital and um that will have all of our social media handles, our email and uh everything else about us.
Scott Trench: Stanhope-capital.com. We’ll link to that in the show notes here. Well, thank you for all you guys do, for sharing this wonderful story and for teaching me um a lesson about upstate New York, um, and, and uh, how it’s maybe a nice place to live, not so nice a nice place to invest, um, from your standpoint here. So, really enjoyed the the conversation today and I hope it inspires a lot of people. Thank you guys.
David: Thank you very much.
Morgan: Thanks, guys. Nice to see you again, Scott. Thanks, Mindy.
David: Thank you.
Mindy Jensen: Thank you, guys. And for everybody who does invest in upstate New York, you can email Scott at biggerpockets.com to tell him how great the market is. All right, that wraps up this episode of the BiggerPockets Money Podcast. He is the Scott Trench and I am Mindy Jensen saying, toodles noodles.
Mindy Jensen: BiggerPockets Money was created by Mindy Jensen and Scott Trench. This episode was produced by Eric Canuteson. Copywriting by Calico Content. Post-production by Exodus Media and Chris Mekens. Thanks for listening.
