Scott Trench: Mindy and I are so grateful for the following sponsors who make BiggerPockets Money possible. Today, we’re going to hear from a real estate investor who started on a teacher’s salary, bought rentals in one of the most volatile real estate markets in the country, and entered the Great Recession with maximum leverage in a very vulnerable financial position. Hello, hello, hello, and welcome to the BiggerPockets Money Podcast. My name is Scott Trench, and it’ll be just me this week while Mindy is traveling in Amsterdam. How’s that for a Dutch intro? All right, Corby Goade is gonna tell us what it was like navigating this extremely difficult stretch of financial markets back through 2007 and through about 2011, 2012-ish, and how he scrimped, saved, and swung a hammer for nearly 10 years before building the next round of his business. And then we’re gonna talk about how that trial ultimately resulted in an unbelievable amount of business success, real estate wealth, and lifestyle optionality, and how he lives a pretty wonderful life with a lot of fantastic options today. Corby, thank you so much for joining us here today on the BiggerPockets Money Podcast.
Corby Goade: It’s an honor. I appreciate you guys having me on. And I’m excited to chat with you, Scott. Thanks for having me.
Scott Trench: Awesome. Well, let’s kick things off. Let’s hear about how you started investing as a teacher. What was your first deal?
Corby Goade: Actually, I did my first deal before I even had a teaching job. I was in college, and I came from a pretty modest family where we didn’t have extra money or extra cash. So I was going to school and paying my own tuition. And part of the deal was, in order to do that, I had to have a full-time job. So I was working full-time and taking as many classes as I could. I’ll get into detail wherever you want, but the short version of the story is my girlfriend at the time, who’s my wife now, she inherited a little bit of money from her grandparents. It was not a ton, but a little bit. It was enough for a down payment on a house. And the stipulation was it was supposed to be a down payment on a house. So she had her parents co-sign on a house for her, got roommates, and kind of did a house hack. And I decided that she couldn’t have a house and me be living with a bunch of my buddies in a teeny little apartment. So I just called a lender and asked if there was any chance I could get approved for a loan. I had no idea what a mortgage looked like or what an FHA deal was, and he kind of walked me through some of that. And I ended up buying a live-in BRRRR as my first kind of house hack before there was such a thing as house hacking, using an FHA loan. And a couple of my roommates from my old place followed me over, and that’s kind of the very first deal that I did, and I didn’t really have any plans or expectations around that.
Scott Trench: What year did you start with this first deal, and how much were you making? Approximately.
Corby Goade: Oh, you’re calling me out on my age. I can tell what’s going on here. I was 21, I think 21 or 22. This would’ve been in 2001. I think it’s either 2000 or 2001. I remember buying the place in December because it was really, really cold and I couldn’t really afford to keep the heat up. So we had lots of blankets going on. The specific numbers at that time — this house I bought for $105,000. I put 3.5% down on an FHA loan. It was a cosmetic fixer. Actually, I still have that property today.
Scott Trench: Oh, awesome. So it was more of like a BRRRR, like you said, and a long-term rental than it was a live-and-flip.
Corby Goade: Yeah. Yeah. I mean, my intention — oh, you asked me how much I was making when I did that. I remember very clearly, I was salaried, working at the time for a nonprofit organization. I worked for the YMCA in the youth sports department here in Boise, where I live. And my salary was $17,500 a year. I was working 60 hours a week, and I was taking between 8 and 12 credits in college at the time. So I was pretty busy. But yeah, $17,500 was my salary at the time.
Scott Trench: All right. So we’ve got — you were 21, and we’ve got our first deal underway. Tell us about the numbers. Was this allowing you to live mostly for free, or how did this impact your finances?
Corby Goade: I ended up basically paying about the same rent as I was before. I wasn’t living for free. I think at the time I was paying about $300 a month in rent in an apartment with a bunch of my buddies. And in this single-family home, I had a couple of my buddies move in, and after they paid me rent, I think I was charging them $250, something like that. My payment was a couple hundred bucks. So my out-of-pocket expenses were about the same, a little bit less, but I owned my own house and we could do whatever we wanted with it. And it needed a little bit of love. I understood the idea of being able to build equity. I didn’t really understand how it worked, but I think I lived there for a couple years. And over the course of a couple years, on the weekends, me and my buddies would run to Home Depot and I’d pony up $50 for paint and we’d paint a couple rooms. And the next weekend I’d spend $100 on tile and we’d figure out how to lay tile and we’d tile a bathroom. So we just kind of slowly worked through the house, and I actually had a really fun time just doing that with my buddies.
Scott Trench: This is very similar to what I did in 2014 when I bought my first house hack. One of the things that I always struggle with is buying in 2014, I could have really made a bunch of bad decisions and still made a ton of money because the Denver market appreciated so much over the next 6, 7 years through to 2021. I think that’s probably a similar story for you to a certain degree, given you bought in 2001, and markets appreciated dramatically into 2007, 2008. But you’ve held this thing for 20 years now, through various market cycles, through the Great Recession. What was it like holding this property, seeing all this equity built, and probably giving back a lot of that for a few years there in the recession?
Corby Goade: Yeah, you know, I think about that a lot because in the business that I run now, we deal with a lot of people that are trying to invest for their first time. So I think about the ratios and the difference in the market now versus what it was like 20 or 25 years ago. I fully acknowledge that people are starting today — it’s a lot more difficult. There’s especially markets like Denver and Boise, where I am, there’s more competition than there used to be. But I think the biggest challenge really is that it’s a lot harder to get loans, and the products are a lot different than they were back then. So those are a couple of the biggest challenges. In all honesty, I think the ratios are pretty similar as far as income to purchase price and values of properties now. It’s not that far off. So for instance, I was making about $20,000, give or take, back then. It was a little bit less than that. And the house was $100,000. So it was about 5 times what my income was. And now, if a couple is making $100,000, the average home in the city I live in is about $500,000. And I think it’s not unreasonable to think fresh out of college that at least a couple would be making $100,000, and those ratios would be very similar.
Scott Trench: I think you’re onto something here that’s uncomfortable and probably unpopular to state, but we’re going to state it anyway, which is, you know, 5 years ago, the narrative that incomes were not keeping pace with home price explosions was completely true. But for the last 5 years, real, inflation-adjusted incomes have been going up while housing prices have been lagging behind inflation over that same period of time. Now, it’s still more expensive than it was 5 years ago, 6 years ago to buy a house if you’re going to get a mortgage, because of interest rates, right? And for the foreseeable future, that may compress price growth until we see interest rates decline. But yeah, I think we are sneakily, over the past 5 years, catching up — maybe not to historical averages, but to a much more normalized price-to-income threshold for housing in many parts of the country, not all of them. So I think that is catching up to people. And it’s not gonna be a popular topic, because it gets a lot more engagement to talk about how unaffordable housing is and how price-to-income ratios are out of whack. But I think that gap has been slowly closing, because income growth has been sneaking up, and housing prices have not gone far.
Corby Goade: I would agree with that. And it’s realistic also to say, you know, at least in my market, the median single-family home is a little bit over $500,000. And I’d be remiss not to say I fully acknowledge half a million bucks for a starter home is still a ton of money, but those ratios still play out. It’s still attainable for quite a few people. So I agree with you. It may not be the most fun thing to say, and a lot of people don’t love hearing that, and I’m not really putting a value on it, but it’s the facts.
Scott Trench: One other point though, going back to my other question is, again, I just take myself at 23, 24 when I bought that first property in 2014. And I say, if I just transplant myself and I happened to have been 23 or 24 and starting my career in 2022, 2021, I would have bought at the relative peak, that first house hack. And that could have completely changed the trajectory of my life. There’s a luck, complete luck element to being that age and having that drive to house hack at that point, which paid off for both of us. But I’m wondering if you ever think about that counterfactual, if you just happened to have started this process in 2006, how different the outcome would have been.
Corby Goade: I acknowledge that there is some luck, definitely, because I was completely ignorant to how things worked, or the fact that I would still have this house 20 or 25 years later and what that might look like. I had no clue. I think the reality of it is you have to take action no matter what. We can’t control where the market goes. Generally speaking, we can’t control what demand looks like. I can’t control what interest rates look like, but I can control putting myself in a position where I can take action and do something to influence my future. To me, that’s the biggest thing. I’ve bought lots of properties over the years, and some have done much better than others. And generally it didn’t have a whole lot to do with me or the timing beyond what the market did at that time. And I can’t control that, and I can’t predict it.
Scott Trench: I completely agree. You have to take action. A house hack is, for many people, pushing all the chips on the table early in life into this thing. And there’s an element of luck to it, and an element of it’s a really good bet. And it’s not going to work out all the time, but across a 10-year cycle, there’s a very good chance that you’re going to hit winners over and over and over again on this, with one loser out of ten across that process. You have to make peace with that at some point on this journey. Now, next question. A lot of people, I think, when they get their first house hack, keep putting the chips all in and buying more and more and more and leveraging, and all that. And then that eventually catches up with you whenever the cycle changes. You’ve clearly survived this 2007, 2010 crash in the real estate markets, which I’m sure impacted Boise pretty heavily here. Can you tell us about your journey from this first house hack and how it set you up, and then how you somehow managed to not get in over your skis in real estate at that point?
Corby Goade: That’s a really good question, because I remember being that person. And to fast forward a little bit, we had done a few more deals before the crash happened. My wife and I had done a few more, and they were basically BRRRRs, and we had those places rented out. And we had locked in, obviously, our monthly payments with traditional 30-year mortgages. And when the market crashed, values came down here 40, 45%. So we were underwater on every property that we owned. And especially being fresh out of college, we had a lot of friends who were doing short sales and letting their houses go, strictly because they were underwater — not because they couldn’t afford their loans, just because they thought they were upside down and they didn’t want to have this weight hanging over them. I had family members and friends that were all telling us, “You guys are crazy. You need to just cut and run and dump these properties.” My wife and I talked about it. I mean, we never really considered doing that, because I’m a firm believer — like, I signed a contract saying I was going to do something, and I’m going to fulfill my end of the bargain. So from an ethical standpoint, walking away just because I changed my mind didn’t feel okay to me. But beyond that, we had tenants in these properties that were making payments, and it was covering all of our bills, and there was plenty of demand for rental properties in our market. And so even though rents had come down a little bit, across the board, it didn’t come down as much as values came down. And so we never really had any trouble filling them with tenants and keeping the bills paid. So we just kind of kept our heads down and waited. And I had no experience to justify it, but I just always felt during that time that values have to come back. Like, over the course of time, obviously the stock market’s going to come back, and lenders are going to start lending on houses again, and there’s still demand in my market, and our population was growing. And if we waited it out, things would be fine. And whether that’s completely dumb luck or whatever you want to call it, it paid off for us to just keep our heads down. We didn’t buy any new properties during the recession. It’s funny, you hear a lot of people, especially younger people, saying, “I can’t wait for the market to crash so I can get a house.” Well, if the market crashes like it did in 2008, you’re not getting a loan anyway. If you don’t have cash, you’re not buying a property. And so we didn’t buy any properties during the recession, because we didn’t have any cash and we had very modest income. But we kept our heads down and just waited for our equity to return. And it did.
Scott Trench: So let’s go back to this concept of luck, right? So you bought in this market, and you basically went all in, you kept going all in, right? Buying the next one, refinancing to the maximum. And then that caught up with you in 2007, and 2008, and 2009. But because you cash flowed, presumably self-managing these properties, and just lived a frugal life, over time you were able to recoup the huge appreciation — the luck, if you will — of Boise’s growth in the last decade or so, the last 15 years in particular.
Speaker 1: Yep.
Corby Goade: Absolutely. I can’t argue with that.
Scott Trench: What was life like in these early days building that portfolio, and what was it like during the recession?
Corby Goade: My wife and I did everything with our properties, and for the record, we did everything wrong on the first few deals that we did. We were self-managing. We had no idea how to do that, and we learned a lot of lessons the hard way. We did most of the renovations ourselves. Anything that we possibly could do, we did on our own. And it was lean, honestly. We, like I said, we were fresh out of college. We had a couple properties, and I remember looking back — we had friends that were getting married, starting to have kids, and we’d get calls all the time like, “Hey, we’re having a barbecue this weekend. You guys should come over and we’re going to hang out in the backyard in the afternoon and drink beers all day long and have fun.” And my wife and I, we said no forever, because — “No, I’m sorry, we’re putting a roof on,” or “we’re going to be painting a house this weekend.” And our friends were always telling us how boring we were. And eventually they stopped calling. But the funny thing is, after things came back and we started getting more equity, and our lifestyle was changing a little bit, I’ve had a lot of my old friends call back and be like, “Man, how did you do all this? Where did this all come from? When did you start doing this?” And I just tell ’em, like, “You know, remember the times when you guys were all hanging out on the weekends drinking beers, and my wife and I were out, we were working, we were putting in the hours.”
Scott Trench: How long did that period of hustle and heads-down last for you guys?
Corby Goade: It was a combination of us just wanting to live lean and the recession, us having these properties. It was probably 5 or 6 years where we were on a pretty strict budget — as far as, we each, we had envelopes for groceries, we had envelopes for date nights. And if that money was gone the second week of the month, it was gone. We didn’t do anything, we didn’t buy more groceries. We were doing the Dave Ramsey thing, you know, beans and rice. If the money was gone, it was gone. We weren’t using credit cards. We weren’t going into debt. So we lived really lean for a good 5 or 6 years, just making sure that we were keeping our heads above water, keeping our fingers crossed, and waiting for the market to come back.
Scott Trench: And what year did you kind of begin popping up and being like, okay, I can actually — cash is now starting to flow back into my life in a more meaningful way, and I’ve got money to begin accelerating here. When did the tides begin to turn?
Corby Goade: It was around 2012, 2013. So in our market, things started picking up again towards the end of 2011 and 2012, and there was kind of a slow roll, but we went from being upside down in all of our properties to the valuation was kind of what we owed, and then it just kind of kept growing. And I want to say around 2014, we were able to refinance a couple of properties that we had before, and pull that equity and then go out and buy more properties. And we did more BRRRRs, we started doing more BRRRRs using the equity. Again, just to go back to the whole point of this conversation, we didn’t have huge incomes, and so we really had to use the equity that we had in these properties that we’d been sitting on forever. And if it weren’t for that, we couldn’t have done anything anyway.
Scott Trench: And so what happens next from 2014 on? Like, how does the portfolio scale and how does your lifestyle evolve?
Corby Goade: It was kind of a combination of a lot of things. So when we did that refinance, aside from our personal home, which we had, we had built a lot of equity in our personal home at the time too. So we had a HELOC on our personal home, and then we had 3 rental properties when the market came back around 2014. So we did a refinance on those ones with equity, and we had enough for a down payment on 2 more properties. And so we went out and bought 2 duplexes at the same time, just using that refinance, like I said, for a down payment. So we were getting conventional loans on these new ones that we bought. So we bought 2 duplexes at the same time when we refinanced these properties. From that point on, Boise had a pretty steady and reliable appreciation growth, probably not terribly far off from Denver. It wasn’t the craziness of COVID, but between 2014 and 2020, we were generally appreciating in the range of like 6 to 8% a year. That might not seem like a ton if you’ve got a $200,000 property, but we had 5 properties that were appreciating at 6 to 8% a year. And so when you add all that up, it grows and grows. And then at the same time, our rents were appreciating by 5 to 10% per year. And so the cash flow started getting better and better. We were able to kind of breathe a little bit at that time. My wife and I were both still working full-time jobs, not making a ton of money, but things started loosening up and getting better, and we started seeing more opportunity in real estate for our future.
Scott Trench: What were you guys doing during this time period for work?
Corby Goade: So my wife was still teaching, so she has a teaching degree and she’d been teaching at the time for, oh, I don’t know, 13 years, something like that. I had worked for nonprofits for a while, and actually I took a job for a little bit as an outside sales rep for a company that one of my friends worked at. And so I was traveling all over the place, and we had our first kid in 2012. I’ll try to be brief about it, like there’s kind of a confluence of things that happened all at the same time that changed things for us. So I was traveling all the time, 2 or 3 weeks a month. We had a newborn at home. He was born with a heart defect, and so he was in and out of the hospital, and it really was uncomfortable for me to not be around when he was in the hospital and seeing cardiologists. So I didn’t love that, but I can remember very specifically sitting in the airport at probably midnight in Kansas City. My flight had been delayed several times, and my wife sent me a video that day of our son taking his first steps, and I was gone. I didn’t get to experience that. And so this combination of things, I was like, I got to get a new job. The impetus for that was, because I was gone all the time, I couldn’t really be involved in the local real estate market, and I wanted to have my hands in it a little bit more. So I found a job working actually for the state, for the state health department here in Idaho. So I started doing that, and it wasn’t a ton of money, but the benefits were great, and it allowed me to be here to go look at possible deals and network a little bit better. So because of these heart issues that my son had, my wife took a leave of absence from work. And in the meantime, we had spent so much time managing properties that she kind of just put some feelers out with some friends of hers that had rental properties and said, hey, I’m looking for a little more income, I’m interested in possibly managing properties just on the side. We started this little property management company, and that started really getting steam and picking up. And that, in combination with our equity growth and the rent growth, it all kind of came together over the course of a 2 or 3-year period, where we just created an opportunity for us to go all in on real estate at that point.
Scott Trench: What 2 or 3 year period was that?
Corby Goade: That was between like 2015 and 2018, when things really started taking off for us.
Scott Trench: That corresponds with Boise really beginning to come into its own before the flood of Californians moved there when COVID hit, right? But still, you’re seeing a ton of appreciation, again, like you said, just like Denver, but it seems to all come together at that point. It only took you 11, 12, 13, 14 years of patience in your market to realize that boom. But man, it seems to have hit. And I imagine that’s when a lot of lifestyle factors or things began to get a little looser for you guys.
Corby Goade: Yeah, I mean, essentially what had happened was, between the few property management contracts my wife had taken on and the cash flow we were getting from our properties, we didn’t have a grand plan. I don’t have a spreadsheet that I plug in every deal into. I’m not a big planner. I’m kind of more like I jump in headfirst and then figure things out later. I came home from work one day and my wife just said, hey, I’m going to need to get a little bit of help with the property management thing. We need more handyman help. And I was going through all of our finances, and basically our cash flow was about what my paychecks were at my job anyway. And we started running numbers on what we were paying for contractors to go do kind of basic handyman stuff that I could do anyway on all the properties we were managing. She was like, I think you can quit your job. And I thought she was joking. We hadn’t even been talking about this. It was just one day after work, “I think you can quit your job.” And we spent probably 10 minutes talking about what it would look like, and I went in the next day and quit my job. And the rest is history, honestly.
Scott Trench: Tell me about this property management business that you built from there, and how meaningful that became for you guys.
Corby Goade: It’s actually been great. We had a handful of friends that had properties, and they referred us to other people who referred us to other people, and that started growing. So when I quit my job, we were managing, or she was doing it on her own, but it was about 35 or 40 properties. And that was a lot for her to do on her own. And so what I did was I took night classes to get a real estate license. And the idea was we’re going to talk to our clients about doing 1031 exchanges and maybe expanding their portfolios. And so I could kind of do some of that while I’m pitching it with the property management thing. But it almost immediately blew up for us, and I started doing deals with friends and family members and referrals that we were getting from property management. And she had to hire other people, I had to bring other people on to help me with real estate deals. And honestly, I shouldn’t say immediately, but, so you guys like to talk specific numbers, and without getting into the nitty-gritty, I quit my state job, my day job, in May. And between May and December— May 2015? No, sorry, this was 2018. 2018.
Speaker 1: Yeah.
Corby Goade: So the property management thing was building up over that period, and then in 2018 I quit my job. And so between May and December in 2018, in real estate commissions, I made as much as I would’ve made the entire year at my day job. And then the next year, commissions were 5 times what my day job would’ve been. And every year thereafter, it’s been 15 to 20 times what my income was before. And it’s something that I love. It’s super fun. And that’s fed our property management company, which has become its own beast. I’m actually in my office right now in our building, but we just bought a building last year just to house our staff, and there’s other suites, so we’re renting them out to other people. But the real estate thing took off, the property management thing took off. We manage almost 350 properties now in Boise. And those things altogether, it’s been a really interesting way that everything feeds each other, because now we have the ability to go out and do more deals like we want to do for ourselves. But in addition to that, because of the work that we do, we’re really integrated into the community here that’s investing, and wholesaling properties, and developing infill deals, and that sort of thing, just due to the nature of what we do.
Scott Trench: A lot of people right now are in a position where they bought a bunch of properties from 2015 to 2022, and they’ve got those properties and they’re not really going anywhere, right? This is something that’s going on with my portfolio, and we kind of hear it from a lot of people. They’re locked into these low interest rate debt loans here, they really can’t refinance them. It’s different than 2007-2008, because there is equity in a majority of these folks’ positions. But what can we learn from your experience going through 2007 to 2011? And the 10-year grind, I would say, from 2007, I’m hearing, to 2017, 2018, when it actually began to provide the propulsive tailwind to the big business and, what I imagine, the explosion in wealth and income that you enjoy today.
Corby Goade: You know, Brandon Turner used to always say this on BiggerPockets too, that real estate investing, it’s a marathon, not a sprint. And I think a lot of people come in having watched some reels or read a book and feel like they should be able to take extreme action and have extreme results really quickly. And I’m not saying that that’s impossible, but it’s not terribly likely that that’s going to happen. And I usually use an analogy with a lot of clients that I work with. So I’ll have people that will call me, and we’ll meet for coffee or come into our office, and they have no resources and no experience, and their expectations are that they’re going to quit their job within a month and they’re going to quadruple their salary because Grant Cardone said that they could do that. While that is possible for certain people with certain personalities, I think a more reasonable, balanced approach—and it is similar to what I did—and I’m not an incredibly intelligent person, I don’t have a lot of resources, I’m not the sharpest tool in the shed. The reason that I’ve been successful is partially because my timing was good and I have had some luck.
Scott Trench: Your timing was terrible. Your timing was absolutely awful, from what I can tell, right? Like, you bought in 2001, sure, and then there was a run-up, but you just told us that all your properties were underwater going into the recession, which means that you bought these 3 properties and then you refi— you financed them to the hilt. And you went into the recession in the most vulnerable possible position that you could have at that point in time. Is that the right way to read what happened to you?
Corby Goade: You know what? That’s a much more accurate view of it, I guess. I’ve always kind of looked at myself as being a little bit lucky, but if you look at it through that perspective, yeah, I did buy at a terrible time, and I guess I was just willing to put up with the pain and discomfort for longer than anybody else I knew was.
Scott Trench: Again, I’m inferring this, but I believe that you guys were in a position of pretty heavy scarcity for a good 10 years or so to get through that dynamic because of that bad timing. I think you bought in 2001 and ended up leading up to 2007. And because of that leverage, it wasn’t until 2012, 2013, where things began to loosen up. That’s a long time to float these deals, basically, to begin getting the payoff at that point.
Corby Goade: That’s true. But also, I could not have bought properties any other way. I didn’t have the means to do it any other way through that entire period. And so even when the market crashed and everything was cheap, no one was going to give me a loan, and I certainly didn’t have cash. And so going upside down and going through that in those properties would have been the only way that someone with my means and experience could have done it.
Scott Trench: Yes. And what I’m saying is, I don’t think that, like, I think a lot of people that were with your means and experience gave up and let the properties go.
Corby Goade: Yeah, that’s a good point.
Scott Trench: That’s the challenge people are grappling with right now. I don’t think this time is different—every time is different. But I don’t think that many people are underwater, maybe outside of like Florida, Austin, Texas, and a couple of those markets. But I think that’s the question, is like, do I just sell this thing? It’s a pain in the rear, it hasn’t gone anywhere in a few years, and that payoff comes so far down the road, it seems like, in terms of the compounding experience. And in your case, I think what it really did—I’m inferring here, and I would love to see if you agree or disagree—but I think what it really did is it built credibility for you with these lenders, the investors in the community, who saw what you were doing over 10 years and not going anywhere, not going anywhere, not going anywhere. And then that all of a sudden exploded into business and referrals that are very goodwill, coming into 2018 and 2019 when you made it your job. How’s that? Am I getting close?
Corby Goade: I can’t argue with that at all. I mean, and to be honest with you, in our business now, I use the story that I’m telling you pretty regularly, just so that people can see that I didn’t come from a lot, and I’ve done it all. I mean, I’ve cleaned toilets. The stuff that I’ve hauled out of houses is unbelievable, and none of that stuff bothers me. I mean, I’m willing to do whatever it takes to make a deal work. And so that’s part of it. But also, I have the experience and the history to see that if you’re holding property over a long period of time, it makes it really hard to lose. If you buy a property that there’s a little bit of equity in and it’s paying for itself or a little bit better, over time it’s probably just going to get sweeter and sweeter and sweeter, but you have to put up with the pain and discomfort in the meantime. A lot of people—that’s tough. They still want to have a nice car, and they still want to eat at a nice restaurant every weekend. And we went a long time without doing that. I’ve still—I’ve never bought a new car myself. I’ve never owned a new car in my life. I still don’t.
Scott Trench: I’m curious about your response to this, but the way my brain works is, I set a goal, I have a very clear end state that I want to work towards, and then I engineer the most efficient path to that end state. I don’t think that’s what you’re doing here with your portfolio. I think you bought these properties and then you pushed through, you got this job, you built a property management company—or at least you didn’t, up to the point in the story that we’re at. Is that accurate? And if not, what was your goal? What is your goal? What is the end state vision that you’re working towards here?
Corby Goade: No, I think that that’s completely accurate. When I bought that first house and turned it into a rental a couple years later, my mindset at the time was that I’m going to be a teacher for my entire life. I think the first lease I had on the house was $700 a month—that I rented it out for $700 a month, and my payment was like $625. And so in my mind, if by the time I retired, inflation and all that came together and that house would rent out for $1,000—which is what my mind thought at the time, was that 30 years from then, rent was gonna be $1,000, not $700—but that would be an extra $1,000 in my pocket every month. And I didn’t think beyond that. I just thought, like, maybe my retirement’s gonna be a couple thousand bucks a month from teaching, this’ll be another $1,000 in my pocket, and we can go on another weekend away a couple times a year. That was as far as my goals went at that time. And as we’ve done more and more of this, honestly, I don’t have an end goal. I love the process so much. And that’s why my wife and I are a really great match, because I tend to just jump into things that I have a feel for. If I think that there’s equity or there’s a deal, I’ll just jump into it. And then she comes behind me and she sweeps up the mess and figures out the numbers and makes sure that I’m behaving myself and that everything will line up the way that I hope it will in the end. And so we’re a pretty good team in that regard. We’re big believers in like Rocket Fuel, the idea that each one of our personalities kind of offsets each other’s weaknesses and strengths. And we’ve been fortunate enough to bring people on to work on our team that fulfill other needs that we have. I probably got way off from what you were asking, but I generally don’t have an end goal beyond the deal that I’m working on at that time. And when I get to the end of that, I figure out how to dispose of it. Coming into every deal, I just—when I’m done, is it going to cash flow and will there be equity? And I have basic criteria that I want to see for each one of those, and if I think it’s going to do it, then I’ll do the deal. And then when we get to the end, I’ll figure out if we’re going to keep it or sell it based on how the numbers panned out.
Scott Trench: This is fun because like, I feel like what we are so used to here at BiggerPockets Money is like, here’s my number, I’m going to hit it, and I’m going to do this. And there’s none of that here. It sounds more like a game of Monopoly where they just keep continuing to move on to the next piece. Can you tell us about what a day in the life looks like? Or how you are? Are you able to enjoy any of this wealth that you’ve created in this major income stream that you’ve built with these businesses? What does the life of Corby look like today?
Corby Goade: My life is amazing. Honestly, dude, I mean, when talking about luck, I really do feel like the luckiest person out there. One of the things my wife and I connected on originally when we first started our journey was that we both wanted to travel. When I was a kid, I had never been west of the Rockies. I didn’t get on a plane until I was 19 years old and I wanted to see the world and I had no idea what that looked like. And she traveled a little bit more than me, but not a lot. And that was something that we really connected on. We didn’t have a quantitative goal, but we both, that was what we wanted to do, find a way that we could travel as much as we could. And so now we have 3 little boys, they’re 13, 10, and 9 right now. But as a family, we travel about 4 months a year. We can do our work pretty much from anywhere in the world. And part of it is because we have really cool people that we work with that kind of do some boots on the ground stuff. But I can do my part from anywhere in the world. So we travel a lot, which is awesome. But beyond that, like, I’ll tell you what today looked like. This is a pretty standard day. I got up and went to the gym, came back and kind of helped get the kids ready for school, walked to school with the kids, came to the office and we just ordered a conference table that came last night, so I put the conference table together. We had our staff meeting at our new conference table at 10 o’clock. I went and had lunch with a general contractor who’s going to start building some ADUs for us and for our clients. And now I’m on a BiggerPockets podcast, so it’s all over the place. I have a couple clients that want to go look at properties later today, and part of the beauty of what I do working as a real estate agent with investors is I can go look at those properties anytime and I just do video walkthroughs and send them to ’em. So I’m not dependent on their schedule. They’re not dependent on my schedule. I’ll go do a video walkthrough. Send it over to them. And, who knows, maybe I’ll be writing an offer later tonight. But these days at home and when I’m working, every day is totally different. But we spend a lot of time traveling too. And honestly, all of it is fun for me. I love coming back from our vacations because day-to-day life is so interesting anyway.
Scott Trench: That’s a wonderful life that you’ve constructed for yourself. And I think that it’s a combination of luck and resilience really that have driven this. But I would say resilience more for those first 10 years. And if there’s been any luck, it’s probably been in the Boise market, being in the Boise market specifically from that 2015 point to the present, but you had to endure some real challenges to get to that point. One other framework I think that you’re going to blow up for me here is in terms of portfolio construction, I think that a rational approach, or at least the one that I would apply to my finances, is this concept of a very aggressive accumulation portfolio until you get to your number, and then a more conservative breakdown at that point, something, you know, paying off the rentals, for example, or using much less leverage. But if you go on to then build a huge business that produces way more income than you can spend any given year, you way overshoot the need for that conservative portfolio. And you can get aggressive again and keep leveraging up everything. And why not maximize ROI and think about it as a mathematical expression? Did that pattern manifest at all in your portfolio? Or have you just been consistently aggressive with the portfolio returns and optimizing for ROI the entire way through?
Corby Goade: We’re probably just as aggressive as we were before as far as leverage. It’s just that we have a bigger cushion on the back end, which is nice. It’s not as stressful as it used to be. And so now if we buy a single-family home and it cash flows $200 a month, that’s fine. It can just sit in the background and we can wait and let that grow. Where we’ve really been able to kind of lean in is because of the businesses we’ve built and the people that we’re working with. It’s been really fun because now people bring us deals and ask us to partner with them on them. And so I’m getting into stuff now where I know nothing, but I have a partner who, they have all the knowledge and they need other support. They might need help fundraising or they might need some capital or something like that. And so the way that we’ve approached things have changed. And that’s been really the fun part is that we have this portfolio in the background that we grow. I’m not aggressively out looking for deals, but because of what we do a couple times a year, something will come across our plate that works for us and we’ll make a move. And beyond that, we’re out doing deals for other people and sometimes we’re working with them on a flip. Sometimes we’re helping them get entitlements done on some property that they have that we’re going to manage on the back end. There’s just, it’s so much different than just building a portfolio. There’s just all these little things that we have our fingers in and I’m learning every single day and every single day is different and it’s changed the way that we make money. And we’ve been fortunate enough to get to the point where not only is our own personal portfolio kicking off money, but we can also use some of the capital that we’ve raised to do hard money loans or finance flips and partner with people and that kind of stuff. So it’s just a whole different beast than it used to be. And when that kicks off a little bit more money, then maybe that’s what we use on the next buy-and-hold property. And then we start the process all over.
Scott Trench: Do you take full advantage of the real estate professional status, the losses from buying new properties, and then the benefits of being a business owner and using, you know, huge deferral amounts in, you know, solo 401(k)s and that kind of stuff?
Corby Goade: Absolutely. Not as much on the retirement account side of things. But I mean, the reason I’m sitting in this building, we closed on this building on like December 27th for that very specific reason is that we wanted to have the accelerated depreciation for this last year. And it was already in service because we had tenants, we inherited it with tenants already in place. And so yeah, absolutely. That’s become a big part of our strategy is making sure that we’re taking advantage of all the tax benefits of owning property and being self-employed.
Scott Trench: One follow-up question there. Thank you, by the way. I’m having a lot of fun with this. Sure, sure.
Corby Goade: You know, I’m having a blast.
Scott Trench: Wonderfully transparent with how you do all this stuff. On the depreciation side, if you take a lot of—buy a lot of properties, lever them up and cost seg them, then the recapturable basis on sale is much lower than your loan amount, presumably, or very, you know, very close to that, because you have to pay taxes when you sell it, because you’ve taken the depreciation, you got to recapture that. Do you ever kind of think about that in the context of your portfolio as a risk in continuously buying, keeping pretty high leverage, it sounds like across the portfolio, and using this rapid depreciation that will eventually have to be recaptured? How do you think about that? In the context of when you think about your net worth?
Corby Goade: This is not really great financial advice, but I’m not really a worrier. I don’t stress out about stuff very much. And so for me, the way that I look at that is, it’s funny, I’m actually going to meet with our accountant here in a couple of weeks and talk about this exact same thing and have kind of a quick overview of what we’ve got, because I know that we have a handful of properties now that have kind of lived their useful life in that regard. And so what we’ll most likely do is 1031 those and scale those up too. So I’ve got a couple single-family homes. As a matter of fact, that first house I bought, I might sell it this year because it’s producing good cash flow, but we’ve used all the depreciation out of that property. And I could sell that and take the equity and buy a fourplex or an 8-unit and kind of start that clock all over again. Obviously we’d be re-upping our leverage and increasing our risk in that way, but by moving that equity, it won’t really affect our cash flow in any way, and it’ll give us a higher depreciable basis on that next property. And so I plan to just continue doing that as long as I can, having faith in our market that there will always be demand for the products that we’re buying and that we’ll manage them well and treat our tenants well, and that it’ll continue to be a win for us and for our tenants and the people we work with.
Scott Trench: Tell us about the market in Boise right now. At the risk of asking a local broker and wholesaler, is it a good time to buy? You know, is it a good time to buy? Can you find good deals in that market right now?
Corby Goade: You know, the funny thing, the short version of that, of course I’m going to say yes. That’s the short answer. Of course I’m going to say yes for a lot of different reasons. But the reality of it is I get phone calls like this from people all the time. Is it a good time to buy and are there good deals? And it’s kind of a loaded question because a good deal is very dependent on where you are in life and what your risk tolerance is. And there’s give and take to everything. For instance, if you bought a single-family home in Boise right now that was sort of turnkey that you could rent out right away, you’d probably, for an entry-level home, spend $350,000, you’d probably rent it out for $2,200, something like that right now. I’m a firm believer that over time our market will continue to appreciate and rents will continue to go up. We don’t have a vacancy problem or a demand problem here. Demand is huge. Vacancy is incredibly low on the long-term rental side of things. The Boise area has not been over 2% vacancy for nearly a decade now. So that’s not really an issue here. It’s more of an issue with wages supporting appreciation and all the challenges people have with income right now. But demand is really high. There’s high-quality tenants here. It is probably the most property owner and landlord-friendly state in the country. It’s just small and there’s not a lot of people here. Anyway, I’m kind of going off on a tangent, but the difference is that over time, properties here I think are going to appreciate significantly. Maybe not actually the year after.
Scott Trench: What’s a bread and butter deal that an investor, a retail mom-and-pop investor buying their second through fifth rental is buying with you these days?
Corby Goade: We do a lot of deals on small multis and single-family homes, but kind of bread and butter deals. We do rehabs for our clients too, and I’m not trying to give a sales pitch, but part of the thing is, our business is really built on repeat business. So I want to make sure that every deal we do with somebody works really great for them. And so we’ll handle rehabs for them as project managers. We don’t charge fees or anything like that because I want them to have as much equity as possible on the back end. Anyhow, we do a lot of deals on single-family homes here that are kind of in that $300,000 to maybe $325,000 range that are cosmetic fixers. Generally, they’re putting $20,000 to maybe $40,000 into those, and we end up with an ARV in the $400,000 to $425,000 range. We rent those out for $2,200. So depending on their financing, they might be cash flowing a little bit, but they’ve got a chunk of equity. And if we ride that for a while, I think that those are going to be good long-term investments. But the kicker for me and with the clients that I work with is if the property’s not taking money out of your pocket every month, if it’s cash flowing in some way and you have a minimum of 20% equity, you have options. And as long as you have those 2 things in place, if you don’t like the deal when the rehab’s done or what the rent is going to look like, then you sell it, you make a couple dollars, you move on to the next thing. In my opinion, when people start really leaning into the cash flow and they’re giving up equity or terms, they can get backed into a corner. And so that equity, a lot of people—and I know it’s kind of an old school BiggerPockets thing, but talking about cash flow is the only thing that matters. But if you’re only talking about cash flow, you only have one exit strategy in a property, and that can be a dangerous place to be.
Scott Trench: Well, love it. What would you say would be the number one tip you have for somebody who’s stuck or unsure in today’s market? What would you tell ’em to do? What’s the one action they can take?
Corby Goade: The one action you can take is get out and talk to people who have done what you want to do. And I know you talk about this a lot, Scott, but I mean, house hacking your first property, it is like you said, pushing all the chips into your favor. You’re going to have to pay to live somewhere. You’re going to be paying somebody else’s mortgage down and building equity for somebody else if you’re not doing it for yourself. So if you house hack a multi and get roommates, rent out another unit, that sort of thing, in almost any market in the country, if you lean really hard into that, it’s going to be really hard to not cash flow positively, especially if you’re taking your own living expenses into account. I think that that’s absolutely the best way to start is for somebody to house hack a small multifamily, especially if there’s a value-add component where they can do some landscaping, some paint, take really good care of that. I think that that’s the first place to start. But beyond that, just getting out and networking and talking to other people who are doing it. Every town has a group of investors that get together on a regular basis. And there’s usually Facebook groups. There’s definitely Reddit chats about people that are out doing this kind of stuff and just connecting with other people who are doing it. You’d be shocked at the resources that are out there and the other people who have a skill or resource that you don’t have that are looking for somebody that has what you have. And if you are new to this, you might have time or energy that other people don’t have that they could make good use of.
Scott Trench: Well, is there an
Scott Trench: Fair enough. Okay, fair enough. I think that would be really interesting for you to do a counterfactual and say, like, what is the other alternative I could have invested in at this time? And how would it have performed relative to that real estate? Because I think your real estate crushed it from the last 15 years. And I think it stunk, probably from a returns perspective in those first 10 years, relatively speaking. But I could be wrong.
Corby Goade: No, no, no, no. I love that perspective. I’m actually gonna go back and do that. I’ll follow up with you.
Scott Trench: I could be completely wrong. That’s just a guess at the top of this. But where can people find out more about you, Corby?
Corby Goade: I post on BiggerPockets whenever I can, so I’m on there quite a bit. They can jump on our website, it’s just BoiseTurnkey.com. I blog on there pretty regularly. And in all honesty, if anybody’s listening to this and they just want to chat real estate, or they want some advice, my email is on our website. Shoot me an email, shoot me a text. I’m happy to chat with anybody, even if you’re not anticipating doing business with me or in my market. If there’s some way that I can help somebody out there, I love giving back. So don’t be shy.
Scott Trench: Corby, how many forum posts do you have again?
Corby Goade: I have no idea. A couple thousand, I think. I’m not sure.
Scott Trench: You are a power contributor for the BiggerPockets forum here with thousands of posts. You’re all over the BiggerPockets Money group, the BiggerPockets group. Thank you for all you do. It’s just wonderful.
Corby Goade: Yeah, it’s my pleasure. We didn’t talk a whole lot about it, but—
Scott Trench: 3,250 posts, with 33,000 votes. All right.
Corby Goade: It’s funny, I always want to have more votes than posts. So if my posts get up too high, I’ll wait for the votes to get up there. But we didn’t mention earlier, when I was really getting into this is when BiggerPockets was really starting. And I connected with some local people through BiggerPockets here that I never would have connected with otherwise. And just hearing other people around the country doing the same stuff on the podcast, it was awesome. So BiggerPockets has been a huge part of my experience too. And so I appreciate what you guys do.
Scott Trench: Well, thanks for being part of the community and sharing that. And look forward to staying in touch.
Corby Goade: Thanks for having me on.
Scott Trench: And that was Corby Goade. Go check him out. He’s all over the BiggerPockets forums. He’s in the BiggerPockets Money Facebook group, and he has been a wonderful friend to BiggerPockets and to me personally, supporting me online in particular over the past ten years. So really grateful to him and many of the other folks who contribute regularly to our forums. It’s always fantastic, especially to get to meet those folks in person at various points. I thought that it was pretty interesting that Corby thought he was really lucky, and in some ways he was lucky, right? Being a Boise real estate investor, you experienced some of the hottest real estate appreciation in the country during one stretch there from 2015 to probably 2022. But there’s a lot of trial and error, and it wasn’t always like that for the first 10, 15 years of Corby’s career. So I think there’s, I think it’s a pretty interesting lesson there in that these appreciation waves come in waves, come in cycles, it’s kind of hard to predict them. And that staying power can really be beneficial over long periods of time. So maybe that’s a lesson for folks that are struggling through challenging rental dynamics today. I think there’s a lot of really good arguments that with lower supply on the horizon in real estate, there’s a good argument to be made that this is potentially close to maximum pressure, maximum pain in many markets around the country, and that things will abate over the next several years. We’ll see if that comes true. But that’s something that I would probably be biased towards at this point. And I’ve said so publicly on a couple of past BiggerPockets appearances.
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