How To Invest In Real Estate For Passive Income

How to invest in real estate for passive income. So this is totally my wheelhouse and how I became a millionaire. So we're going to share with you strategies, very specific strategies on how to create passive income by investing in real estate. So to do that, I'm going to bring in one of my partners, Justin Bennett, who has been amazing in real estate. He has gone from losing it all to rebuilding it. And passive income is king. We do some Airbnb's together, short-term rentals, long-term rentals, and he knows how to build it in the streets and operate for those of you who are serious about getting this done. So let's click over and let's hear an interview with Justin. So welcome back. This is Laurel, and we are going to talk about how to create passive income using real estate. Number one, we're going to talk about the number one thing that most people don't do. Number two, the most overlooked strategies. And then we're going to take a little peek at the HGTVs and all the TV shows and what's real there versus real life. I have my partner, Justin Bennett, with me today. We're doing business in several markets, and we're going to talk about what we call then replicate and duplicate, a process that Justin has been doing quite well. And we bring him here, actually calling in. Are you in Topeka, Kansas today? I am actually in Wichita today. All right. Well, welcome. And Justin, give our audience just a little background about you and your real estate expertise. So me and my real estate expertise came to the big table about four years ago now, and I was just getting started investing full-time. I dabbled in real estate ever since I got out of college, but decided to do it on a mass scale. We started building a portfolio of just single-family rentals and then decided to play in the vacation rental business and then had an opportunity for multifamily property come up and took advantage of it and did really well, created a ton of instant equity in it, and decided that was going to be our new niche and what we focused on. So that's when Laurel speaks about duplicate and replicating, that's what we've done. That's what we've decided to focus on, and that's what we continue to do and will continue to do. So Justin, talk a little bit about due diligence. I think a lot of people that want to get started want to invest in real estate. They want passive income. They really don't know the full spectrum of what they're, they want the goal, but they don't understand the full spectrum. Talk about due diligence and how do you begin? Absolutely. So due diligence, as with any investment, I would say due diligence is the number one key to success, especially with real estate on the front side of anything you do, whether it be a small single-family property as just a flip or building a portfolio of multifamily properties. So due diligence on the front side, most people just look at numbers and they say, if I do this, this is what it can produce. And what a lot of people overlook is scenarios and circumstances that are out of our control, like Russia invading Ukraine or the stock market or gas prices or whatever the case may be. And so as we do our due diligence in real estate, I coach a lot of students and people that want to invest in real estate as well. We have to have not only due diligence on numbers, but we have to have due diligence with multiple exit strategies, whether it is a single-family or it is a multifamily property or a vacation rental, you know, when COVID hits, what does that do to our vacation rental business? If we can't rent it on a short-term rental basis, what can we do? Is there enough population in the area to turn it into a long-term rental and rent it on a three to six-month period? Or, you know, if that flip we want to do to make a quick $50,000, you know, if the market corrects itself and our profit goes through the drain, are we able to rent that out and still make a return on our investment until the market corrects itself again and we can sell it for that profit? Or, you know, what's our actual strategies? And so I definitely say due diligence on the front side with multiple exit strategies or multiple planning stages of a process is key, especially in real estate investing. So as part of your due diligence, I mean, what are some, give them a few tips on how to decide what strategy to use? Because there are so many strategies that you can go into and I find a lot of new folks kind of wander around in that strategy selection. So just as you coach everyone, Laurel, a lot of people's due diligence needs to be based on, you know, what their money rules are and what they're trying to accomplish with the investment at the time. You know, if I'm just getting started and I want to build a portfolio but I only have $20,000, maybe I need to go flip a couple properties so I can start adding properties to a portfolio versus, you know, just going and buying one and waiting a couple of years until I can buy another. If I can go flip two or three this year, then I can buy five next year as opposed to building slowly. And also, you know, what's your end game? Is your end game to be a full-time real estate investor and it's your full-time job and it's what you do like myself? Or is it to be like Laurel and many other investors that just want to be a part of it but they want somebody else to manage everything? And so, you know, that's another huge key is what's your focus? Where are you going to spend your time? And how do you want it to work for you? So, let's take a little stab at the HGTV who got busted by, you know, doing some flip shows and they were really, you know, on a Hollywood lot inside of a building and, you know, staging sets. You know, unfortunately, there's a lot of really uneducated people who follow TV as their learning experience. And having been on TV, it's entertainment, it's not education. So, talk about some of those differences, obviously, and what we do that's really real. I mean, people out here listening, again, it's real estate for passive income. What do they really need to know? Well, like you said, you know, TV is for entertainment almost exclusively. One thing that the HGTV shows and the HGTV heroes, we call them, the investors that think they can do it because it was on TV. There are a few good things that you can learn from those shows. And that is, you know, what's in style? What are the trends? What colors are being used? What finishes and fixtures need to be put in properties to sell and bring the most money or return on your investment? But what you don't see is the realistic expectations and problems that you run into. You know, there might be a stage problem with the plumbing line or termite damage or some electrical panels that have to be replaced. But in every project, you're going to run into multiple issues like that. And, you know, being able to budget and account for that or your subcontractor is not showing up on time or, you know, supplies and materials and being out of supply or being out of stock and no inventory or prices going up in the middle of your project. And you don't see all these things. And so they make this great rehab project fit into an hour segment. And in reality, every single day of this rehab or of this project, if you are the active real estate investor, you are dealing with moving pieces that have to fit together in order to work. And so, you know, the TV doesn't do a real good job of showing all the different moving parts other than, hey, here's my contractor. Here's what they're doing. This is what the finished project looks like. And so, you don't see the missed time timing, the schedules that get thrown off, the supplies we're waiting on or things we have to change along the way or the real problems that you run into. So, that's one of the biggest things I will say that most investors aren't prepared for is the harsh reality of no project going completely as planned. Right. So, last words of, I say input, people are here, real estate for passive income. Here's what I say, knowing the decades of doing this, if you really just want passive income, when you sit in a note, right, and you're in a hard money lending note position on a fixed interest, you'll get cash flow. If you are going to take the run of the operation and the ins and outs and ups and downs, you'll have some volatility, but your returns could be higher. What would you say about those who are just saying, I just want some passive income? A hundred percent risk versus reward, where you want to spend your time and energy. It takes a lot of energy to run around and do what I do. I know that sometimes my returns are higher than Laurel's or other passive investors, but at the end of the day, Laurel doesn't lose sleep at night. She doesn't wonder about if our apartment complex is going to burn down or tenants that we're screening to let in, if something's going to go wrong, anything like that. Whether or not to be passive is really what your goals, what your risk versus reward look like, and how much energy do you want to expend on your investment? When you park money in stocks, do you worry about what Apple's doing every day? Do you go to the Apple store and watch how many customers come in and out? Or do you buy Apple stock? When you invest in real estate, do you want to have to have somebody at the property every day to make sure nothing's going wrong or fixing everything that needs to be fixed or paying taxes or insurance or all of the above? It's how much time and energy do you have versus how much safe investment with a hard asset backing it with a decent return paying you day after day. So before we wrap this video, I want you to subscribe to my channel, click the notification button. And by the way, if you want more information about real estate, I've been in real estate since 1999, solidly before that a little bit, and a millionaire in many, many different categories and strategies of real estate. So put in the comments below what you want to learn more of, and I can bring more of that content to you and share this with other people. Let's begin a conversation about money. What I want you to do now though, just so we get to know each other more, is I want you to go to my financial personality quiz. I want you to take the quiz. It's going to put you into one of four profiles. From that, we're going to send you an application to talk to one of our team members. And if any of you are serious about becoming a client and you have a teenager or a college-age student that wants to come and intern with Justin and I, we have an internship program now, and it's crushing it. These kids are getting a world-class education in Kansas, but it's serious, and we do great work. So with that, I'm going to send out the application. I'm going to send you two tickets to my marketplace, and we're going to continue this conversation about money and making you a millionaire. I'll talk to you tomorrow.