EYL #170 Keys to Master Real Estate Investing

having home. Who do you have to pay property taxes to the government. Everything they told you to do in the American dreamer so that they could get paid.

They hit me every day non stop. But that's a good thing because I mean, if they're out hunting for deals, they're hungry. So what he does is he teaches people about not just how to buy real estate, but specifically multifamily homes and multi family homes is something that is extremely important, especially like where we live in the Northeast, but really different pockets all over the country. And MG

has spoke about multifamily homes before. Actually when he first came on the podcast, that was his whole strategy as far as you know, get a multi family and have positive cash flow and things of that nature. So we're going to have a really interesting, dope conversation about real estate multi family homes, and I'm sure there'll be a lot of gyms dropped so first and foremost, thank you for joining us, brother, appreciate it.

I chose Stanford. But everything that I've learned about business that has allowed me to create the wealth that I have today didn't come from Stanford. It didn't come from the marketing class there, It didn't come from the finance class there. It came through actually reinvesting back into my own education, in my own mind, through coaches, consultants, and things of that nature. After But my real estate journey actually starts with my mom. She was a doctor, anesthesiologist,

and she had a good paying job. She was following the American dream and she ended up with a mental health issue, not anything to her fault whatsoever, and that mental health issue caused her to lose her license. And once the one single income stream evaporated, then she couldn't pay the mortgage on the home that we had in Oakland.

That home today is worth one point eight million dollars and so when I saw somebody who did everything that they were supposed to do actually lose it all because they were lying on one stream of income, even though it was a high stream of income, that made me

choose a different path. And so in college I read Richards That Poor Dad, like many people did, and I knew immediately, not only from my own mom's story, but from that book that my first property was not going to be a single family home, that it would be a multi family home. And so I purchased my first multi family home in Brooklyn. It was a triplex twenty thirteen. And the moment I went from paying expensive rent in Brooklyn to being paid expensive rent, the game was over.

And so you know, as I started trying to go deeper into the game, buying another property in Brooklyn was challenging because I used FAHA for that first property, but the next one will require twenty five percent down, and when you have properties that are a million dollars, twenty five percent down is going to be a quarter million.

So I decided to scale my portfolio by investing outside of Brooklyn, and that's how I found the New Orleans market, and from there I just doubled down and continue to scale my portfolio eventually moving down to New Orleans and things of that nature.

that your counselor is solid. If your counselor's not solid, then it's going to be a difficult journey for you. And then it's also your persistence. You have to stay on that person. You actually have to lead your counselor to get to the finish line. So if you're just going to sit back and think that some program is literally going to give you a home for nothing and you don't actually put in any effort, it's going to be a hard road for you. So I've had many

people closed through my program. See, NACA does the financing, but they don't teach you how to find the deal or how to finalize the deal. Financing is actually the easiest part of the real estate game when you know about programs like NAC or faha. So NAKA actually is not a program for poor people. So that's actually what keeps half the people out is because they have a perception that is for people who have low income, and

it's not. What's powerful about it and why people with low income are able to go through the programs because there's no credit score consideration, and that's huge for a lot, no closing clues, no points or fees payment, and no credit. So here's how they verify you. So basically, they take whatever you've been paying in rent plus whatever you're able to prove that you can save over a three month period.

So if you're paying twelve hundred dollars a month in rent on time consistently, right, and you're able to show them that you're able to save an additional three hundred dollars a month on top of that, then they'll prove you for a mortgage of fifteen hundred dollars, gotcha. So that's how they verify your ability to afford the real estate. And so NAKA has two tiers of people, they have priority and non priority. So priority is anyone who is making eighty percent or less of the area's AMI. So

AMI is the area's median income. So those people are able to get interest rates as low as two percent. Two percent, that's basically free money when you account for inflation being six percent, right, So, and then a non priority members who have higher incomes start at three percent. But then what NAC actually tells you to do is that since you're no longer paying a down payment, why don't you buy down these points? Right? And so a

point is a percentage of your mortgage. So if you have a mortgage of three hundred thousand dollars, you could pay three thousand dollars one percent of that and actually

buy down your interest rate. And they have tiers where their interest rates when you pay three thousand dollars in advance, the bank is taking that three thousand dollars in advance, then your interest rate is going down by probably like zero point one two five, Right, So you're a quarter, not an eighth of a point every time you contribute three thousands. So rather than putting that towards the down payment,

because there is none, you're actually buying down points. So you'll see people in NACA have interest rates that are less than one percent. And so when you look at that over a thirty year period, a decrease in interest rate by one percent on a three hundred thousand dollars mortgage, that's going to save you sixty thousand dollars over the life of that loan.

had done. But I know, so some of the downside is like people saying like it takes a long time and it's like tedious process.

hit the ground running. But if I start without any financial discipline in advance and then have to go through the process of demonstrating that I can save this amount of money for this particular mortgage, that's going to take me an additional amount of time in order to qualify and get pre approved by them. So it's just coming to the table with your financial house in order first, and that accelerates the process for folks.

But naka are likely not. And so if you want to scale your portfolio beyond NAKA after you use NAKA, you're actually going to have to refinance once you're out of this amazing interest rate right to go conventional to free you up to be able to go use one of the other loan programs, or go conventional and scale your portfolio up.

have be at eighty percent loan to value. Now you put zero percent down, So you either have to force that appreciation or you have to have bought so right that it is appreciated to that extent over that period of time, over that five year period.

everything in order. And you know, it's definitely beneficial for I've known some people that definitely have been able to purchase home through the NACO definitely.

Title fees are a pair of Jordans. She got a triplex in Philadelphia for a pair of Jordans or a round trip flight from New York to Los Angeles, Like anybody can do that, but you have to know that it's there, and you have to be persistent and you have to be financially disciplined to be able to get qualified through them ERNs.

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immediately cash flowing. There's no other business that you can buy for three hundred thousand dollars like that that quickly. And so this is why FAHA is so powerful. So FAHA typically requires about a six to eighty credit score to get qualified. It actually can go down. But if your credit score is below six eighty, then your interest rate or your down payment are going to increase on FAHA.

There are FAHA guidelines. These are federal guidelines, but lenders can stack on their own lending guidelines on top of it. So just because FAHA says that the credit score minimum is six eighty or other lenders may say, no, we actually need a seven twenty in order to qualify you for that, so they can stack on their own guidelines to FAHA. But FAHA is really powerful. That's how I acquired my triplex in Brooklyn with the FAHA loan. And the downside of FAHA that people don't tell you is

the PMI. It's a private mortgage insurance. Not going to and have private mortgage insurance, and so private mortgage insurance means that their banks are literally the government is actually protecting the banks, like they've already bailed up the banks. I don't know why the banks need protection, but they're protecting the banks. And so there's this additional private mortgage insurance.

So it could be an additional one percent fee. So again, if your loan is three hundred thousand dollars, one percent is three thousand dollars per year. You divide that by twelve months, and now you're paying an additional additional two hundred and fifty dollars per month on your mortgage payment for this private mortgage insurance. And now that PMI is actually permanent. It's permanent until you refinance out.

going to be higher, et cetera. So the interest rate is not dependent on whether it's a duplex, triplex, or four plex. The interest rate is based on your financial profile.

So yeah, but that's the key to buy and right. If you don't buy right, then you have to literally just sit and wait and continue to cough up this extra two hundred and fifty dollars a month that is just literally there to protect the banks.

be ten thousand, five hundred. What's powerful about the two O three K loan is that you're going to get a two or three K consultant who guide you through some of the rehab process, and you're likely going to step in and built in equity because you took something that was run down, you put in one hundred thousand to it, it's now like a brand new home. So even though you have three hundred thousand in, you build equity. So now you're stepping into equity right out the gates.

And that's one of the keys to buying right. So we don't just want people to go out there and buy real estate, just like we don't want people to just go out there and buy stocks just because we said so. We want you to buy right. And so buying right is three criteria. First criteria is that you're stepping into built in equity, meaning that your a praise price is actually higher than your purchase price. So you're stepping in equity right out the gates. You won out

the gates because you have equity. The second criteria is that in multifamily at at least a twelve percent castional cash return in the rule of seventy two. Seventy two divided by twelve means that your money's doubling every six years. The money that you have in the property is doubling

every six years. And then the third criteria for buying right is that there's definite appreciation potential and definite appreciation potential means that I've identified thirty three signs of gentrification, and definite appreciation potential means that you bought on the

right side of the wave. And so when I bought on Fulton and Utica in Brooklyn, there was about ten to fifteen signs of gentrification there, right, and that was called do or die pad stot at the time when I purchased it no longer right because I saw it coming from Dumbo, correct, it was coming from I saw the wave coming from Dumbo right to Fort Green stuyves and the heights to Best Stie. So I saw the wave.

So I bought right here. I bought right here when the wave was here, and I've been able to ride that wave all the way through East New York. So that's definite appreciation potential because now that neighborhood has thirty of the thirty three signs of gentrification. So every time a new sign is added, the equity is going up.

my property I find is off market deals. So I'm not competing with people because once a property hits one of those websites, there's a thirty percent premium because now demand is increasing because everybody in the world is seeing that property that's getting emailed out to everyone. Right, So I'm looking for off market deals. And how do you find off market deals? You find them through relationships, through human beings. So my real estate rollodecks in New Orleans

about sixty six people, multiple agents. That's a gym. I don't just have one agent like a lot of people that you just get one agent let them go do all the work. Don't have multiple agents? Why would I restrict my search to one single agent. Now, if that agent happens to be the best in the city at identifying multi family properties, I'll sign an exclusive agreement with them. But otherwise, whoever brings me the deals, who's going to get the commission and get paid. I have contractors, I

have lenders, I have other property owners. I have friends and family who are looking out for me. Why would a contractor be looking out for me? Because if they find a deal and bring it to me, who's going to get the work? When I need to rehab that property? The contractor is right?

And it's got to be word of mouth. Like my real estate Rollodecks has been built by word of mouth and then pulling up people on site and testing them out, so you might test them out on painting one bedroom before you test them out on painting the entire house that you have, right and see what the quality of work is at that level. But back to the question at hand, so off market deals. The other thing is that the only thing that beats a cash offer is a fast offer, So you have to be confident about

what you're doing. And when it comes to evaluating multi family real estate, there's actually twenty three numbers that you need to know. When you're buying a single family home, is how much would we get approved for right? Four hundred thousand? How much is the home three eighty do

we like it? Yes or no? Three factors. When you're buying multi family real estate, there's twenty three numbers that you have to know to evaluate a deal, and if you leave out one single number, you can literally step into a bad deal that will set you back for five to ten years. So you have to know how to run those numbers. If you are on Trullian Zillow and you're over here heart and stuff and bookmarking stuff,

I know you're not ready to play this game. Because when you are hurting something on Tuesday, right and put it in your favorites folder and you talk about, I'm gonna come back to it on Saturday, what's the two words under the listing every time you come back to it on Saturday pending under contract? Because you didn't know how to play the game, somebody else saw the deal and moved on it. So you have to be able to make those decisions confidently. And it's all based on numbers.

Multi family real estate is purely based on economics, not on emotions. So I don't make emotional decisions when it comes to multi family real estate. For instance, the property that I bought in Oakland, I was living here in Brooklyn. I ran the numbers and my offer was in within one hour of the listing being up, within one hour, right, no hesitation whatsoever. I didn't have to see the property.

I've actually never set foot inside of this property. I bought that property for four hundred and eighty thousand dollars and twenty seven months we got a rear praise twenty seven months later, as were seven hundred and ten and I've never set foot inside of it. So for those who are in expensive markets, your money does not have to work in the same city as you do. Some people have bought Amazon stock never been to Seattle. You

bought Nike stock and never been to Oregon. Your money does not have to work in the same city as you do. So when you understand how to run the numbers, and you know certain neighborhoods, and you have a great agent on the ground in that market, you're not limited to where you are. A lot of people think, oh, real estate, it has to be where I'm living, and that's cool. Typically I tell people here's the four markets that you should invest in, and a lot of people

think that they're cities. No one investor. First try to invest where you live. Okay, if that doesn't work because it's too expensive for something like that. To invest where you're from, Because you know what was happening there when you're growing up, you're able to see the patterns and the trends. That's why I invested in Oakland, right. Then three invest where you want to be a contribution, So for me, that was New Orleans. I want to be

a contribution to that culture. And then four invest wherever you can make money. I've never invested purely in a place because of making money. So when it comes to real estate being expensive where I am, let's just calculate how expensive you paying rent is for the next five to ten fifteen years.

So when an expensive market like typically we're looking for a twelve percent cash on cash return, right, But in a market like New York, you might have to settle for the fact that the money that's coming out of my pocket is less than what I'm paying in rent. So if I'm paying if I'm negative two thousand in rent in New York and I'm able to find a multifamily that only reduces my house an expense to five hundred dollars. That's actually a win in an expensive market.

Is that the ideal twelve percent cash on cash return when my property is now paying me no, but it's actually changing my cash flow of my family because now I'm up fifteen hundred dollars a month because of this multi family. So these are some of the keys being willing to invest from a distance, reevaluating the numbers and comparing it to how expensive rent is, because that's going to be there unless you've changed something. Rent is going to continue to be there. There's only three ways to

get rid of your house and expense forever. That is one live in a tent, two go to jail, or three by multi family real estate. So you talk about twenty three numbers to know what are some of the numbers. Yeah, so you have to know the rents obviously, right, just because a seller gives you rent role doesn't mean that those are the actual rents. You need to know what the actual rents are. You need leases, you need to verify those.

most owners are just individuals. Some of them don't have good accounting around the actual cash flow of the property. But you have to know what you're getting into, especially in this market where you have COVID restrictions and you can't evict people, et cetera. You got to actually know those things. And so I'm asking for bank statements. I don't need to see your entire bank statement, cross everything out, but I need to see when that money actually hit

the account, right. But then we use other online tools like rental meter to actually identify how much should this particular unit be getting right, and so if I see that a seller has not increased rents for ten years and the rents are actually at one thousand dollars, but I run the numbers over here and look at the standard deviation because that's what a rental meter does, and I see that could actually be commanding thirteen hundred dollars a month, then I might have found some hidden value

in a particular property. Now, as an ethical investor, I'm not interested in displacing people. So I'm not like some of these other real estate folks who say, yeah, just come in by the property and just kick the people out. Know, as ethical investors, we put people before profit. We put people before profit. These we want our people to stay in our communities. But what's crazy is that a good investor actually has to increase rents every single year. And

that was that was a hard awakening for me. And here's why. If I'm an owner in Oakland and I don't increase rents just because I want to be nice to my tenants, right then when I want to sell my property at eight hundred thousand dollars, a property that I got fifteen years ago for three hundred thousand dollars, the crints will not justify that to a seller, and therefore I will be stuck in that property and never

be able to get it off. So I'll literally not be able to ever get liquid or release that property because the rents don't justify it. And so we increase rents according to the CPI in that market. So if the CPI in Oakland will win up three percent that year, then we're going to increase rents by three percent because guess what, my other expenses are going to go up

three percent. My contractors are going to go up, my utilities are going to go up, my garden is going to go up, and so in order to provide you, taxes are going up. So in order to still provide you with the quality housing that I desire to provide for you, I have to be able to meet that. If I think just by being nice right and keeping your rent where it is, then ultimately I might not have enough money to fix that roof leak because I didn't increase rents, but all my other expenses went up

during that period of time. Yeah, so this is this is really key. So even as an ethical investor, we have to increase rents, but we don't increase rents in such a way where it's going to be from one thousand and thirteen hundred just like that, or else you got to get out. That's not that's not how we treat people.

Like in New Orleans, I typically won't hire somebody who's in hospitality, right because, especially in this COVID environment, that hotel shuts down or flights or canceled things of that nature. Now their income is fluctuating there. For that means my income is going to fluctuate so you have to be very mindful about who you actually attract. So some of those other numbers include your property management, right includes the

g gardening. Like if I look at a property online and I see that it has no grass or a lot of grass, I'm going to put aside a eighty dollars budget a month for a gardener if it has grass, because that has to be up kept. They're literally cities that will give you give you tickets for not upkeeping your yard. Right, I have to know my cap X. Cap X is my capital expenditures. Those are about ten

percent of rents. So if rents are four thousand dollars, I'm going to set aside four hundred dollars a month in a separate account for roof, foundation, electrical plumbing, and things of that nature. Right in HVAC, I'm going to set aside money for those things that I know will come. They might not be immediate right now. I may not need a new roof right now, but I need to set aside a portion of rents for that repair reserve.

Like the sink leaks or a hole in the wall, or rodents or something like that, that's I'm gonna set aside five percent For that, I got to know my interest rate, right, I got to know my down payment these are I got to know my PMI. So all of these numbers factor into seeing if this property is actually going to cash flow at the level that you desire. And again you leave out one numbers, especially a number like tax. You think you're buying a cash flowing property.

Then you see that your taxes in New York at eight thousand dollars a year, and you realize that you're negative, that you went backwards. And the key thing about tax in calculating taxes when you're running your numbers is that the tax assessment is usually going to be based on the purchase price that the previous owner purchased the property at, right, and their taxes are going to be based on that.

But once you purchase it at two times or three times what they purchased it at because they were sitting on it for twenty years, it's gonna get reassessed and your taxes may double or triple accordingly, So if you were running your numbers based on their taxes, you think

your property is cash flowing. But then when it gets reassessed a year later after you've owned it you realize that you're actually in the negative because you didn't account for the fact that it was gonna get reassessed at the purchase price that you bought it for.

So I'm literally going to scream my section eighten It's just like I was a screen market rate tenant, and I'm looking at how she treats her kids. I'm looking at how she how she keeps herself, right, I'm looking at language, tone patterns and things of that. I'm looking at the application if the instructions were followed, and things of that nature. So I'm literally screening my second e tenants and my Section eight tenants. I'll be honest with you, they all

of mine have been good. People fell on hard times. So I had people who got displaced by Katrina. I had people who who lost a husband, things of that nature, and they just experienced something that knocked them off their feet, and they're trying to get back on their feet. And now I get to be a support mechanism provide them a quality, affordable housing so that they don't have to worry about that piece by living in a neighborhood that is not actually conducive for their kids to grow up in.

So I love my Section eight tennis. They love me. And on top of that, they typically don't don't leave unless family size expands. They typically don't leave less family size expands. So the section it's still in this for a minute, So it's Section eight. People I think think that Section eight they automatically assume projects housing projects. But you can have section eight.

like that. So if you want to avoid any delays in getting your first check, you kind of want to start to learn what they actually look for so that when they actually do come and do the inspection that you're ready to go and the transfer can happen and.

had to have that experience. But it's the same thing, and you want to know the for Section eight I typically go through, I would have to go through housing for I would go through the Section eight office. But for eviction, it's really key for anybody buying more time.

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You should be able to tell me that because when you're looking at truly in Zilo, you're looking from a property level. But we need to see how your city is trending. Where are people moving to? Right, So as rents increase in major urban centers, people are leaving and they're going somewhere, and so you need to be able to tell me in your market where are people going. So Mesa, Arizona was one of the hottest rental markets in the country. And you know where Mesa, Arizona is.

It's fifteen minutes outside of Phoenix. So Phoenix was getting gentrified and people deciding where do I go that still can get me to work? And Mesa happen to be it. So you need to find that smaller secondary market that is around it. So once you've identified a neighborhood, now you want to start driving for dollars, and you want to start looking for where there's trends, where you're starting to see the ten to fifteen signs of gentrification, and

you want to target your search specifically. There then comes personal branding. You have to let people know that this is actually what you're looking for. You need to be

very clear in your language. I'm looking for a triplex the in seven eight oh two for the price range of two hundred and fifty thousand dollars, and you need to start communicating that to not only agents, but to everybody around you so that when things happen, so for instance, somebody's parent transitions or their grandmother transitions, and the children do not want to buy. No child of the four wants to buy the house from their siblings.

means also skip tracing. So driving for dollars, you're driving through neighborhoods and you're looking for properties that are boarded up, you're looking for properties that had overgrown grass, you're looking for properties with twenty newspapers in the front yard, and you take down the address and you do what they call skip trace, and skip tracing means going online and actually identifying the owner through the assessor's website or through

white pages dot com. Right, So you skip trace, skip trace them, you call them, you text them, you mail them, right and you ask them if they're what they're doing, what their intentions are for that property. So the home that I live in, my single family that I live in now, I didn't get a single family until I had twenty doors, right. So, but my home that I live in now, I skip trace the owner. I wanted

that property. I saw it sitting there vacant, and when I first found her, she said that, oh yeah, I plan to move on there, finish the work that's in there, et cetera. Because it was down to the studs already. And it took me a year and a half to get that property. But I'm the only one that knew that she was in a in between space about what she was going to do with the property because I was the only one who did the research. So I

got that property at a discount. I got it for I think put in sixty finished it out really nice and it's worth it Actually is getting re praised this week, and I think it's going to praise it three hundred thousand.

They don't want to live in the same house that somebody is above them or somebody is blow them.

you to sleep. Everything they tell you to go to college, who gets paid off that student non interest the government? They say, go get a high paying job, who gets paid Take the money off the top the government. Then they say go get a single family home who you have to pay property taxes to the government everything they told you to do in the American dream so that they could get paid.

You still are renting. You're not rented from a landlord. You just rented the bank's money. What is the bank's money rented called? It's called interest. You're renting money. You're not renting a space. You're renting money.

your lender a home at the same time. And if you look at the mortgage payment, like, what bank would you go to where you put in two thousand dollars into the account and you only get credited six hundred? Would you bank with a bank like that? That's what a mortgage payment is. Your first mortgage payment or FHA loan at three point five percent down is seventy percent interest. So you put in two thousand and the interest was

fourteen hundred. That's a terrible transaction. So when we look at that, a single family home is a dangerous way to try to begin your real estate journey because if you're not careful, this is what's sick. If you're not careful.

When you add in the interests, the private mortgage insurance, the property taxes, the homeowner's insurance, and the maintenance of that property, a single family home buyer can actually have more money going out of their pocket due to housing than someone who is renting the same square footage across the street. Now, people say well, Julian, my house appreciate. The appreciation only is covering the interest that you were going to pay to the bank. You're not really up,

it's only covering the interest. And so we have to be very careful about calling a single family home an asset when it really isn't. And if you haven't leveraged it, if your money is stuck, even if it has appreciated, and your money stuck in the walls, then it's just sitting there doing nothing until you actually liquidate. And liquid eate doing means selling, and once you sell, you have no place to live. So this is very key. Now

there's four financial benefits of multi family real estate. I've talked to you about cash on cash return, and so I have a duplex in New Orleans that I spent the price I didn't spend, but the price is three hundred thousand dollars. So let me just break down over the next thirty years how much that property is going to pay me. It does not look like a million dollar home, but it actually is when you actually look

at the numbers. So over the next thirty years, that property is going to pay me six hundred and thirty eight thousand, dollars in cash flow. That's after principal interest, taxes, insurance capecks, or pairs of a vacancy rate. That's money in my pocket over the next six hundred over the next thirty years. Then the tax say savings on that property, money that I do not pay the government, will be

two hundred and seventy eight thousand dollars. I'm getting two hundred and seventy eight thousand dollars in tax savings on a three hundred thousand.

additional one hundred and four thousand dollars. So you add all that up, that's one point two million dollars. So this is a million dollar property, and I still have the property, which is also now I still have three hundred thousand of equity as in the property, so it's actually one point five. So this is simply off of a three hundred thousand dollars duplex. And when you see that,

then it becomes a no brainer. See, a lot of people are hesitant to invest in multi family real estate, especially people who are getting this fast money through stock options and stock market investing, et ceter. It's it's great, and we need the fast money and the slow money, but multi family real estate it's actually a twenty five percent return. It's just not a cash on cash return.

If I have a twelve percent cash on cash return, and then I add in those other benefits of the principal paydown, the tax savings, and the appreciation, my actual annual rate of return is around twenty five percent. Elon musk annual rate of return since he sold, since he exited PayPal, and to what he has today, his annual rate of return has been forty four point four to four percent. So if I'm able to get twenty five

percent return, I think I'm doing pretty good. And a lot of people, you know, the stock market S and P five hundred. Guess what the rate of return is on the S and P five hundred over the past twenty years, everybody twelve percent. January first, two thousand to December thirty first, twenty twenty, the annual rate of return on the S and P five hundred was four point seven seven percent. Run you can go run the numbers right, and there's a lot more volatility in that as well.

This is consistent. My daughter will be able to inherit these if I stop right now. Just what my portfolio is, my private portfolio right now, at the age of thirty six, my daughter will have twenty five thousand dollars in passive income for the rest of her life if I stop now right because of multi family real estate investing. So what I've done is I played the long term game first.

So a lot of people, you know, they try to get rich quis games, but if they would have played the long term game a long time ago, they'd be a lot further along. So I've actually secured the long term game first. And then what that does is it frees me up to take greater risk in other avenues and other forms of investment that have more volatility. So that's been the way I played the game.

This is why they don't as manifested out here. So the biggest one of the biggest mindset shifts is and you saw me say this, that invests fast that people have to recognize that if you're renting right now, you're homeless. If you're renting right now. And I'm not saying it jokingly, and I'm kind of saying it joking, and I'm kind of serious because technically you are homeless. You literally do not have a home. You're not on the title, you're

not on the deed. And when you look at an actual homeless.

all the advantages that you have. How is that possible?

literally tell them start going and getting boxes, start packing up. Earners, listen up.

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right Maryland, right below the Mason Dixon line. And now you've been a slave for forty years, and now you're on your deathbed and somebody tells you that the Mason Dixon line is right there by the horizon, by that tall tree. The Mason Dixon line was right there the whole time. But you didn't know it. You just weren't aware of it. Once you realize that the Mason Dixon line is actually that close, you run for it. And so the ability to acquire multi family real estate. People

think you need to have a real estate license. People think that you need to have bought a single family home first. People have all these myths about what it takes to get in the game. People think that you need to have a ton of money saved. Literally, people have not gone to go get prepproved. You won't believe how many people have not even gone to go get preapproved. The reason they haven't gone to get pre approved is because their own perception of how they're shown up in

the world. You know, everybody around us perceives us in this high way like your significant other, your friends or family see you in your best life. But we look at ourselves in the lowest way sometimes. And so what I tell people is go get pre approved. I don't care how you see your financial situation right now, Let's see how the bank sees your financial situation, and you'll be surprised. You thought that you could only get pre approved for three hundred thousand dollars was not enough to

buy a multifamily in your market. But when you actually went to the lender and showed them what you had, they approved you for five hundred thousand dollars. You could have been in the game a long time ago, but you were afraid to go get pre approved. You were afraid to open up your financial house and let somebody in and come see, and you'll realize that it's not

as bad as you think. Because this is a physical, tangible asset, real estate, banks are more willing to lend against that than your business idea that you have your ten page business plan on. So go get pre approved. It costs you nothing to go get pre approved. You're going to ask for your W twos, some pay stuffs, your tax returns, your bank statements. Go literally go to the bank that you have your checking or savings account at and start there. I don't care what your credit is.

All we want to do is see what number they come back to you with. And if that number is too low to buy multi family real estate in your market, then let's fix the things. If it's your credit, then let's work on your credit. If it's your savings, let's work on your savings. If it's your income that they say is too low. Then let's work on your income. But let's be in the know. Let's start from that awareness.

But some people have been able to get pre approved for more than they needed, but they have been afraid because this whole we got this wave of people who are just focused on perfect credit scores. Right now, the purpose of credit is to be leveraged and to you be used. Some people have better credit scores than me but have no assets. Right, So we're not just trying to create perfect credit scores. We're trying to build wealth,

and not just generational wealth. We're trying to create regenerational wealth. And regenerational wealth is wealth that transcends multiple generations. Generational wealth is passed down one generation. We're seeking to create regenerational wealth and enter into what I call the asset class. Right there's only four classes of people. There's lower class, middle class, upper class, and asset class. And only one of those classes of people is free. It's the asset class.

This is the top line on your sweatshirts. It's the asset class. The asset class. People have passive income that covers their costs of living. Even if I'm in the upper class and I have a good paying job like my mom did. I'm still not free. I'm actually more free than some fortune five hundred CEOs right now, even though I don't make the money that they make, because I own my time, because I have assets that cover my entire cost of living and more so, this is

what the goal is. And so for me, the multifamily movement, it's not just about multi family real estate. That's what I realized recently. It's about multiple families come together to create regenerational wealth and enter the asset class. And the first asset that we're buying together is multi family real estate. But beyond that, I expect to be in these people's lives for the rest of their lives as we continue to create regenerational wealth together.

external condition. It is not who I am. But what happens is when a black boy or black girl is born into poverty, they look around them and they base their identity based on what they see, and they say, I am poor because they see poverty. But that's not the truth of your identity. The truth is that you are abundant, and abundance is your birth right. And the reason that I think we as a collective, most of us, have been born into those conditions is actually to prove

how rich we are. We were born into poverty, approve how rich we are. If I'm Paris Hilton, right, and I'm born into wealth, I can't prove how rich I am because I already had it, it was already handed to me. But if I'm born into poverty, I actually can demonstrate that I am abundant regardless of my external condition. And so this is a mindset. So never say I am poor? Right, I am are the two most powerful words in the English language. Never say I am poor.

You can say I was born into poverty, but that is not who I am. And we've seen all these albums that you see here, people have demonstrated that my external condition does not define me. And we've seen people create abundance out of nothing. And jay Z said, put me anywhere on God's green earth, I trip my worth. That means that regardless of what I have in my pocket and what's around me, I know that the true

wealth is actually inside of me. And so when we start there in the mindset, I believe that it's a more fertile soil for us to actually implant these wealth seeds and these strategies and that they'll take root and they'll they'll grow from there.

me start teaching people how to do this. And so my first student, Chris cosy Row, he actually hands with marketing for a Queen of Fool or whatnot, and he closed on a four plex near usc using NAKA. He closed on a four plex in near usc And that was my first success story outside of myself. And from there I just started teaching it to more and more people. And I just knew that people needed this information in

this education. And while multi family real estate investing it looks similar to single family purchasing on the surface, there's just so many more nuances that you need to know to make sure that you buy right. And so I started the multifamily movement. It was July twenty nineteen, and today we've helped two hundred and sixty one sixty two people. Actually, yeah, somebody just closed yesterday on multi family real estate all

across the country. And the thing about the multi family movement that's different is that I realized that and I think you all say this information is on us, the executions on you. I realized that I'm not actually selling them information. What I'm giving them is an accountability structure and a system to make sure that they implement the information. And so we have market meetups like you talk about with the EYO community. We have market meetups where you're

actually connecting with other members. You have a buddy in the program. We have our weekly coaching calls. It's all about the accountability and the structure to make sure that you implement the information. We know better, but we just don't always do better. We got books on our shows that we intended to read to change some aspect of our lives. The information is there. You wanted to lose weight last year. There's free videos on YouTube. Hit trainings

on YouTube, there's free recipes on Google. The information was there, but there was still something blocking you from actually getting to the finish line. And so I realized that because only seven percent of people complete online courses when left up to their own devices. And so that's what our commitment is, and that's what I'm trying to push on all of us because we are teaching liberation arts education. What was shoved down our throat was liberal arts education.

Liberal arts education will cost you. I don't need to know anything about Shakespeare. I don't care about Shakespeare, right, but liberation arts education will free you. And what we have right now, what's happening, and you are all spearheading this movement is liberation arts education. When people know these things, they can get free.

and science and other stuff. Even in college you still gotta take all the other stuff and be there for four years where it's like you can actually implement this in six months a year, you know, be in a position to actually execute. And it's like mentorship, yeah in a sense right where you're like you're part of a community. You have you know, meetings and online zoom call stuff like that. You know, people always ask like, you know,

can I get mentored? Well, that's kind of like the online communities have turned to the mentorship.

cohorts of people. That's how she freed three hundred people. That's why my first focus is three hundred people. She took cohorts of people. She didn't have time to take one person at the time, right, You had to take groups of people. And so that's what we're able to create. And I think the pandemic actually pushed us online in that way. And when I look at Investmast, when I

look at you all traveling in different cities. We're also making sure that the online is complemented with the offline experience so that people can build real relationship, not just profile pictures, but real relationships. Because we know that collaboration over competition is where it's at.

one hundred units out in Baton Rouge, Louisiana. So yeah, and that comes from the trust of the community, and that comes from working together that what that allows us to do is buy bigger properties at AUNT. It's like, Okay, we're gonna put our money together and we're gonna go to costco. Right, but we're not buying ketchup now, we're

buying real estate at a discount. So that's the power of group economics, like we paid lip service to it, but you know, myself and Anthony Kimball, Chris, we know people have executed the crowdfunding methodology and it's really powerful when done right because everybody can participate at the level that they feel comfortable. Like everybody is a needed thirty thousand dollars down payment. Right, people can say I'm putting in a thousand dollars and it's still going to multiply

it at the same rate. It's just not as much money in. So that's the power of the crowdfunding methodology.

So you guys actually combined forces, yes, right, and you put together a Black Friday deal which was wildly popular, wildly successful. So we're gonna have that same offer for EYL for anybody that's interested in. The website is www dot get four three two one dot com. We'll put the link in the description of this video and audio

and then also on the alumni tab also. So once again, that is actually a combination of MG the Mortgage Guys Volume one, Volume two, home Boys Blueprint, and the multifamily movement community, which, as he said, includes you know, weekly calls and you know, all of the things that you need to get up and running to actually have the confidence, the knowledge, the information and the support to actually, you know, not just purchase one home, but you know, become a.

this is what the collaboration has come to get. Four three two one is how you can get ten doors in four years using FHA several times and running the plays that we tell you to run. If you follow the blueprint, you can't go wrong. And so yeah, we're excited about it. People are already getting wins inside of the program. So we want to take as many people because it's not just about one property. One property should

get you to rent mortgage freedom. But we're trying to get you to full freedom, and you're gonna need multiple doors in order to get there.

The average person doesn't set up structurally or doesn't have the accounting team to ensure that that all gets written off. And so be careful because these platitudes that people put out, if you don't know the back end in terms of how to actually execute it, it may not work for you. Yeah,

it ain't gonna look the same. What I do know is that for multifamily real estate, if you are literally able to get rid of your housing expense for the rest of your life, it will guarantee that you and your family are millionaires.

will ensure that your family become a millionaire. So that's that's been the focus, that's been my lane in this whole revolution. And I know that once people have that particular thing established, then it frees them up to take advantage of all the other opportunities that are available.

over here. Perhaps she's not interested in that, but this can always be managed by a property manager that takes six to ten percent of the rents forever.

can still see that this project, but there's also town homes. Yeah, so yeah, what I found out is that they're actually in the transition I believe, of tearing down the projects and turning them into town and town homes actually look really nice. They look like state of the art. Yeah, they're like really dope. So he was telling me like, yeah, you know, all of these are new, like within the last couple of years. So I say that to say, same story, no matter whether you're in New York.

these are all black owners. And because they decided to plant gardens in the front I think on Macon Street in Brooklyn and best I So because they all decided to plant gardens, they collectedly came together, we're gonna plant gardens. We're gonna all do the facize of our homes. Guess what, they all force appreciation, their equity all went up. But it's a block of all black owners. So they gentrified

their own block. What we've been calling gentrification. That see colonization and colonization is when outsiders come in and try to displace the natives of that neighborhood intentionally. So colonization is it has attended to it, right, has a negative history to it. But that's actually what has been occurring.

When you have people come into the Shaw in DC and you have people complaining about the music that's been played in the Shaw for thirty years, then that's colonization that is seeking to happen because you're trying to displace the culture that is there. So we need to call a spade a spade. If it's colonization, is colonization. But gentrification is actually the uplifting. I want the hood to look better. I don't want the hood to be the

hood forever. I want everybody to have higher quality standard of living. And yes there are some costs associated with that. The rents might actually have to increase for you to live in a decent way, and so we all have to step our game up. But gentrification is not the negative. Thing is the colonization, and we just haven't been calling it.

close on your first property within the next year. They you have, what's your social media handle, It's Julian Gordon j U L L I E N Gordon g O R.

for that. Appreciate it, and thank you guys for rock on you anything you want to say.

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