Episode Transcript
Speaker 0 00:00:00 Welcome to the Investor Agent Podcast, where we are transforming, lack and scarcity mindsets to abundance and wealth, one conversation at a time. I'm Steve Seymour, your host, and I'm here today with Rick Walsh. Rick, thanks for being on today. No problem. So, yeah, I just wanna kick it off. Um, one of the biggest things, uh, most people wanna know is like, how did you get started in real estate? Give a little background, we don't want your whole life story, but just give us a little background about what you were doing, what happened, what shifted, and why real estate?
Speaker 1 00:00:31 Yeah, I mean, absolutely. So, you know, I, like most people, you know, I had a job that I, I wasn't happy with and I wanted more out of my life. I didn't want to have to go sit at a desk every day and, you know, have, you know, to be chained to that office all day, every day. So, I don't know, back in the old days they, Carlton Sheets used to have these late night infomercials and I saw the Carlton Carlton Sheets infomercial, and I was like, wow, you can make money. It's, it's that easy. Buy houses, no money down. That's awesome. So, um, so I bought that course and read through it, and then at the right around the same time, I, uh, read the book, rich Dad, poor Dad, which I know a lot of real estate investors and, and entrepreneurs have read. And I,
Speaker 0 00:01:13 I feel like I've had the same conversation <laugh> with a ton of people.
Speaker 1 00:01:17 Yeah. So, I mean, I really wanted to get involved in, I wanted to get out of my job and, and at the time I thought, wow, I, I'd started doing the math. Wow. If I could get 20 houses and I could make $400 a month from those 20 houses, I could live off of that. So as it turns out, there's no way in the world that you could live off of that, but, but still, so it's the hardest thing was buying that first house. And so I, um, I had a friend who was a landlord and, um, started talking to him about it and he wanted to sell one of his houses. So I bought that house from him, fixed it up, rented it, refied it, got all my money back and I, I thought this is the easiest thing in the world. So then just did it over and over and over and over again.
Speaker 1 00:01:54 Once I got up to about 10 houses, um, I started flipping houses while I still had my job. I was working in the market research industry and um, and I was doing really well flipping houses and I was making more money than I was at my job. And I really, really wanted out. Um, and then I ran into a guy who was a wholesaler who was doing this thing called 1-800-PAY-CASH, which was, they advertised on TV during like, uh, Jerry Springer and stuff and stuff like that, <laugh>. And so I bought into, it was crazy, like at the time I had no money. Like I literally had no savings, I had no money. I had two babies
Speaker 0 00:02:28 Winging
Speaker 1 00:02:28 It. Oh, I was totally winging it. So he's like, look, I'm getting out of it. I'm mo I'm moving to South Carolina. Do you want to take over my territory? And it was, it, and his territory was anywhere in Pennsylvania outside of Philly that still got Philly television stations. So five grand a month. I had no money. I, I, I had a line of credit on my house and uh, I, I just did it, man. I quit my job, my, my, you know, and with my kids babies
Speaker 0 00:02:53 Dove in,
Speaker 1 00:02:53 Dove in, uh, started wholesaling stuff, started flipping stuff, um, kept on buying rentals and then it just kind of snowballed from there. I mean, it was, uh, you know, there's some lean years there, you know, back in like oh eight when the market crashed, but I couldn't be happier, uh, that I did it when
Speaker 0 00:03:12 I did it. Yeah. So let's fast forward a little bit, maybe not to today, but at the peak of your rental portfolio. Cause I know you've sold some off. Uh, how many units did you get up to? We
Speaker 1 00:03:23 Got up to I think 70 units,
Speaker 0 00:03:25 70 rental units. Yeah. And what did, what were the, like, what was it, single family, multi-family,
Speaker 1 00:03:30 Mostly single family in a couple duplexes,
Speaker 0 00:03:33 All in the, in the same market. All
Speaker 1 00:03:35 In Delaware County.
Speaker 0 00:03:35 In Delaware County, yeah.
Speaker 1 00:03:37 All the blue collar towns in Delaware County.
Speaker 0 00:03:40 Yeah. And, uh, so recently you've shifted a little bit, right? Well actually, let me step back cuz along the way you flip properties the entire time building your rental rental portfolio.
Speaker 1 00:03:52 I did, I did. You know, cuz the rentals don't really make money until they're paid off, right? I mean, you
Speaker 0 00:03:56 Get rich slow.
Speaker 1 00:03:57 Yeah. It's gets a, it's an ira. Yeah. Right. So, um, you know, so as much as you think they're gonna cash flow, you know, as soon as one tenant trashes a place, you know, you know, when you need a heater, you need a roof. It's very difficult to cash flow. I mean it's, so, you're right. It's a, it's a get rich slow scheme. So I was flipping houses the whole time.
Speaker 0 00:04:14 So you balanced your active income with flipping passive income with rentals. Yeah, I
Speaker 1 00:04:19 Wealth, yeah. And I think that that's a mix that makes sense. If you want to be a real estate investor, obviously, you know, you know, unless you're doing every repair yourself, it's really difficult to live off your rentals until you get, you know, over a certain point. So yeah. Flipping houses the whole time.
Speaker 0 00:04:35 So one thing people always wanna know, how'd you find the deals? How'd you find anam? Right? How did, how did you get the money for it? Because that's the biggest thing most, most people get stuck on. I don't have the money, I don't have enough.
Speaker 1 00:04:47 Yeah. So in the beginning I had, you know, a line of credit on my house that I would use, I've used credit cards. So, you know, it's that burr method that everybody's talking about. Now you, you buy it with cash and you fix it up, rent it, refinance it, and that's it. And hope to get all your money back. So obviously if you're just gonna put a down payment down it,
Speaker 0 00:05:06 It, and what if you don't have the cash,
Speaker 1 00:05:08 Then you borrow cash from somebody, you know? There
Speaker 0 00:05:10 You go.
Speaker 1 00:05:10 So that's the whole deal. So the whole time,
Speaker 0 00:05:13 The secret sauce,
Speaker 1 00:05:14 The secret sauce is finding private money
Speaker 0 00:05:15 In that Oh
Speaker 1 00:05:16 Pm and believe. And everybody thinks it's so hard to do, it's so easy to do. Everybody wants to get their money out on the street. And so most of the time when I was borrowing money, I was borrowing money at, you know, around 12% interest. I've never gotten a hard money loan from a hard money lender ever. Not once the whole time. And I've flipped probably 200 houses and, you know, have bought, you know, whatever, 70 something rentals
Speaker 0 00:05:38 Over that time. Yeah. Let's, let's talk about that a little bit cuz what, so what's the highest interest rate you ever paid? 12%. Yeah. Yeah. And I think I've paid 15 and everyone's complaining that it's seven right now, right? Yeah. But it's a different type of loan. Well, yeah, you short term bridge loan, you
Speaker 1 00:05:51 Generally, you're only gonna have that loan out for six months, eight months, something like
Speaker 0 00:05:54 That. And if it was a good enough deal, even if you paid 20% interest, would you really care if you made money at the end of the deal? Absolutely
Speaker 1 00:06:00 Not. Right. So everybody's
Speaker 0 00:06:02 Happy. Exactly. So yeah. So that's, that's the biggest thing that I want to make sure that people really get out of this conversation is, you know, yes, you need money to do real estate deals, but it doesn't have to be your own. No,
Speaker 1 00:06:14 No. And it's, it's easy. It's really easy. I mean, it's, if you, if if I could go out and get 5 million right now, if, if I wanted to, you know, it's just about the easiest thing. Now obviously once you've done it for a while, you get a reputation, you know, people, you, you know, you know who to call and all that stuff. But even in the beginning, yeah, like if you, if I were getting started right now and I wanted private money, the first thing I would do is go to regroup meetings. And, and
Speaker 0 00:06:39 A RYA is real estate investor association.
Speaker 1 00:06:41 Yes. And talk to everybody in there if, you know, go to the bar afterwards where the real meeting happens and just network with people as much as you possibly can. Pick up the phone call people have lunch with people and people want their money out. Yep. People, I mean, people would love to get 12% interest on a, on a regular basis. I'll, I'll lend my IRA money out at 12% to other investors. I mean, it's a great deal.
Speaker 0 00:07:01 So are you telling people it's easy to get rich? Yes. Okay. Now what's the hard part of the business? Well,
Speaker 1 00:07:07 The
Speaker 0 00:07:07 Hard part is let's talk about the hard
Speaker 1 00:07:08 Part. The hard part is the day to day. The hard part is getting the stuff done. The hard part is finding contractors that are reliable, that are gonna, that, you know, that will, will show up and, and do the work. The hard part is dealing with inspectors. The hard part is dealing with tenants in particular. That's the very hard part. So aside from, you know, we haven't discussed this, but aside from, you know, the rentals and the flips, you know, probably about five years ago, I, you know, the market was just screaming for so long. I was like, this has gotta end, you know, so, you know, I needed income coming in. I was like, I think I, you know, we're not gonna be able to flip houses. I mean, I, I could have been more wrong. I mean, things have, you know, continued at a, you know, strong pace until just recently. But, you know, I was like, you know, I need more money. So we started a property management company. We started managing properties for other people. We got up to somewhere around 400 units at one point. And it's terrible <laugh> that, that's really terrible. <laugh>. So manag like, you think managing, you know, 50, 70 properties are, are, you know, is bad with the tenants, but managing that many tenants, it's a nightmare. So the management aspect of it, I've, we've recently sold that company, so thank God.
Speaker 0 00:08:04 All right. Without exposing any names or violating any laws, tell us the, the worst of the worst stories that you can just give us one.
Speaker 1 00:08:13 Oh man, I don't even know. It's
Speaker 0 00:08:15 Just like, like, like what was the one that just made you say I'm done?
Speaker 1 00:08:20 Um, honestly, Steve, if, I don't know, it's just a collection of crazies. So we are getting sued for, you know, fair housing stuff that's just a complete lie and, and uh, you know, had a couple fires at the same time. Just like all sorts of
Speaker 0 00:08:32 Problems. So it's more the accumulation of all the little kids.
Speaker 1 00:08:34 It is. And there's always crazies. You know, you get, you get, you evict two crazies, two more crazies come along. I mean, there's just always just dealing with those people. And the owners are difficult too. Right. But the tenants, tenants can be really tough. That's why screening is so, so important. But, um, no, I mean, it, it is simple, but it's not easy, you know?
Speaker 0 00:08:51 Yeah. It's one piece that a lot of people, you know, know, they get so hung up on the money. And that's one of the easiest pieces. It really is. I think the next hardest piece is finding the deals and then the really hard piece is managing them over a long period of time. Yeah. And, and having them perform. Yeah. Right. Yeah. Managing them well. Uh, so with, with your property management company, you said you recently or you're in a process of selling it? Yeah. Okay. And you wouldn't go back into that business again?
Speaker 1 00:09:20 There's no way in the world. I will never manage anybody else's properties. I will never manage my properties. I will never manage a property ever again for the rest of my life. It's not so bad if you have 10 or 20, but once you get beyond that, it's just, it's tough. Yeah.
Speaker 0 00:09:34 So you've, you started out with a corporate job then you, then you started buying Reynolds and flipping. Yep. Then property management business, did you wholesale as well? Yeah, some wholesale,
Speaker 1 00:09:46 Yeah. So back in oh eight when the market crashed, I still probably owned 12 houses that were supposed to be flips. Back then, you just couldn't sell. So, you know, that really dried up. So the only, you know, I, I needed to make money. So wholesaling was it, landlords were still buying. So, you know, I was, you know, wholesaling stuff like crazy I was doing, so you were asking me about getting deals. I've always done direct marketing. That's the way I've gotten the vast majority. I mean, obviously you can go on the auction sites, um, you can look on the mls, which is really, really tough network with wholesalers. I mean, there's a lot of ways to find deals, but I found that direct marketing for me has always been the most effective. Whether it's mailing to absentee owners, um, you know, we used to do post-it notes. We used to kill it with post-it notes. Like back in the old days when a UPS package was at your door and you weren't home, they'd have those little Yeah. Yellow notes when we just had post-it notes, we wanna buy, you know, we wanna buy a house, give us a call. And they worked like a charm. So direct marketing was always the way we did. It's still the, it's still what I do, but I'm doing it a little bit differently.
Speaker 0 00:10:44 Yeah. And your goals have changed, obviously. Oh,
Speaker 1 00:10:47 Yeah. Yeah. I'm looking for, for nice houses and nice neighborhoods
Speaker 0 00:10:50 Now. All right. So out of all these things you've done and all the vast knowledge, how long you've been in this business?
Speaker 1 00:10:54 About 20 years.
Speaker 0 00:10:54 About 20 years. So if you can go back 20 years from now with the same knowledge that you have today, what would you do differently? I
Speaker 1 00:11:02 Would've done a couple things differently. I probably would've thought bigger. I probably would've bought, first of all, I would, I wouldn't, I, you know, I would not have invest in, invested in some of the lower end neighborhoods that I invested in. I think, you know, on paper they look great. Looks like you can cash flow real well, but in reality it's tough. You're evicting people like crazy. You're dealing with really crazy people and that's just not worth it. I would've bought nicer properties. I probably would've started looking at more multi-family. Uh, I probably would've bought more. You know, I, I wish I would've bought more. I would've been in such a great, so much of a better spot. I also, the first several properties I had got, I had 30 year mortgages on, I probably would've gone with twenties to, you know, just accelerate that, that paydown you know, the difference in cash flow isn't that dramatic? That
Speaker 0 00:11:44 It, that it matters. Yeah. Cuz that money seems to evaporate either way.
Speaker 1 00:11:46 Right? It does. It doesn't matter. So,
Speaker 0 00:11:48 And it's just that forced savings and that, that equity paydown would happen quicker. So I heard buy more, buy better. Anything else?
Speaker 1 00:11:58 No, I mean, I, I think that's
Speaker 0 00:12:00 Just buy better real estate and buy as much as you can, right? Yep. And use other people's money. Yep. And you'll be wealthy. That's it.
Speaker 1 00:12:07 There you go. It's, it's that easy.
Speaker 0 00:12:08 The formula to success. You guys all have it now. Now it's up to you. Yep. Um, so what would you say, like, where, where did you get stopped in terms of, cuz I know any time you're trying to get to your next level, you know, from the corporate job to diving in full-time, you had to have had some challenges and internal struggle. And it might take a second to kind of reset back to that, but, you know, I know a lot of our listeners, they want to do this and the pain of staying in their job is probably getting worse and worse, but they're not taking action. So, so what do you think separated that for you, that really had you take that action? And then just any, any words of wisdom to help people get off the couch?
Speaker 1 00:12:49 I mean, I really didn't like my job. I mean, I really just hated being chained to it. And I just wanted to find any way out. And it seemed like the way to do it. I mean, it's a, it's very, very scary, you know, to do that first deal. It really is. But once you get that out of the way, you realize, wow, this really isn't that bad. You know, it's not that difficult to do. And then you get hooked, you know, get hooked. Then you get hooked. Like once you do 2, 3, 4 deals, you just get hooked and you realize, wow, this is simple. Like, I can, I can do this. Yeah. So it's just doing that first one, that's, that's the whole thing. And if you mess up, you mess up.
Speaker 0 00:13:23 Yep. You know, start over, do it again. Exactly. A lot of people spend a ton of money on education that doesn't really provide them any type of financial freedom or cash flow. So if you, if you mess up and lose a bit on a deal, it's your education, right? Yeah,
Speaker 1 00:13:36 Exactly.
Speaker 0 00:13:38 Um, anything else that you just think would be key for people? Like, I'm, I'm huge on taking action and I think you're, I've come out and I spent one day, I was like, Rick, can I just come out and like shadow you and see what you do for a day? And I was like, man, this guy's in a lot of action. What do you think, uh, what do you think people could do to get in action quicker? Because I, to me, this is all about helping them transform their mindset and then take action to give themselves a better life for their themselves and their family. And it's, it's a tough question to ask, but,
Speaker 1 00:14:09 Well, you know what, you know that old saying, you know, you, you be, you become the average of the five people you hang out with the most. And, and so, you know, get out there and network, like, you know, there's so always people that are gonna say, yeah, that's not gonna work. You know, you've got family members saying, oh, that's a really bad idea. You know, I know someone that did that. They lost their shirt. Surround yourself with people that are doing it, surround yourself that are with people that are successful. You know, go to the Rio group meeting, start meeting people that are, that are doing it and at a high level and, you know, it'll rub off on you. I mean, it, it does. I mean, I mean, don't you've had that experience, I'm
Speaker 0 00:14:41 Sure. Yeah. With our network and our, our real estate brokerage, one of our agents, he came to me, he said, this was probably about two years ago when he was starting in this, uh, investing venture. And he said, Steve, I feel like I'm getting peer pressured into success. And it's, it's, it's exactly what you're saying. The the people that you surround yourself really does matter. And that's been a common thing on this show. So if anyone out there needs support in that, you know, we are here to help. And, uh, that really is the vision and mission of this brokerage just to help transform the human mindset and provide a pathway to financial freedom through creating wealth in real estate. Cuz we believe that is the secret sauce. And yes, it's get rich slow, but it's, it's still get rich.
Speaker 1 00:15:21 Yeah, it really is. And it's funny. So when I first met you, I went to, I, I was looking for deals and I really was just like, couldn't find anything. I was getting slow and I went to my title company and I said, you guys know anybody that's doing deals? Like I wanna, I want, you know, anybody. And they said, yeah, this guy Steve Seymour's buying a lot of stuff, you know, maybe you should reach out. So I called Steve and um, we had known each other sort of from growing to meetings and stuff, and then we decided to go have lunch one day and then, um, Steve said, yeah, well I just happened to have this deal in Westchester that's, I think it's kind of fallen apart, but if you want to take a look at it, look at it. So looked at it, bought it, wound up making some money and it was a great deal. And then, you know, Steve and I have kept in touch ever since. And, you know, even, you know, just having lunch every once in a while, we always, I always glean a little something, you know, so
Speaker 0 00:16:02 Yeah. It's great to be with other people that are going through the same type of challenges and struggles and, and also celebrate the wins.
Speaker 1 00:16:09 Yeah, a hundred percent.
Speaker 0 00:16:10 Yeah. It's, it's a lot of fun. I mean we, we, we love real estate. We chose it as our pathway and you might as well make the most of it. But
Speaker 1 00:16:17 Yeah, real estate's one of those funny businesses where it's okay to brag. So like, you know, if you have a job, you know, I, yeah, I got a 2% raise. This is awesome. Yeah. But in real estate, you know, I did this split, but I made like 80 grand. It was awesome. Yeah. You know, it's, it's one of those things where people appreciate it and, you know, it is nice to share the successes, like you said. Yep.
Speaker 0 00:16:33 And with that, there's a lot of challenges. So make sure you have some support around you. People are the best way. If you, if you don't ask, you won't know. So just, I, I know I've learned a ton from Rick and it was just me asking him, Hey, can I take you to lunch? Can I take, come out and see what you're doing? Can I see how you run your flips? Uh, and just a few times. But those, those few times really made a big difference. So I appreciate that because that's helped me along my journey and I appreciate you coming out today. Hopefully this is helpful for you guys. If there's something specific you guys wanna, you know, post or uh, ask, you know, go ahead and post below and we will, uh, do our best to get you the information you need.
