Hello my friends, and welcome to another episode of Passive Real Estate Investing. I’m your host, Marco Santarelli. I’ve got an exciting episode today. Every once in a while I do a client spotlight where I bring one of our clients or investors on the show to just talk about their investing journey and where they started and where they are, and maybe where they’re going to. And it’s always fun to get into everybody’s mind to understand, you know, how they’re thinking and why they got into real estate and what they’re up to and what they were fearful of, and all that kind of stuff. I think for a lot of of our listeners, it’s somewhat inspirational and somewhat motivational. So that’s the reason I like doing it, is because it does actually help some people. And then I also find out that sometimes my guests, when I do a client spotlight, have some takeaways themselves from the questions I’m asking.
So hopefully that’ll happen today, but I have some, not just one guest today. It’s very interesting. I have a trio. I have three brothers. Now, let me tell you how I met these guys. It’s Troy, Kyle, and Dillon. So I was at a Power Room event, one of our Power Room events, and we were at the reception the night before the event started, and I walked in the room. It was literally a barn, literally a barn that we had this event in. And it was probably a mistake in my opinion, but no story for another day. But I was there with my assistant and these three guys come running at me and I’m thinking, oh man, these guys are gonna tackle me or something. I’m for my life. But no, actually, they were waiting for me to walk in because I guess they were clients of Norada Real Estate and they were listening to my podcast and they knew I was gonna be there because they obviously heard me talking about it on the show.
And so these guys approach me and they are okay. I I’m just gonna say they’re, they’re three cute guys. They’re in their late twenties. And they looked just like the Jonas Brothers, and I thought, oh my gosh, we got the Jonas Brothers here. Anyway, they introduced themselves as, as Troy, Kyle, and Dillon. And we got chatting and it was just a great meeting, a great conversation. And these guys are just wonderful. They actually were inspiring me, believe it or not. So I wanted to get ’em on the show, and here they are today.
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So with that, Dillon, Kyle. Troy, welcome to the show.
Thank you, Marco. Marco, thank you, Marco. Very excited to be here.
So this is gonna be very interesting because I’ve never interviewed more than two people at, at the same time. And so when I throw a question out to you guys, I’m not sure who’s gonna answer it, but you guys can all answer it. We’ll see how it goes. Keep you guessing.
We’ll try to be as organized as possible. <Laugh>.
Perfect. Well, hey, so thanks for taking the time to be on the show. I know you guys were looking forward to it. I was looking forward to this very much. And I think you guys are a lot of fun. And actually, I’m, I’m actually impressed with what you’ve accomplished and how you got started. So the best place to start is just to start with you. Let’s, why don’t each of you just take a minute and tell us about yourselves and that way that, you know, our audience knows who we’re talking to.
Sure. I’m the oldest, so I guess I’ll go first, right? So, yeah, Marco. I’m Kyle Buckley. So I do invest with my brothers who are joining us today. I am the oldest of the three. Started my investment journey about three, four years ago. Investing is, I guess, a side hustle or hobby, which I want to make it full-time. I do currently work still my W2 job. I work at Vanguard during the day, and investor by night. So yeah, I’ve been doing finance now for a while. So finance is nothing new to me with being at Vanguard. Started there about five or six years ago, and I work on the operational side of the business. And about two years after being at Vanguard, I discovered real estate investing and began my journey.
Cool. That’s great. Dillon, what about you?
I am Dillon. I’m the second oldest of the, the Buckley brothers. I, I’m just a regular old custodian. I just, you know, I clean, clean the schools during, during the nighttime. It’s a very easy low-key job to help with the, my actual passion for investing and getting into, you know, being independently wealthy. My journey started probably like couple months after my brothers, they actually came to me, they got the bug first. And then they came to me with the idea to all come together cuz who can you trust better than your brothers? You know what I mean?
Right. Good point. Cool. Troy, what about you?
I’m the youngest of the crew. I’m 26. My investment journey probably started right outside of high school. I started a little landscape company that I own and operate today. It’s still pretty small. Sometimes I manage myself, but, you know, I love it. But it’s pretty hard work getting out there in the sun. Pennsylvania is pretty humid and hot and then it’s pretty brutally cold in the winter, so we’re out there in a lot of different temperatures and climates. So, you know, one day my middle brother Dillon called me and, you know, I was like we were talking about investing and whatnot and I think at the time he was kind of had an idea to kind of come in with maybe the landscape business. But I had mentioned, you know, I don’t wanna do this for the rest of my life, <laugh>. So, you know, I really want to get into real estate one day and I’d really like to just earn money passively and just you know, not have to work for money anymore. And here we are now, we all got together one day and decided this is gonna be our dream and, you know, we want to be financially free one day.
Yeah. Great. Great. That’s awesome. Thanks guys. So, Dillon, to some degree in Troy, more so to you, you started answering one of the first questions I wanted to ask the three of you. So maybe just drill down a little bit further into it. I was gonna ask you what got you guys interested in real estate? Now you sort of answered that, but what came before that? I mean, I hear what you’re saying, Troy, about, you know, not wanting to work your same job until you’re whatever, 50, 55, 65. But maybe you guys can break it down a little bit more as far as what got you interested in real estate. Like why not something else? Why not a another business? Why not, you know, just learn to day trade or, or just, you know, ride passively in the stock market? What got you into real estate?
If I may coming up with the upbringing that we, we had, we understood hard work and like the more, the harder the work you or the more work you put in, the more you get out. So we wanted something that we could put our time into, but we could actually get involved in where, like, something in the stock market’s very unpredictable. Like you can have ups and downs with it, but something like real estate, you can have an understanding and you can kind of weave your way through good and bad investments. Where working a nine to five job, it’s just, that’s a unrealistic bet that I’m not willing, that we weren’t willing to take. We knew, we knew the hard work that we were putting in, that there had to be more out than just working to the bone. Like watching our parents just work to the bone to, to come out with basically nothing was, was nothing that we wanted.
So once we eventually knew we wanted more, it was just the idea of finding it. And once real estate kind of presented itself in a way to us which Kyle will probably get more into, cuz he started like, well when he went to his convention, I’ll let him tell his part. That kind of really got the ball rolling in 2019. And as Troy said, like we came to him cuz we had bigger ideas, or I had, we had bigger ideas. That’s why I came to him. But we knew what we were doing at the time was never gonna get us where we wanted to be.
Yeah, I mean, just to piggyback off what Dillon’s saying, you know, we did unfortunately grow up in a less fortunate household Marco. So I think that’s what makes our story so unique. But I would almost venture to say, you know, most people grow up with the knowledge of, Hey, get a good job. Go to, you know, do well in high school, go to college, get a good job make sure you get benefits. You’re 401k, invest in the stock market, retire when you’re 65 and you live the dream. Well, I would say we were almost ignorant to that because we didn’t even hear that growing up. We basicallyi just were told, Hey, work hard, make money and just keep working until you can’t work anymore. So when it came to investing, my brothers and I, you know, at a young age are pretty ignorant to it just because we were never really taught about, you know, your traditional 401k, trad IRAs, the stock market index funds, any, anything of that nature. All that came much later when I started working at Vanguard. So <laugh>, when we stumbled onto real estate, it was almost like, well, we didn’t really know any better <laugh>. We, that was the only investment we knew. And doing research through podcasting yourself, books, self-education we came to find out that we, we kind of hit the jackpot because that’s the best investment you can really make.
Yeah, very well said. Yeah. It’s Troy, do you have something to add to that or?
Yeah, I mean it’s
Funny you had mentioned about the stock market. I did ride the high of the stock market a little bit. I did make some good money at a very young age that kids my age shouldn’t have been making at the time I think I was 24 and it was beautiful. I was riding the high, I think I think in two months I made $10,000, which was amazing. And at the time, you know, working at a job that seemed like a heck of a lot of money. And then it took me all of two weeks to lose $10,000 in a single shot. And at the time we were just buying our first house. So that was a major gut punch to me. And <laugh> like my brother said, Dillon, the stock market is too volatile. I mean, during covid you could have picked almost any stock and it was bound to go up. Yeah. It, it was insane. But <laugh> yeah, when that kind of high just died off and you got sucker punched, I mean, that was a coming to God moment for me. And I knew real estate was what I needed and wanted and that was gonna be more reliable as far as income and wealth.
That big gain in rapid loss is actually a very humbling and great lesson for a lot of people, cuz it does happen to a lot of people. But it’s also a bad thing to actually have a great success your first time out of the gate because then you think you’re like, almighty, you have this, you know, superpower and you think that, yeah, I can keep doing this. And then all of a sudden reality sets in and it’s like, no, this is not consistent.
So I certainly had that in my mind for a bit. I was, I was riding that high and mighty superman complex for a bit. Yeah. So <laugh>. Yeah.
Well, it’s a good lesson and, and you know, it can be very humbling. Yeah. So, you know, you guys got started in your twenties, essentially like your mid twenties, which is a great time to start. Cause most people don’t actually start thinking about their financial future and, and actually doing something about it, let alone thinking about it in their twenties. Often it happens after they have a family and they’re in their thirties and now they’ve got a mortgage and a, and maybe a car loan or you know, whatnot. They have debt, right? And so now, now they’re thinking, oh geez, well I’ve gotta make more money. I’ve gotta service my debts and pay my bills and save something for retirement because I don’t wanna be working my whole life. And if I do, I still need something for retirement. Just quick question, you don’t all have to answer this. How’d you go down the road of real estate? Like, you mentioned a bunch of things, but why did you ultimately pick real estate? What was the light bulb moment for you?
Kyle’s care to answer this one?
Yeah, yeah, sure. I can tackle this one. So to be honest with you Marco, you know, we’re all in the real estate game. We’re all familiar with Robert Kiyosaki, right? I mean, he’s essentially, you know, maybe what kids like to say, the goat of investing, you know, the greatest of all time. So I was on YouTube one day just kind of surfing through YouTube, came across one of his videos. And through the video I came to find out that they were doing through his Rich Dad education company, a local seminar. I live in King of Prussia, Pennsylvania. They were doing a seminar not far from my home. And I don’t know what drove me to want to go, but I was just like, Hey, why not check it out? It’s not an interesting, it was all about real estate.
So I headed there and it was free. And I learned some, you know, good information, a lot of things I didn’t know about. Real estate was really blowing my mind. So they offered basically like a three day workshop. About a month later it was $500 and you were allowed to bring somebody with you and basically just educating you about real estate and all the different types of creative financing and everything that comes with real estate burn investing and all that good stuff. So I attended and I took my brother Troy. I was like, Hey man, you know, I think this is a great opportunity for us. I just paid 500 bucks. I can bring some buddy with me. I would love to bring you and, you know, let’s go learn something. Let’s do this. You know. And of course my brothers and I think naturally just have that entrepreneurial spirit.
So he, he jumped at it. So he came down for the weekend. We spent the weekend together, he stayed at my place and we went to the event together. And gotta say, that event really opened our eyes to what’s possible. You know, I think you, most people have this closed mindset of like, well, you know, that’s great that those people can invest in real estate and those people can make it successful and wealthy, but that’s just not me. It’s just, it’s not in the cards for me. This event like, lit a fire under us. Like, you know what? We can be that guy up on stage. We can make this happen. It’s just a matter of how, how can I make this happen? And learning all the creative techniques that go into real estate investing, it’s not going into a house, building it from the ground up and swinging a hammer, just like, you know, all these TV shows like, to tell you, it’s, it’s so much more than that.
So after that weekend, Marco, we hit the ground running, it was just like, okay, great. Now how do we do this? So shortly after I discovered your podcast and your podcast has been wonderful, you know, it’s been great. I’ve, I’ve listened to every single episode you’ve had on there. Every, I was treating every episode as if I was in class learning, taking notes and everything and relaying it to my brothers. And you know, it wasn’t long before they started listening to your podcast and I have a lot of other friends at Vanguard who listened to your podcast cuz of me. So we loved it. That was great. Yeah, I mean, you’re just a wealth, a wealth of knowledge. And through that reading books, we read all of Robert Kiyosaki’s line of books, you know, Tim Ferris and Napoleon Hill. I mean, I could go on and on. And just basically educated ourselves after that seminar for 18 months and saved and saved until we finally pulled the trigger and bought our first property. And now today we have after that, that was about three years ago, and now we have, we had four, we just sold once and now we’re down to three properties.
Congratulations. That’s great. That’s averaging a little over one a year. Yeah, yeah. Curiosity. Why’d you, I didn’t know you sold one. Why’d you sell one?
So we had a commercial property and so the pretty much the plan was to, to buy it and resell it, you know, to make money off of it. So that was the plan from the gate. We never planned on actually doing a buy and hold. We bought it, flipped it, and sold it.
It was our first commercial property.
It was our first commercial property. Yeah.
And so the other three are residential. Yeah. You’ve got tenants and yeah. Okay. Very cool. So clearly it sounds like you guys caught the bug and I mean, you essentially self-motivated yourself. You, you realized that there’s a lot there and there’s a lot you can do. You can become financially independent. You learned a lot from, you know, that seminar and then you continue to educate yourself. So that, that’s great. Sounds like you guys are self-motivated people. I, I like to ask people sometimes how do you keep yourself motivated? And, you know, people answer that question differently, but do you guys find you need to keep motivating yourself in different ways? Or are you just excited about it enough that you just sustain that motivation?
I would say to answer that question, I think you always need to reaffirm yourself especially when you have something like this going on, right? You know, it’s exciting, it’s new, but your circumstances always change and you always come up with new problems and ways to solve those problems. And though can make it exciting, it can also make it very frustrating and kind of a deterrent. But you always gotta remember your end goal of, and going back to the why of why I started this, why I want to get to that position that I want to be in and on that level Yeah. Of where I want to go. So, you know, it’s always a battle and with anything, but I would say yeah, just stick with it, you know, and keep getting motivated.
Yeah. You said something very, very intelligent. It’s, it’s starting with why, you know, you have to know the why because the, the real estate is just the vehicle. It’s, it’s the tool in the vehicle that gets you there. You know, so your why is time freedom and or financial freedom real estate can help get you there. It, it’s a very powerful tool to do that and it’s historically proven. So yeah, it’s a very good comment that you made about thinking about the why, and I’m sure your why’s are probably similar but maybe different, you know, y’all have families.
I have one on the way, actually, my first one I have a little girl on the wife.
Congratulations. Thank you. Thank you. Yeah. Very cool. So what are your long-term goals then? I mean, we’re talking about goals in a sense. Do you guys have long-term goals? Do you even write goals? I mean, do you make goals?
We have we have like, we conference call with each other all the time. And in the beginning of the year we do yearly goals. And then we have our quarterly goals that we follow. And then we have like our story or our, our mission goals, like our boards at home that we have. Well anyway, I know that’s just stuff that we have going on, but I mean, I feel like we make short-term goals all the time and we have long-term goals. My personal long-term goal is to never have to do something again. In simple terms. Like, you know, I never want to have to go to work. I never want to have to do something in, in spite of not doing something else. Like, I wanna be able to live my life. I wanna be able to wake up every day in the stuff that I have planned out for myself and stuff I want to do, not stuff I have to do to do other things that I want to do.
And that’s freedom.
Yeah, I mean, as far as our long-term goals at at least what I envision we don’t, at least, I don’t ever wanna stop earning money, growing my net worth and, and my wealth, you know I’m very high reaching in that sense. You know, you picture the big house and the, the cars and you know, maybe the planes one day that we could have or something. But the ultimate goal is, is freedom. Of course. Nothing topples that. Right. You know, we’re not becoming wealthy to become rich, we’re becoming wealthy to become free. But you know, definitely we never wanna stop growing our wealth and growing our opportunities.
Yeah, I mean, I would just piggyback off what my brother said. I mean, the goal, you know, when we started this Marco, back when even before we purchased our first property, it was always time freedom. You know, we just want the ability to have our own schedule, not forced to go into work and feel like we’re forced to go make money. I mean, it all goes back to our why. I mean, like I said I would say the foundation of our investing really comes from our upbringing. You know, we did come from, you know, an unfortunate upbringing that when we do have our own families, like DI’s having his first baby girl and I’m married, so recently married for about a year and a half. So it’s not long before my wife and I decide to have our own family and start our own family.
And we just want to provide those better opportunities for our children. And we wanna be in their life, you know? We don’t want to be away working 10, 12 hour days and pawning our kids off on you know, a babysitter or something because we gotta go put in the hours to make the money to put food on the table. We’re trying to avoid that, you know, get out of the rat race. I know it’s cliche I guess, but you know that yeah. That that’s what burns our fire. And we hold ourselves accountable. We have monthly meetings with my brothers and I, every month we discuss, okay, what did we do well this month? What can we work on? And we take that through all the way through the end of the year. And we set goals, like Dale said, at the beginning of the year and at the end of the year, we reevaluate did we meet those goals?
How could we have done better? And we’ve always kind of ran our real estate investing as a business. And I, you know, I’ve always told my brothers like, guys, if we’re gonna do this, we’re gonna take it seriously and we’re gonna run it like a business. This isn’t just a hobby, even though it is our side business. If we want this to be our full-time business, we gotta treat it as such. So, yeah, I mean, when it comes to motivation, I mean there’s no lackluster motivation within us. I mean, we’re, we’re on a call every month and holding ourselves accountable and just keep going through it. I mean, we are just keep chucking away until we do meet our goals and get to where we want to get to.
Yeah.
It’s nice. It’s nice keeping all that we keep all of each other accountable. Sorry, I’m not to cut you off, Marco.
Yeah, no, no, you’re fine. You said some really good things there, Kyle. One thing that really stuck out is the fact that you guys actually have goals. Cuz a lot of people, you know, wing it, they just don’t have goals. They might have a goal in their mind, but they don’t write it down. Second is the fact that you talk about it and you meet every month to discuss your goals and where you’re at and where you’re going means that you are measuring things. And there’s a concept in management called, well, there’s no name for it, but it’s a concept that basically says that you can’t manage what you don’t measure. So the fact that you have metrics attached to what you’re doing, how many properties, maybe how much cash flow you’re making, you know how much you wanna make this year, or how many properties you wanna acquire this year, that kind of stuff.
The fact that you are, how much have you saved? How much do you need for down payment? Anything like that. If you’ve got those metrics and you’re, you’re watching them or monitoring them, that means that you’re essentially managing them and you’re going to achieve your goals because you know where you are at any given point in time and it just leads to more success. And you said something else. I’m trying to remember what it was. Something else that was kind of a great kind of an education point for, for people. It’ll come back to me. Okay. Unless you, you don’t wanna…
<Laugh> I mean, holding ourselves accountable, I think that’s huge. You know, and I think it’s so easy, especially just when you taste that little bit of success. You know, we were so excited when we purchased our first property and it’s kind of easy, you know, once you taste that success, like almost to get comfortable and lose sight. Yeah. And that’s one thing, having those monthly meetings and just holding each other accountable. I can honestly say my brothers and I never lacked on, I’ve seen it happen with business owners and I’m just like, that’s not gonna be us.
Yeah. It’s actually two things that you mentioned. The accountability is one. The other part of it is having a vision. I mean, you guys have said multiple things about where you see yourself not, where you’re not focused on where you were as much as where you are now, as much as where you want to be. Like you have a vision. And that’s not the same thing as a goal. A vision is the kind of the, a colorful, vivid, big picture of what you see in your future, but it’s the goals that break it down into actionable steps that get you there. And, and it looks like, and sounds like you guys are doing both. And, and that’s why you’re having the traction that you have and the success you’re having. And I, I think the more people that do that, well, I don’t think this, I know this.
The more people that actually do that, the faster they get to where they want to get to. And that’s ultimately their target, their goal. So let’s get a little more tactical here. You clearly chose a strategy. It’s to buy and hold, you know, you’re investing, holding a portfolio of properties. You could have done all other things like buy fixing and flip properties. You could have done wholesaling. It doesn’t sound like you’re doing any of that. Tell, correct me if I’m wrong, but did you think about doing other things in, in the real estate space or were you just hyper-focused on that buy and hold strategy?
We, we looked at all the avenues. Like we, we did research for 18 months on the different strategies of real estate. We, we learned on, like we did looked at lease options. We were looking at that for a little bit. Like we all kind of broke off and did different research, came back together and talked about it. And the, the way we came up was the best option. Going with Narada was our best option, especially in the beginning. It was very much like, it’s, it’s built for people who are just getting started. Cuz you guys kind of not hold your hand, but have an assistant there with you the whole time and it gives you the chance to get your feet wet with options that are very lucrative for the person looking.
Yeah.
Yeah. our main thing was and the reason why we buy and hold too is necessarily necessarily to help our net worth essentially. A lot of people when they look at real estate, they only look at the passive income. You know, that’s the main thing that people look at that I’ve found. You know, when I’m talking to friends or I’m, I’m kind of coaching them on, you know, my brother and i’s story, you know, they always look at what they make at the end of the month and you know, it, it’s insane the way I have to break them down essentially and say, you know, that’s, that’s one small part about real estate mm-hmm. <Affirmative>. and the beauty about real estate is, is how wealthy it can make you over time. It’s just, it’s a long game. Mm-Hmm. <affirmative> and buy and holds a long game.
It’s a long strategy. But the main thing about real estate is, is the appreciation value that you get out of a home. And that’s what was really attractive to us because, you know, just in the two years that we’ve owned our first property, I mean, <laugh>, it, it’s grown in value exponentially and just two years. And in fact, it’s made us more money than what the passive income on those properties has made us. Mm-Hmm. <Affirmative>, you know, and we bought it at actually a top dollar rate you know, a turnkey property. So we paid the full value for it of the, at the time and it’s grown exponentially. And then when we got into two or three or four more properties, you know, now we have three properties that are doing that all at the same time. So that snowball effect is just insane. And that’s, that’s essentially why we love the buy and hold strategy.
Yep. That’s great. What if you had six, what if you had nine?
What if I had 600 <laugh>? I mean, yeah…
There is no limit to how many you can have, but that compounding effect, you know, gets really exciting when you start to have, you know, more than 10, you know, 15, 20 properties that are all growing in value over time. The equities growing in all those properties, which is increasing your net worth, and then the cash flows are increasing as well. And then, you know, there’s more advanced strategies, you know, that you have to make a decision, do I pay off all the mortgages? Do I accelerate the mortgages and pay them off and increase my monthly cash flow, which is your spendable income. You know, you live off of it. You, you travel, you do whatever you want to do, or you just keep acquiring more properties and keep financing them. You still add your cash flow, you still grow your equity, you know, through appreciation and amortization, but you’re just continuing to grow your portfolio.
I’m getting ahead of myself, but there’s a lot of, you know, of options with real estate, but you’re seeing, you know, the effects of it and your comment about the cash flow being what it is, but the equity growth being that much more, that’s where wealth is created in real estate. You know, the, the cash flow’s great, but the cash flow’s not gonna make you rich. What’s gonna make you rich is having a lot of property, acquiring as much as you can holding them for the long term and watching that equity grow at three to six times the amount or more over time than what you’re gonna get from cash flows from the property. So, you know, there’s different ways to make money on real estate. Those are the different legs of the stool, if you will. And, and I talked about this in one of my episodes, I think it was episode 2 99 the real, the real rates of return of real estate investing, something like that.
I mapped it all out in a spreadsheet and then I showed, you know, just with some very basic assumptions, how much you’re gonna make each and every year off of that property in terms of cash flow and compared that to the equity growth from the loan being paid down, the amortization and the appreciation from that property using I think 4% as a long-term average. And the appreciation and the equity gains from the amortization outstrip the cash flow. I mean, the cash flow’s nice. You want it, I call it glue. It’s a glue that holds your deal together and down the road. Ultimately that cash flow’s gonna go into your pocket and it’s now real spendable cash that you can service your lifestyle, whatever that may be. You know, if you have a $50,000 or $500,000 lifestyle, well you could, you know, build up to that with your real estate. So I’m glad you saw that early on because those are the benefits. And the one thing you didn’t mention are the tax benefits, which is, you know, fantastic. And I’m sure you’re, you’re dialed into that as well, right?
Yeah, depreciation. Absolutely.
That’s why when you made that’s all. Yeah. You said something about paying your house off. I was like maybe not <laugh>, but yeah, <laugh>,
Yeah. There’s an advantage to not paying it off, you know, and plus no, no, anybody who, you know, being extreme here, but anybody who wants to sue you and knows that you own property, when they come to find out that the property is leveraged, you know, doesn’t have a lot of equity because you’ve got a mortgage on it, it becomes much less attractive to someone who actually wants to sue you for whatever reason, you know, for damages or injury or whatever the case may be. So in a very strange way, it’s kind of a form of asset protection. <Laugh>.
So let’s talk about markets. Let’s get a little tactical here. As you all know, you know, markets are very important and investors sometimes or often don’t really know where to start. They just assume that they have to invest in their backyard, which, if you’re lucky enough to be in a market that makes sense, great, you know, that’s where you can start. But where did you guys start? What, what, how did you choose the market that you started investing in?
Well, I’ll say Marco. We were never afraid to venture outside of our backyard. I know a lot of people, and understandably so, would maybe be nervous to, oh man, I live in Pennsylvania, I have to invest in Pennsylvania. My brothers and I, we had no fear. We had done enough research that we were comfortable and we kind of, you know, we went about, it created a criteria based on how much money we had saved up and how much money we had for a down payment, and then the fees that come along with purchasing a property. So we built out a criteria. We knew we wanted to invest in the southeast, we liked the numbers that came along with that. We knew we were gonna avoid all the coastal markets because we were not interested in cyclical markets at all. Only linear markets.
And at the time, we we were paying very close attention to the cash flow as well. So we were looking for a property that would cash flow something decent. You know, it didn’t necessarily have to be a hybrid market. We were kind of, were leaning more towards that cash flow market. And based on the the amount of money we had saved, we were looking in that 80 to $110,000 range for our first property. And then Melissa was great. I mean, Melissa, you know, we told her our criteria, we broke things down for her. She’s like, great, this is what I have. And it turned out that actually our first property was right in our backyard, even though it didn’t have to be <laugh>. So we ended up purchasing our first property right, in Pennsylvania. And we just thought that was hilarious.
So but yeah, we, we created a criteria. Melissa was so instrumental in helping us even dig in a little bit more, adding in a little bit detail, a little bit more detail there. And she’s like, well, hey, this is what I have in the pipeline. I think it fits your criteria. And it was right here in Chambersburg, Pennsylvania, I think two hours away from me and about an hour away from Troy. So if we did want to drive by and look at the property, we could, even though we never do <laugh> <laugh>. But but yeah, so that, that’s how we came to as far as what markets we were looking in. So we were looking at Alabama, Mississippi, Baltimore, I’m trying to think where else we looked in Tennessee. Most of it came down to the price of the property. And then we kind of worked backwards from there, but we ended up obviously in Pennsylvania.
I was gonna ask you the question of what was your criteria, cuz you mentioned it a few times. You, it sounded like you had a criteria at the time, but if I, if I had to guess I’d say that down payment, like purchase price was one of your main criteria at the time.
Absolutely, Marco. So we kind of worked backwards from that, so purchase price for sure. Cause we had about $30,000, so that needed to cover our down payment plus any additional fees. Yeah. And we knew we wanted a B class neighborhood. We weren’t interested in anything less than that. You know, stay out of the war zone neighborhoods and all that good stuff. And we wanted a linear market, you know, b class, linear, blue collar, you know, working class neighborhood. And and then, yeah, obviously, like I said, the purchase pri price played a huge role in that. And then we were looking at our real returns in terms of cash flow. So, you know, what could we look at to get, you know, if we buy a hundred thousand dollars property with 20% down and we, and the 1% RV ratio, we took that a hundred percent into consideration as well when purchasing a property.
Although that’s much harder to find today in many markets.
Yes, it is. Yeah. Things have changed a lot. Well,
You just have to, you have to adjust as market conditions change. So today, you know, if you find something that’s around 0.8% with a, you know, rent to price for rent value ratio, that’s actually pretty good. You know, or you just have to keep looking for smaller markets or go further out or maybe kind of downgrade your neighborhood criteria a little bit, which is usually the thing I, I don’t recommend people do just to get a higher RV ratio. I’d rather them you know, have a smaller cap rate, smaller cash on cash return, le little bit less cash flow, but stick to a, a highly desirable neighborhood that’s gonna be solid going forward. Because long term it’s gonna prove to be much better for you. Less headache, less maintenance, and stronger appreciation potential. So I put a lot of weight in neighborhoods, you know, to some degree even more so than the market itself. So, good for you guys. So let’s talk about your journey and then we can start to, you know, wind things down here. I think investing is a journey for most people. And the idea is that it can take you from financial frustration to financial freedom. I mentioned frustration. What was, if you had the biggest frustration before you guys got started investing?
I mean, I would say, I would say the most frustrating thing is, is saving the money. Cuz it’s like you have, you have a plan. Yeah. And you have a vision, which my brothers and I did not lack in either of those departments and we’re all hard workers. So we were working really hard, putting in extra hours to save up the money for the down payment. But saving that money for the down payment, I say, I would say is what the most frustrating part was cuz it’s just like, okay, I want this property now, I want it now. But you’re just like, okay, let’s be patient, you know, let’s work hard, let’s save the money and then we’ll have the property. I actually, we actually have some interesting stories of frustrations that we had while we were investing too. If you wanna get a little bit into that. Yeah,
Sure. Share one or two of ’em. Cause this is, this is something that invest, you know, people listening to this might think, oh, well what was that? Maybe I need to know about it, you know, in order to prevent it or, or deal with it if it comes up.
Absolutely. And I would say this is a huge lesson for you know, future investors listening to this. And it was a lesson for my brothers and I, so it was kind of, this was kind of one of those things, this would never happen to me, but unfortunately when we purchased our second property, it was purchased in a good neighborhood. It was just one of those freak unfortunate things. There was a shooting at our house, the it wasn’t at our house, but the bullet came through our front door and hit the toilet. No one was hurt, thank gosh. But it was just one of those things it just a freak thing that would never happen in that neighborhood. But it did. And the tenant was safe. Everyone was okay. But it was a big lesson for my brothers and I cuz we were like, oh my gosh, we didn’t, you know, cuz this was in Memphis, Tennessee, this wasn’t in Pennsylvania when we purchased our second property and we’re like, oh my gosh, like, you know, I can’t believe this happened.
And you know, did we purchase a property in the wrong neighborhood? But come to find out, it was just one of those freak things. But I will say the provider who we had asked us like, Hey, if you want, I can sell this property for you if you feel like it’s cursed or whatever. Since this happened, I can honestly say my brothers and I, we didn’t even bat an eye. We were like, no, we want this property. You know, we, we believe in this property where, and this is going backward, backwards for us if we sold it. So I would say for the listeners, you know, these things happen in real estate, they happen in business and it’s unfortunate, but I would say be persistent, have grit, have thick skin, believe in what you’re doing. And I would say Marco is as funny as it is that that happened.
The tenant did move out, unfortunately, but the new tenant that moved in, we actually ended up getting a premium rent making extra a hundred dollars a month. And we have ’em leased up for two years. So as crazy as that is, you know, it’s like, oh my gosh, this horrible thing happened. It actually turned out to be a blessing, as strange as that sounds. But I, I would just tell your listeners, you know, anyone who maybe if they have a freak thing like that happened to ’em, they’re like, oh my gosh, real estate just isn’t for me. I would say, you know think again, you know, take a breath. These things do happen, but it will get better and everything happens for a reason. You know, just have that thick skin, that grit. You know, we didn’t even bat an eye. We, we purchased that property and we, our third property was purchased right in Memphis couple streets down the road. And it’s, it, it’s been great. I mean, the, you know, this is real estate and you do hear about these freak things happening, you know, you think in the back of your head, it’ll never happen to me. But it did. But, you know, my brothers and I, like I said, we have that vision, we have that goal, and nothing’s gonna stop us.
That’s awesome. Well, I’ve been doing this for over 19 years and I’ve never heard that story before. I never heard a story like that before.
<Laugh> so has happened.
To the Jonas brothers, right?
If anybody, it happens to us. <Laugh>.
But that, that does sound like a very random freak thing happening because it, it, it sounds like it had nothing to do with your property or the, the person living the greater the neighborhood.
Correct. Hit our criteria. There was no reason for a shooting in the area. So yeah, it was just one of those freak things.
Yeah. Yeah. Definitely random. Definitely random. Yeah. Yeah. So, sorry, did you wanna add something there?
I didn’t. No, I’m good.
Okay. So we have both new investors and seasoned investors listening here. What advice do you have for new investors listening to this that are either just getting started like you guys did or are already just starting to go down that path. They’re maybe looking at their first property or just bought their first property. What, what kind of advice would you give to these new investors.
Failure is failure’s never a problem. You just learn from failure. So failure’s not a bad thing. It’s a nice learning lesson. So if you mess up, you make a mistake. It’s not something to like throw in the towel and quit. Like, it’s just, it’s, it’s something you have to learn from and move on from
The best advice I could possibly give is partner up. That is crucial. Investing is not something that you could just easily achieve on your own. It’s possible, but it is better with other people. You can, you know, pull each other’s resources your time, which is huge. Your money, you know, and just everybody knows somebody, right? I mean, when you have partners, they know people, they can set you up with a new network of people that they can pull from. So partnering up is, I would say the most crucial part of this. And I’m fortunate enough that, you know, my two partners I grew up with my entire life, you know, they’re my brothers. They’re two handsome guys. They’re well spoken and you know, we have a great relationship. Not everybody has that fortunate, maybe they hate their brothers or, you know, maybe they don’t have brothers, but right. There’s someone out there for everybody. You know you can find a partner. No, no matter what, lots of friends partner up and lots of other colleagues that they meet, you know, just at a, an event or something. And they make great lifelong partners. Learn to trust people do, do due diligence and you’re gonna be just fine.
Absolut, absolutely. Yeah, I mean, just to piggyback off what both of you guys said I would just put it really simplistically as persistence, guys, you know there’s gonna be bumps in the road, nothing’s perfect, but just keep, keep going. Be persistent. Get, get through the rough times because there’s greater times ahead and you will be successful in this.
Yeah, those are all great pieces of advice. Troy, if I could just add one thing to what you said about partnering, that is great advice for some new investors that don’t have a lot of investible capital and can’t save investible capital fast enough to really get down payment that they need. And that’s when partnering with, you know, one or two other people that you know, and trust, especially trust comes in handy because you can get on that equity train, you can get into the real estate game sooner by having one or two trustworthy partners to get in the space and start investing then just to wait, you know, whatever, a year or two, maybe three years before you save the down payment that you need. So, so I I I like all of your guys’ tips and advice. Now, if I was to ask you the same question about someone who’s seasoned, you know, that doesn’t, you know, they’ve kind of gone past that stage about partnering or, you know, trust or, or just, you know, whatever it may be. What, what advice, if any, would you give a seasoned investor looking to grow today?
If I had to say the best advice I could give to somebody like that is definitely delaying your gratifications at all costs. You know, a lot of people get into wanting to be wealthy because they want to be rich and they want the fast cars and, and the boats and the yachts and, you know, the nice apartments and everything. And that’ll all come in time. You know, that’s inevitable. If you have the right mindset, you know, we’re not there yet, but there are things that we could purchase that we certainly do not because we know we can’t, because just taking a couple hundred dollars away from our investible income is catastrophic years down the road, you know, to our ultimate goal and our investment portfolio, you have to look at every dollar as you know, how much can this $1 make me? You can put it into a real estate property and it’s earning you anywhere between 20 to 30 to 35% on the dollar.
So it’s, it can be catastrophic if you don’t learn how to delay gratification and learn to live within your means. I mean, there are several millionaires that I’ve heard their stories that, you know, they’re millionaires. I mean, grant Cardone, for instance, has talked about he was worth multi-millions of dollars and he was still driving a Camry. Mm-Hmm. <Affirmative>, you know, I just think that’s a very humbling story of wow. And now he’s got like two jets, two helicopters and multiple mansions and has a great lifestyle. Mm-Hmm. <affirmative>, but he learned to delay his, his wants over his needs.
Yeah. So a lot of truth in that for sure. Kyle Dillon, did you want to add to that?
No, that was, that was a good for me. I, I couldn’t say anything better.
Yeah. Yeah. I was gonna say, I mean, I couldn’t have said it any better myself. I mean you know, just to touch on the point about, you know, every dollar that you take away from your investible income is catastrophic. I mean, it isn’t real estate because every dollar that you have is worth five times in, in real estate. You know? Yeah. If I got a a hundred grand that could potentially get me what, three, four, maybe five real estate investment properties as opposed to going and buying, you know, a fancy fast car. So yeah, delayed gratification is wonderful. I mean, I had a nice car before we started investing in real estate. I had a Dodge Challenger and I sold the Challenger and then took all the money I had and <laugh> totally. I bought a, bought an investment property, <laugh>. Now my wife and I, we share her Ford Escape suv and we get along great with that. I didn’t need the challenger, so Yes, delayed gratification for sure. Love it. Yeah,
I agree. I drove my previous car for I think 16 years. <Laugh>
My car’s been paid off for like three years. That thing is, that thing’s almost as old as me. 2000, no, I guess not. It was almost 2008. The thing’s almost 20 years old.
Yeah. Yeah. There’s a lot of truth in that. Yeah. So it said, it said that experience is really one of the greatest teachers and you actually gain a lot of wisdom from, you know, your experiences and especially when you compare that to just basic knowledge that you ultimately get from, you know, school and education and whatnot. So there’s a lot to be said from an experience. So looking back at your experience, what would you have done differently?
Started sooner, <laugh>. Yeah.
Yep. I wish I would’ve started when I was 18, mark. I could’ve. Yeah.
Yeah. I would, I would’ve started invested at 10 <laugh> take, I would’ve taken my lunch money put into a piggy bank and put into a house fund. Yeah.
Yeah. It’s funny, looking at all three of you, all three of you started nodding as, as Dillon was saying, started sooner, you know? Great. So you would’ve started sooner. Anything else you would’ve done differently or is that, I mean, that’s obviously the big one.
I mean, strategies always changed, right? I mean, when we were first getting into this, we all got together and we were like, what is our income? What do we want our income to be when we fully retire? Yeah. You know, and it’s, at the time it was like, you know, 5,000 a month, 10,000 a month, you know, and though that’s still our goal to kind of, when we get to that point of making 10,000, we’re gonna stop, not stop investing, but we’re gonna stop working.
Yeah. We’re gonna gonna stop our W2 jobs. Yeah.
Yes. And it, I think initially we’re like, you know, as soon as we make $10,000 a month, we’re happy. We could just live our lives. And as we started investing, we realized, my god that’s not that much money. You know, 10,000 isn’t that much. And we’re like, you know, what if we just don’t stop? What if we keep doing this? And our strategy just kept changing and it to this day keeps changing. And, you know, Marco, you’ve been doing this for, what, 19 years, and I’m sure you know, your strategies have changed. Your goals have changed. And <laugh>
Well, my my strategy, I I, I think what you’re really saying is your goals are changing, not so much your strategy, your strategy still to invest in, in income producing real estate, buy and hold for the long term. That strategy’s not changing. It’s your goals that are changing, you’re upping whatever that target is and maybe expanding your, you know, your view and vision about it. Right. But I, you know, I, I hear what you’re saying there, there was a time years ago where everybody wanted to be a millionaire and they still kicked the term around, you know, I want to be a millionaire. Right? Because like a million’s a big deal. But if you really start to think about it, millionaire status today is just really the new middle class. If you’re, if you’re not a millionaire today, you’re not middle class anymore, you’re, you’re lower middle income or even worse. So this is just reframing what we thought was like the place you want to be, and that is a millionaire. No. If you don’t have five to 10 million by the time you want to get to your retirement, whatever retirement is for you, you are gonna keep working <laugh> or you’re gonna rely on somebody or maybe the government who knows what.
It’s, but it’s crazy to think like people, cause I mean, we all still rent, like none of us own, our own home that we live in. I still rent my, my apartment out. But it’s funny, like when you talk to people who still have that single mindset million dollars, it’s still nice to them when you’re pinching pennies together. So, and I’ve seen a lot, and a lot of companies that I work for, I see them kind of wave that retirement in your face. Like, Hey, you’re gonna have a million dollars in your retirement, but if you don’t have, like you said, at least 5 million in the bank in accruing interest, there’s, you can’t live off that. It’s just, yeah,
It’s awful. Yeah. Kyle, I saw you nodding and I saw the gears turning in your head. I, I know you wanted to say something.
Yeah, so I, if I could just segue back, Marco, if there’s one thing to your original question about, there’s one thing we could change, there is another thing besides, you know, just changing when we would start investing, but I would also join a mastermind group way sooner. Coming to the Power Room, that event was just, it was amazing. The people we met, the connections, the networking, the, the event itself. I mean, getting to be your guest was an honor, by the way, can’t thank you enough for allowing us to come on your behalf. So that was amazing. But joining a mastermind, I would tell everybody, you know, you hear people talk about it all the time, but until you really do it, you just have to experience it because the, the amount of knowledge, the wealth of knowledge that you can acquire attending one of these events and the networking and the people you get to meet, you know, the, the like-mindedness.
I mean, it’s kind of takes me back to my point about what we thought was possible when we attended that first real estate seminar. Well, man, when we attended the Power Room, what we thought was possible now is like, sky’s the limit. I just feel like we, there’s nothing we can’t do. So it was just so powerful being there. So that’s something I definitely would say. I would’ve changed a lot sooner. I would’ve, I would’ve went to Power Room, you know, when it first started, if it was possible. So yes, I will, I will definitely throw that out there as well.
Yeah, I appreciate you saying all that. And, and by the way, for everybody listening to this, they did not pay and say any of that <laugh> <laugh>.
He did not, Marco did not say, not pay us to say any of that <laugh>
Completely unsolicited and unexpected. So, but thank you. But yeah, everything you said is true. I mean, until you’re actually in a room of high achievers, successful people, like-minded people, you’re forced to stretch your imagination, your vision, your, you know, your, your beliefs about what is possible. Cuz you, you realize that there are people around you doing five, 10 times, 20 times what you thought is possible or are doing yourself. So, and it’s very motivational and inspirational and educational. So for sure. Definitely.
Yeah. Just, yeah, just good stuff. Amazing. I would definitely recommend, you know, join a mastermind, guys, <laugh>. Yeah. Come to come, come to Power room
<Laugh>. Yeah. Yeah. Appreciate that. So, last question, and we’re gonna wrap it up here. So 20 years from now, if we fast forward 20 years and if you were able to come back and give yourself some advice, what would that be? And you can’t say start sooner. Cause you already said that.
<Laugh> <laugh>. Oh man. 20 years from now, if I could come back, give myself some advice,
Talk to your, talk to yourself.
I feel like the one everyone goes with is enjoy the moment. So enjoy the ride. So I gotta, I, I’d probably say to stay in the moment and not think so far into the future. Yeah,
Yeah. I mean that’s, that, that is, go ahead, joy. Sorry.
Yeah, I I would have to say maybe take more chances, especially if you’re young like us out there, you know, for your young viewers. Don’t be afraid, man. I mean, I’m 26 you know, we’re, our generation’s probably not gonna be able to retire, so why not just say, screw it, take the chance, you know, walk into your job and give your boss the middle finger and say, I’m gonna start my own company today and start investing. And you know, take a chance. You got 40, 50 more years to decide what you want to do. But take that leap. Take that leap of faith and have faith mm-hmm. <Affirmative> and believe in yourself on top of that. Cuz I, myself, even being in the investment field, I know I could take more chances and I think if I was looking back 20 years from now, I would definitely smack myself over the head and say, you know, why didn’t you take that chance? Do it. Yeah. Jump off the cliff. Take it.
<Laugh>. Kyle, before you answer the question, I I’m just gonna say, when someone says the word chance, I know what you mean by saying chance, and I agree with you, but sometimes people interpret the word chance one of two ways. One is they’re gonna take a gamble, you know, they’re gonna speculate or gamble, which is high risk, or they’re gonna take what I like to think of as chance. And that is a calculated risk. I’m fine taking calculated risks cuz if you don’t risk anything, you’ll never gain anything. But that doesn’t mean you need to be stupid and, you know, and, and roll the dice and hope that you roll 11 or seven. You know, you, you want a calculated risk and that, that’s really where you have asymmetric returns. I mean, your risk might be one, but your gain might be four or five. You have enough of those going on, you’re always gonna get ahead.
Yeah. Just to cosign on that, I mean, I tell a lot of friends and just coworkers and people that ask me about, you know, what me and my brothers do and accomplish on our own. I tell them that you’re kind of playing the more risky game by continuing to work at a nine to five, eight to four, seven to three kind of job, and you’re not gonna be able to retire those 401ks. So you’d be lucky to get $250,000 by the time you go to retire. And that’s, if the market’s doing good, it could take you 20 years to build it up and you can lose it all in a, you know, a day. Yeah. So you’re already playing the risky game by taking Right. You know, by playing that game. Right. So why not play a game that you can control a little better?
Right. Yeah. In that light, it’s basically saying that it may be far more risky to not invest wisely and invest in real estate than to actually go out there and do it and, and invest and, you know, do something for yourself in your financial future, Kyle.
Yeah, no this is kind of gonna be interchangeable with what Troy said, but I would say just get comfortable with being uncomfortable. A lot of the accomplishments my brothers and I have made over these past couple years and a lot of the things we’ve done based on our upbringing, we shouldn’t be here right now, if I’m being completely honest. You know, we are the last three guys on planet Earth who should have real estate properties and other investments outside of real estate that my brothers and I have accomplished as of late. And we have done it, and we’ve done it by getting outside of our comfort zone. It was a big deal for us to start investing in real estate. Even something is going to power room. I mean, we live in Pennsylvania, power Room was in Florida. I mean, that took a lot of planning and time and you know, money to get out there, right?
So I would say if you’re stuck in your comfort zone, you’re never gonna accomplish anything. If you go to work, you make your little 50, 60 grand a year and you put, you know, 4% away in your retirement plan and hope and pray that that’ll be there when you’re 70 and you, maybe you get to go on a couple vacations after you retire. I mean, that’s, that’s not living, you know, you gotta get uncomfortable. Take some calculated risk. As you were saying, Marco, jump on the opportunities that come your way. Get out and meet some people. You get comfortable with being uncomfortable.
Mm-Hmm. I like that. That’s very, that’s a very, what is it on Twitter, you tweet, that’s a tweetable.
That’s a hashtag!
Right there. <Laugh>.
That’s definitely hashtag get comfortable being uncomfortable. I love it. Yeah. Well, that’s it for today, man. This has been great. I really appreciate it. Is there anything else you guys want to add? As we wrap up here?
We’d love to give an update someday where we’re at, you know, maybe a year or two or so down the road. I’d love to get back on and hopefully help some viewers out there that are,
You know, yeah.
Looking for advice.
That’d be great. Part two with the Jonas Brothers. Absolutely.
Yeah. I gotta say this, Marco as well really appreciate everything you’ve done for us. You’ve been a indirect mentor for us for the past three years. No guys, Marco did not pay me to say this, but he’s he’s just been wonderful to us and you’re a wealth of knowledge and it is, it’s my pleasure, my honor
I appreciate it.
I just wanted to reiterate with a, with another thank you for having us on. Of course. This was amazing.
Thank you. You guys are incredibly kind. Dillon, Kyle, Troy, you guys are incredibly kind. I am sure I’ll meet you again absolutely soon. All right, well, I wanna say thank you for taking the time. You guys have been great. We’ll do this again. I appreciate it.
And in wrapping up here, just for everybody else, just if you haven’t subscribed to the show, remember to do so, takes you like all of three seconds. If you wanna speak with my team as these guys have done and, you know, and have started to build a real estate portfolio just reach out to my team, you know, and get your free strategy session. There’s no cost or obligation, it’s just something we wanna help you with. Figuratively, hold your hand and just share the show with your friends. If you like the content, leave us a rating review on iTunes and, and we’ll just share the word with more people. But that’s it for today. Thank you for listening. We will see you all on our next episode.
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