Welcome to Cleveland Real Estate Investor. On this podcast, you'll hear about every aspect of the real estate investment business. You will talk to your rockstar investors about their businesses, how they built them, where they came from, and where they're going. Who am I? I'm Joe Lieber and I've made millions of dollars from the real estate investment business over the last 20 years. If you're ready to hear the good and bad from a guy who's learned this business from the school of hard knocks and get educated by some bad ass entrepreneurs, then put your helmet on, strap on your chin strap. Let's ride.
(00:54): Hey, yo, what's going on guys? Thanks for tuning in today. Sure. Appreciate you tune in to hear me talk about all kinds of cool stuff today. So, Hey, we're going to do a show about this. Come by special request for new investors. People are new to the game. You don't know where to go. You don't know what to do. I've been there spends along though. I kind of forgot what it was like, what I'm just going to talk about today. What I would do if I was new to the game and how I would get rolling, but Hey, before I start today, cause it's the, it's the end of the year. And new year's is coming everybody though, what do they do? New year's they set goals, all this goal setting going on. I see it in all aspects. My wife, I'm going to lose 10 pounds.
(01:43): So her goal this year, or I see all these guys online, big shots or goal setting, I'm going to buy 300 doors this year. And that's cool. I did that. I did all that for a lot of years. Those were my goals. Like bigger growth bang. It let's do it. Let's get 300 doors this year. Let's flip 60 houses. You know, I dunno, I'm going to buy a bigger house. I'm gonna buy a Rolex. I don't know whatever the hell it is. Right. I had all those goals. I did that. But what I've noticed is like, things are changing as I get older, your priorities change. Those things might not mean as much to you or they don't to me as they used to. The goals changed. So like I know you're probably wondering what are the goal? What are your goals, Joe? Well, it's different for me now.
(02:32): So like my goals are things like, I want to spend more time at my Lake house this summer. I want to spend more time with my family and less time in my business is a goal. I want to impact people. I'll give you a good one. I make an impact. I just saw this other day. I live in a town called Hinckley here just outside of Cuyahoga County and this Jack here. I'm saying it. Mother goes over to the cemetery and Hinckley with their three-year-old little boy and didn't want the little boy anymore and drops the child off in the middle of the cemetery and takes off. And this little boy is running after the car and only me don't leave me and this mother just splits. What the hell? Like you can't make this stuff up, right? It's all over the news.
(03:25): Thankfully or someone in the cemetery seen this go on. And the lady came over and puts a little boy in her car called Hinckley PD. And you know, they took a little boy and there was a huge outpour in the community, right? People are reserved before Christmas and people are bringing gifts and gift cards and clothes and all this stuff over to the Hinckley police department. I like that. I like to get involved in that. I like to give and have impact because this idiot did this to a child and that's like my goal, right? Impact people make a difference, something like that. But it's different things, right? So more time with the kids. It's not about me anymore, but how much volume I can do? How many more doors I can acquire. I just want to change. So as your goal setting this year, and I'm not telling you your goals should be like mine or anything, that's just what happens.
(04:22): It's a natural progression. It just, I don't have an interest in getting a new Rolex this year. I don't, I don't care have an interest in impact. I have an interest to spend time with my family. So whatever, as you're thinking this year about this or that maybe I'll have some impact on you. All right. So anyways, let's get started. Had a person contacted that I've known for 20 years, Lincoln. This episode is for you buddy. And we're talking about this for him today. He called reach out to me. He says, dude, I want to get into the game, Joe. I've seen you do it for a lot of years. It's interesting from what he sees, it looks like real estate has given me everything that I could possibly want from this business. Freedom, time, money, flexibility, no boss, all that. And you're right, Lincoln.
(05:09): It has, it's a good business. I'm not going to lie. It's great. It's given me all that and give me independence. So when he says, well, how do I get into it, man? Like, you know, how do I get started? And I'm just sitting here reflecting on like what I did coming up through the game. The things that I wish I would've known, I wish I had somebody to guide me. And I'm just gonna start talking about it and hopefully I can roll a nugget to you and you can use that information and take you where you want to go. So, all right. So listen, invest in there's two kinds of really is two things you're going to do as a newbie. You're thinking of flipping homes to build your cash, or you want to acquire rental property for cashflow and wealth, building wealth and all the cool things that can do too.
(05:57): Now I'm not the guy to sit here and like motivate you. I'm not like the guy that's gonna tell you all the benefits of owning a rental property and how awesome it is with the amortizations and net worth and growing. And the best guy for that is go get yourself an audible subscription and listen to Robert Kiyosaki. His first book, rich dad, poor dad. It's the bomb. It has motivated more people to get into real estate. And I can tell you all the people I've met over the years. I always ask how'd you get in the business. What got you excited about it? And it's always that one book, rich dad, poor dad by Robert Kiyosaki, total game changer. For a lot of people I've met very seasoned people got into the business because of that book. So I would like, you got to educate yourself, right?
(06:40): So you didn't do it through books. Like I did back in the nineties because there was no such thing as audible. You got your Walkman out with the CD player, which was really cool. And you'd go, I could go to the library and get like motivational CDs and put them on my Walkman. Terrible. But you just told me you cats know what I'm talking about, but now it's so easy, 1495 a month and you get yourself an audible subscription. You know, I just talked to my brother-in-law a couple of days ago, he came over and he was griping about something. And I was like, let me ask you a question, uncle Dan said, how much money do you spend your education last year? How much money did you spend educating yourself to get better? He goes, we'll zero. Oh, what the hell kind of results did you expect?
(07:27): Put zero into it. You got zero out. I know I don't care who you are. You can afford 1495 a month for an audible subscription. And there is so much stuff in there. It's amazing. Like, just think about this. Even this cast is free to you and this is totally the two years of all my trials and tribulations that I go on here and pour out to you for free. Enjoy it. It's fun. Getting all that you guys got to spend the time. And instead of watching another Seinfeld episode, listen to only my podcast listened to a podcast, listen to an audible audio book. It will take you to places. You never would have thought another one, biggerpockets.com. It's a great website. It was started by a guy named Josh Darkin about 12 years ago. And this dude has grown an online community. That is ridiculous.
(08:21): It's like Facebook for real estate investors. I'm a member on there. It's really cool. People are posting all the things like questions you're going to have, like, how do I get alone? How do I find a house? All that entry-level things that you don't know, you will learn about them on bigger pockets. There's some real players on there that are sharing knowledge and things like that. So I would definitely spend all my time on bigger pockets of post to Facebook and Instagram. I mean, you know, by the way, I'm on Instagram a little bit. I go on there just to look around a little bit. I consume as they say, dude, it's cool. But the stuff I'm seeing, it's like all motivational stuff. That's great. I love the motivational little taglines and all that. Like I used to say to myself, I need actual things.
(09:07): Like what exactly do I do? It's great that you have all these little analogies about wealth and passions and, and money, but how do you put this into play and make it work? So I would stay the hell off. Instagram was on telling you, go on bigger pockets. Cause you'll get the answers, the actual things you need to do to make this happen. Not just like a theory, like you can be great and a picture of a line or something. Well, great man. But like I need to become great now. Right? So RIAs RIA stands for real estate investor association. There's two here in Cleveland. I know of. And I think you should join. It's like this 200 bucks a year to join. They have a meeting right now, a little tough cause a COVID I think they're doing their meetings online, but it's a community of local real estate investors that are talking about deals and financing and opportunities and questions and landlording and all the different things.
(10:00): So I would look into the REOs and when the COVID lifts, I would start going to the meetings. They have more at the holiday Inn and independence as where like their home bases. So I would do that. Get a mentor, get a Mensa, get someone to mentor you and don't look for a free mentor. No, no, don't do that. A paid mentorship, one that's really going to help. You have find a real estate guru who does this for a living and do it paid mentorship. I'll take of my favorites and I get nothing out of this. No, I'm just plugging them for free Ron Legrand. He was a mentor of mine a long time ago. He's still in the game. He still teaches. Is that a Jacksonville, Florida just Google his name. Ron Legrand. L E G R a N D. Great dude. Really knows his is he's an O G man.
(10:45): He is a godfather. He gets it. He was good to me. I learned a lie. He changed my whole business in 2009. I'm still incredibly grateful for it this day. And it's kind of awesome because he was a mentor and now him and I sit next to each other in a mastermind. We're in the same mastermind now. So that's kind of weird how that came full circle, man. But it was like a proud moment for me the next to run. So of him being on a stage and me being in the room, I was like shoulder to shoulder. I was like, Hey, Holy, this, man, this is cool. So, but yeah, whatever. So get a mentor, right? Cody Sperber I know he does mentors. Joe McCall is a mentor. These are all guys that are just big players that have positioned themselves to be coaches and mentors in the real estate business.
(11:24): Now I'll tell you right now, it's going to be expensive. It's going to be expensive. If I waited till I had money to hire my first mentor, I would still be waiting. Think about, let that resonate for a second. If I waited until I had money to hire my first mentor, I was still be waiting to have money. You'll never have however much money you think you need to have in order to pay three to $20,000 for a mentor, you just have to do it, do the jump off and do things you don't want to do to become great. Maybe you're not going to take your family on a vacation this year because you're going to drop 10 grand and Cody Sperber his program, but it might change your whole life. And it might not that there's no guarantees. Oh well, that's why people are great.
(12:05): That's why people are not good because people take risks and there's a chance. It might not work out for you, but that's a demon you're going to have to overcome. So if you want to be great, then start acting like that. Carry yourself like that. So here's another one that I did back in the day is a joint ventures. I haven't realized I was doing them. I didn't call them joint ventures back then. But you know, as a young guy, you're 25, 26, you don't really have any money, none, any real money, not money to like acquire real estate with. So I would join venture with people. I would network people who had money and then I would get them excited about doing real estate. Basically I would get them as excited as I was, and I would figure out what they could bring to the table and do a deal with.
(12:49): So like here, I'll give you some examples. So like in my mind, four components, right? There's the acquisition or the house to buy or whatever they over asset class, we'll say houses. Cause that's what we specialize on on here. There's the money or the financing part of it. There's the rehab. And then there's a sense, cause we're talking about rental properties, there's the property management. So I would just think about what I could do, right. So I know I can bring acquisition. And for you guys who are thinking of hybrid acquisition, well just looking at the lowest hanging fruit places, right? Look on the MLS. There are deals hiding in plain sight. I told you guys on a previous show, I took a couple of deals or right out from underneath you cats this year, they were sitting right on MLS. They didn't pay attention to them.
(13:33): They went 30, 40, 50 days on market seller was ready to do a deal. And I came in and sniped those deals. So they're hiding in plain sight. And then if you want to play the auction game, try that, you know, auction.com the zone that's X O M e.com Hudson and Marshall's and auction site. Like you can start chasing that game to con for sale by owners, all that stuff. I don't even call it entry level stuff because the pros still do it to this day, but we just do it where most people try it for a month or two, that guy it's just. Doesn't work, man. And then great, good you're right. It doesn't work. And I got one less person to compete with, but it does work and you just have to stay on it, man. It's like a diet or you got to stay on it for it to work.
(14:17): You don't lose 20 pounds in a month. Maybe you do. I don't, but you got to stay on this stuff for it to work. You can't lose that focus and motivation. So yeah, what I was good at, I would bring those things to the game. So you could bring acquisition or you could hook into a realtor. Someone that could help you scout deals, the money and finance part was where I struggled. I was working as a real estate agent by day. So like you're on a 10 99, not really showing income was you're writing everything off and you not qualify for any bank loans. So I needed a financial partner and in the very beginning, I would just bring someone in who had a job and steady income and good credit. And they could qualify for bank financing that I would just partner with them on the deals.
(15:00): Basically we were just 50 50 partners and it works. It worked, you know, I had to do that. And then I start getting myself on different people. People were making real money and then I would just have them either put down, down payments and carry loans or have them pay cash for the house. And that was, that was a cool, that was a game changer. I owned a lot of houses there for a period of time where they were all with partners. So I only owned 50% of that house, but I probably had, I don't even remember 50, 60 houses at one point and probably Oh four Oh five. And they were most all of them were partners. I probably had 10 by myself somehow. I remember how I got them, but, but most of those were partnerships. And I would just reach out to guys who want to get into the business guys who were making money at that time, the mortgage business will still is hot, but it would the mortgage lending, origination business hot.
(15:46): And I had ties to that business. So I was always around those guys and they were all making big bucks even back then. And I would just go around to them and be like, Hey dude, you know, you made 15 grand last month. You want to go get a 10% down loan and partner on something. And they're like, hell yeah, I got six grand, some closing costs. And that's how I did it, man. You know, they always liked me and we had good relationships. So I, I must had 1820 partners at one point, all these mortgage guys. And it was crazy, but I'm glad those days are over. But if you want to get started and I had to get start, that's what you have to do. Sometimes you just have to do that. Then there's the rehab, right? So Lincoln, I know, you know how to do this.
(16:23): I don't think you do it anymore. I'm not sure what you do, but I know you're good at it because you just stopped for me back in the day, even my personal house. And that is a great thing that you don't have to do, but you can construction manage that. You know how to hire these guys. You know how to make sure you know, this guy is not you know, an idiot. You're good at it. You understand that. So that's a great, the construction piece is one of the biggest pieces of this puzzle. And I would have to say, you got that on lockdown. You understand it. And you know where and how to find guys in the right guys at the right prices. And no one's going to rip you off, man. No one is. I remember you would explain things to me back at that time.
(16:58): And I didn't understand what the hell you're talking about. You're like, I'm going to cut it in up here and then we'll be done. And I'm like, cut it in. I don't even know what that means. I'm 23 years old. And all I know is how to acquire property. Now I don't understand the construction piece of it. And you know, there was opportunity there. You know, you just don't know, you know, you had to learn and you're really good at that, man. So my advice to you is you might want to focus on bringing that to the table and not, I'm not saying do the work, but being more of a magician and figure out how to get the right guys in the right price to do the work. And then lastly, there's the management piece, right? So property management, it's a whole science that if these properties aren't managed properly, you're going to lose money.
(17:35): You're going to be evictions. You're gonna have turnover. You're going to have maintenance things to do. And management is a big piece to this. So you gotta figure out what you can do and what you can bring to the table and look for the other pieces as a newbie, don't try doing it all yourself, man. You're not gonna be able to do it. You're not going to want to do it. It's a lot of work, especially if you're working a full-time job, which if you're new to the business, you're doing something. Full-Time. If you're providing an income for a family and my advice of when you take on a JV partner, just make sure you define your roles. Like make sure we know is what their job is. And as things go sideways and people get burned out and upset because of misunderstandings. You know, one guy feels like he's doing all the work because they're doing acquisition and hell.
(18:18): They might even be finding a private investor. And then they're managing the rehab. They're doing the management. They're like, what did you do? Why are, why are we 50, 50 partners? Like that can happen too. So make sure your roles are, well-defined like, you'll do acquisition. They're going to bring the money to the deal. And that's their only thing. You might not want them doing more or you might want them to share a management with you or they got to manage or you know, something. And then how long don't make it as like infinity deals. Like they just go forever. Like we're going to manage this property for 30 years and we're going to cash flow. No, don't do that because stuff always changes. You know, I had parties in back at that time were young guys and guys come to me, Hey, I'm getting married.
(18:55): Like, Oh geez. So what happens to our partnership now? We're 50, 50. And now is your wife, what is she getting this? Or I've had, I'm getting divorced or I'm moving out of state, out of town. I'm leaving this job or company, or I'm not going to see you around anymore. Like you gotta have like a defined role. Like we're going to own this house for three years and then we're going to sell or put a buy, sell agreement in place. And that's the next thing that's going to say, put something in place where you can buy the partner out. He can buy you out for these terms or put this stuff in an operating agreement. Put it wherever your attorney tells you because it'll save you no longer on. I wish I had someone to tell me that stuff back in the day, it would have been so much, I've been so much better off.
(19:35): And when I exited all those relationships, like they were fine. I never had a bad blood with any of those partners. And I'm still friends, a lot of them to this day. And that's why we're, you know, you do things the right way, but still would've saved a lot of negotiations and would have saved a lot of different things with a buy-sell agreement. So I'm just looking at some of the notes I wrote down for you, cats. So you had to find your role. I told you that. Yeah, that's it. It's not going to be easy, but anything you're going to learn something new. You're going to learn a new skill set. You're going to have to go out and educate yourself. You have to learn from somebody. So good luck and you cats are new and you got a question for me, email me, call me, ping me, whatever the young bucks say I'm around. I appreciate you tuning in and have yourself a great new year. Well, when you hear this, it'll already be new year. So have a great 2021 and take care of guys. Thank you for tuning in this year.
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