Quitting Corporate with 8 Paid-Off Rental Properties ($100K Passive Income)

Eight rental properties. That’s all you need to retire early. Don’t believe us? Today’s guest went from corporate life to early retirement, generating over $100,000 per year in cash flow thanks to a small, powerful rental property portfolio. He didn’t start with a ton of money, and he had no experience. But he followed a simple, genius strategy: Save, buy, repeat, pay off. Vicente Garcia wanted to build a college fund for his children. When he moved to a new home, he realized he had an income-producing asset right in front of him. So, he turned his old primary residence into a rental, recognized its potential, and a few years later bought his first full-fledged investment property. By combining savings from his job, recycling his properties’ cash flow, and using 401(k) loans (an incredibly underrated tool), Vicente grew to eight rental properties. His goal? Not to scale, but to slowly pay off the portfolio. Now, in his 50s, Vicente has six-figure cash flow, a paid-off rental portfolio of eight properties, and only one thing on his mind: what’s next? In This Episode We Cover Don’t sell, rent instead! The life-changing effects of turning your primary residence into a rental Don’t have enough for a down payment? Why a 401(k) loan could get you your first (or next) rental faster Paying off your rentals vs. buying more: The strong argument for a small, debt-free portfolio It’s not too late to start! Why you’re only around a decade away from retirement with real estate Why Vicente says now may be one of the best times to begin investing in years And So Much More! Check out more resources from this show on ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠BiggerPockets.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.biggerpockets.com/blog/real-estate-1234 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠[email protected]⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Henry Washington?

  Eight rental properties. That's all you need to retire early. While it may seem like you have to own dozens of rentals to reach six figures in passive income, today's guest proves that a small rental portfolio can be just as powerful. Vicente Garcia had no experience in real estate investing at 41 years old, but he decided to turn his primary residence into a rental property to help him build a college fund for his kids. Now, in his mid 50s, a portfolio of just eight properties not only pays for his kids' college, but it has also retired him with six figures net cash flow. The secret? A simple but incredibly effective payoff plan. With just a handful of paid off rentals, Vicente was able to leave his corporate job, retire with six figures of income, and spend more time with

• 0:44Henry Washington?

  his kids, work for nonprofits, and ask the big question, what's next? Follow Vicente's strategy, and in a decade, you too could be retired early with fewer rentals than you think.

• 1:00Henry Washington?

  What's going on, everybody? It is Henry, co-host of the BiggerPockets Podcast. Today, we're speaking with investor Vicente Garcia from Dallas, Texas. This is an incredibly inspiring story, so let's jump right in. Vicente, welcome to the show.

• 1:13Speaker 01

  Thank you, Henry. Thanks for having me.

• 1:15Henry Washington?

  Oh, happy to do it, man. You've got an interesting story, so let's start at the beginning. Tell us about your background and how you first got into this real estate thing.

• 1:23Speaker 01

  My background is, I would say it's more like the traditional corporate world, working several companies. And I started in real estate, I don't know if it's a coincidence, but they were, you know, planning when we were trying to have a college fund, you know, that was the first, the first idea. Let's try to build a college fund for my kids. So fast forward, you know, we started investing, bought more properties. Then I became a Realtor. So I was kind of first an amateur and then became professional somehow, if you will. So all in, I've been investing for 16 years, about that, in Realtor for the last 10, you know, so that's kind of been a quick for the journey.

• 2:05Henry Washington?

  I think that's amazing. And by your standards, I'm still an amateur because I don't have my license, but that's okay. I'll take the I'll take the amateur status unless we're talking about taxes. I am a tax, I am a real estate professional for tax purposes.

• 2:18Henry Washington?

  But I think you you you're so successful. I think you glossed over a few things. You said, I just bought a couple of properties. What's that's that's that's I would say oversimplifying it. So tell us about what that looked like. When was it when you bought your first one? Why did you buy it? How did you buy it?

• 2:36Speaker 01

  Yes, yes, we bought our first home twenty years ago, two thousand and five. Started home, first kid, stayed on the home for four years. They didn't get to a point of, hey, we wanted to move to a bigger home. You know, have the second kid, looking for for change in the schools. So we bought the second home, but that was a point that, as I mentioned before, we decided, hey, right now, we don't need to sell this house to buy the second one. So the idea, hey, let's start as a college bond, you know? So that was the idea. That was two thousand and nine. Fast forward another four years, two thousand thirteen, tried to invest something in the stock market, really got burned down. And all all fairness, that was the time. So the financial crisis, correct?

• 3:19Speaker 01

  Maybe not the best time to invest in in the stock market. But either way, they said, hey, you know, have the they really rent a home for for years and okay. And there were good opportunities back then. So again, you need to go back in time, twenty thirteen, coming up the financial crisis, great deals. And we decided, hey, let's have also some friends who were doing the same thing. Let's let's now buy a a a home as an just pure rental, correct? Instead of the first one that was kind of a first home, then transition to rental. And that's how we started. And and it went pretty quick. In that that first year, we bought three homes. And the reason for that is, for me, was okay, let's let's see how it is. Let's try it. It's working. Let's repeat it. Correct?

• 4:03Speaker 01

  Reason, repeat a little bit on those on that first year, three homes. And then, of course, we continue for for the next few years to continue building the portfolio.

• 4:13Henry Washington?

  Okay, so 2013, you bought your first three as pure investments. But you started where I think a lot of people overlook starting, which is, you know, sometimes I talk to people, some of my students, or I just talk to aspiring investors. And they say, I'm looking to buy my first rental property. And I say, okay, well, tell me about where you live. And they say, oh, you know, I just, we just bought a starter home. We got a three bed, two bed, single family home in such and such a market. And I go, so you want to buy a rental in that same market? And they go, yeah. And I said, well, what if I told you you already own one? You're just living in it, right? Like, that's a great path because if you've bought a home that would make a good rental, there's nothing stopping you from buying a second home. You're probably going to do that anyway at some point.

• 4:58Henry Washington?

  But instead of selling the home, which is what most people do, you can rent the home out. And remember, most people are broke. So why would you continue to do what most people do, right? Rent the home out, which is a great idea. It gives you some perspective on if you want to be a landlord without having to go take a giant risk because you already own the asset. I think that that's a phenomenal way to start. And I love hearing stories of people who started that way. Can you remind us what market this is in where you were buying these properties?

• 5:25Speaker 01

  I'm in the Dallas forward area, which again, has been a great market in the last 10 years, I would say.

• 5:33Henry Washington?

  So you bought those three homes in 2013. What was about the price point there?

• 5:37Speaker 01

  The price point was between 150, 160.

• 5:41Henry Washington?

  So you bought three homes and the way you explained it made it sound like you kind of had a plan that you were following. So what was the strategy you were following with purchasing these properties? What was the goal?

• 5:51Speaker 01

  The original goal was the college fund, then getting into buying more immigrated. And the idea was to have our own retirement fund, you know? So we're very passionate about the whole FIRE movement and all that. So the, hey, let's try to start building our own 401K. If you build our own retirement fund, because we wanted to retire. The new definition of retirement, financially independent, I think is a better word, sooner. And that was exactly the goal. And then start building that one house after the other.

• 6:22Henry Washington?

  You know, and a lot of people. Well, I mean, let's let's be real. Most people get into this business so that they can, you know, retire from their jobs. I think retire is a word that people use kind of frivolously. Because technically, I'm retired from my job, but I work harder now than I've ever done before. But the the concept is you don't have to go to work if you don't want to. But what I think you're saying is like true retirement. No job, just money coming in. And and for people that want to get like that, like, they build the strategy typically, and oftentimes that strategy involves them scaling some massive portfolio. But that that isn't what you've done. Talk to me about what your plan is and how you've executed it.

• 7:02Speaker 01

  Okay, we we bought three. He was working and we continued buying some pretty much in a span of, I would say, three years, we bought eight properties.

• 7:14Henry Washington?

  Okay.

• 7:14Speaker 01

  Now, one of the things we decided, because we were fortunate to have our regular jobs, is we're not gonna touch that money to start spending on something else, correct? All is gonna stay on their own bucket, you know, let's not start buying a new car.

• 7:32Speaker 01

  That was also, I would say, the discipline and foundation that we had to then allow us to start paying back those properties.

• 7:40Henry Washington?

  So instead of buying a hundred doors, you wanted to buy ten, twenty doors, but focus on paying them off with the cash flow instead of growing your portfolio or buying liabilities. Is that what I'm hearing?

• 7:52Speaker 01

  Yeah, and to be honest, it was not like a, we thought about it from the beginning, between twenty thirteen, twenty fifteen, what several properties, twenty fifteen, I got my license. As I say, now I have, I have things to manage, and maybe it's easier for me to to, and you know, when you need to have the house rent or buying something else. And that was to the point that we said, okay, do we keep growing, take money from that equity that you have in there, correct? And have that house buy you another house, correct? And to your point, then you go, you start, you start up with that. So, I mean, my personal situation is I wasn't doing this full time. I mean, I still have to do my full time job, you know, so think about it, three jobs, you know, my regular job. Managing the properties plus the Realtor, correct? A lot of hustle.

• 8:36Speaker 01

  So it was a personal decision, hey, now, okay, I think we're good where we are. I think in a good path, what do we do now? Okay, if we're not buying anything else, you have some clashes that are coming in and that was the plan. And the way we did it, it was kind of focusing one property at a time. We decided, okay, property A, this is the one we're gonna pay first. And then kind of, you know, redirecting all this funds. And of course, you know, there's also sometimes like you might get, I don't know, a bonus from your job, something like that again. Anything that is extra, you know, try to start paying down. And I don't know, to be honest, if it's a cultural thing, you know, that we Latinos, we don't like that, we were kind of raised with that, hey, you know, Jeff is bad, you know, and

• 9:19Speaker 01

  try to pay them, I don't know if there's something into that, but I don't think there's, I mean, there's good, good day, bad day, but I think in general, you know, it's a strategy change, you know, and and that's what he decided to do at that point.

• 9:31Henry Washington?

  All right, we're gonna jump into how Vicente purchased his first three rental properties, but before we do, we have to take a quick break. We'll be right back. As a real estate investor, the last thing I want to do or have time for is to play accountant, banker and debt collector. But that's what I was doing every weekend, flipping between a bunch of apps, bank statements and receipts, trying to sort it all out by property and figure out who's late on rent. Then I found Baseline and it takes that all off my plate. It's BiggerPockets' official banking platform that automatically sorts my transactions, matches receipts and collects rent from every property. My tax prep is done, my weekends are mine again, plus I'm saving a ton of money on banking fees and apps that I don't need anymore. Get a hundred dollar bonus when you sign up today at baseline.com/bp.

• 10:15Dave Meyer?

  Most deals don't fall apart because of the numbers. They fall apart because of the financing. You find a property that cash flows, the deal makes sense. But then the lender looks at your personal income, your tax returns, your debt to income ratio, and suddenly the deal doesn't qualify. That's the disconnect. Because as investors, we're not buying based on our W2, we're buying based on the asset. That's why Host Financial offers SCR loans designed for real estate investors where qualification is based primarily on the property's income, not your personal finances. So no W2s, no tax returns, and no DTI requirements.

• 10:57Dave Meyer?

  And with loan to value options up to 80 or even 85% on eligible deals, you can keep more capital available as you grow. If you're buying rentals, refinancing, or scaling your portfolio, go to hostfinancial.com, that's H-O-S-T financial.com, and see what you qualify for. Some listeners may wonder why their insurance quote only took 30 seconds. Some listeners may wonder why their insurance quote took 30 seconds. A better question is, how long will that policy actually hold up when you need it? At NREG, the goal isn't just getting coverage in place. It's making sure your investment property is properly protected when a real claim happens.

• 11:38Dave Meyer?

  That's why they take time to evaluate each property's unique risks and build coverage design for the realities investors face. Because anyone can sell a policy, NREG focuses on standing behind it. Visit n-r-e-i-g.com/bpllc to learn more.

• 11:57Henry Washington?

  Here's a strategy that most W2 employees have never heard of. Normally, if you want to write off a rental property against your regular income, you need real estate professional status. That means tracking hundreds of hours a year. Rent to Retirement just launched a program that skips all of that. It's called the STR loophole tenant placement program. Here's how it works. You buy one of Rent to Retirement's Class A new construction investment properties. You set up an Airbnb listing and self-manage it for the remainder of the year. Rent to Retirement then rents the home as a short-term rental to establish it as an STR for the year. No furnishing required, making this the easy button to save five or six figures in taxes this year.

• 12:39Henry Washington?

  And because you're the sole manager, there's no hourly minimum to meet. That lets you use a cost segregation study to accelerate the depreciation and potentially write off over $100,000 against your income.

• 12:52Henry Washington?

  On your first rental, add in cash back up to 13% of the home price, which exceeds $60,000 on some properties. With this massive cash back incentives, investors are seeing total returns up to 126%. New construction, A-class properties and inventory is limited. Learn more at biggerpockets.com/retirement or text REI to 33777. Again, text REI to 33777.

• 13:21Speaker 03

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• 13:54Henry Washington?

  All right, we are back with Mr. Vicente Garcia, talking about how he built his rental portfolio. Let's jump back in. Mr. Vicente, so you bought the three properties in 2013. What's the financing method you used? Or how did you find the funds to buy these properties?

• 14:10Speaker 01

  I would say for the first one, very simple, correct? Okay, traditionally 20% down for second property investments. So, okay, that's the first thing. Okay, how much money down you need, correct? Which is, and also making sure you have the financing for that. Back then, the first property was, well, we have some personal savings. And again, it was a different price point for what it is right now. That now 20% to your point is much higher, you know, but at that point was 20% about the 150. But this first property, then is when you start getting creative.

• 14:40Henry Washington?

  So what I hear you saying is you bought the first one with savings and when you wanted to buy the second one, the savings hadn't replenished itself yet.

• 14:48Speaker 01

  Exactly.

• 14:48Henry Washington?

  Okay, so how did we do the second one?

• 14:51Speaker 01

  In my case, something that I did is I had I have my 401k, you know, for my job. And many people don't know that you can get a you can borrow money against your 401k. Pretty much you're borrowing money to yourself. So that's how we go to the second one, what is it creative? Because again, sometimes people don't know, don't know, no, but no, no, many people explain you that, you know. And the companies don't explain you that. They don't want you to take money.

• 15:17Henry Washington?

  Sure don't. They sure don't. And this is, this is cool because this is what I did to buy my very first one. I, unlike you, didn't have any savings. So I had to get creative from day one. And that's what we did. We borrow against, well, we borrowed against my wife's 401k because I didn't have one. So we borrowed from hers. But yes, exactly. That's exactly right. If you borrow from your 401k, traditionally you pay yourself back because it's your money and you pay yourself back with interest. And if you're renting a property out and it's cash flowing, then technically your tenants are paying back your loan which you used to purchase the property. Now, the caveat is you've got to be really smart with that money. It is your retirement savings.

• 15:59Henry Washington?

  So if you borrow the money and then you buy a bad asset, you could find yourself in a world of hurt. But if you buy a good asset, it can be very financially beneficial. So yes, I think that that's a a good tool in the tool belt to use for the right people in the right situation.

• 16:15Speaker 01

  In 2021, you know, COVID years, everything equity went through the roof, you know, the appreciation peaked. So what we did is we refinanced our existing home, our primary house, primary residence. We took a cash out, refinanced it, and paid two of the rental properties. And the reason to do that is because we trade an interest rate of, let's say, 4.5 now to an interest rate of 2.75.

• 16:45Henry Washington?

  So what you're saying is you essentially arbitrage the debt. So you had a 4.75 interest rate on the rental property. But you could borrow money so cheap on a line of credit. So you borrowed at 2.75, paid off the house that was at 4.75, but you've still got the money coming in. So you're paying back the line of credit with the money coming in from your rental. But you're now paying off 2.75% debt instead of 4.75% debt.

• 17:13Speaker 01

  Exactly.

• 17:13Henry Washington?

  That is super cool. Lots of people borrowed money and bought homes in 2020, but I haven't heard of somebody arbitraging the debt like that to pay off a rental property. That was, that's a really cool, really smart thing to do that the market provided you.

• 17:26Speaker 01

  And don't want to get too technical, and I'm not a tax advisor. You are still able to deduct some of that interest on those rentals.

• 17:34Henry Washington?

  That is something I hadn't thought about, and now that I'm looking back, probably wish I would have done something similar.

• 17:41Speaker 01

  You need to wait.

• 17:44Henry Washington?

  It's not gonna happen again, buddy.

• 17:47Speaker 01

  Never say never, you know, but yes, not in the short term.

• 17:51Henry Washington?

  That's true. So I've got, I've got a few more questions around this, this strategy in this portfolio. First being, how old were you when you bought those first three rental properties?

• 18:04Speaker 01

  Forty, forty-one. It's not immediate. I was like right out of college, correct? And plus, plus we're immigrants, correct? So we came here when I was 30 years old. It's been 23 years since we came here. So for us, it was kind of, hey, you need to restart or reset. A little bit, but yes, to your question, you know, 41 years.

• 18:22Henry Washington?

  I love how relatable your, your story and your method is. Like, I think people here invest in real estate and they automatically think, I have to be this, you know, huge landlord that owns hundreds of assets and runs this, you know, multimillion dollar real estate business, when you can just buy a few homes, have a strategy that focuses on paying them off, and you can live a wonderful life. And I just love, I love talking to people who have used real estate in ways that maybe the normal investor doesn't even consider or think about anymore. The next question I have for you is, were these value-add or distressed properties? Or were you buying them basically turnkey? They were ready for a tenant?

• 19:06Speaker 01

  It was a mix. I would say the, the majority, they were pretty ready. I mean, existing homes, you know, of course you have to do some, some, some minor work to get it ready. Couple of times I did. Short sales, you know, and and and those were were very, very interesting. It takes more time. You have to be patient.

• 19:24Henry Washington?

  Yes, it does.

• 19:26Speaker 01

  But they're great. They they were great. Did some minor renovations to get it ready, but uh it's it's been a mix. My my my approach on that was I'd rather pay more for something that is ready, but because at the end, uh, everything is going into the loan, into the down payment, correct? So paying ten thousand dollars more for a property when you go to the down payment is only maybe two thousand dollars versus paying less, but then you need to take that money out of your pocket. You know, that's something I tell my clients. Sometimes people, hey, you know, this house is in twenty thousand dollars a year. Yes, but then do the math. How much you need to put on? I don't know. I I went to see a house the other day, foundation. Okay, so how much it gonna cost you? It still might be a good deal, but you need to have the cash for it.

• 20:10Henry Washington?

  All right. I'm talking to Mr. Vicente about his plan, and we're gonna dive into where he is today with his portfolio. But before we do, we're gonna take a quick break.

• 20:19Dave Meyer?

  For my wife's birthday, I wanted to make her a new website for her landscape design business. So I researched a lot of different options. I tried out a couple. But honestly, it was really overwhelming. It was pretty time consuming, and still the site wasn't coming out the way I wanted it to. Then I tried Hostinger, and everything was super simple. I asked Hostinger's AI to build a clean site for her business, and it had a working version up in minutes. No coding or designer needed. Plus, its AI agent helps with SEO, website copy, and email marketing after launch. You get domain, website, email, all in one account. And right now, you can get Black Friday and Cyber Monday pricing through December fourteenth.

• 21:03Dave Meyer?

  So snag Hostinger's services at their lowest prices before the sale ends. Create your website today for just a dollar ninety-nine. Go to hostinger.com/realestate and use code REALESTATE for an additional ten percent off Black Friday and Cyber Monday pricing. I just booked a ski trip to Park City, and I've already got the whole thing planned out. Five days, first tracks every morning.

• 21:27Dave Meyer?

  Before the crowd show up, my knees reminding me I'm not 25 anymore by the second run, and an embarrassing number of overpriced burritos at the lodge. I don't even care. This is the trip I look forward to all year. But here's the part I actually appreciate. The practical side of my brain kicking in is that my place doesn't have to just sit there empty the whole time I'm away. I can list my space on Airbnb and bring in a little extra income while I'm out getting humbled on a mountain. And with the co-host network, I'm not the one handling all of it. You can partner with a vetted local co-host who can create your listing, manage reservations, message guests, and even handle the styling.

• 22:09Dave Meyer?

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• 22:53Dave Meyer?

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• 23:26Speaker 03

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• 23:56Speaker 04

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• 24:29Henry Washington?

  All right, we are back with Mr. Vicente Garcia. We are talking about how he built his portfolio of paid off assets. Let's dive back in. So Vicente, you went down the path of being a small and mighty investor. You had a goal of paying off some of these properties. Talk to us a little bit about where your portfolio is today. How many houses do you own? How many of them are paid off?

• 24:53Speaker 01

  Yes, so the current portfolio right now is eight, all paid off.

• 24:58Henry Washington?

  Oh, you paid everything off.

• 24:59Speaker 01

  Now, something that we have done in the last couple of years, actually two years in a row, is what I call refresh the asset. And that's the 1031s. So we've done it for a couple of reasons. There's no secret that in some communities HOAs are getting very aggressive.

• 25:17Henry Washington?

  Yes.

• 25:18Speaker 01

  So I would say in one particular community, where we started, we were very, we have several assets in there. So we needed to start, hey, moving around to avoid problems with HOA. Another reason is to what I mentioned, refresh the asset. You know, some of those homes are already 20 years old. And what we did is sell some of those properties, buy a brand new one, different area of town, and do a 1031. That's something that has worked out great. Again, again, it's a personal strategy. You don't have to do it, but I'm telling you some of the stories that we have, you know. So we've done total three exchanges so far, and the last two have been back to back, you know, 2024, 2025.

• 26:01Henry Washington?

  That's great. That's actually another really smart thing to think about. Think about when you're focusing on paying off assets, you're right. If you have a paid off asset and it's a distressed asset. Yeah, it's paid off, but you spend a lot of money fixing it up, right? You spend a lot of money fixing repairs or updating the properties. And so instead of you taking capital out of your pocket to update an old asset. You leverage the asset and the tax code. Does a ten thirty one exchange? And for those who don't know, you're allowed to sell a property and then defer the capital gains from the sale of that property as long as you are buying an asset of like kind. And it has to be a higher value.

• 26:43Henry Washington?

  And so you were able to probably not have to spend any of your own money, buy a newer asset. Now that asset costs more, which means you probably did end up with a small mortgage. Did you do that and then work on paying that off? Or did you just?

• 26:57Speaker 01

  No, no, no. You know, no, like for life, you know?

• 27:01Henry Washington?

  Yeah.

• 27:01Speaker 01

  All, all, all in. I mean, the, the, the catch on that is you have to go to a different area.

• 27:07Henry Washington?

  Yeah.

• 27:07Speaker 01

  Correct? So it may be in my case, uh, areas where you still, you need to move.

• 27:15Speaker 01

  One by the next one, areas and also maybe areas that were the next growth is gonna come.

• 27:20Henry Washington?

  Yeah.

• 27:21Speaker 01

  Okay, I'm gonna give you an example. The one we just did is, is in Collin County is Selena. Selena is an area is, is been in the news, you know, last year, you know, one of the, the, the top cities growing percentage wise in the country. Correct? So it's also a little bit of a, of a bed, if you would. It's kind of a killing, trying to kill two birds with one stone. One is refreshing the asset, everything that you said about the property that lean out of maintenance. But also, hey, where, where is growing? What is the next road? I mean, kind of a, what we did ten years ago when we bought in the Aubrey area, the first home, it was a rural area. Rural. Now you go there, you have Costco, HEB, hospitals. Market, Walmart, everything. Right now, it's kind of way, you know, that area, the same thing

• 28:04Speaker 01

  that happening, you drive, you see that they're building Costco, they're building HEB, they just opened a hospital. So it's kind of, hey, let's move to where the next growth is and hopefully, you know, the appreciation will come.

• 28:16Henry Washington?

  This is fundamentally sound real estate strategy. I mean, you focused on buying one to three assets at a time. And instead of growth, you focused on paying them off. And then when you got to a point where some of them were starting to get paid off, you did leverage the asset, but you didn't leverage the asset in order to acquire more debt. You leverage the asset to update your portfolio without having to use your own cash and just using your market knowledge and you're a Realtor. So of course, you're supposed to know where the path of progress is and where things are going. So you leveraged your superpowers to buy assets and in new up and coming parts of town. So Vicente ate paid off houses. That's incredible in itself and doing it in such a short timeframe. But what people really

• 29:01Henry Washington?

  want to know is how much cash flow do those houses produce?

• 29:06Speaker 01

  Target is around, you know, between fourteen, sixteen hundred per property, you know, that's, that's the target and that's the plan. Some years, you are able to achieve the numbers on depending on what the properties need, correct? I mean, I'm going to give you an example. Last year, end of the year, property needed a new air conditioning. That's about, was about, I don't know, eight thousand dollars. So that, that month, you know, your cash flow come down, you know, and it's not, so I'm going to, you could call it, you know, goal ineffective, you know, but the goal, if everything goes well, is between fourteen, sixteen per property.

• 29:44Henry Washington?

  That's fair. And I appreciate the transparency because most people will just say, oh, I make a ton of money, right? But to put that in perspective. That's somewhere between a hundred and ten to a hundred and forty five thousand dollars a year of net cash flow on eight properties. That's amazing. So that's gotta feel good.

• 30:05Speaker 01

  Maybe less.

• 30:09Henry Washington?

  That's what the general math says. So that's really cool. So it sounds like your goal or your strategy of acquiring eight to 10 paid off properties, you hit. Did you hit your second part of your goal or strategy of retirement?

• 30:22Speaker 01

  Yes and no.

• 30:27Speaker 01

  Yes, because yes, I mean, I'm not perceiving that that income, you know, from my full time job. So, so yes, and we're still able to, to, to manage. I mean, and no, because I'm, I'm still working. You need to, you need to still manage property. You have the real estate. I'm still doing some of, you could call it small consulting on that. But something else that I'm doing also, that's something personally I wanted to do is spend also more time on nonprofits. So I'm on the board of three nonprofits here in Dallas. Something happened the last few years. But at the end is, is, I would say is, is, is having the flexibility, correct? And, and, and I'm blessed for that. It's having the flexibility of, of doing, um, Mark Cuban has a famous clip, you know, that doing, doing what I want, when I want, with who I want, you know, when I want, kind of like that.

• 31:08Henry Washington?

  How I want, that's right. That's right.

• 31:10Speaker 01

  Exactly. It is, you said that dumb, but, uh, but, but yes, uh, I mean, I think it's, um, too early. And also I would love to keep helping people do the same thing, you know? Yeah.

• 31:21Henry Washington?

  Well, that's amazing, man. I love seeing people who build a plan within the real estate niche, execute against that plan and, and see it through. That's really cool. So you are an agent. So why continue to be an agent?

• 31:36Speaker 01

  I love it. It's stressful sometimes, you know, I have some, some scars, you know, from some transactions, but I really, I really love the, the interaction with people. Many of my, unfortunately, because many of my clients are also my friends or happy conference, you know? One of my friend from, from Chaiho, he was debating, should I buy a house, should I not buy a house? They told me, just do it, just do it, you're gonna be okay. You can rent out one of the bedrooms to help you pay the mortgage, all that. He did that and, uh, like two months later, he called me several times and just to thank me. Hey, thank you for pushing me. Thank you for, it's the best decision I ever made. Super happy with his house. It's kind of, you know, like, so those things are, man, great that, you know, uh,

• 32:21Speaker 01

  Things like that are you're able to to help people to to to achieve their dreams somehow.

• 32:25Henry Washington?

  Yeah, yeah, it sounds to me like this is more about helping your community than it is about you having another income stream.

• 32:32Speaker 01

  Income is good.

• 32:33Henry Washington?

  Yeah, I tried to set you up there, but that's okay. That's okay.

• 32:39Speaker 01

  If you do good and get some income, you know, we win.

• 32:42Henry Washington?

  Absolutely. Absolutely. It's super cool, man. And you know, as as someone who teaches people uh how to invest, it's very, very rewarding when you see someone, especially if they struggled or if they didn't know how to do it or didn't think they could do it. When you start to see them get that success, man, it feels good. I get I get a bigger dopamine rush when I see that happen than when I do my own deals. And so I truly do understand what that feels like. So you you did the thing, right? You made a plan, you executed against the plan, you're technically retired, you have the paid off assets. What are you gonna do now? What's the plans for the future?

• 33:20Speaker 01

  Yeah, that's what I need your advice.

• 33:24Speaker 01

  What's what's next? You know, so yeah, that's that's a great question. You know, what what's nice is like a is it's kind of a you are on a on a crossroad. I mean, you you try to to diversify or maybe grow a little bit more, you know, still TBD, not not fully decided, you know, and right now, you know, I mean, it's still it's a little bit polluted.

• 33:46Speaker 01

  Market is completely but uh but all honesty right now, if if I was starting is what I tell people. Right now is when you need to jump because things are on sale.

• 33:56Henry Washington?

  Yeah, yes, they are. It is a good time. I think it's 2026, especially. I think it's going to yield a lot of opportunities for people. I think that you got a lot of people that experienced a lot of pain in 2025 and they're looking to dump some of those assets and that's going to create opportunity. Uh, I think there's some opportunity for interest rates to come down a little more. I just think that there's good opportunities coming in 2026 and those who are prepared to take advantage of it. Those who have done the fundamental things to put themselves in a position to be able to jump when the when the when the time is right are the ones who are going to succeed. So I I I agree with you. All right, Mr. Vicente. Thank you so much for coming on the BiggerPockets Podcast and sharing your story. It's truly an inspirational story. It's great.

• 34:39Henry Washington?

  To see someone make a plan and execute against a plan, but not have to be some massive landlord with, you know, 400 properties. And it's really, truly is a simple plan that anybody can execute. Start with the home you live in. Focus on buying assets in good parts of town. Focus on paying off the assets instead of growing and scaling to a massive scale. And then, before you know it, I mean, I meant to acknowledge this earlier in the show, but from 2013 to 2024, 2025, that's what?

• 35:12Speaker 01

  13 years? Yeah.

• 35:13Henry Washington?

  13 years to pay off eight properties. Like, round of applause, man. That is something that's difficult to do for one property. You knocked it out with eight properties. And so you should be proud of the life that you have built, and you should be proud of how you show up and help your community. And thank you so much for taking the time to share all of that with us.

• 35:34Speaker 01

  Thank you, Henry, for having me. Great to have this conversation. And hopefully, people can see that it's not impossible, you know, investing in real estate is, I mean, it's not easy.

• 35:45Henry Washington?

  No, no, it is not easy.

• 35:47Speaker 01

  Very well, but it's possible. It's possible. It might not be for everyone, but again, it's like any other business.

• 35:52Henry Washington?

  All right, folks. Thank you so much for tuning into this episode of the BiggerPockets Podcast. I look forward to seeing you on the next episode. We'll see you soon.

• 36:01Speaker 05

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