How I Built a $100K/Year Passive Income Stream in 5 Years

How much passive income would you need to retire early? $60K/year? $80K/year? $100K/year? What if you could build a financially freeing passive income stream in just five years? Five years from now, you could retire early, quit your job, or keep building wealth. What would that freedom feel like? Joe Hammel has already achieved it, using a simplistic, beginner-friendly “bread and butter” rental strategy. Today, he’s generating $115,000/year in pure cash flow from his rentals, just five years after buying his first rental. In this episode, Joe shares exactly how he grew his six-figure passive income stream and the exact blueprint you can use to replicate it. Joe invests in a market that real estate investors used to laugh at—Detroit. However, the tables are now turning, as Detroit continues to see solid appreciation, cash flow, and affordable prices. Joe buys houses for $100,000 (yes, even today), often using the “slow BRRRR strategy”, and rents them out for well above his costs. He says out-of-state investors can do this easily as well, and he has helped dozens repeat his system. This could be your path to achieving financial freedom in under a decade, just like Joe! In This Episode We Cover The “bread and butter” rentals beginners can buy to build passive income streams Why Joe says Detroit is such a solid real estate investing market (especially now) Using the “slow BRRRR” method to build wealth faster and increase your equity The best rental property types to target (for beginner investors, especially!) How to invest in affordable markets even if you live hours away And So Much More! Check out more resources from this show on ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠BiggerPockets.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.biggerpockets.com/blog/real-estate-1186 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.

• 0:00Dave Meyer?

  This investor buys houses for only $100,000 just outside a major city. He fixes them up, he rents them out, and repeats the process. It's only taken him six years of using this simple formula to grow a portfolio that's now cash flowing $9,000 of passive income every single month. There's no big secret to his success, and in fact, he's helped dozens of other investors buy almost identical properties and start their own journey towards financial freedom. Today, he's sharing exactly how he's done it, so you can follow the same path too.

• 0:39Dave Meyer?

  Hey, everyone. I'm Dave Meyer. I'm the head of real estate investing at BiggerPockets, and I've been a rental property investor for more than 15 years. Our guest on the show today is agent and investor Joe Hammel, who lives and invests outside of Detroit. Joe only got into real estate six years ago, but he's managed to buy 24 properties, which generate over $100,000 in cash flow every single year. And on the show today, he's going to explain how he's scaled such a profitable portfolio with very affordable properties, why he's converted to the slow-burr strategy, love that, and his best advice for other investors looking to do these exact same types of deals. Let's bring on Joe.

• 1:22Dave Meyer?

  Joe, welcome to the BiggerPockets Podcast. Thanks for being here.

• 1:26Speaker 01

  Thanks, Dave. It's great to meet you.

• 1:28Dave Meyer?

  Yeah, super excited to have you on and hear a little bit about your story. So give us your background. Where are you from and how do you find yourself getting into real estate investing?

• 1:37Speaker 01

  Well, I'm originally from Ohio. I now live and invest in the metro Detroit market. And I signed my first lease, it would have been about five years ago exactly to today. It would have been on October 1st, 2020. Since then, my wife and I, we have bought 24 properties. It's 31 doors, and we're cash flowing, it's $115,000 a year after budgeting for vacancy maintenance at CapEx.

• 2:08Dave Meyer?

  Sounds like an incredible portfolio to me. To do in five years and you've also done that across two really different markets. Starting in 2020, fast forward to today, totally different landscape that we're in. So I'd love to just break down how you've done this, but would first just want to understand sort of your goals and motivation for being an investor in the first place.

• 2:27Speaker 01

  I was working in a factory. I was in manufacturing and I quickly realized that's not what I wanted to do for the rest of my life. So when I was kind of searching, trying to figure out what I wanted to do, I was talking to my buddy Jake Graff and he's like, hey, man, you need to listen to BiggerPockets. And so for many of us who have done that, it flips your world 180. He was house hacking at the time. So he explained that to me. And so I went down the rabbit hole of multiple podcasts a day, watched all the YouTube videos. I read all the books. I was in the forums. And so that's when it really triggered like this is what I'm going to do either full time, side hustle. I'm going to figure this out.

• 3:10Dave Meyer?

  Well, I absolutely love hearing that, that BiggerPockets has helped you hone your vision and figure out how to get into real estate. What is it about real estate that's resonated with you that previous careers in manufacturing wasn't doing for you?

• 3:24Speaker 01

  It's the common man's path to wealth, right? It's just the greatest investment. When you look at how much money you can make in cash flow and then appreciation, loan pay down and your tax benefits, it's just you can't compete with it as an investment vehicle. So just dump all my money into it is the best place for it to be.

• 3:46Dave Meyer?

  I love that approach. I've never heard it described specifically that way, but it makes so much sense to me. Actually, what makes real estate so interesting that I love is you don't have to like invent anything, you know, it's a path to entrepreneurship where you're not having to come up with some new genius business model. This is just a repeatable formula that pretty much anyone can follow, which is super cool. So how did you go about financing, finding your first deal and what kind of deals were you looking for off the bat?

• 4:16Speaker 01

  Yeah, so I had done two deals.

• 4:20Speaker 01

  In Ohio where I bought land, I bought a house and I sold those when I moved to Michigan. And so that was where I initially had some capital. I made like 40K, 20K on each of those. Um, and then by working, I came to Michigan, I had like 50, 60 grand. And so my first property, I was really looking for a house hack, right? I was, I was doing, I was trying to do what I was supposed to do, but coming to Michigan, that was a bit overwhelming. I didn't know how to recognize what a good house hack was. So I ended up going with a safe bet, which was I just picked a single family home. And it backed up to a nice neighborhood. It was on a busy street, but I got it for a hundred and $3,000. I was going to live there for a while and I knew eventually my wife and I would get married and we'd buy another house. And that'd be my first rental property.

• 5:06Speaker 01

  And so that ended up being the first property. I bought it for 103, I put 15K into it. It's worth like 190 today. And I thought it was going to rent for like 1,300 a month, but I ended up signing a two year lease at 1,600 a month. And so it's cash flow, six, $700 a month for five years straight at this point.

• 5:29Dave Meyer?

  That's incredible. Well, it sounds like you did pretty well figuring out where to buy the first one. You know, this podcast has a long history with Detroit. I don't know if you know this, but like Josh and Brandon, when they first started, Josh loved to hate on Detroit.

• 5:44Speaker 01

  Yeah.

• 5:44Dave Meyer?

  But I, I've heard that it's one of those markets where if you know the market well, you can do really well. But it's not for people who are maybe out of state or haven't spent the time researching it. Do you think that's true?

• 5:57Speaker 01

  I mean, I, I say this in good fun. There's two types of people who doggone Detroit. And it's people who have never bought a property there and people who did it wrong.

• 6:06Dave Meyer?

  Yeah. Okay. That's fair.

• 6:07Speaker 01

  Because if you do it right, you can really make a lot of money. And we've really identified what doing it right looks like. We call them bread and butter deals. And if you buy those, they're just a great balance of price, rent, ROI, location. And we see a lot of success with them.

• 6:26Dave Meyer?

  That's great. So what are those bread and butter deals? Is it similar? To what you bought on that first one?

• 6:31Speaker 01

  These properties, there's your suburbs, Brent Butter, and then there's your Detroit Brent Butter. Suburbs are going to be a little higher price, a little lower ROI, and a little easier experience. And that's the difference between suburbs versus Detroit. And so to break it down as concisely as possible, it's going to be an 80K to $130,000 house. They're going to rent for 1,100 to 1,500 a month. They're 1% to 1.4% rule deals. Cash on cash, 6% to 12%. Cash flow, 50, $300 a month. They're good appreciation. We grade properties A to F. And so these are what we call C+ B-.

• 7:09Dave Meyer?

  So what is your definition of a C+? Like, describe the neighborhood for us.

• 7:13Speaker 01

  Well, yeah, so in my, my portfolio is a great example, right? I have 30 plus doors. And in five years, I've had two evictions. And I've had maybe five or six tenants stop paying and I've had to send them a notice to quit and get rid of them. Somebody stole a trash can once and somebody kicked in a garage door. The only two crime that I've dealt with in.

• 7:33Dave Meyer?

  Yeah, I have way more than that, yeah.

• 7:35Speaker 01

  Right, and then vacancy is another one that people will look at. I have very little vacancy. I have one unit vacant right now just because the tenant moved out a week ago. So that's, that's what I'm calling a C+ B- market.

• 7:48Dave Meyer?

  And what condition are the properties in?

• 7:50Speaker 01

  So I do a lot of light to medium sweat equity and probably favoring the medium sweat equity. So I'm doing the cosmetic plus type rehabs. Now, again, you can find the turnkey at the higher price range of the Brent Butter. I'm staying lower price range with more sweat equity.

• 8:10Dave Meyer?

  And what does that deal look like? So you said you're, you know, you're buying it for what, 80, 100 grand? And putting how much into it?

• 8:16Speaker 01

  In 2023, my average single-family home purchase price was $80,000. And my average rehab was probably 15, maybe touching 20K rehab.

• 8:27Dave Meyer?

  I'm asking these questions about the specifics because these seem like very approachable kinds of deals, right? If, even if you're putting 25% down with traditional financing on an $80,000 property, 20 grand. Down, you know, with a reno of 15, 20 K, you need closing costs, you need reserves, you know, $50,000, obviously a lot of money, but more palatable to a lot of people who maybe don't want to go the house hack strategy and put three and a half percent down or live in a super expensive market. This just seems quite achievable for people who are thinking about or comfortable with out of state investing, presuming you don't live in Detroit. You know, the question

• 9:08Dave Meyer?

  I think you hear about Detroit that I just curious your opinion on Joe is like, what about the appreciation? Cause it seems like cash flow is pretty solid, you know, post COVID or going into sort of a flatter market. What do you think appreciation goes from here?

• 9:21Speaker 01

  You know, I'm sure you've looked at the data, but recently we've done really well, especially in the post COVID era. I mean, we're in the top, the 2023, we're number one, at least by some sources.

• 9:32Dave Meyer?

  Yeah.

• 9:33Speaker 01

  And ever since we're still six, seven percent, even just 2024, 2025, which most markets, they can't say that. And I think it comes down to, to one major thing. I think it's affordability. I think the other markets that are struggling, it's because of affordability. And the reason why Detroit isn't is because we still are a low enough price point that we have room to grow.

• 9:56Dave Meyer?

  I agree. It's kind of been my whole thesis is just that these markets that are affordable, people are going to still keep transacting. Whereas other markets I, I invest in, it's just unaffordable and you see the market coming down. There are obviously still people doing stuff, but the number of transactions is just really low. And we've just reached the point where we can't stretch affordability. People are not able to pay. And maybe when things get a little bit cheaper, they'll jump back in. But these markets, Milwaukee, obviously Detroit, Cleveland, a lot of the Midwest, this is where things are happening because it's where people who live there and work there and have normal jobs are still able to participate in the housing market. That's a

• 10:37Dave Meyer?

  healthy housing market. I think bodes well for those types of markets in the future. So this is fascinating. Love hearing the specificity of the kinds of deals that you're buying here. I'd love to hear a little bit about your story though, how you've evolved your own portfolio. Let's get into that right after this quick break.

• 10:55Speaker 02

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• 11:25Speaker 03

  Hey Spotify listeners! When you travel with American Airlines, you'll enjoy comfort and convenience at every altitude. Before takeoff, unwind in the Admirals Club Lounge with curated self-serve offerings of hearty bites and refreshments. In flight, stay connected with high-speed Wi-Fi, sponsored by AT&T. Your journey is designed to feel easy, from the moment you check in to the moment you arrive. No matter where you're going, American gets you there. Book now at aa.com.

• 11:50Speaker 04

  Cheers to fall savings at Whole Foods Market, home of higher ingredient standards. This Halloween, share chocolates and candies made without that spooky high-fructose corn syrup. Throwing a party? Make it easy with a Berry Chantilly Cake. Ready to cook pizza? No antibiotics ever chicken wings. And sushi made fresh daily. Fall gatherings never tasted better. Save through November 3rd at Whole Foods Market.

• 12:19Speaker 05

  This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome? That's new. It can help you with practically anything on the web. Like restoring a vintage motorcycle from a 50-page restoration block. Or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required. Compatibility and availability varies 18 plus.

• 12:48Dave Meyer?

  Welcome back to the BiggerPockets Podcast here with investor Joe Hammel, who's been growing his portfolio in Detroit for the last five years. We heard a little bit about your first deal where you bought a house hack. How did you grow your personal portfolio from there, Joe?

• 13:04Speaker 01

  I bought that first one, rented it out in 2020. And then in 2021, we bought, I think it was five deals. And the funding for that came from that original 50, 60 K that I moved to Michigan with. And I also, 2021, I was able to pull out my 401k penalty free using the COVID, whatever that was. So that was more funding. I did a couple of the soft burrs. You've been calling them a slow burr. We call them a soft burr.

• 13:36Dave Meyer?

  Whatever you want to call it. Yeah. Let's use slow burr. We gotta, we gotta standardize this. Slow burr is what it is.

• 13:42Speaker 01

  I agree. It's a better name than soft burr. So was able to pull some out there. And then my wife, she had a good income and we both determined, hey, let's live 100% off of your income. And then everything that I make through my job and as an investor, we're going to reinvest all that cash flow. So that was the funding. Every time I hit a certain threshold of money, I would go look at the market and I'd pick out a deal and execute.

• 14:09Dave Meyer?

  So you would, you know, have one going, you would do the renovation, rent it out, get rents up to market rate. And then you would refi. So you would basically take some or all of that money, combine it with your income to finance the next one?

• 14:21Speaker 01

  Exactly. And most of the time it was some of the money. I did hit one perfect burr.

• 14:26Dave Meyer?

  Wow, that's awesome. Wow. I'm asking that because I, you know, if you've listened to the show, you've heard me talking about the slow burr. And I like this because it's more realistic and it's just a little less pressure in, in today's day and age. And just want to reiterate that doing the quote unquote, perfect burr, where you can refinance at 100% of your cash is just pretty rare these days. I'm sure it still happens, but it is pretty rare. And I really just think in, in the new realities that we're facing, having a Appropriate expectations is super important and not expecting to achieve returns that just don't exist anymore. That doesn't mean they're not still life-changing events that are going to help you move towards your financial goals.

• 15:08Dave Meyer?

  It just means it's we're not in this free money period where everything was perfect. So I just wanted to make sure people understand that the burr still really works. These perfect burrs were just there at a certain time and place and is not what what we should all be expecting. So you know, you keep doing these same deals for five or six years. How have you avoided this shiny object syndrome that I certainly get in real estate? I think a lot of people do where you want to try everything. I want to do short-term rental, you want to flip, you want to do creative finance, you want to do everything. How have you and why have you just stuck to the same approach?

• 15:42Speaker 01

  I think you said it in terms of haven't you had shiny object syndrome? I think it's because I was aware of not having it, right? That was a very conscious decision I made early on was don't do that. Get good at something and get bored with it, whether it's, you know, your job or investing. And I had something, I hit success on my first one, two, three deals. And so I was just clear the slate and repeat the same thing 20 times.

• 16:07Dave Meyer?

  That's awesome. It seems like even though the market has been hot, finding deals hasn't been hard?

• 16:14Speaker 01

  No, I would say in 2024 was kind of a shift in my strategy. That was an extreme seller's market. Interest rates were higher then than they are today. So I really went from an average price in 2023 of 80K to an average price of 125K in 2024. I'm still getting 6%, 9% cash on cash ROI, but I really made those changes for a couple of reasons. The one was the market adjustment, right? It just, I had to, the $80,000 house was now a $100,000 house. To get the same profile of property, I had to go up in price. So that decision was kind of made for me.

• 16:56Speaker 01

  And then the second reason why I really went from 100 to 125 was my personal strategy change. I already had 15. Sixteen seventeen, bread and butter, really good cash flow. They were two one, three one sided houses, maybe a little bit of character. And so now I was like, okay, let's get, let's, let's go up a notch. And I was looking for brick. I wanted a basement and a garage. I didn't want any character. And so that just took me up then to the 125 price point. So all four of my deals in 2024 looked exactly the same with that 125 price point.

• 17:31Dave Meyer?

  Okay. And is that kind of, I mean, I assume it's gone up a little bit, but those kind of deals are still available to you?

• 17:37Speaker 01

  Yeah. I mean, like I said, shoot, fish in a barrel. I could probably pick a couple out right now.

• 17:43Dave Meyer?

  Pretty incredible. So let's talk a little bit about specifically what to look for. Cause obviously not everyone is going to invest in Detroit, but I think this model that you've created is somewhat repeatable in a lot of markets. Obviously, you know, if you're living on the coasts, it's probably pretty expensive. But if you're investing somewhere in the Southeast or in the Midwest, there's a lot of these kinds of deals. So let's just talk characteristics, not just price point. Like, are there certain bedroom counts you're looking for? And how do you try and identify that sweet spot of value add? I think that's a big question for a lot of people. Like what one person calls

• 18:23Dave Meyer?

  a cosmetic renovation could be totally different from what another person calls a cosmetic renovation. So what are the kind of properties and upgrades that you're trying to target?

• 18:34Speaker 01

  So a lot of these are two ones and three ones, right? Which a lot of people, they really want the three two. But I think the ROI is higher on the two, one, three, one, because less people want them. Your price to entry is lower.

• 18:50Dave Meyer?

  So you're doing these two, one, three ones, which makes sense to me. Are you doing kitchens, bathrooms, floors? Like what are, what's the scope of the renovation you're trying to do?

• 19:00Speaker 01

  The lighter ones are painting and fixtures. So you go in and you paint and you do new light fixtures, new knobs, new faucets, and the whole house looks great.

• 19:09Dave Meyer?

  Yeah.

• 19:09Speaker 01

  That's your light version versus your medium one is like, okay, we're going to replace. All the toilets, all the fixtures, we're painting, we're refinishing the floors. We gotta do all of our landscaping outside, maybe replace the furnace, something like that is what I consider a medium versus large is you're doing a gut job. And I think that's when your risk goes through the roof, when you take on those big ones.

• 19:31Dave Meyer?

  Yeah, literally, it goes into your roof a lot of the time.

• 19:34Speaker 01

  Yeah.

• 19:34Dave Meyer?

  Doing that. But yeah, I think that makes a lot of sense. And is that sort of what you recommend for newer investors is taking on like that kind of fixtures, paint kind of thing first?

• 19:46Speaker 01

  Yeah, definitely. It's, it's why I'm really cheering on your slow BRRRR messaging right now because it's just so much more realistic to hit the lighter sweat equity and get your feet wet on those, you know? And if you want to go more aggressive after that, do it, you know, but to start out, just take on the lighter stuff. But I do like taking on some sweat equity because that's how you're going to force ROI in a property.

• 20:09Dave Meyer?

  If I had my druthers, I would pay a little bit more and buy a stabilized turnkey property that had solid cash on cash return, not amazing. And those still exist sometimes in some places, but the juice is just better on a light cosmetic rehab right now. Like you will get better cash flow and you're going to build equity. And I think that's the real important thing. People look at BRRRR and they say, oh, I can build equity. That is definitely true. But a lot of times that's how you have to generate cash flow too. Because if you look at a property with the rents that it can command in its existing condition, you're probably not hitting that six to nine percent cash on cash return.

• 20:50Dave Meyer?

  Like I, I don't see it anywhere. You could maybe get three or four percent, which is okay for some people. That's fine if you just really want to do nothing. But if you're trying to hold on to something for a long time, that's why the slow BRRRR works. Because you can do it sort of at a slower pace, but then you get the equity, but you juice up those rents and provide a really high quality experience for your tenants that they're going to want to stay, that they're willing to pay for. And that just sets you up for a more successful, long-term hold period, in my opinion.

• 21:20Speaker 01

  Yeah, I couldn't agree more.

• 21:22Dave Meyer?

  We gotta take a quick break, but stick with us. We'll be right back. 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,

• 22:02Dave Meyer?

  website, email, all in one account. And right now, you can get Black Friday and Cyber Monday pricing through December 14th. So snag Hostinger's services at their lowest prices before the sale ends. Create your website today for just $1.99. Go to hostinger.com/realestate and use code REALESTATE for an additional 10% off Black Friday and Cyber Monday pricing.

• 22:27Speaker 02

  New and exclusive holiday decor just launched online at The Home Depot. Check out the viral Grand Duchess collection with smart holiday lights you can control from your phone. Easily customize the twinkle across trees, wreaths, and garlands to match your holiday vibe. Create stunning light effects, then switch it up with the tap of your fingers. Even the man in red will be impressed. Shop the holiday decor you want online only at homedepot.com.

• 22:58Speaker 03

  Hey Spotify listeners, when you travel with American Airlines, you'll enjoy comfort and convenience at every altitude. Before takeoff, unwind in the Admirals Club Lounge with curated self-serve offerings of hearty bites and refreshments. In flight, stay connected with high-speed Wi-Fi, sponsored by AT&T. Your journey is designed to feel easy from the moment you check in to the moment you arrive. No matter where you're going, American gets you there. Book now at aa.com.

• 23:23Speaker 04

  Cheers to fall savings at Whole Foods Market, home of higher ingredient standards. This Halloween, share chocolates and candies made without that spooky high-fructose corn syrup. Throwing a party? Make it easy with a Berry Chantilly Cake. Ready to cook pizza? No antibiotics ever chicken wings. And sushi made fresh daily. Fall gatherings never tasted better. Save through November 3rd at Whole Foods Market.

• 23:52Speaker 05

  This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome? That's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required. Compatibility and availability varies 18 plus.

• 24:21Dave Meyer?

  Welcome back to the BiggerPockets Podcast. Let's get back into our conversation. So tell me a little bit about managing these renovations, because you're an agent as well. Are most of the people you're working with local or out of state?

• 24:34Speaker 01

  The majority is out of state. It's like 65% out of state versus 40, 45% local.

• 24:42Dave Meyer?

  And how do you coach and get people comfortable with the idea of doing renovations from out of state?

• 24:49Speaker 01

  So something started building from the very beginning was our resource list. And it's at this point, it's 200 plus names and phone numbers of CPAs, attorneys, contractors, electricians. And so this is, that's really been a huge ticket to, hey, you can build your core four with this resource list. And I think that's broken down a lot of barriers. Finding contractors was one of the hardest parts for me at the beginning.

• 25:17Dave Meyer?

  Of course.

• 25:18Speaker 01

  So I ended up getting my builder's license and starting a small handyman slash general contracting company just to help myself do a lot of these rehabs. And obviously, clients can use them as well.

• 25:31Dave Meyer?

  So what do out of state investors do? They find a contractor on your list, and then they manage the whole thing themselves? Or like, how are they developing a scope of work and overseeing the project while they're out of state?

• 25:45Speaker 01

  So we do a lot of boots on the ground for out of state clients. So we'll take a really good walkthrough video, most of the time before purchase. And that's how they're closing these properties. And so then, after they close, they have that video and they can either hire a GC to just do the whole. Whole thing, or if they want, they can pick off, you know, one person at a time, hire my painter, my floor person and just do what needs to be done.

• 26:09Dave Meyer?

  Yeah. As an out of state investor, that is tough. It is tough to run subs yourself out of state. I think it's easier to do it with a GC or the way I've done it, I don't know if how, what you recommend, but like the way I've done it is my property manager has a lot of subs and sometimes I will have them run the subs through and help me work on the scope of work. Do you see people do that as well?

• 26:32Speaker 01

  Yeah, I'd agree. The GC is the more popular route and then as well as having the property manager GC. It's especially for the out of state, that's typically what they're going to favor.

• 26:41Dave Meyer?

  And then do you see most out of state investors before they purchase with you? Do they come and visit?

• 26:46Speaker 01

  It's like 50 50. We have a lot of them that will close without ever seeing it. And then some of them will want to fly in for closing.

• 26:54Dave Meyer?

  But did they ever even come to Detroit and like get to know the market at all? Even if they buy the property site unseen?

• 27:00Speaker 01

  Yeah, sometimes, sometimes they'll want to come in and just confirm that they want to buy here. And then we'll usually set up some sort of tour from on that weekend. They come in, we'll go see 10 houses and go from there.

• 27:11Dave Meyer?

  That's my favorite thing to do. I love going to markets and touring around. It's the best. I really recommend people do that. If you're an out of state investor, I've closed on property site unseen, but going to the market and just getting a lay of the land, you know, generally where these properties are going to be. You like this area, you don't like that area. It's worth it. It really is worth a thousand dollars or whatever you're going to spend. I know that's seems like money you could be putting towards a property and you can, but it's just money that you need to spend to invest into your business for the longevity of it. I just know myself, I sleep easier at night investing out of state, knowing that I've been there and I have a general sense of like, I really like this neighbor. I trust this neighborhood. That's like a good place. Recommend that people take that approach as well.

• 27:57Dave Meyer?

  So Joe, tell me, you've succeeded and had this pretty incredible portfolio that you've built up over the last couple of years. What comes next for you? What are your goals now?

• 28:06Speaker 01

  It's a good question because obviously I hit some numbers that were my lifetime goals. So it's kind of surreal at 31 that could be done. But my wife and I talk and we both believe in God's purpose for our life. And he let us know that we're not allowed to go sit on a beach. So we're brainstorming some philanthropic ideas. We're going to keep investing.

• 28:29Dave Meyer?

  Oh, that's great.

• 28:30Speaker 01

  Keep investing, keep growing. We're going on a couple of side projects with a fintech group and hopefully have some cool things for investors at some point there. But yeah, we're just going to keep going and try to make the world a better place.

• 28:41Dave Meyer?

  Oh, that's awesome. I love to hear that. And I think that's one of the under discussed parts of real estate investing that's so cool because I'm on board with you. Like, I'm not someone who could sit on a beach and not work. But it's so cool how real estate investing, when you reach a level of financial independence, just allows you to take on projects that are philanthropic or just have personal importance or meaning to you or, you know, it's, you know, people often say they want to spend more time with their family, which is a common one, which is great. But like, if you have other professional interests or philanthropic interests, it allows you to take that on as well, which is super cool. So highly respect that that's how you're thinking about spending your time, Joe.

• 29:22Speaker 01

  Thanks.

• 29:23Dave Meyer?

  Well, Joe, thank you so much for being here today. It's been great meeting you, hearing your story. Congratulations on all the success. Make sure to keep us posted on your next steps.

• 29:32Speaker 01

  Awesome. Thanks a lot, Dave.

• 29:33Dave Meyer?

  And thank you all so much for listening to this episode of The BiggerPockets. We appreciate you listening. We'll see you next time for another episode in just a couple of days.

• 30:12Speaker 06

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